22nd Mar 2023 09:28
(Alliance News) - Vistry Group PLC on Wednesday said annual profit fell despite an uptick in revenue, as this was more than offset by rising cost of sales, alongside other expenses.
The Kent, England-based housebuilder said 2022 pretax profit was GBP247.5 million, falling 23% from GBP319.5 million in 2021.
This was despite revenue rising 13% to GBP2.73 billion from GBP2.41 billion, as cost of sales outpaced this, rising 18% to GBP2.32 billion from GBP1.97 billion, while exceptional cost of sales multiplied to GBP96.1 million from GBP5.7 million.
Administrative expenses also increased by 33% to GBP258.9 million from GBP194.5 million.
As a result, Vistry declared a reduced final dividend to shareholders from a year earlier, falling 20% to 32 pence from 40p, taking the total 2022 dividend to 55p, down 8.3% from 60p.
Shares in Vistry were up 3.9% to 760.50p each in London on Wednesday morning.
Chief Executive Greg Fitzgerald stressed 2022 represented an improvement for Vistry.
"2022 was another landmark year for the group as we delivered a step up in financial performance and made excellent progress across all areas despite the more challenging market conditions experienced in the fourth quarter," said Fitzgerald.
Referring to Vistry completing the acquisitions of Countryside Partnerships in November, he continued: "The combination with Countryside presents a unique opportunity and has created one of the country's leading homebuilders, comprising a leading partnerships business and a high quality major housebuilder. It has accelerated the group's strategy of rapidly growing its more resilient partnerships revenues and of targeting sector leading return on capital employed.
In current trading post-year-end, Vistry said its Partnerships business is seeing a good level of demand from housing associations and local authorities, with the private rental sector market also improving.
For the group as a whole, it said it saw an improving trend on private sales in the first 11 weeks of the year, with the group's average private sales rate per site per week for the year to date at 0.54, increasing to 0.62 in the last four weeks. It cited increased consumer confidence from the fourth quarter of 2022, "particularly as mortgage rates have trended downwards and availability has improved".
Looking ahead, Vistry said it expects to deliver 2023 adjusted pretax profit in excess of GBP440 million, up at least 5.2% from GBP418.4 million in 2022, also on an adjusted basis.
It added it will continue to ensure the group has a "healthy and resilient" balance sheet and will continue to invest "selectively in high quality land and development opportunities as they arise".
"We are focused on maximising the opportunities from our unique market position and increasing the supply of high quality housing across all tenures. The resilience of our Partnerships business is reflected in its strong forward order book which gives us the confidence that the business will deliver growth in 2023 revenues in line with its strategy," Fitzgerald added.
By Greg Rosenvinge, Alliance News reporter
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