Vistry’s 2020 profit ahead of expectations

Vistry Group achieved an adjusted pre-tax profit ahead of expectations in 2020, with total completions for the year at 6,131. However, the firm reported that its Housebuilding business was particularly affected by Covid-19 in the first half.

During the year ending December 31 2020, the business achieved an adjusted pre-tax profit of £143.9 million, ahead of the originally expected “top end” of a £130 million to £140 million range but down on 2019’s £188.2 million.

After reopening its sites in late April, following the market shutdown at the end of March, Vistry said its sales quickly increased, with sustained strong demand ensuing in the second half and fuelling a 15% increase in its weekly private sales rate against H2 2019 to 0.62. It also saw consumers continue to reserve homes during the second national lockdown in November and the start of December.

Total legal completions rose 58.6%, driven by Bovis’ acquisition of Galliford Try’s housebuilding divisions to form the group at the start of 2020.

On a proforma basis, completions in the Housebuilding business – consisting of the Bovis and Linden brands – fell from 6,884 in 2019 to 4,652 homes in response to the pandemic. Their average selling price was £302,500, with adjusted revenue from Housebuilding activities in the year totalling £1,312 million against the previous year’s £1,821 million.

Meanwhile, Vistry Partnerships “made good progress” in 2020, with its mix of pre-sold units and contracting revenues demonstrating its resilience, Vistry said. Mixed tenure completions – also on a proforma basis – increased 28% to 1,479.

Vistry said it had already secured 64% of its total Housebuilding and Partnerships mixed tenure forecast units for 2021, totalling £1,747 million.

In a “strong start” to 2021, the company’s private sales rate per active site per week for the first eight weeks was 0.66 against 2020’s 0.64. Assuming stable market conditions, the business hopes to more than double its adjusted pre-tax profit to “at least” £310 million for this year.

Greg Fitzgerald, Vistry’s ceo, said: “The group has achieved an enormous amount in 2020, and despite the challenges I am in no doubt we start 2021 as a stronger business.We had a strong second half performance with a sustained step up in demand, firm pricing, and a robust supply chain.

“Our firm focus on cash management resulted in a year end net cash position of £38 million. As a result of these actions and our positive performance, the board is pleased to resume dividend payments with a proposed final dividend of 20 pence in respect of 2020.”