Ending on a High Note

Ending on a High Note - 3 February

For results tables and graphs, click here.

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

In the 3 months to December, export sales decreased an average of 1.4%, and domestic sales increased 11.7% on average.

The NZMEA survey sample this month covered NZ$275m in annualised sales, with an export content of 60%.

Net confidence rose to 10, up from 8 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% markets and 22% skilled staff.

A net 45% of respondents reported a productivity increase in December.

Staff numbers decreased 7.9% 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 Dieter Adam.

“Export sales in December improved 10.01% on the same month in 2015, which was higher than the increase of 6.44% reported in November. These results translated into an average month decrease of -1.4% in the 3 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% 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 3 months to December remained high at 11.7%.

“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% 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% 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% on December 2015, while electrical machinery and equipment fell 13.5%. This is a reminder that we need to renew focus on building high-value exports and push for growth in these areas. ” Said Dieter.

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