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More than £430m has been wiped off the value of housebuilder Vistry Group after it blamed delayed deals for a third profit warning in as many months.
Investors pulled hundreds of millions from the housebuilder following an announcement that profits were likely to be £250m this year, down from previous guidance of £300m.
Vistry blamed its performance on delays to deals with partners – with transactions expected to close in 2025 rather than this year – and to some developments that have not been completed.
The housebuilder, which builds more than 17,000 homes per year in the affordable and rental markets, also ditched “a number” of proposed deals “where the commercial terms on offer were not sufficiently attractive”. It said it expected more attractive options to appear next year.
Shares have dropped by around 40pc from the start of 2024 on the back of Vistry’s financial woes. The business is trading at its lowest point in two years, with its stock down by around 17pc on Tuesday morning.
The news weighed on rival housebuilders, with shares in FTSE 250 peer Crest Nicholson down by 2pc and listed rivals Persimmon, Barratt Redrow, Taylor Wimpey and Bellway posting slight declines.
It has been a turbulent few months for Vistry, which has already warned on its profits twice after miscalculating building costs in its South division, which covers areas including Kent, Sussex, Hampshire and the Thames Valley, west of London.
An external review of the housebuilder found in October that there were 18 sites where cost calculations were off by more than £1m in the division. Outside of that division, there were small issues identified that dented its profit by a further £8m.
Anthony Codling, of RBC Capital Markets, said Vistry’s woes had been compounded by the impact of the Chancellor’s Budget, causing local authorities, registered providers and other partners to slow down their purchasing decisions. Higher-than-hoped-for mortgage rates have also been a problem.
Economists have blamed Rachel Reeves’s Budget for driving up borrowing costs. Last week, UK 10-year bond yields rose to their highest levels in a year as investors fretted about how she would fund her spending plans.
Inflation has soared to an eight-month high, with analysts predicting further price rises.
Mr Codling said the loss of momentum would “impact the pace” of Vistry’s growth next year.
He said: “On a day when most are winding down or driving home for Christmas, Vistry delivered a present with a sting in its tail – another profit warning, the third and hopefully final one for this year.