PARIS-- Alstom SA on Wednesday said orders doubled in the first
quarter, boosted by its largest-ever train contract in South
Africa, though orders for power equipment, the company's largest
business line, fell during the period.
The French maker of signature TGV bullet trains said it booked
orders worth EUR8.20 billion ($11.07 billion) during the
three-month period through June, though sales fell 4% to EUR4.34
billion during the period. The orders included a EUR4 billion order
for 600 trains in South Africa.
Bank of America-Merrill Lynch expected orders worth EUR7.45
billion and sales of EUR4.61 billion.
Orders for thermal-power equipment, which accounts for most of
the company's revenue, fell 3% to EUR1.50 billion. Sales of thermal
power equipment fell 10% in the quarter to EUR1.68 billion, as a
result of falling demand for new power plants, Alstom said, adding
that it will count on its train business for growth in the coming
months.
"While the level of organic growth achieved in transport in the
first quarter should not be extrapolated over the remainder of the
year, sales should grow at a sustained pace this year benefiting
notably from the execution of its record backlog," the company said
in a statement.
Alstom didn't provide any guidance for the remainder of its
fiscal year.
The weaker power business pushed Alstom's management to seek
alternatives by selling the unit to its larger competitor General
Electric Co. earlier this year. The possibility that a major French
company could be taken over by a U.S. rival has generated backlash
from some French politicians. Economy Minister Arnaud Montebourg
initially opposed the sale to GE and called German rival Siemens AG
to file a rival bid.
He eventually brokered a partial sale of the unit to GE and the
creation of three 50-50 joint ventures between Alstom and GE in
power equipment.
The government also made the decision to buy a 20% stake in
Alstom from its main shareholder, French family-controlled
conglomerate Bouygues SA.
Alstom will call for a general shareholder meeting to approve
the deal before the end of 2014, the company said.
Write to Inti Landauro at inti.landauro@wsj.com
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