Welcome to the 2020 first quarter report from Kitron. I'm Peter Nilsson, CEO, and joining me today for the report is, as usual, Ms. Cathrin Nylander, CFO. During the presentation portion of this webcast, I encourage you to post your questions online for the Q&A session that starts immediately after the presentation. Let's kick things off by taking a look at some of the first quarter highlights. Slide two, please. Q1 2020 is a record first quarter for Kitron. Revenue grew 8%, coming in at NOK 878 million. EBIT improved close to 14% and landed at over NOK 58 million. We booked an impressive 41% growth on the order backlog, generating a backlog in excess of NOK 2 billion. Net working capital ended in the quarter at just over NOK 1 billion.
Although this is an increase compared to the same quarter last year, in the extraordinary corona pandemic situation, holding more inventory has been more important in order to safeguard the company's ability to serve its customers. Reducing capital tied up in inventory remains a key ambition for Kitron, and we will continue working with our customers to advance financial agility. Improvements in earnings yielded an EPS of NOK 0.23 per share, a close to 10% increase over last year. On that note, let's move on to slide three, important events in the quarter. The first quarter has been heavily influenced by the corona pandemic. Since late February, Kitron has had procedures in place to minimize risk to our employees, customers, and suppliers, and to safeguard capacity and capabilities in our production facilities. Besides a brief shutdown in China in February, there's been little effect on Kitron's capacity.
Although sick leave has been higher than normal due to rigorous compliance to rules put in place, capacity and costs have been managed efficiently. All Kitron sites are running at normal or high load. Extended capacity is being added where necessary. On the supply chain front, we're facing challenges, but so far we've managed to avoid major supply disruptions to our plants. Electronic components are impacted with constraints due to the mandatory shutdowns in different countries. Medical customers are prioritized by manufacturers. Other industries that are deemed critical to security also have special priority or waivers towards mandatory shutdowns. We can see that the demand outlook has changed compared to expectations coming into this year. Growth is stronger within Medical Devices, warehouse automation, and defense communication. Growth is weaker to flat for products where demand is more directly driven by the end consumer.
Now let's take a look at the financials this quarter, slide four, and go ahead, Cathrin, please.
Thanks, Peter. Now for the financials. Slide five, please. Very strong growth in Defense/Aerospace. The quarter ended up at 878 million NOK and an increase of 65 million NOK and 8%. The underlying growth is 2.6% or 3%. In all, so far this year, the sectors have been developing in line with what we expected coming out of Q4 before the corona pandemic. For the sectors offshore marine and energy telecom, we see substantial reductions. For offshore marine, the effect in Q1 is project timing related. For energy telecom, it's mainly related to the disengaged customer, but also related to weaker telecom in Q1. Medical Devices and industry growth is stable at 10%-15% in Q1. Industry is slower, which is due to demand effects noticed already last year. Very strong growth in Defense/Aerospace, a large amount of projects, and high activity.
In addition, the acquisition of the unit in the U.S. was made 15 February, and thus only 50% of the quarter revenue was included in Q1 last year. Looking at the sites, we have chosen to group the sites differently this year. Sweden and Norway unchanged. Lithuania and Poland shown together as CEE. U.S. as before, and now China is shown on its own. Norway shows strong growth with 14.6% and ending at 240 million NOK. Record for a Q1 for them. Sweden has a reduction of 13%, mainly due to the disengaged customer, but they have been able to compensate around half of that reduction with other customers, many of them new in different sectors. CEE in total show slower growth than anticipated last year, based on weaker demand in part of the industry and telecom sectors. U.S. again, not all revenue was included in Q1 last year.
We also expect demand to strengthen in the U.S. once we're back in the refurbished facility in Q2. For China, they bounced back in an amazing way and came in on plan although they have been closed and produced with reduced capacity for part of the period. Slide six, please. For Q1, this is a record EBIT for Kitron, but it's also according to our projected margins, which is gratifying. We would also like to say that there are no material effects on EBIT from currency.
I have to start out with that although the NOK has weakened towards almost all other currencies, we do not see the same type of effects in all countries. To explain, in the local accounts, local revaluation of the balance sheet and differences in currencies between paid received currency and registered currency is a total loss in EBIT of NOK 3.7 million, compared to a similar loss of NOK 2.2 million last year, i.e., an increased loss of NOK 1.5 million. In the group accounts, the foreign exchange effects in consolidation have a positive effect on EBIT with around NOK 3 million for this year, and the last year the effect was small, so let's round it to zero. Thus, for the EBIT for the quarter, a net negative of NOK 0.7, and last year, a net negative with minus NOK 2.2, neither material on the P&L.
The effects are not larger, as we try to use a natural hedge and balance each of the site in the balance sheet. We also aim to sell in the foreign currencies the countries buy materials in and have contract clauses if there are large negative and positive currency price effects, and adjust for those. Continuing on the P&L and going further down, there is also a net non-cash positive agio of NOK 2.4 million in the finance net compared to zero last year. In addition, I have to comment that the tax rate has increased from 17% last year to around 25% now, which is in line with what would be expected going forward. The increase is due to the tax mix, but also one unit in China going from low to high tax in 2020. Slide seven, please. Q1 EBIT by country.
In all, a strong quarter, all above 6% apart from the U.S., which is, I have to say, very good. Norway grows from 4.5% - 7.3%, a significant improvement in margin, but also growth in revenue, increasing profits from NOK 9.4 million -NOK 17.5 million. I think the best result for our Norwegian site for over 10 years. Sweden retains their margins of 6.3%-6.4%, although a reduction in revenue of 15% from last year. CEE is affected by demand in the industry and telecom, where growth is weaker to flat for products where demand is directly driven by end consumer. Although revenue is growing, it is currently not growing enough to be at the strategic profitability level with the added cost of the additional facility in Poland. With Poland at 3.9% and Lithuania at 7.1% EBIT margin, all things considered, it's satisfactory.
