Alstom’s orders and sales for the first nine months of 2020/21
- Level of order intake at €4.5 billion, with solid order intake in Q3, and sustained record backlog at €40.1 billion
- 9 months sales at €5.6 billion, in line with targeted trajectory
- Full year outlook and mid-term 2022/23 guidance confirmed, supported by positive Q4 commercial pipeline and mid-term rail market perspectives
Alstom leadership in ESG confirmed
For the first nine months of 2020/21 (from 1 April to
The backlog, on
Key figures
Actual figures | 2019/20 | 2020/21 | 2019/20 | 2020/21 | Var. % | Var. % | ||||||||
(in € million) | Q1 | Q2 | Q3 | Q4 | Q1 | Q2 | Q3 | 9 months | 9 months | Actual | Organic | |||
Orders received | 1,620 | 2,998 | 3,563 | 1,719 | 1,651 | 1,001 | 1,836 | 8,181 | 4,488 | (45%) | (45%) | |||
Sales | 2,054 | 2,086 | 2,060 | 2,001 | 1,507 | 2,011 | 2,049 | 6,200 | 5,567 | (10%) | (8%) |
Geographic and product breakdowns of reported orders and sales are provided in Appendix 1. All figures mentioned in this release are unaudited.
“During the third quarter,
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Detailed review
During the third quarter of 2020/21 (from 1 October to
Orders in Signalling and Services were positive with respectively €452 million and €431 million booked during the quarter.
Regarding sales, €2,049 million were traded in the third quarter 2020/21 (from 1 October to
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Main events of the third quarter 2020/21
v Key project deliveries
In
v Investment
In
v Smart and green mobility
In
In
Finally, in
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During the third quarter of 2020/21,
For the tenth consecutive year,
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On
On
All the regulatory approvals necessary for the completion of the Acquisition having been received, the completion of the acquisition is expected to take place on
***
Outlook for fiscal year 2020/212
In 2019/20, the Group launched the
The Covid-19 crisis is negatively affecting the financial performance of the 2020/21 fiscal year. Yet,
- Commercial performance allowing a book to bill ratio above one;
- Sales between €7.6bn and €7.9bn;
- An adjusted EBIT margin in the 7.7% - 8.0% range;
- Breakeven to positive Free Cash Flow generation4.
Mid-term outlook for fiscal year 2022/23²
The outlook given in connection with the
In the context of the Covid-19 crisis, the objective of a 5% average annual growth rate over the period from 2019/20 to 2022/23 should be slightly impacted by the temporary slowdown of tender activity, yet the 2022/23 objectives of 9% aEBIT margin and of a conversion from net income to free cash flow above 80% are confirmed.
With a strong liquidity position, a demonstrated ability to deliver execution and profitability and the rapid launch of a cost and cash mitigation plan the Group is confident in its capacity to weather the crisis as well as to capture opportunities in a resilient rail market and contribute to the transition towards sustainable transport systems.
About | |||
Leading the way to greener and smarter mobility worldwide, | |||
Contacts | Press: Coralie COLLET - Tel.: +33 (1) 57 06 18 81 coralie.collet@alstomgroup.com Samuel MILLER - Tel.: +33 (1) 57 06 67 74 Samuel.miller@alstomgroup.com Investor relations: Julie MOREL - Tel.: +33 (6) 67 61 88 58 Julie.morel@alstomgroup.com Claire LEPELLETIER – Tel.: +33 (6) 76 64 33 06 claire.lepelletier@alstomgroup.com |
This press release contains forward-looking statements which are based on current plans and forecasts of Alstom’s management. Such forward-looking statements are relevant to the current scope of activity and are by their nature subject to a number of important risks and uncertainty factors (such as those described in the documents filed by
FY 2020/21 forecasts are based on Alstom’s scope of consolidation at the end of
- The sales improvement in the second semester as compared to the first semester will primarily come from a decrease in the Covid-19 related disruptions that affected
Alstom during the first half of this fiscal year, and from the execution of its orders backlog. - The adjusted EBIT margin improvement compared to the first semester will primarily come from additional volume, rigorous project execution, and the delivery of projected sourcing savings.
- Standardisation of engineering tools and processes together with design to cost, and optimisation of our footprint both for engineering and manufacturing, will also support the improvement of Alstom performance. In addition, digital transformation, combined with efficient discipline in overhead cost management, will contribute to the improvement of the adjusted EBIT margin.
- Improved cash generation over the second semester as compared to the first semester will mainly come from accelerated deliveries and commercial performance. It remains subject to usual short-term volatility in down- and progress payments from clients.
Macro-economic assumptions
- They have been established excluding any major variations in exchange rates of the currencies of the main countries outside of Euro-zone in which the Group generates its revenues, compared to the rates in effect as at 30 September 2020.
- They assume an overall stable political environment in areas where
Alstom operates or delivers products. - They assume the absence of Covid-19 crisis-related production slowdowns, arising from partial or full lockdown situations, that would exceed the lockdown measures in place on the date of this document and affecting either Alstom or its key suppliers. In addition, they assume that customer tenders scheduled for the second semester will not considerably shift to later periods and that train mileage for purposes of calculating indexed payments under maintenance contracts will not decrease very significantly during the remainder of the second semester due to the ongoing health crisis.
