Good morning, ladies and gentlemen, and very much welcome to the webcast Q3 presentation of AKVA group. The agenda for this morning is that I will do the introduction and the highlights. Ronny Meinkøhn, the CFO, will do financial performance, and then we will have a Q&A session. So please post any questions during my presentation, and the moderator will read the question during the Q&A. Let's go straight to the highlights for Q3. We had a revenue of NOK 817 million and an EBIT of NOK 29 million in third quarter. Acceptable overall order intake in Sea Based, but slow market in Land Based due to the resource tax.
Our rightsizing process, targeting NOK 45 million in annual cost savings, will be carried out in Q4 to adapt the organization to the current and expected activity level, and for the most, it is already executed. Due to the change in market condition, AKVA will revise the medium-term financial targets during Q4. Also, we completed the acquisition of the 51% of the shares in Submerged. That was completed in the quarter, in line with the earlier communication. Also, we extended our ownership in Newfoundland Aqua Services, and it was increased from 70% to 98.5%. Let's look at the key features. We came in at NOK 817 million for the quarter, down from NOK 840 million on a like-for-like basis. Not a record, but I will say a reasonable turnover.
Nordic came up with 10%, so that's positive. Digital came up with 30%, also positive, whereby Europe and Middle East, on the back of Turkey, where we see quite some headwind, came down with 35%. And also Land Based, down with 35%... No, sorry, with 7.5%. EBITDA came in at NOK 78 million, very much acceptable at Sea Based, actually at the same level, NOK 78 million. Digital with NOK 10 million, and then Land Based is disappointing, with negatively NOK 10 million EBITDA level. And this is the back of low revenue, actually, ballpark NOK 50 million lower revenue, compared with the previous two quarters. And also the combination of still low gross margin due to old contracts with, with, with, no cost escalation. CFO will do more details into this.
EBIT is NOK 29 million for the quarter, and then quickly, year to date, NOK 2.6 billion, which is, which is the highest in the last five years. EBITDA, NOK 223 million . This is on the back of a soft Q1 of NOK 59 million, a reasonable Q2 with NOK 86 million, and also reasonable Sea Based Q3, NOK 78 million, but weak Land Based. That brings it to the NOK 223 million . And EBIT year to date is NOK 77 million. Development of the order intake and the order backlog. We had NOK 600 million in total order intake. The Sea Based was okay with for Q3, with NOK 574 million . You have to understand that there is quite some seasonality in the order intake, so it's most meaningful to compare Q3 with previous Q3s.
In that sense, Q3 for Sea Based was the strongest in the last three years. That is also in a situation where we are currently not selling barges because the market is very slow there for the time being. So in that context, I'm pleased with Sea Based. Land Based is, of course, a very different story with a very slow market, and I will address the specifics of that market a little later. Digital at NOK 21 million, but on the back of a strong pipeline. That brings the order backlog to NOK 2.6 billion, whereby Land Based is reasonable strong with NOK 1.7 billion, but the time horizon behind this order backlog is more skewed towards two-three years. Sea Based is reasonable, given seasonality.
Then we are conducting a rightsizing of the organization in Q4. After introduction of the resource tax in the Norwegian market, it has been slow for, in particular, land-based. I'm talking post-smolt, but also for part of the sea-based business, and then in particular, the barge businesses, which is the more, let's say, costly investments for the farmers. As AKVA group, I believe we have, in particular towards our own employees, we have shown patience, we have continued to invest in all the three businesses, and we have also maintained the capacity in terms of number of people, in the belief that the market will improve.
However, it's no time to wait anymore, so we are now taking correct measures to ensure profitability and profitable operations going forward for quite a bit of it is already done, and approx 50 positions will be the reduction. It will basically be 20-25, based on natural departure, meaning that people are leaving and we are not refilling, and there will likely be 25 layoffs. The annual cost saving is estimated to be NOK 45 million, and the layoff cost is calculated to be approx NOK 10 million, and that will be charged to the P&L in Q4. And this cost saving effect of the OpEx effect of NOK 45 million, that will have a full effect in 2024.
