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[Audio Gap]. Please go ahead.
Good morning, everybody, and thank you for coming and listening to us. We are here to present the first quarter of 2024. If we start with a small summary, we say that we have had a quite positive start of 2024. We have had a good sales mix, and that includes increasing portion of service aftermarket business. And we have, by that, it comes to a slightly better result, the margins are increasing. For the rest quarter 1, we have had a stable performance, and this is in an increasingly uncertain market, but we we have been able to keep up the order intake. Healthy orders received. It's actually the second highest quarterly order intake ever. So we have good performance here. Margins are higher, solid cash flow, and we are continuing advancing with new product launches, and we do have a stronger presence in a growing industry, and we have also invested in increased capacity and efficiency in different areas.
If I move on to Slide 4 and start my summary of the key financials. Orders received, currency neutrally, they increased 0.8% compared with Q1 2023, which was obviously a very strong quarter. Like so I mentioned, is our second highest quarterly order intake ever. Organic growth, very slightly negative. We have the acquisition of Aagaard in 2023 that has contributed some of the growth here, too. But the currency neutral, plus 0.8% and over that SEK 1.5 billion mark. When it comes to sales, sales were lower than orders received, but just below SEK 1.4 billion , SEK 1.397 million, which is a decrease of currency-neutral and organically. The main reason behind that, and this shouldn't be a major surprise in terms of the Process Technology division is that they have had lower order intaking back in the last couple of quarters. And therefore, they are the biggest contributors to the decrease. Like, I'd say, over SEK 100 million less in sales than orders means that our backlog of orders has obviously increased. Profitability-wise, we mentioned the margins are improving. We've invested in production and logistics, which made a positive contribution to profitability. There's also a favorable sales mix. And we could say between the divisions in respect of the most profitable divisions are those that are contributing more of the overall portion of sales. The final part is that the service business continues to grow, which is a more profitable part of our business as well. For the first quarter, adjusted EBITDA was SEK 174 million versus SEK 173 million last year, which gives an EBITDA margin of 12.5% versus 11.7% and profit after tax, SEK 90 million versus SEK 78 million in the same quarter last year, and that led to earnings per share of SEK 2.57 versus SEK 2.22 in Q1 of 2023. When it comes to cash flow and net debt. Cash flow from operations in the quarter, SEK 95 million. It was behind the Q1 of last 2023. But it must be pointed out, this is the second best, again, I said the second, but second best quarter 1 for cash flow from operations that Nederman Group has ever seen. This is rather pleasing, and some of that comes down to the order intake where we have received some down payments on larger projects. Net debt is clearly significantly lower than it was at the same point 12 months ago. If we go into the divisions, [indiscernible], Sven we start with Extraction & Filtration Technology.
Yes. Extraction & Filtration Technology, midsized project focusing on compositive wood, welding, other general gas application, et cetera, just for reiterating where they are coming from. The development during the quarter can say that we had better orders received. And there has been several major orders and that is including solutions in areas like green energy, transport, waste management, substituting some of the weak demand in the other industrial segments like welding and some base industries that are not so eager to invest at this time. Base business has been in line with the 2023 first quarter then. And what is very satisfying is we continue to build our aftermarket business also in this division, and we had double-digit growth also this quarter. The backlog remains high, and that is a good foundation for sales development in the coming quarters. It's probably not taking too long because they are having 1 to 2 quarters visibility here. First orders booked in Americas for the energy-saving system save, who is now getting more and more traction and it differentiates us from other suppliers that we also have our digitalization becoming an increasing part of our offer. We have continued, of course, to book also in EMEA. For different reasons, we have not launched this in Asia and China since it's a key digitalization part of it. Regions, EMEA, higher volume, positive sales mix, efficient project deliveries and all this together has improved the profitability and share the bounce back as to where we want to be. APAC orders, generally weak solutions grew somewhat with medium-sized orders in China and in India, still not on a satisfactory level. America, as I hope, so flat of opening orders and sales versus Q1, but there's a solid order growth, including break for all the minimum sales system. Relocation of RoboVent, the company we acquired, #1 in Welding in U.S. We are moving the whole operation, not a far distance. It's in the same vicinity of Detroit, and we expect this to be completing during this quarter. It will increase capacity and efficiency definitely. But of course, there is a hard pressure on the staff doing this exercise during Q2.Other key activities has been the launch of the MCP purification tower, and it has generated a good interest from the market, and we have already booked the orders on that one. We have also started to get closer to the consultants by launching BIM Object platform. We have our pro ecosystem that helps us dimensioning the system and being more efficient and other investment in digitalization and efficiency. Now we make it even easier for the consultants and architects to position our product in a facility by using BIM Object. We believe that, that will further strengthen our position as the preferred solution.
