Alstom SA (ALO) Earnings Call Transcript & Summary

Good afternoon, ladies and gentlemen. Dear shareholders, I declare open this session of the combined shareholders meeting of Alstom. First of all, I would like to thank the shareholders attending the meeting as well as shareholders who did connect remotely to attend this shareholders' meeting. I have the honor to preside. Attending today on stage, Mr. Martin Sion, the new CEO of your company. He will introduce himself in the moment. Madam Emmanuelle Petrovic, General Counsel; and Mr. Bernard-Pierre Delpit, Chief Financial Officer. I would like also to welcome here in the first road members of our Board of Directors. In accordance with the law, it is now my responsibility to appoint the presiding officers. I call upon the 2 members of the meeting, you represent the larger number of votes, and you have agreed to take on this role as [indiscernible] Quebec as scrutinies [indiscernible] Quebec share [ 80,937,484 ] shares represented by Mrs. Kim Thomassin. And BPI [indiscernible], which holds [ 34,937,254 ] shares represented by Mr. Samuel Dennis in the second row. I would like now with the agreement of the scrutineers, to appoint Madam Emmanuelle Petrovic as Secretary of the shareholders' meeting presentative from [indiscernible] and PricewaterhouseCoopers Audits. Statutory auditors for Alstom are also attending this meeting, and I would like to thank them indeed for being here with us. I shall now hand over to Mrs. Emmanuelle Petrovic.

Thank you, sir. The year ended and the resolution put to the vote of this combined shareholders meeting are set out in the Notice of Meeting, which is available online on our website and that has been to registered shareholders. The agenda and these resolutions are also set out in the notice of meeting published in the [indiscernible] on June 1, 2026. The Board of Directors' report on the resolutions is included in this [indiscernible] of meeting. The statutory auditors reports have also been made available to you and are included in the notice of meeting. To avoid unnecessarily prolonging the meeting, I will not be reading at the agenda in these reports. The [indiscernible] on the table contains the documents required by law, a list of which will be recorded in the minutes of this meeting. All of the documents have been made available to shareholders at the company's registered office. Having clarified these points, I would like to inform you about the following: our Chief Executive Officer, Mr. Martin Sion will present a review of the financial year and provide an update of the group's outlook, Mr. Bernard-Pierre Delpit, Chief Financial Officer, comment on the group's financial results for this financial year. Then Mr. Kevin Cogo, Head of group strategy will outline the group's CSR priority and achievements. Corporate governance and remuneration matters will then be presented by Mr. Philippe Petitcolin, Chairman of the Board of Directors. And Mr. [indiscernible] his capacity as Chairman of the Nomination and Remuneration Committee. Finally, the statutory auditors will present their reports. Following these presentations, there will be the audience during which, you will be available to ask questions whether verbally or in writing using the form provided to you. We will then conclude with the presentation and vote of resolutions. As usual, to facilitate voting and enable results to be displayed more quickly and electronic verdict system will be used about entering the room, you were given an electronic voting device, which I would I would like to ask you to keep at hand and not if we get to return them to the hostesses on the way out. I would like to point out that the attendance register is currently being checked and that will be -- and we will be welcoming shareholders up until 3:00 p.m. As a deregulate for shares carrying at least 1 voting rights, your company's share capital comprises [ 462,616,024 ] shares. According to the provisional attendance registered shareholders represent an passion or by proxy hold [ 303,348,000 ] votes 30% carrying voting [indiscernible]. The forum required for this general assembly, which will be held [indiscernible] 20% for the ordinary part and 25% for the extraordinary part. The 25% quorum has therefore been already achieved and the meeting will be able to deliberate. I'd like to remind you that this meeting is being felt and broadcast live on the company's website. I would also like to inform you that a Judicial officer is in this room. Thank you for your attention. Now I hand over back to the Chairman. Thank you. Madam Secretary, I will now hand over to Mr. Martin Sion, Chief Executive Officer.

