Welcome to Bilfinger's Conference Call on the Q3 of fiscal year 2021. My name is Bettina Schneider, and with us today in this Conference Call are Christina Johansson, Interim CEO and CFO, as well as Duncan Hall, COO. Christina and Duncan will now present on Bilfinger's business development in the months July to September. For the moment, your lines are put on mute. Afterwards, we're happy to answer your questions. With this, I hand over to Christina Johansson.
Thank you, Bettina. Ladies and gentlemen, a warm welcome also from my side to our conference call on the development of Bilfinger in the Q3 of 2021. I'd like to start on page two, where I first of all give you a short overview of the key figures. Bilfinger again delivered a good quarterly performance, and we are well on track to reach our full year targets in 2021. In our markets, we are experiencing an overall positive environment. However, some customers are facing increasing challenges in the progress of their projects due to supply chain bottlenecks. In addition, they are partly concerned about inflation in material prices and labor. All this leads to slower decision-making on customer side for especially our customers in the North American market. Still, orders received have grown by 31% organically compared to the weak prior year quarter.
This was based on a strong increase in all of our segments. Book-to-bill year-to-date was at 1.00. Revenues were up by 12% organically, and here we see year-on-year growth in all our segments. In the Q3, EBITA adjusted was exceptionally good at EUR 51 million. E&M Europe and Technologies continue to improve and deliver in line with our expectations. Progress in E&M International, however, slower than anticipated. The adjusted EBITA margin is especially strong based on very good operational performance, but also supported in Q3 by gains from the disposal of non-operational real estate in the amount of EUR 18 million. Reported free cash flow in Q3 was positive EUR 73 million based on improved net trade assets against Q2 . The good cash performance supports the expectation of a positive free cash flow in full year 2021.
As a result of our earnings development in the first nine months of 2021, and especially in the light of the additional real estate gains, we are now in a position to again slightly raise our outlook for the adjusted EBITA margin in full year 2021. Now we expect to exceed the 2019 pre-crisis level and slightly surpass 3% in the financial year 2021. I now hand over to Duncan Hall, who will take a closer look at the development of our markets and also at some contract highlights in the Q3 of 2021.
Thanks, Christina. Hello, everybody. I hope you and your families are still safe and well in these continuing challenging times. Let's start looking at the markets. We'll go and look at E&M Europe, first of all, Engineering & Maintenance Europe. We stabilize now very much within the chemical and petrochemical area. The postponed turnarounds from 2019, 2020 have come through in 2021 and will continue to come through in 2022, which will give us some increased revenue over those periods. We still have some bottlenecks, as Christina mentioned, on supply chain, mainly on the customer side, and inflation concerns, which are causing postponement and delay of a number of project decisions and investments as with some of our customers. In energy and utility, we're starting to see some significant activity now.
Quite a number of engineering feed studies taking place, looking at planning applications, all looking to establish that green energy transition market that we are anticipating will come through in the future years. In oil and gas, operating expenditures have started to stabilize. We've seen a little recovery after the COVID restrictions have ended in some of our markets, and we'll continue to see that gradual recovery over the coming months and years, but probably not getting back to the levels that we saw pre-pandemic. If I move on to E&M International, which for us, as you remember, is Middle East and North America.
Again, positive signs here continuing to grow and recover, especially around energy transition, starting to see a more determined effort here to move forward in the areas of North America as well as the Middle East, especially in hydrogen areas. In chemical and petrochemical in North America, there's still a strong pipeline in chemicals, but we're not seeing these come through as quickly as we expected, but they are coming through, and we are starting now to price work for the future. In Middle East, still continuing ambitious investment plans happening in infrastructure and also within oil and gas. They still continue to be made. In our last sector, we talk about technology. Here's where we focus on energy and utilities, largely the nuclear market and pharma and biopharma. Both very strong markets at the moment and attractive markets.
You'll see a bit later on as I talk about nuclear, you know, the demand in new build and maintenance and also decommissioning and demobilization continues to be strong in France and U.K., Finland, among others. In Germany, we are mainly focused on decommissioning. In biopharma and pharma, continuing to see a number of small projects associated with the vaccines from COVID-19 and future treatments around there, and also starting to see a stronger shift towards outsourcing and production services within this market that we haven't seen before. Again, part of the supply chain issue and COVID restrictions is leading to a stronger regionalization and shortening of supply chain and storage, which is proving to be a positive element for us within this area. If we now shift into looking at a few highlights of orders to spotlight for you.