Let's go to the strategic and operational status. Very quickly, the supply outlook for 2030, regardless the resource tax, is still the same, roughly 3% CAGR year-over-year. That's the expectations from analysts, et cetera. Also the expectation is a strong salmon price, and that is also reflected in the forward price for the next few years. So the fundamentals as such, they are still strong, regardless the Norwegian resource tax. With regards to ongrowing on land, we expect to see proof of concept there, and we hope to see a proof of concept there in the first half next year, when Nordic Aqua Partners in China will start to harvest salmon. Our innovation agenda for sea-based is about the three pillars.
It's marine infrastructure, it's precision feeding, and it's also about deep farming. So I go a little bit more into deep farming. Generally, we believe a lot more can be achieved within traditional farming in the fjords to reduce the sea lice issue. Generally speaking, concepts, concepts like deep farming is very realistic solutions, relatively little CapEx, and the purpose is to improve the sea lice and fish health situation for the next coming years. During the second quarter, we did sell deep farming, mainly Nautilus, for NOK 150 million in the Norwegian market. In the third quarter, which is normally the low season for those kind of products, we got new contracts at approx NOK 100 million.
Buyers were some of the largest salmon farming companies in Norway, like Lerøy, SalMar, and previously also Cermaq. Currently, we are also engaging with other potential customers, both in Norway and abroad. So we consider this a commercial breakthrough after many years with development and testing. It comes on the back, as earlier explained, with the excellent collaboration we have done with SinkabergHansen for several years, with the Nautilus solution. As you probably have seen, during 2022, SinkabergHansen harvested several sites with excellent biological results and no sea lice treatments. We now see a great potential for further commercialization of Nautilus, and we are very pleased with the new contracts, and we believe that the potential market is likely 5-6 billion NOK over the next five to 10 years.
One important disclaimer here is that the new customers, like already mentioned, they will test the deep farming technology, and if proven and validated, we can expect them to further scale up in the following years, in the coming years. But there is a time dimension here, to be clear on that one. Then a few words about OptiCage, to the right here. OptiCage is developed in collaboration between Northern Lights Salmon and AKVA, and also supported by the company Framo. AKVA has the IP rights on OptiCage, and the purpose here is also to reduce sea lice level significantly. We are now proceeding with more sites with Northern Lights Salmon and are also inviting other customers to run commercial trials.
We consider OptiCage also as a very promising solution, and there is no requirement with regards to depth, like for Nautilus. A normal site is fine. So Nautilus and TubeNet and OptiCage are all good examples of solutions providing a more sustainable fish farming with significantly lower sea lice treatments. And this also comes with improved fish health and, not at least, lower mortality. We think this is vital in the fish farmer toolbox for the coming years. On digital, to the left, AKVA Observe, which is our automated AI, artificial intelligence based feeding system. It's automation of feeding, the system is gonna do it better than the fish farmer over time, we believe. We have 104 sites worldwide on a new recurring revenue model.
25 new sites added in 2022, and 64 so far in 2023. Fishtalk, more stable there because we already have a global market share of 60%, so that is something working very well for us. And AKVA Connect, a few years ago, we also there changed the business model to be a recurring revenue model. Till now, we have 291 sites worldwide on this new business model. And it comes with a much better updated software as well and solution as well. 125 new sites added in 2022, and so far, 116 in 2023. And then, finally, Submerged, which is about automated sea lice counting and also biomass estimation. There we have now entered our first commercial contract in Q3.
Moving on to land-based, this is our innovation agenda for land-based. We are still focusing and investing in this one, regardless some headwind, because we realize that we still need to improve the technology and also qualify for a growing market in the future. Then some words about AKVA's view on the post-smolt market. First, about the concept and the technology as such, we believe very much that the post-smolt RAS concept is validated. Proof of concept on RAS for post-smolt is really there. With regards to AKVA, we have delivered many post-smolt solutions, around 20, and we have four very sizable ones in Norway, being Tytlandsvik, Mowi Norheim, Svaberget, and also Ærnes. And there are really significant benefits from a post-smolt strategy.