Ladies and gentlemen, dear shareholders, it is with great honor, but also a strong sense of responsibility that addressed you today for the first time as Chief Executive Officer of Alstom. I joined the Alstom Group on April 1 after 36 years working at Safran, the Aerospace & Defense Industries. Let me say a few words about my career. I began my career in technical and engineering role. Before moving into transformation and continuous improvement, I held industrial management rules then manage 3 companies with [indiscernible], Electronics and Defense, some of you have known in a session. And finally, Arian Group, which is a joint venture between [indiscernible]. So what is the link between rocket engines, aircraft engines, electronic equipment and launches and the railway sector. Well, in reality, there are many. Looking at each of these fields, we are always talking about high-level engineering, technology, complex systems reliability, industrial performance. and rigor and execution. The environment is different. The size of the company is different. But as soon as you look at the details, you understand that skills involved are very similar. So this experience of major industrial projects I want to bring to Austin. Since my arrival, I have been keen to get out into the field as quickly as possible. I visited about 20 sites during the first 3 months. I did not mean to observe as them from a disti but rather to ground my assessment in the company's industrial reality, that is a meeting with teams, partners and customers alike. This initial visits have confirmed a very strong conviction of mine. Alstom has considerable strength, technologies, products, a global footprint, a leading backlog as you well know, but it's also women and men who demonstrate remarkable commitment and expertise. Still, these assets must now be reflected more clearly in our performance. We need more regularity in execution, more consistency, a greater discipline in steering our projects, more predictability in our deliveries and more simplicity in the way we operate. While this assessment is not based solely on figures. It also stems from what I have seen, what I have heard and the discussions that I've had with our teams, customers and partners. Recent financial results show that we are not yet performing at the expected level for a leader such as Alstom. However, they do not call into question the quality of our fundamentals or the potential of the company. My message is therefore simple. Alstom is not a company that needs to be reinvented. It is a company who's full potential must be realized by raising the bar. And this is precisely what we are about to enter now. I would like now to cover the year 2025, 2026. Starting with the highlights of this year. First of all, it was a record year in commercial terms, nearly 28 billion of turnover of orders. The turnover rose by 3.7% with adjusted for changes of scope and currency effects, the organic growth stood at 7.2%. All business units contributed. Rolling stock services and industrialization, but the adjusted EBIT margin fell short of our expectations down on last year. This is mainly due to the underperformance in rolling stock. This is mainly explained by 2 types of problems. First of all, industrialization and homologation processes and some projects reaching the end of the execution, which started had a difficult start. And then the free cash flow generation stood at EUR 336 million, in line with our target. Let's now turn to the group's commercial performance over the past financial year. Aston recorded EUR 27.6 billion in order intake, which is a record level with an order to turnover ratio of 1.4. This performance is well balanced, both geographically and by business segment. Europe remains the main contributor with EUR 15.6 billion. Among the major contracts, there is EUR 1 billion in Portugal, EUR 1.5 billion in Poland, for our Coradia Max regional platform, including maintenance, EUR 1.4 billion with Eurostar in France and EUR 1.6 billion for [indiscernible] trains in the Paris region. Americas are also seeing ground strong growth with EUR 7.9 billion orders. This is driven by several major successes in North America. First of all, a EUR 2 billion contract for the metro in the New York metropolitan area. EUR 1 billion for the New Jersey commuter rail [indiscernible] and EUR 1.4 billion in Canada for the Toronto Metro. By product line, rolling stock leads the way with EUR 14.3 billion, pretty much half of the order intake. Services follow with EUR 6.5 billion and signaling and systems accounting each for EUR 3.4 billion approximately. Beyond the figures, this performance confirms the group's platform strategy. Horizon, for instance, our high speed train platform is going strong in several markets as shown by the significant proportion of options included in orders, and the backlog now stands at over EUR 104 billion. Now let me talk about key operational achievements. In the United States. Next, [indiscernible] has entered commercial service on abstract Northeast corridor with trains designed and manufactured in the U.S. for the U.S. market. At this stage, more than 10 train sets are already in commercial operation. In India, the new metro lines have been brought into service in [indiscernible] and extensions to the New Delhi network incorporating Alstom's latest signaling technologies. In France and [ F 19 ] has entered service on line 10 of the Paris Metro deployment will continue gradually across 8 metro lines by 2033. And finally, in Australia, we achieved a first for the country with the commissioning of the Melbourne Metro Tunnel. Let me now switch to that part of my presentation to share with you my assessment of the group current situation. Alstom is in the business of industrial projects for this kind of business, the quality of execution and financial performance depend above all on the backlog at size, balance and margin levels. From that point of view, the progress made recently is very important. The backlog has went up over EUR 6 billion over 5 years. It is also better balance across rolling stock, services, signaling and systems. At the same time, the margin embedded in the backlog has improved by approximately 2 percentage points. Several factors explain this development. Well, first of all, the railway market has performed well with approximately EUR 210 billion identified worldwide over the next 3 years. This gives us visibility but it also requires a real discipline in the way we like our projects. Secondly, the combination of rolling stock and services is a unique driver of growth. In practical terms over the last 2 years and 50% of the trains sold was accompanied by a maintenance contract. Finally, Alstom has built a strong position in digital signaling solutions, both in stand-alone projects and an integrated 10 key projects. All of this provides a sound foundation. In an industrial pro-based business, such as Alstom, a strong balance sheet and cost discipline are essential to our success. Progress has been made these last 3 years. The debt reduction plan that was launched in 2024 that strengthened the balance sheet and fixed costs have fallen as a proportion of turnover. Progress has also been made on the environmental front. Scope 3 images, which are linked to passenger trains sold to our customers have fallen by around 20% over 3 years' time. This reflects both the evolution of our products and a growing need and demand for low-carbon mobility solutions. Now also being operational improvements in manufacturing, quality has improved, and the transformation plan has been launched in Germany [indiscernible] to adapt industrial footprint and boost efficiency and competitiveness. This does not solve everything. But these progress clearly show that the actions we have taken are beginning to yield results. This slide shows that there is still room for improvement in terms of execution. You can see the production of car these last 3 years. So every quarter, regarding the rolling stock, we haven't reached yet the expected level of consistency. This has impacted our operational performance and reduced financial visibility, especially during Q4. Regarding production, the first 9 months of the year were kind of stable. However, Q4 showed with a total of nearly 100 cars fewer than planned for the year. Most of this shortfall stems from several major platforms where the development and industrialization phases are overlapping and taking longer than anticipated. It means delays and additional costs. teams remain on task for a longer time. The taking phases are extending. In some cases, some changes have to be made retrospectively. All of this puts pressure on margins and cash generation in the short term, deliveries are not canceled, but postponed over time, consequently, to our cash inflows. At the same time, the group is finalizing a small number of contracts with additional problems were identified during project reviews in Q4. On the next slide, you will see some very tangible short-term actions to stabilize the situation and start turning things around. First of all, we are working a strengthening manages attention on execution. We do insist on operational discipline with faster lean practices implemented for engineering and execution. We also want to strengthen the quick problems feedback coming from the field. Then we want to review rules and the decision rights in the companies to reinforce the empowerment of our project managers. We try to simplify our operating modes. Our teams have more time to dedicate to execution. Third line, we are working towards an even greater control cost. Focusing our resources on the key projects and aligning with delivery requirements. Finally, we are accelerating procurement initiatives in order to capitalize on the size of our backlog when negotiating with our suppliers. All these actions target fundamentals of execution. We will implement them with determination. At the same time, we are preparing for more far-reaching operational changes. And I mean a better alignment of our operations, operating move, industrial footprint and office. This concludes my presentation. I would now hand over to Bernard-Pierre Delpit for the financial review.

Thank you, Martin. I am now going to invite Bernard Delpit, Financial Director to take the floor.

