Alstom recorded free cash flow of -1.15 billion euros in the first half of its staggered 2023-2024 financial year, which ends on September 30, and expects it to remain negative throughout the year, the manufacturer announced this Wednesday. railway.
The group has published “preliminary” financial information to warn that free cash flow, previously announced as “significantly positive” for the year, would actually be negative, between -500 and -750 million euros.
“We are immersed in a strong momentum, particularly in the Rolling Stock activity, which, added to the inherited projects in the portfolio that were at the same time in the completion phase, weighs on the free cash flow of this first half . “explains CEO Henri Poupart-Lafarge, quoted in the press release.
Increased production rate
Of this negative free cash flow of 1.15 billion, half is due to the manufacturer’s increased production, which led to a sharp increase in inventories to avoid disruptions to production lines. This should “be fully resolved in the coming years,” the group says. Around a third comes from the delay in completing the 443-train Aventra program for the UK, inherited from the Bombardier Transportation portfolio acquired by Alstom. Completion is now scheduled “at the beginning of the 2024-2025 fiscal year,” which will begin April 1, 2024.
The remainder is due to program changes that caused a “decrease in the level of advances received during the first semester” when the contracts were signed. In the second half, free cash flow should be positive, between 400 and 650 million euros, according to Alstom, which has 3.5 billion euros of liquidity.
In the first half, the railway manufacturer had a turnover of 8.3 billion euros, 2.7% more (6.5% with constant scope and exchange rates) and obtained 8.4 billion euros of new orders (- 16.8%). The group confirms its other forecasts, in particular the organic growth of turnover and operating margin for the entire year. Alstom will publish its first half results on November 15.
Source: BFM TV
