PARIS (Reuters) - Alstom (ALSO.PA), which is selling its power equipment business to General Electric Co (GE.N), posted first-quarter sales and order intake in its remaining transport segment that beat expectations and confirmed its medium-term growth target.
The French company said orders fell to 2 billion euros ($2.17 billion) from 4.8 billion in a year-earlier period that benefited from a 4 billion contract in South Africa. Sales rose 8 percent to 1.6 billion, it said on Monday.
Orders were 23 percent ahead of market consensus, while revenue was 2 percent ahead, UBS analysts said.
“Transport is one of few healthy end markets today, as evident by the order momentum today,” the analysts wrote, adding that the stock price was still dominated by the success or failure of the GE transaction.
Alstom Chief Executive Patrick Kron said “the project with General Electric is moving ahead”, with the process for competition and regulatory authorizations ongoing.
“We are actively working to complete it,” he said in a statement. “After closing, we plan to call a shareholders’ meeting to vote on the amount of cash proceeds to be distributed to shareholders.”
Alstom confirmed that it expects sales to grow at over 5 percent a year organically in the medium term and that its operating margin should gradually improve within the 5 percent to 7 percent range.
Reporting by James Regan and Alexandre Boksenbaum-Granier; Editing by Christopher Cushing and Andrew Callus