Tewkesbury, 2nd July 2009: Suppliers of broadcast and media technology products and services are now feeling the full impact of the global economic downturn, according to the latest Industry Index (www.theiabm.org/index) from the International Association of Broadcasting Manufacturers (IABM). The index tracks the state of the industry through an analysis of published financial statements from a basket of small, medium and large companies.

Global sales increased by 7.9% year on year, a sharp decline from the 11.7% reported three months ago. This drop is largely due to poor first quarter performance this year, with sales turnover typically down by 25% on the same quarter in 2008. 71% of the companies reporting remain in profit but overall profitability is declining, with the IABM profit growth index turning negative for the first time since tracking began three years ago.

“These are naturally disappointing figures,” said Roger Crumpton, director of IABM, adding “but they are not unexpected. As well as the downturn which is affecting everyone, the broadcast industry was set to see a sharp drop in sales in this period. 2008 was bound to be a good year for business, with major television events like the Olympics and the US presidential elections causing a lot of people to re-equip. Those budgets have been spent, so 2009 will inevitably be a lean year.

“There is good news too,” Crumpton continued. “The profit to sales ratio remains good at around 11.5% globally, with larger companies maintaining strong performance. Those companies with products in emerging technologies like video over IP and digital cinema are the best performers at present.”

The figures in the Industry Index reinforce the IABM Industry Trends Survey, published in June in association with Ernst & Young. This suggests a cautious near-term outlook, but a degree of optimism about the longer term. Operations have generally now been streamlined to minimise the impact of reduced revenues, leading, it is hoped to a strong future as business picks up in the coming quarters.