Annual Results 1999/2000 01 April 1999 - 31 March 2000 A
Year of Progress and Transformation

Repositioning of Energy Sector ? capital gain and exceptional
restructuring charges

Strong Order Backlog of 23.7 billion to fuel future sales
growth

Operating Income up 3%; up 23% excluding Energy

Earnings per share before amortisation of goodwill up 40%

Commenting on the results presented to the Board on 22 May
2000, Pierre Bilger, Chairman and Chief Executive Officer of
ALSTOM stated:

'1999/2000 has been a transforming year for ALSTOM during
which great progress has been made to realise our vision to
position the Company as the global specialist in energy and
transport infrastructures.

In recent weeks, we have completed both the refocusing of
Industry and the strategic repositioning of Energy with ALSTOM?s
acquisition of the outstanding 50% shares in former joint
company, ABB ALSTOM POWER, now renamed ALSTOM Power.

The Company has recorded a sound performance marked by a
further strengthening of the order book and double-digit growth
in sales, partly the effect of the inclusion of 50% of the
enlarged power activity. Operating Income increased 3% despite
the under-performance of Energy during its transition phase.
Excluding Energy, operating income increased by a significant
23%.

This increase in operating income coupled with the impact of
the Energy repositioning - capital gain realised on the sale of
the heavy duty gas turbine business and the additional
restructuring charges incurred during the year - has led to a 40%
increase in earnings per share before amortisation of
goodwill.

As a result of the complete integration of ALSTOM Power which
will be fully accounted for in 2000/01, ALSTOM will benefit one
hundred per cent from the turnaround and synergy potential of
this activity. In the new configuration, we expect to achieve the
overall 6% operating margin target in 2002/03 and clearly believe
our longer-term financial prospects to have been
strengthened.'

Simplified Income Statement

Other Key Indicators

For basis of presentation, see Explanatory Notes on page
14

 

Global Review

Energy Repositioning

During the last 12 months, ALSTOM has completely repositioned
its Energy Sector in three steps.

First, the heavy duty gas turbine business based on GE
technology was sold to GE for a net consideration of
approximately 820 million. This was the main contributing
factor to the net capital gain of 576 million included in
the Income Statement.

Secondly, the remaining Energy Sector businesses were
regrouped with the power generation activities of ABB to form a
joint company, ABB ALSTOM POWER. To achieve the 50-50 status and
taking into consideration the value of the ABB-contributed heavy
duty gas turbine technology, ALSTOM paid a lump sum of
approximately 1.48 billion. During the post-closing
transition period and following an in-depth project review, an
exceptional pre-tax charge of 637 million, mostly relating
to circumstances existing at the time of the contributions made
by the two shareholders, was recorded in the joint company?s
accounts.

Finally, on 11 May 2000, ALSTOM paid 1.25 billion to
complete its acquisition of ABB?s 50% share in the power company
and ABB ALSTOM POWER became ALSTOM Power. The transaction price
includes the resolution of all outstanding matters relating to
the formation of the joint company.

 

Industry Refocusing

Since the launch of its programme to dispose of non-performing
or non-core industrial businesses announced one year ago,
agreements have been concluded for the disposal of businesses
with aggregate sales of approximately 800 million.

As at 31 March 2000, transactions had been completed for the
disposal of businesses with aggregate sales of approximately
400 million including activities in the fields of
industrial and nuclear valves, gears, automotive and painting
systems and automated assembly lines.

Subsequent to the end of the 1999/2000 financial year,
agreements have been concluded for the sale of the diesel engines
and automated handling systems businesses, representing a further
400 million.

As a result of this refocusing, from 1 April 2000, a new
Sector, Power Conversion, replaces Industry within the Company?s
reporting structure. With sales of approximately 600
million, this Sector was created on 1 July 1999 primarily from
the merger of ALSTOM?s existing Drives and Controls and Motors
and Generators businesses. It provides a Company-wide platform
for the development of power electronics.

Orders and Sales

Breakdown by Sector

* orders received or sales made by ALSTOM Network for both
periods and in 1999/2000 also orders received or sales made by
the overseas entities in Australia, South Africa and India, not
allocated to Sectors.

During the year ended 31 March 2000, ALSTOM received orders
amounting to 17 259 million, an increase of 9% compared to
the same period last year. This is mainly due to the mechanical
effect of the 50% consolidation of ABB ALSTOM POWER. Continued
strong growth in Transport was also a contributing factor.

