Arbor Q3 profits, revenue up as clients buy pre-burial spaces ahead of the HST

TORONTO - Arbor Memorial Services Inc. said Thursday its third-quarter profits and revenue improved as sales of pre-burial spaces increased ahead of the introduction of the harmonized sales tax in Ontario and British Columbia.

The company (TSX:ABO.A), which owns and operates cemeteries, crematoria and funeral homes across Canada, booked earnings of $6.4 million, or 61 cents per share, in the period ended July 25. That's up from $5.6 million, or 52 cents per share, in the corresponding period in 2009.

Revenue climbed 31 per cent to $81 million from $61.7 million in the prior-year period.

"The increases in pre-need burial space sales and annuity fee income were mainly due to the implementation of a harmonized salestax in Ontario and British Columbia on July 1, 2010, which caused many customers to make their pre-need arrangements in advance of the transition date," Arbor said in a news release.

The company said pre-need contracts written in the quarter increased by 187.5 per cent while sales in the funeral division inched up just 0.2 per cent.

Arbor Memorial Services owns 41 cemeteries, 26 crematoria, five reception centres located on cemetery premises and 82 funeral homes in eight provinces.

Shares of the company last traded Wednesday at $24 on the Toronto Stock Exchange.