Ladies and gentlemen, welcome to the Alstom conference call. I now hand over to Henri Poupart-Lafarge. Sir, please go ahead.
Hello. Good morning. Welcome to our annual results conference call. I am, together with Laurent and the investor relation team, here to answer your questions and to present to you the annual results. Just as an introduction, a few highlights of these results, as you probably have already seen them. First of all, the order intake, which is at a record high of EUR 12.1 billion. I will come back on the major orders. This leads to a record backlog of more than EUR 40 billion or book-to-bill of 1.5 during the year. The operational performance of the year has been strong. We saw sales at EUR 8.1 billion, in line with our guidance, which was at EUR 8 billion. It is a bit above our guidance. The growth, as compared to last year, was 10% or 11% organically. Not a lot of parameter changes.
The margin was at 7.1%, up from 5.4%, as well in line with our guidance, which I will recall you was around 7%. We are a little bit above this 7%. In terms of balance sheet and cash flows, we have generated EUR 153 million of free cash flow. This includes some cash out related to the Siemens-failed merger. We have a net cash position of EUR 2.3 billion. This is, of course, related not only on the free cash flow of the year, but also of the proceeds of our disposal of our stake in GE joint ventures. This all together has enabled us to propose, or the board will propose to the next general assembly, a dividend of EUR 5.5 per share.
This will be legally an ordinary dividend, although you would understand that the amount of this dividend is exceptional and is, of course, related to this proceed that we have received from General Electric and not directly from our net income, as you can imagine. In terms of business, I think for the last time, you will see this slide, which summarizes our 2020 strategy, which again has been a great success over the last years and which has enabled us not only to grow, but also to grow profitably and to develop our company worldwide. We go through all the main pillars of this strategy. The first one was what we call the customer-focused organization, which was to basically globalize the company to be present on all continents. This is being translated into orders intake on all fronts, all continents. You can see on the slide.
Of course, when you look year after year, it's mainly influenced by large orders. The share of Europe at EUR 7.3 billion out of the EUR 12 billion, which is quite high, is notably due to the order in France for very high-speed train. Similarly, EUR 2.2 billion in the Americas is mainly driven by our large turnkey order in Montreal. In MEA, Middle East, Africa, it's mostly the maintenance contract in Riyadh, and we have a number of orders in Asia Pacific, particularly in India. In terms of activity, what is quite remarkable this year is the high level of service order of more than EUR 3 billion. A very nice book-to-bill of a very large long-term service contract. I was talking about Riyadh, but also Montreal includes a maintenance contract. We have on Signaling, we have book-to-bill greater than one.
I think actually it's a record level for our Signaling order intake of EUR 1.5 billion. Again, system is mostly the Montreal order and rolling stock, the largest order is the TGV one. Here you see our main orders of the year. I've already detailed in Canada, in France for the very high speed, but also for some regional trains and also for the new métro du Grand Paris, around Paris. Quite noticeable in Signaling, we have the onboard equipment for Norway. Norway has launched a complete revamping of its Signaling systems, and we have been awarded the onboard part. In Germany, we wanted to outline some regional trains, but also some trams. It's the first time we penetrate the German market for tram, and we do that in the city of Frankfurt. Luxembourg, some regional trains, more classical.
Italy, we are continuing our success story with NTV, with Pendolino trains and maintenance. Saudi Arabia, I already said it. In India, Mumbai Metro, some Signaling activities as well. In Australia, we have also some maintenance activity for the Sydney Metro, which had been awarded a few years ago. In Taipei, we have also a metro system. Again, quite a geographically spread order intake this year, which is in line with our strategy. And this is illustrated as well by the market share and by our leadership position on all continents. As you can see, this year again, we are number one, number two in all the main continents, which is our goal, our objective. We have continued to rebalance our employee base.
If you were to compare with last year, we have now increased quite significantly our employees in the Middle East Africa, particularly in South Africa, due to the ramp-up of our contract with PRASA. Asia-Pacific with the ramp-up of India, Americas, with the ramp-up of the activities to deliver the very speed train in the U.S. While employees in Europe have been more or less stable. We are in line with our objectives in terms of allocation of these activities. You remember that at the beginning of 2020, we set as an objective to have 40% in rolling stock and 60% in the other activities, which is more or less where we are today, with 43% of rolling stock, 19% of service with a very nice growth of service, 16% of Signaling and system, which is also very high.
