Historically very predictable, wood casket manufacturers now see sales challenges as the Boomer generation increasingly turns to cremation or other "non-casketed" funerals. statistics on deaths by the Center for Disease Control and Matthews International, the largest U.S. manufacturer of caskets, sees the number of casketed funerals declining in absolute numbers, and as a percent of deaths - which are actually on the rise.
Matthews International, a diversified firm with a large stake in the casket business and traded on NASDAQ as MATW, reported $23.9 million in net income for its third quarter, a 3.5 percent rise. But that increase primarily reflected the acquisition of Aurora Casket Company and lower commodity costs.
Overall sales were $382.1 million, up 4.7 percent.
The Memorialization segment, which is mostly caskets, was $152.8 million, an increase of $27.2 million primarily from the acquisition of Aurora. CEO Joseph C. Bartolacci noted, “ Each of our segments has been facing some challenging market conditions, both economic and demographic [death rates]. However, we have still been able to generate earnings performance nicely ahead of last year."
Caskets are among the msot complex wood products to manufacture, with sometimes complex combinations of millwork and finishing.
“The acquisition of Aurora was the main factor in the sales and operating profit increases for our Memorialization segment during the quarter. In addition, the segment’s operating profit improvement also reflected the benefits from prior productivity initiatives, current cost control efforts and lower commodity costs."
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