Good morning, good morning everybody. Welcome to this Q1 report for Nilörngruppen. Time is flying, and it's already passing the first quarter 2024, and it's happening a lot in the world, and it's happening a lot in Nilörngruppen as well. So we will have here give an update of the numbers but also what's going on within the group. With me today is Maria Fogelström, our CFO in Nilörngruppen. She will help me with any difficult questions that I cannot work out. And also for your information, the intention: we will record this presentation, so we will share this later on the internet—sorry, in the internet—on our web page. And as usual, if any questions, you're welcome to add them in the Q&A here, and Maria will then later on read them and present them for us, and we will try to answer them here.
Good, so once again welcome, and I will share my screen here with you. Yeah, starting here as we used to do, starting with the financial performance. As I said, the Q1 2024 order income was up +5% in the quarter, and taking into consideration here is that the order income was quite strong in Q4. We had a +12% in Q4, and also the comparison number last year, the order intake in Q1 2023, was a +21%, so we have quite tough comparison numbers. So I think this order income is quite strong, actually, so even though it sounds only +5%, but I think it's—we are satisfied with that number here. Looking at the sales, +10% in the quarter, and looking at what happens in the quarter, a big impact on the Chinese New Year’s.
As you probably know, the Chinese New Year's appears in different months each year, and this year, the Chinese New Year's was in February. So looking at what happened in the quarter, January numbers was strong, February was a little bit weaker, and then March again was quite strong. Now what's happening in April here, we had Easter in March last year, this year, and in April last year. So a lot of calendar effects and so on, but overall I think it's a positive trend in the Q1. We also seen, as presented in the report, continued strong development in the luxury segment. We see that also in the luxury segment there are some hesitations.
Not that we see that from our order intake and sales, but in general terms, when listening to the client, they then don't see the same strong trend as in the previous quarters. I think that is natural, and I think for us we have won quite good ground here in the luxury segment, so we will continue with that. The outdoor segment, we see a recovery in the outdoor segment, but it's going slowly, and we, as we presented in the report, we think that the outdoor segment will be in full swing, up and running, in the Q3. Positively is that in general, talking about all brands and clients we have, it's more activity, more discussions, and more easy for our salespeople to get appointment with the brands, which is general positive. We can also say in general it's different in different markets.
Some markets is stronger, some markets is more hesitating. Not sure why in different countries when I say, yeah, different countries. So—and that probably depends on, what— the effect in the different markets like in Holland and so on. We feel that we are not that strong, but in other areas we are much stronger. Almost no currency effect this quarter. The Swedish krona has been a little bit stronger again, so, which is good, more stabilized, I think. Operating profit is up here to SEK 22.5 million and an operating margin of 9.3%. Here is the, just a second, here is these, quarterly reports and the numbers, and as you can see here, the gross margin is slightly stronger than last year even though the packaging was quite big, in, this quarter. Also the personnel cost has gone up.
We are building a group, a big foundation, make that strong in the group, so it takes a big effort, all this CSR and compliance and all that, but I'm coming back to that a little bit later in the presentation. Operating profit 9.3% as I said, and also, an operating—sorry, the tax here is around 21.3%. Looking forward for the tax, I think we will be around here 22%-25% for the full year. Quarterly, and as you can see here, Q1 is exactly the same turnover as it was in Q1 2022, and the margin here if you compare to Q1 last year is slightly stronger, not much but slightly. Operating cost, we are up here to SEK 78 million.
Here is also an impact of, if you compare this quarter with this quarter, here we also have a currency effect between 2022 and 2024, so the turnover has been boosted slightly with the currency effect, but so has also the cost. So the cost here, operating cost is up SEK 17 million, but also boosted by the currency effect. Operating margin 9.3% as I mentioned earlier, it is back on track again, but also as you—I will show you on the next graph here—what happens in 2021 and 2022 was extremely strong, and for you who have been with us for quite some time now know that an operating profit of between 10%-12% is normalized within Nilörngruppen, and 2021 and 2022 were extremely strong numbers.
As you can see here, we have had an extremely strong drop in Q4 2022, and here was especially, as I mentioned earlier, the outdoor segment that has been a tough period, and with that we now see coming back again. This is the same but in a graph where you will see that the first quarter here in turnover-wise is the same as this 2022, so this is the strongest quarter. If you also take 2022 into consideration, stronger quarter first quarter one we ever had in the group, and also looking at the profitability, this is—if you don't take 2021 and 2022 into consideration—this is the strongest Q1 profit-wise we ever had. Yeah, as normally Q2 and Q4 normally historically used to be the strongest quarter, but what has happened the last few years is that it's even out much more.
