Vistry Group PLC (LSE:VTY) reported progress on its restructuring and debt reduction initiatives while warning that challenging conditions in the UK housing market continue to affect trading, particularly in its Open Market business.
The housebuilder confirmed that it is implementing measures announced alongside its September half-year results, including reducing its operating regions from 25 to 12, reshaping its land portfolio and targeting £50 million in cost savings during FY2027.
Vistry also reported a forward order book of £3.1 billion, based on the revised definition introduced at its interim results.
Restructuring Programme Targets £50 Million in Annual Savings
Vistry said it is progressing plans to simplify its operating structure and improve financial and operational discipline.
The company is reducing its number of operating regions from 25 to 12, with management teams for the new regional structure already confirmed.
The revised organisation is expected to become operational in January 2027.
The restructuring includes workforce reductions and measures intended to lower overheads, improve accountability and reduce complexity across the business.
Vistry said it is making progress towards delivering £50 million in savings during FY2027.
The changes form part of the company’s revised strategy, which prioritises cash generation, lower financial leverage and improved returns on capital.
Average Daily Net Debt Expected at Approximately £800 Million
Vistry expects average daily net debt of approximately £800 million during the second half of FY2026, reflecting current market conditions and the movement of a limited number of Partner Funded transactions into later in the fourth quarter.
The company continues to prioritise debt reduction through lower Open Market work in progress, land disposals and improved commercial terms on Partner Funded contracts.
Vistry expects its year-end net debt position to remain within the range of analysts’ expectations, although it did not provide a specific figure in the update.
The group has also started refinancing its £900 million term loan and revolving credit facility.
Management intends to reduce average daily net debt during FY2027 and subsequent periods as the land portfolio is reshaped and capital employed across the business declines.
£350 Million Affordable Housing Grant Supports Development Pipeline
Vistry confirmed that it has signed a £350 million grant agreement with Homes England under the Social and Affordable Housing Programme 2026–2036.
The funding, together with allocations secured by the company’s strategic partners, is expected to support its pipeline of affordable housing developments.
The group said Partner Funded activity is gradually increasing as the first wave of programme funding is allocated.
However, the pace of transactions remains relatively slow, reflecting the early stages of grant deployment.
Vistry reiterated that it will prioritise appropriate contract terms, cash generation and investment returns rather than pursuing volume growth at the expense of profitability.
The company expects its revised commercial criteria to support stronger financial performance as Partner Funded activity develops.
Open Market Trading Remains Under Pressure
Vistry reported that conditions in the Open Market housing segment remain difficult, broadly consistent with the environment described at its September results.
Affordability constraints, cautious consumer sentiment and wider economic uncertainty continue to affect buyer demand.
The company is managing selling prices and incentives individually across developments while aligning construction activity with prevailing demand.
Management also highlighted potential short-term uncertainty among first-time buyers following the government’s announcement of its Your First Home initiative.
While Vistry welcomed the proposed support for first-time buyers, it expects some prospective purchasers to delay decisions while awaiting further details about the scheme.
VAT Changes Expected to Support Affordable Housing Delivery
Vistry welcomed the government’s October Budget announcement that a zero rate of VAT will apply to land sold to Registered Providers from April 2027.
The company said the measure should simplify affordable housing delivery and reduce the risk of VAT costs affecting project viability.
Management considers the change supportive of its Partner Funded housing strategy, particularly as affordable housing investment increases under the new government programme.
Finance Leadership Changes Confirmed
Vistry also announced progress in strengthening its senior finance leadership.
Helen Miles has been appointed Chief Financial Officer and is expected to join the company in 2027.
Robert Allen has been appointed interim Chief Financial Officer ahead of her arrival.
The appointments form part of the group’s wider efforts to improve financial oversight and operational control during its restructuring programme.
FY2026 Guidance Supported by Cost and Cash Initiatives
Chief Executive Adam Daniels said Vistry remains focused on creating a smaller and more disciplined business capable of delivering sustainable earnings growth and improved cash generation.
He acknowledged that trading conditions remain challenging, particularly in the Open Market segment, while Partner Funded activity continues to develop gradually.
The company said its restructuring, commercial improvements and debt reduction initiatives are progressing in support of the FY2026 guidance and medium-term strategy outlined in September.
Vistry continues to target a stronger balance sheet and a more efficient operating structure in FY2027, with reduced capital requirements and improved returns remaining central objectives.
More About Vistry Group
Vistry Group PLC (LSE:VTY) is a UK housebuilder specialising in residential development and affordable housing. The company operates through a mixed-tenure model, combining homes sold on the open market with developments delivered in partnership with housing associations, local authorities and other institutional partners.
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