Thank you, Mr. Chairman. Ladies and gentlemen, dear Alstom shareholders, it's an honor for me to present to you the group's consolidated income statements for the financial year ending 31st of March '26, and I'm going to do this by highlighting a number of financial indicators. To start with, with the key elements of resolution #2, which is going to be subjected to your vote. Concerning the consolidating accounts of Alstoms, and you see here on the right-hand side column that the sales figure of your company reached EUR 19,171,000,000 for the last financial year, which represents organic growth. In other words, outside of some currency and scope effects of 7.2%. The operating income of your company reached EUR 1.168 billion, in other words, a fairly stable level compared to last year. This represents an adjusted operating margin of 6.1%, down by 30 basis points compared to the previous financial year, readjusted with currency and scope effects. This operating margin is stable compared to the past year. now issues of execution of some projects for rolling stock have therefore been offset by the correct execution of the rest of the portfolio and the good effective control of our central costs and the strong performance of our joint venture projects in China. Nonoperating expenses continue to fall going from almost EUR 200 million to EUR 155 million last year. These include, in particular, restructuring and streamlining costs to adapt our industrial base as well as legal costs. And this decline reflects the gradual normalization of these expenses following the integration of Bombardier. As a consequence, the operating profit is now at EUR 797 million. In addition to which the financial result is improving significantly with EUR 165 million compared to EUR 214 million last year, [ besetting ] in particular, from the efforts for a debt reduction of the group. Now the tax rate that you see on this line, so effective tax rate is now at 35% of taxable income, which is stable compared to last year. All of these factors leads to an adjusted net profit of EUR 559 million compared to EUR 498 million last year. Finally, after taking into account the amortization of goodwill, as it's called, in particular related to past transactions. Net profit attributable to the group is now at EUR 324 million, a significant improvement on the EUR 149 million of last year. And this is the result that we suggest you approved in the second resolution. I would also like to take this opportunity to mention the company accounts in French law. So for Alstom, which is the parent company of the group Alstom, that you are the direct shareholders of the amount of the general reserve at the end of March '26 stands at approximately EUR 6.7 billion, following allocation of the profits from previous year. And so this year, we suggest to allocate to this general reserve, the results of the year. In other words, in French standards of EUR 100 million. Just like last year, we do not suggest any dividends for the year '25, '26. This decision is in line with the financial policy of the group. In other words, to -- with the objective of favoring the strengthening of the balance sheet and the pursuing efforts for debt reduction. And speaking of debt reduction that net of your company, which was EUR 34 million on the 31st of March '25 is now today at EUR 404 million. This evolution is explained. First of all, with the generation of cash flow, which reached EUR 323 million for this financial year, in line with the forecast that were made in May of '25. In addition to this cash generation, a number of factors have also influenced this change in debt. in particular, the paying of dividends to minority shareholders and the coupon payments on what is called a hybrid debt, which we had issued in May '24 in this plan of debt reduction for the Alstom Group. In addition to which our rent payments amounted to EUR 172 million paid over that period. And finally, exchange rate effects contributed to a reduction by EUR 553 million of debt. All of these flows are favorable for cash generation and unfavorable for the other factors that I just mentioned, explain the fairly moderate evolution of debt reduction and so reaching EUR 404 million. Now concerning the cash flow of the group, the -- so free cash flow and equivalents are now EUR 2.3 billion in March of level, which is overall stable compared to last year, in addition to which the group has revolving credit facilities, a line of EUR 2.5 billion, which was not drawn and a commercial paper program, allowing it to also issue short term for an amount of EUR 2.5 billion. Overall, these elements give the group a situation for cash flow that allows it to meet its operating needs and concerning the profile of the debt that you see on the right here. So the -- so bonds of EUR 700 million are going to be due in October of this year. And this debt maturity was already refinanced with the debt you mentioned in the month of June that I'll come back on shortly. And so the EUR 700 million will be paid back in the month of October. Taking this opportunity as well to tell you about the objectives that were announced for this financial year '26, '27. First of all, we continue to anticipate sustained demand on our markets, in particular, for rolling stock, but also for signaling and services. And in this general situation, we expect business activities to be quite buoyant with a order to turnover ratio exceeding 1. And so an accumulation of order intake above the level of the turnover of the year. This turnover, we expect to have increasing by over 5%, in line with our ambitions, midterm ambitions. In this respect, we estimate that the number of carriages so being either a car, a locomotive or metro carriage. So we estimate that this overall number of carriages produced, so a physical estimation, which represents about 50% of our activity should be in the range of 4,400 to 4,500 units in this financial year, which is a crucial indicator in particular, of the efficiency of our production tool and of the quality of our engineering. Now concerning profitability, we are targeting a gradual improvement of the adjusted operating margin with the objective of 6.5% compared to the 6.1% for the previous financial year that was just closed, which translates the ongoing efforts to enhance operational efficiency and of the product mix. Now in terms of cash generation, we are targeting positive free cash flow for the financial year. And as you know, Alstom has a financial year that starts on the 1st of April. And so in the first half of the year, there's 2 -- so lower months of activity, so the summer months. And so cash flow is strongly affected by the seasonality, and we have, therefore, indicated that we should have a negative cash flow up to minus EUR 1.5 billion during the first half of our financial year. Now a few striking elements for the first quarter '26-'27. First of all, the TTPM obtained so the authorization for commissioning. So in May, with so are a commercial review by the SNCF in the month of September. We now have a commercial start, which is aligned with our expectations on signaling and services. So a little bit lesser for selectivities for rolling stock. And as I indicated previously, at the beginning of June, we issued a hybrid bond as it's called, and so most especially green bond with characteristics connected to efforts for decarbonization conducted by Alstom, which was also met with quite a bit of success with a rate that is considered successful performing -- high performing. And I would not leave you without showing you, as I usually do, the evolution of the share price for this period of time since our last shareholders' meeting compared to the SBF 120 index for the first part of the period, the share price performed overall positively, reflecting, in particular, the strength of the commercial policy of the group with a record order intake and an order book offering strong visibility. We then observe a period of increased volatility, which is explained, first of all, by the market environment, which is more uncertain, characterized, in particular, by geopolitical tensions in the Middle East, which, of course, impacted all equity markets and even more so on Alstom and secondly, the publication of our preliminary results mid-April, with the revision of our outlook prospects, which triggered a clear market reaction. Over this whole period, the shares performance is therefore lagging behind the benchmark index reflecting these specific factors. Against this backdrop, our priority is clear, strengthening operational execution, improving discipline in our projects, and gradually restoring our path to profitability and cash generation. This, in the long term, will allow for value creation for our shareholders. Thank you.

Thank you, Bernard. It's rare to see a financial officer being applauded this way. And so giving now the floor to Mr. Kevin Cogo in charge of the strategy.

Hello. Thank you, Mr. Chairman. Thank you, Bernard. Hello. So I'm going to now tell you about the results and the assessment of our CSR strategy. Our strategy is based on 5 pillars that covers all of our value chain, and the objective is to reconcile industrial performance and strengthen our resilience and reduce our environmental impact while at the same time, favoring so 0 emissions mobility is at the heart of our mission. We are a key player of decarbonization of mobility with a portfolio of comprehensive solutions with 0 carbon emissions, and we also carry many efforts in terms of reducing our own impacts, whether in our own production plants, industrial activities and services. The preservation of resources is a material impact for the group. And so we established a number of actions in terms of circular economies, and we're especially ramping up recycled materials in our rolling stock in '25, '26, 27% of materials used were recycled for all rolling stock. Our support to local communities through our different operations is also a key element through our foundation, in particular, and also activities that we perform in different regions. We have over 373,000 beneficiaries in '25, '26, and we're also working hardly for our different partners to increase diversity in the group and a culture on EHS, security, safety a crucial element as well and a differentiating element. And finally, we put a lot of effort into building a respectable and respect and responsible value chain with our customers, partners and suppliers. Now concerning the results. We have -- so for this financial year, '25-'26 made a lot of progress, so one more year in the right direction. We reduced our emissions. So measured in scopes 1 and 2 going down by 12% compared to last year. As mentioned, the solutions that we deliver, our customers have also progressed by 26% in terms of emissions compared to the 2021 reference here. And now in terms of social indicators, we are also making progress. It's been more than 10 years that we've been systematically reducing incidents in our production plants and with our customers and the framework of our services to reach in '25, '26 or 1.4% in terms of results. And our diversity is in progress as well with 26.6%, so women in managerial teams. These results confirm the efficiency of actions conducted and the, of course, mobilization of management. Taking this opportunity to give you a few illustrations of these -- some of these key elements. Now in terms of impact, and environmental priorities. In '25, '26, we reached 100% renewable energy in the group. In other words, through actions conducted on production sites with solar panels, for instance, and also by signing contracts for pure renewable energy contracts. And so we also worked on our own consumptions with a lead plan [indiscernible] 82% of sites are equipped with LED lighting, which is a significant improvement of our electricity consumption. Now in terms of our value chain and suppliers, vendors, we have multiplied contracts, in particular for raw materials. And so [ Auto Compo ], which is one of our major suppliers is now giving us. So access to low carbon steel. And on this commodity, we reduced by 93% our carbon impact, which is extremely significant. Finally, and as mentioned by Bernard, we are using the excellent results of our European taxonomy in relation to our engagements on climate engagements so as to be able to go into a EUR 700 million of issuing of green bonds, which, as you heard, was a great success. Finally, we are continuing our social engagement through our foundation with ASO safer, more inclusive, more accessible and greener mobility for all regions. And I mentioned here, a project in Mexico, which so fulfilled all these criterion is a beautiful illustration of what we are doing in these different regions. And so this is for us a very strong commitment, a mobilization of all times and of all hands. So thank you for listening to me and giving the floor back to the Chairman.

