Welcome to the Inwido Q3 2024 report presentation. For the first part of the presentation, participants will be in listen-only mode. During the questions and answers session, participants are able to ask questions by dialing pound key five on their telephone keypad. If you are listening to the presentation via webcast, you can ask written questions using the form below. Now, I will hand the conference over to speakers, CEO Fredrik Meuller and CFO Peter Welin. Please go ahead.
Thank you. Good morning, everyone, and welcome to this webcast and telephone conference covering Inwido's third quarter and nine-month year-to-date performance in 2024. My name is Fredrik Meuller, President and CEO of Inwido, and joining me on today's call here in Stockholm is Peter Welin, our Group CFO. You know the drill by now. The structure of this call is that I will start with a run-through of where our group is finding itself right now, our latest achievements, and financials, and then Peter will provide an educational deep dive into the financials at both group and business area level. So pay close attention to this, and as usual, this presentation material is already available on Inwido's website. At Inwido, we are on a mission, an exciting growth journey towards becoming a SEK 20 billion turnover company by year 2030.
Through our thirty-five business units and across twelve countries, our employees are making good progress on that journey, and it will be further boosted by the EU's green transition, as well as by synergistic acquisitions. We are de facto Europe's leading window group, with particular strongholds in the Nordics and in the U.K. This year, we celebrate twenty years as a group, ten years as publicly listed on Nasdaq Stockholm, and Elitfönster are marking their centenary. So we're obviously in it for the long haul. Importantly, we are not just producing high-quality windows and doors, we also improve people's quality of life through our energy efficient and aesthetically appealing solutions. Now, let's look at the quarter that just passed, and I'm proud and pleased to announce that our profitable growth has continued also across July through September.
Both our order intake and order backlog continued to grow for the second consecutive quarter. Despite our invoicing being slightly down quarter-on-quarter, Inwido's operating EBITA margin edged higher than Q3 last year as a result of increasing efficiencies originating from our investments made in people and in operations. Importantly, our endless efforts to cater for the well-being of our coworkers are continuing to bear fruit in the form of further improved figures within both health and safety and sick leave. While leading market indicators are gradually becoming more positive, primarily within consumer-related segments in Denmark and Sweden, we, as a group, are not yet out of the doldrums. In fact, several entities in Finland, England, and Norway still face a tough market, substantial competition, and related price pressure.
In light of this, however, Inwido's business units handle the situation in an impressive fashion, delivering on their customer promises and being perceived as a flight to safety when some peers struggle, thereby gaining market share. On this slide, we summarize our key financials for Q3 this year relative to Q3 2023. Order intake grew by 3%, also organically, and order backlog reached an impressive 2.6 billion SEK, up by 9%. Net sales, in turn, declined by 3% quarter-on-quarter. Organically, the decline was 1%, reflecting the harsher conditions witnessed this year. In spite of this, our operating EBITA reached 304 million SEK, a tiny 4 million SEK down versus last year, but equaling a margin of 13.4%, up from 13.2% in 2023.
All business areas fared better, with the exception of Eastern Europe. Net debt in relation to operating EBITDA went up from 1.1 times last year to 1.2 times now, or 0.9, if not applying IFRS 16 accounting. Accordingly, safely within our set target and still offering ample room for, for example, acquisitions. All of our business areas performed well this quarter, particularly considering their different operating contexts. Scandinavia keeps delivering strong profit margins, leveraging its leading positions and enjoying a favorable mix. Within consumer, i.e., renovation, Denmark is rather stable and Sweden is showing signs of recovery, but Norway remains soft and so does new build across all three countries. Eastern Europe, in turn, bucked its sharp demand drop in new build by enhancing the efficiency of its operations. Both order intake and backlog grew nicely compared to Q3 last year.