As I said the last time for H1 results, and it is true as well for H2, the main contributors of sales in terms of projects are today Dubai and Riyadh. Dubai being a very fast-track project and Riyadh being a very large project. This explains why system is so high. We don't expect it to remain at that level in the future. This is exceptionally driven by these two contracts. In terms of solutions, some systems, Montreal, Riyadh, I've already mentioned them. In terms of sales, if you look as well in terms of activity, we have gone basically on all our activities in rolling stock, in systems, again, with Dubai, Riyadh and Lusail as well in Qatar. Panama has been also quite a nice contributor. Service has moved positively. It is good news.
You remember that it takes a lot of time to grow our service sales because between the order intake and the service, it takes a long time to be translated into sales. Now we see that coming. Signaling has still been relatively weak this year on the back of low activity in the U.K., which was on the back of low order intake the years before. As we have seen, we have this year a rebound of orders, we are more optimistic for the future of the signaling growth. Sustained R&D. You remember that this was one of the goals also of 2020, which was to sustain, in percentage term, all our R&D efforts and to take advantage of the growth of the company. We have now completed the renewal of our platforms.
You also recall that we launched a new tramway platform five years ago, then a new metro platform, then a new regional train platform, and now this year, we have launched a new very high-speed platform. We are now in full development of TGV 2020, the new TGV for SNCF, as well as the new TGV for Amtrak in the U.S. We are continuing to develop our signaling activities and notably our urban platform, we have reinforced recently our effort on the main line as well. Of course, we continue to invest in digital solutions for smart mobilities. What is quite noticeable this year, I think that our two main disruptive innovations, as far as vehicles are concerned, have been, I would say, awarded some contracts this year.
I think the one which has attracted a lot of attention, which is the iLint, which is a hydrogen train, since it is in operation in Germany, a number of countries in the world, including France and the U.K., for example, are extremely interested by this solution and have launched some hydrogen plans. This is now from, I would say, an innovation to a commercial success. Similarly, we have launched this new vehicle which is halfway between a bus and a tram, we have been awarded the first contract in Strasbourg, in France. You know as well that we have been nominated preferred bidder and would be officially awarded the contract soon from RATP in Paris. This is two successful launches of our new platforms, new disruptive platforms.
Operationally, we continue to improve and we expect, of course, to continue to improve in the future. This is on the back of the volume increase, but also on the efficiency and also of the project execution, the mix, as you know, all the different levers that were at the origin of our 2020 strategy. We have achieved, as expected, 7%, and if not a little bit more than 7%, I just said a bit. Levers were classical levers with the sourcing levers, with a global sourcing. If you were to look year after year, you would see the volume purchased in low-cost countries moving up regularly from what was 30%, probably 4% years ago, to now more than 50%. This is also on the back of the globalization of the company. This is a new lever.
We are more and more using robots and having automated lines. You know that this is more complex to do it for transport than for other industries, because we are talking about extremely big and not standard equipment. It's not easy to automatize, but still, we are doing that. We are increasing our global footprints with the Indian ramp-up, and as well in Europe, which needs to also rebalance between Western Europe and Eastern Europe. We are ramping up very rapidly our factory in Poland, which is becoming our largest factory, actually, in Alstom. Two contracts which are quite iconic and you know quite well. The first one is in South Africa. The first trains have been delivered out of our factory in South Africa, which is a very impressive success.
Here you can see on the picture for the U.S. that the trains are not totally out of the factory. However, we are on time for this very important contract for the Avelia Liberty, which is the name of this train, to start the testing by the end of the year. In terms of environmental excellence, we are continuing to improve our situation and to be in line with our objective also, which were set a few years ago. We are reducing our energy intensity. We are improving the energy consumption for our solutions. As you know, this is increasingly one important driver for our customers. We are working on safety at work, where we have plateaued a little bit at 1.1 this year. We continue to improve the situation. Finally, on people. We have increased our number of people.
