UNIVERSAL REGISTRATION DOCUMENT 2020/21 Including the Annual Financial Report CONTENTS
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UNIVERSAL REGISTRATION DOCUMENT 2020/21 including the annual financial report CONTENTS DESCRIPTION OF GROUP CORPORATE 1 ACTIVITIES AFR 3 5 GOVERNANCE 183 Industry characteristics 4 Report of the Board of Directors Competitive position 8 on corporate governance AFR 184 Acquisition and integration of Bombardier Transportation 9 Leadership Team 238 Value creation model 10 Officer and employee shareholding AFR 240 Strategy 12 Statutory Auditors’ special report on related Integration of Bombardier Transportation 13 party agreements 249 Mid-term financial trajectory and objectives 14 Statutory Auditors AFR 251 Other strategic acquisitions and partnerships 14 Industrial footprint 14 Offering 15 Research and development 25 SUSTAINABLE 6 DEVELOPMENT: CORPORATE SOCIAL RESPONSIBILITY AFR 253 MANAGEMENT REPORT Extra-Financial Performance Declaration 254 2 ON CONSOLIDATED Report by one of the Statutory Auditors, appointed as an independent third party, FINANCIAL STATEMENTS on the non-financial information statement AS OF 31 MARCH 2021 AFR 29 included in the management report 313 Additional information for stakeholders 315 Main events of year ended 31 March 2021 30 Synthesis of indicators/Key figures 2020/21 327 Commercial performance 33 Orders backlog 35 Income statement 35 Free cash-flow 38 Net cash/(debt) 39 ADDITIONAL Equity 39 7 INFORMATION 335 Subsequent events 39 Non-GAAP financial indicators definitions 39 Information on the Group and the parent company AFR 336 Information on the share capital AFR 342 Simplified organisation chart of the Group as of 31 March 2021 360 FINANCIAL Information on the Universal Registration Document AFR 362 3 STATEMENTS AFR 45 Consolidated financial statements 46 Annual financial report reconciliation table 363 Unaudited Pro Forma Condensed Combined Table of reconciliation – Management report 364 Financial Information 127 Table of reconciliation – Headings of annex I Statutory Financial Statements 135 and annex II of delegated regulation (EU) 2019/980 Other Financial Information relating to Alstom SA 152 of 14 March 2019 368 4 RISK FACTORS, INTERNAL CONTROL AND RISK AFR AFR MANAGEMENT 155 The Content of the Annual Financial Report Risk factors 157 is identified in the summary table with the Risk management and control environment 175 help of this pictogram. UNIVERSAL REGISTRATION DOCUMENT 2020/21 INCLUDING THE ANNUAL FINANCIAL REPORT Société anonyme with share capital €2,603,304,935. 48, rue Albert Dhalenne – 93400 Saint-Ouen-sur-Seine (France) RCS : 389 058 447 Bobigny This Universal Registration Document has been filed on July 6, 2021 with the AMF, as competent authority under Regulation (EU) 2017/1129, without prior approval pursuant to Article 9 of the said regulation. The Universal Registration Document may be used for the purposes of an offer to the public of securities or admission of securities to trading on a regulated market if completed by a securities note and, if applicable, a summary and any amendments to the Universal Registration Document. The whole is approved by the AMF in accordance with Regulation (EU) 2017/1129. The English language version of this document is a free translation of the original, which was prepared in French. In all matters of interpretation, views or opinions expressed in the original language version of the document in French take precedence over the translation. It is available on the website of Alstom. DESCRIPTION 1 OF GROUP ACTIVITIES S INDUSTRY CHARACTERISTICS AFR 4 Market drivers 4 Market perspective 7 S COMPETITIVE POSITION AFR 8 S ACQUISITION AND INTEGRATION OF BOMBARDIER TRANSPORTATION 9 S VALUE CREATION MODEL 10 S STRATEGY AFR 12 1. Growth by offering greater value to customers 12 2. Innovation by Pioneering Smarter and Greener Mobility for All 12 3. Efficiency at scale, Powered by Digital 12 4. One Alstom Team Agile, Inclusive and Responsible 13 S INTEGRATION OF BOMBARDIER TRANSPORTATION 13 S MID-TERM FINANCIAL TRAJECTORY AND OBJECTIVES 14 S OTHER STRATEGIC ACQUISITIONS AND PARTNERSHIPS 14 S INDUSTRIAL FOOTPRINT 14 S OFFERING AFR 16 Rolling stock and components 16 Infrastructure & Telecom 19 Turnkey 19 Signalling 20 S RESEARCH AND DEVELOPMENT AFR 25 Development of the range 25 Autonomous mobility 26 Innovation 27 AFR The Content of the Annual Financial Report is identified in the summary table with the help of this pictogram. Universal Registration Document 2020/21 ALSTOM 3 DESCRIPTION OF GROUP ACTIVITIES 1 Industry characteristics Alstom, leading the way to greener and smarter mobility, worldwide At Alstom, we partner with our stakeholders to optimise transport networks by understanding what moves people, listening to their needs and aspirations. We strive to lead the way to