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PCB | August 09, 2006

IPC release PCB Book-to-Bill Ratio for June

The North American flexible circuit book-to-bill ratio climbed back to the positive range at 1.01, after a three-month dip below parity. These ratios are based on monthly data collected from PCB producers that participate in IPC's monthly PCB Statistical Program.
The combined (rigid and flex) industry book-to-bill ratio in June 2006 was 1.00. Some analysts find the separate ratios for rigid and flex more meaningful than the combined ratio, however, because of the divergence in recent years between the rigid PCB and flexible circuit segments of the industry in growth rates and book-to-bill patterns.

The 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 the companies in IPC's survey sample. A ratio of more than 1.00 suggests that current demand is ahead of supply, which indicates probable near-term growth.

For rigid PCBs and flexible circuits combined, industry shipments in June 2006 increased 11.6 percent from June 2005, and orders booked increased 19.2 percent from June 2005. Year to date, combined industry shipments are up 10.6 percent and bookings are up 12.3 percent. Combined industry shipments for June 2006 are up 8.4 percent over the previous month, and bookings are up 22.6 percent over the previous month.

"Shipments and bookings in both segments of the industry showed healthy growth in June," said IPC President Denny McGuirk. "In the flexible circuit segment, the book-to-bill ratio has returned to the positive range, which suggests a modest upturn. The sluggish results in flex circuit business during the first half of 2006 may be a reflection of the growing competitiveness in this segment. More companies are entering the flex market, in response to its high growth of the past two years," McGuirk concluded.

The book-to-bill ratios and growth rates for rigid PCBs and flexible circuits combined are heavily affected by the rigid PCB segment. Rigid PCBs represents an estimated 85 percent of the current PCB market in North America, according to IPC's World PCB Production and Laminate Market Report for the Year 2005.

Click here to read the full report (www.ipc.org).
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