AVTOVAZ Group (AVG) announces Q1 2017 IFRS results. The positive trend regarding market share, revenues and financial results, which started in 2H 2016, continued.
In Q1 2017 AVG sold 61,447 LADA cars, 8% more than in the same period of 2016. LADA’s market share (passenger cars + light-commercial vehicles) increased by 1.3 points to 19.1%. This achievement was mostly driven by growing sales of LADA’s new generation models – Vesta and XRAY. Three LADA models achieved positions in the list of TOP10 bestsellers: LADA Granta (2nd), LADA Vesta (3rd), LADA XRAY (9th). AVG also sold 24,004 units of the Renault, Nissan and Datsun brands to its Alliance partners.
These positive commercial trends resulted in a revenue growth to 46.0 B-RUR, which is 20% better than in Q1 2016. The operating loss amounted to 1.0 B-RUR, and improved by 84% compared to Q1 2016. Part of the improvement of the financial results was driven by one-time effects, like the change of provisions.
AVG sees upcoming risks from raw material price fluctuations as well as potential market uncertainties due to the end of the Fleet Renewal program in H2 being substituted by new support measures from the Russian State. Export sales may also be affected by forex conditions. Nonetheless, the further development of the LADA model range (Vesta SW and SW Cross to be launched in H2 2017) as well as the further optimization of costs make AVG confident in further reducing losses in 2017, still confirming the objective to reach positive operating results in 2018.
