Today we are going to focus on three things. It has been a challenging quarter in what is still a difficult market. We see improvement not only due to the seasonality, but also in the volumes in Q2 compared to Q2 last year, a positive sign for the near future. We are also going to look into the long-term opportunities and the market ahead of us. Welcome to the first quarter presentation for BEWI 2024. I am Christian Bekken, the CEO, and together with me, as always, our CFO, Marie Danielsson. EU has set a target to become climate neutral by 2050. To reach this, EU has made it a legal obligation to reduce emission by at least 55% within 2030. It is only five years to 2030, and there is an urgent need to improve efforts if we are going to reach that target.
In this picture, you see some colleagues of mine in the middle, Ahmad and Jonas, with some friends in Sweden on the World Cleanup Day. We in BEWI know that we make products that are protecting people and goods for a better everyday, like, for example, helmets to protect children when they are out bicycling. But we also know it is important to take responsibility, responsibility to reduce CO2 emission by insulating more so that we use less energy, to recycle more, create less waste, and make the Packaging even more sustainable, also to lower our emission to mitigate climate change. In BEWI, we see this as our greatest business opportunity. The first quarter was difficult, and we are not pleased with the result. We try to do our best, and it's challenging when the effects are delayed.
Our revenue of EUR 244 million, EBITDA of EUR 19 million, EBITDA margin of 7.6%. We are going to use our energy on further improvements, not on excuses. But there are some explanations. Challenging market conditions in an already weak season, a winter with a lot of snow in the Nordics, makes it very difficult when you are exposed to the construction market. On top of this, Easter came in March this year and in April last year. We have a positive margin, but we are not satisfied, and we will continue to improve and to cut costs going forward. Going into the second quarter, we experienced stronger demand so far compared to the same time last year. In one of our biggest and most profitable markets, Benelux, we see this year 10% higher volumes than we saw last year.
We actually see positive signs in all the divisions, and that is very promising. The ramp-up of the new production line in Etten-Leur with high-margin products is going well in Q2. In the insulation market, we see increased volumes also in Denmark, and we are gaining market share in Finland, especially in XPS. In Packaging, we will have a positive margin effect coming from a lag in price agreements. In Automotive, we continue to grow volume, taking market shares. In Circular, we see higher margins, and we are already almost sold out for volumes in Q2. All this is clear indicators on better market conditions going forward, but it will take time. What will speed up this process is the regulatory changes, like renovating houses with more insulation.
We in BEWI will continue to deliver on our key priorities: more recycling, capacity adjustments, and cost reductions, capitalizing on our investments, strengthening our cash position, first step EUR 100 million in Q2, and then evaluating strategic opportunities for growth going forward. BEWI have invested over EUR 50 million in recycling over the last six years. In 2023, we produced over 50 million fish boxes, and that is 30,000 tons of material. But more importantly, we collected 27,000 tons of EPS, 90% of the fish box volumes we produced. BEWI's next target is to collect and recycle more than we produce, and there are not many companies in the European industry that can say the same. I'm very proud of that accomplishment from our organization.
We have worked for over five years, testing, failing, improving, developing, and of course, as I said, investing over EUR 50 million to be able to recycle as much as we produce. This will be BEWI's largest competitive advantage in the future. Now it's just a matter of time before we reach these targets. And looking at the regulatory changes in the EU, this is about to happen right now. 2030 is only five years away, and that is the last time we have to change. As an example, Packaging with 30% recycled material is one of these regulatory requirements, and BEWI, we can fulfill that today. BEWI is also one of the biggest producers of reusable boxes for the food industry, and 40% of reusable boxes is the target for 2030.
The solution is not to delay the implementation, but to work together with fact-based knowledge to find the right solutions. With that, I leave the word to you, Marie.
Thank you, Christian. Seven quarters. We have actually been in a declining market trend for the seventh quarter. It was in the third quarter of 2022 that we started to notice the declining volumes in the Nordics in insulation. After that, the volumes in RAW followed, and the volumes in other countries in the insulation and construction segment followed. Then approximately from mid-2023, also demand from other industrial segments started to decline. In this first quarter, sales are down approximately EUR 52 million. EBITDA is down approximately 9.5%. As Christian mentioned, of course, we cannot say that we are happy with this, but we are quite pleased with how the organization and the company have managed over all these quarters to adapt to the market situation.
