Welcome to the Indutrade Q3 presentation for 2023. During the questions and answer session, participants are able to ask questions by dialing star five on their telephone keypad. Now, I will hand the conference over to CEO Bo Annvik and CFO Patrik Johnson. Please go ahead.
Welcome, and good morning on our behalf as well. We are happy about the quarter three report, and would like to start with some overall highlights, as we usually do. Continued high demand, order intake up 11% in total, of which -2% organically, and the strongest order development in MedTech and pharmaceuticals, but also water and wastewater, and a bit weaker demand in infrastructure, construction, and general engineering. Strong sales with a growth of 17%, of which 3% was organic. We had a continued high EBITA margin at 15.2%, and a new all-time high operational cash flow, and inventories continue to decrease sequentially. We had one acquisition completed in quarter three and two so far in quarter four, and the inflow of interesting companies to acquire remains good.
If we then turn to order intake a bit more specifically, continued high demand, as I said, against the challenging references, and 11% in total, whereof -2% organic, +7% from acquisitions, and +6% from currency. We see variation between companies, segments, and countries, and almost half of the companies grew in the quarter order intake-wise. As you probably know, it was 1 day, 1 working day less this quarter compared to a year ago. Book-to-bill below one, mainly, I would say, due to seasonality and increased invoicing pace, but also an indication of slightly lower demand in general. We see destocking at some end customers and in the value chain, which has some dampened effect on the order development, but difficult to assess the overall impact.
To mention some segments which were sort of stronger this quarter, I would say that MedTech and Pharma stood out positively, and also water and wastewater. Just to give you a flavor of those companies and products, I would say that we have a leading position in terms of insulin pumps and dosing equipment in the Nordic markets. We have several companies working with flow-related products like pumps and valves for pharmaceutical production. There is also several companies working with wastewater investments in different cities around Europe. So yeah, those segments stood out. I would say also the process industry and the energy segments were stable in some geographies, increasing and maybe in some slightly decreasing. So overall, aggregated as a stable situation for us.
Infrastructure and construction and general engineering was the weakest this quarter. Again, here, there are some engineering companies which are doing well, and there are some who have more of a difficult situation, maybe more linked a bit to Germany and the U.K. If we speak about construction, I would say that our exposure to small house buildings are very low. So our construction business is more linked to commercial houses and residential large houses in cities, but perhaps the infrastructure business is considerably larger than the construction part, I would say. If we look at business areas, Fluids and Mechanical Solutions and Industrial Components had a very good development, and again, it was to some extent driven by MedTech customers.
We also have a niche segment linked to the automotive aftermarket, which also has been doing well. In terms of the weakest development, I would say that business area Measurement & Sensor Technology, DACH, and U.K. stood out. U.K., I think, is a little bit more linked to the country and market as such. DACH had difficult comparables, and business area Measurement & Sensor Technology, they have some of their business related to an end market which is retail-oriented in the U.S., which this quarter has been a bit weaker. If we then turn to net sales, I would say that it's a continued good sales growth. In total, +17%, whereof +3% organic, 7% from acquisitions, and 7% currency related.
Good to sort of underline that the rolling twelve months sales trend now is slightly more than SEK 31 billion, which is a good level, obviously, for Indutrade. And six out of the eight business areas grew organically in the quarter. We should also say that supply chains are now more and more normalized, and most companies have no significant issues linked to that anymore. If we then look at sales in a geographic perspective, you see the slide with the plus and minus signs on. And strong here is Norway and also Denmark, and both those countries had good MedTech growth in the quarter. In Norway, we also saw good demand from the energy sector. You also see that Finland and Germany have some minus signs and weak demand, unfortunately, in several companies there.
As a segment, infrastructure and construction and general engineering stood out. In Germany, we also had, I would say, more challenging references in the MedTech and pharma sector. Finland is mostly built up of a lot of base industry, so they are usually lower early in the cycle, but also will increase earlier than other markets. That's more of a general situation in Finland right now. U.K., Ireland, they are mixed together on the slide here, but actually two separate situation.
I would say that the U.K. is declining and have more of a difficult demand situation, but Ireland is, on the other hand, more positive and still larger greenfield buildups in the country in different segments and also quite a lot of CapEx investments in several areas in Ireland. If we then take Holland and Belgium, we saw strong sales development in Belgium, and that's predominantly mostly export business from our Dutch companies. Switzerland, Austria, declining mostly because of challenging references, as I said before, and then we had very good sales, I would say, to the Swiss pharma and chemical industries. Last, Asia and North America impacted a bit by more volatile export project business.
