Vistry Group PLC (LSE:VTY) warned that first-half profit will be "significantly lower" than last year and has paused its share buyback programme as the housebuilder ramps up incentives and discounts to accelerate sales and improve cash generation.
The partnerships-focused builder said trading since the start of 2026 had been affected by macroeconomic uncertainty that has increased since its results in March, with weaker market conditions hitting the second quarter.
Vistry said it expects second-half profit to match the prior year, helped by an improved margin mix on active sites and stronger demand from affordable housing partners, with full-year adjusted pre-tax profit expected around the middle of analysts’ forecasts.
Overall sales so far this year are up 32% to 1.20 sales per outlet per week from 0.91 a year earlier, with open market sales rates remaining around 30% ahead of last year.
However, the company said open market activity had moderated in recent weeks because of uncertainty linked to the Middle East conflict.
Vistry has paused its share buyback programme as part of a wider push to reduce debt and now expects to end 2026 with net cash of more than £100 million.
The group said improving cash generation and reducing debt remains its main priority for 2026, with increased efforts to sell completed and near-completed homes, tighter discipline on partner deals and slower build rates on some sites.
It has also adopted stricter hurdles for land purchases while market conditions remain volatile.
While first-half average net debt is expected to rise because of higher land payments and slower completions, Vistry said the measures should deliver “significantly lower” debt levels in the second half.
Activity from affordable housing partners has been “relatively subdued” as the sector transitions between funding programmes, though demand is expected to increase later in 2026 after grants under the government’s new Social Affordable Housing Programme are confirmed in the third quarter.
New chief executive Adam Daniels, promoted from a regional CEO role last month, is leading an operational review, with findings due alongside interim results in September.
The board and Daniels said they remain “fully committed” to the group's differentiated model that focuses more on its partnerships strategy than rivals.