AVTOVAZ has made a quarterly profit for the first time since 2016

AVTOVAZ has made a quarterly profit for the first time since 2016

VedomostiAVTOVAZ has made a net profit of 609 million rubles according to IFRS within the first quarter of 2017, in contrast with last year’s 2,8 billion rubles loss (company accounts published on 26 April). The revenue has risen by 40,8% to 64,8 billion rubles.

This is the first profit, since the company started publishing its quarterly accounts in 2016. 2012 was the last profitable year for AVTOVAZ, when company made 29,2 billion rubles.

The recapitalisation programme in the amount of more than 107 billion rubles, carried out by the major shareholders Renault and the state company Rostec (which control 83,5%), was the main factor in the improvement of AVTOVAZ, as stated by the company. Part of the money will be used in the repayment of debts. The net debt of AVTOVAZ has gone down by 15% to 72 billion rubles by the end of the first three months of 2018, as calculated by the VTB Kapital. The full effect of the conversion of the company’s over 61 billion rubles debts to Rostec and Renault, completed in April, will be felt in the second quarter.

In addition, the sales of the company have risen in its main market: Russia. The sales have increased by 29% to 79.114 vehicles within the first quarter, pushing up the market share of the brand by 1 point to 20,1%. The company has noted the rising popularity of the new generation Lada models – Vesta Sedan, SW, SW Cross, as well as the effective measures taken by the government. The state support helps the company increase exports: up by 25,1% during the first quarter to 7861 vehicles.