Jun 12, 2012
Second-quarter building confidence fallsBack
First National Bank|Building|Cees Bruggemans
© Reuse this
However, despite the fall in confidence, with 7 out of 10 respondents in different sectors of the building industry rating the prevailing business conditions as unsatisfactory, the index remained higher than that recorded for most of 2011.
The FNB/BER business confidence index results found that despite steady performance in the building sector during the second quarter of the year, the industry held no improvements as was anticipated – highlighting the slow, somewhat hesitant nature of the building sector recovery.
“The underlying data on activity and profitability does not suggest that the recovery has stalled, rather that the pace of the recovery remains very slow,” said FNB economist Cees Bruggemans.
Further, he added that increased domestic and global uncertainty may have dampened confidence and contributed to the divergence between confidence and activity.
Nonresidential contractors recorded the largest shift in confidence with a decrease from 38 index points to 19 during the second quarter, while the confidence of residential contractors remained largely flat, decreasing by 2 index points, from 28 to 26.
Bruggemans pointed out that the nonresidential sector continued to outperform the residential sector with no indication of a slowdown in the sector.
The business confidence of main contractors fell 7 index points to 24 points, while subcontractor confidence rose from 29 to 32 index points. Business confidence among architects and subcontractors rose by 13 and 3 index points, respectively.
The index reported another significant drop in confidence from building material and hardware retailers, with -29 index points, followed by manufacturers at -17, main contractors at -7 and quantity surveyors at -5.
“Despite the 7 index point decline in building confidence, the underlying information about activity and profitability suggests that the recovery is still on track, but, at a very sluggish pace, perhaps even slower than previously thought,” said Bruggemans.
Edited by: Mariaan Webb© Reuse this Comment Guidelines (150 word limit)
Other Construction Materials News
Updated 1 hour 5 minutes ago Sephaku Holdings, which is in the process of finalising its interim results for the six months ended September 30, expects to swing to a basic loss a share of between 1.9c and 2c for the half-year, from basic earnings a share of 3.32c in the first half of the prior...
A well-documented challenge facing the construction industry is the across the board skills shortage, which has the potential to seriously affect the sustainability of the sector. “Within construction people are our greatest assets and the Stefanutti Stocks group is...
Updated 12 minutes ago Sasol announced on Thursday that its broad-based black economic empowerment (BBBEE) transaction, Sasol Inzalo, has been partially refinanced, making a significant contribution to reducing its financing costs. The refinancing would see shareholders of Sasol Inzalo...
Updated 21 minutes ago International packaging and paper group Mondi has attracted a long-term credit-rating upgrade from Moody’s Investors Service. In a statement to shareholders on Thursday, the dual-listed group announced the credit rating hike from Baa3 to Baa2.
Updated 56 minutes ago Sephaku Holdings, which is in the process of finalising its interim results for the six months ended September 30, expects to swing to a basic loss a share of between 1.9c and 2c for the half-year, from basic earnings a share of 3.32c in the first half of the prior...
Recent Research Reports
Defence 2014: A review of South Africa's defence industry (PDF Report)
Creamer Media’s Defence 2014 report examines South Africa’s defence industry, with particular focus on the key participants in the sector, the innovations that have come out of the sector, local and export demand, South Africa’s controversial multibillion-rand...
Road and Rail 2014: A review of South Africa's road and rail infrastructure (PDF report)
Creamer Media’s Road and Rail 2014 report examines South Africa’s road and rail transport system, with particular focus on the size and state of the country’s road and rail network, the funding and maintenance of these respective networks, and the push to move road...
Real Economy Year Book 2014 (PDF Report)
This edition drills down into the performance and outlook for a variety of sectors, including automotive, construction, electricity, transport, steel, water, coal, gold, iron-ore and platinum.
Real Economy Insight: Automotive 2014 (PDF Report)
This four-page brief covers key developments in the automotive industry over the past 12 months, including an overview of South Africa’s automotive market, trade figures, production and the policies influencing the sector.
Real Economy Insight: Construction 2014 (PDF Report)
This five-page brief covers key developments in the construction industry over the past 12 months. It provides an overview of the sector and includes details of employment in the sector, infrastructure and municipal spending, as well as insight into companies’...
Real Economy Insight: Electricity 2014 (PDF Report)
This five-page brief covers key developments in the electricity industry over the past 12 months, including details of State-owned power utility Eskom’s generation activities, funding and tariffs, independent power producers and prospects for the sector.
This Week's Magazine
Integrated energy and chemical company Sasol has partnered with Unisa Graduate School of Business Leadership (SBL) professor and founder and CEO of PanAvest Partnership Dr Douglas Boateng to publish a series of books on executive supply chain management aimed at...
The World Wide Fund for Nature’s (WWF’s) 2014 Living Planet Index (LPI) indicates that there has been a 52% decline in vertebrate species since 1970. The Index tracked the trends of 10 000 discrete populations of over 3000 vertebrate species between 1970 and 2010.
Rwanda has joined a number of East African countries seeking to import electricity from Ethiopia as its demand grows. After it became apparent several generation project it is implementing will not come on stream early enough, now plans to import 400 MW from Ethiopia...
Metrorail’s first new passenger train will arrive in November next year, says Passenger Rail Agency of South Africa (PRASA) CEO Lucky Montana. “Next year we will be able to put our hands around the infrastructure and equipment we have been talking about for so long.”
The Competition Commission has launched an investigation into what it says are “price fixing, market division and collusive tendering in the market for the manufacture and supply of automotive components to original equipment manufacturers” (OEMs, or vehicle...