Brigade Enterprises reported poor numbers in the third quarter of financial year 2012-13 on January 29. It reported EBIT loss in hospitality business while real estate segment's EBIT fell quite sharply. In an interview to CNBC-TV18 Suresh Kris, CFO, Brigade Enterprise said that they have managed to maintain EBITDA at 30 per cent in Q3.
Kris informed that so far, big projects like Meadows and Exotica have not been recognised even though the sales have been very good. "By Q4, we will be able to recognise revenue of those two big projects", he added.
Below is the edited transcript of his interview to CNBC-TV18
Q: A little disappointing that the hospitality business reported an earnings before interest and taxes (EBIT) loss. Can you just take us through what happened in that segment?
A: Due to depreciation we must be having those numbers. It is not the EBIT loss. As far as the company, as a whole we are keeping our old 30 per cent earnings before interest, tax, depreciation, and amortisation (EBITDA) throughout the quarters.
Q: You had talked about a difficult Q3 and a better Q4. Could you just outline what you expect to see in Q4 both in terms of volume growth and what the bottom-line flow through will be in terms of your margins and your profitability?
A: We are expecting revenues from some big projects in Q4. So far, big projects like Meadows and Exotica have not been recognised even though the sales have been very good. It was because of threshold limit of 25 per cent of the estimated construction cost. We are unable to recognise the revenues so far. By Q4, we will be able to recognise revenue of those two big projects.
Q: What kind of pricing have you been able to achieve for some of these residential projects?
A: When you talk about the pricing per se for Meadows it could be around Rs 3,200, whereas for Exotica it could be around Rs 4,500 per square feet.