During the third quarter of 2010/11, Alstoms order intake rose to 5.5 billion, lifted by commercial successes in emerging countries

Over the
third quarter 2010/11 (from 1 October 2010 to 31 December 2010), Alstom
registered its best level of order intake since the first quarter of 2009/10 on
a comparable perimeter. With 5.5 billion, the orders
booked during the period were supported by the strong demand in emerging
markets which represented 60% of the total contracts registered. With orders
above 2.8 billion and 1.6 billion respectively, Power and Transport Sectors
recorded marked increases over the recent quarters, while Grid booked again a
solid 1 billion of orders. With sales at 5.2 billion for the third quarter 2010/11, the
Group achieveda book-to-bill ratio exceeding 1 for the first time over the last two years.

During the first nine
months of 2010/11 (from 1 April 2010 to 31 December 2010), including 2.4
billion in Grid (consolidated from 1 June 2010), Alstom recorded order intake
of 12.5 billion, a 10% increase compared to the same period of last year. The
Groups sales reached 15.7 billion, with 2.7 billion from Grid, up by 9%
compared to the first nine months of 2009/10. Excluding Grid, the Groups order
intake and sales amounted to 10.1 billion and 13 billion respectively, a
decrease of around 10% compared to the first nine months of 2009/10.  

At 46.2 billion on 31 December 2010, the backlog
represented 2 years of sales.

 

"During the third quarter of 2010/11, on the
back of solid demand in the emerging countries, Alstom achieved the best
quarterly level of order intake since July 2009, delivering a book-to-bill
ratio above 1 for the first time over the last two years. This commercial
improvement should gain momentum in the fourth quarter, with order intake
expected to show a new increase. Our strengthened presence in the fast growing
markets, our leading technologies and our recognised service capabilities are
strong assets for the Group in its current competitive environment, said Patrick Kron, Alstoms Chairman & Chief
Executive Officer.

 

Key figures 

 

 

- Orders and sales for Alstom Grid are consolidated from June to
December 2010. Q1 figures, including one month of consolidation (June 2010),
were not released in the Q1 2010/11 results. 

-The reported figures by Sector are presented in Appendix 1. A geographic breakdown of
reported orders and sales is provided in Appendix 2. As for all figures
mentioned in this release, these are unaudited.  

                                                          

 

Sector
Review 

Power  

After the very low point of the first half of 2010/11, Power orders rebounded during the third quarter at 2.8 billion. Main successes were recorded in emerging markets, mainly in Asia, where the demand for new equipment was robust. Thermal Systems & Products booked orders for three gas power plants in Singapore and India, an additional boiler in India, as well as Environmental Control Systems contracts in China and in Vietnam. Thermal Service recorded a very strong quarter at 1.6 billion which included operation and maintenance contracts related to the booked turnkey projects, a retrofit contract for a coal power plant in Poland, a renovation order for the nuclear fleet in France and a good flow of small and medium size service orders. In the Renewable business, projects for hydro power plants in China, Colombia and Turkey were the main orders taken.

Over the third quarter, Power sales were down at 2.7 billion versus 3.2 billion for the same period last year due to the expected decline of sales in Thermal Systems & Products. Power Sector achieved a book-to-bill ratio over 1 in the third quarter 2010/11 for the first time in two years.

For the first nine months of 2010/11, Power order intake amounted to 6.5 billion, a 12% decrease compared to the same period last year when it stood at 7.4 billion. This evolution highlights the weak demand for thermal new equipment in mature markets, where utilities have been postponing some large investments.

Sales for the first nine months of 2010/11 were at 8.6 billion, a 14% decrease in comparison to last year, due to the low volume of order intake over the past period.

 

Transport 

 The orders booked during the third quarter 2010/11 amounted to 1.6 billion, a strong improvement compared to the level of the first half. Very high speed trains in Morocco, metro projects in Montreal (Canada) and Panama City, suburban trains in São Paulo (Brazil) and regional trains in France were the main orders received.

Over the first nine months of 2010/11, Transport orders stood at 3.6 billion, a 8% decrease compared to the same period last year. Sales reached 4.3 billion, including 1.4 billion for the third quarter, up by 1% compared to the first nine months 2009/10.
 

Grid 

During the third quarter of 2010/11, Grid maintained a robust volume of orders booked at 1 billion. The transmission market is showing a rebound in most regions compared to last year. In Europe, the wind sector is active and Grid secured a large order in Germany. In the Middle-East, the Sector recorded contracts for substations in Saudi Arabia and the United Arab Emirates. In the Russian market, which is showing signs of recovery, Grid also booked an order for a substation.

Since the consolidation of Grid in June 2010, the Sector has generated 2.7 billion of sales, including 1.2 billion for the third quarter.
 

Key
events of the third quarter  

During the third quarter, Alstom further strengthened its position on the emerging markets across its portfolio of activities.

In China, Alstom inaugurated on 4 November a new extension of its largest hydropower manufacturing facility at Tianjin, reinforcing its leading position on this fast growing market. This new carbon-neutral factory, the first one in China, will also house a technology centre where Alstom will carry out R&D activities and test turbines developed for its customers. In Transport, Alstom signed on 7 December with the Ministry of Railways a cooperation agreement to address, with its Chinese industrial partners, main lines projects on domestic and defined export markets. This agreement took place a few weeks after Alstom signed a memorandum of understanding with China CNR Corporation Ltd. to develop cooperation for mass transit projects in China.

In Russia, Alstom signed on 9 December several strategic agreements with major Russian electricity production and transmission companies. In hydro, cooperation in manufacturing as well as R&D activities with Rushydro targets the modernisation of the installed base. In nuclear and thermal, new agreements with Rosatom and Inter RAO will further support Alstoms participation in the development of nuclear and fossil fuel power in the country. The agreement signed between Alstom Grid and FSK, the Russian Grid federal operator, will focus on the grid improvement, including the introduction of smart grids technologies. On the Transport side, in December, Alstoms Allegro high speed trains successfully entered into commercial operation on the Saint-Petersburg-Helsinki line, positively positioning the Group on Russias high speed market.

In India, the Group kept on developing its local industrial capabilities. Together with its partner Bharat Forge, Alstom is building a factory in Mundra (Gujarat) for manufacturing steam turbines and generators, and will soon erect near Chennai a factory for mass transit rolling stock to serve the local market.

In Brazil, the wind turbine assembly factory located in the State of Bahia is under completion; along with the Taubate factory for hydro power equipments, it will allow Alstom to further penetrate the Renewable market in Latin America.

 
Financial situation

The Groups financial situation remains sound. In October 2010, Alstom further consolidated its liquidity position with the issuance of two new bonds for 1 billion.
  

Outlook  

Based on its solid backlog, the Group confirms
that the operating margin for fiscal years 2010/11 and 2011/12 should be within
a 7% to 8% bracket.

** 

 

  

This
press release contains forward-looking statements which are based on current
plans and forecasts of Alstoms management. Such forward-looking statements are
by their nature subject to a number of important risk 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. 

 

Appendix 1 Sector Breakdown
by Quarter

 

 

(*)
Figures given for comparison and analysis purposes only.
(**) Organic are excluding any currency & scope impacts.
(***) Grid is consolidated over 7 months.  

Appendix 2 Geographic
Breakdown