This press release does not constitute or form part of a prospectus or any offer or invitation for the sale or issue of, or any offer or inducement to purchase or subscribe for, or any solicitation of any offer to purchase or subscribe for any shares or other securities in the Company in
APPENDIX 1A – GEOGRAPHIC BREAKDOWN
Actual figures | 2019/20 | % | 2020/21 | % |
(in € million) | 9 months | Contrib. | 9 months | Contrib. |
6,092 | 74% | 2,674 | 59% | |
504 | 6% | 324 | 7% | |
1,531 | 19% | 611 | 14% | |
54 | 1% | 879 | 20% | |
Orders by destination | 8,181 | 100% | 4,488 | 100% |
Actual figures | 2019/20 | % | 2020/21 | % |
(in € million) | 9 months | Contrib. | 9 months | Contrib. |
3,500 | 56% | 3,263 | 59% | |
1,015 | 16% | 902 | 16% | |
655 | 11% | 671 | 12% | |
1,030 | 17% | 731 | 13% | |
Sales by destination | 6,200 | 100% | 5,567 | 100% |
APPENDIX 1B – PRODUCT BREAKDOWN
Actual figures | 2019/20 | % | 2020/21 | % |
(in € million) | 9 months | Contrib. | 9 months | Contrib. |
Rolling stock | 4,099 | 50% | 1,370 | 30% |
Services | 2,719 | 33% | 1,251 | 28% |
Systems | 91 | 1% | 847 | 19% |
Signalling | 1,272 | 16% | 1,020 | 23% |
Orders by destination | 8,181 | 100% | 4,488 | 100% |
Actual figures | 2019/20 | % | 2020/21 | % |
(in € million) | 9 months | Contrib. | 9 months | Contrib. |
Rolling stock | 2,897 | 47% | 2,781 | 50% |
Services | 1,109 | 18% | 1,013 | 18% |
Systems | 1,078 | 17% | 657 | 12% |
Signalling | 1,116 | 18% | 1,116 | 20% |
Sales by destination | 6,200 | 100% | 5,567 | 100% |
APPENDIX 2 - NON-GAAP FINANCIAL INDICATORS DEFINITIONS
This section presents financial indicators used by the Group that are not defined by accounting standard setters.
Orders received
A new order is recognised as an order received only when the contract creates enforceable obligations between the Group and its customer.
When this condition is met, the order is recognised at the contract value.
If the contract is denominated in a currency other than the functional currency of the reporting unit, the Group requires the immediate elimination of currency exposure through the use of forward currency sales. Orders are then measured using the spot rate at inception of hedging instruments.
Order backlog
Order backlog represents sales not yet recognised on orders already received.
Order backlog at the end of a financial year is computed as follows:
- order backlog at the beginning of the year;
- plus new orders received during the year;
- less cancellations of orders recorded during the year;
- less sales recognised during the year.
The order backlog is also subject to changes in the scope of consolidation, contract price adjustments and foreign currency translation effects.
Order backlog corresponds to the transaction price allocated to the remaining performance obligations, as per IFRS 15 quantitative and qualitative disclosures requirement.
Book-to-Bill
The book-to-bill ratio is the ratio of orders received to the amount of sales traded for a specific period.
Adjusted EBIT
When Alstom’s new organisation was implemented in 2015, adjusted EBIT (“aEBIT”) became the Key Performance Indicator to present the level of recurring operational performance. This indicator is also aligned with market practice and comparable to direct competitors.
Going forward (1st application for Half Year 2019/2020 publication),
aEBIT corresponds to Earning Before Interests and Tax adjusted for the following elements:
- net restructuring expenses (including rationalization costs);
- tangibles and intangibles impairment;
- capital gains or loss/revaluation on investments disposals or controls changes of an entity;
- any other non-recurring items, such as some costs incurred to realize business combinations and amortisation of an asset exclusively valued in the context of business combination as well as litigation costs that have arisen outside the ordinary course of business;
- and including the share in net income of the operational equity-accounted investments.
A non-recurring item is a “one-off” exceptional item that is not supposed to occur again in following years and that is significant.
Adjusted EBIT margin corresponds to Adjusted EBIT in percentage of sales.
Free cash flow
Free cash flow is defined as net cash provided by operating activities less capital expenditures including capitalised development costs, net of proceeds from disposals of tangible and intangible assets. In particular, free cash flow does not include the proceeds from disposals of activity.
The most directly comparable financial measure to free cash flow calculated and presented in accordance with IFRS is net cash provided by operating activities.
Net cash/(debt)
The net cash/(debt) is defined as cash and cash equivalents, other current financial assets and non-current financial assets directly associated to liabilities included in financial debt, less financial debt.
Pay-out ratio
The pay-out ratio is calculated by dividing the amount of the overall dividend with the "Net profit from continuing operations attributable to equity holders of the parent” as presented in the consolidated income statement
Organic basis
Figures given on an organic basis eliminate the impact of changes in scope of consolidation and changes resulting from the translation of the accounts into Euro following the variation of foreign currencies against the Euro. The Group uses figures prepared on an organic basis both for internal analysis and for external communication, as it believes they provide means to analyse and explain variations from one period to another. However, these figures are not measurements of performance under IFRS.
9 months | 9 months | |||||||||||
(in € million) | Actual figures | Exchange rate | Scope impact | Comparable Figures | Actual figures | Exchange rate | Scope impact | Comparable Figures | % Var Act. | % Var Org. | ||
Orders | 8,181 | (91) | 8,090 | 4,488 | 4,488 | (45)% | (45)% | |||||
Sales | 6,200 | (169) | 6,031 | 5,567 | 5,567 | (10)% | (8)% |
1 Lateral signalling is the signalling in force before the deployment of the European ERTMS signalling system. It is still used on the vast majority of lines (excluding high speed lines).
2
3 The fiscal year 2020/21 outlook assumes the absence of Covid-19 crisis-related production slowdowns, arising from partial or full lockdown situations, that would exceed the lockdown measures in place on the date of this document and affecting either
4 Subject to the usual short-term volatility in the timing of receipt of down payments and milestone payments owed by customers
Attachment
- 2021-01-19 PR Q3 2020-21
© OMX, source