It is first and foremost about reduced time in the sea, means less sea lice treatment and improved fish health. If you have the fish in the sea for, let's say, eight months, on the back of a 1 kg large post-smolt, and you see clearly benefits, which is also demonstrated and documented by many farmers. And the reason for that is that less time in the sea has a value in itself, because there is a certain accumulation of diseases, and in particular, sea lice, over the number of months. So in that sense, eight months is very much better than 17-18 months. Also, on the back of reducing the production time in the sea to eight-nine months, dependent on the size of the smolt, there is a better utilization of your license.
And probably it comes with the ballpark, a volume increase of 30%, of course, dependent on the size of the smolt and other conditions. Then importantly, the outlook of the post-smolt market in Norway, the way we see it, it is, it is a slower market than I would say expected, given the reduction of the resource tax from initially announced 40%, down to 25%, and also the benefits from the post-smolt strategy, which I already reflected above. So our customers, and they want currently to know all the implications from the new resource tax. And here I want to stop for a minute and just share some few personal reflections.
The way I read the reports coming out these days is that there is an effective tax rate, which will vary from 10%-20%, based on the reports I have seen from different companies recently. So nominal tax is of course 25%, but the effective tax will be quite a bit lower on the basis of the complete value creation and EBIT for the company. Also, based on data we have seen, we think that Norway is still the most profitable region to farm salmon, also after tax, net of corporate tax, and also the resource tax specific for Norway. So even, even you take that into account, we believe Norway is still the most attractive place to farm salmon.
Resource tax is here to stay. It will not go away, we believe. However, the burning issue these days is more, how will it work in practice? And I think the only thing to say about that is that this process will still take some time before the farmers have got all the answers to all their questions. And there are various topics there still. And in addition to all those more fact-based things, and this is probably even more seriously, it is also about lack of trust. And lack of trust between the industry at the one side and the government on the other side. And here, my take on this situation is that the avenue of trust, that's a two-way street.
Anyway, it will take some time before we see a new normal, and a new normal comes with an investment level, also with regards to bigger investments on land. So our view is clearly that it will be a new normal, but we do not have a view on the timing of that thing. So on back of this, we will say we do not expect to sign any new RAS contracts in Norway for the rest of 2023. But still, we have a lot of work in progress here, so the pipeline of prospects is solid. But once again, it is uncertain when customers will make a final investment decision.
A few words about the NOAP, the projects Nordic Aqua Partners is doing in Ningbo, in China. And that will be finished in Q1, reported by NOAP. So they will start harvesting fish end of Q1, based on their reporting. Construction of NOAP Phase One will, for the most, be completed in 2023, but the last RAS module will be finished early 2024. We have started the work on NOAP Phase Two, which is an additional new contract for an additional capacity of 4,000 tons. And AKVA has also signed another, a third RAS contract, phase three, with additional annual capacity of 12,000 tons. And that, the startup of that project, that is to be authorized by NOAP in the future.
That brings me very much to my last slide, the conclusion on land-based so far. So this is about our expected activity level for land-based. As you have seen, the total order backlog is NOK 1.7 billion. 50% of the contracts behind the NOK 1.7 billion is with the nature of a cost-plus terms. And the other 50% is on the nature of fixed price terms, but with cost escalation mechanism. And the old contracts with historically low gross margin and no cost escalation, they will be finished end of this year.
So just to remind you, during 2023, AKVA has signed the following contracts: NOAP Phase Two , with a contract of NOK 40 million, that's full growth, and that project is just started and will be executed over the next two-three years, more three years than two. And the same with Cermaq, that's a EUR 60 million post-smolt contract. Project started, that means design and engineering, but also that will be executed next two-three years and more three years. And also, we have signed two RAS contracts outside Norway at approx. NOK 16 million, which is also to be executed over the next couple of years. All this—these are included in the NOK 1.7 billion, certainly.
So with the basis in these contracts, we like to say that the activity level for 2024 will then be a minimum of NOK 600 million. Project margins is expected to improve significantly, and also OpEx will be reduced, now I'm talking 2024, will be reduced to the right sizing process we are conducting right now. Consequently, on the basis of this minimum NOK 600 million and the measures taken, we expect to do a slight positive EBIT for 2024. We still hope to sign more contracts in the months to come, which can have some activity and impact for 2024. But that's, it's hard to guide on this, given the standstill we see in the market now. And that's why we have decided we will give you a more further update on this when we report Q4 into in February next year. And that brings me very much to the end here. So I'd like to hand over to Ronny Meinkøhn, our CFO. Please, Ronny.
