Dignity shares dip on CMA concerns of sector

Dignity shares (LON: DTY) opened 4.86% lower on Friday as the Competition and Markets Authority (CMA) has said that it has “serious concerns” about the funeral sector.

The watchdog told funeral directors that they would need to provide much clearer pricing to customers after investigating the sector.

Martin Coleman, a CMA panel inquiry chairman, said: “Organising a funeral is often very distressing and people can be especially vulnerable during this time.

“That’s why our remedies are designed to help people make choices that are right for them and ensure they can be confident that their loved one is in good hands.

“The CMA will be keeping a close eye on this sector to make sure our remedies are properly implemented and help it to decide whether further action is necessary when circumstances return to a more steady state.”

The CMA has been investigating the sector for the past two years, however, the final results of the report have been delayed amid the pandemic.

In response to the CMA’s concerns, Clive Whiley, Executive Chairman of Dignity commented:

“We welcome the Competition and Markets Authority (CMA) Final Decision Report for the funeral and crematoria market investigation. Dignity has engaged openly and collaboratively with CMA throughout the investigation . In fact Dignity has been working to raise awareness regarding issues of transparency and consistency in the quality of care across the funerals sector for a number of years. In the months ahead, we look forward to working with the regulator and the Government to ensure the package of remedies work for consumers, and that they are implemented effectively across the market.

“Finally, we also note the acknowledgement from the CMA that there is evidence, even before COVID-19, that perceived excess returns have declined since the review period (2014 to 2018) expired two years ago,” Whiley added.

Dignity shares (LON: DTY) are trading 5.76% lower at 639.88 (1204GMT).