"An improved billings performance in June is good news,” said ECSN chairman Adam Fletcher. "But the figures are flattered somewhat by poor May results and the fact that our members benefited from three additional working days in June.”
Additionally, bookings in June increasing by 11% compared to the previous month and by 6% on the same period last year. The sales by month – three month moving average – for all electronic components suggests slight growth into July 2016, which according to Fletcher, is ‘much in-line with historical trends’.
According to Fletcher, the increase in sales in June has been driven primarily by the semiconductor market, which he says is generally a leading indicator. "But the UK remains at odds with the global market where overall semiconductor demand is at best static or even slightly declining," he added.
Meanwhile, ECSN is concerned about the collapse in the Book-to-Bill (B2B) ratio, which the association views as a key indicator of the health of the UK component market. In June 2016, the B2B ratio declined by 16 points compared to the previous month. According to Fletcher, while customers appear to be consuming more products, they are not maintaining their inventory. Despite this, Fletcher believes that the B2B ratio is likely to continue as positive.
“We remain in a period of some uncertainty," concluded Fletcher. "Although equity, currency, commodity and bond rates have stabilised post Brexit, we'll just have to wait and see what the next quarter brings.”
