Vistry posts record pre-tax loss amid housebuilding crisis

“In parallel, we have now completed an extensive review of our business and operating model including how best to position the Group for future success, the conclusions of which we are communicating today alongside our half year results. 

“The review confirms that Vistry has strong fundamentals: a differentiated mixed-tenure model, deep partner relationships, a quality product, exposure to structurally attractive affordable and partner-backed housing markets and highly motivated people.”

Daniels added: “Whilst the challenges we have experienced in the last couple of years have been exacerbated by market headwinds, the review has also made clear that our execution, regional discipline and capital allocation have not been consistent enough.

“These issues can be fixed, and we are taking the necessary steps to ensure the strong performance we have seen across many of our sites is replicated across the Group as a whole. 

“Achieving this has necessitated an urgent focus on increasing operational control, releasing cash, reducing complexity and establishing a base from which we can deliver more consistently.”

He said: “We are committed to entering 2027 on the right footing and following the actions taken, do not anticipate any need to raise equity. 

“I am pleased to say that we expect to announce the appointment of a high-quality new CFO imminently who will support me with the delivery of our strategy.

“We are repositioning Vistry as a specialist mixed-tenure housebuilder that will deliver consistent, cash-backed growth in earnings alongside highly attractive returns on capital.”

He added: “To achieve this the Group will need to be smaller, more focused geographically and with increased discipline and control in operational delivery and allocation of capital. 

“Managed realisation of value from our asset base will support further de-leveraging, ensuring the Group has a robust platform from which to operate. 

“I am confident Vistry will continue to be the UK’s leading specialist mixed-tenure housebuilder, delivering high-quality Open Market, Affordable and Private Rented Sector homes where they are needed most.”

He said: “This is the right model for Vistry and one which gives it the potential to thrive, benefitting from structural demand for affordable and mixed-tenure housing. 

“Our product and differentiated offering continue to be valued by customers and partners, reinforcing our leadership in the sector. 

“We are pleased that the recent announcement of the first wave of the Social and Affordable Housing Programme (2026-2036) has given confirmation of future funding totalling £9.58bn to 33 Strategic Partners, 29 of which we currently work with.” 

He added: “Vistry was named as a Strategic Partner and secured a significant direct grant award of £350m, the largest award given in this phase. 

“This is significantly in excess of the first award received under the previous programme and will enable us to directly deliver over 3,000 affordable homes. The process of building these homes has already started.

“The CEO Review has provided strategic clarity with a deliverable plan and clear commitments across capital, operations and culture. 

“This gives me great confidence that we can return Vistry to a business that consistently creates value for shareholders and delivers exceptional outcomes for all stakeholders.”

Julie Palmer, managing partner at BTG, said: “Efforts to improve its cashflow alongside a government announcement of £350m to support building affordable housing may have seen Vistry Group begin navigate away from deep water and back towards dry land. 

“However it is by no means out of the woods yet and cannot afford to rest on its laurels. 

“Reports of late payments to suppliers and withdrawal of credit insurance cover for the housebuilder mean Vistry must be focused on making sales and generating cash to prove to shareholders, suppliers and partners that it is back on solid foundations.”

Palmer added: “Unfortunately, it seems that there will be no end to the woes faced in the first half of its financial year. 

“Conflict in the Middle East looks set to continue, bringing persistent inflation, soaring costs and low confidence along with it. 

“If energy bills rise with mortgage rates, the housing market is going to remain stagnant, and we will see more and more housebuilders struggle to generate cash needed to pay their own way.”

She said: “Vistry will be hoping its partnerships with housing associations and institutional private landlords will circumvent the lack of demand and confidence from the private homebuyer market to provide a solid pipeline of sales. 

“Volume of transactions from this will be particularly crucial to bringing more cash in if margins are squeezed further by material cost inflation and other operational cost increases.

“The construction industry cannot take much more of being stuck in this limbo.”

She added: “If we see the larger housebuilders like Vistry lose their foothold, they could take swathes of smaller firms, contractors and sole traders down with them. 

“This means meeting housing demand will be even more out of reach, while the wider economic impacts batter an already damaged UK economy. 

“Construction companies of all sizes will be anxiously anticipating the Budget to see what action the government plans to take to address the business financial distress in the sector and try to get the housing market kickstarted before it is too late to recover.”