We are also pleased to see how resilient the business model is to be able to still deliver results on these levels after so many quarters in this environment. That's not just because of what we deliver here today, because it's also important, because it says something about what we can do when the market turns around. The overall picture is that the volumes are down in most regions across the segments. Again, due to that, the market is still soft. It has been an extremely long, cold, wet, snowy winter. On top of that, we had the Easter break in Q1 this year compared to Q2 last year. In our downstream segments, we have remained the margins at the same level as last year, even if the volumes are down.
But that is not the case in our upstream. I think that is the disappointment, if I can express it like that, that our upstream segment has not only had a challenge with the volumes but also with very volatile raw material prices, the styrene prices. That has been hard to maneuver from a selling price perspective. I will come back to that when I speak about segment RAW. But the result could have been a few million better in our upstream segments. Circular's selling prices, they pretty much follow the virgin prices, so they are impacted by this fact as well. A few things, if we just look at the full income statement. Again, sales are down 18%. As always, that's a mix from price and volume. We are taking down the cost base.
Part of this is, of course, related to the lower volumes, but in fact, fixed costs are 5% lower compared to last year. That is for all the different measures taken. So is the personnel cost slightly down from last year. We have, unfortunately, been forced to take out 150 employees or FTE. Then we have the salary inflation. It has been a quite high salary increase last year, which offset part of this, but we are still on a lower personnel cost level. Depreciation is stable or on the same levels as last year. Financials are slightly up, and that is, of course, due to the increasing policy rates if we compare to last year. Cash flow is then negative, but definitely not a surprise. This is in line with what we expected. Why is that then?
Yeah, that's, of course, because you do have a seasonality impact in Q1 in working capital. You end Q4 in December in low season. You end Q1 in March when you're about to go into high season. So we have a working capital impact in the first quarter of -EUR 25 million cash flow. And all of that is more or less related to accounts receivable. And then we have said for a quite long time that we are focusing on the working capital and how can we reduce that. And of course, inventory is something that we work extremely hard with. And then you might have picked up that inventory is actually increasing slightly. Now we're talking about a few millions. And this is again then coming from that we have had an upgoing price trend in the raw materials, approximately 5%-10%.
That means that we tie more capital into the whole value chain. The volumes in inventory are actually down, but then due to increasing prices in euros, it's up. We have CapEx, which we also have been talking about a lot. That is still in a totality on a quite high level in Q1. That will continue in the second quarter because we are now in the end phase of paying the last installment of all these organic growth initiatives, which Christian will come back to what that means for future earnings. I want to emphasize, and that should be very clear, that the target of EUR 20 million in CapEx in 2024, that remains. Again, this is what we expected for the first quarter. You can also see that CapEx related to maintenance CapEx, that is decreasing significantly versus previous quarter.
I'm back to my seven quarters in a declining market mode because that, of course, means something to the financial KPIs, which then also for seven quarters has gone in the wrong direction. I think it's fair to say that what works against us the most at this time is the earnings. And with that said, that we are not continuing having a high priority on the balance sheet, but it's still the earnings that make the difference at this time. If we compare our net debt to March last year, we have taken down net debt ex IFRS with EUR 20 million. And on top of that, we have made available an additional EUR 20 million in our RCF. So that's an additional EUR 40 million. And then an easy conclusion is to say that, yeah, but you divested real estates. And that's true.
And if you look at the rolling cash flow, you have all the divestments in there. But those money has to a large extent been spent on all these growth initiatives so that we have been able to take down the debt that is mainly related to the normal operational cash flow. I know that I don't know if we've said it externally before. I know that Christian mentioned it earlier in this presentation, but we decided for some months ago that we should have a minimum of EUR 100 million cash available because that is so important in these markets. By the end of this quarter, we are close to EUR 80 million. That's EUR 78 million. We know that we have real estate transactions coming in, EUR 10 million already closed in the second quarter. There is an additional EUR 10 million that adds up to EUR 20 million.
