Housebuilder Vistry kicks off £35m share buyback

Vistry shareholders in line for fresh payouts as housebuilder kicks off £35m share buyback after ‘strong start’ to 2022

  • Vistry is returning excess capital to investors after seeing ‘robust trading’ 
  • Last week, the company upped its full-year profit forecasts to around £415m

Vistry has kicked off a £35million share buyback programme after enjoying a ‘strong start’ to the year.

The housebuilder, formerly Bovis Homes, said it was returning excess capital to investors after ‘robust trading’ and debt falling below its £100million target. 

Last week, Vistry posted an upbeat update and said profits would top expectations thanks to strong demand for its homes and higher prices.

Upbeat: Vistry said it was returning excess cash to shareholders after a strong start to the year

Housebuilders started 2021 on a strong foot as home hunters continued to rush to buy its new-built homes before the stamp duty holiday ended in July last year. 

Vistry said last week that 2022 had been even more profitable so far, with the company selling 0.86 homes per week at each of its outlets, compared with 0.75 a year ago.

On the back of the strong performance, it upped its profit forecast for the current year to the top range of its forecasts, or around £415million, from £396million. 

‘The board considers that it is returning a prudent level of cash to shareholders, which reflects the robust trading of the group, while also retaining a strong balance sheet,’ it told investors today.

In 2021, Vistry accelerated its dividend payout to a two times cover, which remains unchanged. 

Analysts at Peel Hunt said the buyback should have a small positive impact on the company’s earnings per share.

‘While £35million is not huge in the context of the group, it demonstrates management’s commitment to returning excess capital, as well as its view on the current share price,’ they added.

FTSE 250-listed Vistry shares rose 2.2 per cent to 902p in morning trading on Friday. 

They have dropped by around a quarter so far this year, which analysts at Peel Hunt say is in line with the sector average.

Other major British housebuilders have come under pressure in recent months after the industry committed over £2billion to remove dangerous cladding from buildings.