One in Europe, first of all, a fantastic order for us. This is in Austria with one of our customers, OMV, that we've worked with for many, many years. This is an eight-year maintenance contract covering mechanical, electrical, instrument, insulation, scaffold, painting. This is, again, three Bilfinger companies coming together to deliver one Bilfinger with reduced risk, reduced interfaces for customers. We're managing all the maintenance on the refinery and the number of assets surrounding that area. This is a great achievement for our business in Austria, really increasing the amount of domestic maintenance that we do within that region. Again, shows that by bundling our activities together, we really deliver value to customers.
Also within Austria, we are now the largest industrial services provider for the last year, which is a great, a very positive development by the team in there with what we do across maintenance and projects. If we shift again onto another framework, another first for us, our first major framework order in maintenance in the U.S., in the Houston area, where we secured a five-year framework with Evonik. We work with Evonik in Europe, and we've been in discussions with them in recent times to transfer the concepts that we work with them in Europe over to the U.S., and we've been successful in securing that. We'll be again responsible for the maintenance when it comes to mechanical work, insulation, scaffold, painting across at least one asset and maybe some more to come in the future.
If we then spotlight an energy transition area for us, really, a quite established area for us in the green electricity market, which is hydropower. We've recently been very successful with spotlighting just two of a number of projects we've won here, where this is penstocks. For those who don't know what penstocks are, that is the word given to the pipelines that run up the sides of mountains that transport the water up and down to the reservoir where we do pumped storage. These are replacement and refurbishments of penstocks and installation of new ones as well to secure those pumped storage plants and increase the megawatts that they can produce. These are long-term projects. They last four or five years in general terms.
These two particular packages, which is engineering as well as fabrication and installation, are about EUR 32 million at present times. A very good win by the team, again, in Austria in this particular case. The last one I want to talk through, and it wouldn't be right if we didn't talk about nuclear when we go through these is, again, a very brief update on where we are. On Hinkley Point, we're continuing to secure the call-offs against our EUR 500 million order, and we're up now around about the EUR 270 million mark out of our EUR 500 million to EUR 550 million. We're expecting that to continue, and revenue starts to develop and increase.
We're also working very hard with our colleagues in France, where as part of the Grand Carénage program, we just secured our first work of engineering within those areas on those EPR2 reactors that will start to develop and will be the next areas for us to move into, as well as what we're gonna be looking at in U.K. on Sizewell as well. Very much that nuclear new build area, a key area for us as we go forward. You may also have heard on this one in Germany as well around disposal. This is a contract we've won that we'll develop over the next four years to develop a robotic disposal system to take the existing waste out of the Asse mine shaft and relocate it to a safer facility.
We will design this over the next few years, fabricate it, and install it, and then hand it over for operation. Very interesting market for us. As we say, we work in both new build, decommissioning, and also waste disposal, where we're really bringing value to our customers again in what we do. There was a brief spotlight on what's happening in the markets and some projects that we've won, and I'll hand you back to Christina to talk about the Q3 in more detail.
Thank you very much, Duncan. We are now moving on to page 11, and we take a look at the order development of the group. Orders received increased significantly to EUR 917 million, reflecting very good organic growth of 31% versus last year, Q3 . This was based on strong growth in all segments compared with the weak prior year quarter, which had still been strongly affected by the COVID-19 pandemic. In absolute terms, we see a slightly lighter quarter compared to previous ones, but year-to-date, we achieved now the expected EUR 3 billion order intake. The order backlog grew organically by 14% to EUR 2.8 billion, and the book-to-bill ratio in the first nine months of this year was clearly above one. Turning to page 12, group revenue recovered significantly in year-on-year comparison.
It grew organically by a solid 12% to EUR 945 million compared with a weak prior year quarter. We saw a very positive EBITA development. In our segments, Technologies and E&M Europe, we are improving and delivering in accordance with the expectations. However, progress in E&M International is somewhat slower than anticipated. Our group achieved adjusted EBITA this quarter of EUR 51 million compared to EUR 23 million in the prior year quarter. This corresponds to an adjusted EBITA margin of 5.4% against 2.7% the year before. In Q 3, 2021, gains of EUR 18 million from non-operational real estate disposals added to the good operational performance. The EUR 33 million operational, EUR 18 million coming out of the non-operational real estate. These disposals had already been planned for some time, and we have now taken advantage of the very good demand on the property market.
