Alstom Profit Jumps as Train Maker Focuses on Signals Growthby
French company reiterates 2020 earnings, sales growth targets
Will pay dividend of 0.25 euros a share for full year
Alstom SA full-year profit jumped as the French rail-equipment maker increased its focus on signalling and services to boost revenue.
Adjusted earnings before interest and taxes climbed 15 percent to 421 million euros ($459 million) in the year through March, the Saint-Ouen-based company said in a statement on Thursday. That beat a 416 million-euros estimate of eight analysts compiled by Bloomberg. Alstom will propose a dividend of 0.25 euros per share to shareholders in July.
“With 10 billion euros orders for the third year in a row, Alstom has now reached leadership positions on all continents,” Chief Executive Officer Henri Poupart-Lafarge said in the statement. “Alstom’s unique integration capability and its operational excellence have enabled a solid delivery of its record backlog."
Alstom, which became a transport-focused company after selling most of its energy assets to General Electric Co. in 2015, is looking into how it can participate in consolidation of the rail industry, as international rivals Siemens AG and Bombardier Inc. are said to be discussing a tie-up. The French company is relying on urban transport growth to boost sales, including the launch of an electric bus and an investment in a startup that develops electric driverless shuttles.
The company reiterated targets for 2020, including an adjusted earnings before interest and taxes margin of 7 percent and an annual 5 percent organic growth over the period. Organic sales grew 5 percent to 7.3 billion euros in the past year.
Signalling, systems and services represented 57 percent of total sales, in line with the 2020 objective of 60 percent, Alstom said.
The company is almost 20 percent owned by the French government. The shares fell 0.3 percent to 29.08 euros on Wednesday, and have gained almost a third in the past 12 months.