Hello, and welcome to the SPIE full year 2023 results call. Please note this conference is being recorded and for the durations of the call, your lines will be on listen only. However, you will have the opportunity to ask questions at the end of the call. This can be done by pressing star one on your telephone keypad to register your question. If you require assistance at any point, please press star zero and you will be connected to an operator. I will now hand you over to your host, Gauthier Louette, Chairman and CEO, and Jérôme Vanhove, Group CFO, to begin today's conference. Thank you.
Good morning, ladies and gentlemen. Thank you for attending this conference for the full year results of the year 2023 for SPIE. So maybe I'll start with my usual conclusion. It's never been a better time to be an electrical engineer, and 2023 is definitely a record year for SPIE. We had an exceptional level of organic growth at 8.4%. This is a strong momentum in our markets, and we've been able to increase prices in an inflationary context.
We had a strong EBITDA margin increase at 40 basis points compared to 2022, 6.7% of revenue. This is better than our guidance. It evidences our innovating focus on operational excellence and even higher selectivity in the context of strong demand. And indeed, we reached two years in advance our 25 EBITDA margin plan.
We had an exceptional level of free cash flow with 109% cash conversion. Our leverage reached an all-time low at 1.2. We did execute brilliantly our bolt-on acquisition strategy, which, as you know, is at the core of our business model and is very value accretive. And finally, we continued to lead the way on sustainability, SPIE being one of the best-in-class performer with 48% of revenue aligned with the EU taxonomy.
It does showcase how strong we are as a key enabler for energy transition. And looking ahead, we are very confident to deliver yet another strong year in 2024. On slide 5, our financial highlights. I'm really pleased to report an outstanding set of numbers. Revenue is now getting close to EUR 9 billion, up 8.4% organically. EBITDA nearing EUR 600 million.
EBITDA margin improved by 40 basis points. Our free cash flow increased by 36% to reach EUR 427 million, and our leverage ratio was down to 1.2. Bolt-on M&A has been very active during the year, as expected, and we are very pleased with the nine acquisitions announced, representing around EUR 700 million in annual revenue.
F inally, our adjusted EPS grew by 14.2%. We will recommend a dividend per share of EUR 0.83, up 13.7%. On slide 6, in 2023, SPIE's organic growth was at 8.4%. This is a record level for the group, despite a very high comparison basis, especially in Q4. We had a 10.2% organic growth in Q4 2022, which we compare now with a 5.5% in Q4 2023.
Definitely, 2023 has seen a very strong momentum in our market, and we also enjoy the higher price effect in an inflationary context. On slide 7, in 2023, all our segments recorded a material increase in EBITDA margin. France, Germany, and Central Europe, and also Global Services, Energy and Nuclear, received a strong 20 basis points improvement. Northwestern Europe delivered an outstanding performance with a 90 basis points margin improvement. This is mainly thanks to the Netherlands.
The disposal of our UK operation means 40 basis points on the segment and 10 basis points at group level. The region enjoys a now 5.9% EBITDA margin. It did catch up with the best-in-class margin performance of the group. Overall, the group's EBITDA margin grew again by 40 basis points, exceeding our guidance and reaching two years in advance our 2025 targets.
The stronger personal performance reflects our strategic focus on profitability in the context of strong demand for our services and labor scarcity in our sector. Moving to slide 8, in France, we enjoyed a 5% revenue organic growth and a 20 basis point EBITDA improvement. All activities were well-oriented.
Tech FM was driven by the constant demand for energy efficiency solution, more technology per square meter, and the need to adapt office spaces for the new usages. Industry services were supported by decarbonization and reindustrialization projects. CityNetworks has seen acceleration from the low carbon mobility sector, with increased demand for urban transport, smart lighting system, and e-charge system for electrical vehicles. Finally, ICS has expanded to hybrid cloud solution, as well as unified communication and cybersecurity solution.
On slide nine, Germany and Central Europe, we did see a strong momentum across the region, 8.2 revenue organic growth, 20 basis point EBITDA improvement. Germany alone recorded a 5% organic growth and a 10 basis point EBITDA improvement. High voltage activities, they did accelerate in H2 as expected.
