(Sharecast News) – UK house builder Vistry said it would resume dividend payments as it guided for full-year profits at the upper end of forecasts.
The company on Tuesday said pre-tax profit for the year to December 30 was expected at the top end of the expectations at around £140m and added that it was still confident of lifting 2021 full-year pre-tax profit in 2021 to £310m, assuming stable market conditions.
Vistry said it intended to pay a ‘modest’ final dividend for 2020 on the back of a strong second-half performance, net cash position and record forward sales.
“We have seen strong demand for our homes during 2020 with the group’s private sales rate per outlet per week increasing by 15% in the second half to 0.62m,” the company said in a trading update.
“Encouragingly, customers continued to reserve homes during the second national lockdown in November, and throughout December, with our underlying sales rate up around 20% in the last six weeks of the year compared to the prior year equivalent period.”
Vistry added that 2020 completions were at the top end of expectations, reflecting a strong second half performance, while pricing remained firm through the year and underlying prices rising moderately.
The UK housing market has been fuelled by pent-up demand since the initial easing of Covid-19 lockdown measures in the summer, combined with a temporary stamp duty holiday on the purchase of homes of up to £500,000. People are also looking for larger premises due to the shift to homeworking.
The most recent Halifax house price index showed prices surged 6% over 2020 to end the year at a record high of £253,374.
However, Vistry warned of it was “alert to the wider market uncertainty, including the potential implications of the most recent lockdown, as well as for housebuilding specifically the changes from an end to the stamp duty holiday and existing Help to Buy scheme at the end of the first quarter”.
“We are encouraged by the strength of the market in 2020 and the levels of demand during the second national lockdown in November, and whilst very early, we have seen no impact from this third national lockdown.”
The company was formed in January last year, after Bovis Homes merged with Linden Homes, which it had bought from Galliford Try alongside its Partnerships and Regeneration units for £1.1 billion.