We have a compensation for an old acquisition of close to EUR 8 million coming in, which means if I make the math for you, that we have the 78 and we could add approximately EUR 28 million to that. So we are at those 100 already at this time. And to summarize again, just to repeat myself, balance sheet, main focus, we continue to do what we can to strengthen the balance sheet. And we believe that when the market turns, that also means that we are greatly positioned to turn around the KPIs that we have and reach back to our targets again. So then looking into the segments, RAW mentioned still struggling with the volumes following the soft market. The EPS prices, the selling prices of RAW, official prices have declined approximately 7% in this quarter.
That gives you a feeling about how much of the decrease is related also to volume. We believe that, yes, these volumes, of course, it's market-driven, but as said before, we also have had a tough winter. We also had the Easter season. So there are different impacts in this volume drop. And then also what we still experience is that our customers, they are still very cautious on building inventory. So normally when you could see them building inventory end of Q1 to be prepared for the high season coming in the second quarter, that has not been the case this year. And then also mentioned before, it has been a volatile styrene market in the first quarter that continues also into the second quarter.
That means that the perception on what is the market price for EPS is very different from different customers, of course, but it deviates from the price that we pay for the styrene. And that has pushed the margins further down. So while the selling prices have declined 7%, the styrene prices have more or less been flat. And that impacts the RAW segment's EBITDA in the quarter with EUR 2 million because that means a lot to the results. Insulation then, same story. Still a soft market impacted by exactly the same reason as mentioned for RAW. We are very pleased with that. It seems like the volumes are in April and May increasing if we compare to last year. And we are also very pleased with still the operational and financial performance that the segment do after all these volumes in a declining trend.
They deliver margins on the same levels as last year. And of course, that means that all these restructuring schemes that we have been pushing through and the work that we still are doing and also all the synergies from all the acquisitions, they have impacted the financials for the segment. I think it's also worth mentioning that the results in the Nordics in Q1 are essentially better compared to Q1 last year. And then we have the opposite in Benelux and in Germany. And that goes quite hand in hand with also how the downturn started. It started in the Nordics, and then it came by the end of Q2 in Benelux and the German region.
Now we can see that the performance is catching up in the Nordics, and we still haven't managed to handle, but we are still not there yet in the Benelux and Germany. U.K. and Spain that have been performing on good levels, I would say, over these quarters, both volume-wise and also financially, they continue to deliver on these good levels. So still not any big signs of a poor market in these areas. All right. Packaging components, it's always a mixed picture in this considering that there are so many different industries behind this segment. But we are very pleased with that Automotive continue to deliver stable volumes, stable financials. Approximately 20% of the sales in this segment is now related to the Automotive segment. Then we have the fish boxes. Last year, the first half was quite weak volume-wise for the fish boxes.
Seems to be the same this year. That is driven by the biological challenges that you have out in the sea here in Norway. The difference then compared to last year is that last year, still the more industrial customers and HVAC in particular, they were still an upgoing trend. I think that we also in the second quarter said that HVAC is still strong. Then it went down from the mid of last year. That explains the difference compared then to Q1 last year. But positive then is that if we compare to Q4, the industrial segment is now performing better. That is both driven by that the volumes are slowly picking up, but also all the different restructuring schemes that have an impact to the financials and the performance. So we are pretty much delivering on the same levels as in Q4.
That's a combination between an improved industrial segment. We have some weaker results in the Automotive segment. Then just to end with Circular, Christian mentioned that we have invested a lot in our Circular segment. We continue to do so. We believe that it's so, so important to have access to recycled materials in the future. But we are struggling on the profitability. I would say it's two main reasons to this. One is more the market because the Circular, the products that we sell, the recycled material goes mainly into insulation products in the market this, as you know, week. Then it's about the price. Still, it's hard to get paid for recycled material. Now the virgin price is on a generally low level or has been in the first quarter.
