ALSTOM SA : Half-year 2024/25 presentation

Disclaimer

●         This presentation 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 Alstom with the French AMF) that could cause actual results to differ from the plans, objectives and expectations expressed in such forwardlooking statements. These such forward-looking statements speak only as of the date on which they are made, and Alstom undertakes no obligation to update or revise any of them, whether as a result of new information, future events or otherwise.

●         This presentation 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 France, the United Kingdom, the United States or any other jurisdiction. Any offer of the Company’s securities may only be made in France pursuant to a prospectus having received the visa from the AMF or, outside France, pursuant to an offering document prepared for such purpose. The information does not constitute any form of commitment on the part of the Company or any other person. Neither the information nor any other written or oral information made available to any recipient, or its advisers will form the basis of any contract or commitment whatsoever. In particular, in furnishing the information, the Company, the Banks, their affiliates, shareholders, and their respective directors, officers, advisers, employees or representatives undertake no obligation to provide the recipient with access to any additional information.

©providedALSTOMwithoutSA 2024liability. Allandrightsis subjectreservedto.changeInformationwithoutcontainednotice. Reproduction,in this documentuse,isalterindicativeor disclosureonly. Notorepresentationthird parties, withoutor warrantyexpressis writtengiven orauthorisation,should be reliedis strictlyon thatprohibitedit is complete.                                                                                                                        or correct or will apply to any particular project. This will depend on the technical and commercial circumstances. It is                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   2

Agenda

†† Highlights of the first half of fiscal year 2024/25

Henri Poupart-Lafarge, Chief Executive Officer

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†† H1 2024/25 financial results

Bernard Delpit, Executive Vice-President and Chief Financial Officer

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†† Conclusion

Henri Poupart-Lafarge, Chief Executive Officer

© ALSTOM SA 2024. All rights reserved. Information contained in this document is indicative only. No representation or warranty is given or should be relied on that it is complete provided without liability and is subject to change without notice. Reproduction, use, alter or disclosure to third parties, without express written authorisation, is strictly prohibited.

Free Cash Flow at €(138) million benefiting from commercial activity

Confirmation of FY 2024/25 outlook

© ALSTOM SA 2024. All rights reserved. Information contained in this document is indicative only. No representation or warranty is given or should be relied on that it is complete provided without liability and is subject to change without notice. Reproduction, use, alter or disclosure to third parties, without express written authorisation, is strictly prohibited.

3-year pipeline at ~€200bn: Asia-Pacific and Middle-East growth

€7.3bn orders in Q2: Landmark wins in Germany, Australia and France and good flow of small orders

Strong backlog with confirmed gross margin improvement trajectory

Backlog stratification – Gross margin evolution

                                    ex-AT Backlog      ex-AT Backlog      ex-AT Backlog     Group Backlog     Group Backlog            Group Backlog               Group Backlog Group Backlog Backlog figures subject to FX evolution

Integration process finishing, amidst rising supply chain challenges

CONTINUED OPERATIONAL PROGRESS       …HINDERED BY SUPPLY-CHAIN CHALLENGES

Relentless effort on optimising execution of all major projects

PARIS PROJECTS DELIVERED     MULTIPLE LEGACY PROJECTS         CONTINUOUS EFFORTS ON AS PLANNED SUCCESSFULLY TURNED AROUND SELECTED PROJECTS

Production shift towards better margin projects with the end of Aventra in Derby

Quantity of cars produced per quarter

                                                                       FY 2022/23     FY 2023/24     FY 2024/25

© ALSTOM SA 2024. All rights reserved. Information contained in this document is indicative only. No representation or warranty is given or should be relied on that it is complete provided without liability and is subject to change without notice. Reproduction, use, alter or disclosure to third parties, without express written authorisation, is strictly prohibited.

H1 orders boosted by strong Q2

Services and Signaling exceed 50% of order intake

ORDERS H1 2024/25 (in €bn)

© ALSTOM SA 2024. All rights reserved. Information contained in this document is indicative only. No representation or warranty is given or should be relied on that it is complete

provided without liability and is subject to change without notice. Reproduction, use, alter or disclosure to third parties, without express written authorisation, is strictly prohibited.                                                                                     13

Group organic growth in line with guidance Double digit Services growth since merger

aEBIT margin improvement in line with FY 2024/25 trajectory

Profit improvement coming from volume and cost savings initiatives

aEBIT (in %)

Improved EBIT drive Net income increase

o/w Integration costs €51m Legal fees and others €31m

Net interest decrease by (€24m) Hedging, bank fees & others increase by + €33m

ETR 37%

1 This mainly includes Chinese joint-ventures  

2 Definition in appendix

Structural FCF seasonality mitigated by improved working capital phasing

From EBIT* to Free Cash Flow (in € million)

Capex / Cap

* EBIT Before PPA and impairment

(1) Change in Working Capital (Trade + Contract working capital change) for €(420)m corresponds to the €(448)million changes in working capital resulting from operating activities disclosed in the condensed interim consolidated financial statements from which the €31 million variations of restructuring provisions and €(2) million of variation of Tax working capital have been excluded. .

