Vistry exec axed after accounting blunder that led to a £165m earnings hit and the share worth halving

Embattled housebuilder Vistry has ousted a top executive as it reels from an accounting blunder.

The developer yesterday axed the chief operating officer role to ‘ensure closer proximity of the chief executive to the business’.

But the move is unlikely to reassure investors who are concerned about boss Greg Fitzgerald’s powerful role of executive chairman –effectively holding the job of both chairman and chief executive.

Concerns: Vistry has ousted its chief operating officer Earl Sibley (left). But investors remained concerned over boss Greg Fitzgerald (right) in the powerful role of executive chairman  

And it follows a major accounting blunder that will reduce profits by £165million and has seen the FTSE 100 firm’s share price more than halve in little over a month.

Fitzgerald reportedly offered to resign over the matter, revealed in a trading update in October, but the board rejected his proposal.

However, in a management shake-up, Bovis Homes owner Vistry announced yesterday that chief operating officer Earl Sibley will step down as a director.

After a hand-over, Sibley, who has worked for Vistry for nearly a decade, will leave at the end of the year.

The company said scrapping his role will reduce ‘the length of reporting lines’ and allow Fitzgerald, 60, to have more direct oversight of the business. 

But it comes amid shareholder concerns that Fitzgerald, who oversaw the £1.25billion merger with Countryside in 2022, already has too much control.

Shares in Vistry fell another 5.4 per cent, or 36.5p, to 634p yesterday following the announcement.

Dan Coatsworth, an investment analyst at AJ Bell, said that the accounting blunder, which saw Vistry issue two profit warnings in quick succession, was ‘embarrassing’.

‘It seems to have prompted chief executive Greg Fitzgerald to change the reporting structure so he is closer to engine room,’ he said.

‘Fitzgerald watching every move suggests no more mistakes will be tolerated and it’ll now be his job on the line if things don’t improve. 

Getting rid of the chief operating officer role isn’t out of the ordinary if there are other senior members of staff embedded into operational strategy, but one has to wonder if this is only a temporary measure to steady the ship.

‘It’s not as if Fitzgerald doesn’t already have enough on his plate with a joint chief executive and chair position.’

Crisis: An accounting blunder will reduce Vistry profits by £165m and has seen the FTSE 100 firm’s share price more than halve in little over a month

Oli Creasey, property analyst at Quilter Cheviot, said: ‘While the chief executive is known to be a shrewd operator, it’s worth noting that he isn’t universally popular, with around 20 per cent of shareholders recently voting against his reappointment.’

He added: ‘It will be interesting to see if this change enables him to better manage the local divisions and improve overall performance.’

The shake-up comes after Vistry said in October that it had underestimated development costs at nine sites in its southern division by around 10 per cent, and that it would dent profits by £115million over three years.

And it issued a second £50million profit warning this month, taking the total to £165million.

An independent review found that ‘pressure being felt from organisational change’ was a key factor in Vistry’s southern division, The Sunday Times newspaper reported.