Welcome to this presentation. My name is Christian Bekken, I am the CEO of BEWI. With me today, as always, I have our CFO, Marie Danielsson, who will take you through the financial. Our presentation includes some forward-looking statement, I would like to point your attention to our disclaimer. Let's talk about the highlights for the quarter. I am very pleased with our performance and results for the quarter, including how we worked with synergies from the combination with Jackon across our organization, resulting in a doubling of our estimate for synergies to EUR 30 million. Yes, our EBITDA is down compared to the first quarter last year, our performance this quarter is perhaps stronger. The first quarter last year was extraordinary, with high prices and high demand, especially for the raw segment.
Since then, EPS prices are down with approximately 15%-20%, volume for both raw and insulation and construction segments are significantly reduced due to lower activity in the building and construction industry. Approximately 60% of our business is exposed to this industry. Yes, we are very pleased with the result given the current market conditions, and I will come back to why and how later in the presentation. The market for food packaging remains quite stable, and we continue to capture market share from our organic initiatives, like the new fish box facility at Senja and the fish box under development at Hitra. As always, the slaughter volumes vary as the salmon doesn't care about quarterly result.
Volumes were lower for the first quarter, a little bit low in the second quarter, but there will be plenty of fish to slaughter in the coming quarters. The market for EPP components is growing, including the demand for heating, ventilation, and air conditioning, so-called HVAC systems, and for automotive components as well. This is something we have seen coming for quite a while now, which is why we have made sure to position ourselves in these market segments. Finally, the lower raw material prices which impact the top line for raw support improved margins for our downstream units, like we have communicated many times before. Why are we so pleased with our own performance this quarter? Because we deliver on all our key priorities, aiming at building a robust platform to reach our strategical and financial targets. One, successful integration.
Last year, we acquired seven companies, adding EUR 600 million to our top line, which of course puts an enormous pressure on us to make sure that we integrate these companies well into our existing business. That work is going well, really well. Previously, we have communicated a synergy estimate from the contribution with Jackon of EUR 15 million. Based on the work we have done, we have identified synergies of approximately EUR 30 million, and we are expecting to extract these synergies during the coming year. 2. improve profitability through actively adjusting our capacity and cost to the current market. We are always continuously adjusting our production capacity, and this is a key success factor to BEWI. For example, we have managed to keep a solid gap for raw despite the lower volume since we have reduced our capacity.
Last quarter, we said that we are initiating measures to improve the profitability to the Nordic installation business, we see good results from this already, although we are not happy yet. Jackon's installation business had a negative contribution to our EBITDA. Now this part of the business is delivering positive EBITDA. 3, strengthening financial position through divestment of 4 properties for around NOK 350 million. 4, we have significantly increased our own consumption of recycled material, which is very important for us in order to reach our strategic targets to become a circular company. Last but not least, we have a series of organic growth initiatives which are on track to position us for further growth within more profitable product segments such as fish boxes, paper packaging, and EPP components.
Let's take a closer look at the financial result for the quarter. Overall, we are happy to deliver positive organic growth for both our downstream segments, taking into account the decline in volumes. Net sale grow from 230 to EUR 296 million, an increase of 29%. The organic growth from the group is negative with EUR 25 million, explained by lower volumes to RAW and Insulation, as well as raw material prices. Jackon contributes with more than EUR 75 million, while other acquired companies add on EUR 30 million. Currency effect and divestment have a net negative effect on EUR 14.4 million and adjusted EBITDA on EUR 28 million. Down 18%, as I said, still a very strong result. Again, the decline mainly comes from the lower volumes and reduced gap for RAW.
Both downstream segments deliver organic growth in EBITDA despite reduced volumes, which is especially strong for the installation segments, following strong price management, strict cost control, and ability to adjust capacity. EBITDA contribution of EUR 8.1 million from acquired companies, of which EUR 4 million is from Jackon. A few more comments on the integration work. It is now almost seven months since we completed the acquisition of Jackon. The integration work has been really good. We have established an improved organization structure with dedicated management teams for each division to focus on operational excellence, cross-selling, and strategic growth opportunities. By the end of the first quarter, we had extracted synergies of more than EUR 10 million on an annual basis, and we expect to extract more than EUR 15 million by the end of the second quarter this year.
Based on this, we are comfortable to launch a revised estimate on EUR 30 million during the coming year. Of the synergy extracted, procurement and operational excellence accounts for more than 80%, which is a split 70/30 between raw and installation. In addition to the synergies, we are on track with our initiatives to improve profitability through capacity and cost adjustment for the Nordic installation business. Also the results are already visible as we deliver positive organic growth in EBITDA for the segment, despite a very challenging markets. It is still ongoing work to be done to optimize production footprint and to further reduce cost base in the future. As mentioned, we have established a division-based structure. Each division has its own growth strategy, focusing on how to be best positioned to capture growth from megatrends.
