AvtoVAZ Group has posted a 2016 net loss of RUB44.8bn (US$772m), including impairment and restructuring costs, but the automaker increased revenue by 4.8% to RUB184.9bn.
Revenue improvement is attributed to high customer demand for new models such as Lada Vesta and Lada XRAY.
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Lada retail sales in Russia totalled 266,296 cars (1% fewer than 2015), while its Lada domestic passenger car market share increased 2.2 points to 20.1%. The Lada retail sales in export markets amounted to 18,511 cars (based on local registrations in 32 countries) leading to total retail sales of 284,807 cars worldwide.
Production volume of vehicles under the four brands, Lada, Renault, Nissan and Datsun in the Togliatti and Izhevsk plants, amounted to more than 408,000 units, including assembly kits.
Operating loss before impairment and restructuring costs amounted to RUB15.6bn, down 36.8% compared to 2015 (RUB-24.7bn). Impairment and restructuring costs totalled RUB25.0bn. AVG’s net loss amounted to RUB44.8bn in 2016, including impairment and restructuring costs.
AVG’s 31 December, 2016 balance sheet reflects the RUB26.1bn share capital increase in December.
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By GlobalData“The company’s intensive recovery measures are showing first positive financial trends thanks to the active contribution of every employee and partner of Avtovaz,” said Avtovaz Group president, Nicolas Maure.
“Our goal is to reach the break-even of operating results in 2018. The company is fully committed to the recovery of Avtovaz and to the development of the Lada brand, keeping leadership in the Russian market and increasing export volumes.”
For his part, AvtoVAZ chairman, Sergey Skvortsov, added: “In December, 2016 the Board unanimously approved Avtovaz’s Mid-Term Plan and gave full support to the company’s management.
“Beyond that, we acknowledge the Russian market is changing to a positive trend, and the Russian Government extends support programmes to the automotive industry: fleet renewal programme, subsidised loan interest [and] export subsidies.”
Data from just-auto’s QUBE service shows AvtoVAZ is Russia’s biggest automotive company, with the capacity to make almost a million cars a year.
The firm was established in the 1960s as a national car making specialist with highly vertically integrated operations on a massive greenfield site – Togliatti – the car plant town named after a celebrated Italian communist.