This quarter, good project sales to the energy and engineering customer segments in North America, and tough references from last year in Asia, where we had good energy project sales there. If we look at the organic sales trend over time here, it's comforting to see that we had organic sales growth now for 12 consecutive quarters, and again, now driven by improved supply chains and good order backlog to sort of build upon in the quarter. A majority of the companies continued to show good growth in the quarter, and six out of eight business areas did that as well. Rolling five-year average organic growth now on 6%, which is highly prioritized, as you know from us.
This is, of course, slightly impacted by high inflation in the last year, but still a good number, I would say. The order backlog is now, after the quarter, basically normalized, with approximately two-three months of annual sales in the backlog on average. EBITDA continued, I would say, solid high profitability in absolute terms, close to SEK 1.2 billion, and a growth of 15%, 2% organic, 6% from acquisitions, and 7% from currency. The EBITDA margin was 15.2%. Last year, we actually had positive one-offs contributing with 0.2%. So if we sort of take that away, we were basically exactly at the same level as last year, including these one-offs. So comforting, stable, high EBITDA margin level.
If we then turn to the business areas and start with the overall sales situation, as I've said, organic sales growth in six out of eight areas and also in a majority of our around 200 companies. Benelux, strong development in, for example, valves for power generation, where we have a larger company, but tough references in some companies with the customers in the MedTech and pharma dampens the growth in that business area. DACH, strong sales last year, as I said earlier, to the Swiss pharma industry and some chemical industries. Finland, weaker development in most companies, again, based industry fairly early in the cycle. Flow, several customer segments contributes, for instance, MedTech, Pharma, where we provide production equipment like valves and pumps and instruments to measure flow.
We have some niche-oriented companies in the marine segment, which are doing really well. Process industry in general and also the energy sector. So quite broad-based in a segment perspective from Flow. Fluids and Mechanical Solutions, primarily driven by MedTech and Pharma this quarter, and also the automotive aftermarket, where we have a few companies. Industrial Components really stands out in terms of a MedTech perspective, not only from one company, several companies, but that's the area standing out. And Measurement and Sensor Technology, sales growth in majority of the companies with strong development in, for instance, companies with customers in the marine, engineering, and HVAC segments. Last, U.K., good contribution from energy, aerospace, and defense, but dampened primarily by the marine segment, where we have a larger company in the U.K. business area.
But I would say also a bit in general, a more difficult geography to deal with currently. If we then turn to profitability and EBITA margin by business area, improved situation in four areas out of eight: DACH, Flow Technology, Fluids and Mechanical Solutions, and Industrial Components. And largest improvement in Fluids and Mechanical Solutions, again, driven by MedTech and automotive aftermarket. In general, I would say that all our companies have done a great job in terms of price management, and as you can see in the report, we are having improving gross margins, which we are very happy about. However, we see higher expense levels. There has been step-by-step higher activity levels in companies, so this have a little bit dampening effect on the margin development.
The largest decline is in BA Finland, due to top line decline, and also somewhat higher expense levels. But I say, I would say that Finland, with a level of 16.3%, is still a very good level. Continued dampened margin in the U.K. There, we have slightly larger exposure to infrastructure and construction as a business area, and also a slightly larger cost inflation in general in the U.K. than the other European countries we operate in, and also a bit higher energy prices, so as I've said before, a little bit more difficult situation to deal with. The EBITA margin in the Benelux also falling behind slightly. The main reason is a weak development in a couple of larger companies with customers in infrastructure and construction, and also tough references in the MedTech and pharma sector.
If we then turn to acquisitions, we were able to complete one acquisition in quarter three, a Norwegian technical trading company by the name Noby. They offer premium security products and systems and fire alarm systems on the Norwegian B2B market. And also now in quarter four, we have been able to acquire two companies, Powerpoint Engineering in Ireland and also TSE Troller in Switzerland. Powerpoint Engineering is a technical trading company focusing on electrical safety and test equipment for use in high and medium voltage applications, basically to protect operators from electrical hazards. And as I said before, we're very optimistic about the market outlook for that sort of segment and this company, a lot of investments also in the grid in Ireland. TSE Troller, a very niche-oriented company.