Thank you so much. Let me now present some information connected to the governance of your company. And then I will ask Mr. Baudouin Prot, who is presiding the Compensation and Appointment Committee to take the floor. As you well know, the past year has been marked by the departure of [indiscernible] from the CEO, who was Director of this company. He left his 2 roles on March 31, 2026. Ever since April 1, 2026, the Board of Directors. I'm presiding is composed of 11 administrators -- or directors, including 2 directors representing employees and 1 scrutineer. The independence rate within this council is quite high. 89%. The diversity is entered by the balance between women and men, but also different nationalities represented an expertise and experiences that are diverse and complementary. This allows your Board of Directors to comply with the regulations in force and with the best corporate governance practices. I also would like to say that the Board of Directors met times during the previous fiscal year and 7 executive meetings were convinced with an attendance rate of 100%. Now if we switch to the mandates of directors that are expiring, there are actually 3 of them. Mrs. [indiscernible]. The Board of Directors would like you to vote on a certain number of proposals relating to its composition after this general meeting. Mr. Baudouin Prot expressed his will to run for a reference within the Board of Directors. After considering this request, he -- we decided to renew a mandate or proposed to renew this mandate for 4 years, which is resolution #5 to replace Madam [indiscernible] who do not wish to renew the terms of office. The Board of Directors after proceeding to rigorous selection together with the support of an external firm would like to propose to appoint Mr. [ Pascal Bucha ] and Madam [indiscernible] for a 4-year term of office. These nominations will be voted for on resolutions 6 and 7. And the Board of Directors would also like to propose Resolution #8, That is the nomination of Mr. Martin Sion as independent administer trader or a director for a full year term. All the information pertaining to these applications are included in the notice of invitation. Martin expressed himself at the beginning of this meeting, and I believe that his speech will have convinced you of the relevance of his attendance to the Board of Directors. Mr. [indiscernible], also attending this shareholders' meeting, and I would like to invite them to take the floor so that they can introduce themselves. Pascal?

Thank you, sir. Hello, dear shareholders, I'm Pascal [indiscernible], up until recently, how was the CFO and IT directors for [ Telus ] with a lot of engineering businesses in aerospace, defense, cybersecurity and digital identity industries. Before this, I spent an important time of my career in the chemical industries, I'm a chemical engineer by training, and I graduated, I have 2 MBAs. And I started out as RND Engineer, before swing to a set number of industrial roles used to be production manager and then turn to the financial job roles. Before joining Telus, I used to be the Deputy CEO in charge of Finance and IT systems of [ Rhodia ] and [indiscernible] Group merged with [ Solvay Eversense ]. Thank you for your attention, and thank you for your support in advance. Thank you.

Thank you, Pascal. I will now hand over to Anna. Thank you.

Ladies and gentlemen, dear shareholders, thank you for having me and give me the chance to introduce myself on Spanish. I'm [indiscernible], I stated in Barcelona in the Polytechnic engineering school. My career has moved from one industry to the other, even though 20 years -- I spent 20 years of my professional life in the runway industry is using -- taking different roles, product management then services. And I've been in charge of major service business unit and [indiscernible] also was working for the general management in the railway industry still. And then I used to be an international manager at Suez and working in the waste and water and infrastructure businesses. For the past 4 years, I've been working at [ Equant ] as DTA, it is working in the energy and service industries and is a global player in these fields. So all these experiences European international and diverse industries I would love to utilize in order to work at the Alstom Board directors operating in the railway industry, which is a great transition industry in order to evolve towards a decarbonated connected economy. Therefore, it is a great pleasure for me to be with you today. Thank you for your trust and for your attention.

Thank you, Anna. Ladies and gentlemen, dear shareholders, should you decide to approve these resolutions after this shareholders' meeting, the Board of Directors will be made of 12 directors and 1 scrutineer with an independence rate of 80%. And man-to-man ratio of 40% and 60% with 7 different nationalities represented. Regarding now, the committees, there are 3 of them, after the shareholders' meeting, there will be a follow Mr. Baudouin Prot would be renewed as the President of the Nominations and Remuneration Committee Mr. Pascal Bucha would become the Chairman of the Audit and Risk Committee and Chair for the FX and Sustainability Committee. The number of members attending each committee would remain the same. Each committee being made of at least 2/3 of independent directors. All of this information pertaining to the direct Board of Directors and committees' activities during the past year and even more detailed information about all the topics that were studied last year are to be found on [indiscernible] 5 or the Universal registered documents 2025, 2026. Thank you for your attention, and I will now ask Mr. Baudouin Prot, Chairman of the Nominations and Remuneration Committee to please join us on stage in order to present the resolutions you will have to vote in terms of compensation. Baudouin?

Thank you. Ladies and gentlemen, shareholders, as the President of the Alstom remuneration and nomination committee, please let me read the resolution for you to vote about the remuneration palaces for 2026, 2027 and the rest, remuneration for the past year, as a corporate officer for your company, list of this resolution being despite on state. First of all, I would like to give you some information about the but conditions for Mr. [indiscernible]. A transactional agreement has been reached with the former CEO of your company on February 27, 2026, providing for the prevention and end of any litigation as he left his role of CEO. According to that agreement, a transactional amount will be paid out for [ EUR 1,325,764,000 ]. In counterpart of the commitment of Mr. Par Near to continue and cooperate with the company on prelitigation, all litigation procedures involving the company. This agreement has led to 2 specific vote. Resolution #4, since there is a regulated convention and resolution #9, asking you to approve the remuneration policy '25, '26 that did not include such an agreement. On top of it, and I'll come back to this in a moment. You will also have to vote on that indemnity considering more general framework presented in resolution #15. Regarding the 2026, '27 remuneration policy for the new CEO, there are 2 resolutions pertaining to this matter. Resolution 10 about the remuneration policy of including all the components with the main change in increase of the fixed annual remuneration of [indiscernible]. And Resolution #11 about a sign-on bonus that is not recurring with the performance shares. The remuneration policy for the CEO includes other components, those conditions remain the same. Benefits in kind, a supplemental pension schemes and noncompetition payment. All the information will be available at Page 269 to 280 of the universal registration document 2025, 2026. Regarding the remigration policy '26, '27 for the Chairman of the Board of Directors, you will have to vote on Resolution #12. This remains the same as compared with the past year. It is made of a fixed annual compensation and benefits in kind. All of this detail information, you can read on Page 280 of the Universal Registration Document '25, '26. The 2026, '27 remuneration policy for the directors will be voted for in Resolution 13. It remains the same. It is unchanged versus 2025, 2026 policy. This policy has been established on the basis of the overall envelope of EUR 1.3 million approved by the shareholders on July 1, 2014. And this envelope has remained the same Edison. With the fixed part, and a variable part. Those information you can find in details on Page 269 of the 2025, 2026 Universal registration document. Now talking about the remuneration of the past year, resolutions 14 and 16. According to Resolution #14, you will have, first of all, to vote for or against the overall global remuneration report, providing information about the past fiscal year for all of the corporate officers. I will not give you any detail in terms of remuneration for the directors and the Chairman of the Board since there will be specific resolutions to vote in a moment. There are kinds of information on this report. First of all, it's about the remuneration of the Board of Directors that received amounts to of 836,000 and information pertaining to the ratio of remuneration compared with determine of the Board's remuneration and compared with the remuneration of the group's employees. All these information, you can find on Page 281 and 291 on the Universal Registration document, '25, '26. Now switching to the remuneration for the past and Chairman of the Board. The '25-'26 remuneration of Mr. [ Henry Kuparlafaj ], who was the CEO up until March 31, 2026 will be voted on Resolution 15. On and on, Mr. [indiscernible] received a fixed remuneration of EUR 950,000 during the past year. And after this meeting, he will receive -- or is supposed to receive a variable remuneration, EUR 456,000 reaching its objective by 48%. On top of this variable remuneration, there would be a transactional amount of 1,325,964 as presented a moment ago. Regarding the noncompetition indemnity of [ EUR 2.808 ] million. This amount has already been paid for partly about EUR 117,000 since April 1, and this payment will continue up until March 31, 2028. All this information is detail on Page 292 of the Universal Registration Document '25, '26. Finally, Resolution #16. You will have to vote on the remuneration paid to the Chairman of the Board of Directors, '25, '26. Mr. Philippe Petitcolin received a fixed annual compensation as Chairman of EUR 450,000. Here, again, information detailed on Page [ 290 ] of the Universal registered document 2025, '26. Thank you, ladies and gentlemen, dear shareholders, for your attention. Over to the President of our Chairman for the rest of this meeting.