Trade Working Capital Seasonality on inventories, discipline maintained on overdues and payables

Inventories increase due to usual H1 seasonality

Trade payables and trade receivables maintained at stable level in H1

1.      Definition in appendix

2.      Excluding restructuring provisions and corporate tax changes

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Contract Working Capital

Larger quantity of projects in startup phase

Net Contract Assets / Liabilities stable since March 2024 at (63) days of sales Provisions on contract risks reducing as planned

1 Definition in appendix

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Net financial debt reduced by €2,067m to €927m following deleveraging plan

31 March 2024       30 September 2024 Net cash/(debt)      Net cash/(debt)

1. Sale of TMH for €75m executed during FY 2023/24. Rights issue, hybrid issuance and sale of US conventional Signaling net of advisory fees.

© ALSTOM SA 2024. All rights reserved. Information contained in this document is indicative only. No representation or warranty is given or should be relied on that it is complete  21 provided without liability and is subject to change without notice. Reproduction, use, alter or disclosure to third parties, without express written authorisation, is strictly prohibited.

Short-term debt reimbursed, strong increase in Cash & cash equivalents

            CASH, CASH EQ. and S/T DEBT (IN € MILLION)                     STABLE OUTSTANDING BONDS (IN € MILLION)

(2,000)_● No financial covenants and fixed coupons on all bonds

    ● No planned redemption before October 2026 ● ~€869m increase in Cash equivalents

● ~€1.2b reimbursement of short-term debt during H1

FY 2024/25 outlook and mid-term ambitions confirmed

Contacts & Agenda

Martin VAUJOUR

VP Investor Relations

Estelle MATURELL ANDINO Deputy Head Investor Relations

investor.relations@alstomgroup.com

Financial Calendar

© ALSTOM SA 2024. All rights reserved. Information contained in this document is given or should be relied on that it is complete or correct or will apply to any particular project. This will depend on the technical and commercial circumstances. It is provided without liability and is subject to change without notice. Reproduction, use, alter

Financial Calendar

Equity in € million

                                                                                                                                                                       3                                  13

March 2024               Capital raise           Movements in other       Net income        Change in controlling     Share based payments  Dividends          September 2024 and Hybrid Bond     comprehensive income  interests and others

H1 2024/25 backlog by region and product line

Backlog breakdown by region (in € million) Backlog breakdown by product line (in € million)

                                                                                                          Asia Pacific                                         Systems

                                           Americas                         €13,058m                                         €8,080m

14%

Rolling stock

                                                                                                                                            Europe                                  €41,398m 

                                                                                                                                             €57,17 m                                        44%

60%

H1 2024/25 Sales by region and product line

Sales breakdown by region (in € million)    Sales breakdown by product line (in € million)

               Asia Pacific €1,312m                                                                                          9%

Signaling €1,247m

14% Europe

Americas €1,813m€4,911m

21%56%

Rolling stock  €4,531m Services €2,197m

52%25%

Africa, Middle East &

Central Asia €739m

8%

Systems €800m

Sales by currency

Bombardier Transportation PPA provisional amortisation plan

● The Gross PPA amortisation plan will be subject to FX evolution in future years or subject to potential impairments

1. Excludes PPA other than related to the purchase of Bombardier Transportation

Bridge consideration – From Enterprise Value to Equity Value

(1) Long-term and short-term debt and Leases (Note 20), excluding the lease to a London metro operator for €87m due to matching financial asset (Notes 14 and 20 in the Financial Notes)

(2) As per Note 22 (in the Financial Notes) net of  €63m of deferred tax allocated to accruals for employees benefit costs (3) As per balance sheet

(4) As per balance sheet, adjusted with the deposit for the NMTC loan for €26m (Note 20 in the Financial Notes)

(5) As per balance sheet – excluding assets related to pensions for €341m, long term contract receivables for €114m and the deposit for the NMTC loan for €26m

(6) Deferred Tax asset and Liabilities - as per balance sheet net of €63m of deferred tax allocated to accruals for employees benefit costs (7) JVs - to the extent they are not included in equity pickup / FCF, ie excluding Chinese JVs.

(8) Non-consolidated investments as per balance sheet

Reconciliation between consolidated income statement and the MD&A management view as of 30 September 2024

Adjustments as of 30 September 2024:

1.           Impact of business combinations: amortisation of assets exclusively valued when determining the PPA, including net income of equity accounted investments, and including corresponding tax effect;

2.           Reclassification of share in net income of the equityaccounted investments when these are considered to be part of operating activities of the Group

Reconciliation between consolidated income statement and the MD&A management view as of 30 September 2023

Adjustments as of 30 September 2023:

1.           Impact of business combinations: amortisation of assets exclusively valued when determining the PPA, including net income of equity accounted investments, and including corresponding tax effect;

2.           Reclassification of share in net income of the equityaccounted investments when these are considered to be part of operating activities of the Group

definitions (1/3)

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 using forward currency sales. Orders are then measured using the spot rate at inception of hedging instruments.

