November 4, 2009 – “We’re finally starting to see the turnaround,” was the welcome quote from Denny McGuirk, president of IPC – Association Connecting Electronics Industries. McGuirk issued that statement when IPC announced the PCB industry statistics on growth rates and book-to-bill ratios for the month of September.
McGuirk’s full quote was, “We’re finally starting to see the turnaround in the September numbers for the North American PCB industry. Both rigid PCB and flexible circuit sales and orders are up by double digits compared to August. Rigid PCB sales and orders are still below September of last year, but the rate of decline is shrinking. Flexible circuit business is ahead of September last year. The most promising indicator is the book-to-bill ratio at 1.08. It has been above parity for five consecutive months.”
Year-on-year, rigid PCB shipments declined 15.9 percent and bookings were down 7.8 percent. Year-to-date, shipments are off 27.3 percent and bookings 24.7 percent. Month-to-month, however, rigid PCB shipments grew by 21.7 percent and bookings 29.7 percent.
September’s flexible circuit shipments were up 7.9 percent and bookings up 12.1 percent year-on-year. Year-to-date, flexible shipments are down 1.5 percent and bookings down 4.9 percent. Month-to-month, shipments were up 22 percent and bookings up 48.1 percent over August.
Combined figures for the two circuit types show a 14.3 percent decline in shipments and a 6.4 percent decrease in bookings year-to-year. Year-to-date declines are 25.5 percent and 23.4 percent respectively. Month-to-month growth was 21.8 percent for shipments and 31 percent for bookings.
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 two to six months.
IPC explains that the rigid PCB segment heavily affects book-to-bill and growth rates for flexible circuits. Rigid PCBs represent an estimated 91 percent of the current PCB industry in North America, according to a recent IPC report.
In reporting the September numbers, IPC also pointed out that its monthly survey tracks bookings and shipments from U.S. and Canadian facilities, which provide indicators of regional demand. The numbers do not measure U.S. and Canadian PCB production. To track regional production trends, IPC asks its survey participants for the percentage of their reported shipments that were produced domestically—in the U.S. or Canada. In September, 84 percent of total shipments reported were domestically produced. Domestic production accounted for 84 percent of the rigid PCB and 86 percent of the flexible PCB circuit shipments accounted for in the survey. IPC maintains its survey sample throughout a calendar year. So come January, the mix of companies reporting their figures to IPC may change slightly.