For Raw, we are currently investing in a new extruder at our facility in Etten-Leur, which will increase our capacity by approximately 25,000 tons. This is important investment for us. It enables us to further increase our own use of recycled material in the production, and it provides us with high value grades with a better installation value. In addition, we are looking to increase our capacity to further maintain the so-called raw material balance principle, meaning that we will sell 50% internal and 50% external. Following the acquisition last year, we have increased the internal sales, of course. Berga Recycling has a great platform and will continue to secure waste streams and offer a broad range of recycled material. Within insulation, we will increase the portion of value-added products, more solution system sale, as well as prefabricated elements.
We also continue to expand into other types of materials like PIR and high added value systems like stone wool and PIR sandwich elements. Finally, our packaging and components division, where we look to strengthen our offering of paper packaging as well as increasing our capacity for EPP components to meet the increased demand for HVAC and automotive components. Let's look at a few specific examples on how we do that within the packaging and components division. The market for paper packaging is growing, and we are strengthening our offering and capacity to meet the increased demand. We acquired a Danish paper packaging company, Honeycomb Cellpack, in 2021, now we are ready to invest in the facility to double the capacity. In addition, we strengthen our offering throughout the acquisition of Trondhjems Eskefabrikk last year, which is delivering very good results.
The demand for EPP components is also growing, and we are well positioned to meet the increased demand, basically to fight energy crisis. Following the pandemic, shortage of electronic components impacted the production of both HVAC systems and cars. As the distribution in the supply chain have eased, the production is back and it's growing. Market analysts expect the annual number of installed heat pumps in EU to grow from 1 million in 2021 to 4 million in 2023. We have already invested in HVAC manufacturing machines at our facilities in Skara, which mostly produce components to Volvo. Now also we are expanding in the facility in Santo Tirso in Portugal. Within HVAC, the customers are multinational, such as NIBE, Bosch, and others. To sum up the quarter, we are delivering a strong performance and a robust result in challenging markets.
Our integrated and diversified business model remains a key competitive advantage to us. We have a proven track record of adjusting prices, capacity, and cost to the current market situation, and this is key to be able to demonstrate organic growth in EBITDA, especially in declining market. Successful integration of acquired companies yielding significant synergies, and on track with strategic growth projects focusing on sustainability and circularity, as well as positioning for megatrends, such as insulation, HVAC, components for electrical vehicles. With that, I leave the word to you, Marie.
Thank you, Christian. We start with the financials. Segment Raw. To start with, looking at this slide, it is evident that we have lower sales and EBITDA in the quarter compared to last year. In the analysis, it is important, though, to understand that in the beginning of last year, the market sentiment was very strong with high volumes and raw material price trend was upgoing. This means that the customer bought as much as they could to a high price. We are now in a much softer market, which means that volumes have dropped and margins has become more normalized. Organically, we have negative growth of approximately 25%. Of this, half is coming from price, half is coming from volumes. Jackon contribute positively, do as well have lower volumes compared to last year.
Even so, pay attention to their margins and the fact that even with the lower margins and with more normalized gross margin, the facility managed to deliver an EBITDA margin above 10%. EBITDA decreases from 19.4 to 7.6 as a consequence of, again, volume and a lower gross margin. The lower, more normalized gross margin impacts EBITDA more, compared to the volumes. We go to Insulation and Construction. In this segment, sales has more than doubled compared to last year. Organically, we have negative growth, that means that it is the acquisitions that drives the growth. The majority of this is, of course, coming from the acquisition of Jackon, also it includes the operation acquired in the U.K., in Lithuania, and Spain. If I then start with the organic growth, we assess that the volumes have decreased approximately 20%.
The decrease is much higher in the Nordics, while the decrease is more modest in the other regions. We are extremely proud of even with such a volume drop, we can deliver organic growth, and that is more than 10%. That is due to that we have had quick action to adapt production capacity. We have good price management. We have a general adjustment on the cost structures, and of course, we are favoring from the decreasing raw material prices. EBITDA, excluding the acquisitions, amounts actually to 12.3%. When it comes to the acquisitions, in the quarter, Jackon is the bigger contribution to the top line. Then you also see then Spain and UK and the Baltics.
Jackon, which is exposed to the Nordics to more than 50%, do contribute slightly positive now to the EBITDA, which is an improvement, as Christian mentioned, compared to last quarter. Measures are taken as communicated and continue, and this impacts of course, positively, but we have short-term the market conditions against us. There is no question that what we now are establishing is a great platform for the future with all the integration work that is ongoing. In the U.K. and in Spain, we experience a much more solid market and the operation performs very well. Even if the market is quite tough in the Baltics, those acquisitions contribute an EBITDA margin of more than 11%. To conclude, read between the lines when you see the EBITDA margins of 6.6%.
