ALSTOM first half results 2004
Press Contacts
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First Half Results impacted by uncertainties over
ALSTOM's situation
- Orders received: 7.4bn, down 23% on a
comparable basis - Sales: 8.9bn, down 9% on a comparable
basis - Operating margin: 1.5%
- Net income: (624)m
- Free cash flow: (674)m
- Economic debt reduced to 4.5bn
Progress on action plan
- 2.5 bn proceeds from disposals secured
- Financing package announced 22 September to strengthen
the Group's financial structure, with positive feedback from
customers - Significant progress made on GT24/GT26 gas turbines
issue - Operational performance: restructuring accelerated with
cost-reduction programmes underway
* * *
Commenting on the results Patrick Kron, Chairman & Chief
Executive Officer, said:
'ALSTOM's results for the first half of fiscal year 2004,
though unsatisfactory, are generally in line with previous
guidance.
Our low level of order intake mainly reflects weak demand
for new power equipment, the impact of customer concerns
surrounding ALSTOM's past financial position and difficulties
experienced during the period in obtaining contract bonds. Our
income was hit by additional charges on some US contracts and a
significant increase in financial and restructuring
charges.
The financing package announced on 22 September 2003 is
designed to strengthen substantially the Group's financial
structure and we are now seeing positive reactions from
customers, as illustrated by 700 million in orders
having been secured in October by our Transport Sector. Despite
difficult circumstances, we managed during the first half to
win good orders such as trams and metros in Europe, gas
turbines in Algeria, a combined cycle plant in Bahrain, Power
service in the US and Brazil and a major utility boiler in
China.
We also made significant progress on the action plan
announced last March designed to improve Group profitability
and cash generation, to close out past operational issues and
reduce our level of debt. To date we have secured
2.5 bn proceeds from disposals, including our small and
medium-sized industrial turbines and our transmission &
distribution activities; we continue to make encouraging
headway on the GT24/GT26 issue, while major restructuring and
cost-reduction programmes are underway worldwide to drastically
cut our cost base.
My priority, and that of ALSTOM's management team, remains
the continued full implementation of this action plan. The
September financing agreement will be submitted for approval at
a Shareholders' Meeting on 18 November and will be fully
implemented as soon as possible thereafter. It will
substantially increase our equity base through a capital
increase and issue of bonds redeemable in shares, while
providing the Group with adequate medium to long-term financing
and on-going liquidity and contract bonding coverage. I believe
the financing agreement is also a strong signal to the market
that ALSTOM is back in normal business, not only with a
commitment to meeting its operational improvement objectives,
but above all its customers' needs and expectations.'
- ends -
A summary of ALSTOM s MD&A for the six-month period is
attached. A full copy of this document, which takes precedence
over this press release, is available on ALSTOM's website,
together with a full set of accounts and notes (
www.alstom.com).
Press relations:
S. Gagneraud / G. Tourvieille
(Tél. +33 1 47 55 25 87)
internet.press@chq.alstom.com
Investor relations:
E. Chatelain
(Tél. +33 1 47 55 25 33)
Investor.relations@chq.alstom.com
M Communications:
L. Tingström
Tel. + 44 789 906 6995
The full press release, including summary of the MD & A is
attached below:-