Bovis Homes group warns of further job cuts after Galliford Try tie-up
20 May 2020, 09:44
Vistry said the jobs move would help drive an extra £9.5 million in savings following the Linden Homes tie-up.
Bovis Homes housebuilding giant Vistry Group has warned of further job cuts following the takeover of rival Galliford Try’s residential arm, but it offered reassurance over a recovery in buyer demand amid the coronavirus crisis.
Vistry – which was rebranded from Bovis Homes following the Galliford deal – said the jobs move would help drive an extra £9.5 million in savings following the Linden Homes tie-up.
This would take its total savings so far since the deal to more than £44 million.
But the firm declined to give details on how many more jobs were at risk.
Vistry said: “We have extended the review of the group following the acquisition, to further leverage the scale of the combined businesses.
“We are consulting with our teams and anticipate that this will result in further headcount reductions.”
The group had already warned in February that it would look to cut around 8% of the combined workforce in the housebuilding business after the Galliford deal and reduce its regional offices from 17 to 13.
But the coronavirus crisis has seen it accelerate the cost savings proposals, while it is also ahead of plan with the integration.
The warning came as Vistry said house prices over the past eight weeks had been “broadly” in line with its forecasts, and it confirmed it has now reopened almost all of its building sites.
It sales teams have been conducting virtual tours of new homes and the group has taken 300 reservations, after cancellations, and legally completed 257 private sales in the past two months.
While its sales offices have now reopened for appointments, the group said it sees “significant opportunity from increasing the use of online channels for all future customer interactions”.
Website traffic has now returned to the levels seen before the crisis, according to the group.
The wider housing sector was also given a boost when the Government said last week estate agents could start reopening for viewings as it begins to ease lockdown restrictions.
Vistry completed its acquisition of Galliford’s Linden Homes and Partnerships and Regeneration units in January in a deal worth £1.1 billion.
It has kept both the Bovis Homes and Linden Homes brands following the acquisition.
Greg Fitzgerald, chief executive of Vistry, said: “In these unprecedented times, the group’s performance during lockdown has been better than initially expected in respect of reservations, completions and cash management.
“The continued strength of Vistry Partnerships throughout the past two months has proven our rationale for the acquisition.”