Trading update

14 May 2025

Trading update

Vistry Group (the Group) is providing an update on trading from 1 January 2025 to date (the period), ahead of its Annual General Meeting which is being held at 12:00 noon today.

The Group has made good progress on executing the key priorities set out in its FY24 results, announced at the end of March, and the Board maintains its expectations for the year.

The Group's sales rate for the year to date has increased since our March announcement to 0.91 (2024: 0.94) from 0.59 and averaged 1.32 (2024: 1.17) in the last eight weeks. The Group's forward order book totals £4.6bn (2024: £4.9bn) of which £2.1bn (2024: £2.1bn) is for delivery this year, with units secured increasing to 72% of forecast FY25 units.

In the Open Market, we have seen an improvement in our sales rate over the past eight weeks and we expect this trend to continue. Mortgage availability and affordability is improving, with lenders increasing their product range and borrowing rates reducing ahead of further expected cuts to the Bank of England base rate. We continue to expect FY25 Open Market volumes to be at a similar level to FY24, with the impact from a reduction in sales outlets as we roll-off our former Housebuilding sites offset by an increase in our Open Market sales rate.

The UK Government's announcement in late March of an additional £2bn of 'top-up' affordable housing funding, to be allocated through the existing Affordable Homes Programme to projects starting by March 2027 and completing by June 2029, has provided positive impetus to the sector. The Group is well positioned on this and has been working closely with a range of partners to identify the best opportunities to secure funding and deliver much needed affordable homes. We are expecting greater clarity around the allocation of this funding following the Spending Review in June, and for this to drive a step up in demand from our affordable housing partners in the second half of the year.

We are seeing strengthening demand from the PRS market and are particularly encouraged by the momentum of investment funds being raised in this sub-sector of the market.

As expected, in the year to date, Partner Funded transaction activity has continued to be at a relatively low level, reflecting investment constraints amongst some of our Registered Provider partners ahead of the new affordable homes funding becoming available. We continue to expect our Partner Funded volumes for FY25 to be at a similar level to last year, with strong momentum going into FY26.

We are seeing some upward pressure on both material and labour prices which we are mitigating, where possible, through proactive engagement with our sub-contractors and suppliers. We continue to expect low single digit build cost inflation for FY25.

The Group is securing attractive land and development opportunities, and in the period secured 1,672 (2024: 6,037) plots across 6 (2024: 19) developments. Whilst we expect the rate of land acquisition to increase as we move through the year, in line with our Partnerships strategy, we are targeting a reduction in the length of our owned landbank in the medium term.

Delivering improved cash generation and ensuring the Group retains a strong financial position is a key priority. We are targeting a steady reduction in average net borrowing through the year and are progressing our programme of underlying initiatives to achieve this. Alongside this, the Group has commenced the process of refinancing its Term Loan and Revolving Credit Facility and expects to complete this during the summer.

The Group is making good progress and continues to expect to deliver a year on year increase in profits in FY25 with, as previously guided, a more significant H2 weighting than in prior years.

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