That means that the preferred choice is still virgin over recycled material unless there is a price advantage. Again, we cannot do anything more than continue to invest and believe in Circular because this is the future. We believe that we will have a great competitive advantage by our Circular segment. The market needs to mature. We believe that it will soon do so. It will be supported by the legislation that will come in Europe and already is implemented in a few countries. When that happens, it means that demand will increase and also the sell prices. With that, I leave the word back to Christian again.
Thank you, Marie. Strategy and outlook. Here you can see a picture from Lithuania, a commercial building with PUR sandwich elements and insulation from BEWI. As you can see, the roof is covered by solar panels. A good picture of the future, the future of commercial buildings, not only preserving energy but also producing energy. Still, it is a challenging market, and we are focusing on capacity and cost optimization. But we are also preparing us for growth that will come both operationally and strategically. Our strategy is firm, and our long-term financial targets remain the same. And we will be in position to take advantage for further growth when the market rebounds. As we have stated before, our ambition is to double the revenue the next three to five years with increased exposure, like you see here, towards insulation and energy-preserving products.
The greatest challenge of our generation is climate change, and the solution is to mitigate it. 40% of the energy consumption in the EU comes from buildings. 75% of the buildings built before 2000 are not energy efficient. Climate change requires more energy-efficient buildings. For the EU to reach its climate reduction targets, renovation is required at large scale. A new building must be zero emissions by 2030. BEWI is already a leading European insulation provider, and we will continue to strengthen that position. We need more buildings, but the main growth will come from using more insulation. As you can see on this illustration, in the 1990s, we used 10 centimeters of insulation. Today, we are using more than 30 centimeters of insulation, and regulatory changes will continue to put pressure on using more and better insulation.
Insulation products are the most important product in the construction industry because the best way of saving energy is not using energy at all. Here you can see an example, a picture of a zero-emission building from Løren in Oslo, 2,400 square meters with GreenLine EPS including 100% recycled content, saving in production 67% of CO2 compared to the conventional production. Without any doubt, the future way of building buildings. That puts BEWI in a good position. As the figure shows, when we see a rebound in volumes on 35%, the earnings uplift potential for BEWI insulation would be over 70%. That is with the cost structure and margin level we have today. On top of this comes positive effects for the other segments as well. Remember then that 35% volume uptick will still be approximately 20% under the market we saw in 2021 and 2022.
Then we will have the same EBITDA as we had at that time, around EUR 200 million, but at that time we had 20% more volumes. We have already invested for the future, and the next years we will be capitalizing on these investments. When we are up and running, this will add also EUR 75 million in sales and in organic growth on new markets for BEWI, as you can show in this picture. To summarize, it has been a challenging quarter for several reasons, but we see positive signs going into Q2. It's not the seasonal effects, but positive signs in terms of volumes and markets. We continue to improve our operations, and we are continuing to cut costs. A priority for us will continuously be to strengthen our balance sheet and at least reach EUR 100 million in cash in Q2.
The strong fundamentals and growth opportunities are still ahead of us. With that, I will open for questions.
Thank you, Christian. We will start the Q&A session. My name is Charlotte Knudsen. I'm responsible for investor relations and communications. You can post questions in the webcast console, so please do, and we will read your questions. The first one is from David Nielsen. How much of the revenue decline in Q1 this year compared to Q1 last year in the insulation and construction business is driven by volumes and pricing, respectively?
Of course, that differs from region to region. But if I remember and I do the numbers correctly, it is between 15% and 18%, which is from the volumes. Also, the decrease in volume is between 15% and 18% in the quarter for insulation.
Thank you. And the second question also from David. This one goes to you, Marie. How do you view the risk of BEWI running into liquidity and covenant issues over the coming quarters and into 2025?
I assess that risk as being low. As you can see, we have approximately close to EUR 80 million in available cash end of Q1. We have control over further cash coming in. We have the EUR 20 million from the real estate. We have this compensation of another EUR 8 million. So unless anything happens that we are not aware of as per today, I assess this risk as low.
Thank you. Then another question also from David, again referring to the insulation and construction business. It would be helpful if you could provide some insights on BEWI's end market revenue mix. How much of the revenues, approximately, comes from new build versus renovation and also the split between residential and non-residential, also referred to as commercial buildings? Christian, please.