We do enjoy an excellent mid- to long-term visibility in this field, thanks to the substantial need for integrating renewables into the grid and for the upgrades of the transmission lines. For TechFM and CNGs, we see similar drivers as in France. And finally, ICS was supported by unified communication activities and digitization projects. Maybe it's worth mentioning for CityNetworks & Grids, that we do see an acceleration on the fiber market, which is so far lagging behind what we have seen in other countries.
To conclude on Germany, let me remind you that activity in Germany mainly relates to energy efficiency and to the massive structural change in energy mix, and we definitely had a very strong year in Germany. In Central Europe, we've seen a double-digit organic growth, particularly in Poland and Austria, where our acquisitions are performing extremely well on top of a good dynamics in all our markets.
Switzerland has benefited from a catch-up of ICS activities following prior supply chain delays. Northwestern Europe, we've seen an exceptional level of organic growth at 13.1% and a significant increase in EBITDA margin, 90 basis points, including the relative impact from the UK disposal and significant progress in the Netherlands at both historic perimeter and building solutions for former Worksphere.
All sectors in the Netherlands experienced outstanding organic growth, especially in high voltage activities and industry service, where the year was absolutely excellent. Building solutions remain very dynamic, with increasing demand for complex and sustainable solution. The margin progress since acquisition of Worksphere is remarkable. Belgium's activity was fueled by high voltage projects, while building renovations and maintenance were well-oriented, and industry did well.
Now, on slide 11, Global Services Energy and Nuclear. We recorded an organic revenue growth of 13.5% and EBITDA margin improvement of 20 basis points. We experienced a very strong momentum in oil and gas, thanks to our strong position in Africa. We also benefited from the ramp-up of a contract in Denmark. Pluriannual contracts are providing good visibility. Our EBITDA margin progress further from a high level, and we see a really good trends for the year 2024.
Now, with the acquisition of Correll Group, we have renamed our oil and gas division to Global Services Energy, to reflect our growing position in the offshore renewable activities. In nuclear services, the activity did remain constrained with the repair of the wells, which has entailed some disruption in the maintenance program.
It's now progressively returning to normal, but we see we enjoy a good mid- to long-term visibility, thanks to the new repair programs, which have been launched and confirmed by the French government. We do continue to see a high level of EBITDA margin in this sector. Regarding the acquisition on slide 12, as I said, we had a very active year in 2023, nine acquisitions totaling more than EUR 700 million of full year revenue acquired, including ROBUR, which positions a group in industrial services in Germany.
This was something we have been pursuing for quite a while. Both on M&A strategy remains at the core of SPIE growth model. It does contribute to the expansion of the group services and the footprint density. Our active approach, combined with highly fragmented markets where we're operating, does offer a rich pipeline of future M&A opportunity, and 2024 should be no different.
Looking at shareholding structure on slide 13, we are a service company. Our employees are our most valuable asset. SPIE stands out as one of the seven company on the SBF 120 index, where employees are the largest shareholder of the group. Our shareholding structure highlights a significant 9.2% owned by SPIE employees and management, 7.4% attributed to employee funds, and 1.8 to management.
We're also very pleased to have two anchor shareholders, Bpifrance at 5.5% and Peugeot Invest at 5.1%. Last year, we had a big success with our SPIE employee sharing plan, Share For You 2023. More than 17,000 employees from 14 countries participated. This is a 50% increase compared to 2022. And notably, over 5,000 of these participants are first-time shareholders in the company.
We are really pleased with this result. It's really important for us to associate our employees with our long-term value creation. And speaking of long-term value creation, maybe to conclude this section, let's take a step back and look at our progress since IPO. Our model does deliver. It is based on cash generation and M&A compounding. We had an outstanding performance in all respects.
It does confirm the unique positioning of SPIE on accelerating markets, combined with a margin over volume approach and a sound financial structure, which has always allowed us to further extend, to fuel a profitable growth and self-finance bolt-on acquisitions. Now, we'll hand over to Jérôme, who will comment on our financial performance.
Thank you, Gauthier, and good morning, everyone. I'm on slide 16 with the highlights of our income statement. SPIE has demonstrated an outstanding financial performance in 2023. Let me outline our key figures. EUR 8.7 billion of revenue, with an exceptional organic growth of 8.4%. EUR 584 million of EBITDA, a significant increase by 14.3% versus 2022, including a strong EBITDA margin increase of 40 basis points at 6.7%.
The adjusted net income saw a significant rise to EUR 344 million, up by 14.2%. The adjusted earnings per share stands at EUR 2.05 on a fully diluted basis. These figures underscore the strong financial performance of SPIE in 2023.
