Vistry Group, the UK's leading affordable housing builder, announced a projected pre-tax loss of approximately £30 million for the first half of 2026. This loss is primarily attributed to significant discounting on unsold homes and other cost-cutting measures implemented as part of a strategic overhaul led by CEO Adam Daniels, who took over three months prior. The company's shares fell by as much as 12% following the announcement.
The strategic overhaul includes a reduction in Vistry's regional footprint, land bank, and work-in-progress levels. The company also confirmed it would cease part exchange operations, which involve buying a homeowner's existing property as part of a new home purchase, a move expected to improve average debt and reduce invested capital by £50 million. The company aims for annual overhead savings of approximately £25 million through a voluntary exit scheme and more selective hiring.
Despite the first-half loss, Vistry expects to deliver an adjusted profit before tax of £200 million for the full year ending December 2026, in line with current market consensus. This forecast relies on a significant improvement in profitability in the second half of the year, driven by the ongoing restructuring efforts. The company is also targeting a net cash position exceeding £100 million by year-end and a substantial reduction in average net debt levels. Net debt at June 30, 2026, was £470 million, with average daily net debt in H1 at £799 million.
Analysts have reacted with mixed views. RBC Capital Markets housing analyst Anthony Codling questioned Vistry's guidance, suggesting the company missed an opportunity to acknowledge potential negative impacts from changes in the UK government and declining market conditions in Q2 on future quarters. However, Vistry's management remains confident that the repositioning efforts will lead to long-term success and healthy profitability, treating 2026 as a transition year to operate with significantly lower financial leverage.
