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Gloucestershire Business News

Mortar celebrate: all smiles at Vistry Group

A new update on trading from Homebuilder Vistry Group shows an upbeat first half of 2024, as profits rise by 10% and the company reveals optimistic expectations built upon the fact that the group is "significantly outperforming" against rivals in the housebuilding sector.

The news comes in contrast to reports last October that the building giant, which has offices in Bishop's Cleeve, was looking at losing 200 jobs with an eye on a £40m profit loss. Today's financials also land just as Jim McMahon, the new Communities and Housing Minister, pledges to invest in a round of housebuilding which sets a target of 1.5m new homes in the UK.

Greg Fitzgerald, Chief Executive, said: "The Group has delivered a strong performance in the first half which underpins the Board's confidence in its expectations for the full year. Our Partnerships model is significantly outperforming the broader housebuilding market and we are confident we will deliver over 18,000 completions for the full year and make progress towards our medium term targets."

He added that Vistry was looking forward to working with the new government to address the country's housing crisis and was "extremely well placed to support its ambition of delivering the biggest boost to affordable housing in a generation".

Key H1 24 highlights include:

● Adjusted operating profit is expected to be up c.10% on prior year at c. £227m (H1 23: £206.7m) with adjusted profit before tax up c. 7% at c. £186m (H1 23: £174.0m).

● Total completions up c.8% to c. 7,750 (H1 23: 7,143) units.

● On track to deliver more than 18,000 (FY23: 16,118) completions in FY24, underpinned by strong forward sales position, up 21% on the prior year and totalling £5.1bn (2023: £4.2bn).

● Group's sales rate in the period stepped up to an average of 1.21 (H1 23: 0.86).

● Secured new land and development opportunities totalling 8,225 (H1 23: 6,561) mixed tenure homes across 32 sites in the period.

Vistry also says building material costs had been driven down on the previous period, reflecting an easing of supply chain issues, while the group's net debt position dropped from £329m to £323m as of the same date last year.

Vistry added in its report: "The Group continues to execute the £100m share buyback programme commenced in April this year and remains committed to returning £1bn of capital to shareholders within three years through a combination of ordinary and special distributions."

The rise in total completions was attributed to the success of the group's Partnerships model and signalled a "significant outperformance compared to the traditional housebuilding market", the report added.

In a separate statement on the eve of last week's election, Greg Fitzgeraldsaid that the challenges of the housing crisis should be looked at as "a long-term opportunity". 

Mr Fitzgerald said: "House building benefits all of us. It reduces homelessness. It enables young people to see a future in which they have a safe and secure home. It saves local authority spending on temporary accommodation and improves health, education and social inclusion. It provides people with the opportunity to improve their quality of life, creates jobs and drives economic growth.

"Research by Shelter and the National Housing Federation shows that every £1 of taxpayers' money used to fund new, affordable homes results in a payback period to the Treasury of just over four years."

He added: "Labour has promised to deliver 'the biggest boost to affordable housing for a generation'. If they make these changes, we can and will help them deliver it.

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