Brazilian builder PDG posts $1 mln profit vs loss a year ago

SAO PAULO Thu May 8, 2014 7:39pm EDT

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SAO PAULO May 8 (Reuters) - PDG Realty SA, one of Brazil's biggest homebuilders, posted a quarterly profit of 2.8 million reais ($1.3 million) on Thursday, as cutbacks in the scale of operations helped the company swing from a net loss of 73.8 million reais a year earlier.

The result marked PDG's second profit in a row after four straight quarters of losses. Three analysts polled by Reuters forecast a loss of 25.7 million reais, on average, while two expected an average profit of 7.5 million reais.

PDG has struggled to rebound from an aggressive expansion that led to huge cost overruns and project delays. The developer has scaled back operations and refocused on major markets.

The company launched 130 million reais worth of new projects in the quarter, down from 388 million reais a year earlier.

Contracted sales fell to 418 million reais in the first quarter, from 881 million reais in the first quarter of 2013.

"We are still reducing the number of open work sites," PDG said in its earnings statement. "Operational cash burn has been falling from quarter to quarter and we expect to reach positive cash flow over the course of the second semester."

Earnings before interest, taxes, depreciation and amortization, a gauge of operating profit, rose to 195 million reais in the quarter from 138 million reais in the same period a year earlier. ($1 = 2.21 Brazilian reais) (Reporting by Asher Levine and Juliana Schincariol; Editing by Louise Ireland and David Gregorio)

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