Firm had originally said 2024 number would be £430m but problems at South business slashed figure
Vistry is rejigging its divisional structure as it attempts to get to grips with a series of problems that saw it issue three profit warnings in as many months last year.
The firm expects to make a pre-tax profit of £250m for 2024 when it publishes its results in the spring.
But the figure is 40% lower than the housebuilder’s original forecast of £430m and nearly £170m down on 2023’s figure of £419m.
Its first two warnings last year concerned cost issues in the business’ southern division, which are now estimated to total £105m in FY24, a further £50m this year and £10m beyond.
A third warning, made on Christmas Eve, cited delays to a number of partnership agreements and a decision not to proceed with some anticipated land transactions.
In a scheduled update this morning, Vistry said it was cutting its operating divisions from six to three, each led by an executive chair reporting directly to chief executive Greg Fitzgerald.
It said all executive chairs are former divisional chairs and members of the executive leadership team.
They will be supported at divisional level by newly appointed divisional commercial directors, divisional operational directors and divisional finance directors.
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It said the changes were aimed at reducing reporting lines and enabling the chief executive to “get closer to the business”. Last November, the firm announced the departure of chief operating officer Earl Sibley.
In this morning’s update, Vistry said it was tackling the problems at the South business and added: “A significant amount of work has been done to understand and address the issues faced in our former South Division and with new operational leadership in place, we are confident we will make rapid progress in stabilising the affected regions within this business area in FY25.”
It added that it had tightened up procedures around monthly site cost reviews and an investment in increased commercial assurance.
In a note, broker Investec, which last week queried Vistry’s medium-term profit targets, said: “Sensibly, the key messages seem to be that cash generation will be the priority over growth in FY25, with reducing stock and WIP a clear priority.”
Vistry is due to announce its results on 26 March – they were originally pencilled in for 6 March – and will reveal that revenue has increased 9% to £4.4bn with completions up 7% to 17,200.
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