Business area e-Commerce goes from strength to strength, now growing both top and bottom line and taking some strategically important marketing measures that will pay dividends further down the line. Last but not least, Western Europe's strong results now came from a broader base than last quarter, where all larger entities performed well alongside Sidey and Carlson, while still experiencing a tough market climate. If we stay with Western Europe, I'm very pleased to announce that Jonna Opitz has now been made permanent in her EVP role for this BA, in addition to her responsibility as Head of Communications. So well done, Jonna. Big congrats. Other examples of matters worth celebrating this quarter, of course, include our exciting acquisition of Finland-based sun protection supplier, Artic Kaihdin, as well as our continued investments in sustainability.
Listen to this: in our Sokółka factory in Poland, our new paint line will from now on save us some twenty-three thousand liters of paint on an annual basis. How about that in terms of making a concrete, positive difference to the climate? Time flies when you're having fun, and since we are already in the month of October, and since lots of achievements have been recorded across Inwido during the first nine months of this year, it is worth taking stock of what some of those strategic milestones are. The first addition of myself and Mikael Jonson to our group, for our strong group management team and board of directors respectively, is, of course, highly pleasing. He says humbly.
The fact that we have developed and launched innovative and sustainable new products, like the CO2 Window in Finland recently, or Elitfönster's energy efficient 100 series, or Diplomat's collaboration with Yale on smart doors, is so important for our organic growth and for solidifying our leading market position. The Artic Kaihdin acquisition also sent a strong signal that we are back on the M&A track. And while others have stepped on the brakes, we have done the opposite, investing further into operations and sustainability to come out from the cycle downturn even stronger. Getting our climate goals validated by the SBTi is yet another proof of us doing the right things. At the end of the day, though, I'm most impressed by how we handled the sharp drop in demand in such an agile fashion, without destroying either our short-term capacity or our long-term competitiveness.
Those of you following us closely have, of course, registered that Inwido's performance has improved stepwise so far this year. Q1 was still severely hampered by low market demand, but in Q2, we started growing our order intake again, and even more importantly, that pattern has continued also now in Q3, despite sentiment out there not being back where it should be. Do note that our profitability has remained rather high throughout all three quarters. I'm very pleased about that. In short, our nine-month figures comprise an organic net sales decline of 10% and an operating EBITDA margin of 10.2%, down from 11.0% in the same period last year.
Return on operating capital has been 13.1%, compared to 16.2% in 2023, and the negative delta in earnings per share before dilution from 8.52 SEK last year to 6.12 SEK is largely related to items affecting comparability and to positive currency effects in last year's financial net, as per our Q2 communication. Now, before I hand over to Peter, let me just briefly share with you a highly positive personal Inwido experience. This summer, I replaced old windows and doors with new Elitfönster ones at my house on the island of Öland in the Baltic Sea. Yes, I'm biased, and yes, I bought them prior to joining the company, and yes, it's a big investment, but still, the seamless process in which our just-in-time delivery and top-notch quality is worth a lot in this business.
Above all, the fantastic impact this type of renovation has on your quality of life is just mind-boggling. It goes far beyond, quote-unquote, just windows and doors. Peter, over to you. Please go ahead.
Thank you so much, Fredrik. And we start with the income statement. On this page, we can see the income statement for Q3 to the left, this year as well as last year. In the middle, we can see the development, January to September, and then further to the right, we can see the latest 12 months as well as full year last year. Starting with the quarter, sales was down by 3%. The organic sales decline is 1% compared to last year. The gross margin has been improved from 26.7 to 27.1, due to mix, but also positive development when it comes to pricing as well as sourcing, as well as improved efficiency.
The operating EBITDA, as well as the operating EBITA, has declined by 1% compared to last year, and the operating EBITA margin has improved from 13.2% to 13.4%. Looking further down the income statements, we can see that profit after tax, as well as earnings per share, was -1% compared to last year. Looking development, January to September, sales have declined by 4%. Organically, sales have declined by 10%, equal to SEK 728 million lower sales compared to last year. The gross margin is likely down compared to last year, due to the performance in Q1 and beginning of Q2. Operating EBITDA is down by 7% compared to last year, and operating EBITDA is down by 11% compared to last year.