Also, depending on, we are much more expanding much more south of Europe, and also that we're going into other product segments that is not— that have has a different trends than the other ones, so it's even out much more during the year, which is good. Balance sheet, yeah, we have a strong balance sheet where we have started to build up now to be ready for doing the investments that we talked about earlier, both in Bangladesh where we will build a new factory, but also in Portugal where we will expand or build a new factory. Both these are on the project phases at the moment, but—and also as you already seen that the dividend this year will be SEK 1 per share versus SEK 5 last year, so we will pay out like SEK 11.4 million and save some cash for this expansion.
It's also proven that our own factories have been a really success factor at the moment. We see volumes moving out from Asia, sorry, from China and Hong Kong, going into Vietnam where we're now setting up our own operation, into Bangladesh, Pakistan where we see a good strong trend, and but also to Europe where we have our factory outside Porto. So that has been really strong factors for Nilörngruppen in our advantage. The key financial indicators, we'll not go through them in detail, see that the number of employees is starting to go up slightly again. It's mainly in Bangladesh where we have seen a strong development, but also we are employing some salespeople in Europe.
Also, when I talked about the balance sheet, we have seen the stock value has gone down or slightly stayed stable since the year-end, and we think now when this order income starts to take off again that we will not see a decrease in stock level as we have seen in the past. We made a good job on that in 2023 where we managed to decrease the stock level around SEK 50 million almost, but now when we see the order income start to take off again we will for sure see some increase in stock value, though we will monitor that and make sure that it will not increase as much as it did in 2022.
Split per product groups, here you can see the shift we've seen in the Q1 2024 is the increase in packaging where it now stands for 23% of the group turnover versus 16% last year, and here is the mixture. It's, for the luxury industry and also for some event here that we have seen now. And this is, also where you can see the shift if you compare Q1 2023 where, and there you can see that there's some decrease in the labels, increase in packaging, and increase in RIS, what we call Retail Information Services, which is all of the variable data: QR codes, NFC, RFID, and so on. It's in here. So in short, organic growth is back to 10%.
trend from previous quarters continues, still quite demanding stock of finished goods for the outdoor segment, and the outdoor segment for Nilörngruppen is especially in Scandinavia, UK, and Germany, mainly Germany and Scandinavia, I would say. Positive development in the luxury segment, and then we mean Italy and France for us, but we also notice some slowdown in not for Nilörngruppen, not in the numbers, but when talking to the clients. In general, more activity among our clients, but as you know, there's still a lot of uncertainties around in the world, so we are very much depending on that, what happens in the retail sector if people continue to buy garments and how that goes. Yeah, we expect normalization in the outdoor, as I mentioned. We have also now more focusing on our market department.
In the past, marketing and the design department was in one unit. Now we separate that to have more focusing on the marketing, to be seen more in the market, supporting sales, and we are doing so much good things, so we need to make much more noise in the market. So that's what we are working with now, so hopefully you will see that more from of Nilörngruppen in the future. Yeah, our distribution units, especially Bangladesh, Pakistan, and Portugal, go really good. Turkey, though, is, even though it's more stabilized, we see still a weak market due to high inflation, so not back on track, not yet. Our establishment in Vietnam goes as planned, and we expect it to have this up and running in the middle of the year fully.
I mean, the company is established, we employ people, and so on, but it takes time to get the business license and everything. Bangladesh and Portugal, as I mentioned earlier, that is in the project phase at the moment. Yeah, stock level is down, as you can see here, these SEK 36 million versus the same Q1 2023, but also I mentioned I don't think we will see so much lower stock level. I think this is a good level that we have reached at the moment. Presented at last quarter, we have a cooperation now with Worldfavor. What's going on here at the moment is we're doing a lot of presentations for clients in all countries, I would say, so it's a big interest, and it's big interest for Nilörngruppen Connect. It's, and this is a way for us to connect our clients for our core product.
