Train maker Alstom’s sales gain steam as orders beat estimates

By Olivier Sorgho

(Reuters) -French train maker Alstom (EPA:) posted an 8% rise in third-quarter sales on Wednesday, helped by forecast-beating orders, particularly in Europe.

While Alstom’s costs have increased due to supply-chain issues, the war in Ukraine and its acquisition of Bombardier (OTC:)’s rail business, its sales have gained from a ramp-up in orders as train ridership improves with the easing of COVID-19 restrictions.

“I do not see any sign … of a slowdown on our demand globally,” finance chief Laurent Martinez told analysts in a call, adding that ridership was back to pre-COVID levels.

Revenue in the October-December period, Alstom’s fiscal third quarter, amounted to 4.22 billion euros ($4.60 billion), compared with 3.92 billion euros in the same period a year earlier.

Quarterly orders, of which most came from Europe, increased by 13% to 5.15 billion euros, and were 11% ahead of a consensus cited by J.P.Morgan.

Alstom’s orders “highlight high level of activity in rail industry which is already visible in large order announcements of companies”, J.P.Morgan analyst Akash Gupta said in a note to clients.

Gupta added he expected Alstom’s Swiss peer Stadler to also report good quarterly orders.

The company confirmed its full-year outlook and mid-term objectives to fiscal 2024/2025.

“The confirmation of guidance, while in-line with expectations, should be seen as re-assuring,” Citi analysts wrote in a note.

Alstom’s shares were up 1.12% at 0907 GMT.

($1 = 0.9172 euros)