We are now more than 36,000 employees, again, with the main increase coming from continents outside Europe. We are progressing as well in terms of gender diversity, although, to be fair, slower than what we would like to be. Now, if I had to mention it, at the ExCom of Alstom, I think for the first time now, three women, which is already, I would say, a progression. Ethics and compliance. No compromise with ethics and compliance, of course. Now I will hand over to Laurent for some comments on the results.
Thank you, Henri. Good morning, everyone. Starting with P&L on page 22, going straight below the adjusted EBIT of 7.1%. As you see, we have EUR 65 million of restructuring charges, driven by footprint rationalization and competitiveness initiatives, mainly in Germany, Brazil, and the U.K. Moving to the other charges of minus EUR 97. This includes some amortization of intangible assets and integration costs related to SSL, GE Signalling, and Nomad, which has been reduced to minus EUR 15 million. Transaction cost related to the Siemens-failed merger, which amounted to minus EUR 74 million. Other costs relating mainly to the net of legal proceedings provision and capital gain on disposal of assets linked to the dilution of TMH and the takeover of EKZ in Kazakhstan. Moving to the financial result, at minus EUR 88 compared to minus EUR 99 last year.
Consistent very much with the decrease of our gross financial debt with, as you know, the repayment of our bond in October 2018 of EUR 371 million. Moving forward, we see the financial result, which should continue to improve as outstanding bonds would be paid out in 2019, 2020. In terms of tax result, we have recorded a tax charge of EUR 17 million, which is consistent with an effective tax rate of 22%, including some positive one-off impacts, compared to 36% last year. Moving forward, we expect to come back to a normalized level, which is close to our 25%-30% that we have been indicating in the past. In terms of share in net income from equity investments amounted to EUR 195.
This includes, for the last time, the Energy Joint Ventures accounting consideration of EUR 106 million, as well, some TMH very positive performance of EUR 66 million, including some positive one-off in the H1. As well, good performance of our subsidiary in China, CASCO. Finally, I remind you that in H1, we have recorded an exceptional net income of EUR 248 million associated to the GE transaction. As a result, net income jumped from EUR 365 million to EUR 681 this year. Moving to the cash side. Our free cash flow was positive at EUR 153 million, driven very much by the EBIT evolution. Without Siemens-failed merger cash, as Henri was mentioning, this free cash flow would have been around EUR 205 million, approximately. Change of working capital was limited at minus EUR 12, driven by the ramp-up of our major projects, which have been signed in the past years.
Free cash flow has been as well impacted, as you see, by the financial cash-out and the transformation CapEx, which I will detail now. On the CapEx side, we have been spending EUR 207 million of CapEx in tangible assets, this supporting our global footprint and our strategic transformation. In terms of transformation CapEx, we have been spending EUR 110 million, moving from construction of manufacturing site in India, South Africa, where you see pictures of the Gibela factories, with the start of the first PRASA trains, which has been delivered, end of this fiscal years. As well as the expansion of Hornell in the U.S. for Avelia Liberty. At the end of March 2019, we have accumulated EUR 269 million of transformation CapEx out of the EUR 300 million we have been communicating. The remaining will be spent this year.
Moving to the liquidity and gross debt, we have a gross cash in hand of EUR 3.8 billion at the end of March 2019. In addition to this EUR 3.4 billion of cash and cash equivalents, we have access to a EUR 400 million revolving credit facilities, which is maturing in June 2022, which is, as we speak, fully undrawn. On October 2, 2018, I remind you that we have indeed completed the transfer of all our interest in our three Energy Joint Ventures to General Electric, and we received a total cash payment of EUR 2,594 million. In terms of debts and bonds, as I was mentioning before, we have EUR 878 million of outstanding bonds as of end of March 2019, and all of these bonds will be repaid until March 2020 with the next maturities in July. Turning to the net cash.
The key drivers are obviously the positive free cash flow evolution, and the acquisition and disposal, which is chiefly the proceeds coming from the sales of the JVs to GE. As well, I remind the acquisition of the TMH Locotek transaction, which we have been recording as well in H1. We have as well limited capital increase, dividends, and Forex and others, turning to a total net cash end of March at EUR 2.3 billion. Moving to the equity. Equity moves from EUR 3.4 to EUR 4.2 billion, most impacted by the positive evolution on the net income, EUR 681. Some variation on pension of -EUR 49 million, driven by interest rate changes. Dividends paid to shareholders for -EUR 78, share-based payments for EUR 39, and Forex and others for EUR 136 million.
