The Construction Products Association’s (CPA) latest State of Trade Survey for the first quarter of 2015 indicates an eighth consecutive quarter of increasing sales for construction product manufacturers.
Further growth is anticipated during the second quarter and over the next 12 months, supported by domestic demand, exports and a reduction in fuel and energy costs.
Key points included:
- 50% of heavy-side and 29% of light-side firms reported that sales rose during the first quarter of 2015, compared with a year earlier;
- 69% of heavy-side and 57% of light-side product manufacturers reported that they anticipated sales rising over the coming year;
- exports decreased for 25% of heavy-side and 14% of light-side firms;
- 29% of heavy-side and 20% of light-side businesses anticipated a rise in exports over the next year;
- fuel costs fell for 86% of heavy-side and 83% of light-side companies, to the lowest balance recorded in the four years of the survey; and
- 77% of heavy-side and 64% of light-side firms anticipated increasing investment in research and development (R&D) over the next 12 months.
CPA economist Rebecca Larkin said: “A rise in first quarter sales was reported by 50% of heavy-side firms and 29% of light-side firms, compared with the same quarter a year earlier. Some weakness in external demand was noted, as the strong Sterling hindered exports to the eurozone.
“Nevertheless, further growth in sales is anticipated over the next 12 months by 69% of heavy-side firms and 57% of those on the light side, underpinned by demand at home and abroad.”
She said product manufacturers appeared keen to capitalise on this sustained period of activity and to shore up demand in the longer term.
Priority areas for investment over the next 12 months, cited by more than two-thirds of businesses surveyed, were product improvement, research and development and e-business.