Vistry confirms guidance despite weak private sales

(Sharecast News) - Vistry reiterated its full-year profit guidance on Monday, despite house sales failing to pick up as expected. Updating on third-quarter trading, the FTSE 250 housebuilder said it continued to target adjusted pre-tax profits of £450m for the full year.

Vistry also said "good progress" was being made on its decision to focus fully on its partnership business, which works with the public sector and housing associations to build homes.

The move will see it merge the housebuilding division with the more resilient partnerships divisions, which is less affected by volatility in the wider property market. The unit was formed following the 2022 purchase of rival Countryside Partnerships.

But Vistry warned that private sales activity had remained "subdued, without the normal seasonal pick up since early September and increased use of incentives".

Vistry, like many others in the sector, has seen demand falter in the wake of higher interest rates and record levels of inflation. "This trend has continued and we have not seen the seasonal increase in private sales since September that we had expected," it noted.

The average weekly sales rate since 1 July was 0.60, compared to 0.64 in 2022, or 0.76 in the year to date, down from 0.77 in the same period a year previously. The forward order book totalled £4.3bn.

Total forward sales were 4,278 as at 20 October, compared to 4,284 at the start of September.

Net debt for the full year is expected to be higher than previously expected, at around £450m, which Vistry said reflected the timing profile of completion.

Once the restructure is completed, Vistry will operate as a single business with 27 regional business units, down from 32. The headcount will also be reduced by around 200.