Construction Enquirer News Partnerships margin doubles to 9% with hope it will top 12% within five years
House builder Vistry bounced back in the first half to deliver strong growth and profit across the provate house building and partnership arm.
In particular the Partnsership business enjoyed a strong rebound and is on track to double in size by the end of next year with revenue targetted at £1bn.
Partnerships also delivered exceptional margin growth up to 9% from 4% in 2019 helped by higher margin mixed tenure revenues.
The accelerated growth is supported by the division’s 11 operating regions with new operating regions being planned for delivery from 2023.
In the medium terms Greg Fitzgerald, chief executive said: We believe the business and market opportunity could deliver revenue growth of 10 to 15% annually, with the potential for Partnerships to deliver annual revenue of £1.6bn in 5 years, alongside an adjusted operating margin of 12%+.
Looking at the first half group performance he said: “Following an effective operational integration, Vistry is in great shape and delivered a step change in financial performance in the first half.
“The group holds a unique market position with strength and capability across all housing tenures, and we are firmly focused on maximising the opportunities this brings.
“Housebuilding delivered a significant improvement in margin in H1 and we expect this to continue, while Vistry Partnerships is firmly on track to deliver more than £1bn of revenue in FY 22 and a margin in excess of 10%, driven by the accelerated growth of its higher margin mixed tenure revenues.
He added: “The group ended the period with £31.6m net cash representing nearly £400m of cash inflow over the last 12 months, reflecting our financial performance and balance sheet strength.
Overall group adjusted revenue in the first six months of 2021 increased 4% against a 2019 proforma performance to £1.26bn.
Group profit before tax increased to £156.2m (H1 20: £12.2m loss).