Operating EBITDA margin has declined from 11% to 10.2%. The main reason is the lower sales, the organic sales of SEK 728 million, mainly from Q1. Further down the income statements, we can see that profit after tax is 25% lower than last year, and the earnings per share is 28% below last year. That gives us a rolling, a related 12-month development of sales of SEK 8.7 billion and operating EBITDA of SEK 947 million, equal to 10.9% units, and an earnings per share of SEK 9.32 per share. On this page, we are describing how we calculate the organic growth. We do it somewhat a little bit differently compared to some other companies. What we do is that we recalculate last year.
If we start with Q3 in 2023, we had sales of SEK 2,339 million, and then we add on last year's sales, the acquisition, and this is mainly in Artic that we acquired in September. We add on SEK 8 million, because that was their sales last year in Q3 in September. Then we had a pro forma for Q3 of SEK 2,347 million, and then we recalculate the pro forma with the currency as of today, meaning sales declined by 2% or minus SEK 46 million. Then we compare to the sales development as of today, showing an organic sales decline of 1% or SEK 29 million.
This page is showing a waterfall, showing the sales development as well as the operating EBITA development for Q3, where we can see the different business areas and their performance. Starting with sales, we can see we have a negative sales development in Scandinavia of -SEK 46 million, as well as Eastern Europe of -SEK 87 million. Then we have a growth in e-commerce as well as Western Europe, and then group-wide and other is more or less the same as last year. Looking at the operating EBITA, it is from SEK 308 million to SEK 304 million. Scandinavia, we have a decline of SEK 2 million due to lower sales. Eastern Europe is also declined. There's SEK 20 million due to lower sales. We lost 15% of sales in Eastern Europe in the quarter.
Whereas in e-commerce, we have positive development on operating EBITA, plus SEK 2 million, and in Western Europe, we also positive development of SEK 60 million. And Western Europe is actually like for like in growth right now because we acquired Sidey Group beginning of Q3 last year, and so we have the same group this year as last year when we compare the groups. And then group-wide donations, others are exactly the same as last year, ending up on operating EBITA of SEK 304 million. So despite the negative development of Eastern Europe, we have been able to improve the margins, and the margin, the operating EBITA margin for the quarter was 13.4%. This page is showing sales as well as operating EBITA margin for Q3, for the period 2019 until 2024.
The margin this year, of 3.4%, is above the margin of last year, as well as above the margin of Q3 in 2022. It is, however, below the margins during the pandemic. We had a really strong margin in Q3 in 2020 as well as 2021. If we look at more historic perspective, the margin of this year is also above the pre-pandemic level. Looking at the cash flows, the cash flow from the operating activities was up 2% from SEK 330 million to SEK 335.7 million. Then Inwido is operating with negative working capital, and this, of course, is very positive, however, not when you are declining. Looking at the change in working capital, last year, we had a positive development of SEK 11.6 million.
This year, we have a slightly negative development of SEK 3.4 million. Inwido has also increased the CapEx level. The CapEx level or investments in activities, excluding change of financial assets and excluding acquisitions, is up 20% for Q3 compared to last year, meaning that cash flows before financial activities is slightly down by 8% when comparing to last year. The graph to the right is showing our CapEx level for the full year 2019 until the rolling twelve months now in September, and then also year to date for last year as well as this year. As you can see, we have an increasing CapEx level during 2023 as well as 2024. Prior to the pandemic, Inwido had a CapEx level of about 3%.
Then during the pandemic, the CapEx level decreased, and now we have to have a bit of catch up during the lower levels between 2020 and 2022, and thereby we have improved the CapEx level, and it's today on 4.3% rolling twelve months. But despite the higher CapEx level, we have been able to reduce our net debt. The net debt was reduced in Q3 comparing to Q2, and this is normal for the business. We have a large seasonality, and the seasonality has always a positive cash flow generation in Q3 as well as in Q4. So in normal business, the net debt is decreasing in Q3. This was not the case last year, but that was due to the acquisition of Sidey. Excluding Sidey, the net debt was also reduced in Q3 when compared to Q2.
