Hi, I'm Francesca from the Investor Relations Team and CFO Florian Heindl, who will start with a presentation shortly. After the presentation, we will move forward with the Q&A session. With this, I hand over to you, Mr. Steirer.
Thank you, Francesca, and good morning to everyone. Welcome to the first quarter of the fiscal year 2024. My name, already mentioned, is Michael Steirer, and with me today are Robert Machtlinger, our CEO, and I'm very happy that we have the new CFO on board, with Florian Heindl. As always, we have already provided some detailed information in the financial press release we have issued earlier today, this morning. In case of any questions which may not be answered in today's session, as we have a hard limit at 10:00 A.M., then we will be happy to schedule some one-on-one meetings afterwards. Please let us know in the IR department, and then we can arrange something for you. Said this, I would like to now hand over to Robert Machtlinger, our CEO. Thank you.
Michael, thank you very much for the introduction, and also a warm welcome back on FACC for Florian Heindl. We're all glad that you joined us again. Ladies and gentlemen, good morning, good afternoon, or wherever you are. Greetings from China and currently here, so not being back home with my team, but I'm very pleased to present the Q1 results and share some information with yourself. Michael, next page, please. Well, if you go into a couple of highlights for the first quarter of 2024, first of all, and we are proud that the year 2024 is an important milestone for FACC. We are celebrating our 35th anniversary. Exactly 35 years ago, FACC was founded as an independent company, at that time very small, with roughly 100 people, and we developed nicely over the last 35 years to what we do today.
Coming back to the business, we see a continuation of the significant increase in aircraft demand following a more than 20% increase in top-line sales during the year of 2023. The first quarter of 2024 shows a nice continuation of this industry trend, where our revenues basically have increased by 24.6% compared to the first quarter of 2023. Also very positive is the development of the profitability of the company. Looking into the reports we have shared, first quarter of 2023 was slightly positive with a couple of thousand Euros. First quarter of 2024, yes, came in with an EBIT of EUR 9.9 million, which certainly was driven by volume, but also by a significant stabilization of supply chains worldwide, helping us to better perform in operation. Headcount has been increased within the year to 3,612 people.
So in total, we have added 602 people to the FACC Group, mainly in Austria and in Croatia, but also in the rest of the world. What we see for the coming quarters is that customer demand gets confirmed. We have a solid order book, of course, for 2024 and beyond, and we see a constant increase of production rates across the platforms we are represented on. And by having the customer input and having good discussions and having good insight to the market, we can confirm the 2024 guidance with a 10%-15% year-on-year growth. Next slide, please, Michael. If we look into the development of the divisions, comparing Q1 2023 to Q1 2024, Aerostructures has a significant improvement in demand and in outputs. As you all know from the past, Aerostructures is a strong segment of FACC.
Aerostructures was the strongest division in terms of sales and EBIT before COVID. With COVID, with a significant drop in demand because of the wide-body business and some narrow-body businesses, this business right now returns, which is good, I have to say, in terms of top-line but also profitability. Engines & Nacelles still are growing a little bit sideways for the first quarter of 2024 compared to 2023. Engines & Nacelles has a strong portfolio on the A350 but also the 787. Especially A350 is ramping up. 787 will ramp up late in the year as well. So first quarter still sideways, but in the outlook of 2024, we also will see an increase in demand and output here as well.
Interiors pretty much following the trend line linearly to the last couple of years, benefiting from a higher demand of narrow-bodies, here mainly A320 family, but also the business jet segments, Bombardier and Embraer is picking up in demand. So overall, positive news, positive growth in the first quarter of 2024, and the outlook for the next periods is very much the same. Next page, please. Well, in saying that, I think I immediately would like to hand over to Florian, giving you a heads-up on the financials. And I will come back to you later with the guidance.
Thank you, Robert and Michael, for your kind introduction. First of all, I want to state that I'm really glad to be finally back at the company that I always loved working with. As maybe some of you know, I was with the company 5.5 years, and now, after two years' absence, I returned, and I'm really glad that the Supervisory Board selected me as the new Chief Financial Officer. Now I want to guide you through the financial slides of the presentation. First of all, coming to revenues and EBIT, you see Q1 revenue coming in with EUR 202 million, confirming the upward trend from 2022. As you all know the industry very good, you know that the 10% drop from Q4 is nothing to worry about, as the last quarter of each year is usually a strong one.
In terms of EBIT, we are happy to report the second consecutive positive quarter since Q2 2022, further proving stabilization and upward trend in our business, and of course, still room for improvement. Michael, next slide, please. Coming to free cash flow, and I'm sure you started already our reporting from today's morning, in terms of free cash flow in Q1, you can identify a slight improvement from one year ago, but of course, the situation is nothing that makes the CFO really happy. We still had a big increase in working capital in Q1, mainly coming out of an increase of inventory to secure deliveries to our customers. On top of that, you have roughly EUR 10 million cash outflow coming out of investments, which is largely driven by our plant expansion in Croatia.
