North American PCB order growth fuels rise in book-to-bill ratio
IPC — Association Connecting Electronics Industries® announced today the June 2017 findings from its monthly North American Printed Circuit Board (PCB) Statistical Program. Strong PCB order growth moved the book-to-bill ratio up to 1.08 in June, while sales remained sluggish.
Total North American PCB shipments in June 2017 were down 3.9 percent compared to the same month last year. This year to date, shipments are 4.2 percent below the same period last year. Compared to the preceding month, June shipments increased 12.3 percent.
PCB bookings in June increased 18.6 percent year-on-year, driving year-to-date order growth up to 1.7 percent above the same period last year. Bookings in June were up 26.5 percent compared to the previous month.
“June’s strong order growth and a five-month trend of book-to-bill ratios above parity (1.00) are possible indications of an upturn in North American PCB sales in the second half of this year,” said Sharon Starr, IPC’s director of market research. “A turnaround in sales is likely to be modest, however, as order growth in the first half of 2017 is still just 1.7 percent above the same period last year, while sales since the beginning of this year have been consistently below last year’s levels,” she added.
Detailed Data Available
The next edition of IPC’s North American PCB Market Report, containing detailed June data from IPC’s PCB Statistical Program, will be available the week of August 7. The monthly report presents detailed findings on rigid PCB and flexible circuit sales and orders, including separate rigid and flex book-to-bill ratios, growth trends by company size tiers, demand for prototypes, and other timely data. This report is available free to current participants in IPC’s PCB Statistical Program and by subscription to others. More information about this report can be found at www.ipc.org/market-research-reports.
Interpreting the Data
The book-to-bill ratios are calculated by dividing the value of
orders booked over the past three months by the value of sales billed during the same period from companies in IPC’s survey sample. A ratio of more than 1.00 suggests that current demand is ahead of supply, which is a positive indicator for sales growth over the next three to six months. A ratio of less than 1.00 indicates the reverse.
Year-on-year and year-to-date growth rates provide the most meaningful view of industry growth. Month-to-month comparisons should be made with caution as they reflect seasonal effects and short-term volatility. Because bookings tend to be more volatile than shipments, changes in the book-to-bill ratios from month to month might not be significant unless a trend of more than three consecutive months is apparent. It is also important to consider changes in both bookings and shipments to understand what is driving changes in the book-to-bill ratio.
IPC’s monthly PCB industry statistics are based on data provided by a representative sample of both rigid PCB and flexible circuit manufacturers selling in the USA and Canada. IPC publishes the PCB book-to-bill ratio at the end of each month. Statistics for the current month are normally available in the last week of the following month.