Today, the net debt is more or less the same level as last year. And if we look at net debt versus EBITA, we can see we are today on 1.2 compared to 1.1 last year, including IFRS 16. And excluding IFRS 16, we are on 0.9 compared to 0.8 last year. And both those KPIs has been improved when comparing to Q2. So Inwido has a good headroom compared to financial targets of maximum 2.5. Another financial target of Inwido is return on operating capital. There, we have a target of 15%, and we are today on 13.1%. The development has stabilized compared to the peak in Q4 of 2022, and we have the same return operating capital in Q3 as we had in Q2.
When comparing to the peak in Q4 2024. The main reason why we have lower return on operating capital is, of course, the lower resource. EBITDA has decreased during this period, and at the same time, operating capital has increased due to acquisitions, also due to higher CapEx level, and also somewhat due to the working capital, because we have a negative working capital, and the working capital is then increasing. Looking at our working capital in percentage of sales, the operating working capital is quite stable. The main reason why we have lower return over capital is the lower volumes, and thereby the lower operating EBITDA. Talking about volumes, this page is showing the order intake as well as the order backlog.
To the left, the graph to the left, we can see the order intake for Q3 for the period 2019 until 2024, and to the right, we can see the order backlog end of September 2019 until 2024. The order intake this period is + 3% in total, and when we exclude acquisition, it's still + 3%, because acquisition has quite a small impact on order intake this year. It's very hard to see the small line. We can see the figure of SEK 5 million, and that is the impact from Artic in Q3. The order backlog is + 9%, and if we then exclude acquisitions also from the order backlog, it's + 8% when comparing to last year, and Artic has an order backlog of SEK 11 million, thereby the figure of 11 on top of the stable for 2024.
If you then look at the different business areas, start with Scandinavia. In Scandinavia, we have improved the margin, and we have increased the order backlog. Sales is down by 4% to SEK 1.014 billion, compared to SEK 1.06 billion last year. Operating EBITDA margin has been improved from 16%-16.5% in a quarter. The order intake is +2%, and the order backlog end of the quarter is +18% compared to last year. Eastern Europe is still struggling when it comes to sales. Sales is down by 15% compared to last year. However, we have improved the order intake on a weak market. The margin has improved in the quarter compared to the first half of 2024, and the operating EBITDA margin for Q3 is also above the level of 2021 to 2022.
In a story perspective, we are below last year, but we are above the level of 2021 and 2022. Sales minus 15% to SEK 473 million. The operating EBITDA margin declined from 12.7% to 10.8%, and the order intake is + 11%, and the order backlog end of the quarter is also + 11% compared to last year. E-commerce. In e-commerce, we have a higher order intake, and we have also improved the margins, and we have improved the margin despite increased marketing investments for future growth. Sales is + 7%, increase from SEK 267 million to SEK 286 million. The operating EBITDA margin has been improved from 7.5% to 7.7%. The order intake in a quarter is + 16%, and the order backlog end of the quarter is + 5% when comparing to September last year. Then we have Western Europe.
In Western Europe, we have a positive development for all larger business units, and the profitable growth continued in the third quarter. Sales is +11%, from SEK 456 to SEK 506. The operating EBITDA margin has been improved in the quarter from 11.4% to 13.5%. The order intake, however, is -8%, and in Western Europe, especially in Ireland and Scotland, we are working with quite large projects, so it depends on when we take these large projects. But nevertheless, the order intake is -8% compared to last year. The order backlog, however, is +4% compared to last year. I now hand over back to Fredrik.
Thank you very much, Peter. This slide adds flavor to where Inwido is finding itself strategically as a group right now, and above all, what the main building blocks are on our exciting growth journey towards 2030. We foresee a gradual increase in tailwind from external factors, starting already in 2025, where EU Green Deal is a big deal, and we are returned to a more normalized demand level in both renovation and new build, will make a substantial difference as well. On top of that, our own efforts within, for example, new product development coupled with synergistic acquisitions, will definitely be value-adding. Combined, this new volume shall flow through a more efficient structure, ensuring profit margins stay healthy. To recap then, in the third quarter, Inwido further proved that it can grow profitably, even though market conditions are far from optimal.
