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Shares in Vistry have risen sharply after the housebuilder said consumer confidence was growing and its merger with Countryside was proceeding better than expected.

Announcing full year results for 2022, the housebuilder and partnerships housing provider, which pulled off a 拢1.1bn takeover of rival Countryside in November last year, added that it expected to increase profitability this year, despite the tough economic conditions.

Shares in Vistry traded up by more than 4% at one point after it said it now expected annual 鈥渟ynergy鈥� cost savings from the merger with Countryside to total 拢60m, 拢10m more than previously targeted, and that annual 鈥渁djusted鈥� pre-tax profit 鈥� prior to exceptional items 鈥� for the current year will top 拢440m, well above the 拢418m reported for 2022.

The firm also said that it had seen 鈥渁n improving trend on private sales in the first 11 weeks of the year鈥�, with private reservations in its housebuilding business having grown as high as 0.62 per site per week in the last four weeks, compared to 0.46 in the fourth quarter of 2022.

The firm said weekly reservations per site for the year as a whole so far were running at 0.54. It said: 鈥淲e have seen increased consumer confidence from Q4 2022, particularly as mortgage rates have trended downwards and availability has improved.鈥�

The reservations figures for the last four weeks are ahead of the numbers seen in 2019, the last 鈥渘ormal鈥� year prior to the pandemic, the firm said.

Vistry added it was also seeing a 鈥済ood level of demand from Housing Associations and Local Authorities鈥� in its partnerships housing business, and that its forward order book was 57% ahead of the same point last year, given the combination of Vistry and Countryside, at 拢4.18bn.

But, despite this positive outlook, Vistry as expected reported full year results impacted by the requirement to make provisions for fire safety repairs and the Countryside acquisition costs.

The firm said its statutory pre-tax profit was 拢248m, down 22.5% on 2021, with the figure including a 拢97m fire safety provision and 拢56.9m in transaction and integration related costs. Statutory revenue was 拢2.73bn, up 13.4%, with the addition of the Countryside business making just a minimal impact on the numbers.

The firm said the partnerships business will in future make up more than half of the revenue of the organisation and was on course to grow revenue this year in line with its strategy.

Greg Fitzgerald, Vistry chief executive, said 2022 was a 鈥渓andmark year鈥� for the group despite the challenging market conditions experienced in the fourth quarter, with the combination with Countryside creating one of 鈥渢he country鈥檚 leading homebuilders鈥�.

He added: 鈥淭he businesses have come together extremely well with a good cultural fit, and the integration process is making excellent progress. As a result, we are confident of delivering annualised synergy benefits of c. 拢60m, ahead of our original target.

>> See also

>> See also

鈥淢arket conditions are improving and based on the assumption that private sales rates continue to trend towards levels seen in 2019, we expect Group adjusted profit before tax for FY23 to be in excess of 拢440m.鈥�

The firm also confirmed the retention of the timber frame factories formerly owned by Countryside, , which came over as part of the deal. It said it had branded the three factories as Vistry Works, with the two existing operational facilities in Warrington and Leicester having the capacity to deliver 2,800 homes to the business in the current financial year.

It said the third facility, a vast new build unit in the East Midlands which Countryside had decided to sell prior to the merger, will be re-opened in the second half of this year, with the capacity to produce 5,000 homes per year.

Vistry also announced the appointment of a new board member, Jeffrey Ubben, who is founder and managing partner of Inclusive Capital Partners, a San Francisco-based investment firm that became one of Vistry鈥檚 largest shareholders following the takeover of Countryside. The activist investment firm was a major shareholder in Countryside and last year made two attempts to takeover the firm, before throwing its weight behind the Vistry deal. Inclusive holds just under 6% of the shares in Vistry.