ABB ALSTOM POWER post-closing adjustments

ABB ALSTOM POWER has recorded a negative exceptional item in
its first operating quarter. This is the result of a number of
post-closing adjustments of an exceptional, non-recurring
nature and does not cause ALSTOM to doubt the future
profitability improvement expected from the Joint Company.

At the request of its two shareholders, the management of
ABB ALSTOM POWER has undertaken a complete project-by-project
review of all on-going projects currently in its order book.
Based on rigorous risk assessment, this review has led to a
decision to increase the level of provisions for risks on a
number of large projects leading to an exceptional pre-tax item
of 637 million for ABB ALSTOM POWER for the three-month
period ending 30 September 1999. Accordingly, in the second
half 1999, the Joint Company, proportionally consolidated, will
not contribute positively to ALSTOM's operating income.

In ALSTOM's accounts, those post-closing adjustments which
cannot be accounted for in the opening balance sheet, will be
off-set by the capital gain registered at the time of the sale
of the Company's heavy duty gas turbine business to GE. The
capital gain will also cover ALSTOM's 50% share in the initial
restructuring costs of ABB ALSTOM POWER.

Going forward, ALSTOM confirms its confidence in the future
success of ABB ALSTOM POWER which will begin its first full
year of operations, 2000, from a solid base. The synergy
benefits estimated at 500-600 million in the fourth year
are re-confirmed and improvements, at an operating level, are
forecast progressively over the next 4 years as the synergies
are realised. For next year, the pre-tax margin target is 3-4%
and a longer-term target is confirmed at 7-8%.

ALSTOM confirms the announcement of its First Half Results
1999/2000 on 23 November 1999, as previously communicated.