View of Haliade 150 offshore wind turbine at Alstom\'s offshore wind site in Le Carnet, France (Reuters)

Faltering French engineering firm Alstom is to cut more than 1,000 jobs worldwide as part of a major cost cutting programme.

The manufacturer, which produces capital goods including turbines for power plants and wind farms, is to make the move following a fall in orders which hit the company's first-half profits and cash flow.

Alstom booked €9.4bn ($12.7bn, £7.8bn) worth of orders over the six months to October, a 22% drop compared to the first half of last year.

But sales for the firm were up 4% organically, amounting to €9.7bn, over the same period.

However, the firm saw a negative cash flow of €511m over the six month period, much more than analysts expected.

"In markets that remain contrasted, our commercial activity in the first half was supported by a good flow of small and medium-sized orders, but lacked large contracts, notably in thermal power," said Patrick Kron, Alstom's chairman and chief executive officer.

He added: "We want to regain strategic mobility and have launched an asset disposal programme."

The company said the dramatic cost-cutting programme will create 1,300 job losses, mostly in Europe, and it hopes to raise between €1bn and €2bn from the plan.

Alstom may also sell-off a minority stake in its train unit, Alstom Transport, which makes high speed trains, among other things.

The firm was bailed out by the French government a decade ago and has relied on orders from state rail operator SNCF and utility EDF Energy.

The company is now on a possible collision course with the French government.

Alstom has not replied to a request for comment at the time of publication.