Consolidated Net Sales in 1999/2000 amounted to 16 229,
an increase of 15% compared to the same period last year. T&D
has benefited from the mechanical effect of the integration of
Overseas businesses as has Contracting to a lesser extent. These
businesses were formerly consolidated within Industry whose sales
have decreased as a consequence of this de-consolidation and the
disposal of a number of non-core businesses. Excluding this
change of scope, T&D order intake decreased by 9% in
1999/2000 as a result of the low level of investment in
transmission equipment and systems in Asia and in certain
European markets affected by the on-set of deregulation. Organic
growth in sales was generated essentially by Transport and Marine
as a result of the high level of order intake in these two
Sectors during the past two years.

Breakdown by Geographic Region

The geographic breakdown of orders and sales has been
influenced by the inclusion of the more widely diversified
geographic spread of ABB ALSTOM POWER?s activities.

Activity in Europe (50% of total orders) remained relatively
stable with major orders for two combined cycle power plants in
Spain and 50% consolidation of ABB ALSTOM POWER?s strong Eastern
European base compensating a slowdown in Transport orders in
France and a lower level of T&D orders in Germany impacted by
the on-set of deregulation.

The 32% increase in orders in the Americas (28% of total
orders) was fuelled by growth in North America and particularly
in the United States where ABB ALSTOM POWER benefited from the
continuing boom in the gas turbine market, obtaining orders for
over 3 400 MW of gas-fired plants in Texas, Massachussets and
Connecticut. Transport also made marked progress in the region
(orders up almost 80% in North America and over 160% in South
America) through major orders received for the Caracas
(Venezuela) and Buenos Aires (Argentina) metros as well as an
order for 100 commuter coaches for the New Jersey Transit
Authority (United States).

Asia-Pacific (16% of orders) increased slightly with major
orders in Energy (2 x 900 MW advanced supercritical boilers at
Wai Gao Xiao) and Transport (28 trainsets and complete signaling
system for Shanghai Line 3) more than compensating for the low
level of investment in transmission equipment.

Operating Income and Margin

ALSTOM?s cost of net sales in 1999/2000 amounted to
12 977 million as compared to 10 867 million in the
previous year. This increase is mainly attributable to the change
in the Company?s business mix with the decrease of the supply of
loose components more than off-set by the increase in service
activities which include a higher percentage of direct costs.

In absolute terms, selling and administrative expenses
remained stable whilst as a percentage of net sales, they
decreased (14.1% in 1998/99 compared to 12.4% in 1999/00). This
is partly a result of ALSTOM?s continuous efforts to rationale
and optimise its commercial and management organisation. In
particular, the STRETCH 30 programme now widely implemented
throughout the Company has generated significant savings in all
categories of expenses.

Operating Income during the year amounted to 729
million, an overall increase of 3%. Excluding Energy, impacted by
the lower than expected level of operating income of ABB ALSTOM
POWER during its post-closing transition period from July to
December 1999, operating income amounted to 612 million,
an increase of 23%. This takes the operating margin excluding
Energy to 5.2% compared to 4.5% in 1998/99. This growth comes
primarily from significant improvements in Contracting and Marine
which have more than compensated the slight decrease in T&D
affected during the year by difficult market conditions.

Net Income

At 593 million, Net Income before amortisation of
goodwill increased by 40%, leading to an earnings per share of
2.8 compared to 2.0 in 1998/99.

Financial expense of 62 million was incurred during the
year compared to a financial income of 24 million during
1998/99. This reflects the impact of the 1.48 billion cash
payment made to ABB at the time of the creation of ABB ALSTOM
POWER and the Company?s resulting net financial debt
position.

Other revenues of 72 million include 576 million
net gain on disposals, mainly relating to the sale of the heavy
duty gas turbine business to GE as well as 95 million
expense related to pensions and employee profit-sharing and
442 million of restructuring costs. This significant
increase in restructuring costs compared to 116 million in
1998/99 is mostly due to the integration of ALSTOM?s share of ABB
ALSTOM POWER?s integration plan and to a lesser extent to the
acceleration of restructuring plans in T&D.

