Vistry CEO to scale back housebuilder after profit warning and mounting charges

By Simone Lobo and Raechel Thankam Job

Sept 24 (Reuters) - Vistry lowered its annual profit expectations and fleshed out plans on Thursday to shrink into a smaller housebuilder, as new CEO Adam Daniels moved to fix a business he said had grown too fast and let its execution slip.

Shares in Vistry, down more than 50% so far this year, fell more than 10%.

Under a review led by Daniels, who took over in April, Vistry will pare back its regional footprint and exit private sales in the South East of England, taking a £470 million ($623 million) hit from the overhaul.

RETREAT FROM EXPANSION

The overhaul reverses the acquisition-led expansion pursued under predecessor Greg Fitzgerald, who built Vistry into Britain's largest affordable homebuilder through a shift to partner-funded developments.

Daniels said Vistry's mixed-tenure strategy was the right one, but the company must now operate with greater control.

"A big focus on short-term targets and growth compounded the misalignment between profit and cash," he said on a call with analysts.

Vistry is now targeting about 12,000 completions per annum over the medium term, down from around 20,000 set under Fitzgerald, and to consolidate from 25 to 12 regions.

The actions mean the company will not need to raise new equity, Daniels said.

In the South East, Vistry will focus on partner-funded construction and exit private sales in the region. The broader South division drew scrutiny in recent years over an accounting issue.

Vistry will appoint a new finance chief imminently, it said, after Tim Lawlor announced plans to leave by next month.

LOSSES AND CHARGES

It cut its fiscal 2026 adjusted pretax profit expectation to about £165 million from a previous forecast of £200 million.

"Further cuts to guidance have to stop before investor confidence can start to return," Quilter analyst Oli Creasey said.

Vistry has issued a string of profit warnings since 2024, and this year the Iran war has driven up costs and slowed sales across the sector.

Its fiscal 2027 profit forecast of about £185 million is below market estimates.

The company swung to an adjusted pretax loss of £83.3 million for the six months ended June 30.

($1 = 0.7550 pounds)

(Reporting by Simone Lobo and Raechel Thankam Job in Bengaluru; Editing by Ronojoy Mazumdar, Kevin Buckland and Emelia Sithole-Matarise)