As Henri indicated, given the net cash position at March 31, 2019, the board of directors has decided to propose a dividend of EUR 5.5 per share, which is equivalent of an amount of EUR 1,230 million to the shareholder meetings, which will be held on July 10, 2019. Looking at the net cash post-dividend, we will be at EUR 1,995 million, without considering IFRS 16 impact, which has been estimated between EUR 400 million-EUR 500 million. On IFRS 16, it will be communicated for the first time in our H1 results in November. Thank you very much for your attention. I'll go now back to Henri for the conclusion.
Thank you, Laurent. In one word, the conclusion that as you have seen, we continue to record an excellent commercial momentum, a strong operational performance, which has sustained the good net results, which in part, of course, explains the dividend, as said by Laurent. It's also related to the proceeds of EUR 5.5. As you probably would recall, we will launch the new outlooks, including for those of you who had the question, new guidances during our capital market day at the end of June. I think this will complete, again, the 2020 strategy, which has brought a lot of positive results for the company and for its customers. Now we need to open a new perspective, and this will be done at the end of June, and we'll do a little bit similarly to what we did three years ago.
We will give some mid to long-term perspective to all of you. Thanks again for being here, and now I'm taking the questions that you may have.
Thank you, sir. As a reminder, ladies and gentlemen, to ask a question today, please press star one on your telephone keypad. We'll now take our first question from Ben Uglow from Goldman Sachs. Please go ahead. Your line is open.
Hi. Good morning. Thank you very much for taking my question. My first one would be about the dividend. Obviously, after the kind of exceptional dividend of €5.50 this year, I'm wondering how we should think about the recurring levels of dividends in coming years. If you could provide any color around that would be much appreciated. Just a second one on, if you could talk about the large order environment that you expect in the following year, especially after the strong commercial momentum that we've seen this year. Thank you.
Thank you, Ben, for your question. Of course, I said the dividend of this year is exceptional. It would be legally an ordinary dividend, but of an exceptional amount. Going forward, we will resume, I would say, a classical dividend distribution. We have no guidance precisely on what should be classical. Up to now, I have to say that in the last three years, our net results have always been impacted by exceptional items. This normally should end next year or this year. This year ending March 2020 should be, I would say, a normalized year with, I would say, a normal level of distribution. In terms of commercial outlook, this year has been particularly strong, mainly due to a good level of mid-size orders, but also due to two very large orders, one in Montreal and one in France, as you know.
I don't see in the coming period such a level of exceptional orders. We continue, as you know, to fuel our growth through a book-to-bill, which is above one regularly year after year. The volatility is there, and I would qualify this year as being not only excellent but also exceptional. I don't expect to repeat this kind of order intake year after year. We still have a lot of the pipeline. The markets are still extremely good. You know that mobility is at the heart of all political agenda. There is no problem of number of opportunities. The fact to have these two large orders in the same year is something which is rather exceptional. Next question. Thank you.
Our next question from Gael de-Bray from Deutsche Bank. Please go ahead. Your line is open.
Yes. Good morning, everybody. Can I have two questions, please? The first one is about the systems business, where the book-to-bill has been well below one times now for the past two years. You've just said that you do not expect the systems revenues to remain at the current high level. Could you elaborate on what it means for the coming year's group revenue growth and margin mix? That's question number 1. Question number 2 is about your capital allocation strategy. Can you discuss what you consider would be an appropriate leverage for the group going forward? I think you've alluded to that, but how come you don't have a normalized payout ratio that would be official?
Thank you. In terms of system, this year, as you have seen, we have still recorded a relatively high level of system order intake, and notably, again, through Montreal. We have also recorded some system order intake in Asia, like in Taiwan and in Vietnam last year. It's fair to recognize that one of the main drivers of system was Middle East. Main region which was really a system region was Middle East. If you talk about Saudi Arabia, for example, yes, we are executing Riyadh, but the other projects, whether we talk about Mecca, whether we talk about Jeddah, have been delayed. We don't expect the level of system order intake to be as high as it was in the past.
