Ladies and gentlemen, a warm welcome to our conference call on Bilfinger's Q1 2022 figures. My name is Bettina Schneider, and I will lead you through this call. With me here in the room are Thomas Schulz, our new CEO, Christina Johansson, our CFO, and Duncan Hall, our COO. After the presentation of Christina and Thomas, all three executive board members are happy to take your questions. As of now, all participants are in a listen-only mode, and the conference call is being recorded. You can pose your questions via chat in the web conference, and don't forget to press the Set button, or alternatively via phone by pressing Star and one on your phone. Last comment, as we have our AGM today, we ask for your understanding that we will conclude the call latest by 9:00 A.M. We're happy to take your questions in the next days.
With this, I would like to hand over to Thomas Schulz, CEO of Bilfinger.
Good morning, everybody. Let's start directly with the overview. We had a good start to the year, which underpins the positive full year expectation. The markets. Customer demand is especially driven by higher energy prices and change in the energy mix. If we look into the figures, 10% organic growth in order intake, 14% organic growth in revenue, and a 0.9% EBITDA margin, which was stable despite provision for the Russian phase-out situation. On the cash, based on seasonality and higher working capital demands at the beginning of the year, we ended on -EUR 76 million. The outlook for 2022 is confirmed. Revenue with significant growth and EBITDA with significant operational improvement. Now we go to the markets. Let's start with the chemicals and petrochemicals. That stands for 30% of our revenue based on the year 2021.
The overall trend is, yeah, flat to good. We have larger investments expected going forward, especially associated with renewable carbon and reduction and batteries. When we look into, we have overall an increasing demand for sustainable industrial services, especially where we as Bilfinger are strong in the combined services. There we see an increase in demand. You see on the slide on the right side, an example of that what we do here. It's for INEOS and INOVYN, where we do on three production facilities in Norway, a comprehensive turnaround with 800 workers for eight weeks. There we can play our full potential with our numerous different trades and competencies, like inspection, insulation, mechanics, et cetera. Next market is on the energy and utility, stands for 20%. Here we see definitely a good trend. Where is it coming from?
It has to do with the clear increasing demand, discussion, action, push of the societies into green energy, renewables, hydrogen, carbon capture. All the climate change related drivers are driving that very much into the positive. Not to forget. Really not to forget is the nuclear power, where we clearly can say we have a revival. The reason for that is, of course, the net zero strategy of a lot of areas, not only in Europe. If we then look into what we do as Bilfinger, you see on the left side an example out here, out of beautiful Mannheim, where we do a commercial heating support, and that is clearly in the sustainable services what we offer. It's an electrical and automation service for various district heating projects within Europe. Out of that, I would like to go to the oil and gas on the next slide.
It stands for 20%. Overall trend is flat, but we clearly see based on all the things regarding Russia and the Ukraine war and the push for more sustainable solutions that this area is recovering. We see a demand at the moment mainly verbalized for LNG terminals and gas storage. We see a demand for more exploration of alternative oil and gas resources, definitely outside of Russia. You see on the right side an example of what we do there. It's the major North Sea framework agreement, which goes over minimum seven years, where we have more than 400 skilled workers from Bilfinger working on maintenance, modification, improvement, operation services for three UK offshore platforms. Out of that into the pharma and biopharma market, which is 10% of us on the next slide. Overall trend, quite positive, and it has actually multiple reasons.
At first, we have a mega trend that comes out of the COVID and the more health-related focus of the societies around the world with the wish to regionalize, to localize more of the different productions. On top of it, of course, the wish and the demand to improve existing setups and not to forget to make them more sustainable, too. Out of that, you see on the left side an example what we can do here. This is service for U.S. biopharma production plant, where we have a package for four production lines consisting of bioreactors and feed stream. The execution is this year up to the end of next year. The value is roughly EUR 30 million. This is an overview about, or this was the overview about four markets and examples what we do.
Out of that, I would like to give to our Group CFO, to Christina.
Thank you very much, Thomas, and also good morning from my side. I will start on page eight with the order development or the intake of the group. Orders received grow by 10% organically to EUR 1.1 billion. This marks the highest single quarter since quarter two, 2019, and was driven by a significant rise in orders from our European markets. We have seen very good demand in framework contracts, especially in the UK and Nordics regions, as well as for projects with biopharma clients in technology. The order backlog saw organic growth of 11% to more than EUR 3.1 billion, compared to EUR 2.8 billion one year ago. The book-to-bill ratio of 1.16 again underpins Bilfinger's growth ambitions going forward, although there will remain always a certain volatility quarter by quarter.