             •   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 Gross Margin before PPA

Adjusted Gross Margin before PPA is a KPI that presents the level of recurring operational performance. It represents the sales minus the cost of sales, adjusted to exclude the impact of amortisation of assets exclusively valued when determining the PPA in the context of business combination as well as significant, non-recurring “one off” items that are not expected to occur again in subsequent years

             •   Adjusted EBIT

Adjusted EBIT (“aEBIT”) is 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.

Starting September 2019, Alstom has opted for the inclusion of the share in net income of the equity-accounted investments into the aEBIT when these are considered to be part of the operating activities of the Group (because there are significant operational flows and/or common project execution with these entities). This mainly includes Chinese joint ventures, namely CASCO joint venture for Alstom as well as, following the integration of Bombardier Transportation, Alstom Sifang (Qingdao) Transportation Ltd., Jiangsu Alstom NUG Propulsion System Co. Ltd aEBIT corresponds to Earning Before Interests and Tax adjusted for the following elements:

•  net restructuring expenses (including rationalisation 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 realise 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 expressed as a percentage of sales.

© ALSTOM SA 2024. All rights reserved. Information contained in this document is indicative only. No representation or warranty is given or should be relied on that it is complete provided without liability and is subject to change without notice. Reproduction, use, alter or disclosure to third parties, without express written authorisation, is strictly prohibited.

definitions (2/3)

● EBIT before PPA

Following the Bombardier Transportation acquisition and with effect from the fiscal year 2021/22 condensed consolidated financial statements, Alstom decided to introduce the “EBIT before PPA” indicator aimed at restating its Earnings Before Interest and Taxes (“EBIT”) to exclude the impact of amortisation of assets exclusively valued when determining the purchase price allocations (“PPA”) in the context of business combination. This indicator is also aligned with market practice.

● Adjusted net profit

The “Adjusted Net Profit” indicator aims at restating the Alstom’s net profit from continued operations (Group share) to exclude the impact of amortisation & impairment of assets exclusively valued when determining the purchase price allocations (“PPA”) in the context of business combination, net of the corresponding tax effect.

● 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. Free Cash Flow does not include any 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, marketable securities and other current financial asset, less borrowings

● Organic basis

This presentation includes performance indicators presented on an actual basis and on an 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.

© ALSTOM SA 2024. All rights reserved. Information contained in this document is indicative only. No representation or warranty is given or should be relied on that it is complete provided without liability and is subject to change without notice. Reproduction, use, alter or disclosure to third parties, without express written authorisation, is strictly prohibited.

definitions (3/3)

● Gross margin % on backlog

Gross Margin % on backlog is a KPI that presents the expected performance level of firm contracts in backlog. It represents the difference between the sales not yet recognized and the cost of sales not yet incurred from the contracts in backlog. This % is an average of the portfolio of contracts in backlog and is meaningful to project mid- and long-term profitability.

●       EBITDA + JV dividends

EBITDA before PPA plus dividends from joint ventures is the EBIT before PPA, before depreciation and amortisation, with the addition of the dividends received from joint ventures.

●       Funds from Operations

Funds from Operations “FFO” in the EBIT to FCF statement refers to the Free Cash Flow generated by Operations, less Working Capital variations.

● Contract and Trade Working Capital

Contract Working Capital is the sum of:

• Contract Assets & Liabilities, which includes the Customer Down-Payments

• Current provisions, which includes Risks on contracts and Warranties

Trade Working Capital is the Working Capital that is not strictly related to contract. It includes all the elements of the working capital but

• Contract Working Capital

• Income Tax receivables and payables

• Restructuring provisions

.

© ALSTOM SA 2024. All rights reserved. Information contained in this document is indicative only. No representation or warranty is given or should be relied on that it is complete provided without liability and is subject to change without notice. Reproduction, use, alter or disclosure to third parties, without express written authorisation, is strictly prohibited.

Non-linear aEBIT margin trajectory with impact of restructuring plan kicking in during second half of FY 2024/25

© ALSTOM SA 2024. All rights reserved. Information contained in this document is indicative only. No representation or warranty is given or should be relied on that it is complete provided without liability and is subject to change without notice. Reproduction, use, alter or disclosure to third parties, without express written authorisation, is strictly prohibited.

Graph not at scale, for illustration purposes

© ALSTOM SA 2024. All rights reserved. Information contained in this document is indicative only. No representation or warranty is given or should be relied on that it is complete provided without liability and is subject to change without notice. Reproduction, use, alter or disclosure to third parties, without express written authorisation, is strictly prohibited.

Guidance for FY 2024/25 and mid-term ambitions

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