Order intake, order backlog, and operating EBITDA margin all improved for the second consecutive quarter. Our position has strengthened through gaining market share and the acquisition of Artic Kaihdin. Leading indicators are gradually becoming more positive, and EU Green Deal for energy efficiency is being worked on in all member states. Altogether, we remain enthusiastic about what lies ahead. And last but not least, we would like to make some noise about our upcoming events, so please make a note of these in your calendars already now, particularly our Capital Markets Day that will take place in Stockholm on the eleventh of December. As always, you can find a lot of useful information on our website and via our frequent posts on LinkedIn. And now, Peter and I would be delighted to answer any of the questions that you may have. Please.
If you wish to ask a question, please dial pound key five on your telephone keypad to enter the queue. If you wish to withdraw your question, please dial pound key six on your telephone keypad. The next question comes from Johnny Jin from SEB. Please go ahead.
Yes, good morning, Fredrik and Peter. Thank you for taking my question. A couple of questions from my side, starting with the gross margin. It looks like it's very strong in the quarter, and you mentioned some mix effects here, but you also mentioned some price pressure in other markets. So maybe can you break this down a little bit, and what drives the gross margin and how we think about the gross margin going forward? That's my first question. Thank you.
Hello, Johnny. We have a mixed, positive mixed development, meaning that we have a mixed development when it comes to our sales. We have a high degree of consumer sales compared to industry sales, and then we also have mixed development. Some of the most profitable business units have a higher growth compared to other business units. So there's a mixed development. When it comes to pricing, and when it comes to sourcing, we have been able to hold on the prices. We see some development when it comes to material prices. We see a bit more upgoing trend when it comes to some material prices. The material prices went down in 2023, but now at the beginning of this year. But then we see it had been stabilized, and we see more increasing material prices for the future.
Not a big increase, but some increases, and we've been able to keep our sales prices in general, I must say, then of course in some markets where the market has been more negative, where the competition has been a bit harder, there we see a little bit of price decreases, but in general we've been able to keep the sales prices, and then we've been working with our efficiency. We have been, during the last year, increased our CapEx level to improve the efficiency as well as the capacity for future growth, and we have been able to utilize some of this efficiency in the quarter, and that's a total mix impact of the growth margin.
I understand. That's very clear. And going into the segments a little bit here. In Eastern Europe, it looks like cost is down materially in the segment. So my question here is, do you see further room to reduce cost in Finland to, so to speak, help profitability? Or will it require more volumes and drive from the market here to drive margins and profitability from here?
Hi, Johnny, this is Fredrik. I think it's a relevant question. No, it's a difficult balancing act, and I think all else equal, we have done a really good job here in Finland, given the circumstances, and we see that some of our peers are really struggling. There was actually one competitor that went bust just the other week. Of course, we stay close to the situation. Our order intake picked up quite nicely in the quarter, so that gives us comfort for what comes ahead, particularly on the renovation side. But as you know from before, we don't want to go down too much in cost level, because that will hamper both competence and capacity.
I think we're rather pleased with where we are right now, and hopefully, we can actually turn it the other way around, rather soon.
Okay. And in Scandinavia, I know it's, it also looks that the margin is very strong and impressive in the quarter here. And we talked about the mix here, a bit with more consumer, but would you say that the backlog has similar profitability as in the quarter in Scandinavia, or how should we view the margin there going forward?
So once again, Johnny, we missed a little bit. What was the question?
The profitability in the backlog-
Scandinavia?
in Scandinavia. Yeah.
Looking at the profitability in Scandinavia, there is a little bit mixed development. We have Denmark going strong. They went strong also in the beginning of this year, so Denmark is still strong. In Sweden, we see more stabilizations when it comes to consumer market, where the industry market is still very challenging. Then Norway is also behind Sweden in that sense, so Norway is still a challenging market for us, both consumer sales as well as industry sales. We mostly have consumer sales in Norway, but still a challenging market for us, so we also have a positive mixed impact looking at the Q3 development when Denmark is going strong, which we have a higher margin in Denmark compared to Sweden and also in Norway.
