Advanced Television

Media technology growth stalls, profitability falls

December 8, 2008

After an extended period of strong sales growth and profit performance the IABM Industry Index reveals the first indication of a downturn in the broadcast and media technology sector.

The IABM Index tracks year on year change in overall sales and profitability for the broadcast manufacturing and media technology sector worldwide by examining the latest reported financial data. Companies analysed in this report have sales turnover in the last 12 months of over US$10.3BN. Global sales have increased by 11.9 per cent year on year, but this rate of increase now appears to have peaked. 74 per cent of companies are in profit in the latest results, but the number moving into loss is increasing and the aggregate profit to sales ratio stands at 11.7 per cent and is declining.

Roger Stanwell, IABM Chief Executive Officer, commented, "The cyclical peak rate of sales growth seen in both October 2006 and October 2007 has hardly happened at all this year. There is now an indication of the start of a decline in the long term value of this Index, for both North American and European companies."

Profitability has still improved, but now by only 9.3 per cent year on year, the lowest increase since the Index tracking started three years ago. Profit growth in Europe has in fact turned negative – a 1 per cent decline on the prior 12 month period.

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