Thank you, Baudouin. I will now ask Mr. Richard Bijou of PricewaterhouseCoopers to please make a presentation of the statutory auditors report.

Thank you, Mr. President, ladies and gentlemen, shareholders and the name of the statutory auditors, the covenants PricewaterCoopers and [indiscernible], have the honor to give you the results of our missions as for the financial years finished. So ending at 31st of March '26. And so I'm going to summarize the terms of our report, which were given to your attention by the company. And so I'm going to start with our report on consolidated accounts of the court that we're prepared so according to the IFRS. This as adopted by the European Union. We certified the consolidated accounts of the group without any reservations or observations, we considered as key points of the additive following elements, elements that were considered to be the most substantial and were, therefore, given special attention from our part. And so the elements are concerned. So the -- so margin on long-term contracts, the evaluation of -- so litigation and investigation and we see here that our main mission is to obtain a reasonable assurance on sincerity, regularity and faithful image of accounts and to make sure that these accounts do not have any significant not only to do so. We intervene in all significant entities of the group, whether in France or abroad. And so the verification of management report and other documents are given to the disposal of shareholders does not lead to any comments on our part. Now concerning our reports on annual accounts of your company, and so this time presented according to the French standards. So we considered so as key points of our audit, the assessment of the inventory so value for securities and Alstom Holding. We validated these accounts without any reservation with just 1 observation of technical nature. So concerning the application of the general rules. So for the first article of the general rules, which applies to all companies in this industry in France are concerning. So the accounts. We have a new convention, which was subjected to your counseling, which is, therefore, subjected to your approval today and is detailed in our special report on the Page 305 of the universal registration document. And we also have a convention already approved by assembly and the execution being pursued during this financial year. Now concerning our work on information published in terms of sustainability, your company published for the second time the information for sustainability according to the provisions of the EU directive called CSRD, and we admitted a report to give us a limited assurance in terms of conformity of elements in this report that have to do with 3 dimensions of conformity. So according to ESRS standards of the processes of the company to determine impact risks opportunities conducted in relation to sustainability and conformity of published information in line with regulatory requirements of CSRD and taxonomy. And on the basis of the procedures that we implemented, we only -- we did not identify any errors or missions or significant consistencies concerning conformity of information with ERS and European regulations. And finally, in terms of the extraordinary part of your general assembly, we emitted 5 reports concerning resolution projects objected to the vote this afternoon and having to do with capital changes in social capital, and we have no objection on the principal of the resolutions proposed by your President. And so Mr. Chairperson, ladies and gentlemen, shareholders, thank you for your attention.

Thank you, Mr. Baudouin. We are now going to open the floor for the debates, and I would like to call your attention to the fact that you have these young ladies in the room to collect your questions. So you can either ask out loud with the microphone that will be added to you or through this question form that was given to you when you entered the room. Before we start, however, I'd like to call your attention to the fact that the company received questions in written form in relation to Article are 225-84 of the code of commerce on the part of its shareholders and from the CFDT trade union, so with the salesperson so Mr. [indiscernible] as well as Mr. [indiscernible], who is present today is from the Church of England Pensions Board in London. And thank you for the questions. And I'm now going to read the questions that were asked in writing to start with Mr. [ Ostertag ] in the name of the CFDT. Two questions from [indiscernible]. First of all, first question. The risk of evolution of the industrial organization in its press release of April 26, Alstom put forward the level of cash flow that wasn't up to our expectations and the objective of an operational transformation plan and new ambitions midterm in the -- during this financial year. What causes have led to this cash flow situation and issues? Is this impossible to remedy what evolutions are to be predicted and where? And in this logic of social responsibility on the part of Alstom's how is Alstom going to involve all potentially impacted stakeholders in the building of this new industrial organization? And so you see this is a very substantial question. Second question, of the CFDT as well. In terms of European context. Now to support its industry, both in terms of weight, richness, sovereignty. Europe is building a project for regulation, which is called the Industry Acceleration Act. And the rail industry is not mentioned in the concerned industry. So first point is Alstom defending, advocating the interest of being included in the IAA, so the Industry Acceleration Act. And second point for Alstom's industrial projects of rail building in Europe, what is the weight in added value of European local content? And third point, what is Alstom's ambition of either maintaining or increasing this weight in the future years and in what segment. And we are now going to let at answer these 2 questions from the CFDT trade union, and we'll go back to the second question from our British friend next.

