Partnership housing specialist Vistry has slimmed down its operational structure from six to three divisions after reporting a £165m hit last year when it unearthed under-estimated build costs at its southern division.

The new operational structure is designed to reduce reporting lines and allow CEO Greg Fitzgerald to get closer to the business.

Each of the new three larger divisions is being led by newly-promoted executive chairs reporting directly to Fitzgerald.

The new executive chairs are being supported at a divisional level by newly appointed divisional commercial directors, operational directors and finance directors under the new consolidated structure.

Vistry continues to operate with the same 26 operating regions.

In a year-end trading statement today, Fitzgerald said the firm had also tightened up procedures around the monthly site cost reviews, and invested in increased commercial assurance.

He said that a significant amount of work had been done to understand and address the issues faced in the former South Division.

“With new operational leadership in place, we are confident we will make rapid progress in stabilising the affected regions within this business area in 2025,” he said.

“We continue to believe the Partnerships market remains very attractive and are committed to our asset light, high returns Partnerships strategy.”

But an accumulation of work in progress due to delayed completions and lower than expected sales rates saw average month-end net debt rise 17% to £535m.

Working capital levels were higher than expected at the year end reflecting a slower open market sales rate than forecast and a resulting build up in stock.

Vistry said it would now target a significant reduction in stock and work in progress levels this year and would adjust build rates in line with changes in market conditions.

Adjusted profit before tax for last year is now expected to be around £250m (FY23: £419.1m). Total completions were up 7% to 17,200 (FY23: 16,118) with revenues expected to beahead 9% to £4.4bn (FY23: £4.0bn)