Just to add to that, I think also we haven't seen all efficiency improvement projects come to fruition or come to an end yet, of course, either, primarily in Denmark and in Sweden, but less so also in Norway. So that will, of course, all else equal, add to the margin, add to profitability, particularly when we get more volume sometime in, you know, hopefully in 2025.
Okay. And building on that, the last thing you said there, Fredrik, given the solid margins that you can deliver now in this tough market, for the group here, would you say that you have created a more, even more cost-efficient platform from here that can push margins for the group even higher once volume return, and that you have created a new, higher, lowest level, so to speak?
Yeah, no, definitely I would agree to that. And again, we haven't seen all of that come to fruition yet, so there's more to come. But yes, I would say we're doing a great job here across all of our entities, really, given the circumstances. So that and that again we talked about it already in the Q2 report, where others have stepped on the brakes, we have really stepped up and stepped on the gas pedal, and I think it's a sign of strength that we can invest, but we de facto have invested. But it's not always about the money, it's also about project management of these rather large and substantial projects, and there, I think we've done a great job.
Yeah, it does give me a lot of comfort for what's to come.
Okay. And then, on M&A side, could you please give a comment here how the pipeline is developing, and if there is something in particular in terms of acquisitions that you're looking for? A nd yeah, that's my question.
Yeah, it is of course, as I mentioned several times, it is a core part of our, a core pillar of our strategy, since some time, and also going forward. Activity level within M&A started to pick up in May, I would say, in the spring, and has increased ever since, which is a sign of the industry itself getting back on its feet, but also a sign of Inwido being very much perceived as an attractive buyer and owner. I was happy to see us taking one deal to the finish line now in early September, in the form of Artic Kaihdin in Finland.
Not super large, but strategically quite important, and in a company that we know well, and they will add to broadening our offering in terms of some protection in this case. We have a solid both growth list and net list when we look at our pipeline and the funnel that we have. It's very difficult to say when the next transaction will happen, but I'm very comfortable with the team I have in-house and the work that we're doing. We're not stressed up about M&A. We have a high activity level, and it looks good, and it's more. Yeah, it could be a catch-up effect at some stage where you get a number of deals happening at the same time, fine, but at the moment, it looks rather good.
We are typically aiming both for new markets and for deals in existing markets, which is also, I think, a sign of strength. It would, of course, be nice with something where we get a little bit more bang for the buck. Particularly if we go into a new entry, into a new geographic market, then we would like something bigger to get a strong foothold already from day one.
Okay, thank you. And just one final one from my side. Can you please comment and say something about October, how that has started for you?
No, what, it's a relevant question, but I don't think we can do that, unfortunately, Johnny.
Okay. But would you say that the market is, so to speak, similar, and if you talk in broader terms?
No, no big material changes compared to development in Q3.
Okay, that was all for me. I go back to line. Thank you so much for taking my question.
Thank you.
Thank you, Johnny.
The next question comes from Albin Nordmark, from Nordea. Please go ahead.
Yes, hello, Fredrik and Peter, Albin from Nordea here. So, I think I can just continue on the last question there, regarding M&A. So, what geographic markets are the most interesting from here, if you're getting into a new one?
Yeah, we want to get further down into Central Europe, typically speaking, if we talk about new markets, and of course, the sentiment across these markets, we talk, you know, France, Germany, Austria, Switzerland, but also other parts of what we would refer to as Eastern Europe. The climate and sentiment varies quite a lot, but overall, we thankfully have solid cases, rather attractive cases, in basically all of these markets at the moment, on top of the ones that we have within jurisdictions that we are already present in. Let's not forget that it's a very fragmented market, and I think a good opportunity to try to buy the right ones, as well. So there are quite a few cases coming up and quite a few cases that we're working on.