Thank you, Philippe. So for the first question, now concerning the question of cash flow, and so this was recalled by Bernard, the level of debt of -- also today has improved, including during this financial year of '25, '26 so around EUR 400 million. We generated EUR 800 million in free cash flow during the last years. And so as I just recalled previously and also Bernard said it as well. So the performance that we had in '25, 26 led to the fact that we didn't generate this economic generation. And so we had to review the EBIT generation for next year by 1.5 points. And so relatively speaking, the impact on EBIT, of course, has an impact on the free cash flow. And so our guidance is now a free cash flow that's positive, and this is what creates the situation. And so these are the consequences of our operational overcosts, so the projects that we already mentioned. And the question to know whether this situation can be remedied. Well, of course, it can be remedied, but we have to improve operational performance, execution so that we also go back to free cash flow generation that will therefore, improve our situation. Now in terms of restructurations. Now -- so in '25, '26, we continued having optimization projects for our industrial footprint. There's a transformation projects underway in Germany that was already communicated on the [indiscernible] side. We also so engaged head count reductions, which are the consequence of the fact that we were not selected by the SNCF for a program of regional trains. And we are going to, in any case, continue, so improving our industrial footprint to see how and where we have to develop and where, on the other hand, we have to maybe reduce or optimize the site of our of our sites. It depends on the markets that we win, and there's already a number of optimization projects underway, for instance, in England, Australia and this is done without any slight closures. And generally speaking, what's important for science is to see their progress momentum the dynamics. And this is something that I was very keen about when I went to site visits the progress room for maneuver in each site, and this is crucial to keep in mind, a comment on social responsibility of Alstom and the way that we bring all stakeholders on board. And so generally speaking, Alstom maintains constant social dialogue with representative bodies, including of employees in the different countries where we have operations. And I had the occasion to the 2nd of July. So taking part in the European Work Forum, the European Counsel and which allowed me to exchange with the different trade unions and organizations represented and we will also align with all collective agreements and legislations when necessary, of course. And question number two, concerning the European local content. Now on the Industry Acceleration Act. So this Industry Acceleration Act, for those of you who do not know what it is, it's a proposal that was made on the part of the European Commission to recommend the use of aluminum steel and cement that be sustainable and European sourced and to lead to a certain number for it to become an obligation for a certain number of industries. And here, the concerns of rail for infrastructure because rail infrastructure is already going to be included. What's true, however, is that today, the European Commission is so making a reference to rolling stock in a future revision of the IAA, which means that rolling stock is not yet part of the IAA at this stage. And we consider that this 2-phased approach is consistent. First of all, because rolling stock is not representative of big volumes in terms of steel and aluminum and in addition to which there is requirements in terms of quality and nuances in this respect that are essential to guarantee the life span of projects over more than 50, 40 years. And so for us, it's important that we could -- so ruling to be considered into the AI once there is this availability of sustainable steel and aluminum and that, that situation improved. Now in terms of the industrial the European content of our projects and if I try to have the minimal amount, there were always above 50%. I of European content in our projects in Europe and sometimes way above that level. Now how is this going to change over time, we found a balance today to have the right level of competitive competitivity by advantage of our different locations worldwide. And so it's always advantageous logistically speaking, to be as close as possible, but we also have to also make the best of our costs, thanks to this worldwide footprint. And to go back to my first comment, we have to look at the competitiveness of our sites and the speed at which we can improve our economic performances for each site. And that comes into the equation as well.

So thank you, Martin. I'm now going to move on to the question that was asked by Mara lily from the Church of England Pensions Board in London, and since the question was asked in English, I am now going to let Emmanuel rephrase the question in French and potentially give it an answer as well. Emmanuel, go ahead.

Thank you, Mr. Chairman. Two questions were asked, which I'm first going to read to you, and then I'll try to give you an answer. The first question with following the removal of the project of the [indiscernible]. The question is what were the guarantees that were given to the Board of Directors that the underlying risks were managed and what safeguarding measures and controls are now in place to preclude any similar risks in the future. The Alstom Group has been observing for always a strict political neutrality and as a worldwide mobility player, we supply transportation solutions that will be beneficial to all communities in the world, including [indiscernible] so we do not answer what's real. And so we consider the access to transportation is a key element for social and economic development. Our participation in any project relies on an ethics program strict conformity respectful of French legislation and any legislation applicable. And we salute the decision of 2025, which in this respect, you voted for of the United Nations Human Rights commissary so of the UN. So concerning settlements in Israel. And this decision -- so it's aligned with the position of the position that Alstom has since 2023 stating that Alstom does not exercise any activity. So in line with occupied Palestinian territories. Alstom has to test no activities of operations in line with occupied Palestinian territories and has no intention of doing. So the second question was [indiscernible] transmitted was to know if more broadly how the Board of Directors supervises and make sure that human rise are integrated in all projects and partnerships that are conducted in different situations and/or countries at high risk including co companies or joint ventures and supply chains. And on what guarantees do we rely to ensure true efficiency of these processes. Now the Board of Directors as well as the ethics committee, make sure that integration of human rights are included in governance and in the risk assessment of the group, these risks are included in the mapping of [indiscernible] Alstom and are subjected to monitoring and regular monitoring with the ethics and Risk Committee. In terms of operations also applies due diligence measures that are strengthened and bolstered all along the project. So risks connected to human rights are assessed as of tender, thanks to analysis grid, which integrates specific criteria, in particular for high-risk countries that are affected by conflict before the implementation of mitigation measures when this is necessary. We also apply rigorous controls to our suppliers, subcontractors in any third including regular assessment due diligence, specialized utilities and corrective actions as necessary in terms -- in case of a serious nonconformity we put an end to the commercial relations and the efficiency of these provisions verified by this continuous monitoring process, including assessment of suppliers third-party controls the people we work with and plans and remedying actions and alerts through the alert raising programs are conducted at best. Thank you for your question.

Thank you, Emmanuel. We have several questions, and I have 4 documents that were just handed over to me the first coming from Mr. Philippe Petitcolin, who says, so since this idea of buying Bombardier, there is the forecast plan considered to be adequate. And the second question from the same gentlemen. So in terms of climate conditions, in particular, heat is the new-generation TGV going to be well adapted. Well, that's a very good question and very topical. So I'll take the first question. Now Bombardier trajectory is not the one that we considered, let's say. So the trajectory for projects coming from Bombardier was not what was expected in 2021. That's a fact. And now in terms of the quality of financial forecast in '23, this has been improving. Now what I'd like to say is that -- so we talked about how crucial our order intake is and how crucial it is to have it be balanced. And the fact that we have -- so high activities of service at Alstom is essential for the group, in my opinion, and this was brought to the group by Bombardier. And so I would say that Bombardier, we're not looking at what was going on in the past a few years ago, but the fact that we have this order intake now, which takes advantage of recurring activities and higher margins with the services is an advantage for the group. And in addition to which, when you look at the situation of rail at the time, consolidation was a good thing in my opinion.

Thank you, Martin. I now have a question from Mrs. [indiscernible]. Oh, apologies. I didn't talk about heat and trains, heat waves and trains because quite a few people are interested in this matter these days. So TJVM was designed with -- so nominal, so running temperatures of -- so 45 degrees, which is higher than what was taken into account with previous TGVs, which was around degrees and it can run at temperatures that are even beyond 45 degrees. And so yes, indeed, the [indiscernible] our Avelia Horizon range and all of it's so connected carriages and appliances are adapted to these high temperatures. And it is the application that is going to be -- so allowing us to adapt to AC systems to customers' requests. And it's been years that we've had the TGV lines, for instance, in Morocco. -- at these high temperatures. And keep in mind, this is not the question. But do keep in mind that if TGVs are not running today could also be for other reasons, for instance, so the high voltage lines and the whole infrastructure weather. So electrical, in particular, which is affected with the high temperatures.

Thank you, Martin. I think you're going to like this question, Mr. Mrs. [indiscernible], if possible, a club of shareholders visiting the site of Santa our offering drinks or sweet buffet for shareholders. That question is for me, I believe, to answer.