In general, our goal is to have improvements in the whole cash conversion cycle coming up later in the year to further stabilize our supply chains. Next slide, please. On slide 8, coming to investments again and leverage, I already touched the investment figures on the slide before, largely dominated by Croatia. The plan is to finish our expansion in Croatia by end of Q2, and as you all know, as with every larger investment, we will still have cash outflows in the later quarters of the year, referring back to the investment in Croatia. In terms of leverage, we had a strong year-end figure of 2023, which now was, of course, impacted from the cash burn in our first quarter 2024. The next testing of our leverage will be at half-year 2024, with a ratio to be achieved of 4.25. So handing back to Robert for the outlook.
Next page, please. Well, thank you, Florian. Well, the outlook, I think, is pretty much a confirmation of what we have guided at the beginning of the year, and with the results presentation of the 2023 results, we see a confirmation of further growth in the industry and, of course, in FACC. We see a spread of 10%-15% bringing the top-line of the FACC revenues into a range of EUR 810 million-EUR 850 million at the end of the year. We, of course, are heavily engaged with managing the industry ramp-up. This is getting more and more solid, I have to say, compared to last year. The stabilization of the supply chains shows a very positive trend.
I think all the measures we have taken last year by putting task forces into our suppliers, supporting them on long-term visibility, in the one or the other area, setting up a second source or changing suppliers right now is paying back. So we see good stability here, and this, of course, helps us in running our production in a more efficient way. The same is true for people ramp-up. In the first three months of the year, we have added more than 150 people to our organization. We take a strong focus on training and qualification because safety and quality come first in the industry and in FACC. I also can mention at this point that we have invested last year into a new welcome and training center for our new employees, but also for the existing employees, to keep qualifications and continuous retraining at the highest possible level.
All of those actions taken last year, I think, is giving us a tailwind for the year 2024. Completion of plant number six is, of course, very important for FACC. Florian mentioned that we have released another EUR 10 million in the first quarter to complete the facility. We are very advanced with the setup. Building is pretty much ready. We are, as we speak, putting in the equipment, and starting with the third quarter of this year, we will have access to the extension of the facility, again, benefiting from the lower labor costs re-entering the facility. Continuous increase in cash flow and profitability is on top of the agenda. Florian mentioned there was some step-up in inventory in the first three months. We want to do this to be protected from the one or the other supply chain issue. We need to protect ourselves, but also our customers.
We think we are at the peak level right now. With the further stabilization of the supply chains, where we are giving ourselves at least a quarter as a safety, we will ramp down inventory to generate cash. And profitability, as said before, comes together with volume and efficiency increases. Leverage targets of 4.25 is the target we have to meet in June, and at the time being, we don't see an issue coming up here based on the performance of the first quarter. Well, and again, we can reconfirm the market development with the FACC portfolio, with all of our customers across the commercial airplane segment, including business jets, and I'm happy to say that also the Urban Air Mobility business, where we are engaged, as you know, with certain customers, is taking a momentum as we speak.
In saying that, we want to give you more time for raising your questions. I thank you for your attention, and the floor is yours.
Yeah, thank you so much for the insightful presentation. We are now moving forward to the Q&A session. To keep the Q&A session engaging, we kindly ask you to pose your question via the audio line. To do so, you can just press the button "Raise Your Hand." If you're dialed in via phone, you can do this with the key combination star 9 followed by star 6, or you can also dial in via phone. We got a first question from Bastian Brach. Thank you so much, Basti. You could speak now.
Thank you very much, and great quarter, guys. First one, I have a couple of questions. First one on the supply chain. You already mentioned it a bit that it's improving still, but can you maybe give an outlook? When do you see the supply chain fully recovered to maybe the level you saw pre-COVID? Is it during the second half of this year or 2025 or even later? Just some additional color, that would be great. Then second one, you have seen quite a step-up in the EBIT margin in the interior business. So is that already the productivity improvement from your Croatia plant, or are there other moving parts in there you would like to mention? And then the third one, I have seen you mentioned your investment volume at EUR 50 million for this year. Can you give us a breakdown? What does this include?
I think maybe most of it will be in Croatia, also your training center. But yeah, maybe you could quantify what other moving parts are in there. Thank you.
Of course, Bastian, I can answer your questions. On the supply chain stability, I can give you two very concrete numbers. During the first phase of last year, we had an on-time KPI from all over our suppliers in the ballpark of 75%-78%. So a quarter of deliveries we had to bring in with expedite costs or special efforts because our purchase order date was not met by the one or by, let's say, a higher amount of suppliers. This does not mean that we had 25% end product delivery problem because our deliveries to our customers, we kept at 100% on time. As we speak, the on-time delivery of our supply chain in the first quarter is close to 98%.
