France's Alstom tops market estimates on first-quarter sales

By Anna Peverieri

(Reuters) -French train maker Alstom on Wednesday reported slightly higher-than-expected sales for its first quarter, driven by the ramp-up of projects in Germany and continued execution of undertakings in France, the U.S. and Italy.

Alstom's shares rose 2.3% by 0730 GMT.

Alstom, which makes trains and signalling systems for urban and regional rail networks, recorded sales of 4.51 billion euros ($5.3 billion), up 7.2% on an organic basis, while analysts had anticipated sales of 4.4 billion euros and organic growth of 5.3%, according to a Visible Alpha consensus.

Tariffs' impact on the group's financials was "minimal" in the quarter, CFO Bernard Delpit said during an analyst call, noting that this was partly due to "constructive discussions with customers" that helped offset cost pressures.

He added the company expects to continue mitigating the effects of U.S. tariffs over the rest of the fiscal year, thanks to contractual provisions such as changing law clauses.

Alstom, which has struggled to recover from its costly 2021 acquisition of Canadian firm Bombardier's rail business, reported first-quarter orders of 4.1 billion euros, in line with a Visible Alpha consensus.

CEO Poupart-Lafarge said in a statement the group had "a strong view on the pipeline for the second quarter," adding that it is expected to be "bolstered by momentum in North America".

The French train maker, which is currently looking for a new CEO, has booked several major contracts this quarter, including a 1.7 billion euro deal in France and a 600 million euro one in Bulgaria, which boosted its orders in the quarter.

Alstom confirmed its full fiscal year 2025-2026 targets.

ALSTOM EYES GERMANY'S RAIL INVESTMENT PLAN

Alstom is monitoring Germany's plans on rail infrastructure with at least 10 billion euros expected to be allocated to signalling over five years, the CFO said.

He added Alstom has sufficient capacity to manage any ramp-up, and projects updates will follow once Berlin's budget is finalised.

Germany is addressing its investment backlog with a 500 billion euros infrastructure fund. The 2025 draft budget is expected to be finalised in September, while the 2026 draft will be presented on July 30.

($1 = 0.8521 euros)

(Reporting by Anna Peverieri; Editing by Vijay Kishore and Milla Nissi-Prussak)