BPIF Report Says Industry Direction On Up

Margins in the printing industry have improved for the first time since January 2000, but the Christmas 2003 season accentuated the polarisation in business performance within the printing sector, sai

Margins in the printing industry have improved for the first time since January 2000, but the Christmas 2003 season accentuated the polarisation in business performance within the printing sector, said to the British Printing Industries Federation (BPIF).

The same proportion of companies reported better than normal order books (39%) as those that reported poorer orders according to the latest 'Directions', the BPIF's quarterly survey of trends in the UK printing industry.

"It's too early to tell if this will be a sustainable recovery, however it has to start somewhere, and hopefully this is it," said director of corporate affairs Cicely Brown.

The special report on general and promotional print could be buoyed by recent press reports that predicted an upturn in the advertising market for 2004.

However on the whole the survey generally mirrored views of the CBI, which had welcomed the Government's monetary policy committee's 'gradualist' approach to interest rates.

'Directions' indicated that prices on the whole though have not risen, with volatility and unpredictability discouraging companies from discarding less profitable customers, whose work may be needed in coming months.

The improvement in margins resulted largely from cost containment and, although the net balance of +41 for the general state of the trade is the best since January 2000, it compares unfavourably to a prediction of +58.

Other indices that recovered for the first time in three years included expected capital expenditure and a positive balance for employment.

Although there is still over-capacity in the industry, with 59% of companies working under their production capacities compared to last quarter's low of 55%, some may have welcomed renewed investment as signs of recovery although the 'Drupa effect' should not be discounted.

Additionally there is a small positive balance on employment for the previous three months.

However, it has been offset by large redundancy programmes emphasising the focus on cost containment.

Professor Frank Burchill, chairman of the BPIF and GPMU partnership at work joint review body said in the survey: "It's refreshing to be involved in an exercise of this kind that has not been precipitated by an industrial dispute but by genuine concern on both sides of the industry to address the challenges faced.".

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