We can also add, by the way, that Latin America is also relatively weak, and this was also a system region. We could expect in the mix a slight decrease in system. In terms of margin, system margin, we were saying that usually in terms of order of ranking of margin, system is, yes, above average, but not I would say usually above the average. It will not have a huge impact on the margin. On the growth of the company, it's clear that the growth will have to be fueled more by service, by signaling. As I said, we have a rebound of signaling activity with a nice order intake this year. Of course, the slighter growth of system or the decrease of system will have a slight impact on the growth of the company. But that has not, I would say, a major impact.
We will review all that during our capital market day end of June, including, I'm not going to give any guidance today on the dividend policy. I think we want to have, as I said, a normalized dividend policy, which is in line with market practice. I will talk about that again at the end of June.
Thank you. Our next question comes from Simon Toennessen from Berenberg. Please go ahead. Your line is open.
Yes. Good morning, gentlemen. My first question is just on the margin development in H2. It was obviously slightly down versus last year in the second quarter. Maybe you can just provide a bit more color on the various drivers. You obviously don't provide a bridge there, but just if you could talk a bit about the various sort of margin drivers in the second half and the impact there. Also, if you could talk a bit more about what you would expect for 2020, and I appreciate you're probably not going to give any guidance right now as you wait until the 24th. Maybe just in terms of just color around sort of improvements versus deterioration when we talk about maybe mix and savings, et cetera, that'd be very helpful. Then last question on the free cash flow. You obviously had some of the one-offs.
Could you quantify some of the one-offs a bit more? You talked about the Siemens-Alstom deal costs, for example, that had an impact. Do you still expect some of that to come through in the first half of 2020, or is that completely over with? Thank you very much.
Thanks. In terms of driver for the profitability of H2, it's true that the volumes have been stable between H2 of last year and H2 of this year. Now it depends on if you compare with the IFRS 15 adjustment or not. The margins are driven by the cost improvement and our operational plans. It's also driven by the mix of projects. It's difficult to draw conclusions on a short-term basis. What we see that this H2 of this year has a quite good margin. Last year, particularly if you look on the previous accounting standard, we had a number of milestones during the last quarter, which explained a very high level of sales in the last quarter. Now with IFRS 15, the sales will be more regular. We will not have this kind of phenomenon of high level of milestones.
I think it's a combination of the cost drivers as well as the mix, which has generated this relatively similar level of margin from last year to this year. In terms of free cash flow, maybe Laurent will say a word, but we have Siemens, we have also the CapEx, and then I will come back on the color for next year.
Yep. On the free cash flow, indeed, there is around, as I said, more than EUR 50 million of impact from Siemens-Alstom. Without that, we will be at more than EUR 200 million. There will be a bit, to your question, Simon, of cash out still in the first half of this year, but more limited than the impact of last year, for sure. There is, moving forward indeed, this cash out for financials, which will be improving as well in 2019-2020. With regard to the CapEx, as I said, there is indeed the drivers related to the transformation CapEx, which will be running out in 2019-2020. However, we continue to see a need for investing in capacity in our plants for 2019-2020.
Thank you, Laurent. In terms of perspective for this year, I said we are not going to give any guidance for the year. Broadly, I would say that there is no reason why we should go backwards. We need to continue to improve our situation, operationally of course, in terms of sales and in terms of profitability. As I said at the beginning, and I think answering to a question, I don't expect the level of order intake to be repeated. That's clear. Despite, again, this is not a negative message on the market, but this is a more realistic message on the fact that we are not going to be awarded such large contracts. It's quite exceptional to achieve that.
In terms of mix, as I said, the mix impact will be probably of less importance, I would say, because again, system will go a little bit down. Service will continue to grow. Signaling will continue to grow as well. System will be a little bit down. In terms of costs, we will continue to benefit. If you look at our past three years, we had a mix impact, which has played a quite strong role. Quite recently, we had a margin impact, a stronger margin impact at the level of, I would say, the gross margin, the cost of sales. This is related to the impact of the consequences of the renewal of our rolling stock platforms. It took a few years for this new rolling stock platform to bear fruits, and they are bearing fruits.
We should expect that this year again. We'll continue to benefit from this cost reduction initiatives. All in all, we continue to grow and improve our situation. I would say I will go for in more details end of June.
Thank you. We'll now take our next question from James Moore from Redburn. Please go ahead. Your line is open.