It's a really good start of the year when it comes to order intake. Turning to page nine, group revenue grew by a strong 14% organically to EUR 961 million. We generated a stable EBITDA of EUR 9 million, which corresponds to a margin of 0.9%. As Thomas already mentioned, in view of the war in Ukraine, we decided not to accept any new orders from Russia. Existing contracts will be phased out. The associated restructuring costs in Russia mainly referring to severance payments, supplier adjustments, linked to special items of approximately EUR 10 million. Obviously, this was not foreseen when we have provided our earnings outlook for 2022. Therefore, this lowers our EBITDA expectation by this amount. However, the guidance for a significant increase in EBITDA is confirmed. As expected, underlying operational earnings development was positive.
Gross margin continued to show a good increase, which can be seen on the following page. 9.9% gross margin includes an EBITDA profit, which rose significantly to EUR 95 million from comparably lower margin of EUR 39 million in the prior year first quarter. The high level of sickness in the first quarter of approximately 5% of our employees was well managed and had no impact on service delivery to our customers. It did have some impact on margins. SGA expenses of EUR 74 million remained at the level of the current quarterly run rate of EUR 85 million. SGA ratio measured against revenue of 7.7% compared to 8.4% in the prior year quarter.
We highlight a further step towards our target to improve the ratio to develop everything sustainable by increasing revenue without increasing the SGA expenses by the same rate. Now we report on the development in our three business segments. We start on page 11 with E&M Europe, the E&M Europe segment. In this segment, we have a significant growth as opposed to last year level. Order intake was generally positive. Orders received increased by 8% organically to EUR 736 million. And a lot of that referring to strong demand in our framework contracts. Revenue are up by 20% organically to EUR 637 million, and the book-to-bill ratio was set at 1.16. General order season was starting comparatively early in this year, especially in the Nordics.
Segment EBITDA decreased by EUR 3 million to EUR 13 million due to the restructuring costs of approximately EUR 2 million for the Russian business phased out and incurred in this segment. As mentioned before, we will not be able to compensate for this effect in terms of earnings. Underlying operational guidance remains the same. However, for full year 2022, here in Europe, we expect first growth in revenue after the very strong recovery in last year, 2021, as well as a significant increase in EBITDA. As again, restructuring expenses are holding this segment down pretty in regards to last year. Looking at the E&M International segment on page 12, including Australia, North America, and Middle East. Here you see a stable development in order intake, which were at EUR 163 million in Q1 2022.
The quarter now reflects our changed strategy towards a more service business as well as increasing the share of orders and major capex, which we believe is a more sustainable approach, especially in Europe and Russia. Revenue growth by a strong 55% organically to EUR 159 million comes from a low comparative quarter of EUR 110 million. Consequently, EBITDA improved significantly to EUR -1 million compared to EUR -7 million in quarter one last year. Better capacity utilization and the strategic realignment undertaken in 2021 is starting to show its effects positively. The EBITDA has improved accordingly to -0.5% compared to -6% last year in quarter one. In 2022, we expect continuous significant growth in revenue. Due to higher capacity utilization, we also expect a significant improvement in EBITDA to be realized in Q2.
To segment number three, Technologies or page 13. Orders received increased by a substantial 60% organically to EUR 133 million, leading to a book-to-bill ratio of 1.4. The increase was supported by major contracts in biopharma as well as in new territories. Revenue decreased by 5% organically to EUR 124 million, reflecting the more one-time project business that dominates this segment. The segment EBITDA was accordingly low, which is a low base, and at EUR 5 million. For the year 2022, we expect a significant growth in revenue as well as further significant improvement in EBITDA against EUR 19 million in the current year. Looking at figure page 14, the profit in quarter one decreased to -EUR 6 million, partly driven by a normalized financial result -EUR 10 million.
