AOMD Alstom

Alstom Note – Q2 and H1 2024/25 Preview

4 October 2024 – Alstom presents below a preview to its Q2 and H1 2024/25 results.

Q2 2024/25 orders

The table below summarizes the large orders (more than €200m) published and booked during the quarter.

• Deals announced previously, but to be booked at a later stage

• Haifa-Nazareth Systems contract for ~€700m, expected booking in FY 2025/26: link to the press release
• CP (Portugal) for ~€700m, awarded to Alstom. Expecting end of competitors’ challenge. Expected booking in FY 2024/25.
• Toronto electrification for several € billions. Preliminary design works on-going (joint development phase). Bookings are expected in several batches from calendar year 2025 to 2028.

• Focus on base orders
  
  

In addition to large orders disclosed in the above table, we remind the guidance for base orders (less than €200 million) which typically account for €1.5b to €2.0b per quarter since the merger with Bombardier.

The table below reminds the breakdown between large and base orders during Q2 for the last three fiscal years, keeping in mind a positive seasonality of small orders on H2 (H2>H1):

• Reminder - Guidance on orders
  
  

At FY 2023/24 release on 8 May 2024, we guided for :

• Book-to-bill ratio above 1 for FY 2024/25 at Group level.
• Book-to-bill ratio for Rolling Stock to be around 1 for the three years FY 204/25 to FY 2026/27.

***

H1 2024/25 Sales

At FY 2023/24 release on 8 May 2024:

• We guided for an organic growth around 5% for FY 2024/25 at Group level
• We reminded of usual seasonality (H1 2024/25 growth to be measured against first half of last fiscal year)

Breakdown of sales by currency is given in the appendix of the FY 2024/25 analysts presentation (page 42): link to the presentation

We expect negative forex impact on sales of ~(0.9)% for the first half of FY 2024/25, primarily due to USD and USD-pegged currencies against EUR.

We expect negative perimeter impact on H1 2024/25 sales of ~(0.7)%

• for ~(0.4)% due to a change in control of two service JVs with RENFE in Spain, following changes in the JV agreements: these JVs will now be accounted for under the equity method and no more as joint operations.
• for ~(0.3)% due to the disposal of US conventional signalling to Knorr-Bremse, closed on 31 August 2024

***

H1 2024/25 adjusted EBIT
        
At FY 2023/24 release on 8 May 2024:

• We guided for an adjusted EBIT margin around 6.5% for the full year FY 2024/25, an improvement of around 80bps versus FY 2023/24 driven by volume and mix, cost savings initiatives and industrial efficiency
• We reminded of usual seasonality, driving aEBIT margin to be more H2 weighted

During the Q1 analysts call on July 23, 2024:

• We gave indication that H1 aEBIT margin would be consistent with FY 2023/24 aEBIT margin (reminder: 5.7%)
• We reiterated full year guidance

***

Below aEBIT – reminder of FY 2024/25 guidance

• Non-operating income and expenses:
  
  

At FY 2023/24 release on 8 May 2024, we indicated that they should not exceed (€200m) for the FY 2024/25, including:

• The final year of integration costs, for an amount expected around €90m for the full year.
• Some restructuring, legal fees and other non-operating costs

• Financial result:
  
  

We indicated around €200m of P&L net expense for FY 2024/25, with reduction of net interests paid by around €70m but some increase in bank fees and hedging.

• PPA :
  
  

The depreciation table on page 46 of the FY 2023/24 presentation: link to the presentation

***

Free Cash Flow

At Q1 FY2024/25 trading update, we confirmed

• our FCF guidance for the full year FY 2024/25 within the range €300m - €500m
• with seasonality driving negative FCF within a range €(300m) - €(500m) for H1 2024/25

Reminder of main assumptions for guidance:

• Supportive market demand and FY 2024/25 downpayments consistent with FY 2023/24 (reminder: at the time of Q1 analysts call on 23 July 2024, we confirmed that these conditions were met)
• End of integration in FY 2024/25
• Balance sheet plan fully executed in FY 2024/25 (update: this has been fully achieved following the closing of the sale of US conventional signalling on 31/08/2024 – see link to press release here)
  
  

This document contains forward-looking statements which are based on current plans and forecasts of Alstom’s management. Such forward-looking statements are relevant to the current scope of activity and are by their nature subject to a number of important risks and uncertainty factors (such as those described in the documents filed by Alstom with the French AMF) that could cause actual results to differ from the plans, objectives and expectations expressed in such forward-looking statements. These such forward-looking statements speak only as of the date on which they are made, and Alstom undertakes no obligation to update or revise any of them, whether as a result of new information, future events or otherwise.

This document does not constitute or form part of a prospectus or any offer or invitation for the sale or issue of, or any offer or inducement to purchase or subscribe for, or any solicitation of any offer to purchase or subscribe for any shares or other securities in the Company in France, the United Kingdom, the United States or any other jurisdiction. Any offer of the Company’s securities may only be made in France pursuant to a prospectus having received the visa from the AMF or, outside France, pursuant to an offering document prepared for such purpose. The information does not constitute any form of commitment on the part of the Company or any other person. Neither the information nor any other written or oral information made available to any recipient or its advisers will form the basis of any contract or commitment whatsoever. In particular, in furnishing the information, the Company, its affiliates, shareholders, and their respective directors, officers, advisers, employees or representatives undertake no obligation to provide the recipient with access to any additional information.

Attachment

• H1 2024-25 - Alstom Preview Note - Final

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