German printing and media industry sentiment has improved

According to the BVDM Business Telegraph, the business environment of the German printing and media industry fell to its lowest point in 10 years in April this year due to the corona virus pandemic. The index recovered some lost ground in May. Compared to the previous month, the hope that the economy will soon return to normal has led to more optimistic expectations. In May, the business prosperity index of the printing and media industry increased by 3.5% month-on-month to 84.1 points, but compared with the same period in 2019, the index fell by 13.6 points.

However, the printing and media companies surveyed by the German Economic Research Institute in May believed that the business conditions index in May fell again by 6.5% month-on-month, so the business conditions in May were much weaker than in April. This is the largest year-on-year decline since January 1991. This means that the initial measures taken in May to alleviate the corona virus blockade had little impact on sluggish demand and order trends. About 62% of the interviewed companies indicated that their current order backlog is too small, and only 1% of respondents indicated that their order backlog is relatively large. Compared with April 2019, this figure has a net decline rate of about 24 percentage points. Therefore, 53% of the respondents think that their current profitability is very poor, so it is not surprising that 10% of people think that the profitability is good.

The business environment rebounded slightly from last month, mainly due to the obvious optimism of printing press media companies' expectations for the future business situation. The improvement in the business expectation index seems to be largely due to increasing market hopes that the economy will soon recover after exposure to some regulatory measures. Compared with April, the index rose by 14.6% adjusted to seasonal factors to 93.6%, only 3.7% lower than the same period last year. About 24% of the respondents expect business development to be more favorable in the next 6 months, and about 42% of the interviewed companies believe that their business conditions may deteriorate in the future. Compared with a year ago, the net number dropped by about 7 percentage points.