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INDUSTRY PERFORMANCE MEASURES

A range of performance measures, mainly expressed as ratios, can be produced from the data available from businesses' financial statements. A selection of these are presented in table 2.7 for each manufacturing industry subdivision. Definitions are provided in the Glossary. Information about the uses and limitations of these measures can be found in Explanatory Notes paragraphs 22-28.

The following summarises the manufacturing industry's performance ratios for 2005-06, as set out in detail in table 2.7:

• The profit margin for total manufacturing in 2005-06 is estimated at 7.9%, a decrease from 8.4% in 2004-05. At the industry subdivision level, profit margins ranged from 14.6% for the Printing, publishing and recorded media industry to 5.9% for Machinery and equipment manufacturing. Estimated profit margin declined in seven subdivisions. Increases occurred in Petroleum, coal, chemical and associated manufacturing (from 6.0% to 6.9%) and in Other manufacturing (from 7.9% to 8.2%).

• Interest coverage for total manufacturing declined in 2005-06 to 7.4 times, down from 8.1 times in 2004-05. Interest coverage decreased in four of the nine manufacturing subdivisions. The industries which improved their interest coverage were Other manufacturing (from 9.5 times to 10.3 times), Printing, publishing and recorded media (7.4 times to 7.5 times), Petroleum, coal, chemical and associated product manufacturing (6.8 times to 7.2 times), Non-metallic mineral product manufacturing (6.1 times to 6.2 times) and Textile, clothing, footwear and leather manufacturing (4.4 times to 5.5 times).

• In one manufacturing industry subdivision, Petroleum, coal, chemical and associated product manufacturing, IVA was double the estimate of its selected labour costs. For manufacturing overall, the ratio was 1.8 times, the same as in 2004-05. Machinery and equipment manufacturing (at 1.48 times) shows the lowest value for this ratio.

• Selected labour costs per person employed ranged from $65,300 in Petroleum, coal, chemical and associated product manufacturing to $37,100 in Textile, clothing, footwear and leather manufacturing. For total manufacturing, the estimate rose by 5% (from $51,500 to $53,900) in 2005-06.

• The manufacturing industry's investment rate (value added) in 2005-06 was 19.3%, compared to 16.9% in 2004-05. This reflected, in 2005-06, a range from 10.9% for Other manufacturing to 29.5% for Metal product manufacturing.