Sources: National Precast Concrete Association, Carmel, Ind.; CP staff
After several years of stagnation, the precast concrete industry is turning the corner in recovery from the Great Recession, with NPCA’s 2013 Benchmarking Report indicating 2 percent higher volume in 2012 over the prior year—coupled with a near-doubling of profit margins, from 2.5 percent to 4.9 percent.
“The growth in the precast sector typically trails the rest of the construction industry by about a year,” says NPCA President Ty Gable. “Based on history and anecdotal evidence from the first half of 2013, we are confident the upward trend is continuing. But we’ve still got a long way to go, and we won’t see sales volume that approaches the peak years of 2006 and 2007 any time soon.”
NPCA’s Benchmarking Report is compiled from a voluntary annual survey of North American precast producers. Conducted by Industry Insights, an independent research firm based in Ohio, it includes sales mix data, profit model ratios, and compensation and benefits summaries from participating companies. The 2013 survey reflects results from 75 precast concrete producers operating 181 plants.
Gable said that during the recession, the precast concrete sector lost about 40 percent of its sales volume from a 2007 peak, and is now at a level similar to the industry’s size in 2000. The number of companies has also declined from its peak. NPCA estimates that there are about 2,800 precast concrete companies in North America—about 20 percent fewer than six years ago. “We’re recovering, but still face challenging times,” Gable affirms. “Based on what we’ve seen so far in 2013, we would expect about 4 percent growth this year, so the trend is in the right direction and we see a lot of opportunity ahead in new technologies and emerging markets for precast.”