In a declining market, we are organically improving our EBITDA. Acquisitions excluding Jackon performs very well. Jackon is step-by-step improving but have a challenge in their exposures to the Nordics. Packaging and Components, they increased their sales with approximately 20%, up from EUR 91.7 million to EUR 109.7. We are growing organically, but most of the growth is coming from the acquisitions. In the quarter, it is Automotive and HVAC, those end customer segments that are delivering growth. While there has been, as Christian mentioned, lower volumes of sold fish boxes, and that is due to the lower slaughter volumes in some regions we serves. This is the expectation also for the second quarter, but we do foresee, as Christian mentioned, a strong second half year.
The acquisitions in this segment is mainly exposed to the food industry with both paper packaging solutions and fish box production. The acquisitions are delivering on expectation and have a healthy margin on around 17%. This means that EBITDA is up approximately 45%, up to EUR 13.4 million in the quarter. As you can see, this is a mix between organic growth and acquisitions. The last segment, circular. This is the segment that is responsible for the collection of used EPS for further conversion into new recycled material. We are continuing our growth in our aim to be able to increase usage of recycled content in our products and to be able to close the loop. Last year, we took a huge step forward on the collection side.
We also invested a lot in additional recycling capacity, and consequently, we have been able to increase our internal sales, essentially, if you compare to last year. This is, of course, that we now have more processes and ability to take on these recycled volumes. Financially, yes, weaker compared to last year, then virgin raw material prices were high and again, upgoing price trend. Even so, we are able to earn money in this segment, and keep in mind that still there is no premium on these volumes which we expect for the future. We move into the consolidated financials, and there is only a few things that I would like to highlight. Cost base is, of course, increasing. That is driven by the acquisitions. Personnel cost in relation to number of employees, stable.
If you look at depreciations and amortization, I think I mentioned this before, what's attributable to the operation is the depreciations that you should consider that is our normal CapEx level. This is depreciations on our operational assets. What is attributable to fair value adjustments, that's related to our acquisition value. It doesn't have anything to do with future cash outflow, but it impacts our net income relatively significantly due to the high degree of acquisitions. We have what's attributable to IFRS, and that is part of the rent that we pay on our lease facilities, and that increases due to the fact that we have divested real estates. Financial items also increases. This is of course coming from that interest rates are increasing, but we also do have a significantly higher debt position due to the recent acquisitions.
You might recall that our main financing consists of three sources. We have a bond, we have a revolver credit facility, and we divest our real estate, and that's a leasing debt. You will find all these details in our Q1 report. The bond, which is the major source for financing, has a margin of 315 basis points on your IBOR, and that means that when you have your IBOR going from negative to the levels we are at today, the financing costs do increase significantly. If we then look at the capital structure, you can see that our net debt is rather stable compared to year-end. As you can see, we have a shift between current liabilities and non-current liabilities. This is due to the fact that we have settled debt that was a part of the acquisition in the quarter.
We did some major transactions last year. As Christian already said, those companies had an annual sales of approximately EUR 600 million, and that is a big number considering Beijer's size. Most of these transactions were closed in the fourth quarter. Of course, this impacts our balance sheets and the capital structure. As you can see here, yes, leveraging is increasing and yes, return on capital employed is decreasing. We are currently moving opposites or target. This is, of course, a natural consequence considering that we are acquiring companies on a multiple that is above our leverage. It will take some time before we get the balance between the cash flow generated from these acquisitions, and we have the full potential reflected in our income statement.
Again, the target remains, and we are very confident that we, with the integration and when we take out the synergies, these KPIs will move in the directions again. In the quarter, we have divested additional real estates in the portfolio that we previously announced. The intention is to continue to divest under this framework, and the market value of the residual part of these real estates is approximately EUR 50 million. If we then look at the cash flow, the cash flow was in the quarter positive compared to last year, and this is explained by our working capital, where we do have some movements between the quarter. Q4 last year, we didn't have the cash release as expected. Now we have part of that in the first quarter, and this is mainly related to the inventory.
Speaking very short about the CapEx, you know that we are investing for the future in organic growth. We have spent EUR 7.3 million approximately in normal maintenance CapEx that is in the guided range of 2.5% of sales. Then on top of that, we have the investment programs that is investment in new capacity or in customer-specific investment. Those are the projects that Christian already has spoken about a few minutes ago. With that, I leave the word back to Christian.
Thank you, Marie. To summarize, we experience mixed markets. There is currently low activity in the building and construction industry, which causes lower volumes for raw and insulation and construction. We have adjusted our capacity and therefore maintain good margin. There is a strong outlook for packaging and components with significant growth expected for HVAC and automotive components. We expect strong second half for the food packaging industry. Styrene prices have remained stable into Q2 in 2023. We have a solid progress on our key priorities. We have a continued positive contribution from organic initiatives. We are on track with initiatives to adjust capacity and cost to current markets. We have a proven and a successful integration of acquired companies. We are now estimating to extract EUR 30 million by 2024.
We have key strategy investments in place, positioning us to capture market shares in high growth segments like I've spoken about, HVAC, components for electrical cars, and also for the rebound on the insulation markets. As I have said before, we expect an adjusted EBITDA for 2023 in line with the pro forma EBITDA of EUR 167 million posted for 2022. With that, I conclude the presentation.