TIDMVTY
RNS Number : 4077N
Vistry Group PLC
20 May 2020
20 May 2020
Vistry Group PLC
Trading Update for the period covering 1 January 2020 to
date
Vistry Group PLC (the "Group") is today providing an update on
trading in the period from 1 January 2020 to date including the
Group's ongoing response to COVID-19, and on its progress with the
integration of the enlarged Group, ahead of its Annual General
Meeting ("AGM") which is being held at noon today.
Greg Fitzgerald, Chief Executive commented:
"In these unprecedented times, the Group's performance during
lockdown has been better than initially expected in respect of
reservations, completions and cash management. We are pleased by
how effectively our site management and health and safety teams
have adapted to the new operating procedures. As a result, we
currently have more than 5,600 operatives working safely across our
developments and expect productivity to continue to increase.
"The continued strength of Vistry Partnerships throughout the
past two months has proven our rationale for the acquisition, which
has given us a highly resilient business underpinned by significant
demand for affordable homes."
Current trading
Partnerships
Vistry Partnerships had a strong start to the year, progressing
its strategy of accelerating revenue growth and margin expansion
through an increase in land-led contracting and mixed tenure
development.
Our Partnerships business has led our return to site and is the
most resilient part of our business in the current market
conditions given the high proportion of revenue from contracting
and pre-sold developments, which provides a high level of cash
realisation. Over 70% of normal production capacity has already
been restored as our teams get used to the new COVID-safe operating
procedures.
We are operating across all of our 73 contracting sites and
continue to increase the future pipeline. The contracting forward
order book totals GBP827m.
In respect of Partnerships development activity, we are
operating on 31 of our 34 sites. Interest from housing associations
and investors continues to be strong, and demand from private
buyers is improving steadily.
Housebuilding
In the first 11 weeks of trading in 2020, we saw a strong
increase in the average sales rate per site per week, accompanied
by some positive momentum on pricing. The business first reported a
material impact on trading from COVID-19 from mid-March.
Our sales teams have successfully remained open to business
throughout, taking virtual tours, new reservations, progressing
exchanges and handing over completed homes during the period of
lock down. Our sales offices have now reopened for appointments and
the Group sees significant opportunity from increasing the use of
online channels for all future customer interactions.
Over the past eight weeks we are encouraged to have taken 447
gross private reservations, resulting in 300 reservations net of
cancellations. The rate of sales has been an improving trend, with
a sales rate of 0.26 over the past three weeks. We have exchanged
on 310 homes and legally completed a total of 257 private sales in
the eight-week period. Our pricing over the past eight weeks has
been broadly in-line with our forecasts. In addition, levels of
website traffic and prospects have been strong, and in recent weeks
have returned to the levels we saw in January and February,
indicating continued strong demand.
The Group has a strong forward sales position, with
housebuilding reservations (including Vistry Partnerships
development activity) totalling GBP1.5bn (including joint
ventures)*.
We are currently operating on 119 out of a total 172
housebuilding developments and expect this to continue to increase.
Our focus remains on the completion of homes which are watertight
and where we have clear visibility of completion and cash
realisation.
Business integration
We are very pleased with the progress made on integration and
are ahead of where we expected to be at this stage. The new
operating and reporting structures are in place and working
effectively, with the rollout of consistent IT systems being the
only outstanding programme.
We have extended the review of the Group following the
acquisition, to further leverage the scale of the combined
businesses. We are consulting with our teams, and anticipate that
this will result in further headcount reductions, producing annual
equivalent savings of c. GBP9.5m, increasing our anticipated total
synergy savings to over GBP44m. The cost of these further savings
is expected to be achieved within the total GBP35m exceptional
restructuring costs previously announced.
Funding and liquidity
The Group remains financially strong. As at 18 May, the Group
had net debt of GBP476m (21 April 2020: GBP440m) and committed
banking facilities totalling GBP770m, with well spread maturities
out to 2027.
We are pleased to have received confirmation that Vistry Group,
subject to the Bank of England approving relevant documentation, is
eligible in principle to access funding under the Covid Corporate
Financing Facility ("CCFF"), should that be required.
*Total forward sales of GBP1.5bn includes GBP0.2bn in respect of
our joint venture partners' share of revenue
This announcement includes inside information as defined in
Article 7 of the Market Abuse Regulation No. 596/2014 and is being
released on behalf of Vistry Group plc by Earl Sibley, Chief
Financial Officer.
For further information please contact:
Vistry Group PLC 01242 388789
Earl Sibley, Chief Financial Officer 020 7250 1446
Susie Bell, Head of Investor Relations
Powerscourt
Justin Griffiths, Nick Dibden, Victoria
Heslop
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END
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