The core will still be labeling and so on, and as I present later is that the label here is a really good information carrier with a QR code and so on. Yeah. And a little bit about Nilörngruppen Connect. Nilörngruppen Connect is our name for how we operate in the market, where here is the cooperation with Worldfavor and also the whole labeling with the QR codes and where you as an end consumer can scan your product and get the information. And the why and how we are doing this is, starting with the why here.
It's very much a legal aspect, coming from the European legislations, and our client, the brand owners, they are facing a lot of challenges both in the local regulations, EU Fiber Directive, and the Digital Product Passport, the DPP, that they need to fulfill. And through our cooperation with Worldfavor, we have a system to support our clients in this where they can now get information from their suppliers, and not only from their suppliers but from their suppliers' supplier, and their supplier, supplier, supplier, because this is what they need to fulfill and have information about towards the legislation. Yeah, and therefore, there is no excuse for not knowing according to the EU legislation any longer, so this is a big headache for our client.
Through our through this and through the cooperation with Worldfavor, we can support them in this, and through our labeling, we can support our clients with a good information carrier so you as an end consumer can scan and get the information that our brand clients, the brand owners, want to perform to give you. We also see that enabled circulate solutions for our clients. It's a lot of talking about repair, recycle, and resell, for the brands and, to be more a circular economy and to be more, sustainable. Much more customer engagement for you as a customer and for the brand owner to have a good cooperation, and they can have create loyalty programs and so on and acquire new customers through this. So this will be, yeah, I think this is really good, for us. This has been a strong concept.
We now, through the cooperation with Worldfavor and all with Nilörngruppen Connect, will have a complete solution, and this will be—we have launched that so already—but it will be much more now in the coming months with joining fairs, etc. Here is just a summary of this with Nilörngruppen Connect with unique QR codes, and you have a data carrier that the client can scan, and we can provide information to the end consumers about the Digital Product Passport, carbon footprint, OEKO-TEX certificates, and so on. Product history where you can see where the garment has been sold, if it has been repaired, etc. Production country, but it's very much up to the brand owners to provide information, and we will guide them and support them in this. The financial targets, this has been for many years now, and we will still have them.
revenue growth in excess of 7%, an operating margin of 10%, and net debt to EBITDA of 2x. As you remember now, we have an operating margin of 9.3%, but we're aiming for this. Good. That was the presentation. Oops. We'll see if we have any questions, Maria.
Yes, we have—excuse me—we have received some questions. We are running out of time, so we won't have the time to answer to them all, but I will pick some. There is one person asking what has contributed to packaging sales increasing between the years. Yes. Is there any special reason according to you?
It is—I mean, it's much more focus from our side on packaging that has been in the past. We knew that we have the client, and the same client also consumed packaging. The packaging we provide is not common brown boxes.
For us, it's more niche packaging for the garment and recycled poly bags and also textile bags for the luxury industry. So we are not in the basic, but we see an opportunity for us here that we have stepped in, and this has been a strategic decision for us to go in this much more. The margin is slightly lower in the packaging segment, but the volume is bigger, and we have the client, so I think that has been good for us.
Yeah, good. I think we have the time for one more question, and it is regarding the outdoor segment. You mentioned in the report that you expect a recovery in the outdoor segment during Q3. Could you please help us understand how conditions have changed for you to be able to guide for a recovery during Q3?
Mm-hmm. Yeah. As we said, what we suffered from in 2023 was especially in the outdoor sector where our client, the brand owners, had too much of end stock, so they had too much. And that was like a hangover from the really good strong years 2022 and 2021 where the outdoor sector was really booming, and then they ended up in 2023 with too much stock when we went back to normal. I think it was in the pandemic; everyone went out hiking, and then so we ended up in too much stock. And what we have seen now, the stock level is decreasing, and it's continued to do so, and they start to order again. So I think we have seen already in Q1 have some outdoor brands coming back, and that will continue to do so, I think, in Q2.
But to be back in full swing, I don't think we will see that before Q3. What I mean by that is that if first in Q3, I think the stock level is back to normal again. That is, not my guess, but talking to the client, that is what I got from them. Yeah, thanks for the clarification. We have received some more questions, but we have also replied to a lot of them during the presentation. And as we are running out of time, I think it's good maybe now to end this. Okay, very good. Thank you very much for listening, and we come back again here once in July again, and we presented the Q2 result. If you have any questions during the time here, don't hesitate to ask. Thank you very much, and have a great week. Thank you, bye.