The net list, I would say, is probably 15+ companies at the moment, and that's the net list.
All right. Thank you very much. But in the report, I think the most surprising, I think from my side, was the margin uplift in Western Europe, 200 basis points or so. So what does this exactly stem from? Yep.
We have a good development on the latest acquisitions in Scotland. There, we have improved the margins. But then we have also, in a very tough market in England, where the market is down, we have been able to gain market shares, and we also take some customers from those competitors who went into bankruptcy. And we have then also in total been able to improve efficiency on some of the larger businesses in England. So even though the market is challenging, we've been able to compensate that by taking new customers in, and we have then been able to improve efficiency and thereby improve the margins.
Are you taking cust, so the volume is the main driver here?
Volume and improved efficiency.
All right. Thank you for that. And Jan, just on the Finnish acquisition here two months ago, sun protection solution is somewhat a new area for you. How has the integration been going there, and should one expect more acquisitions of sun protection companies?
I think the integration is going well. We know this company fairly well from before. As we stated in the press release, roughly 15% of the business is actually already to Inwido since some time back. So in that sense, it ensures that we have a bit of a smooth integration here. So yeah, definitely potential for cross-selling across our Finnish operations, but maybe beyond the Finnish border as well. Yeah, I'm not saying that we specifically look into this character when we look at the additional investments or additional acquisitions further down the line, but it is an interesting one where we see an increased demand of this combo of sun protection and windows.
As the windows typically get larger in size, you have more light inflow, and together with some climate changes, of course, you need to protect your houses more from the sun than from the heat. So I think this is an interesting one.
Yeah, sure is. And lastly, you made some comment about some savings of twenty-three thousand liters of paint or something similar. So apart from the obvious climate reasons, how is the financial return on these kinds of investments?
Good, I would say. We have a very stringent process for discussing and reviewing and approving investments, but also very solid follow-up of the bigger ones, but I'm pleased to note that sustainability is one key topic item that we're looking for when we talk about the major investments. This particular example, I think is one good example out of very many that we perhaps should make even more noise about going forward, because there is a lot going on, and of course, twenty-three thousand liters of paint is a big deal, both financially and environmentally, and improves the workplace for our coworkers as well, so yeah, it is an important factor that we take into account when we look at bigger investments.
But can you say anything about the payback time?
Difficult to say, Albin. It's typically good payback time. I'd say three, four years perhaps is something that we're typically looking at.
All right. Thank you.
But in the current state of market, it's rather difficult to find a normalized volume level. That, of course, as you know, affects the payback time rather dramatically. So, yeah, it's a bit of a wet finger in the air at the moment. But the good news is, at the same time, that we're really in it for the long run, together with our board of directors, and we have very good discussions around this in both the group management team setting and in the board of directors setting.
All right. Understood. Thank you. That's all for me. Very helpful.
Thank you, Albin.
As a reminder, if you wish to ask a question, please dial pound key five on your telephone keypad. There are no more phone questions at this time, so I hand the conference back to the speakers for any written questions or closing comments.
Okay, thank you for that. We have received one question, and that is from XF Invest, and where they ask our definitions on the order intake and order backlog. They are saying that in, on page eight in our report, we're saying that the order intake is down by 8% for Western Europe, whereas the order backlog is + 4%, and they ask us to explain the difference between order intake and order backlog. The order intake, that means in the quarter, new orders in the quarter compared to new orders in the quarter last year, and that is down by 8%. The order backlog, or in Swedish, it's called order stock, is + 4%.
That means that the total amount of orders end of September, which has not been invoiced, compared to the total total number of orders, or not number, value of orders compared to last year per end of September. So the order intake, that it means new orders coming in. The order backlog, that means the total value of all orders that we have that has not been invoiced end of September compared to last end of September last year, and that was + 4%. We don't have any further questions, so we hereby close this meeting.
Yeah. Thank you very much, Peter, and thanks everyone for attending. That's it from Peter and myself. Take care out there. Goodbye.