They develop, manufacture, and distribute high-quality coating dies, quite large dies made of stainless steel, for really high precision coating layers in various industries. For example, they use these coating dies when they produce batteries for automotive applications. Our ambition since a while now is to gradually increase the number of acquisitions per year. However, given the increased market uncertainty we have seen the last quarters, we have been a bit more cautious this year and prolonged some of the acquisition processes. The competition has somewhat decreased, and our pipeline and inflow of interesting prospects is still strong, and we have a number of projects in different phases. All in all, quite optimistic about the acquisition situation. If we then look at the performance from our acquisitions, we have the view that we would...
Argue that you should follow acquisitions over a longer time period because they can basically be done in chunks. We don't particularly manage and drive acquisitions on a quarterly basis or monthly basis or anything like that. When they are ready, they are ready, and then we launch them and present them. And our goal is still firm to make two-three acquisitions per business area per year, and last year, we finalized 16 acquisitions. The three-year average is currently at 15. And if we look at the financial effects or those bridge effects from acquisitions, the last 12 months, we can say that the main reason for the slightly weaker development the last quarter is sales decline and weak result in one of the bigger acquisitions with exposure to infrastructure and construction. So that stands out a bit.
Otherwise, a clear majority of the acquisitions are actually accretive and having good performance. By that, I turn the word over to Patrik to comment more on the financials.
Thanks, Bo. So let's dive into the financials a little bit more. Total growth for orders and sales was 11% and 17%, respectively, in the quarter, and accumulated, we are at 12% and 21% up. Orders eight percent lower than sales in the quarter, partly because of seasonality, I would say. Orders are normally in our many of our companies stronger in the beginning of the year. Customers place orders during the spring for summer shutdowns, and partly also because of increasing sales pace, and of course also a slight indication of a lower demand situation. Continued good price work from our companies resulted in an improved gross margin, 34.8 versus 34.2 last year. Year to date, we're basically on par with last year.
EBITDA grew with 15% in the quarter and 20% year to date. The EBITDA margin was then 15.2 versus 15.4 last year, so slight, slight decline, but, as Bo already said, last year, we had, a few positive, positive one-offs impacting, primarily related to earn out, earn outs, and that corresponded to plus, oh point 2 percentage points then. So the underlying EBITDA margin is therefore in line with each other between the years. Year to date, the EBITDA margin is, at 15.1 versus 15.2 last year. Going further down in the P&L, the higher interest rates and also the higher debt level compared to, a year ago continued to impact the finance net.
So for the quarter, it was now SEK 134, and SEK 354 then year to date. Tax cost also increased then with 21% in the quarter, and that's slightly higher than profit. The main drivers are an increased tax rate in the U.K., and also last year, I talked about the one-offs, and some of that then are non-taxable, which meant that last year's tax rate was a bit pushed down. And then EPS declined slightly in the quarter, but it's up 8% than year to date, and I will elaborate on that a little bit more on one of the next slides.
Return on capital employed continue, I would say, on a good level, 21% above our target, but slightly lower than last year, mainly driven by increased working capital and the high acquisition pace that we've had than the last year. Operational cash flow, all-time high, above SEK 1.2 billion. Good performance, driven mostly by a more favorable working capital development than last year. And then lastly, net debt EBITA declined sequentially from Q2 down to 1.7 versus than compared to last year when it was 1.6. Okay, so moving on and looking a little bit more in detail on cash flow. And as I said, record operational cash flow for a quarter and at slightly above SEK 1.2 billion.
The improvement versus last year was mainly related to, supported, of course, by a good profit level, but pushed up then by favorable working capital development. Last year, we had a relatively high inventory build-up, but this year, total working capital is declining during the quarter. We saw a continued inventory reduction in the quarter, mainly driven by the good sales we have, along with the more, the better supply chains, as Bo described. The inventory levels are, however, still high, we think, and we are continuing to work with that, and we expect to see further inventory reductions in the coming quarters. Moving on to earnings per share.