The lower than usual tax rate of 16% reflects the untaxed
capital gains and provisions available as a result of the
strategic repositioning in Energy. The effective tax rate for
1999/2000 after adjusting for the impact of non recurring items,
notably in ABB ALSTOM POWER is 32% compared to 38% in
1998/99.

Goodwill amortisation amounted to 244 million compared
to 121 million in 1998/99. This strong increase is mainly
attributable to the creation of ABB ALSTOM POWER and to an
exceptional write-off of goodwill in Spain for an amount of
43 million.

Net income increased in 1999/2000 by 15% to 349 million,
as compared to 303 million in 1998/99.

 

Balance Sheet

At 31 March 2000, shareholders? equity amounted to 1
986 million, 2 019 million including minority
interests.

At 4 929 million provisions increased by 1 091
million in 1999/00 primarily due to the mechanical effect of the
inclusion of ABB ALSTOM POWER.

The increase in goodwill from 2 067 million end March
1999 to 3 810 million is mainly a result of the creation
of ABB ALSTOM POWER. This transaction led to additional goodwill
of 1 726 million and consolidation of a further 482
million corresponding to 50% of the goodwill transferred from the
contributed businesses, partially offset by the transfer of
213 million of goodwill related to Cegelec.

Working capital requirements amounted to 752 million in
1999/2000 as compared to 1 142 million in the previous
year. This positive evolution is a consequence of the inclusion
of ABB ALSTOM POWER and an optimisation of the management of the
Company?s assets.

Taking into account long-term deposits of 308 million,
the Company had net financial debt at end March 2000 of
831 million leading to a ratio of net debt/market
capitalisation of 14% and a gearing of 41%.

Cash Flow

Financial debt increased during 1999/2000 by 908
million primarily due to the cash payment of 1.48 billion
made to ABB at the time of the creation of ABB ALSTOM POWER. The
strong improvement in cash from operations results from the
positive evolution of working capital requirements.

Dividend

In line with ALSTOM?s policy to pay out on average one third
of its annual consolidated net income in dividends, the Board of
Directors proposes a dividend for 1999/00 of 0.55 per
share ( 0.825 per share including tax credit) compared to
0.5 per share in 1998/99. This dividend is subject to
approval of shareholders during the Annual General Meeting on 5
September and should be paid from 11 September 2000.

 

Human Resources

As at 31 March 2000, ALSTOM employed 120 678 people world-wide
as compared to 113 707 people one year earlier. This increase
results primarily from the inclusion of 50% of ABB ALSTOM POWER?s
total employees.

During 1999/00, excluding movements of employees in ABB ALSTOM
POWER, almost 8 900 employees left the Company partly as a result
of on-going restructuring programmes and over 1 000 employees
left as a result of the Industry disposals programme. During the
same period approximately 8 500 new employees were recruited in
order to reinforce the Company?s higher growth, higher margin
potential activities, notably in the field of services.

At the time of its creation, ABB ALSTOM POWER employed 58 000
people. At 31 March 2000 this figure had decreased to 52 200.
This is the result of the completion of restructuring plans
already initiated within the contributed businesses as well as
the launch of new post-merger restructuring plans. The management
of ABB ALSTOM POWER announced a programme to reduce the total
workforce by 10 000, or approximately 20%, world-wide. This
programme involves the closure or significant down-sizing of 25
sites, mainly in steam-related activities in order to resolve the
issue of over-capacity in this market segment.

The 50% inclusion of ABB ALSTOM POWER has led to a significant
shift in the geographical spread of the Company?s employee base.
Whilst France, the United Kingdom and Germany remain the top
three countries of employment for ALSTOM people in absolute
terms, their percentage of the total employee population has
decreased notably in favour of the rest of Europe, North America
and Asia-Pacific. This shift is even more pronounced when 100% of
Power employees are fully integrated.

 

Outlook

Since its flotation in 1998, ALSTOM has taken on a completely
new dimension and significantly reinforced its strategic
positioning, to an even greater extent than anticipated at that
time. This step change has been achieved through a combination of
strong organic growth complemented by active management of the
Company?s portfolio of activities, with major disposals and
acquisitions completed during the period. As a result, the
Company now ranks a strong N°1 or N°2 across its three
main businesses.

ALSTOM?s goal going forward is clearly to sustain and enhance
its leading market positions whilst applying management
excellence to reach world-class profitability. This can be
achieved by significantly increasing operating performance and by
enhancing the cash generation of operations whilst leveraging the
new market opportunities linked to deregulation and increased use
of IT-based technology. At the same time, the Company will
maintain its flexible approach in the strategic management of its
assets.

