Construction product sales have again risen during the third quarter despite recent financial upheaval, according to the latest Ernst and Young/Construction Products Association Activity Barometer.

The third quarter of 2007 records a score of 73 compared to the record high of 80 in the second quarter. Overall product sales are set to rise further during the fourth quarter, although the pace of growth is expected to moderate. The survey recorded a score of 66 for construction product sales during the next three months, firmly above the 50 'no change' mark.


Commenting on the results, Maren Baldauf, Economist for the Construction Products Association said: "The Barometer findings indicate that the construction industry remains buoyant, with both heavy and light side firms seeing sales volumes ahead of a year ago. However, year-on-year sales growth is set to moderate during the fourth quarter. Whilst this partly due to the strong finish to last year, it is also reflects greater industry caution in light of the current turmoil in financial markets."

Dominic McAra, a Director in Ernst & Young’s Building Products team commented: "The impact of the credit crunch is evident across a number of market sectors so a level of caution in this sector is understandable. The fact that the crunch has not hit current sales is encouraging however.

"It will be interesting to see whether the crunch impacts M&A in the sector, or whether those consolidators with funds in place are able to continue with their activities. A number of the energy efficient products may still be sufficiently attractive to continue to attract investment."

(CL)