When it comes to figures for Extraction & Filtration Technology, orders received were 2.7% currency neutral higher than Q1 2023 at SEK 616 million. Sales reached SEK 636 million, giving an adjusted EBITDA of SEK 103 million, which is a 16.2% margin, which is a clear improvement over the 14.5% seen in quarter 1 of last year. On to Process Technologies, Sven.
Yes, Process Technology, where we deliver larger projects, especially the world leader in textile foundries and smelters, but also in other areas like waste recovery and metal scrap recovery, et cetera. During the quarter, we had a drop in orders received, but it was still very strong. It's something that we anticipated and talked about in earlier quarters. As expected, also the sales decreased compared with a very, very strong Q1 last year. Profitability remained high with a positive sales mix and good efficiency in execution of our project. And again, our efforts to grow the service aftermarket business continued. And that helped to keep up the good margins. If we look at textile fibres, orders received and sales decreased significantly compared to 2023. The capacity utilization in spinning mills is low, and that is curbing the demand for new equipment and especially so in China. It's the world's largest textile market, but the demand currently is weak. India remains more stable, both in India, but also in the neighboring countries where we export them. The innovation that we launched in 2023 at ITMA continues to generate additional business. It delivers a significant energy saving, and it's a part of our theme in the different divisions producing products that can save energy in different ways, and we've seen a very positive interest in these new innovations. If we go to foundry and smelter, for the segment as a whole, orders received and sales decline compared to the strong Q1. However, a strong sustainability trend is contributing to an increase in demand for solutions in example -- for example, metal recycling. And then we are talking here about magnesium. We are talking mainly on aluminum, but to a small portion also in the ferrous metals or something. There was one major order book for a smelter project in EMEA.When we come to customers customized solutions. We had a strong order growth, and it was quite a few orders that were booked especially in Americas, and we are talking here about recycling of material mainly. Activities. We continue to strengthen our efficiency, not also in this division. We have installed new equipment and lasting, painting in our main facility in Friesenheim South Germany, and that will increase both capacity, efficiency and therefore, also since we're using more automated processes a lower cost and making us even more cost competitive. The restructuring program in China has been completed.
Briefly on financials for the Process Technology division. Orders received were SEK 486 million, which is 7.7% currency-neutral land organic down on last year. However, still rather strong, this is, I won't call it a surprise, but pleasing to see sales, as we've mentioned already, clearly lower than Q1 last year as expected, SEK 392 million. The adjusted EBITDA due to the favorable mix with more service business and higher-margin projects as well, was SEK 32 million, which gave them a margin of 8.0%, down slightly from 8.3% in quarter 1 last year. Now on to Duct & Filter Technology expand, Sven.
Yes, Duct & Filter where we supply duct work for specialty applications with heavy dust loads and suppression system and also filter technology filters for our internal and external sales as well. For the quarter, we can say that orders received and sales decreased slightly compared to the strong 2023. New orders were secured in what we call growth segment, battery manufacturing, to green energy especially so that we are entering into this market as well. Profitability was strong, and that's primarily due to improved manufacturing and inventory processes in the U.S. factories. And that is a result of earlier investments, especially in RoboVent's plant in Thomasville where you might recognize that we increased the building side. We have added new even modern equipment, and we have our solar panels making us be North Carolina's largest private supplier of sun solar produced electric energy. Leaving that and going into Nordfab specifically, Nordfab performed very strong as we say, in orders and sales. EMEA and APAC were slightly weaker, and profitability developed well following the investments in the production. And in early April, the Nordfab Now concept was launched, offering delivery of selected range within 24 hours. So we are adopting to the trend of Internet trade and so on and people not wanting to wait for that good. So we have a new concept indeed officially on and it attracts good reviews from our customer base. In Menara, orders received declined versus the previous quarter as well as versus first quarter in 2023, but it remains a historically good level. New orders were secured in competitive cement industry and also in some others. So the key activities during Q1 was Nordfab Now, and it was officially launched on April 8. They digital quotation and order tool, QTO was launched also in Australia. If you remember that here, we acquired some building up our facilities also in Australia. The implementation of BIM Object mentioned also in EFT will further help consultants architects to make life easy for them. And that is something we continue making life easy for easy to do business with. We have internal saying that our target is to easy -- Nederman should be easy to do business with. And we have also upgrading plan production in Thomasville and more continuous improvement and investments going in there to further strengthen the manufacturing site and distribution.