Whilst management expects to achieve the overall 6% operating
margin target in 2002/03, ALSTOM?s improved competitive position
coupled with current favourable market trends and improved global
economic conditions clearly strengthens the Company?s longer term
financial prospects. In addition, the complete integration of
ALSTOM Power which will be fully accounted for in 2000/01 will
enable ALSTOM to benefit one hundred per cent from the turnaround
and synergy potential of this activity.

 

Comments by Sector

Energy

The strong increases in orders received (+48%) and sales
(+42%) in Energy are mainly due to the change in scope during the
period, making direct comparisons difficult.

Significant growth in orders was recorded in the gas segment,
particularly heavy duty gas turbines and combined cycle power
plants with major orders in the United States, Mexico and Spain.
In the United States alone, orders were received for over 3.4 GW
of gas-fired capacity in a market where in its former
configuration, ALSTOM was not present due to the terms of its
licence agreement with General Electric in the field of heavy
duty gas turbines.

Major steam orders were obtained in Asia and the Americas
including the 3x660 MW Manjung power plant in Malaysia, the 250
MW Neyvelli plant in India and the Tamuin 2 x 130 MW plant in
Mexico.

In addition further progress was made in the service segment
with an important order to rehabilitate a coal-fired plant in
Poland incorporating the re-powering of three 200MW units and the
creation of a joint venture with NTPC for service activities in
the Indian sub-continent. Services already represent 30% of the
total Power business.

The operating income of 117 million in 1999/2000
reflects the post-closing transition period following the
creation of ABB ALSTOM POWER.

In the first quarter, ALSTOM?s former Energy sector (including
heavy duty gas turbines) recorded an operating income of
42 million. During the second and third quarters, the 50%
consolidation of ABB ALSTOM POWER contributed only marginally to
ALSTOM?s operating performance at 31 million. In the
fourth quarter, an operating income of 44 million was
recorded in ALSTOM?s results representing an operating margin of
3.8% compared to the average 2.6% of the full year and reflecting
profitability improvement within this Sector.

Transmission & Distribution

Transmission and Distribution has experienced difficult market
conditions during 1999/2000, particularly during the first nine
months of the period. The reported 1% and 4% increases in orders
received and sales respectively are influenced by the inclusion
of a number of overseas Transmission and Distribution activities
formerly consolidated in Industry figures.

On a comparable basis, orders received decreased by 9% and
sales by 5%. This is mainly a consequence of the low level of
investment in Asia and a slowdown in investment in European
markets due to the on-set of deregulation, notably in the United
Kingdom and more recently in Germany.

By contrast, orders received increased strongly in North
America where Transmission and Distribution is taking advantage
of the large number of power generation projects and the rapid
development of the energy management market, a field in which
ALSTOM is already ranked world leader.

The impact of the lower than average investment in Asia and
Europe is concentrated in the High Voltage transmission and
systems activities. Positive signs of recovery were observed
during the Fourth Quarter of the year, when orders on a
comparable basis were 10 % above the level recorded in the same
period one year previously.

Major orders received during the year include energy
management systems in South Korea, Mali, Mauritius and the United
States, digital control systems for substations in Iran, Italy,
Abu Dhabi and the United States and Gas Insulated substations in
Mexico, Dubai, Bahrain and Kuwait.

At 233 million, Transmission & Distribution?s
operating income in 1999/2000 includes 17 million
generated by the newly consolidated overseas activities. On a
comparable basis the decrease in operating income compared to
1998/99 is a direct result of the lower volume of activity in
high voltage transmission systems and transformers as well as
increasing price pressure in these market segments.

In this context, Transmission and Distribution has followed a
clear strategy of prudent selection of projects followed on the
one hand and on-going cost reduction and accelerated
restructuring on the other. Indeed, restructuring plans covering
units in several European countries have been implemented in
order to adapt production capacity to the new market
characteristics. This strategy has enabled Transmission and
Distribution to stabilise its operating margin at 8.8%.