Reported EBITDA was even stronger at EUR 54 million due to positive adjustments of EUR 3 million, resulting from a disposal gain of EUR 8 million for our stake in the joint venture in Oman. After the increased expenses for restructuring measures in 2020, only smaller amounts of special items are anticipated for the full year 2021. Proceeding to gross profit and gross margin on page 13. Both improved considerably against the prior year quarter, and we reached EUR 106 million and 11.3% respectively. The gross margin was even better than in Q 3, 2019. Adjusted SG&A expenses remained in the EUR 70 million range and were thus below the expected quarterly run rate. This was also due to one-time effects, such as less travel expenses due to COVID-19.
The adjusted SG&A ratio measured against revenue was this quarter 7.5% compared to 7.9% in prior-year quarter. Let me now briefly comment on the development in our three business segments. I will start on page 14 with E&M Europe. The segment delivered significant growth at a good margin level. Don't forget, this is our largest segment. Orders received increased by 17% to EUR 587 million compared to EUR 501 million in the prior-year quarter. Revenue went up by 11% to EUR 633 million, and the book-to-bill ratio year-to-date was above 1%. The segment's adjusted EBITA improved to EUR 35 million, corresponding to an EBITA margin of 5.5% after 4.7% in Q3 2020.
This reflects the success in reducing seasonality in the segment's earnings development, as well as further improvement in the utilization rate. The outlook for 2021 is confirmed. In E&M Europe, revenues will grow significantly. The adjusted EBITA of the segment in 2020, the number was EUR 69 million, is also expected to improve significantly. Looking at E&M International on page 15, we can see a substantial increase in orders received of 41% to the amount of EUR 116 million. Revenue grew by a strong 31% to EUR 141 million. Both numbers, however, are compared to a very weak prior year quarter. Adjusted EBITA was negative at EUR -3 million. The adjusted EBITA margin was -2.4% after -8.6% in prior year.
Improvements in North America are currently proceeding slower than anticipated in terms of volume and project execution performance. Looking forward, we have to be very selective in the North American project market. The price level is not always convincing. It is currently a customer-driven market. We believe that the ramp up of the maintenance volume is the right strategy for the mid to long term, but this will certainly take some time. In our outlook for the segment, we still anticipate a significant growth in revenue for the full year 2021, although not fully on the originally budgeted level. Adjusted EBITA, which was EUR -21 million in full year 2020, is expected to improve, but will remain negative in 2021, in contrast to our previous expectations.
Here, some projects have been delayed and some claims and variation orders are still under negotiation, where it is uncertain if we will be able to close these negotiations this calendar year. The outcome will determine the exact Q4 performance of the segment E&M International. To summarize, North American volume ramp up is not as planned. Project decisions are proceeding slower than expected. Clients continue to weigh the timing of capital expenditures against the impact of supply chain disruptions, labor availability, and inflation. Despite slower growth than originally anticipated, we will have most probably at least a balanced result in 2022. Not to forget, the downside in North America is more than compensated by the European business this year. Coming to Technologies on page 16. The segment delivered a substantial increase in orders received of 90% to EUR 170 million.
This was largely supported by call-off orders for the Hinkley Point C nuclear power plant project in the U.K. in the amount of EUR 62 million. Book-to-bill in Q3 was at 1.2%, while revenue grow by 3% to EUR 141 million. The segment's adjusted EBITA was solid at EUR 7 million, and the adjusted EBITA margin improved to 4.7%, coming from 4.2% in the prior year quarter. In our outlook for 2021 for Technologies, we anticipate significant year-on-year growth in revenue. EBITA adjusted will improve to a clearly positive result after a EUR -11 million in the full year 2020. As you can see on page 17, net profit rose to EUR 41 million compared to a negative EUR -19 million in Q3 , 2020.
This development was driven by the improvement in EBITA, also supported by a low tax rate based on the utilization of German tax loss carryforwards. Both operating cash flow of EUR 65 million and free cash flow of EUR 73 million have improved compared with Q 3, 2020, but also compared with previous quarter in 2021. Free cash flow was additionally supported by the inflows from real estate disposals in the amount of EUR 30 million. Looking at the liquidity development on page 18. Net liquidity, including IFRS 16 liabilities, improved against the end of the Q2, of course, to EUR 278 million. In Q 3, net trade assets slightly improved to EUR 500 million, but end of September, mostly based on the DPOs.