The net loss in the current year quarter was EUR 2 million. Which has included EUR 10 million non-recurring special items from the sale of Apleona as well as a favorable tax result. In addition, net charges increased from 0 to -EUR 7 million in the absence of full-year positive impact from a tax refund in Q1 2021. Turning to the cash flow and free cash flow were below the current year figure in the first quarter. The cash flow decreased to -EUR 76 million as a significant growth in revenues generated our typical seasonality that in the first quarter can increase the working capital requirements, a trend that is of course expected to improve as the year progresses. Looking at the strategic development on page 15.
Net liquidity, including our progress scheme facilities at the end of the first quarter, amounted to EUR 295 million, which has helped increase to EUR 523 million. We are continuously focused on our working capital management, in particular with regard to our DSOs. At the end of quarter four 2021, a DSO of 67 set a new benchmark. It's our target to achieve this good level again at the end of the year, and that requires a result of strengthening our abilities in terms of working capital further and this has been improving already in quarter two. So far on our financials in quarter one 2022. Thank you very much for your attention so far tonight.
Thank you very much. The outlook for 2022 is as follows. You can see our dashboards for the full year 2021 and what we expect in the different gray areas for 2022 to see. It's in revenue, EBITDA, and cost. The EBITDA margin, which is improvement operational improvement and the free cash flow should be on good level as in 2021. I'll take any questions from here.
Thank you very much. You can now put your questions via chat in the web conference or alternatively via phone by pressing star then one on your phone. The first question comes from Gregor Kuglitsch from UBS, the line is open.
Hey.
Yes, it is.
Good morning. The question is, maybe, your first impression of joining, you know, I think a couple of months ago or so. Maybe give us some first impressions of what needs to be done, et cetera. Second question would be just to clarify on the guidance. You say you're still seeing significant growth, believe that the revenue charge that you're now booking, your guidance was usually significant. I was British. I'm not going to love specialists. I think what we've done as a, as a, as a much for us is actually more with the minds. The power of scalability to have a change impact on energy transition in the top of the activities. The other things are also very sure.
The operating portfolio for what we can get to the industries that we operate in is really, really good. Regardless of their tough decisions, it's not an easy or any possibility and will result in a better financial outcome to acquisition costs because that's what I see. It is enough acquisition costs unlike what I see in other different industries. This time the customers are looking for outsourcing more and more. We are looking at that. Part of that overall growth. I think a huge market to Christina and all the other guys in the work of the last few years to grow quite significantly. We are not at 50% of the market yet, but good from that. We'll call that a result. Yes.
When you think about significant growth, we obviously think about growing your mind. We still are confirming what we already said in the last year that we expect in this year that as last year, it will be growth. I think publicly, I hope the pressure to want to get back to similar growth rate that we saw peak all these in the years 2017, 2018, 2019, which was around about 6%. We are obviously looking into taking into account that we certainly are living in a higher rate of inflation, but also we have some impact most likely on the top line. Exactly what we said on the significant growth this year is however the same combination, like the inflation and how much impact on that.
I think also what we are sharing through the course of the day is confirming that the guidance remains well as we are actually not only better than we did last year, but also slightly better than we had expected in the first quarter. When it comes to the EBITDA last year, this is the same guidance here as well. We are expecting this year to have a better improvement by all what we did last year, an improvement in operational improvements. As you remember, we had to constitute one-off effects in last year's design by turning off property. We are expecting that we will be able to pick up and be at a similar level with pure operational performance.
EUR 2 million that we now have provided for the exit, obviously in Russia, that obviously was not there for last year, so that leads to the carryover. That said, of course, it's not operational performance. There is, we can't say what. I mean, not only we, but there are a lot of companies also need to obviously try hard to cover these costs, which are still more at this point in time than what we anticipated with this journey, this geographic journey we're taking. We would generate EUR 1,000 and a couple to EUR 10 million at that cost quality today.
Sorry, just to be clear. Last year, 137. This 58, if I'm talking properly, you're saying 138 of global flow around to that, and then I guess what happens anywhere. I don't know if I'm clear, but is that the right way I got it?
Yeah. I would say so. It takes it down to, compared with last year, and then takes the EUR 10 million into account of the GM at least six out of seven. Which means that the comparable group that is presently around is a little bit too high.
Sure. Okay. Next question comes from John Campbell, Bank of America. One line open.