The new organisational structure implemented during the year,
regrouping the existing activities into three businesses i.e.
Transmission, Distribution and Protection and Control and
creating two new service-related businesses i.e. Network Planning
and Operations & Maintenance, reflects more closely the needs
of Transmission & Distribution?s customers and will enable
the Sector to focus its strategy on the higher growth, higher
margin activities which are service and IT-related.

 

Transport

The 13% and 16% increases of orders received and sales
respectively in Transport in 1999/2000 are all the more striking
given that the scope of this Sector has essentially remained
stable during the period. This strong organic growth is primarily
due to the development of higher margin potential activities such
as Services and Signaling, reinforced in previous years by a
series of strategic acquisitions. These two activities combined
represented 42% of Transport?s order intake during the period.

Major orders received during the year include : 28 METROPOLISTM
trainsets and the complete signaling system for Shanghai Metro
Line 3 (China), 44 metro cars and complete signaling and other
infrastructure systems for Line 4 of the Caracas Metro
(Venezuela), and 100 commuter coaches for the New Jersey Transit
Authority, the first major order of its kind in North America.

Major deliveries during the year include : 8 complete high-speed
TGV trainsets and equipment supply for the local production of
TGV sets in Korea, single and double deck electric multiple units
for SNCF and 158 refurbished metro cars for the Chicago Metro in
the United States. In addition 1999/2000 saw the inauguration of
the Arlanda Airport Rail Link in Sweden for which ALSTOM has
supplied all of the electrical and mechanical equipment,
trainsets and a complete signaling system.

At 31 March 2000, Transport?s order book stood at 7 137
million excluding long-term Transport maintenance contracts which
accounted for a further 3.6 billion of firm orders.

Despite the increase in operating income from 211 million
in 1998/99 to 231 million in 1999/2000, Transport?s
operating margin dropped slightly to 5.6% This is mainly due to
lower margins in Transport?s traditional activities as a result
of the end of major domestic rail programmes. In addition, in
rolling stock operating income is increasing less rapidly than
sales due to difficulties on certain specific contracts which are
now under control. At the same time, whilst the development of
service and signaling continued strongly during the year, these
higher margin activities have not yet reached their full
potential in terms of operating returns.

 

Industry

Following the complete refocusing of the Sector partially
completed during the financial year, orders received amounted to
1 017 million. The various changes in scope including
disposals and transfers to other Sectors resulted in a mechanical
decrease in orders of 1 251 million. Orders received in
the newly created Power Conversion amounted to 629 million
: in drives and controls, orders were down slightly on last year
due to low investment in the steel industry, especially in the
United Kingdom, whilst in motor and generators, orders rose
significantly due to the introduction of a new range of compact
generators and a complete re-engineering of the sales force.

Major orders received during 1999/2000 include marine propulsion
systems for major cruise operators via ALSTOM?s Marine Sector, a
number of modernisation projects for major metal producers in
Belgium, Canada and India and the first order received by Power
Conversion?s US-based robotics operation for the supply of
remote-operated vehicles for off-shore oil and gas exploration.

Sales in 1999/2000 amounted to 1 110 million after a
mechanical decrease of 1 164 million linked to scope
changes.

The decrease in operating income to 21 million is mainly
due to the disposal of businesses. Taking into account the fact
that the operating income of 24 million reported in
1998/99 included 41 million of income generated by
industrial systems and services and overseas businesses
consolidated elsewhere in 1999/2000, operating income has
increased strongly on a comparable basis. The increase is largely
due to actions taken to reduce costs and improve margins in the
Power Conversion activities in the United Kingdom, Germany and
US. This new Sector is now well positioned to further improve its
operating performance.

Marine

The 25% decrease in orders received in Marine is due to the
exceptionally high level of order intake during the previous year
and does not reflect a slowdown in demand in the cruise-ship
market which continues, on the contrary, to boom.

Major orders received during the year include three cruise-ships,
two of which with over 1 000 cabins, two high-speed ferries for
NEL Lines (Greece) and two military frigates for the Moroccan
Navy. In addition, Marine received a letter of intention from
Carnival/Cunard Lines for the construction of the 2 800 passenger
transatlantic cruise liner, 'Queen Mary 2' which will be the
largest cruise ship ever to be built.

1999/2000 saw the successful delivery of four cruise ships, with
two other vessels, including the 2 000 passenger Millennium
cruise-ship reaching the stage of sea-trials. The resulting 59%
increase in sales is due to the high level of orders received
since 1998 as well as the continued success of the CAP 21
strategic plan. This latter is also the main contributing factor
to the near three-fold increase in operating income and strong
margin improvement.