So there is a big step-up in on-time delivery from the supply chains into FACC, and there is, well, 2% supply where we need to take extra efforts to fulfill our internal production date. So you see a significant improvement. If in the early phase of 2023, chemicals was a problem to get it on time, this is all gone. At the time being, we see the one or the other exotic material being a challenge for the industry if we work together. Here we have buffer stock already in place, but again, buffer stock is not what we like to see in the long run. And in being specific, when is it fully back to pre-COVID stability? Well, I think we need the year of 2024. Rates are further ramping up.
We are watching the supply chain very, very carefully because there is noise in the supply chain. But overall, as you can see by the figures, big improvement. Interiors, is this answering your question, Bastian?
Yeah. Yeah.
On interiors, I think it's a mix of various things. Why we show a good result, first of all, I think efficiency measures are taking momentum. We had a couple of new program launches in the year 2022, 2023. As always, once we are introducing a new cabin variant, we have a lot of Heads of Version. Every customer wants to switch to the new cabin configuration. This is causing us always, also from the history, learning curve and ramp-up costs. Here, we are stabilizing at the first element. The second element, of course, more and more work is done in Croatia. Croatia, as you know, is a dedicated interior facility. Momentum from Croatia comes more and more. Also in Croatia, of course, we had ramp-up costs in the first year of operations.
Also here, we see learning curve, and the Croatian facility is exactly delivering the benefits and savings we have calculated. Right now, we are in the early phase of harvesting, and with the introduction of further volume into the extension, I think in the next two years, we will have a nice facility there helping us on the long-term sustainability of interiors. And third, but not least, there was the one or the other cost compensation settlement with customers, also in the interior field, helping us to increase pricing and supporting the profitability of the interiors. And in terms of investments, well, a big portion goes into the interior facility, round about EUR 12 million ± for the fiscal year 2024. Round about EUR 25 million is program-related investments, which is tools, which is special equipment, where most of this investment also is customer-paid.
The reminder, which is the remaining portion, which is round about another EUR 10 million, is CapEx in other facilities in the Upper Austrian facilities to support the further ramp-up of the industry.
Yeah, thank you so much, Mr. Brach, also Mr. Machtlinger, for answering the question. As a reminder for you, the audience, you can also pose the question via our chat. So if you can't speak freely today, you can also do it here. And we haven't got another question, so let's wait a little bit until more questions are coming in. Again, also a reminder for you, if you're dialed in via phone, you can ask the question with the key combination star 9 followed by star 6. And oh, we got another question by Mr. Brach.
Yeah. And just to follow up to your answer to the investments, so did I get it right, the EUR 25 million program-related investments, this is fully compensated by your customers. So yeah, it is no additional investments from your side alone, but you get compensated for that. Is that right?
Correct. It's based on milestone payments. So if we deliver, let's say, First Article, we get the milestone paid, or if we order a tool, and the tool is available here, we have agreed with customers to pay us. You're right. I can confirm, Bastian.
Okay. Thank you.
Thank you so much for the follow-up question. We got another question from the chat. Given the solid start of the year, would you consider your guidance for sales growth of 10%-15% as prudent, or do you expect some specific phasing effects in Q2?
Well, if you look into our Q2, I think Q2 is very stable. We see a continuation pretty much in Q2, what we have seen in Q1. As always, Q3 is a little bit of a weaker quarter because of certain shutdowns during the summer period with our customers. So volume is normally less in Q3. So Q2 will follow Q1, pretty much Q3, a little bit of seasonality, as we always have it. And I think Q4, as Florian mentioned before, is always the strongest quarter in FACC in terms of output. So that's a little bit the seasonality we are expecting, and this will not be different in 2024.
Thank you so much for answering this question. Yeah, again, one last reminder for everyone. If you would like to pose a question via the audio line, or the key combination star 9 followed by star 6, or the chat box. Let's wait a couple of seconds more. Seems like we do not have any more questions for us today. Thank you so much to the leadership team for this insightful presentation. And on behalf of today's earnings call, we're coming on to a close of this earnings call. Should you have further questions in the future, please do not hesitate to contact the Investor Relations team. And on behalf of Montega, I wish you a beautiful day. And I hand over now to Mr. Steirer for some final remarks.
Thank you, Francesca. I would like to take this opportunity to thank all of you for participating in today's call. And as mentioned, in case you have any further questions afterwards, please let us know in the IR department, and then we can schedule some other one-on-one meetings if requested. At this point in time, I wish you another successful day and look forward to further discussions. And maybe, Robert, I'd like to hand over to you back to you for maybe a final statement. Thank you.
Well, Michael, you said everything. I want to thank all of you for participating. I wish all of you a nice day as well and best greetings from China this week.
Thank you so much.
Thank you.
Thank you.
Thank you. Goodbye.