Homebuilder Vistry slips to first-half loss, points to recovery in second half

(Reuters) - Homebuilder Vistry VTYV.L swung to loss for the first six months of the year on Tuesday due to an earlier shutdown of its construction sites amid the coronavirus crisis, but said it had seen a "strong start" to the second half as restrictions eased.

The company, formerly called Bovis Homes, reported a pretax loss of 12.2 million pounds ($15.99 million) in the six months ended June 30 due to increased costs, compared with a profit of 72.5 million pounds a year earlier. Home completions plunged to 1,235 from 3,371.

“The business incurred additional costs directly related to the period of lockdown, lower levels of operating efficiency from social distancing and the lengthening of development period expectations,” the company said.

Shares dropped 3% to 617.5 pence by 0822 GMT, taking the year-to-date losses to a staggering 53%.

However, Britain’s housing market has picked up pace as restrictions gradually eased, with tax breaks for home purchases and a trend towards suburban living spurring home sales.

“We have seen positive sales trends since early May, with consumer interest higher than at any time in recent years. Our sales rate in the second half to date is running 20% ahead of last year,” Chief Executive Officer Greg Fitzgerald said.

The company aims to resume dividend payments in 2021, while larger rival Persimmon reinstated payouts last month.

Vistry expects full-year pretax profit to be between 130 million pounds and 140 million pounds and targets earnings of at least 310 million pounds in 2021.

Sales jumped to 606.4 million pounds in the half-year period from 472.3 million pounds.

Reporting by Jasmine I S and Samantha Machado and in Bengaluru; Editing by Devika Syamnath and Amy Caren Daniel