As anticipated, the first half of 2016 witnessed a significant reduction in the number of deaths at 302,000, 4.7 per cent lower than the same period in 2015. This was the principal cause of the Group's underlying operating profits being 6.9 per cent lower at £55.6 million (2015: £59.7 million).
Underlying earnings per share decreased 8.5 per cent to 67.7 pence per share (2015: 74.0 pence per share), reflecting the impact of a fixed finance charge on reduced operating profits.
Basic earnings per share were 65.9 pence per share (2015: 71.0 pence per share), a decrease of 7.2 per cent.
Update on crematoria acquisition from Funeral Services Limited (trading as Co-op Funeralcare)
I was delighted that we were able to announce the proposed acquisition of five crematoria from Funeral Services Limited (trading as Co-op Funeralcare) for £43 million on 31 May 2016. The three freehold locations being acquired completed on 27 June 2016 (after the balance sheet date). The leasehold location in Shropshire was acquired on 22 July 2016. The remaining leasehold location is progressing towards completion, with consent being required from the relevant local authority. It is now expected to complete during September 2016.
The Group paid a final dividend of 14.31 pence per Ordinary Share on 24 June 2016.
The Group proposes to pay an interim dividend of 7.85 pence per Ordinary Share (2015: 7.14 pence) on 28 October 2016 to shareholders on the register at 23 September 2016. This is a 10 per cent increase on the previous year.
Our customer survey results continue to demonstrate the outstanding work being done by our staff. In all parts of our business, they remain focused on performing their roles to the best of their ability, allowing the Group to help so many families at a difficult time.
The Group continues to expect that the high number of deaths seen in 2015 will normalise in 2016. Although, as expected, this would lead to a slight reduction in operating profit during the year, the Group remains committed to its medium-term target of increasing its earnings per share by an average of 10 per cent per annum.