External orders received decreased by SEK 9 million 4.2% more the division in quarter 1 Nordfab Menardi down, is what we could say there. Sales, SEK 207 million, slightly below last 2% only down. But the adjusted EBITDA due to the improved margins and efficiency in production, SEK 42.6 million, higher than 2023 Q1 gate and a bit of a very healthy EBITA margin of 20.6%. On to Monitoring & Control Technology now, Sven.
Yes, monitor control technology for surveillance as well as for monitoring particle gases, et cetera. So if we go from the development during the quarter, it's been the highest ever order received for a single quarter, and it's been particularly strong with Gasmet. We had very good traction with our latest launched a portable emission analyzer GT6000 Mobilis.New orders securing biofuels industry and for the cination of medical waste there. Sales increased compared to '23, and that was the largest growth seen in NEO moto. Profitability was negatively impacted by more solutions side and the less favorable mid [indiscernible]. What also created problems was the finished strikes that made life more difficult for us, and there was all sort of things. We can find all kinds of explanation of Easter blocking some of the things in Norway. But if we look at EMEA, orders received increased both Gasmet and NEO. There was a strong order intake in Gasmet, particularly in our setup in U.K. and Germany, and we have also good steel growth. But as mentioned, the strike in Finland generated issues for us in March. In APAC, orders received increased again versus versus last year's Q1. However, the sales were flat partly due to supply issues here.
We are to develop the division distribution sales agents in China is generating clear results. We are about -- we set up a service center. We are about to set up centers so we do not have to send equipment back to Europe here. In Americas, we have noted slightly lower orders received, but another strong sales quarter. We participated in NEOs for the petrochemical industry. And so good interest for Neo monitors and new developed products. Sales grew from both NEO and Gasmet, but AFS had somewhat of a decline. Key activities, investment in production capacity for Neo. We have passed emission analyzer certification field tests that will further broaden the use and the applied market we can go to. Nederman Insight was renamed OTC, and that's the preparation for new product generation have started. Financials for Monitoring & Control Technology. As financials orders received the highest ever single quarter for orders received SEK 234 million as a 23% growth versus last year, sales hampered a little bit by a couple of -- for a couple of reasons, which you've heard, SEK 187 million still actually higher than last year. But this mix has impacted the margin, and we ended the adjusted EBITDA was SEK 28 million versus SEK 33 million in quarter 1 last year. That's a margin of very nearly 15% versus 19.3% last year. If you just look at the outlook and some other information then.
Yes, the outlook, we would say that demand and orders received remained fairly solid, while our base business and strong digital rates enable us to assert ourselves well in the current market. Division performance remains positive. There is a high inflationary pressure weaker economic outlook will impact customer investment decision. It does remain, and it's also a high cost inflation -- salary inflation pressure around the globe. There's a growing year political uncertainty. And of course, if you want to be next, that could increase to further protections and so on. But in view of our large order backlog and our ability to increase our share of sales in the industries with good structural goals, we take a cautiously positive view of opportunities for the year, and we see that we are continuing to strengthen our position. We have a very good offer, attractive offer, a mix of digitalization, mix of efficiency, trading solutions, easy to do business through B market, ProQuote, QTO, et cetera. So reasonably optimistic for the remainder of the year. Some other information, we committed to the science-based target initiative there and doing this scope 3 analyzes 99% on Nederman's greenhouse gas emissions, to the user phase. That means that product innovation cooperation with customers will remain the main focus moving forward.
Just shortly on the financial calendar, the Annual General Meeting is tomorrow the 26th of April 2024 for those that are unregistered. The quarter 2 report is released on 12th of July of this year, quarter 3 on the 22 of October this year, and the year-end report for 2024 is released on the 13th of February 2025. And with that, I think we can open up for any questions that listeners may have.
[Operator Instructions]. The next question comes from Lina from Blume.
This is Lina Blume from Handelsbanken. So my first question is related to demand. It seems like the momentum that you have in Americas or more specifically, the U.S. is continuing to be strong. What is your current view of the development in EMEA demand wise? And maybe if you could talk a bit on if you have any expectations of that going forward?
