The latest New Zealand Manufacturers and Exporters Association (NZMEA) Survey of Business Conditions completed during November 2012, shows total sales in October 2012 increased 7.05% (export sales increased by 1.90% with domestic sales increasing 11%) on October 2011.
The NZMEA survey sample this month covered NZ$594m in annualised sales, with an export content of 42%.
Net confidence improved to -18, up from the -33 result reported last month.
The current performance index (a combination of profitability and cash flow) is at 93.5, down from 98.0 in September, the change index (capacity utilisation, staff levels, orders and inventories) stayed the same as last month at 96.0, and the forecast index (investment, sales, profitability and staff) is at 98.5, up on September’s result of 96. Anything less than 100 indicates a contraction.
Constraints reported were 82% markets and 9% production capacity.
Staff numbers for October decreased year on year by 3.1%.
“We are seeing some increases in exports, but the large majority of the improvements in total turnover are being fuelled by domestic sales” says NZMEA Chief Executive John Walley.
“The domestic gains in turnover were patchy; although average domestic turnover increased by 11%, only 36% of respondents reported a rise.”
“It is not unusual for our real numbers (this is the only survey that reports actual sales and job numbers) not to correspond with our sentiment indexes, sentiment says contraction and the numbers say sales expansion and job contraction. All up, I think the employment trend is the most telling and we should be concerned.”
“Market conditions continue as the main constraint on sales.”
“Opportunities are seen in the Christchurch rebuild, winning some new customers, but the major threats continue to be the exchange rate and soft demand.”
“The reported decrease in staff numbers, coupled with the long term trend of no growth continues to underpin the story of uncertainty and corresponding risk avoidance.”