29 Jul 2022 12:29

Renault writes off 2.2 bln euros on end of operations in Russia

MOSCOW. July 29 (Interfax) - French automaker Renault estimated its non-cash charges from the end of operations in Russia at 2.217 billion euros and has deconsolidated Russian operations from its financial statements for the first half of 2022.

The group's adjusted expenses in connection with the departure from Russia in the first half include impairment of goodwill and intangible assets in the amount of 1.185 billion euros, and impairment of the property, plant and equipment of Renault Russia and Avtovaz in the amount of 1.032 billion euros, Renault's financial statements showed.

The company's net cash position after the exit from Russia was reduced by 522 million euros to 1.1 billion euros.

In mid-May, Renault handed its Moscow plant, Renault Russia, to the city government and its 67.7% stake in Lada Auto Holding LLC, the joint venture that controls leading Russian carmaker Avtovaz , to Russian institute NAMI for a symbolic 1 ruble with the option to buy back its stake within six years.

If it returns to Russia, Renault will have to make a contribution to Avtovaz in proportion to the investments, subsidies and profit that the Russian carmaker received in its absence. The amount of such a contribution will determine the equity stake Renault gets in the Russian company, which could drop to 51%. Renault said it would be able to regain control of 51% of Avtovaz for a contribution of 400 million euros.

It was reported earlier that Renault's global sales dropped 29.7% to 1.199 million vehicles in the first half of 2022 due to the ongoing semiconductor shortage and exit from the Russian market, which was the company's second largest by number of vehicles sold. Without Russia, the company's sales fell 12% in the first half.