The split in general between new build and renovation is 70% new build and 30% renovation. Of course, that differs, and we see things, for example, now increasing renovation. For example, as I showed in the presentation, the flat roofs which are re-insulated and putting solar panels on top of it, then they use our insulation, hard insulation, very often XPS. The split between building houses and commercial buildings is approximately 20% commercial buildings. That is also increasing now compared to housing in the times we see now. That is a general figure.
Good. Thank you, Christian. Then we have a question from Herman Dahl, analyst at Nordea. How is the order intake in insulation and construction segment so far in the Q2 compared to the same period or the same quarter last year? Christian, please.
Yeah, I touched upon some markets in the presentation, like Netherlands and also Denmark, which is the stronger part of it, which we are very pleased with. But in general, we see that the demand and order intake is approximately 10% higher this Q2 compared to Q2 last year. Yeah.
Okay. And then another question from Herman in Nordea. What? I have to translate this one. How much do you think for further cost reductions beyond the synergies already extracted and the cost cuts you have implemented related to the low demand? What's the kind of further potential for that?
That is a very difficult question. And of course, when the market goes down and the volumes go down, it becomes harder and harder to take out costs, but to put a limit on cost reduction, that is, for me, difficult. The only thing I can say is that we will continue to adjust to the existing market and cut costs where it's needed. And of course, we have 80 factories, so there is no clear picture here and there, but we see no clear limitations of cutting costs. But obviously, there is more and more difficult to cut costs the more the volumes go down. But in the situation we see now in Q2, it is that the volumes are up. So we will continue to do the best we can.
Thank you. Then there is one from Henrik Larsen at Carnegie. Are you worried about any credit losses on your receivables? Also saying that quite a lot of larger construction companies have gone bankrupt lately.
I don't know if you want to fill me in here, Marie, but as we said, 70% of our turnover and also where we see the increase in the last month is in the early stage of the construction phase. We have a track record with the companies we are joined together with over 40 years. Credit losses is something we monitor and we insure ourselves against. So that has never been, and we don't see it as an issue now. But of course, it's because we are taking care of that issue. But Marie, I don't know.
No, I think you are correct. I mean, credit losses is always a risk. We take the measures that we can. We have credit insurance, and that isn't only an insurance, but there's also works that you get credit limits for your customers. So early on, you get customer at risk on the radar and can take action upon that. Historically, we haven't had any major losses, and it has been poor markets before. But of course, it's always a risk, and we monitor it.
Thank you both. Again from Henrik at Carnegie. How many tons of EPS did you recycle in Q1? And are you worried you will not reach the goal of 45 tons or 1,000 tons of EPS recycled by the end of 2024?
It's a very good question. A part of the reason of our not satisfying results in the quarter is because we are increasing the recycled volumes in the quarter. With frustration, I see that it is not paying off to recycle material now, but I think that will change. I see that it's already changing in Q2. We do believe that we are bad wording, but we have control over the 45,000 tons, and we also have control to get it profitable already, or at least at zero already in Q2. We are in line with our targets. The recycled tons for Q1, I don't have it in my head.
No.
I think it's around.
I think it's slightly up from Q1 last year, at least.
Yeah. But then we'll come back to that number.
I can also, I think it's about 5,300 tons, and you should not kind of it is approximately the same as Q1 last year, so 5,300 tons, something like that. And last year as well, it was lower in the Q1 than in the other quarters. So yes. And then last question for now. Please post if you have further questions. This one goes from Eva Larsen. You are mentioning that the start of Q2 has been better than last year. Given your reduction in cost, does this mean that you expect better results Q2 2024 than Q2 2023? Christian?
It's a very difficult question as well. But if it continues like we see in Q2, I expect that. It's difficult to answer for that long-term perspective. But again, what we see in Q2 was what we are seeing now in Q2 is positive. And if that continues, yes. But there is no guarantee for that. As I said, I think this will be a case which will take time.
Thank you. We have no further questions from the webcast. We thank you all for listening, and thank you for posting questions. Hopefully, we will see you again in August. Thank you.
Thank you.