Yes. It's almost like Henry Kissing says, who do I call when I want to talk to Europe. And it's a very scattered picture where you have reasonably good demand in some countries, it's been weak, especially in Germany and in Scandinavia, Sweden, for instance, you've seen the economy has not been grown that well. Having said that, we have seen also in some areas, wood application, and that is coupled a bit to less investment in furniture and some from private people. So that has been -- so Europe is it's a mixed bag. Then if you go to some of the recycling if you go to yes, different, more structural businesses. There is a reasonably good demand. So I'm not too negative. It's been I think, and now I'm not a national an economist, but I think that there has been in Europe for a pushback for industry serving the consumer and construction industry and that we've seen lower demand and in structural areas of green energy recycling. So we see very good demand. So it evens out a little bit here. I'm not too worried about it in the medium term.
Super. That's clear. And then you report a weaker development in the APAC region. Could you give us some information on China versus India during the quarter?
I can maybe answer a little bit on that. In APAC, our largest segment in APAC is the Fiber and Textile business, obviously. And that is rather different between India and China right now. For a number of reasons, I think it's now down to some domestic demand issues in China. But then also the Indian government had been incentivizing investments in the textile industry as well. And so that has meant that there's a rather different picture there. When it comes to other parts of our business, monitoring and control technology continue to perform rather well. This is where we have a high-tech products that have no local competition. We are measuring, for example, at much lower concentrations on certain gases than any other companies can do. And that means that that was why we continued the strong growth in Asia APAC for monitoring and control technology division. So a little bit of a nuanced picture. But China certainly not from an industrial perspective, it's certainly not as half of the U.S. right now.
China is a mix -- it's a mix that there is a significant overcapacity in all manufacturing in China for the moment, which has generated difficulties for China. We are, however, very small in the Chinese market, and we should be able to do a little bit more. But now also restrictions we put on ourselves that we are not launching some more advanced digital solutions for reasons of legislation in China that could generate a significant problem for us on IP rights, et cetera. So we see that it's a mix of weak textile where we have the strongest position, very strong demand for measuring technique and MCT. We could sell even more if we could get the organization as supply chain in there. So it's a mixed bag here. There is a very strong demand for the high, high-end products that we have. They would probably like to have some of the digital product that we have, which we will not sell us. So it's, again, India, very dependent on the development in our fiber technology, textile and they are doing quite well, both in India and in the surrounding areas. We have a very solid performance in our business there. We are working also with some of the other areas, how to handle that. You had the same problem as you have had in other areas with India, and that is Made in India. And that means that they have strong orders when it comes to custom tariffs and then they support the manufacturing in India. And since we have a large manufacturing base for the Textile segment, that goes very well. We are contemplating how to get insight in some other areas as well. But it's something we love to be considered here. But we are also building out the engineering capacity in India. So we have engineering capacity that is supporting, especially process technology on the global draft when doing the -- a lot of the -- yes, again, generic work that's needed for audio project. And by that, we are both increasing the competency in India, but we are also saving costs not going via any consultant firms. So again, it's a mixed bag here.
Super. And then it seems like the demand is continuing to be strong in industries such as green energy, battery manufacturing and recycling. But what is your view of the demand in the more traditional industries such as textile, as I mentioned, welding, wood and paper? Is it possible to say if we are seeing any recovery in these industries? Or is it too early to draw conclusions?
I think it's too early to draw a conclusion. We believe that we see that we -- there is a lot of restructuring in Europe. For instance, they are tripping factors in -- they try to concentrate on fewer sites. But that is not all bad for us. We sell the safe concept. We get in for the aftermarket and so on. But I would say the demand is so-so, but we believe that we are increasing our positions here through -- especially on the high end. On the low end, we are not there. But in the high end, we see that there's an increasing interest for our what we call future-proof solutions with energy savings, composed systems, efficient supply of the filters, et cetera. So I think it's very difficult to say. But I don't think we will see a dramatic downturn. I think we will maybe wobble in Quarter 2 in this, but I'm very positive that Netherlands will come out stronger in this environment.
Super. And then in Process Technology, you report that geopolitical turmoil and weakness in surge markets is expected to yield lower orders over the next few quarters. Should we interpret this as you expect lower organic sales growth or even negative organic sales growth in division in the coming quarters?
Process Technology division still has a reasonable backlog. They've had a very good quarter this quarter. So it's a little -- it's too early to be too depressed on there. They're not at the high levels that they were 12 months ago. So you can't expect SEK 600 million-plus quarters for sales for that division anytime soon. But they almost reached SEK 500 million in orders in quarter 1. That was -- we saw that as positive. And so in the short term, it's not too bad. There's less long-term visibility in process technology, however, than it was 12 months ago.