Good morning, everyone. Hi, Henri, Laurent. I have two questions, if I could. Firstly, on your 2020 strategy, it's been a great success in a number of P&L categories, but maybe it's fair to say that the cumulative free cash flow conversion remains below 50%, even if you adjust for exceptional items. Just broadly, how do you feel about that performance? As you look forward, given you are signaling that CapEx won't come down after the transformative programs come to an end, do you think that the previous target of moving conversion towards 100% is realistic, or should we think that it is not?
Secondly, if I could, on the order intake margin, can you give us a flavor without any numbers as to whether the order intake gross margin that you track internally in the full year of 2019 was above the order intake margin of full year 2018?
Thank you, James, for your questions. Yes, you're right that we should continue to work on the free cash flow generation. 2020 has been impacted, or the 2020 strategy, by the need to heavily invest in CapEx. This comes to an end, this should ease, I would say, this burden on our cash flow. If you look at the working capital over the 2020 or the three or four last years, the working capital has been relatively stable. We have improved on some years or slightly deteriorated in other years. Overall, quite stable, which was one of our main objective, which was to make sure that we keep the same working capital situation. On that perspective, I think we are in line with what we said then. It's true that the net income, for example, and the EBIT, has been impacted by a number of exceptional events.
Some of them were non-cash. I would say I'm not negative on the performance of the cash flow, but it's fair to recognize that this needs to be continued to be worked on in the future. On the gross margin on order intake of this year, as you know, and that you say, we don't give the exact number of that. The gross margin is actually very good this year, this should not come as a surprise because, as you have seen, we have EUR 3 billion of service order in this order intake of this year, and this service order has a service type of margin, which is quite good. This explains a globally good gross margin in the order intake. Now we have, I think, a good, if not a very good, level of gross margin in the order intake of this year. Thank you.
Next question? Thank you. Our next question comes from Jonathan Mounsey from Exane BNP Paribas. Please go ahead.
Hi, yes, good morning. Thanks for taking my questions. Two, please. Just first of all, on working capital development in 2020, thoughts there. I think consensus for order intake's at around EUR 9 billion for FY 2020. Thinking about particularly prepayments, what's likely to come in, and the distortion there. Do we think, particularly with cash being weak in the second half of this year, is there a catch-up? Can we see a working capital inflow in 2020, given what the situation in 2019 was? Just a second question, perhaps a bit more explicit on CapEx guidance going forward. Obviously, slide 24 seems to imply that the normalized level is more like EUR 100, but you are talking about continuing to invest. What's the right way to think about it? Is it EUR 200 going forward? Is it EUR 300? Obviously, this is quite important for our models.
Thank you for your question. On the first question, as we classically say, there's a huge volatility in working capital. It happens that actually over the last three years, you have not seen this volatility because, as I said, at the end of the year, a little bit by coincidence, the working capital has been relatively stable year after year, when we know that there could be some large down payments or large advance payments, which could lead to some much greater volatility. There is no such a phenomenon that you are describing of negativity on one year and then positivity on this year. Just one point on this year, you have not asked the question, but you could be surprised by the high level of order intake and the low level of down payment.
You need to know that service order intake has no down payment, so it explains why there is actually to start with EUR 3 billion of order without any down payment. It happened that the APS trains in France have no down payment as well. Out of the EUR 12 billion, you have EUR 6 billion of contracts with no down payment. This explains why, if you look precisely, you will see a very low level of down payment this year. Again, this does not generate mechanically a reversal of this situation in the coming year, in this year. In terms of CapEx, I will give the floor to Laurent, but you need to take into account some change, a little bit of accounting on that respect.
Yep. Jonathan, in terms of CapEx, for 2019, 2020, to give you some colors. Indeed, we'll be completing the transformation CapEx, which is the setup of industrial hub. That will be completed in 2019, 2020. From there, we are not opening any new industrial hub, our industrial footprints hub strategy is completed. However, we'll be increasing the capacity on the existing industrial hubs. This will come as well with some CapEx, for sure. Finally, indeed, there is now in IFRS 15, the specific CapEx tools which are related to specific projects which are accounted for in our CapEx, that will have, as well, a limited impact in our CapEx profile for 2019, 2020 onwards. We'll give you more colors in terms of the numbers, but these will be the drivers for 2019, 2020.