Moving to the revenue bridge, we have achieved a significant growth in 2023, with first, an exceptional organic growth of 8.4%, as said, obviously, including a material price effect in a context of higher inflation. M&A added only 2.4% to our growth for FY 2023, as most of, most of our acquisitions of last year were made in the second half of the year. Disposals had a negative 3.1% impact.
This is due to the sale of our operations in the UK at the end of the year 2022. Net currency effect remaining negligible. Thus, a total revenue growth of 7.6% for the year. Now, looking at the bottom part of the P&L, our adjusted net income increased by 14.2%. This is in line with the increase of our EBITDA.
Into more details, the contained net interest reflect our optimized debt profile, of which more than 80% is at fixed rate. Other financial charges, they are mainly driven by the interest cost on our Germany defined benefit pension schemes, that increased significantly due to the rise of interest rates over the period, as well as a negligible net, FX effect in 2023, in comparison with the net gain that we reported the year before in 2022. Finally, on the income tax, our normative tax rate is down by 2.5 points to 28.2%, mainly as a result of the exclusion, from that, calculation of the French CVAE tax.
Now, breaking down the items to reach the reported net income, I will highlight the following: the very limited restructuring cost, all of them being related to the integration of our newly acquired companies. The amount of -EUR 0.5 million related to the ORNANE, our convertible bond, which includes circa -EUR 8 million of linear amortization of the derivative component, and on the other hand, circa +EUR 8 million related to the change in fair value of the same derivative component.
As a reminder, in H1 2023, we recorded accumulated IFRS charge of EUR 18.4 million, which corresponded to the current -EUR 0.5 million for the whole year. Considering its non-cash nature, it is restated in the adjusted net income, while the 2% yearly coupon cost remains included in the interest cost.
The other non-recurring items of EUR 41.1 million are mainly related to a, the non-cash IFRS 2 charge, linked to the success of our employee shareholding program, and the full vesting of our long-term incentive performance plans. And on the other hand, as well as higher acquisition costs, they are under IFRS 3 charge due to our obvious strong M&A activity in 2023.
You are now well familiar with this chart, showing our structurally negative working capital, and this over the years, thanks to our optimized contractual terms, the invoicing processes, as well as a good cash collection. Our working capital improved further by EUR 60 million at negative EUR 884 million at the end of the year.
This represents a negative 37 days of revenue at the end of 2023, bearing in mind that one day of working capital in 2023 has increased, so as to represent EUR 24 million versus EUR 22 million the year before. This is an excellent performance that did contribute to our outstanding cash conversion, along with a very good quality of working capital, notably with reduced working progress or accrued income.
Moving to the next slide, SPIE has achieved an outstanding cash conversion, as said, at 109%. It does confirm again, our long-standing cash generative model with an average cash conversion in excess of 100% since IPO. It underlined the high quality of our EBITDA performance. On the basis of this excellence, excellent operating cash flow, SPIE reached a record level of free cash flow of EUR 427 million in 2023.
Moving on the next slide. Our net debt decreased to EUR 793 million at the end of December 2023. This performance resulting mainly from, A, the operating cash flow of EUR 629 million, the well-contained cost of our debt, and as well as our optimized tax cash out, which benefited in 2023 from a deferral of circa EUR 20 million, which will be cashed out in 2024.
Thus, our free cash flow of EUR 427 million allowed us to, A, self-finance our M&A strategy, in which we engaged EUR 196 million of cash out. And I remind you that this amount still does exclude the cash out related to the acquisition of Robur and Correll, which is taking place only in the first quarter, 2024.
It allowed also for the payment of dividend for EUR 128 million, and also to the reduction of our net debt by EUR 127 million. Thanks to our efficient cash generative model and to our EBITDA growth, SPIE, SPIE's leverage ratio has reached an all-time low in 2023, at 1.2 times, this excluding IFRS 16 impact. Since the acquisition of SAG in 2017, we maintained the momentum by bringing down the leverage ratio, while self-financing 44 acquisitions over the same period.
It is a clear indication of our strong commitment to a solid and sustainable financial structure, providing with a significant headroom for our M&A strategy. This slide showcases SPIE's sound financial structure with a well-diversified debt profile, long maturities, and very attractive financing conditions.
