Vistry Group Reports £30M H1 Loss, Restructuring Charges Hit Shares

Vistry Group, a developer specializing in affordable housing, reported a £30 million loss in the first half of 2026, reversing a prior-year profit. The company’s adjusted profit before tax (APBT) guidance for FY 2026 was revised downward to £125 million from an earlier estimate of £200 million, reflecting one-off charges and operational challenges. These included a £475 million goodwill impairment tied to a revised strategic model, a £79 million Building Safety Charge, and £50 million in discounting impacts. Despite a £20 million cash boost from exiting a part-exchange position in Q3, the company’s net cash outflow in H1 was £27 million after recoveries. Land creditor reductions of £100 million in the first half, with further cuts expected to £300 million by year-end, also weighed on profitability. Meanwhile, private work-in-progress (WIP) progress totaled £380 million, with £300 million recorded earlier in the year and £80 million since the half-year review. The company’s share price fell 5.45% to $253.40, closing below its 52-week high of $746 and above its low of $220, reflecting investor concerns over restructuring costs and revised guidance. Adam Daniels, appointed as CEO in April 2026, outlined a sweeping restructuring plan to simplify operations: consolidating 25 regional structures to 12, reducing standard house types from 100 to 35, and merging three private sales brands into one, Linden. The company aims to shift its tenure mix toward 60% partnerships and 40% open-market sales, targeting a smaller land bank of 36,000 homes and a medium-term volume of 12,000 homes annually by FY 2031. Financial targets for FY 2027 include an APBT of £185 million, a £50 million overhead savings program, and a net debt average of £500 million. The company also secured a £350 million grant under the Social Affordable Housing Programme (SAHP), the top allocation among 33 partners. Trading performance showed mixed results: 59% of sites performed well, with an average gross margin of 18.5%, while unit volumes declined 8% year-on-year, offset by a 3% rise in average sales prices. The CFO noted that banks had waived interest cover covenants for FY 2026 and H1 2027, easing some financial pressure. The company’s borrowing costs dropped to 6% from 6.5% in the prior year, though the restructuring and one-off charges remain a key drag on investor sentiment.