Vistry wipes £50m more off profit following build costs error investigation

Vistry’s investigation of build cost underestimation in developments in its South division has found that it will make a total impact of £165m on profit. Last month, it had said that it expected the impact to be around £115m.  Since then, the housebuilder has revealed the findings of the independent and internal reviews regarding the issues in its South division. It said these could be attributed to “insufficient management capability, non-compliant commercial forecasting processes and poor divisional culture”.   It also said that there were “no systemic issues found outside the South division”. Vistry said the division was led by a management team from the group’s former housebuilding business. It added that none of the group’s other divisions are managed exclusively by former housebuilding management.  The independent review highlighted the pressure being felt from organisational change as a fundamental driver underlying the issues in the South division. The group now expects to deliver adjusted profit before tax in FY24 of £300m. It also expects to deliver total completions in FY24 of 17,500 homes, with the total average selling price at a similar level to the prior year.