As of the end of December 2023, 80%, 81% being precise, of our debt is at fixed rate, with the rated cost of our gross debt standing at circa 3.4% over the year. This does reflect the very attractive financing conditions we benefit from. We optimized our debt profile with EUR 400 million in ORNANE at a fixed rate of 2%, maturing in 2028, and further demonstrated our commitment to sustainability-linked financing.
SPIE enjoyed high quality at year-end with high liquidity, sorry, at year-end, with EUR 1.7 billion available, including EUR 1.1 billion of excess cash and EUR 600 million of undrawn RCF. Our leverage ratio at all-time low is reflecting our cash generative model and allows for a strong credit position upgraded to a BB+ rating.
Such low level of leverage ratio will enable the group to lower the margin applied on its term loan facility as from 2024, this by 20 basis points, and this is in accordance with the conditions of our senior facility agreement. Moving to the recommended dividend for the fiscal year of 2023.
On the basis of a steady payout ratio policy of 40%, the board of directors will propose to the general meeting a dividend of EUR 0.83 per share. This is an increase by 13.7% in comparison to the year before. This dividend, to be paid in cash, includes an interim dividend of EUR 0.22 already paid in September of 2023, with the remaining EUR 0.61 per share to be paid on May the 16th of this year.
As per our dividend policy, an interim dividend will be paid again in September 2024, for an amount equivalent to 30% of the approved 2023 dividend. Before I conclude this section, let me mention our new reporting segmentation for the year 2024. Nuclear services will be included in the France segment, as nuclear services are exclusively delivered in France, and SPIE Nuclear already belongs to our French organization.
Germany and Central Europe will be reported separately, Germany on one side and Central Europe on the other side. SPIE Global Services Energy, the former oil and gas services, will be reported standalone. This new segmentation better reflects the evolution of the geographical mix of the group. In order to align with the usual practice within the market, the group publication in Q1 and Q3 will report only on revenue, providing, of course, with a trading update.
I will now hand over back to Gauthier.
Thank you, Jérôme. Now moving to slide 28. Let's have a look at our key figures relating to sustainability. We did make significant progress throughout 2023. We're on track to reach our targets for the year 2025. However, the only KPI which is not on track yet, it's a very important one, it is safety. We had 20 severe accident in 2023, so which is up 25% compared to 2019.
While the total recordable frequency rate did decrease by 20% over the same period since 2019. Not pleased with this, accidents in 2023, and we have a strong action plan to go back on track. But as I said, the whole safety performance is still a significant progress compared to 2019.
We did progress regarding gender diversity, and with an increase of 17% of women in key management positions compared to 2020. And in this regard, 2023 has been a good year since 35% of open key management positions have been staffed with women. Regarding green share, 48% of our revenue is now aligned with the EU taxonomy. This is one of the highest levels among the SBF 120.
It compares to 46% in 2022, reflecting the momentum in our progress linked to the long-term trends of our business, and closing the gap with the 15% goal that we have set for 2025. Our Scope 1 and 2 emissions have decreased by 10% since 2019. I'll further focus on another slide on this presentation.
We also made significant progress in our Scope 3, as we reached 47% at the end of 2023, of the emissions related to our procurement made with suppliers, having set themselves ambitious targets to reduce their carbon footprint by 2025. Going into further detail on our green share revenue.
We've been pioneering this indicator for five years now. 48% of the revenue is aligned with the EU taxonomy. It does reflect our role as a key enabler for energy transition. The shift in the energy mix accounts for 21% of revenue. It includes electricity transmission and distribution services performed on powering directly or indirectly, renewable energy.
Energy efficiency solution accounts for 24% of the revenue, includes areas of our work for installation, replacement, or maintenance of highly energy-efficient HVAC systems in buildings, technical solutions for highly energy efficient new buildings, energy efficiency in data center, and also data solutions contributing to industrial companies. We have 3% from low carbon mobility.
We category regrouping charging infrastructure for public transportation, transportation, sorry, and electrical vehicles. Again, on the side of the green share, clearly illustrates the fact that SPIE is part of the solution and a key enabler for energy transition. Moreover, in total, 74.5% of our revenue are eligible to the EU taxonomy on top of the 48% that are aligned.
