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Vistry cuts profit outlook as unsold homes pile reaches £600m
The UK housebuilder reported a £661.3m loss before tax for the first half, and it says its average discount to buyers was 7.1% in July.
Vistry Group, one of the UK’s largest housebuilders, has cut its annual profit expectations after its half-year losses widened, citing pressure from weak summer sales of private homes. The company said it is dealing with a £600m stockpile of unsold properties, and it is now shifting to a more focused model aimed at delivering about 12,000 homes a year.
In a turnaround plan, Vistry said it will stop selling private homes in south-east England and slim its operations. The company also announced an additional £50m cost savings package, on top of a £25m voluntary redundancy programme and an earlier hiring freeze, and it said its workforce fell to 4,150 by the end of July.
Results underscored the deterioration, with Vistry posting a loss before tax of £661.3m for the first six months of the year, versus profit of £40.9m a year earlier. The period included a £475m writedown and a £73m provision for building safety works, while half-year revenues declined 9% to £1.7bn.
For the full year, Vistry now expects an adjusted profit before tax of £165m, after an adjusted loss of £83.3m in the first half. The company said it completed 6,304 homes, down 8% from a year earlier, leaving it with £220m of unsold properties, and it attributed the downturn to “disappointing summer sales” and changes to affordable housing deals.