Housebuilder issues update amid expected controversy over remuneration package at AGM

Housebuilder Vistry has raised its pre-tax profit forecast for the 2023 calendar by £10m on the back of “improving market conditions”.

The firm, which bought partnerships housebuilding specialist Countryside last November, said it now expects “adjusted” pre-tax profit for the year to be in excess of £450m, up from the £440m it was guiding the market to expect back in March.

Greg Fitzgerald

Greg Fitzgerald said market conditions were ‘improving’

The firm said its weekly private sales rate had soared in recent weeks to an average of 0.83 homes per site in the year-to-date, albeit this figure included the impact of a number of significant bulk sales.

However, without taking account of the bulk deals, the firm said its weekly sales rate had still increased to 0.65 homes per site to date, well up on the 0.54 reported at the time of its full year results in March.

Th numbers came in a trading update issued ahead of Vistry’s annual general meeting today, where the housebuilder’s top team is expected to come under fire from institutional investors over its remuneration package, with shareholder advisory agencies ISS and Glass Lewis reported to be advising shareholders to vote against the remuneration report.

The firm’s chief executive Greg Fitzgerald said: “We have continued to see improving market conditions and the group has traded in line with our expectations for the year to date. Partnerships is demonstrating the resilience of its business model and is expected to deliver revenue growth in FY23 against proforma FY22.”

The firm said its order book had hit £4,48bn, of which £3.07bn stemmed from partnerships, and £1.4bn the firm’s housebuilding operations.

Vistry has recently set itself a target to build 20,000 homes per year, an aim which, if achieved, would make it the largest housebuilder in the UK.

The news came as Vistry subsidiary Countryside Partnerships announced it had secured a contract from Brent council to build 200 homes on the South Kilburn estate regeneration scheme, of which 95 will be affordable. Alongside the firm’s existing contract in the area, this new commission will mean Countryside will deliver 547 homes in South Kilburn in total.

However, the firm did say that in its housebuilding operations, “The expected year on year reduction in private sales rates is reflected in our build rates”. Vistry’s statement added: “Housebuilding is seeing high, sustained levels of interest and an improving trend on private sales rates. With a highly experienced management team, the business is maintaining a controlled approach focused on operational excellence, capital management and tight cost control.”

The concerns raised over the existing remuneration package come amid reports that the firm’s US shareholders are separately pushing for a much bigger incentive scheme in the firm which could see Fitzgerald net £60m. Since the reports emerged, two of the non-executives previously on the remuneration committee resigned, with two new appointments made, one of which, Paul Whetsall, has experience in the US housebuilding sector. This, however, is not due to be voted on today.