As I said, then that decline in the quarter with 2% from 1.9 SEK to 1.87 SEK. The increase in EBITDA was offset then by the increased finance net and higher tax costs that I mentioned. Also, impacting is higher amortization levels, driven by the acquisition pace last year, I would say. If you look at the earnings per share on a more long-term perspective, the last three and five years average, they were on 20% and 19%, respectively, per year growth. Then lastly, looking at the debt situation, the interest-bearing net debt decreased sequentially from quarter two, with more than SEK 750 million down to SEK 9.4 billion.
Mostly related to the strong cash flow that I talked about, and also slightly fewer acquisitions during this year so far. The increase versus last year, that's mainly driven by the acquisition pace end of last year and beginning of this, which was very high, and the combination also with the dampened cash flow that we saw last year. Net debt ratios declined slightly, sequentially, and are not high from an historical perspective, I would say. Net debt equity now on 66%, and net debt EBITDA, as I said, 1.7. And if you exclude earn-outs, it's at 1.5. To summarize, I think the financial position is strong, relatively stable, low debt ratios, and a balanced debt maturity profile, with only a very small share short-term debt.
On top of that, or in addition to that, we also have sufficient, guaranteed, unused credit facilities as backup. So by that, I say thank you, and leave back to Bo.
Good, Patrik. Since we are experiencing a somewhat more difficult business climate in general, I think it's appropriate to just mention a few words about our group structure. One of our key characteristics is obviously the diversified portfolio of around 200 companies. And looking back, this has obviously proven to be a strength. We have performed relatively well compared to many larger integrated industrial companies in previous economic downturns. We are not dependent on any single end segment, any single product area, or geographic market. Medical technology and pharmaceuticals, which have grown significantly for us during the last year, is a strong sort of strong factor in a more demanding business situation.
Also, we have a strong exposure in many companies to segments with structural growth driven by the green transition, among other things. So already several years ago, we were more resilient, I would say, and I think we have increased that resilience in the last years by growing the company in certain segments which are more stable. We also, as most of you know, have a bit more than 50% of our revenues linked to technical trading companies, which in general are capital and people light. The group in total are built up by smaller companies, and they are per definition, I would say, more agile, flexible than a large integrated industrial company.
So all in all, with our decentralized model and local decision-making close to the customers, we have a well-diversified structure and are able to manage market fluctuations in a relatively better way than these larger industrials, which could be good to know. If we then summarize the key takeaways, as we have said, continued high demand situation, although somewhat dampened. The uncertainty around the general state of the economy remains for the coming quarters. Several of our companies are well-positioned in structurally growing market areas with good opportunities for continued growth. Solid EBITA margin and all-time high operational cash flow. Nine acquisitions so far in 2023, with combined annual sales of approximately SEK 1.2 billion, and several ongoing projects in different phases. And all in all, a strong platform for continued, sustainable, profitable growth. So by that, we end the formal presentation.
If you wish to ask a question, please dial star five on your telephone keypad to enter the queue. If you wish to withdraw your question, please dial star five again on your telephone keypad. As a reminder, if you wish to ask a question, please dial star five on your telephone keypad. The next question comes from Robert Redin from Carnegie. Please go ahead.
Yeah, hi. So thanks for the presentation. I just had a question on acquisitions. I mean, you show that slide with the three-year average pace of acquisitions and the pace last year, and you have that target of two to three acquisitions per business area. But I guess you're still a little bit below that year to date, and I've heard you say that you want to, you know, prolong processes to see where whether the demand picture ends up and so on. Do you now feel that you have more visibility on where demand is ending up? Could you be accelerating your pace of M&A going forward now?
Or, is the picture still the same, that you want to take your time in those M&A processes?
No, I think all in all, a slightly better position and situation now than in the middle of the spring earlier this year. We have a better perspective in terms of market developments, and we have also been able to demonstrate and deliver high operational cash flow. So, I would say that we are a little bit more in a better comfort zone now than we were six months ago. So we haven't stopped projects, but we have prolonged some projects and the pipeline is good. So a somewhat better situation now, Robert, than six months ago.
All right. That sounds, that sounds good. So you're more, I call it, confident. And what about the inflow of potential targets? Is that going up now that times are tougher, or is there still a good inflow, supply side quality?
It's actually a good inflow. Maybe the quality of the inflow has been somewhat weaker, but compared to earlier weaker cycles, I would say that the inflow is much better now than what it has been earlier, but maybe slightly weaker quality. But still enough good inflow in order for us to have a good acquisition pace going forward.
All right. Sounds good. Thank you so much.
Thank you.