Posts Tagged ‘Tchamkertenian’

  • Printing sector tops nation’s economic growth – PIAA

    Economic growth data shows that the printing industry was one of the fastest growing sectors of the Australian economy during the March 2013 quarter outstripping national economic growth according to figures released by the Australian Bureau of Statistics (ABS).

    The printing industry expanded by 2.5 per cent in trend terms during the March 2013 quarter the fourth fastest growth rate of the broad industry sectors comprising the Australian economy. In fact, the printing industry grew by a robust 18.3 per cent during the year to March 2013, according to analysis conducted by the Printing Industries Association of Australia (Printing Industries).

    The printing industry’s contribution to the economy stood at A$4,137 million during the year to March, an increase of 5.0 per cent on the previous period, according to the new data from the ABS.

    Hagop Tchamkertenian (pictured), Printing Industries national manager for Policy and Government Affairs, welcomed the growth figures as an indication that the industry seems to be on a sustained path to economic recovery.

    “On an annual basis the printing industry was the outstanding growth sector of the Australian economy during the most recent quarter. The industry is crawling back some of the activity that was lost during the most recent economic downturn caused by the Global Financial Crisis (GFC). There is still some way to go as even after this impressive figures, the printing industry’s gross value added remains 15.8 per cent lower than the peak reached prior to the GFC,” he said.

    Tchamkertenian reported that during the past week a number of other pivotal industry economic indicators were released by the ABS covering sales, pre-tax profits and investment in new capital expenditure.

    “The latest quarterly sales data shows sales in the printing industry rose for the fourth consecutive quarter to register a 4.2 per cent growth on the previous quarter. Compared to March quarter of the previous year the increase in sales is in the order of 17.5 per cent. At $7,634 million during the year to March, printing industry sales have improved by 3.9 per cent on the previous period’s reported outcome,” he said.

    Continuing the recent trend, Tchamkertenian confirmed that the good news did not spread to pre-tax profits or new capital expenditure outcomes.

    “The ABS data on pre-tax profits covering larger printing business (those employing 20 or more employees) show that there has been a massive deterioration both on a quarterly basis as well as on a yearly basis,” he said. “The March quarter represented the seventh consecutive quarter reported fall.

    “The reported pre-tax profit figure of $195 million for the 12 months to March represents a deterioration of $406 million or 67.6 per cent on the previous period’s outcome. Once again the profit data confirms that industry margins are under considerable pressure.

    “New capital expenditure figures also show ongoing deterioration with the March quarter outcome representing the sixth consecutive quarter reported fall. During the March quarter new capital expenditure fell by 5.3 per cent compared to the previous quarter and was down by 33.3 per cent on the previous year’s quarter,” he said.

    Tchamkertenian also reported that the capital expenditure data showed that the printing industry spend some $159 million on new capital expenditure items over the 12 months to March 2013, a 41.3 per cent deterioration on the previous periods reported outcome.

    “Clearly one needs to be careful when examining the new capital expenditure data especially for an industry such as printing that is undergoing massive restructuring and consolidation. Many operators are no doubt realising certain commercial benefits by purchasing used but reasonably new and efficient assets and such activity is distorting the new capital expenditure data,” Tchamkertenian said.

     

  • New industry investment at a 20 year low – PIAA

    Investment of new equipment within the Australian printing industry is at a 20 year low, with total new investment spend at its lowest level since 1991, according to a Printing Industries report published this week.

    For the year ending December 2012, total new investments stood at just $181million for the local printing industry, the lowest level since the June quarter in 1991.

    Printing Industries indicates that, with the local industry’s consolidation ramping up – following the administration of the likes of GEON and Vega Press – it is likely that there are more printing companies acquiring second-hand equipment in favour of new machinery.

    “While the capital expenditure figures look bleak they too need to be placed in perspective,” said Hagop Tchamkertenian (pictured), Printing Industries national manager for Policy and Government Affairs. “So, by just focussing on new investment data and not factoring total investments, which include used machinery and equipment, a somewhat distorted picture can emerge.

