13 Jul 2010 14:31

AvtoVaz starts posting profits in Q2

MOSCOW. July 13 (Interfax) - OJSC Avtovaz posted 1 billion rubles in profit from its operations in April-June 2010, the company's President Igor Komarov said during a meeting with Russian Prime Minister Vladimir Putin.

"You now have posted profit for the first time, 1 billion rubles, which is quite an amount for such a major enterprise. I understand that we have reached agreements with both you and forewing investors. And with them you have developed a comprehensive plan for joint efforts in the technical reequipping of the enterprise, development and producing new models. This is to make AvtoVaz an efficient modern enterprise, effective from an economic point of view, self-sufficient and having possibilities for development. How are these plans being realized," Putin asked Komarov said.

"We have produced positive results and increased sales primarily thanks to the utilization program. Total sales doubled in the second quarter in comparison with the first quarter. These efforts have helped produce profit and positive results for our operations," Komarov said.

AvtoVaz told Interfax that the company had posted 1 billion rubles in profit for the second quarter of 2010.

AvtoVaz's losses in 2009 according to Russian accounting standards (RAS) increased to 38.5 billion rubles from 6.7 billion rubles in 2008. The company's sales revenue declined by 47% to 84.2 billion rubles in 2009.

The company posted 2.58 billion rubles in RAS net losses for the first quarter of 2010, decreasing seven times from 18.75 billion rubles in losses for the fourth quarter and 6.33 billion rubles in losses for the first quarter of 2009.

AvtoVaz reduced its car sales by 44% to 349,500 units in 2009. The company plans to boost annual car sales to 1.2 million units, of which 70% will be Lada brand automobiles.

Russian Technologies, Troika Dialog and Renault currently each own 25% plus one share in AvtoVaz.