Alstom closes quarter with $6.91 billion in orders

During the third quarter of 2012/13 (from October 1 to December 31, 2012), Alstom recorded a level of orders of $6.91 billion, an increase of 3% over the same period last year. The Transportation sector had a pretty solid commercial performance, with orders of $2.30 billion. Thermal Power received orders of $2.16 billion during the third quarter, with a smaller number of large projects, but with a steady stream of small and medium contracts. Finally, Renewable Power orders reached $813 million, a significant increase compared to the previous two quarters, and Grid registered orders of around $1.49 billion. Group sales had recovered, and rose 1% during the third quarter of 2012/13.

For the first nine months of 2012/13 (from April 1 to December 31, 2012), incoming orders in Alstom reached $23.3 billion, an increase of 14% compared to the first nine months of 2011/12. The growth in the orders continued to be supported by emerging markets, representing 48% of total orders in late December 2012, as well as robust demand in Transportation. Group sales reached $19.92 billion, an increase of 3% compared to the first nine months of 2011/12.

With $70.46 billion at December 31, 2012, the backlog represented 30 months of sales.

In an environment that remains challenging, we achieved a solid third quarter in 2012/13, with orders of $6.91 billion, despite the smaller number of large projects in Thermal Power. Demand remains active in emerging markets for all Sectors, while Transport recorded a large number of contracts in Europe during the period. The book-to-bill index is above 1 for the ninth consecutive quarter. Thanks to our current business, we expect the incoming orders are strong in the fourth quarter, with sales that keep the recovery,” said Patrick Kron, Alstom’s Chairman & CEO.

Sector Review

Thermal Power – During the third quarter of 2012/13, Thermal Power recorded orders of $2.195 million, a decrease of 13% compared to the same period last year, due to the lack of turnkey contracts in the quarter. The commercial performance of Thermal Power was supported by demand for new equipment in emerging countries as well as by the activity of services including retrofit. In particular, the Sector recorded three gas turbines (one in Jordan and two in China), as well as parts for gas turbines in Libya and a retrofit contract for a coal plant in South Africa. Sales grew 4%, to $3.156 million.

For the first nine months of 2012/13, Thermal Power incoming orders reached $8.652 million, a decrease of 2% compared to the same period last year. Sales totaled $8.926 million, an increase of 5% compared to last year.

Renewable Power – During the third quarter of 2012/13, Renewable Power recorded $834.77 million in new contracts, doubling the level of orders recorded in the same period last year. The backlog of the Sector was driven mainly by two hydropower projects in Colombia and Ethiopia, with small orders also registered in wind and hydropower. Sales totaled $552.90 million in the third quarter of 2012/13, an increase of 11% over the same period last year. This increase was primarily due to sales performed to large hydropower projects being performed in Brazil.

During the first nine months of 2012/13, Renewable Power orders fell by 8% to $1.650 million, against $1.794 million in the same period last year. The sector recorded sales of $1.712 million, a decrease of 10% compared to last year.

Grid – During the third quarter of 2012/13, Grid reached a solid level of orders of $1.482 million, a decrease of 6% from the high level reached in the third quarter of 2011/12, when Alstom recorded a big HVDC contract in Sweden. During the quarter, the Sector recorded a large number of small contracts around the world. Sales reached $1.16 billion in the third quarter, a drop of 12%. Sector activity was also affected by an unfavorable basis of comparison (activity that occurred in the third quarter of last year to electronics business for power plants in Russia) and by project delays due to clients (mainly in India).

During the first nine months of 2012/13, the Grid orders totaled $4.436 million, an increase of 8%, while sales reached $3.692 million, a decrease of 4% compared with the same period last year.

Transportation – During the third quarter of 2012/13, orders registered by Transportation totaled $2.336 million, showing another strong quarter in terms of commercial activity. Major successes included regional trains in Italy and Germany, metro cars in Brazil, a maintenance contract in Kazakhstan, as well as a modernization contract in the United States. Sales – of $1.795 million – increase 4% compared to the same period last year.

During the first nine months of 2012/13, Transportation orders stood at $8.545 billion, an increase of 50% compared to the same period last year. Sales reached $5.550 million, an increase of 10% compared to the first nine months of 2011/12.

Main events of the third quarter of 2012/13

During the third quarter of fiscal year 2012/13, Alstom continued to increase its industrial capacity in rapidly growing countries and strengthening its new technologies.

In Kazakhstan, Alstom launched the first electric freight locomotive for the Kazakh Railways. Alstom also inaugurated its newly built locomotive plant in Astana, which is operated by EKZ, a joint venture with the KTZ (50% of the shares), Alstom and TMH (25% of the shares each). The plant will have a capacity of up to 100 locomotives per year.

In Brazil, Alstom announced the installation of its first plant dedicated to the production of towers for wind turbines in Latin America. The new unit will have an installed capacity of 120 towers per year, which represents around 350 MW. The plant should start operating in the first half of 2013, and has already received orders to supply the Brazilian market. This new plant will be the second manufacturing unit for the Alstom’s infrastructure business of wind power generation in Latin America.

Alstom has invested over $40 million in the U.S. company BrightSource Energy, Inc to strengthen its partnership with the pioneer solar energy company, a leader in concentrated solar thermal towers technology. Since the initial investment in 2010, Alstom has gradually raised its stake and now owns more than 20% of the capital.

Financial condition and prospects

In early October, the Group successfully launched a capital increase of $474.30 million through an accelerated book building, plus a new bond issue of $474.30 million. These two financing transactions helped maintain the solid financial structure of the Group. With strong sales expected for the fourth quarter, the Group should present a solid business performance throughout this fiscal year. Alstom confirms its three-year orientation and anticipates a positive free cash flow for the second half of the current fiscal year.

Fonte: Alstom