Thank you, Knut, and good morning to everyone. I will give you some more details regarding the financial performance, the mixed financial performance in this third quarter, and also the financial position to AKVA group. So I will start off with the group financials, and then I will continue with the financial performance in each of our three business areas. So revenue came in at NOK 817 million in Q3, which is NOK 23 million lower than Q3 last year, while revenue year to date is just about NOK 2.6 billion and at the same level as in 2022. EBITDA ended at NOK 78 million in Q3, which is NOK 53 million higher than a year ago. However, EBITDA in Q3 2022 was impacted by the NOK 58 million in restructuring costs.
So comparing apples to apples, EBITDA in Q3 this year is NOK 5 million lower than last year. EBIT in Q3 came in at NOK 29 million, which is NOK 88 million above last year, and the EBIT impact of the restructuring in Q3 2022 was NOK 98 million. So again, on a like-for-like basis, EBIT is NOK 10 million lower in Q3 this year compared to last year. EBIT year to date is NOK 77 million, which is NOK 21 million higher than last year, adjusted for the NOK 98 million in restructuring costs. So we have high net finance costs in the quarter of NOK 32 million, but lower than the NOK 49 million last year, and the NOK 49 million in Q3 2022 included a write-down of the loan to AquaCon of NOK 28 million.
So adjusted for this write-down, the net finance costs in Q3 this year is NOK 11 million higher than last year. And this increase, that's mainly related to increased interest rates and total interest costs, including the IFRS 16 interests, amounted to NOK 23 million in the quarter. And then we had a reduced market value on our investment in Nordic Aqua Partners of NOK 3 million. And last, we had this unrealized negative currency impact of NOK 5 million related to an intercompany loan that is not possible to hedge. So the revenue of NOK 817 million in Q3, that is 3% lower than Q3 last year.
We still have a respectable book-to-bill ratio the last 12 months of 130%, with order intake of NOK 4.4 billion and revenue of NOK 3.4 billion. Compared to Q3 last year, we see somewhat reduced revenue in Sea Based and Land Based, while Digital continue with a strong positive development and a revenue increase of 32% quarter-on-quarter. Market-wise, we had increased revenue of 9% in the Nordic market in Q3 compared to last year, while there is a decline in revenue in other markets. On segments, Sea Based was 81% of the total revenue in the quarter. I already mentioned Digital with a strong increase of 32%, while revenue in Land Based and Sea Based was reduced by 7% and 3% respectively.
Despite the headwind in Land Based, we continue to see an overall positive EBITDA development with a margin of 9.5% in the quarter. We have commented in our last quarterly presentations the reason for this low profitability in Land Based, which is partly due to a high-cost base compared to the current activity level, which became very visible in this third quarter, and partly due to low profit margins on parts of our project portfolio. I'll comment more on this later when I talk specific about Land Based, and also how we expect this to develop into Q4. There are acceptable EBITDA margins, both within Sea Based and Digital, and we are pleased with the current product mix in Sea Based, contributing to a solid profitability in the quarter.
So available cash was reduced by NOK 4 million in the quarter, and we have NOK 426 million in available cash at the end of Q3, including the available credit facilities in DNB. And we are very, very pleased with the development in net working capital during the quarter, which was reduced from 11.6% in Q2 to 8.6% in Q3, which is a reduction of NOK 106 million. And the reduced inventory levels of NOK 46 million, that is the big contributor in this improvement. The covenant situation is still tight, ended at 4.35 in Q3, compared to the threshold of 4.5. And as we informed you during the Q2 presentation, we expected the headroom to increase in Q3, but that did not happen.
And the reason for this, that is the still slow post-smolt market in Norway and delay in some of our land-based projects, which had a very negative impact on our profitability in Q3. We are still confident that we will manage within the covenant going forward. So net interest-bearing debt was reduced by NOK 35 million in the quarter, and the big ticket into this is the improved net working capital of NOK 106 million. On the other side, we see high interest costs of NOK 23 million and also CapEx of NOK 44 million. Year to date, we have an increased net interest-bearing debt of NOK 100 million, where the increase in net working capital is contributing with NOK 89 million out of this NOK 100 million.
