The UK's only listed undertakers said its underlying operating profit dipped 13% to £31.1m in the 13 weeks to 25 March compared to a year ago, after the UK death rate fell by 11% to 156,000 in the same period.
Last year, the number of deaths in the UK jumped by 7% to 588,000 compared to 2014, according to the Office for National Statistics. This rise was the largest annual increase since 1952.
The Sutton Coldfield-based firm, which runs more than 700 funeral parlours and just under 40 crematoria, said trading in its first quarter was "consistent with our expectations". It reiterated that its full-year profit estimates will be lower than last year.
The firm said it expects last year's "unprecedented increase in deaths to reverse in 2016."
The business added: "Its current assumption remains that the number of deaths in 2016 will be broadly comparable to 2014."
Dignity said that since the start of the year it had added one new funeral parlour to the group.
Chief executive Mike McCollum said: "I am pleased with the group's performance in the first quarter, which was consistent with our expectations."
In March, the group posted full-year underlying profits that jumped by a better-than-expected 23% to £72.2m in the year to December 25, as a result of the high death rate in 2015.
Last year the business added 48 funeral locations to its network, at a cost of £50m.