Bombardier integration continues, AG guidance and reports

At the shareholders’ reception at Alstom’s annual general meeting held in Paris near the Champs-Élysées, Investir collected 140 mandates for 36,841 shares (plus 9 mandates for 1,488 shares only in case of unexpected decisions on the agenda).

The session was opened by Director General Henri Poupard-Lafarge. The operators are Caisse des dépôts du Québec (65.4 million shares) and Amundi (13.8 million). The previous quorum is 68% of the capital. A bailiff is present in the room.

Henri Poupard-Lagarge takes the floor. He says rail is the most sustainable form of transport in terms of energy consumption, safety and land use. The market is well oriented in urbanization, for example in India, where few cities have subways. The share of the rolling stock market is 38%, excluding China. This activity provides 56% of turnover. The balance comes from services related to the installed base, alarms and turnkey systems. The order book reached a record 81 billion euros after 19.3 billion orders in the fiscal year that ended at the end of March. It is about replacing the trains that are still working with diesel, with hybrids, with batteries, with hydrogen. Experiments are underway to develop autonomous trains, as has already been done for the subway, to make traffic smoother. The automation of production sites is also progressing. A major program is also underway to develop a system that will allow engineers around the world to access all the data available in the materials group.

The executive also explains the targets for reducing production-related CO2 emissions (230 kilotonnes), but above all emissions during the lifetime of the trains (32,000). This includes, for example, braking energy recovery.

Bombardier integration

Henri Poupard-Lafarge also talks about Bombardier’s very intensive and successful first year of integration, when €102 million of synergies were realized. He recalls saying at the time of the acquisition that it would take 3-4 years for the figures to converge to those of the group. IT systems and products need convergence. As for inflation, it is specified that two-thirds of the order portfolio is indexed.

CFO Laurent Martinez has the floor. The net loss of 576 million euros includes 404 million depreciation of 20% of the shares of Russian TMH. The stable dividend of €0.25 corresponds to a payout rate of 35% of adjusted net profit before this impairment. He will be released on July 20, and the salary will be paid on August 26.

Mandatory preservation of free shares

Yann Delabriere, Lead Independent Director, is now on the microphone. Regarding the remuneration of the chief, clause of Art compensate, return which allows for the withdrawal of the annual bonus and shares that have not yet been finally purchased within two years if the goals deemed to have been achieved are called into question. In addition, 100% of the allocated but not yet fully vested shares, instead of 50%, must be retained during the term of office. The fixed remuneration of the executive director is EUR 950,000, the bonus is capped at 170%. It was 119.9% ​​for 2021/2022 and 20,482 shares were placed.

Let’s move on to the questions. In response to questions from Investir, Henri Poupard-Lafarge says that the contracts inherited from Bombardier have a zero gross margin ” the turnover will be slightly more than 2.5 billion euros per year for two to three years. As for the increase in the requirement for working capital, it is connected with “ investments to stabilize Bombardier projects. The situation should gradually normalize, especially since provisions will be used up. The answer to the risk of capital increase: ” the balance is solid and nothing needs to be done “. This wording seemed to us somewhat more decisive than during the meeting with investors on May 11.

Questions about TMH in Russia. 20% is not ” not for sale “. The investment was made in 2007 during the planned opening of the Russian market for Western technologies, but this did not happen.

Let’s go to vote. Dividends were approved, as well as an option to reinvest in shares for 21.13 euros. The CEO’s salary gets 91.58% of votes. The issue of shares without PSR, including for a limited circle of investors, received 88.52% of votes.