Alstom reviews upwards its medium-term forecasts following
an excellent fiscal year 2007/08

Key figures 

Fiscal year 2007/08 was marked by a record
level of orders in both our Power and Transport
activities, highlighting our good positioning in the
growing infrastructure markets. The strong increase in
sales, the substantial improvement of our performance and
the high cash generation illustrate once again the
success of our profitable growth strategy. The sharp rise
in net result allows us to propose to our shareholders to
double the dividend. The level and quality of the
backlog, combined with a continuous focus on project
execution, give us confidence to review upwards our
operating margin estimate for March 2010 to around 9%. To
support this positive trend, the Group will continue the
recruitment of the talents it needs, its effort in
research and development to stay ahead in innovation and
its investments to selectively increase its
capacity, said Patrick Kron, Alstoms
Chairman and Chief Executive Officer.

Strong commercial activity in all
Sectors
During fiscal year 2007/08, the Group booked 23.5
billion of new orders, a 23% increase from the high level
of the previous fiscal year, bringing its backlog to
39.2 billion (+21%), which represents 28 months of
sales. All Sectors contributed to this growth in order
intake: +21% in Power Systems, +8% in Power Service and
+39% in Transport.

Leveraging its strategic strengths, the Group fully
benefited from strong demand in power and transport
markets. Power Systems booked a record 38 gas turbines,
18 of which were GT26, mainly in Europe and the Middle
East/Africa, as well as a major contract for steam
turbines and generators in a coal power plant in South
Africa. The Sector also received an order for four
conventional islands in Chinese nuclear power plants, as
well as several hydro projects in Brazil, China, Vietnam
and Uganda. Power Service signed 10 operation and
maintenance contracts, mainly related to gas-fired power
plants, and registered a large number of small and medium
sized orders, notably in Europe and the USA. Transport
achieved a very high level of order intake including a
major contract for very high speed trains in France,
Pendolino high speed trains for the Helsinki-St
Petersburg line, metros in New York and in a number of
other cities, tramways in Dublin and Rotterdam, regional
and suburban trains in Spain, Australia and Germany, a
signalling system in Belgium and a maintenance contract
in the UK.

On the back of the growing backlog, sales reached
16.9 billion in fiscal year 2007/08 compared to

14.2 billion for fiscal year 2006/07, representing
a 19% increase (in both actual and organic terms). Sales
grew in all Sectors: +37% in Power Systems, +13% in Power
Service and +4% in Transport .

Supporting organic growth
To execute the large backlog, the Group put strong
emphasis on human resources management, notably through
the recruitment and integration of 10,500 new employees
in 2007/08.

To optimise the industrial base, capital expenditure
increased by 34% in 2007/08, amounting to 374
million. These investments notably include capacity
increases in a foundry in Poland and in hydro activities
in China as well as the start of the construction of a
new factory to manufacture turbines in the USA.

Simultaneously, the Group continued its efforts in
research and development with expenses increasing by 21%
in 2007/08. Strategic programmes have shown significant
progress: the new generation of very high speed trains
(AGV) was unveiled at La Rochelle (France) on 5 February
2008; and the programme on CO2 capture solutions using
post-combustion and oxy-combustion technologies was
intensified, notably through new pilots.

During 2007/08, the Group finalised a number of
acquisitions (Wuhan Boiler Co. in China, Ecotècnia
in Spain) and partnerships (with Atomenergomash in Russia
to build conventional islands for nuclear power plants,
Balfour Beatty to serve the UK and Irish signalling
markets and RENFE in Spain in the field of train
maintenance).

Sharp rise in profitability
In fiscal year 2007/08, income from operations amounted
to 1,295 million, up 35% from 957 million
in the previous year and operating margin improved from
6.7% to 7.7%. The operating margin of Power Systems grew
from 3.5% to 5.3%, driven by the better quality of its
backlog along with a constant focus on project execution
and cost control. Power Service increased its operating
margin from 15.9% to 16.4% in combination with a
double-digit top line growth. In Transport the operating
margin increased from 6.6% to 7.2%, as a result of high
selectivity in orders taken over the recent years, better
project management and cost reductions related to its
platforming strategy.

Net profit increased by 56%, amounting to 852
million compared to 547 million in fiscal year
2006/07. This increase resulted mainly from improved
operational performance and lower restructuring and
financial charges.

Record level of free cash flow
Free cash flow amounted to 1,635 million for
fiscal year 2007/08 compared to 745 million in
fiscal year 2006/07. This strong cash flow generation was
achieved through a combination of better profitability, a
further significant improvement of the working capital,
partly related to the high level of order intake, as well
as a decrease in restructuring cash outflow and financial
expenses.

Thanks to this very high free cash flow, the Group turned
cash positive during fiscal year 2007/08, from a net debt
of 64 million on 31 March 2007, to a net cash of
904 million on 31 March 2008, after payments
related to acquisitions and the dividend distributed in
July 2007.

The solid financial structure of the Group on 31 March
2008 and its leading positions in both power and
transport markets, allowed it to obtain an investment
grade rating of BBB+ and Baa1 to be published
respectively by Standard & Poor's and Moody's.

Dividend policy and split

The Board of Directors has decided to propose to double
the dividend to 1.6 per share and to split the
shares by two at the next Annual General Meeting which is
to be held on 24 June 2008. If approved, the dividend
will be distributed on 1 July 2008 and the split launched
on 7 July 2008.

Outlook
Alstom will continue to select the most profitable orders
to further improve the quality of its backlog. It will
also focus on the execution of its contracts by
strengthening project management throughout the Group,
continuously develop its human resources and optimise its
industrial footprint.

Given the strong and healthy backlog, the operating
margin of the Group in March 2010 should exceed the
previous forecast and reach around 9%, with an operating
margin for the combined Power Sectors between 10% and 11%
and for the Transport Sector between 7% and 8%. Based on
current market conditions and trends, the operating
margin should further increase beyond March 2010.

Lactivité du Groupe ainsi que les
comptes consolidés sont disponibles sur le site
internet dAlstom :
www.alstom.com

Press ContactPhilippe Kasse, Stéphane Farhi (Corporate)Tel:
+33 1 41 49 29 82 / 33 08

philippe.kasse@chq.alstom.com

stephane.farhi@chq.alstom.com

Investor Relations  

Emmanuelle ChâtelainTel: + 33 1 41 49 37 38

emmanuelle.chatelain@chq.alstom.com

¹ Restated following a change in accounting for
pensions

² Same scope (retreatment of disposals and
acquisitions) and exchange rate

This press release contains
forward-looking statements which are based on current plans
and forecasts of ALSTOMs management. Such
forward-looking statements are by their nature subject to a
number of important risk and uncertainty factors (such as
those described in the documents filed by ALSTOM with the
French AMF) that could cause actual results to differ from
the plans, objectives and expectations expressed in such
forward-looking statements. These such forward-looking
statements speak only as of the date on which they are
made, and ALSTOM undertakes no obligation to update or
revise any of them, whether as a result of new information,
future events or otherwise