Russia pull-out steers Renault into red

French carmaker Renault said Friday that its decision to quit the Russian market pushed it deep into the red in the first half of 2022, but it was confident that new models would help steer it around.

Renault said in a statement that it booked net losses of 1.6 billion euros ($1.6 billion) from January to June, compared with profit of 368 million euros for the same period a year earlier.

By contrast, underlying or operating profit, jumped by 160 percent to 939 million euros.

First-half revenues were more or less stable, inching forward by 0.3 percent to 21.1 billion euros, the carmaker said.

Renault is “resolutely pursuing its in-depth transformation and turnaround of its activities,” said chief executive, Luca de Meo.

“These first-half results are a proof of this: despite all the headwinds related to the stop of the activity in Russia, the semiconductor crisis and cost inflation, the group continues to improve its operating performance and is beginning to benefit from the success of new launches.”

In May, Renault sold its 100-percent stake in Renault Russia and its 68-percent stake in AVTOVAZ.

As a result of discontinuing those operations, Renault took a hit of 2.3 billion euros on its first-half accounts, mainly due to write-downs on real estate, plant and equipment, intangible assets and goodwill, the statement said.

But with that now in the rear-view mirror, Renault said it was upgrading its full-year forecast, and was now pencilling in an operating margin of 5.0 percent for 2022, instead of 3.0 percent previously forecast.

bur-spm/jm