Man­u­fac­tur­ers end year on a high note

DEMM Engineering & Manufacturing - - NEWS -

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Man­u­fac­tur­ers and Ex­porters As­so­ci­a­tion (NZMEA) Sur­vey of Busi­ness Con­di­tions com­pleted dur­ing Jan­uary 2017, shows to­tal sales in De­cem­ber 2016 in­creased 7.23 per­cent (year on year ex­port sales in­creased by 10.01 per­cent with do­mes­tic sales in­creas­ing by 3.30 per­cent) on De­cem­ber 2015.

In the three months to De­cem­ber, ex­port sales de­creased an av­er­age of 1.4 per­cent, and do­mes­tic sales in­creased 11.7 per­cent on av­er­age. The NZMEA sur­vey sam­ple this month cov­ered NZ$275m in an­nu­alised sales, with an ex­port con­tent of 60 per­cent.

Net con­fi­dence rose to 10, up from eight in Novem­ber.

The cur­rent per­for­mance in­dex (a com­bi­na­tion of prof­itabil­ity and cash flow) is at 99.3, up from 98.3 last month, the change in­dex (ca­pac­ity util­i­sa­tion, staff lev­els, or­ders and in­ven­to­ries) was at 101, with no change from the last sur­vey, and the fore­cast in­dex (in­vest­ment, sales, prof­itabil­ity and staff) is at 104.5, up on the last re­sult of 103.2. Any­thing over 100 in­di­cates ex­pan­sion.

Con­straints re­ported were 78 per­cent mar­kets and 22 per­cent skilled staff. A net 45 per­cent of re­spon­dents re­ported a pro­duc­tiv­ity in­crease in De­cem­ber. Staff num­bers de­creased 7.9 per­cent year on year in De­cem­ber. Su­per­vi­sors, trades­per­sons, man­agers, pro­fes­sional/sci­en­tists and op­er­a­tors/ labour­ers re­ported a mod­er­ate short­age.

“De­cem­ber’s man­u­fac­tur­ing sales re­sults showed a good bounce back from the re­sults seen in October, Septem­ber and July, par­tic­u­larly in ex­port sales – man­u­fac­tur­ers ended the year on a high note,” said says NZMEA Chief Ex­ec­u­tive Di­eter Adam.

“Ex­port sales in De­cem­ber im­proved 10.01 per­cent on the same month in 2015, which was higher than the in­crease of 6.44 per­cent re­ported in Novem­ber. These re­sults trans­lated into an av­er­age month de­crease of -1.4 per­cent in the three months to De­cem­ber, which was still held down in the nega­tive due to a poor month for ex­ports in October.

“Do­mes­tic sales in De­cem­ber stayed pos­i­tive with a 3.3 per­cent in­crease on De­cem­ber 2015. This was, how­ever, a mod­er­a­tion on the ex­cep­tional growth felt in the pre­vi­ous three months. The av­er­age monthly growth of do­mes­tic sales in the three months to De­cem­ber re­mained high at 11.7 per­cent.

“We can now get a good pic­ture on how the man­u­fac­tur­ing sec­tor fared in 2016. Do­mes­tic sales ex­pe­ri­enced an av­er­age monthly growth of 5.8 per­cent on the pre­vi­ous year’s months over the last 12 months, rep­re­sent­ing a pos­i­tive trend of do­mes­tic sales. Ex­port sales saw an av­er­age monthly growth of 2.1 per­cent in the same pe­riod. 2016 most def­i­nitely had its ups and downs for man­u­fac­tur­ing sales, but over­all, the trend showed solid growth for the year over­all.

“The down­ward trend in ex­port sales to­wards the end of the year was con­cern­ing – though the last two months of the year did turn this around some­what. Weak ex­port num­bers have been re­flected in the Sta­tis­tics New Zealand num­bers – in De­cem­ber, me­chan­i­cal ma­chin­ery and equip­ment ex­ports fell 8.83 per­cent on De­cem­ber 2015, while elec­tri­cal ma­chin­ery and equip­ment fell 13.5 per­cent. This is a re­minder that we need to re­new fo­cus on build­ing high­value ex­ports and push for growth in these ar­eas,” said Adam.

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