Jumping January reports afdec

Component sales through distribution in the UK and Ireland increased by 21% in January compared to December and by 14.5% y-o-y, says afdec, part of ecsn.

 “Compared to the same period 2017, semiconductors sales increased by 16% in January”, and sales of “Passives” also showed a 16% increase”, says ecsn chairman Adam Fletcher, “Electro-mechs increased by 31% while “Component Assemblies” increased by 11%. However, our catch-all “Other Products” reporting group showed a small (5%) decline compared to the same month 2017″.

The Book-to-Bill ratio declined ‘by 13 points to 0.98:1 in January ’18, but afdec/ecsn members welcomed an increase in overall Bookings (Net Sales Entered) of 8% compared to December ‘17, together with a 6% increase over January 2017.

“The polynomial trend line suggests a positive B2B ratio as we progress further into 1H ‘18″, says Fletcher, “the Sales by Month ‘three month moving average’ for all electronic components suggests that continued growth into 1H ‘18 is likely, which is broadly in-line with longer term historical trends”.

UK Manufacturing Purchasing Managers’ Index
The IHS Markit/CIPS UK Manufacturing Purchasing Managers’ Index (PMI) in January reported a decline of 1 point on the previous month against a backdrop of rising price pressures. The organisation believes that growth in new orders is continuing but the rate of growth is now slowing and is at a seven-month low.

According to IHS Markit/CIPS, organisations are increasing their forward order cover to gain volume discounts and increasing their selling prices to customers, but demand needs to increase over the quarter to drive ongoing growth.

ecsn/afdec members broadly agree that UK customers remain positive about their business prospects into 2018 and are continuing to add order cover to meet customer demand.

“I suspect most customers have now slightly increased their in-house inventory to reflect the extended manufacturer lead-times and are placing longer term schedules on their distributors, in-line with forecast demand “,  adds Fletcher, “our members anticipate continued sales revenue growth in 1H’18” and are diligently managing their inventory in-line with demand from their customers”.

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