A unique example of excellent business economics

One very high quality business listed on the ASX is Invocare Limited (ASX:IVC). IVC is the clear market leader in funeral homes, cemeteries and crematoria in Australia, and has a strong market position in New Zealand and Singapore. The idea of a business whose revenue is tied to the death rate may not be everyone’s cup of tea, but from an economic standpoint, it is one you have to admire. Some of the relevant facts in relation to IVC’s business in Australia include: * Clear market leader with 34% market share and few competitors of any scale; Effectively guaranteed volume growth (and accelerating volume growth) as a result of the ageing population dynamic; and *A market that is not highly price-sensitive and which values brands. Brands that take a long time to build. These features have contributed to impressive shareholder returns over an extended period of time. The following chart from IVC’s 2015 results announcement tells the story pretty well. (VIEW LINK)