So total CapEx of NOK 44 million in the quarter, where NOK 18 million, that is related to our innovation agendas, one for each of our business areas, and another NOK 8 million is related to our global ERP project. And we will have an important milestone coming up first half next year, where we'll go live with this ERP system in three of our operating companies, and then we will continue with the rollout to the rest of AKVA group over the next few years. So total CapEx year to date is NOK 140 million, where NOK 56 million is related to innovation and NOK 38 million is related to this new ERP system.
We informed you also during Q2 that, due to financial performance below expectations, the company decided not to pay any dividend for the second half year of 2023, meaning that we will not pay any dividend for the year 2023 as such. Now move on to the three business segments, and I will start off with the Sea Based Technology. The total revenue in Q3 was more or less in line with last year, a slight reduction of 3%. On the other side, we have an increased order intake of 28% in the same period. Solid EBITDA margin of 11.9%, compared to the 11.5% in Q3 last year. That is due to a well-balanced product mix in Sea Based, supported by the commercial breakthrough of deep farming concepts.
On regions, in Nordic, we had increased revenue of 9% and a strong increase in order intake of 73% compared to Q3 last year, and this order intake is fueled by new sales of deep farming concepts. In Americas, we have reduced revenue of 8%, while the order intake increased by 29% in the same period, which is driven by higher activity in North America. And last, revenue and order intake in Europe and Middle East was reduced by 36% and 53% respectively. And as Knut mentioned, Turkey has been the main contributor in this region the last couple of years, but is now experiencing challenging macroeconomics with high inflation rates and high interest rates, which also affects our operations in Turkey.
We have reduced the short-term expectations in this region. Despite no new barges so far in 2023, we are pleased to see the latest development in the 12-month order intake trend for sea-based this shift, and the order backlog of NOK 731 million at the end of Q3 is NOK 59 million higher than a year ago. Compared to the last three quarters, the order backlog end of Q3 is lower, but please remember that there is a very limited amount related to barges in our current order backlog. On the other side, we see positive development in new sales of other products and so and solutions, like the deep sea farming, that to a large extent compensate for the lack of barges.
We also have very strong momentum with regards to the OpEx-based revenue in sea-based, which was 33.1% of the total sea-based revenue in this third quarter, and NOK 45 million higher than Q3 last year, which is an increase of 20%. We see the same trend year to date, with a total revenue of NOK 755 million and 19% higher compared to 2022. For land-based, it's close to zero order intake in the quarter. Revenue was decreased by 7% compared to Q3 last year, but more relevant, the revenue was reduced by almost 30% compared to Q2 this year. Meaning that we are now completing projects without new projects and starting up to the same extent. The profitability is very low in the quarter, with EBITDA of NOK 11 million, and we have discussed the background.
I want to repeat myself. So first, we have a too high cost base compared to the current activity level, and this became even more visible than we expected in this third quarter. And we believe that the reason for the lower activity level is a direct consequence of the resource tax in Norway. And secondly, a significant part of the revenue in Q3 is still related to projects with low profit margins. So the profit margins in this part of our project portfolio were written down significantly last year and are related to old contracts which don't have the mechanism for price escalation. So the remaining work on these low-margin contracts is for the most completed in Q3, but will also have impact in Q4 due to project delays.
So our land-based business is very sensitive with regards to revenue level, and I'll just provide you with a simple EBITDA bridge between Q2 this year and Q3 to illustrate this. So in Q2 this year, we had a negative EBITDA of NOK 4 million, with a revenue of NOK 173 million. In Q3, the revenue was reduced by almost NOK 50 million, but we have maintained the same cost base. We have maintained the same capacity with regards to personnel in the belief that the market would improve. So the NOK 50 million in low revenue has a negative EBITDA impact of NOK 7 million-NOK 8 million, explaining why we dropped all the way from minus NOK 4 million in Q2 to minus NOK 11 million in Q3.
