Vistry reveals further £50 million profit hit

Vistry has identified a further £50 million profit hit from the cost issues facing its South Division, taking the total impact to £165 million.

Last month Vistry revealed problems in its South Division saying that the total full-life cost projections to complete nine out of its 46 developments, including some large-scale schemes, had been understated by around 10% of the total build costs. At the time Vistry's expectations were that adjusted profit before tax would reduce for FY24 by around £80 million, for FY25 by around £30 million and for FY26 by around £5 million.

Following independent and internal reviews, Vistry now expects a further profit impact of £25 million this year, £20 million in FY25 and £10 million in FY26. The reviews covered all six of Vistry’s divisions and 26 regional business units and found no systemic issues outside the South Division and that the issues in the South Division principally relate to sites from the former Housebuilding business.

In a trading statement today, Vistry said: “The significant issues have been found to be confined to the South Division and can be attributed to insufficient management capability, non-compliant commercial forecasting processes and poor divisional culture. The …