Thank you, Tina. Good morning, everyone. Just to ask, if I could get an update, in terms of your opinion on inflation. I was seeing, I think in Q3, when in 2021 you mentioned, you were seeing some supply chain delays, some cost inflation. But generally your business had a certain degree of cover in Q1. Is there any different update on that affecting the business? You know, even the cost of goods continue to be a challenge for you?
Yeah. As we said last year, we have in most of our framework contracts clauses around labor inflation that match the wage rises. They're continuously passed into our customers in terms of labor. Projects must have a short calendar build.
I mean, earlier in the project, much less than five months. On labor, like it's not overly comfortable because rises also happen after not only in the previous term. Surely if you compensate that going forward, that's going to be a massive issue. The supply chain, we're continuing to see stress brought into the entire industry here, not just speaking to ourselves. And a bit more steel obviously with the impact from Ukraine. Other than those, again, we can pull the levers that we need and we'll book perfectly for the season with our customers. Again, it's not easy. Our customers fully understand the situation. We're working with them closely to ensure that doesn't impact. Our greatest concern is the delays that the supply chain brings. It impacts our profitability, but just delaying revenue until second half year, as Christina has been saying.
Well, we did have slightly lower revenue in Q1 because of minor supply chain issues with our customers, not on our side. We'll see that come back with a vengeance in the second half with electrification going forward. Yes, we confirm we're seeing the product being used. It's not easy. As I said, that's not easy. It's a tough environment for us all, for our customers. Stephen, one quick follow-up if I can as well. Despite the sort of macroeconomic environment has changed a lot since February in terms of economic growth prospects in Europe. Are you seeing impact of that so far through your discussions with customers, a willingness to build fewer or any potential possible delays? Actually no. Possibly saying, obviously industrials will recognize that supply chains need to be shortened.
I just spoke to somebody in the oil and car areas. You know, in the energy areas where people are accelerating their energy transition plans. We're focusing on where we've got lots of opportunities and where we're to see these come through to fruition. We are starting to see that in the oil industry. We've seen Cologne/Rhine, which is by far a massive landowner for energy transition, and people want to be more localized on their energy requirements. I think we see this accelerated. On the house build, we've seen some certainty to the price as well. The market in Europe holding very well for our, for our needs. Thank you.
Next question comes from Stefan Bumhard, Bank of America.
Stefan, are you calling from Dubai?
Yes, I can.
How are you, mate?
Two questions. One that's related to the potential oil and gas boycott we have currently in Europe. Can you give a quick comment from your segment how the business looks or how your customers and second question is related to the EUR 10 million restructuring expenses related to Russia. Maybe you can more information on what we were talking about, what's happening there.
Now, I'll pitch in here. I will take on more of the gas thing. Obviously, the E.U. press in July were talking boycott on Russian oil and gas. We're not seeing a major impact of that. Germany ref ineries obviously did t ake Russian oil, going strong through the summer, and they're now controlling their inventories as we speak. From our perspective, what I think is happening is a modification, where they're ensuring the refineries can take a slightly different mix of oil or actually a slightly different sort of content. We don't actually see a continuation of our work where the refineries will keep on working all the way through. Yes, so, there's not a positive signal to a gas position, so we're expecting the impact there is awful.
Thanks. Talking about the Russian impact on the company from the report that was provided for March in the statements in Europe. Most of that is related to the severance payments made to people. We started off with around about 250 people in Russia before the war in Ukraine started. We have, as I said or Thomas Schulz said before, decided not to take any new orders or work. We are trying to help our clients to clear out the orders we have. In some cases, looking, negotiating how to quantify the liability. We have already cut as much of the inventory of people as there was. There now are about 50 lower.
The severance payments to these 250 people is a major part of the EUR 10 million. The other major part is obviously what we are expecting that we will write off all the working capital. Our counterparts here were really tricky. I think it would be very difficult to get the money back. We thought it best to really write off. That is the best answer I have. We will obviously try to turn all the working capital from Russia into cash. Given that the EU ban on Russian oil can come in, I think we will have to accept taking a couple of hits as is needed right now. These two items are then around about EUR 10 million that we now have provided for.
If you have a question, please press star then one on your phone. Alternatively, use the chat window in the conference.
I don't have questions right now. As you all know, bilfinger.com to contact the IR team after this conference or in the next days. Thank you very much for your participation. Stay safe, stay healthy, and see you all soon. Thank you very much, and goodbye.