U.S. struggles slightly with foremost the old Kitron Inc. and some old contracts with low margins, which are being worked out. China has outstanding performance considering the limitations from the coronavirus pandemic. Rather impressive, I have to say. Slide eight, please. Working capital affected by currency. Working capital ended up at above 1 billion at NOK 1,031 million, a growth of 9%. However, adjusting for foreign exchange effects in consolidation, it's actually a reduction of 2% compared to the same period last year. The capital efficiency is based on three months rolling averages, and the currency therefore have less effect on the capital efficiency KPIs in general. However, we are carrying more inventory. The increase mostly in WIP and finished goods represented as contract assets in the balance sheet.
The increase here is due to demand being moved around in the short term, a higher degree of demand from products with longer production lead times, such as defense, where the products are more layers, they're more complex, and they have longer test times. That said, part of that increase is covered by advances from customers. Trade payables are increasing as a result of us buying more components than last year, and that from preferred vendors with longer payment terms. Trade receivables are in line with revenue. We see no more overdues than at last quarter-end, and those that were overdue has cleared a few days after the quarter closed. There's a positive cash flow of NOK 1.2 million in the quarter compared to positive NOK 25.4 million last year.
This is the result of good profits and a reduced balance sheet, proving that much of the balance sheet growth is currency and not cash related. Net interest-bearing debt over EBITDA is improved from 2.9 last year to 2.5 this year. I would say in all the capital situation in Kitron is satisfactory so far. Slide nine, please. Over to you, Peter.
Thank you, Cathrin. In general, we're seeing many opportunities in the market. Before we take a look at the order backlog, let me talk about our pipeline. In total, our pipeline amounted to just over NOK 2 billion in the quarter end. These represent annual values of quotes to customers waiting for a decision. Mostly, we focus on Medical Devices, advanced communication solutions or power mobility or infrastructure. These are opportunities we target to become part of our order backlog over the next 6-18 months. That being said, let's take a closer look at the Q1 order backlog on slide 10, please. It's important to remember our definition of order backlog. It does not include all future demand. Our definition is all firm orders and first four months of customer forecast. Forecast exists beyond four months, we do not include it in backlog.
Our record strong order backlog ended at close to NOK 2.1 billion, compared to NOK 1.5 billion last year. Just over NOK 1.8 billion of the backlog represents demand in 2020. The remainder is firm orders for 2021. The order backlog increase is particularly strong in the Defense, Aerospace, Energy, Telecom, and Medical Devices market sectors. The increased order backlog in Medical Devices is related to the coronavirus pandemic. Let's talk about the outlook for the rest of 2020. Slide 11, please. Before getting into the details of the outlook, I'd like to comment on the demand for 2020. Q1 has come in very much according to plans. However, for the rest of the year, we can see that the demand outlook has changed compared to the expectations coming into this year. One of the main drivers of this change is the coronavirus pandemic.
Growth is stronger within medical devices, particularly cardio and pulmonary devices. Warehouse automation is growing because of the increased pressure from online shopping. Defense communication shows a strong growth from several large customers. Growth is weaker to flat for products where the demand is more directly driven by the end consumer. I am impressed with the remarkable speed that the employees of Kitron have been able to shift focus, priorities, and plans to effectively deliver a different 2020 than what we had planned just a few months ago. Much hard work. I'll take this opportunity to say thank you. Let's move on to slide 12 and our 2020 outlook. Our outlook for 2020 remains unchanged. The degree of uncertainty has increased, but overall, we expect new opportunities to balance out more challenging market sectors.
For 2020, we expect revenue to grow and come in between NOK 3.3 billion and NOK 3.7 billion. Our EBIT margin is expected to be between 6.4% and 7%. Again, growth is primarily driven by the Defense/Aerospace sectors, Medical Devices sectors. Profitability this year is mainly contributed by strong growth on profits in Norway, which finally, after many years now of working, is starting to hit and exceed targets. Really happy with that. Very strong profitability in China, as Cathrin mentioned. Happy with the work done by the staff there to very quickly come back online and really impress us with what they've done. A big shout-out to those guys. The U.S. is also improving margins. Finally, in closing, let me summarize the key takeaways this quarter. Slide 13, please. As the quarter goes, this one is a record in many ways.
The five points you should make a note of are strong growth in order backlog, record Q1 revenue, increased margins, strong cash flow, and outlook maintained. This concludes the presentation portion of this webcast. We'll now move on to the Q&A session, and I'll ask Katrin Schön, I think. What's going on?
Thanks, Peter. We just got one question here, and that is how do you see offshore development for remainder of 2020?
Okay. I don't have the exact number in my head, but we see some mixed signals. Some of the seismic products are moving into next year. We still have orders for them, but it's moved really out of both Q1 and Q2, and now pushed into, I believe, Q2 of next year. Other products and other customers are very much stable, and we're continuing them. From a top-line perspective, it'll probably be close to where we landed last year. Unless you have something else to say, Cathrin.
I will say lower than that. Basically, with the project-related business in the seismic, that's pushed forward, for sure. The other subsea activities that we have with control units, et cetera, that has a more of an even demand so far. I would say lower than last year. Again, we don't know exactly at this point in time.
Okay.
Thank you. For now, we have no more questions, so we can wait a little bit to see if anyone have more questions.
We'll give people 30 seconds.
Okay. Mm-hmm.
Okay. I don't see any additional questions. I'd like to thank everybody for tuning in and listening to us and being part of our first quarter report. We're very happy with the results we presented. We look forward to seeing you all again at our Q2 report. Thank you so much. Have a great day.