We will now continue in Q4 to tighten up our working capital management, in particular with regard to our DSOs. There are all necessary measures in place to convert a significant proportion of our receivables into cash in the last quarter of the year, but there will remain a certain growth-based working capital consumption for the full year. On page 19, some final remarks on our outlook for the full year 2021, which we again slightly raised. Excuse me. We continue to expect a significant revenue growth in financial year 2021. Furthermore, a substantial improvement in adjusted EBITA is also anticipated. In light of the additional EBITA contribution from the disposal of non-operational real estate, the adjusted EBITA margin will now slightly surpass 3%. We also expect a substantial improvement in our reported EBITA due to significantly lower expenses recognized as special items.
Free cash flow is expected to be positive, but below the prior year level, this despite a substantial improvement in EBITA. The reasons for this are, as already mentioned, increased working capital requirements as a result of the planned revenue growth and the higher cash outs for the restructuring measures implemented last year. That brings us to the end of our quarterly presentation. Thank you very much for your attention. Duncan and I now look forward to take your questions.
Thank you, Christina. With that, Christina and Duncan are ready to take your questions. If you'd like to ask a question, please press zero and one on your telephone keypad. To withdraw your request, please press zero and two. I repeat, if you'd like to ask a question, please press zero and one on your telephone keypad. To withdraw your request, please press zero and two. First question comes from Craig Abbott at Kepler Cheuvreux.
Yeah. Hi, everyone. Just start with I also had troubles getting into the call, so there may be some others similar problems as well. I missed the very beginning opening comments, but it sounded like later when you were going through the divisions that this hold back by customers regarding the three factors, uncertainty on inflation, worker availability, and supply chain concern. It sounded like that's been primarily focused on the E&M International Division. Could you, again, first of all, confirm that or not? Secondly, even if that's the status today, what's your thoughts in terms of maybe these concerns also becoming more of an issue here in Europe in the coming months?
I just wanted to also in general ask how inflation protected you are in terms of like inflation cost adjustment clauses in your contracts, and how do you see your own worker inflation profile, let's say, going forward 12 to 18 months? Thank you.
Okay. Hi, Craig. It's Duncan here. Certainly around projects, we were talking through that we see some delay in those investment decisions. There, you know, there's some market influences where previously decisions were made and now they've been held back, and people are reviewing those, but also now uncertainty about inflation and also a lot about the key equipment supply that is being delayed and leading to repricing of some of the major assets that are involved, are leaving people to delay and rethink about when they do those investments. They're not being said they're not gonna happen, but there's a delay. We're not seeing particularly people saying, "Hey, we're not gonna do a project because we're worried about the workers." But it is a factor where there is a level of uncertainty, again, associated with materials as well as resources.
Certainly within our labor markets, we see a tightening of the resource supply, which then leads to further inflation pressures on wages.
Mm-hmm.
I mean, how are we affected by that? In most of our framework projects, we have annual increase factors in there, either an agreed index or just a back-to-back with wage increases. Also more and more we have clauses that we're including in contracts for material indices as well because of the uncertainty. We either price in the risk, or we actually peg the material prices to an industry index and increase them automatically. That's how we're dealing with it. We're seeing no increased risk at the moment, and we're being very, very cautious and conscious of making sure we don't increase our risk profile because of these pressures.
Okay. That's very helpful. Just to confirm, you are also in Europe seeing now some delays in the decision-making process on projects. Did I understand that correctly?
Yes, we are. That is correct. They're not as impacting others in Europe because our project exposure within Europe is not as great.
Yeah.
Where the bulk of our work is in maintenance and turnaround, so it is not as impacting. It's on the major projects we see these slight delays rather than the modifications. The modification area is actually quite strong, which is very good for us, where people are now seeking to really look to how they can improve throughput with smaller modifications on their assets, which suits the work we do with our customers under those contracts.
Okay.
Um
Thank you very much. Mm-hmm.
Craig, Christina here. Just to add to this, I think the expectations on inflation are clearly also from our side, and what we see so far are higher in U.S. than what we expect and what we see in Europe. There is also a clear difference in regard of the European approach. I think in general, we have to say that we have lived without this low inflation for many years. We need to get used to it. We need to get more agile to work in that kind of environment. It might increase in Europe as well, but right now we see it above all in North America.
Okay. Thank you.
Thank you.
It seems that there are no further questions. If there were more difficulties to enter the call, please don't hesitate to give us a call afterwards to the IR team, and we're happy to answer the questions then. We conclude today's call. Thanks for participating. Please save the date for our next Capital Markets Day on February 10th next year, and until then, please do not hesitate to contact us whenever you have a question. Goodbye and stay safe. Thank you.