smarter and more sustainable mobility. Alstom offers a complete range of mobility solutions, from high-speed trains, metros, monorail and trams to integrated systems, customised services, infrastructure, signalling and digital solutions. Our ‘Alstom in Motion’ strategy, presented in June 2019, focuses on sustained growth, green and digital innovation, and operational efficiency, in an agile, inclusive and responsible corporate culture – as One Alstom Team. With the acquisition of Bombardier Transportation on 29 January 2021, Alstom enhances its product portfolio and global footprint to better serve customer requirements worldwide. Alstom keeps leveraging on its strategy, its strong operational and financial performance to strengthen its leadership in the growing transportation market. S Industry characteristics MARKET DRIVERS The rail transportation market is supported by solid long-term drivers. In this context, efficient, green, inclusive and intermodal urban Soaring urbanisation, economic growth and public & private investment in transportation systems as rail transportation offers ideal mobility infrastructure create a growing demand for transport notably in emerging solutions in term of capacity, punctuality, security, and reduction of countries. Mature markets, on the other hand, are mainly supported by noise, pollution and energy consumption. projects aiming at updating and modernising existing infrastructure and rolling stock enhanced by growing environmental concerns. Sustainable development Today more than 90% of the world population lives in areas where air Urbanisation pollution exceeds the threshold recommended by the World Health (4) The combination of both economic and demographic growth entices a Organisation while CO2 emissions from transport continue to grow. growing number of people to live in cities. By 2050, world population Transportation, which represents approximately 24%(5) of greenhouse gas should exceed 9.7 billion inhabitants(1) of which nearly 70% will reside emissions from energy combustion (for standard pre-Covid-19 levels), is in urban areas(2). This trend towards urbanisation is particularly strong clearly recognised overall as a sector which contributes significantly to in China, India and in many countries of Africa and Latin America. worldwide emissions whilst offering a great potential to curb them. The This development triggers the growing saturation of airports, roads and increased visibility of climate change consequences and the threat that existing railways and the need for new infrastructure. In this situation, air pollution poses on public health drives the actions of governments, railways typically offer a mass transit solution, safe, reliable and clean. cities and regulation bodies but also of transport operators and citizens to limit the magnitude of impacts by reducing greenhouse gas and Additionally, in many cities, the population is encouraged to leave behind airborne emissions. For instance: individual methods of transportation and favour collective transportation y The European Commission presented in December 2020 to limit traffic congestion. This change is usually supported by the active its ‘Sustainable and Smart Mobility Strategy’ which lays the foundation promotion of public transportation. for how the EU transport system can achieve its green and digital While the impact of the sanitary crisis on urbanization remains to be transformation and become more resilient to future crises. As outlined assessed, many people responsible for urban planning and development in the European Green Deal, the result will be a 90% cut in emissions consider that sustainable urbanization and infrastructure are critical to by 2050, delivered by a smart, competitive, safe, accessible and Covid-19 recovery and even more looking for sustainable urbanization affordable transport system. and infrastructure. “The World Cities Report 2020 convincingly affirms y Many countries already announced a halt to sales of new cars equipped that well-planned, managed, and financed cities and towns create with combustion engines e.g. Norway (2025), Sweden (2030), economic, social, environmental and other unquantifiable value that can Germany (2030), Denmark (2030), France (2040), United Kingdom vastly improve the quality of life of all”, said Maimunah Mohd Sharif, (2040) or Spain (2040) in Europe, but also other countries like India the UN-Habitat Executive Director (3). (2030), Taiwan (2040) or Egypt (2040). Cities and provinces are also taking up the challenge and planning a ban of diesel or fossil-fuel vehicles at local level (e.g. Madrid, Paris, Amsterdam, Athens, Mexico, Munich, or regions like California, or Quebec). (1) UN World population prospects – 2019. (2) UN World urbanization prospects – the 2018 revision. (3) https://news.un.org/en/story/2020/10/1076532.