IPC releases PCB results for April - shipments and bookings up

IPC announced the April findings from its monthly North American Printed Circuit Board (PCB) Statistical Program.

PCB Industry Growth Rates and Book-to-Bill Ratios
Rigid PCB shipments are up 12.2 percent and bookings are up 5.6 percent in April 2008 from April 2007. Year to date, rigid PCB shipments are up 6.6 percent and bookings are up 12.9 percent. Compared to the previous month, rigid PCB shipments decreased 14.7 percent and rigid bookings decreased 19.3 percent. The book-to-bill ratio for the North American rigid PCB industry in April 2008 edged up above parity to 1.01.

Flexible circuit shipments in April 2008 are up 22.8 percent and bookings are down 4.8 percent compared to April 2007. Year to date, flexible circuit shipments are up 5.0 percent and bookings are down 14.3 percent. Compared to the previous month, flexible circuit shipments are down 12.5 percent and flex bookings fell 16.8 percent. The North American flexible circuit book-to-bill ratio remained at 0.99.

For rigid PCBs and flexible circuits combined, industry shipments in April 2008 increased 12.9 percent from April 2007, and orders booked increased 4.8 percent from April 2007. Year to date, combined industry shipments are up 6.5 percent and bookings are up 10.6 percent. Compared to the previous month, combined industry shipments for April 2008 are down 14.6 percent and bookings are down 19.1 percent. The combined (rigid and flex) industry book-to-bill ratio in April 2008 reached 1.01.

"The industry continues to show improvement over the same period last year," said IPC President Denny McGuirk. "The book-to-bill ratio is holding steady, although shipments outpaced bookings in April."

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 three months.

Book-to-bill ratios and growth rates for rigid PCBs and flexible circuits combined are heavily affected by the rigid PCB segment. Rigid PCBs represent an estimated 88 percent of the current PCB industry in North America, according to IPC's World PCB Production and Laminate Market Report for the Year 2006.

The Role of Domestic Production
IPC's monthly survey of the North American PCB industry tracks bookings and shipments from U.S. and Canadian facilities, which provide indicators of regional demand. These numbers do not measure U.S. and Canadian PCB production. To track regional production trends, however, IPC asks survey participants for the percent of their reported shipments that were produced domestically (i.e., in the USA or Canada). In April 2008, 87 percent of total PCB shipments reported were domestically produced. Domestic production accounted for 87 percent of rigid PCB and 86 percent of flexible circuit shipments in April by IPC's survey participants. These numbers are significantly affected by the mix of companies in IPC's survey sample, which changed slightly in January but will remain constant through the remainder of the year.

Bare Circuits Versus Assembly
Flexible circuit sales typically include value-added services such as assembly, in addition to the bare flex circuits. In April, the flexible circuit manufacturers in IPC's survey sample indicated that bare circuits accounted for approximately 59 percent of their shipment value reported for the month. Assembly and other services make up a large and growing segment of flexible circuit producers' business. This figure is also sensitive to changes in the survey sample, which may occur at the beginning of each calendar year.

Interpreting the Data
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 may reflect cyclical effects. Because bookings tend to be more volatile than shipments, changes in the book-to-bill ratios from month to month may not be significant unless a trend of three consecutive months or more is apparent. It is also important to consider changes in bookings and shipments to understand what is driving changes in the book-to-bill ratio.

The information in IPC's monthly PCB industry statistics is based on data provided by a representative sample of both rigid and flexible PCB manufacturers in the USA and Canada. IPC publishes the PCB Book-to-Bill Ratio and the Interconnect Manufacturing Services (IMS) Business Report each month. Statistics for the previous month are not available until the last week of the following month.