Vistry Group PLC on Monday said it will cut up to 200 jobs as it shifts its focus to solely building affordable homes in the UK.
Shares in Vistry were down 5.3% at 686.50 pence each in London on Monday morning.
The Kent-based housebuilder also said it will slim its number of regional business units to 27 from 32.
This comes after Vistry announced last month it was changing its strategy to focus solely on building affordable homes through its ‘high return’ Partnerships division, to help address the UK’s ‘chronic shortage of affordable mixed tenure housing’. It expects to deliver around £25 million of annualised cost savings as a result of the restructuring.
Vistry expects adjusted pretax profit in 2023 of £450 million, excluding the impact of transitioning the Housebuilding business to Partnerships, up from £418.4 million in adjusted profit in 2022.
‘As previously described, this impact is created by the re-evaluation of the ful-life margin of the group’s Housebuilding sites to reflect the increased pre-sale elements and the associated discount in price,’ Vistry explained.
Vistry said it estimates the final 2023 impact of the reduction in full-life margins of its Housebuilding sites to be in the region of £40 million. As a result, its targeted adjusted pretax profit for 2023, including this impact, is £410 million.
Turning to current trading, Vistry said its average weekly sales rate since July 1 has been 0.60 per site, down slightly from 0.64 a year before. Its forward order book totals £4.3 billion, with all private units for 2023 already forward sold.
Vistry said it remains confident its provision for fire safety remediation will will cover the cost of the work required.
Average net debt for 2023 is expected to be higher than previously expected at £450 million, though net debt is expected to be down to £100 million by December 31.
Vistry also confirmed plans announced in September to conduct a £55 million share buyback. It expects to complete this before its 2023 results announcement in March next year.
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