I will answer this one. Yes, I am in favor of creating a club of shareholders. I do believe this is a good idea. We'll think about it, and we'll come back to you hopefully before next year. but the very principle of shareholders of our company in this difficult time, as you heard it, we're not in a very favorable situation. If shareholders could actually see, understand discuss with the teams about what Alstom actually is, the actual asset value is to me, extremely positive. So I'm backing your request, and we will favorably answer your question. It will take some time, of course, because that's -- we have things in this company. But I believe that before the end of the year, we will be able to set up a club of shareholders. You will, therefore, meet and have a chance to discuss what this half, what the teams discover the products as well, this company is able to manufacture at the drinks and food, of course, I agree, it's not a problem. Next year, you will have access to drink and sweet buffet. So sweet snacks only. Now seriously, a question from Mr. [ Bernard Nigel ]. What about the future for the joint venture? And why so much delay in TGV and deliveries? Well, about the joint venture. The joint venture has played a major role in the high speed train innovation for us. On one side, you have the TV and then you also had the joint venture that led to the project with [ Italo ], the train operated in Italy. It's really real pride for our teams to see how successful Italo is, which is a success shared with Alstom. The architecture is quite different from our own TV since is an architecture that is articulated. So the technology embedded has helped Alstom develop know-how and therefore, to address the overall market. So it's definitely part of our technology portfolio so that we can address the high-speed train market. Regarding the delays for the high-speed train deliveries. I will not get into the details because I haven't experienced it directly, but what I can see is that with the TGV joint and [indiscernible], we have embarked a lot of technology indeed, and it is a project that hasn't seen last 30 years, it's not just incremental train. It's a brand-new train. And it also is a brand-new generation of designers, we are working with and has it ramping up. That's -- it's unusual to come up with such a train that will be a major asset for Alstom. Such a train with the state-of-the-art technologies and the best level global teams is unprecedented. And this is what I would like to insist on. And I noticed that when we are rodent article with SNCF about the commissioning of this train in September. The title, the journalist decided to keep was in a few months from now, we will not be talking about delays and there was quoting someone working at SNCF. How many trains are being tested currently? Well, currently, we are putting trends in conformity with the homologation process that was launched on May 22. There are some retrofit operations and some trains are in the pre-commercial phase that is they are operated by SNCF in order to be able to train some drivers. And we want to have 6 trains or 3 multiple units, rather, that will be available in September and 13 trains in total at the end of the year. And then we will reach our full potential in 2027 in terms of manufacturing. And regarding all the customers that we landed with Avelia, we launched an additional assembly line this year.

One question for Mr. [indiscernible]. Sorry if I'm misreading your name, is pronouncing the name. It is a handwritten note. Question for our CFO. What about the financial cost which is EUR 165 million in 2025 for a debt of EUR 400 million. That is to say 40% of annual interest rates, can you explain why such a high cost, considering the limited 6% industrial margin. Of course, it is a very meaningful question that requires further explanations from me, but it would be quite difficult to reconcile the financial results with a net 2 reasons actually. First of all, the debt is net of cash, whereas the gross margin we're paying interest on is EUR 2.650 billion. You saw that in the graph. You saw the deadlines. So at the moment, we need to pay the money back. And when you add the 2, the growth debt is EUR 2.640 billion. So we're not being interested on EUR 400 million, but on EUR 2.6 billion. Reason number two is that the EUR 160 million do not represent the interest that we're paying out, but it rather reflects the financial result, which is in aggregate, including the pensions cost evolution, but also the current effect also the cost of the debt, I mean, it includes many different things. So to answer your question more specifically, the cost of our debt burden is very limited. The reason to this is that we contracted this debt when interest rates were close to 0. So the cost of net is not 40%, but between 0% and 0.5%. And that is one of the problems we have to cope with the interest rates are now going back up. And the new debt we are taking the loans at a much higher rate, which is one of the financial challenge for the future.

Thank you, Bernard. Now perhaps we could turn on the lights in this room. We need some more light, please. So let's start the questions here. I have a question about the problems in execution during the past fiscal year. According to counsel, March 31, 2026, the adjusted operating margin was 6.1% instead of 7%. That was announced repeatedly at the beginning of the year. This operating margin has been suffered by execution problems in '25, '26 that triggered late deliveries and complaints from SNCF and RATP. How do you intend? And that is my question, how do you intend to reestablish homogeneous and controlled deliveries for all of your product lines? How do you, hence, intend to restore credibility and trust of markets? And revalue the Alstom share value that has remained way too low for many years?

It's a very good question indeed. And I fully subscribe to that question actually and have therefore ask this question to our CEO. That's the heart of the matter. That's what you insisted on. This has been the problem for this company for many years. Thank you for that question, Martin. Well, there is no [indiscernible] recipe. If it -- I mean, if we involve a couple of decisions and a few staff changes, this would have been done a long time ago, but it's important to understand to comprehend the company's culture and to understand how to strike the balance between project management, businesses, sites, relationships with our customers since this is part of them -- of the way specificities. When we talk about delayed, Alstom is not the only industrial players suffering from late deliveries. We have our own issues to cope with, but unfortunately, will work in an industry whose practices lead to delays. You're right, we have our own share to take and deal with, and so we do, but let's not forget that there are things to do in a more general way for the overall industry. And there was a meeting with 2 ministers that was held this very weak in order to try and work on the railway sector and somehow to try and improve our working ways with our customers. Now back to what Alstom has to do what I've seen so far, I believe that we had to work on design offices and in the factories in order to improve our lean management, but also our operational excellence practices. There are standards in the way to actually implement them and to create change culture are important elements that involve the size that produce trains and all the regions. I believe there are things to improve in operating modes. So we are doing -- so with the Alstom leadership team. And regarding costs, we said that we are trying to optimize some sites, [indiscernible], U.K., Australia. There will be things to do here this here, too. And that is the reason why we wanted to take some time before announcing and kicking off a plan. Some programs have been kicked off already to give more empowerment to product managers and to somehow simplify some operating methods. We are currently working on decreasing our cost and boosting our procurement policies. So it wouldn't be realistic to tell you that the solutions will be implemented in a few months time. But we will be able to follow a rule that it will be much more performant than what we followed in the past. Are there other questions in the room? Please. Aman Schneider. Going back to the industrial sites. You talked about Bruce and the SCB order that you did not get. Regarding Germany, I'm referring to legomative workshop, which was created 200 years ago with very good practices and many different public and private freight customers. These new committees we see everywhere, including in France. And we do not understand what the benefits will be attached to the selling of this unit. Could you please further elaborate and explain why you decided to sell this factory?

Well, we have been approached in order to enter discussions -- into discussions about the slide you referred to. Today, we have no specific project attached to this. But considering the current situation, if we were to find solutions for our employees, for our sites in order to improve our product lines competitiveness, it would be, of course, my responsibility to consider these. To date, we haven't found a specific avenue to follow, but I'm always open to suggestions, and it wouldn't be reasonable to tell you that if we identify the solution to preserve jobs to improve our footprint and to improve the product competitiveness, which is what we need to conclude the successful project, it wouldn't make sense not to consider that project. But to date, there is no such thing. Any other question? And Bernard wants me to say, it's not about stopping the -- producing locomotives. It goes without saying. [indiscernible]?

Mr. [indiscernible]. I don't know if you can see me. I have a quick question. There was a change in management general management, I'm very surprised that in such big companies, we have to recruit outside. I believe that there were production issues and that these problems were reported on internally why these people who perhaps acted against their hierarchy by selling your warning message are not rewarded and are not promoted. I think it's a [indiscernible]. That was the first thing. [indiscernible] departure. He will cash in 1.3 million. This is Resolution #4, plus EUR 2.8 million of non-compensation costs paid out during the next 24 months to come, plus the lower use costs paid for by Alstom. Could you remind us of these litigations? And one more thing about the rival of Mr. So Resolution 11, there's a [indiscernible] combos of EUR 1.1 billion. And looking at the annual report, it is justified considering its former ISPs compensation levels that remain confidential. That includes compensation and stock options. [indiscernible] is confidential, and we say nothing about it or we have provided clear indications about this amount. So that shareholders can actually understand what this EUR 1.2 million is about. That's why I would rather have -- I would rather see internal people, asked them people being promoted, especially since they reported on the past problems.

