Instrumentation industry continues upward trend

“At present, for the instrumentation industry, whether it is the value of domestic sales or the growth of profits are all relatively optimistic, the entire industry continues to maintain a slow upward trend remains unchanged.” Recently, Ruan Jiacheng, chairman of the China Instrument and Meter Industry Association, accepted the report. Said during the interview.

Industry production and sales rebounded, stable profits rebounded

According to the latest data, from January to August this year, the growth rate of the production and sales of the instrumentation industry remained at around 17%, and the recovery of the industry's production and sales began to stabilize, which was slightly higher than expected at the beginning of the year.

"According to past experience, the value of production and sales of the instrumentation industry in June is often the highest in a year, and it will decline in July and August. By September, the industry's operating conditions will begin to pick up," said Yan Jiacheng.

Statistics from the instrumentation industry indicate that in the first half of 2012, the total industrial output value of the instrumentation industry in China was 315 billion yuan, up 17% year-on-year; the industrial sales value was 304.9 billion yuan, up 16.8% year-on-year; of which the export delivery value was 10.38 billion yuan. The US dollar increased by 19.6% year-on-year, and the import value was US$18 billion, a year-on-year increase of 4.37%.

“The instrumentation industry has maintained an industry growth rate of over 17% for five consecutive months.” When analyzing the reasons for the rapid rise in production and sales, Yu Jiacheng stated that, first of all, industry growth has been due to the growth of the automation instrument industry. At the beginning of the year, due to the impact of the “three-high” industry, the automation instrument industry experienced a sharp decline in industry growth. The growth rate of the industry’s production and sales dropped from 30% to about 9%. At present, it has recovered to 13%.

Secondly, due to the strong demand for scientific research and test equipment from scientific and technological innovation, the increase in analysis, testing, and other scientific instrument industries has reached 20%, which is one of the important reasons for the increase in the growth of production and sales in the instrumentation industry.

When talking about the profit level of the instrumentation industry, Jia Jiacheng stated that “at present, the recovery of the profit index of the whole industry is gradually accelerating, but there is still a certain gap from the level predicted at the beginning of the year.”

The data shows that at the beginning of 2012, the industry’s profit growth rate was -14%, the lowest point of the century, and it has already recovered to 10.3% in July, but there is still a certain gap from the level of profit growth expected to reach 13% at the beginning of the year.

In addition, the profit rate of main business income in the instrumentation industry has reached 8%, which is in line with the high profit rate of the general high-tech industry. "The industry's main business income has the highest profit margin of 9%. It is expected that it will remain around 8.5% at the end of 2012," said Yan Jiacheng.

When analyzing the reasons for the rapid rise in profits, Jia Jiacheng stated that “the sharp drop in the industry’s profit margin at the beginning of the year was caused by the fluctuations in the financial industry, not the industry’s own profitability problems”. At the beginning of this year, due to monetary tightening, the company’s recovery of payment was difficult. As a result, accounts receivable increased and profitability fell.

As the cost of raw materials, components, etc. has dropped steadily, the rising trend in labor costs has stabilized, coupled with the gradual implementation of fiscal input such as the national restructuring and steady growth, which has caused the industry's demand to increase slowly. This is the reason why the profits of the industry have picked up.

Affected by the weak economy, from the beginning of this year, the import of the whole industry showed a low growth trend. From January to April, the import growth has been kept below 3%. In July, this figure reached 6.42%, which was the first time this year exceeded 5 %s level. “A slight rebound in the growth of imports has a lot to do with the slowdown in the economic situation,” said Jia Jiacheng.

Due to the large number of low-grade products in the industry, the rigid demand in overseas markets accounts for a large proportion, plus the cost-effectiveness and comprehensive competitiveness of China's instrumentation products still have advantages, and the export situation of the industry is better than imports. From January to August, the export growth rate still maintained double-digit growth, reaching 19%. Among the exporting countries, developing countries account for a relatively large proportion. At the same time, exports of medium and high-end products such as DCS and rail transit monitoring systems have increased.

Distinct operating characteristics of the industry

In summing up the characteristics of the economic operation of the instrumentation industry in the first half of this year, Yan Jiacheng stated that from the perspective of the industry, there have been major changes in the first half of this year and in previous years. First, at present, although scientific instruments such as analysis and testing still maintain an increase of more than 20%, the pattern in which medium-to-high-end instruments rely mainly on imports remains unchanged; in the entire industry, they account for a large proportion, but involve meteorological, oceanographic and geological exploration. Special instruments such as agriculture, forestry, animal husbandry and fishery, culture, education, and medical care have grown rapidly.

Second, under the gradual deepening of the economic structure adjustment, the overall operating status of the industry is tight, and the situation of the enterprises is clearly differentiated. It is understood that the current industry production and sales are in good condition. Enterprises with an increase rate of more than 20% account for about 10% to 15% of the total industry; enterprises with a slight increase account for about 50%; enterprises that are still in a negative growth area account for about 1/3. . In Jia Jiacheng’s view, with the continuous deepening of the country’s “steady growth” measures, it is expected that the proportion of Class I and II enterprises will gradually increase.

Thirdly, companies that have performed well this year are generally those with high technological content, good industrialization results, and little capacity expansion. Their common feature is that, despite the macroeconomic situation, total product demand has not significantly increased, but due to its competitive advantage, the market share of these companies has been rising.

Fourth, many companies have taken measures to expand exports to compensate for declining domestic demand this year. For example, in the meter industry, 14.54 million units were exported from January to June this year, and the export value reached 295 million US dollars, an increase of 43.7 percent over the same period of last year. %, the annual export volume is expected to reach more than 25 million units, and the export value will exceed 500 million US dollars for the first time.

Fifth, the development of "three foreign-funded" enterprises has continued to slump. From January to June, the growth rate of production and sales of “funded enterprises” was 5.23% and 4.65%, respectively, which was 12 percentage points lower than the increase of the entire industry. The profit growth was negative to this day. Among them, loss-making enterprises exceed 30% of the total number of foreign-funded enterprises. At present, the operating status of “three foreign-funded” enterprises has become an important reason why the growth rate of the entire industry is difficult to recover to 20%.

Future outlook

Looking into the operational situation of the instrumentation industry this year, Yan Jiacheng stated that if there are no major sudden fluctuations in the macroeconomic environment, the major economic indicators for the instrumentation industry this year can reach the target set at the beginning of the year: “The growth in production and sales can reach 15% year-on-year, and the profits are The growth rate is lower than expected and will reach 13%; the year-on-year increase in imports will maintain a one-digit low growth, at about 5%; the year-on-year increase in exports will still reach double-digit growth, at about 18%; the import and export deficit will remain huge, reaching 150 It was more than US$100 million, but it was slightly lower than the 17.2 billion US dollars of the previous year.”