26 August 2005 IMMEDIATE RELEASE
Ask not for whom the bell tolls….
The latest Canterbury Manufacturers’ Association Survey of Manufacturers completed during August 2005, shows total sales
in July 2005 were up marginally at 0.15%, (export sales up 4% and domestic sales down about 4.2%) on July 2004.
The Canterbury Manufacturers’ Association survey sample this month reported around NZ$583m in annualised sales, with an
export content of 53%.
“Total sales on a par with last year, little profit on slightly increased export sales and a trend of falling domestic
sales have all worked out to feeling much the same as last month” said John Walley, Chief Executive of the Canterbury
Manufacturers’ Association. “On top of that the NZ dollar bounced and blowing the sugar off what might have been better
export returns.”
“Net confidence at -13 help on the levels seen last month toward the levels seen in early 2005 but still down on last
year.”
“Building and construction report strong demand, although some supply lines are indicating falling demand and other
signals show that the rate of penetration by trade from Asia is accelerating. This is supported by our ever-increasing
trade deficits with Thailand, Singapore and of course, China.”
“We should get little comfort from trade deficits hitting levels last seen in New Zealand in the late 70’s
post-Britain’s entry in to the EC. Escalating oil prices and the pervasive impact that will have on the cost of most
things; transport now and petrochemicals in a few months will only serve to put more pressure on the deficit growth.”
“Staff numbers continue to show an increase, the difficulty in finding staff in some areas is easing.”
“The headline company and job losses for the month, Debonaire Products, Abrahams Furniture and Swandri perhaps paint the
future – some policies can help in this regard, it’s getting time to do something, tomorrow will be too late.”
“We commented last month that the indications are that only a few export companies are profitable right now – the bad
news is that it is not “bad news” until we see job losses and closures.
The current performance index (a combination of profitability and cash flow) stands at 95 down from 97 last month, the
change index (capacity utilisation, staff levels, orders, and inventories) sits at 103 up from 99 last month, the
forecast index (investment, sales, profitability and staff) is at 98 down from 100 last month. Overall things are
tightening and expected to get more difficult.
“Strong concerns were expressed around the increasingly fashionable tax funded vote auction. Our members would prefer to
see a set of coherent tax incentives targeted to encourage and support productive investment than a lolly scramble.”
“One way or another, before it can spent it has the be earned! Without export growth one day soon we will simply not be
able to buy what we want.”
Constraints focused on staff ~13% and markets ~75% and capacity ~13%. Staff numbers reported an increase in the month of
just under 2%.
Net sentiment reported in this survey stood at –13, equal to last month. The year on year change stood at -25.
ENDS
CANTERBURY MANUFACTURERS' ASSOCIATION
Survey of Business Conditions – July 2004 compared with July 2005
SAMPLE SIZE: The Survey respondents represent elaborate transformed manufacturers with annual sales of approximately
$583 million.
CHANGE OVER 12 MONTH PERIOD
(The table below represents the above returns expressed as percentages)
July June
TOTAL TURNOVER:
Export /Domestic ratio 53/47 43/57
% Change in Total Turnover INCREASED 0.15 -11
DOMESTIC TURNOVER:
% of respondents reporting a rise 36 44
% of respondents reporting a fall 36 37
% of respondents reporting no change 29 19
% Change in Ave Domestic Turnover DECREASED -4.02 -3.57
EXPORT TURNOVER:
% of exporters reporting a rise 40 40
% of exporters reporting a fall 60 60
% of exporters reporting no change 0 0
% Change in Average Export Turnover INCREASED 4.17 -19.42
STAFF NUMBERS:
% of respondents reporting a rise 64 69
% of respondents reporting a fall 28 19
% of respondents reporting no change 7.1 12.5
% Change in Average Staff Numbers INCREASED 1.95 6.78
CHANGE OVER 12 MONTH PERIOD
(The table below represents the above returns expressed as percentages. Last month in brackets.)
Large Fall
(Over 15%)
Modest Fall
(2.5%-15%)
No Change
(Within 2.5%)
Modest Rise
(2.5%-15%)
Large Rise
(Over 15%)
July
June
July
June
July
June
July
June
July
June
Profitability (YoY)
25
24
25
6
31
41
6
24
13
6
Cashflow (YoY)
6
12
25
12
50
65
19
6
0
6
Exchange Rate (YoY)
7
12
20
24
60
47
7
12
7
6
Investment Forecast
19
12
6
0
44
47
31
24
0
18
Sales Forecast
13
12
25
29
25
18
38
41
0
0
Profit Forecast
25
12
19
29
13
12
44
41
0
6
Staffing Forecast
6
6
19
29
50
35
25
29
0
0
Confidence
Very
Negative
Negative
Neutral
Positive
Very
Positive
13
6
19
38
50
25
19
31
0
0
Constraint
Production
Skilled Staff
Capital
Market
13
6
13
18
0
0
75
76
Net Confidence Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec
2003 +21 -6 +12 -11 -5 +12 -6 0 +11 +40 +29 +33
2004 +5 +19 +41 +41 +36 +50 +12 +20 +7 0 -7 +5
2005 +13 -13 -6 -25 -33 -13 -13
Index (base =100) Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec
Performance 105 100 99 95 95 97 95
Forecast 103 98 104 102 99 100 98
Change 104 99 101 103 100 99 103