On slide 20, focus on reduction of SPIE's direct carbon footprint, and obviously, 90% of our direct emissions come from our vehicle fleet, so it is an important challenge to reduce the carbon footprint of this fleet, and obviously, the most efficient way is to use electric vehicles. At this stage, we have been impacted by the delays in electric vehicles deliveries.
Our purchase orders are high, and we reached 54% of fleet renewal to electric vehicles by the end of 2023 in terms of cars ordered, but they're not yet all on the road, but it bodes well for a significant improvement as soon as 2024. Looking at our external ratings, our ESG commitment has been recognized by leading rating agencies.
So SPIE stands at the top 3% of companies rated in business support services by Sustainalytics. EcoVadis has consistently recognized our effort. It places us in the top 5% of companies in our sector, and we've been awarded the Gold category for the ninth consecutive year. Furthermore, CDP rated SPIE with a B score, and finally, we are rated triple B under MSCI.
Looking at our people, we have more than 50,000 employees in the group at end of 2023. In 2023, we had a robust recruitment strategy, 6,400 new hires, and 1,300 new apprentices. I would like to highlight the fact that 1,600 recruitments were made through our referral program. It's been implemented in all our countries. It proves very efficient. It's a remarkable success.
It also illustrates a strong commitment and confidence of our employees in recommending their employers to possible candidates. In 2023, our turnover rate was at 7%, a clear improvement compared to 2022. SPIE being a key enabler for energy transition and sharing a strong entrepreneurial mindset, it does continue to be a place where workers wish to stay for the journey, as they are valued, they're welcome, they're well-trained, and they have good potentials to move upwards.
Now, the 2024 outlook. So again, looking ahead to 2024, we are very confident deliver yet another strong year. We continue to deliver, obviously, further organic growth at a slower pace compared to 2023. We will further increase our EBITDA margin. We'll continue our dynamic bolt-on acquisition strategy, which remains a core aspect of our business model.
We will stick to our policy of dividend distribution, with a payout ratio of 40%, about 40% of the adjusted net income attributable to the group. As the group has now reached its 2025 EBITDA margin guidance, which was at 6.7%, and we've done that two years in advance, we are now upgrading our 2025 midterm margin guidance. Our EBITDA margin is on the path of continuous improvement towards 7% in 2025. Other targets remain confirmed and unchanged. This concludes our presentation. We'll now take your questions. Thank you for your attention.
Thank you. If you would like to ask a question or make a contribution on today's call, please press star one on your telephone keypad. To withdraw your question, please press star two. We will take our first questions from Rory McKenzie from UBS. Your line is open. Please go ahead.
Good morning, it's Rory here. Three questions, please. Firstly, can you be more specific on the organic growth outlook for 2024? I understand it will moderate from the record 8% in 2023, but do you expect it to slow from the 5.5% exit rate you saw in Q4? Any comments you have on the backlog strength would also be helpful.
Then on the 2025 EBIT margin targets, and, of course, you've had really good progress over the past two years, and good to hear you can hold on to that, but can you explain or give more detail on how you expect to continue to push margins up, given the past two years have been, you know, quite a unique environment, with very tight markets and very strong demand?
So, yeah, how are you going to drive new records? And then finally, just on the segment change, is there gonna be any internal management reorganization around this, any exceptional costs? And can you just clarify what the organic growth rate within nuclear has been, so we know how to adjust the base? Thank you.
Thank you, Rory. So, well, regarding our organic growth, we obviously have given a guidance to until 2025, and with an average. So, I think clearly to reach this guidance average, we cannot go too low in 2024, and this is by no means our forecast. So I think we are very confident for 2024. You mentioned the backlog. We have an excellent backlog, and when we look at the order intake for the beginning of the year, it is strong. So, we are again very confident to be in line to deliver on the 2025 guidance.
Again, the backlog is not only on very good quality in terms of size, but also in terms of margin. We had experienced a very good trends in 2023, which is shown in, you know, the fact that we did beat the margin guidance. So it's on the back of a very good portfolio, very good backlog, very good pricing power, which remains very strong because our services are scarce. We are good at what we do. Our customer trust us and need us, so we are really able to maintain a strong momentum in terms of pricing power. This is true in all our geographies, in all our market segments. Clearly, we keep working on the operational excellence.
T his margin progress over the next two years is something we will absolutely deliver on. Regarding the segment change, it is only a reporting matter, and we think it's clear. It also pays tribute to the growth in Germany. It also pays tribute to the growth in Central Europe. So we thought it would make it more visible and also clearer to the analyst and investor community. It doesn't entail any change of organization, nor obviously, any restructuring costs.
