By Christian Moess Laursen and Joe Hoppe
Vistry Group backed its full-year profit guidance and said it would revise its shareholder payout plan, as it refocuses its business strategy to focus on its high-return partnerships model.
The housebuilder said Monday that its pretax profit for the first half rose slightly to 114.2 million pounds ($142.4 million) from GBP111.35 million in the prior-year period. Revenue climbed to GBP1.575 billion from GBP1.19 billion, driven by a 40% increase in legal unit completions, it said.
Adjusted pretax profit–which strips out exceptional and other one-off items–was GBP174.0 million, down 8.4%. Still, the company reiterated its full-year guidance of an adjusted pretax profit above GBP450 million.
The company said it has revised its business strategy and will now fully focus on its high-return partnerships division, which pairs up with government and housing associations to deliver affordable, mixed tenure housing. It said it expects a significant release of capital as assets from the housebuilding unit are redeployed into the partnerships division.
Vistry said that as the scale and social need for affordable housing continues to increase, it was clear it was uniquely placed and the decision to refocus the business best enables sustained growth in housing output and provides better benefits to partners, while maximizing value and long-term shareholder returns.
The company said it expects to fully merge its two units before the end of the year.
“Delivering on the acute social need for housing across the country and increasing the availability of affordable, sustainable homes is at the core of the group’s social purpose and vision, and I look forward to delivering upon this exciting and unique opportunity for Vistry,” Chief Executive Greg Fitzgerald said.
Vistry said it will launch a share buyback program of GBP55 million, which will begin in November and be completed ahead of full-year results in March, as it targets GBP1 billion total shareholder distributions over the next three years. The buyback is in lieu of any dividend payments, it said.
Write to Christian Moess Laursen at [email protected] and Joe Hoppe at [email protected]
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