FAW Car expects annual profit growth of 105 mln yuan after two assets transfer

Shanghai (Gasgoo)- FAW Car, a subsidiary of FAW Group, transferred its assets in economic development zone of Changchun to a stamping dies company dubbed Zhisheng in the capital of Jilin for 81.2 million yuan ($11.5 million), according to a filing from the company. Besides, the automaker assigned the real estate originally intended for college students’ apartments to FAW Asset Management Co., Ltd (FAW Asset) for roughly 75.05 million yuan ($10.7 million).     

The document suggested the trading of the company’s property in the development zone will contribute to a profit increase of 57 million yuan ($8.1 million). 48 million yuan ($6.8 million) will be added to the annual earnings through the transfer of the realty. 

The FAW’s subsidiary indicated that activating the company's inefficient assets helps solve problems left over from history and optimize the asset structure. It will facilitate the company's independent cause with more working capital and higher fund use efficiency.

FAW Car saw its revenue for the first three quarters of 2019 slide 6.95% year on year to roughly 17.3 billion yuan ($2.5 billion). The net loss attributable to parent company's shareholders was 267 million yuan ($38 million), showing a profit plunge of 297.33% from the year-ago period.

The Changchun-based automaker owns two passenger vehicle brands, FAW Besturn and FAW Mazda. The Besturn sales in the first eleven months surged 43% over the previous-year period to more than 100,000 units. The other brand sold 80,998 units in total from Jan. to Nov., which were down by 19.4% year on year. The assets transfer is likely to help turn the company's 2019 business around (photo source: FAW Car).