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J U L Y 2 0 1 4 | 1 9 BY THE NUMBERS BY THE NUMBERS Steve Kline is the director of market intelligence for Gard- ner Business Media Inc. (Cincinnati, Ohio), the parent company and publisher of H i g h - P e r f o r m a n c e Composites. Kline holds a BS in civil e n g i n e e r i n g f ro m Vanderbilt University and an MBA from the University of Cincinnati. I COMPOSITES BUSINESS INDEX 56.8: BEST SINCE FEBRUARY 2012 n April, the U.S. Composites Business Index of 51.8 lengthened its growth string to fve months, but it was also the CBI's lowest showing in 2014. Every subindex contributed to the slower rate: New orders grew for the ffth straight month, but the rate had slowed signifcantly since its January peak. Pro- duction had expanded for four straight months but at its slowest rate in 2014. Backlogs contracted for the frst time this year but were still 6.5 percent higher than they were one year earlier. The ac- celerating annual rate of change in back- logs indicated higher capacity utilization and capital spending for the rest of 2014. Employment increased at a faster rate than at any time since August 2012. Af- ter growing in March, exports contracted signifcantly in April. Supplier deliveries lengthened at a slower rate but contin- ued a trend begun in October 2013. Material prices increased at the March rate. To that point, material prices had increased in 2014 at a signifcantly faster rate than they did in 2013. Prices received increased slightly in April after decreas- ing in March. Future business expecta- tions remained high. A prime source of April's slowdown was the mid-size fabricators category (50 to 249 employees). After growing for some time, it contracted sharply. For fab- ricators with 100 to 249 employees, the overall index fell nearly 20 points. The largest fabricators saw their growth rate dip somewhat. But this was counterbal- anced by faster growth at plants with 20 to 49 employees. Those with fewer than 20 contracted at the March rate. Four of the fve U.S. regions grew in April. The North Central – East grew at the fastest rate for the second month in a row. The Northeast, Southeast and West followed, the latter growing for the ninth month in the past 10. The lone region to contract was the North Central – West. Compared to one year earlier, April's future capital spending plans subindex was up 9.1 percent. The May CBI of 56.8 showed that the composites industry grew for the sixth straight month, and at its fastest rate since February 2012. Compared to one year earlier, the index was up 13.6 percent. This was the fastest rate of month-over- month growth since December 2013. In a reversal of April, every May subin- dex contributed to the faster growth rate. The new orders rate jumped dramatically, reaching its third highest level since the CBI began in December 2011. Production and backlogs continued to expand, the lat- ter at it fastest rate since March 2012 and 18.5 percent higher than one year earlier. The annual rate of change in backlogs con- tinued to accelerate, indicating higher ca- pacity utilization and capital spending for the rest of 2014. Employment expanded at its second fastest rate since the Index began. Exports contracted for the second straight month. Supplier deliveries contin- ued to lengthen at a slightly faster rate. Material prices increased at their fast- est rate since February 2013. The rate was noticeably faster than the previous two months. Prices received had increased fve of the past six months. Future busi- ness expectations improved in May and remained at a historically high level. Most fabricators saw improved busi- ness conditions — most dramatically in shops with 19 or fewer employees. At 58.6, their subindex grew at its fastest rate since the Index began. After con- tracting in April, facilities with 50 to 99 employees expanded slightly in May. The largest facilities (250+ employees) grew at the second fastest rate since July 2012. Regionally, the West grew faster than any region since the index began, fol- lowed by the Northeast, which had grown for six straight months. The Southeast, North Central – West and North Central – East expanded; the latter continuing a strong three months of steady growth. Compared to one year ago, May's fu- ture capital spending plans were up 14.9 percent, while the annual rate of change had grown at a relatively constant rate the past four months. THE COMPOSITES BUSINESS INDEX Subindices May April Change Direction Rate Trend New Orders 63.5 54.0 9.2 Growing Faster 6 Production 61.2 57.1 4.1 Growing Faster 5 Backlogs 53.1 47.2 5.9 Growing From Contracting 1 Employment 59.8 53.7 6.1 Growing Faster 15 Exports 49.6 45.1 4.5 Contracting Slower 2 Supplier Deliveries 54.0 53.8 0.2 Lengthening More 30 Material Prices 68.7 64.2 4.5 Increasing More 30 Prices Received 53.5 51.2 2.3 Increasing More 2 Future Business Expectations 76.4 73.8 2.6 Improving More 30 Composites Business Index 56.3 51.8 5.0 Growing Faster 6 0714HPC By the Numbers-OK.indd 19 6/17/2014 10:21:41 AM