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Finmeccanica says still talking on asset sales
MILAN |
MILAN (Reuters) - Italy's Finmeccanica (SIFI.MI) is still in talks to sell non-core assets, likely to include transport and energy businesses, despite long delays that have frustrated investors and prompted credit rating downgrades, its chief executive said on Thursday.
The state-owned group missed a 2012 target of raising 1 billion euros ($1.3 billion) from disposals, hampering efforts to cut debt and focus on its aerospace and defense businesses.
"I understand it is frustrating to see we have not yet completed a number of transactions," CEO Alessandro Pansa told analysts in a conference call about second-quarter results, which showed a 24 percent drop in orders and a net loss.
Pansa said the talks were an at advanced stage and he "was confident a proper solution can be found in a relative span of time ... I'm asking you to trust in Finmeccanica management."
At the end of 2011 the company, Italy's second-largest private sector employer, singled out as non-strategic its transportation and energy assets, which include loss-making train maker AnsaldoBreda, its rail technology affiliate Ansaldo STS (STS.MI) and power engineering company AnsaldoEnergia.
In July, Fitch cut Finmeccanica's long-term credit rating to junk, citing a weaker market outlook and delays in the disposals plan. Fitch was the second rating agency to cut the credit rating for the debt-laden group to below investment grade after Standard & Poor's in January.
Analysts have said downgrades to junk could impact the ability of Finmeccanica to receive pre-payments from customers and harm its competitiveness outside Italy.
In the second quarter Finmeccanica's orders dropped 24 percent to 3.2 billion euros, missing market expectations and sending shares in the company lower on Thursday, while provisions on a Belgian train contract and higher restructuring costs dragged the company into the red.
During the call, Finmeccanica executives said order intake would pick up in the second part of the year, enabling the company to achieve its full-year guidance of 17 billion euros.
"In July we made up much of the shortfall in energy and transportation orders. And some major additional orders were signed after the second quarter," Gian Piero Cutillo told analysts.
At 1013 GMT, Finmeccanica shares were down 1.48 percent at 3.87 euros, the biggest fall on Italy's blue-chip FTSE MIB index, which was up 1.14 percent.
(Reporting by Danilo Masoni; Editing by Mark Potter)
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