Jérôme has shown that all these restructuring costs were very low in 2023, and clearly, with the pattern of our market so far, we have any issues with that. And clearly, this reorganization does entail zero restructuring cost.
Just to follow up on nuclear being added into France, is there any impact on, I guess, the organic growth run rate in France? Was nuclear growing as organically?
You know, it is, it is compared to the whole of France, nuclear is not huge, so, arguably, it would have been dilutive to the organic growth of France in 2023, for the reasons we mentioned, huh? But, again, this impact is minimal, and at the end of the day, well, it is included in the group, so it doesn't change.
That's right. Thank you, Didier.
Thank you. We'll take our next questions from Eric Lemarié from CIC. Your line is open. Please go ahead.
Yes, good morning. Thanks for taking my question. I got three, if I may. First, on the organic growth in 2023, could you give us the volume and pricing contribution to the organic growth? And maybe could you give us an idea of what kind of pricing you expect in 2024? I got a second question on the accounts, actually. The margin improvement of accounts has been okay in 2023, and I was wondering if you observe any positive behavior from your competitors, including accounts, now, and do you see any positive impact on the competition mood in the market?
The last question, regarding the margin, for the Northwestern Europe, the margin there are below your margin in France or in Germany. Just how would you explain the difference of margin between Northwestern Europe and France and Germany? And do you think margin in Northwestern Europe could catch up with France, Germany, or Central Europe? Thank you.
Hmm. Yeah. Thank you. Well, the price volume question is always a delicate one for us, because it's very, very difficult for us to calculate. And so we estimate that with the inflation, we did so in 2023, which was a bit higher and especially on salaries. There's a higher price effect in 2023 than the past, but very, very difficult to ascertain. And in 2023 our wages increased roughly 5% average across the group. We think in 2024, it looks like it's going to be 3-3.5. So obviously, you see a bit of a difference there.
But, for the price impact, there's not only inflation, there's also pricing power. And I think, you see, this pricing power reflected in margin increase. So, regarding accounts, yes, the behavior is much better, thank God. So it reflects on the margin, on the margin progress, which is not insignificant. Still some way to go, but, at least it's a good trend. And, yes, the behavior on the market is much better. And it is similar when you look at other competitors like Eiffage Énergie Systèmes. We see as also a good trend regarding margin reflecting very, very good behavior on the market.
W e do benefit in that sense of a more favorable environment. People are aware of the scarcity of resources, and at SPIE, we really focus on choosing our battles and working for the right type of customer and on the right type of contract, not wasting our good workforce on the low profitability contracts.
T his is something that is now more spread amongst the competition, and we do welcome that very much. Regarding Northwestern Europe, we will have a further progress, and clearly we have a very very good pattern in the Netherlands, and basically, the Netherlands alone are on par with France and Germany.
Y ou know, around 6.6, Belgium, well, it's smaller on a different market, and this is where we still need to improve going forward. And so confident for the Northwestern business going forward, especially remarkable performance and trends in the Netherlands, which is also reflecting in the cash generation.
Thank you. Thank you very much.
Thank you. As a reminder, if you would like to ask a question, please press star one on your keypad now. We'll take our next questions from Augustin Cendre from Stifel. Your line is open. Please go ahead.
Hello. Thank you for taking my questions. I've got two, if I may. The first one is a kind of a follow-up on margin. I'd like to understand where the opportunities might come from in the next two years and the timing also of that margin expansion. Maybe you could talk there about the margin opportunities you see in Germany, in T&D, and you could maybe also elaborate on how much Northwestern Europe could represent in that margin expansion at the group level.
The second question relates to working capital. You've reached negative 37 days this year from negative 38 last year. It's now been four years with very strong working capital. Is that 37 days the new normal?
As a second question on working capital, do you benefit at all from prepayments coming from new contracts?
Jérôme will take the question on working capital. Regarding margin opportunities, as I said, we did make good use of our pricing power. Going forward, there is also, well, the further focus, as I mentioned, there are still some areas of progress. I mentioned a few. Germany will progress further, definitely. It's, we have excellent levers in terms of operative improvement in Germany, and they've shown a very strong pattern, but they still have plans to improve further.