    “There is no doubt that as the industry consolidates further and as industry participants deal with the idle capacity issue, new capital investment data will continue to be affected for some time to come,” he said.

    Despite the bleak new investment figures, economic growth data released this week by the Australian Bureau of Statistics (ABS) for the December 2012 quarter shows that the printing industry surged ahead during the quarter to record the highest rate of growth amongst the manufacturing sectors.

    The buoyant performance also placed the printing industry amongst the most rapid growth sectors of the Australian economy with only the mining and resources and utilities sector reporting superior outcomes.

    The ABS data shows that the printing industry registered solid growth rate of 5.7 per cent during the December 2012 quarter, the third consecutive increase, to register a growth rate of 14.0 per cent during the year to December. The industry’s total gross value added defined as its contribution to the Australian economy totalled some A$3,989 million during the year to December.

    The December quarter economic growth outcome represented the highest outcome in four years. Tchamkertenian said that, while the growth figures are very encouraging they do need to be placed in a proper perspective.

    “We certainly have some impressive numbers to boast about and this is good for the industry,” he said. “However, we need to consider that the data covers a time in the past and industry as a whole is still trading considerably below Global Financial Crisis (GFC) levels. The full year result to December is still down by 1.9 per cent and based on my analysis with the industry’s gross value added remaining 16.8 per cent lower compared to the pre-GFC period.

    “While we know that some of that activity has been permanently lost to the industry due to industry structural issues including the migration of printed matter to e-platforms, the latest economic growth data confirms that the printing industry is showing signs of revival,” he said.

    Tchamkertenian also reported that during the past week a number of key industry indicators released by the ABS also point to an upward movement in some areas.

    “Printing industry sales for instance also improved during the quarter by 4.1 per cent, up by 8.9 per cent on the same period a year earlier. Sales have now been increasing for three consecutive quarters and surpassed the $7.3 billion level for the year to December,” he said.

    According to Tchamkertenian, an area of key industry data under pressure is profitability or industry margins, which declined by a noticeable 17.5 per cent during the quarter and was reported to have declined by 66.4 per cent on the same period a year earlier.

    “Profitability data shows six consecutive quarters of falls. The latest quarter outcome is almost at a four year low. This confirms that industry margins are still being subjected to intense pressure,” said Tchamkertenian.

    He said that while the Australian economy continued to grow, the rate of growth in trend terms at 0.6 per cent during the quarter was the weakest since March quarter 2011. As a consequence, the annual rate of growth fell from 3.4 per cent to 2.9 per cent.

    Contributing to growth during the latest quarter were household expenditure, public investment and net exports. General government expenditure and non-dwelling construction detracted from economic growth during the December quarter.

    At an industry sector level mining, utilities, wholesale trade, financial and insurance services, and health care and social services contributed to economic growth, while agriculture, forestry and fishing detracted from growth.

    The breakdown of the data at the state and territory level shows that in trend terms Northern Territory, Western Australia, New South Wales, Queensland, and the Australian Capital Territory all expanded; while Victoria, South Australia and Tasmania contracted during the year to December.

    “It is interesting to note that while the rate of growth of the economy is showing signs of slowing down in trend terms, the growth rate in the printing industry remained solid,” said Tchamkertenian. “There are various reasons for this development. Print remains an effective communication medium and it could herald a return to the medium as economic conditions become a bit more challenging.”

    According to Tchamkertenian, there is also the statistical effect that as the printing sector starts recovering some lost ground from the lows it reached during the post-GFC period, the current increases by their nature will appear more significant due to the effect of the recovery taking place from a much lower activity base.

    “Having provided some possible explanations to the latest economic growth numbers, you cannot mask the fact that there are clear signs that the printing industry may once again be re-emerging from its recent lows, which is a very welcome development,” Tchamkertenian said.