Report: Printed circuit board book-to-bill weakness signs to increase

October 28, 2008

Investment bank J.P.Morgan writes in a recent report the 3-month rolling rigid printed circuit board book-to-bill increased slightly month/month to 0.96x in September from 0.95x in August while the flexible PCB book-to-bill also improved to 0.94x from 0.90x.

The firm's derived one-month rigid book-to-bill actually increased 6% month/month to 0.99x from 0.93x in August as a result of bookings index growing faster month/month than shipments.

While year-to-date shipments increased 4.2%, bookings were down 0.8%. J.P.Morgan's report points to concern about slowing demand (particularly in enterprise computing and communications in the bank's opinion), which the bank believes will continue to pressure North American printed circuit board manufactures over the next few quarters.

Meanwhile, the rigid printed circuit board book-to-bill is up slightly. The 3-month rigid book-to-bill for September was 0.96x, up slightly month/month from 0.95x, compared to the historical sequential decline of 0.2%.

On a year/year basis, rigid printed circuit board shipments were down 3.8% and bookings were down 16.4%. Compared to August, rigid printed circuit board shipments increased 4.5% and bookings were up 11%.

One-month book-to-bill now approaching parity

The firm's derived one-month (vs. the published 3-month rolling average) book-to-bill was up 6.3% to 0.99x from 0.93x in August, compared to the historical sequential decrease of 6.2%. On an month/month basis, September's one-month booking index was up 14.7% (compared to the historical increase of 5.5%) and the shipment index was up 7.9% (compared to the historical increase of 12.3%).

Source: J.P.Morgan