A beverage company missed budgeted EBITDA by Rs 22 crore. Build the bridge from budget to actual and write the three sentences for the board.

EBITDA was Rs 22 crore, or 14.7%, below budget, and the bridge shows two stories. The price rise added Rs 30 crore but volume fell enough to give back Rs 28 crore, and a drift to small packs cost Rs 8 crore, so commercial levers net to minus Rs 6 crore. PET and sugar inflation and an overhead overrun take the other Rs 16 crore.

Rs 22 crore short tells a board nothing it can act on. A household that overspent by Rs 20,000 in a month needs to know whether it was school fees, a family wedding or groceries before it can decide anything. A bridge turns one variance into a list of causes, each owned by someone, in order of size. The board can then ask the sales head about volume and the procurement head about resin, rather than asking finance why the number is wrong. The format is the EBITDA bridgeA chart that starts at one EBITDA figure, adds and subtracts each cause of change as a floating bar, and ends at the other figure., read left to right.

Group the bars by who controls them, then order within each group. Put the commercial levers first, price, volume and mix, because they are linked: the price rise is the most likely reason volume fell. Showing them next to each other lets the board see that the price rise was nearly cancelled by volume, which a bridge sorted purely by size would split apart. Cost lines come next, input costs before overheads, because one is largely external and the other is fully controllable.

Each sentence carries one idea, with the number in it. One: EBITDA was Rs 128 crore against a Rs 150 crore budget, Rs 22 crore or 14.7% short. Two: the price rise added Rs 30 crore but lower volume and a drift to small packs took back Rs 36 crore, so commercial levers cost a net Rs 6 crore. Three: PET and sugar inflation of Rs 12 crore and a Rs 4 crore overhead overrun account for the remaining Rs 16 crore. A fourth line, if the board allows it, says what management is doing about each.

Say the limit too. A driver split depends on the order in which effects are calculated: price measured on budgeted volume gives a slightly different split from price measured on actual volume, and the difference lands in volume. State the convention in a footnote. The bridge also cannot tell you whether the price rise was a good decision; that needs the volume the company would have lost anyway, which only a test market or an elasticity estimate can supply.