Well, I don't think you should be only negative in this. So we are growing the aftermarket very rapidly. We had a very interesting concept our combination of MCT PP solutions is getting more and more known in the market. And we also see that there are a pipeline of some large projects that might go ahead. It's more that people are sitting and waiting to put the paper. I wouldn't be too depressed. I think we will have a balance, but might maybe not reach the height we had last year with.
Super. And then on the profitability, you reported better profitability in this quarter compared to the first quarter of last year. Are there further room for improvement on the margins? And what will be your main focus going forward to reach your target on EBITDA margins? And would you say that the better sales mix with the larger service business is sustainable going forward?
Service business, we -- part of our strategy is to continue to grow service business faster than -- faster than the rest of the business over a sustained period of time. But there can be volatility and booking large -- that doesn't mean we're going to say no to the large projects when they come along either. Then the other part is if we look a little bit more short term, we could say for a number of reasons, monitoring and control technologies, sales were not quite as high as they ought to have been a they've been higher, that would have helped the margin further. So that's probably where the short term ARE, but those are the 2 main arms, growing monitoring and control technology faster than the rest, but also the service business to grow that faster over the sustained period of time.
But I think it's a midterm, long-term answer to this. There is obviously, since we have a target of 14%, that's obviously grew for improvement. It is a mix, of course, of growing sales. It is this value-based pricing that we are continuing to develop and not being shy getting paid for our superior solutions. It is also all the investments we have made and are continuously making in the supply chain, both manufacturing, but also how to handle better than logistics. And we see the very good development investment in the -- over the last decade in a Polish factory. We are Friesenheim in the European. We are adding capacity also in Danish. We are moving to a new, more efficient site in Helsingborg. We are moving, as we speak, the Goberman plant from a free divided site into one modern facility. We are continuously investment now in automatic storage in Thomasville for the new fab business. So it's a mix of small -- it's not one big revolution. It is what we've been doing over the last decade, small incremental changes in the direction where we can push up getting better paid for our product as well as having a better efficiency. We shouldn't forget the efficiency internally with the proquote, the different B Mobilis and whatever, using digitalization, it's a very wide expression but using the technology to be more efficient also in administration. So it's small things, but it's -- so it was a very long excursion to say, yes, there is room for more. Having said that, I do not promise that to come next quarter, but we are moving gradually forward.
That's very clear. And then more generally speaking, is it possible to say what share of sales that are sort of new customers? And what share is replacement of already existing products?
No, we don't have an answer to that. That would be too much of a guesswork.
Okay. And then just one last question from my side. We are happy to see that you have committed to the size-based target initiative. Could you go over the process for you going forward? Or sort of how close are you to actually submitting a target and so on?
I can answer that one. We are very, very close to submitting the targets. I have a meeting actually next week with our sustainability managers. So it will be within -- we'll be submitting within weeks -- and maybe to next interim report they buy next interim report, it will have happened. But then there's a validation process as we understand it, there's an awful lot of companies that submitted right now, so that can take some time. But I mean, this doesn't change the work that we're doing anyway. The 99% of our footprint is the customers the CO2 footprint is customers use. And we knew that, that this is -- for us, this has been a key for a long time. This is why there's such a business benefit from reducing the energy that's utilized by our filters and our solutions. These funds in process technology, for example, the energy -- the save in the Extraction & Filtration Technology, we are going to keep working with that. And that's the key to achieving these SBTI targets, but it's not necessarily because of the SBTI targets, but we will be doing that. Of course, it helps contribute towards it, but it will also contribute towards our business becoming more profitable as well. We give our customers better solutions that use less energy. They are happy and so are we.
And that's something -- that's not new. That's what we've been working with over the last decade to do this. And it's also so that we have already, again, over that decade worth a lot to lower our internal use of energy. And it's, in fact, that for the last 10 years, we have decreased our own internal use of energy, electrical energy with 70%, 71%, I think it was. But, so it's nothing new. This is more an administrative thing that we, yes, we submitted this. It's been in our way of working as an environmental technology company. We are focusing in driving down energy use, be more efficient in all things what we are doing.
[Operator Instructions]. There are no more questions at this time. So I hand the conference back to the speakers for any closing comments.
We thank you for taking the time listening to us, and we will be back in the same if you tune in July, and you will have the Q2 report then. So thank you, everybody, and have a continuous good day.