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Highlights

  • Increased Completions: Total home completions rose by 7% to 17,225 units, with Partner Funded completions up 18%, while Open Market completions declined by 15%.

  • Financial Underperformance: Adjusted profit before tax fell to £263.5m from £407.3m in 2023 due to cost forecasting issues in the South Division.

  • Financial Position Improvement Plans: Plans for improved cash generation, debt reduction, and a £200m cut in excess working capital.

Vistry Group PLC (LSE:VTY) has released its full-year results for 2024, reporting a 7% increase in total completions to 17,225 homes (2023: 16,118). The rise was driven by an 18% increase in Partner Funded completions to 12,633, offset by a 15% decline in Open Market completions to 4,592.

The company emphasized its commitment to delivering high-quality housing, expecting to receive a 5-Star Home Builders Federation (HBF) Customer Satisfaction rating for the sixth consecutive year in 2025.

Financial Performance and Cost Challenges

Despite progress in homebuilding, Vistry faced financial setbacks, with adjusted profit before tax dropping to £263.5m from £407.3m in the previous year. The decline was primarily due to forecasting issues in the South Division, which had a total financial impact of £165m.

Cash Flow and Capital Allocation Strategy

For 2025, Vistry aims to reinforce its financial position through cash generation and a steady reduction in net borrowings. A key focus will be reducing excess working capital by approximately £200m, addressing an accumulation of Open Market stock.

To improve cash flow, tighter financial controls have been implemented at the site level, with weekly executive monitoring. Additionally, the company is exploring ways to accelerate cash release from its former Housebuilding landbank, considering bulk sales and discounting strategies.

Forward Orders and Market Outlook

As of mid-March 2024, Vistry’s forward order book stood at £4.4bn, with 65% of forecasted 2025 units already secured.

Sales performance in early 2025 has been slower than the previous year, with a sales rate of 0.59 per site per week (2024: 0.81). This dip reflects lower Partner Funded transactions in the first quarter. However, Partner Funded activity is expected to increase in the second half of the year, supported by the allocation of £2bn in new affordable housing funding.

While Partner Funded volumes in 2025 are projected to match 2024 levels, momentum is expected to strengthen further in 2026. In the Open Market segment, a recent uptick in sales over the past four weeks suggests a gradual recovery, with volumes in 2025 expected to remain consistent with 2024.