Alstom (ALO) H2 24/25 earnings summary

Executive summary

• Orders reached €19.8 billion for FY 2024/25, with strong Q4 momentum and a book-to-bill ratio of 1.1, meeting guidance.

• Sales totaled €18.5 billion, up 6.6% organically, with adjusted EBIT rising 18% to €1,177 million (6.4% margin).

• Free cash flow was €502 million, a significant turnaround from the prior year, and net debt reduced to €434 million.

• Integration of Bombardier Transportation is complete, with focus now on industrial efficiency, digitalisation, and standardization.

• Strategic priorities advanced, including backlog quality, project execution, and manufacturing optimization.

Financial highlights

• Adjusted EBIT margin increased by 70 basis points to 6.4% year-over-year.

• Adjusted net profit was €498 million, up from €44 million, showing improved earnings quality.

• Adjusted EBITDA reached nearly €1.5 billion (8% of sales), up from €1.1 billion (6.4%) last year.

• Non-operating expenses dropped below €200 million, with integration costs at €97 million and legal costs at €36 million.

• Net financial debt reduced to €434 million, down from €3 billion, driven by deleveraging and positive free cash flow.

Outlook and guidance

• FY 2025/26 guidance: book-to-bill above 1, organic sales growth of 3–5%, adjusted EBIT margin around 7%, and free cash flow of €200–400 million with higher seasonality.

• Three-year cumulative free cash flow target above €1.5 billion, with adjusted EBIT margin ambition of 8–10% and free cash flow conversion trending toward 100%.

• Medium-term: continued improvement in backlog margin and industrial efficiency, with gross margin expected to rise by 1 percentage point per year.