Ancillary component sales surge 'not sustainable' say AFDEC - Embedded.com

Ancillary component sales surge ‘not sustainable’ say AFDEC

LONDON — Members’ overall average daily bookings and billings of component sales improved in December 2006 according to the U.K.'s Association of Franchised Distributors of Electronic Components (AFDEC) and one sector grew by over 30 percent.

AFDEC chairman Adam Fletcher sited a strong performance in the semiconductor sector and 'significant customer activity' in the other products sector as the principal growth drivers. “We experienced a welcome but wholly untypical surge of business in one particular area of the other products sector but it’s not sustainable and I fully expect the sector to resume its normal trend in the future”. 

Average daily bookings (net sales orders entered) in December 2006 increased by 3.1 percent when compared to November 2006 and increased by 12.1 percent when compared to the same month in the previous year. Sector specific bookings changes compared to November 2006 were: semiconductor increased by 11.4 percent, passives declined by 9.1 percent, electro-mechanicals declined by 12.4 percent, component assemblies declined by 8.1 percent, with other products increased by 32.3 percent. 

Total average daily billings (net sales invoiced less credits) in December 2006 increased by 9.8 percent, when compared to November 2006 and increased by 17.3 percent when compared to the same period 2005. Semiconductors, component assemblies and other products had double digit growth while passives and electro-mechanicals showed single digit declines.

The overall book-to-bill ratio in December declined to 0.94:1 with the overall stock turn ratio declining slightly to 2.1 times, however the inventory total decreased by a further 4.6 percent and debtor days declined slightly to 65 days when compared to the previous month. 

AFDEC’s initial analysis of the overall results for Distribution in 2006 reveals a healthy book-to-bill ratio of 1.03:1 and an overall distributors total available market (DTAM) growth of 4.4 percent, accurately reflecting the association’s forecast for 2006forecast for 2006. AFDEC will release a detailed fourth quarter 2006 commentary in the next couple of weeks.

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