During the year, as part of the CAP 21 programme, Marine?s main
shipyard at St Nazaire has undergone a complete physical
restructuring with the construction of a ring-road around the
yard and the building of additional cloakroom and canteen
facilities for employees and sub-contractors. This has led to
increased efficiency and improved utilisation of the yard?s
industrial facilities as well as the successful transition to the
35-hour working week, as required under new French labour
legislation. As a result, Marine is well on line to achieve its
targets of 30% cost reduction and 4-5 ship deliveries per
annum.

Contracting

Orders received in Contracting increased by 34% including the
industrial systems and services and other activities transferred
to the Sector during the year.

On a comparable basis, the 5% and 9% increases in orders received
and sales respectively bear witness to a general improvement in
economic conditions in Western Europe, particularly in France and
Benelux.

Major orders received include the installation of power supply at
ELF?s headquarter building, facility management projects in
France, the renovation of the SCADA control system for water and
gas supplies in the city of Stuttgart (Germany) as well as the
electrification of 326 Moroccan villages as part of a rural
development programme in the country.

Contracting continued to implement its strategy to focus on
higher growth, higher margin activities notably with the
acquisition in France of climate-control specialists Missenard
Quint and Electricité et Technique.

During 1999/2000 Contracting reached the operating margin
objective set for this Sector at the time of its integration in
ALSTOM two years ago. This was achieved partly due to the
increased volumes in the business, on-going cost reduction
efforts and the focus on higher margin activities, particularly
facility management and industrial maintenance.

 

Press enquiries: G. Tourvieille / S. Gagneraud

(Tel. +33 1 47 55 23 15 or 1 47 55 25 87)

gilles.tourvieille@chq.alstom.com

severine.gagneraud@chq.alstom.com

Investor relations: H. Green (Tel. +33 1 47 55 25 78)

investor.relations@chq.alstom.com

Internet :
http://www.wcm.alstom.com

 

* * *

 

Explanatory Notes : Basis of Presentation

1999/00 Energy figures include for the period 1 April ? 30 June
1999, 100% of ALSTOM?s Energy Sector, still including the heavy
duty gas turbine business sold to General Electric on 25 June and
the remaining businesses contributed to the new joint company,
ABB ALSTOM POWER on 30 June 1999, and for the period 1 July ? 31
March, 50% of ABB ALSTOM POWER.

1999/2000 Industry figures reflect the following transfers of
activities to other Sectors and disposals

The Industrial Systems and Services business and a number of
former Cegelec foreign subsidiaries have been tranferred to the
Contracting representing orders of 394 million, sales of
369 million and operating income of 9 million.

ALSTOM Overseas multi-product operations in Australia, New
Zealand, South Africa and India have been allocated to the Sector
corresponding to the different activities. These operations
represent orders of 597 million, sales of 514
million and operating income of 32 million.

III. Disposals of a number of businesses were completed in
1999/2000 in the fields of gears, valves, automated assembly
lines and painting systems. In total, these activities represent
orders of 260 million and sales of 281 million.

 

* * *

'Safe Harbor' statement under the United States Private
Securities Litigation Reform Act of 1995 :

'This 'Management Discussion' contains 'forward looking
statements' as that term is defined in the United States Private
Securities Litigation Reform Act of 1995 including those
statements under the heading 'Outlook' and others elsewhere
relating to market forecasts and the Company?s future performance
and business and financial plans. These 'forward looking
statements' are based on the Company?s current expectations and
assumptions. However such statements are subject to certain known
and unknown risks and uncertainties and actual results may differ
materially from those anticipated in the forward looking
statements. These include, in most cases, with respect to both
ALSTOM and ABB ALSTOM POWER, without limitation the inherent
difficulty of forecasting future market conditions, costs and/or
cost savings at certain times and/or in certain markets, timing
of completion of the strategic repositioning in the field of
Industry and the risks and other uncertainties listed from time
to time in ALSTOM's public filings, including but not limited to
the 'Risk Factors' which impact the Company and ABB ALSTOM POWER
business or operations contained in ALSTOM's Prospectus dated
June 22, 1998 filed with the French COB and the United States
Securities and Exchange Commission in connection with ALSTOM's
initial offering '.