Thank you, Laurent. Next question, please.
Thank you. Yes, the next question comes from Alfred Glaser from Oddo. Please go ahead. Your line is open.
Yes, good morning. I wanted to ask you on first, your acquisition policy. You will keep about EUR 1.1 billion of net cash once you have paid the dividend. What is your take now on the acquisitions you might want to do? Then second, I wanted to ask you on pricing, how do you see currently pricing evolving in the market, in your order intake and in the tender offers you're working on?
Thank you, Alfred. what we do today with dividend distribution and what was going to be proposed to the general assembly is in line with our general policy, which is first and foremost to have a strong balance sheet. We keep a very strong balance sheet, both in terms of net cash and in terms of equity. This is, as you know, one of the fundamental items of our business model. Two, to keep some rooms of maneuver for external growth. As you know, following the Siemens-failed merger, we want to redirect our strategy towards more probably partnerships, smaller acquisition, bolt-ons acquisitions. We think that we kept in hand what was necessary to sustain the strategy going forward. Again, we'll be more explicit at the end of June. In a minute, we don't expect extremely large acquisition.
We don't have that on the pipe today, but we expect more bolt-ons activities and bolt-ons acquisition, which are totally enabled by the level of cash that is sitting on our balance sheets. In terms of pricing, we don't see there is no real evolution of any prices or the competitive behavior of the market, of our competitors. We see, as I said, in the past, a continuous pressure on the prices, and we are in an industry where prices are under pressure continuously. We are not in a cyclical industry where you have prices moving up and down depending on cycles. We are in an industry where it's more, I would say, an average pressure on prices. I cannot say that there is a particular pressure coming from somewhere, both geographically or from a particular competitor. Okay, thank you, Alfred. Next question.
Thank you. Our next question comes from Magnus Gruber from UBS. Please go ahead.
Hi, Henri, Laurent. Magnus here with UBS on behalf of Guillermo Peigneux. A couple of questions from me. First, would you say that your underlying order growth this year, X, the large project, is reflective of the current market activity? Do you see the market activity remaining on this level you saw last year and through this year as well?
On order intake, yes. The underlying, I would say mid-size orders are in line with the market activities. We need to have, as I say, our growth is fueled as well by one large order per year, or one or two large orders per year of significant amount. This year, I don't know if you count Montreal one, TGV, Riyadh maintenance is also a very large one. There are maybe two to three. In terms of mid-size orders, this is more, as you said, the classical reflection of the market dynamics. There is nothing exceptional in the market itself, but it's just happened that Alstom has had an exceptional level of large orders this year.
You had another question maybe?
No, this is okay.
Okay, thanks.
Thank you. Next question.
Thank you. The next question from Andreas Willi from JPMorgan. Please go ahead.
Good morning, everybody. I have two questions on the balance sheet side and the dividend. How did you determine in terms of ordinary dividend versus a buyback or OPRA? What drove that decision? Secondly, in terms of your bonds that you still have outstanding, do you plan to buy them back and then run the company basically without any long-term debt in the future?
We've been looking at all the options in terms of distribution mechanism. Indeed, Andreas, we believe that this dividend distribution was the more appropriate mechanism. Looking back, we'll give more colors as well in terms of the upcoming capital allocation and shareholder returns in the capital market day on the 24th of June. Indeed, of course, dividend policies, shares buybacks are considerations that we'll be explaining in our capital market day end of June.
Thank you, Laurent. Further questions?
No further questions, sir. At this time, I'd like to turn the call back to yourself for any additional or closing remarks. Thank you.
Thank you, operator. Thank you all of you for your time. Happy to meet you soon. As a general conclusion, I would say that this has been an extremely good year, I have to say, another one. We of course, still need to continue to work to improve, but it has been a very good year. Although we tend to forget now, it seems to be a long past, but we should recall that this year has been marked by this project with Siemens, and I'm particularly proud of our teams and our colleagues, which have delivered this performance at a time where they could have been perturbed by external events. Thank you for that, and happy to talk to you soon. Bye-bye.
Thank you. This concludes today's conference call. Thank you for your participation, ladies and gentlemen. You may now disconnect.