O n top of that, at group level, there will also be some impact of the relative acquisition we've done last year or at the beginning of this year. So I'm really no doubt regarding further margin progress both stemming from organic improvement plans, which are at work now, and relative acquisitions. And Jérôme?
Yeah, regarding the working capital, we always had a question whether there is a normative number of days so as to set the working capital going forward. I constantly said, and it stays very true, that the ultimate goal is rather to focus on the cash conversion. And to that respect, in 2023, we highlighted again, and we posted a cash conversion well above 100%.
W hen you read the 37 days, bear in mind as well what I explained in the presentation, meaning the increasing value of one day of working cap, which in 2023 was a quite sizable increase. So there is no fixed number of days being normalized. There is a trajectory, and which is very well as such.
Regarding the structure of the working cap, yes, we did benefit from prepayments from our customers, as always, and this on a permanent basis. But I would even specify that at the end of December, that amount is rather below what it might have been already in the past.
This is heavily depending on the sequencing of some contracts at the stage—at the time we start the ramping up on some contracts. I do insist on the very high quality of the working cap at December end. Also, posting a slight reduction if we look at the number of days of our accrued income, the WIP, and it went together with also a slight reduction in the trade payables.
A very good starting point for 2024.
Thank you. As a reminder, if you would like to ask a question, please press star one on your telephone keypad. We will take our next questions from Laurent Gelebart from BNP Paribas. Your line is open. Please go ahead.
Yes, good morning. I have a couple of questions. So the first one regards France and the backlog. So could you share with us how do you see the backlog evolving for France? I'm mentioning that because we know that FTTH or FTTX in France should go down, should decline.
H ow is evolving the rate of deceleration down of this activity? And also, are you positioned on the decarbonization projects being sponsored by the state? I'm referring to, for instance, ArcelorMittal, which is set to invest EUR billions to reduce the CO2 emissions of its facilities. So how do you see potential for you on this one and other decarbonization projects in France?
Well, thank you, Laurent. Well, regarding the backlog in France, it's very good. I mean, the FTTH decrease is a minor thing to us, and it's not now more than compensated with the growth in recharge infrastructure for vehicle, and which is absolutely booming. And we had also a very good order intake in the industrial segment. So basically, the backlog is good in France and both in terms of volume and quality. So no concern in this regard. I think the whole of SPI is involved in decarbonization projects and of all kinds. It's as evidenced in our green share.
W e are involved in some carbon capture and storage projects in France. We are involved in hydrogen projects as well. We're involved in wind farms in France. We are a good player in solar energy. So it is. And as you know, at SPIE, we focus on the large number of smaller projects as the one large white elephant-type project. And so where usually the prestige project are not necessarily the most margin accretive. So yeah, decarbonization is a huge driver for France and more generally for Europe at the moment.
Thank you, Gauthier.
Thank you. We have no further questions in the queue. As a final reminder, if you would like to ask a question, please press star one on your keypad now. We will take our next questions from Christophe Chaput from ODDO BHF. Your line is open. Please go ahead.
Yeah, good morning. Christophe Chaput speaking from ODDO, and congratulations on the results. Just a quick one for me, because you speak about FTTH in France. There is also, as well as I know, opportunities on FTTH in Germany. Would you say that it will be visible, let's say, on your organic growth for 2024, please? I mean, I'm just looking at the pace of ramp up at any certain extent.
Well, you know, in Germany, at the moment, we do roughly EUR 100 million in FTTH, FTTX, out of a business which does roughly EUR 3 billion. So obviously, it is a contributor in terms of organic growth, huh? Germany is lagging behind in terms of FTTH, huh? And, for us, we have done a few years ago a small acquisition in this regard, the Wir lieben Kabel. And, it's clearly something we're looking at, huh? There's still a huge potential in Germany for FTTH , fiber, compared to the maturity of the French market today. And Netherlands are probably in between, and Germany is way behind.
Clearly, for us, in terms of organic growth or further bolt-on opportunities, it is an area of strong interest.
Okay. Thank you.
Thank you. It appears there are no further questions, so I will hand you back to your host to conclude today's conference. Please go ahead, sir.
Well, thank you very much for your attention today and for the interest you take to see. We'll endeavor to further deliver in 2024. A lot of confidence for the year. A very strong starting point and very good momentum. So very confident on 2024. And again, it's a great time to be an electrical engineer. Thanks a lot.
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