Well, I think there are many, many things attached to your question. I will try to give you an answer, but don't hesitate and if I do not answer everything. About internal or external recruitment. You know what? That's not how we thought how we considered the question. When we decided -- when the Board of Directors met and decided that it was time to make a change, we worked with the nomination and remuneration committee relied on the headhunter, if you like. You considered a certain number of applications, both internally and externally in and out and there were perhaps 30 potential candidates. And there was a preselection that was operated. We shortlisted 10 candidates. And I will give you names, but there were internal candidates. And on these 10 applications, there was a selection. We shortlisted 5 candidates, the 5 candidates, the Remuneration and Nomination Committee supported [indiscernible] application as new CEO. But there was no exclusive selection process, focusing only on external candidates versus internal candidates, both internal and external candidates were considered. For what I understand in your question, perhaps there was a lack of acknowledgment and internal promotion. This is part of the questions that Martin is currently working on. I believe indeed that someone who spent a such a number of years working for a company who knows the company. And you contributed to the company's results should be thanked and should benefit from career development opportunities, agreed on this. Internal promotion schemes are considered, but sometimes, we need to recruit outside because we believe the right talents are not identified internally when they are required. This is part of the manager's decision. Regarding the transactional agreement, I have nothing to say. This is something that is submitted to you today. It's your decision, you will decide. This is how things have been planned right from the start. A transactional agreement is subject to the submitted to the shareholders' meeting that will see whether they are supporting or not this transactional agreement. And the other elements you are referring to about the noncompetition agreement or the bonus of Mr. [indiscernible]. These are contractual elements included in the statuses of our company. So we only implement the rules of our companies, nothing more, nothing less. About the compensation package of Mr. [indiscernible]. Well, indeed, we supported the proposals that were made by the remuneration and appointments nomination committees, to cement all the remuneration proposals as presented to you by Mr. Bula Po. The basic salary of Martin compliance with what is adopted in France. And I cannot tell you what this remuneration could be if we were part of a European or global system, salaries in France are way below what they are in Europe, not to talk about America because that would definitely scare your way. Now regarding the sign-on bonus, that you will have to vote on regarding Martin Sion arrival. It represents share of what Martin lost when he left his former job. Maybe you know or some of you know that wages and compensation of executive managers are at 3 part, there's a fixed compensation, short-term bonus with the objective of the years to each, and there is a longer-term bonus that is calculated over 3 years to try and going back to what you said, to the internal promotion schemes to try and retain the people we do not want to leave. That's what we call the long-term incentive. And so this long-term incentive, Martin was entitled to his former company. It is a private company, so we don't -- we do not have to know the specific amounts. But what I can tell you is that what we are proposing today in terms of sign-on bonus is just a part of what margin lost. It's just not 100%, but it's a part of what he lost. And what we already decided altogether was not to pay out cash, but rather to give performance shares. So this bonus is subject to the performance of Martin and of the company in the 3 years ahead. So I believe that we are definitely in line with the market and with the international company's operating rules. Are there other questions?

So I'm an individual director, a shareholder. There we also generated about so EUR 1 million in profits, and we decided, so again, to not issue any dividends. And so postponing of EUR 6.4 billion, what is the advantage of keeping this in your accounts? Or is there a strategy for using this amount? Substantial amount. Second question, the hydrogen trains. There is quite a bit of noise around this, a bit of publicity. And so where do we stand today? Could you give us take stock of the situation? Third point. The renewal of [indiscernible], we all know and recognizes qualities. But I would say that comes a time at an age where maybe you have to hand over. Thank you.

So you have 3 questions, actually. Okay. So the first, I'll leave to Bernard. Bernard Delpit, our Financial Officer.

Yes. Thank you for your question, dear gentlemen. Now unfortunately, there is unfortunately no massive sum, as was said in French is certainly not to the extent of EUR 6.7 billion, which is an accounting figure, which assesses reallocated reserves and to which a certain profit is reallocated, which is an accounting amount. So within French standards, financial accounting standards and which is not the representation of cash that could have been generated for the company. But I do understand your frustration in terms of dividends. And so with the caveat of what the general assembly will approve. But the logic that was retained was first to want to reduce the level of debt of the company. And the net debt being EUR 400 million, which was reduced by about EUR 40 million this year. And so if a fraction of the EUR 100 million, not the EUR 100 million, but the EUR 300 million in net consolidated so profit. So back if we -- so did this profit sharing back, it would increase debt of the company. And so paying dividends, so -- and therefore, increasing the debt is not according to us, a good logic, but it's up to the shareholders' approval. And so I'm just going to highlight the logic. But if there was, however, EUR 6.7 billion of favorable cash flow, I'd be a lot more relaxed right now, which is not the case.

Well, that's unfortunate. So now, what about hydrogen fired trains?

So the news in the last few months is the acquisition that we made and this appear to us as being the only solution to have a control over this product that we absolutely need to uphold the commitments that we made vis-a-vis our customers. And so what I expect is thanks to the integration of these operations within Alstom. And thanks to the support that we can bring in this respect. And we have a number of technologies that we're working on. And so my expectation is for us to have a high-quality product, which allows us -- will allow us to have a competitive edge. And from there, will be implementing a strategy. And so for now, we're just in the consolidation phase of our products so that we can meet our commitments and then we can move forward from there. So thank you. The question on Baudouin now. Baudouin has demonstrated his value and his expertise during his last 2 mandates as a director, and he conducted quite successfully and diligently the work in terms of the succession of the General Director. And this is the reason for which the Board of Directors also plans to renew his mandate as the Chairman of the Nominations and Remunerations Committee. At [indiscernible] general fashion, the Board of Directors considers that the age of a director does not stop him or her from conducting his missions successfully. The average age within our Board is 62. If you look at the SBF 120, it's a little over 60. And so we are within the industry average. And we were talking about Baudouin. But in the first row, you have a director who is 33. And so is he too young? So it's a whole -- a comprehensive whole Board of Directors and a set of shareholders for that matter is a whole set of skills, experience, expertise and a bit of common sense as well, if you have that amount of common sense that you need to be sure that you can so analyze and criticized management win is needed and do the work that you and trust us with you as shareholders and we as directors, I think that we do our work well. Is there another question? Microphone #3.

[ Michel Cura ], individual shareholder. I'm more specifically interested in the level of debt. I've been -- so I am a shareholder of different listed companies who -- which within their debt either have a bond maturity plans or bonds that can be paid back in shares, and these are programs that are not very well explained usually. And not very well measured by shareholders and that could disrupt the share prices quite a bit. And so I'd like to know if in your debt, you have these types of elements that are actually connected to issued bonds and/or the payment of bonds in the form of shares. And if this is the case for the future, I would finish with a piece of advice, please give very precise and clear information so that shareholders not end up multiplying by a certain number of a certain percentage, the impact of this type of debt product or vehicle.