In This Article:
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Order Intake: EUR10.9 billion in the first half.
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Book-to-Bill Ratio: 1.25.
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Organic Sales Growth: 5.6% increase.
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Adjusted EBIT: EUR515 million, up 18% year-over-year.
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Adjusted EBIT Margin: 5.9%.
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Free Cash Flow: Negative EUR138 million.
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Gross Margin in Backlog: 17.8% at the end of the first half.
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Sales: EUR8.775 billion in the first half.
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Net Financial Debt: EUR927 million at the end of September.
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Capital Expenditure: 2.5% of sales in the first half.
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Effective Tax Rate: 37%.
Release Date: November 13, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Alstom SA (ALSMY) reported a strong commercial momentum with EUR10.9 billion in order intake for the first half, supporting their growth strategy.
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The company achieved a book-to-bill ratio of 1.25, indicating a healthy balance between orders received and revenue recognized.
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Adjusted EBIT increased by 18% to EUR515 million, with a margin of 5.9%, driven by growth, cost savings, and improved gross margins.
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Alstom SA (ALSMY) maintained its guidance for the full year, expecting around 6.5% adjusted EBIT margin and positive free cash flow between EUR300 million to EUR500 million.
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The company is seeing robust demand and a strong pipeline, with significant projects in Germany, Western Australia, and France contributing to future growth.
Negative Points
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Free cash flow was negative EUR138 million, although better than the initial guidance of negative EUR300 million to EUR500 million.
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Supply chain challenges have impacted project execution, with 60% to 70% of delays attributed to these issues.
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The rolling stock production decreased by 11% compared to the same period last year, affecting overall production targets.
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The company faces ongoing challenges with legacy projects like Aventra, which continue to weigh on the P&L.
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There is uncertainty regarding the impact of potential tariffs in the US, although the company has a largely US-based supply chain.
Q & A Highlights
Q: Could you give us more detail on the impact of supply chain challenges and how they have affected your financial performance? A: Henri Poupart-Lafarge, CEO: We have been quite agile in adapting to supply chain challenges, focusing on suppliers facing difficulties. Although 60% to 70% of project delays are due to supply chain issues, we achieved our sales targets and managed to limit financial impact. The good commercial momentum and higher progress payments have helped mitigate these issues.
Q: Are tariffs a concern for your US business, especially with potential changes in the political environment? A: Henri Poupart-Lafarge, CEO: In the US, our supply chain is largely US-based, with 90% to 95% of production occurring domestically. We do not expect significant changes due to political shifts. We are actively managing the supply chain, and while some issues are localized in the US, we do not foresee major disruptions.