Due to the slow post-smolt market in Norway, we have implemented measures and will adjust the cost base to reflect the expected activity level going forward. This right-sizing process will be done in Q4, which will target NOK 25 million in annual cost savings. That will have full impact in 2024. Last, with regards to the short-term expectations, we also expect the profitability to be low and negative EBIT in Q4. The impact from the cost savings will be close to zero in Q4, and we will still have impact from projects with low profit margins, and the activity level is not expected to increase compared to Q3.
So the 12-month revenue trend is a flatliner for land-based, and we had a peak in the order intake earlier this year with the award of the contracts from Cermaq and NOAP for Phase Two. In Q3, we were not awarded any new significant contracts, and we don't expect any new contracts in Norway in Q4 either. And the order backlog, NOK 1.7 million, is NOK 0.9 billion higher than a year ago, but just to repeat what Knut said, delivery time of the order backlog, it's closer to three years, which mean an annual revenue of approximately NOK 600 million. And last, digital, steady and strong development, increased revenue of 32% in the quarter, compared to last year.
Please note that a significant part of this revenue is on a recurring revenue model, meaning that new orders, new order intake, will come on top of existing revenue streams. EBITDA margin was down from the high 38% in Q3 last year to and ended at 30% this quarter, which is still acceptable. The trend on both revenue and order intake is positive and is confirming the positive trend we are seeing for our digital business. Order backlog of NOK 150 million at the end of Q3 is a solid increase from the NOK 95 million in Q3 one year ago. So that was my financial update. I will give it back to Knut to close off this presentation.
Thank you. Thank you very much, Ronny. Just quickly summing up and sharing the outlook. Salmon prices expected to remain strong, driven by reduced supply. Once again, the implication of the new introduction of the new resource tax in Norway are negative, both for the land-based business and parts of the sea-based business. We believe there will be a new normal, which will enable investments again, but we don't have a view on the timing of it. Measures will be taken in Q4 to adapt the cost base to the current and expected activity level. Due to the changes in market conditions, AKVA will revise the medium-term financial targets during Q4, which is to be reported in February.
But saying all this, AKVA will continue to invest and improve our solutions, both within sea-based, the digital, and land-based technology. And that brings us very much to the end, which is the Q&A session. So we like to open for any questions, and please post any questions, and our moderator will read the questions. So any questions, Ståle?
We have one question from Ola Trovatn in DNB. How much of revenues in land-based for Q4 will be from old contracts versus new contracts?
Generally speaking, that will be a mix. I don't know whether you can quantify it.
No, no. I would rather say 50/50. That's my best estimate, because there are some project delays in the older contracts that will slide into Q4, and then we have the closing of the old project. So my estimate is 50/50 of the revenue.
Thank you. Another question from Mr. Trovatn. Is it only barges that are negatively affected by resource tax in the sea-based segment?
I will say yes. We see our digital business is growing steadily, so we don't see any reduced appetite there. When it comes to like more the milk, bread, and butter which is nets, net services, the cameras, the cages, everything it takes to run a farm, we see more of a normal buying pattern there. So the special thing with the barges is that it comes with a relative high CapEx up to NOK 40 million-NOK 50 million per barge, at least in Norway, if you talk about the larger barges. And you always have the option to run the old barge a little longer if you have constraints on your CapEx budget.
We think that is also temporarily. We also think there will be a new normal there. And by the way, with regards to the barges, steel prices has been rather high in big parts of this year, meaning that there have been traded some barges, but more concrete barges. We don't produce the concrete barges ourself, only the steel barges, just to be precise on that one.
Then one question from Mr. Carl Johannessen in Pareto. Any movement in full-cycle land-based projects?
No, that sector is dependent on financing of new projects. So, our only project is NOAP for the time being. We don't have any other projects with financing behind, and we don't want to guide that that is close, either. What we want to say is that we expect a momentum dependent on a positive momentum, dependent on NOAP farming and harvesting salmon in the first half next year. We think that will be the trigger point, when you are closer to proof of concept. That's what we are watching and looking for these days.
Okay. I don't think we have any further questions for now. Perhaps we should give it 10 more seconds, but, no.
Okay, if no more questions, we say thank you for participating. Thanks for your attention, and we wish you a nice weekend. Thank you.
Thank you.