MARCH KEY FIGURES
 | | Mar Qtr 07 | Dec Qtr 06 to Mar Qtr 07 | Mar Qtr 06 to Mar Qtr 07 |
| | $m | % change | % change |
|
| Trend estimates(a) | | | |
| Total new capital expenditure | np | np | np |
| Buildings & structures | np | np | np |
| Equipment, plant & machinery | np | np | np |
| Seasonally adjusted(a) | | | |
| Total new capital expenditure | 19 492 | 9.1 | 4.7 |
| Buildings & structures | 8 035 | 17.2 | 15.0 |
| Equipment, plant & machinery | 11 568 | 6.1 | -1.1 |
|
| np not available for publication but included in totals where applicable, unless otherwise indicated |
| (a) In volume terms. |
New Capital Expenditure, in volume terms
| |
MARCH KEY POINTS
ACTUAL EXPENDITURE (VOLUME TERMS)
- The seasonally adjusted estimate for total new capital expenditure (in volume terms) increased by 9.1% in the March quarter 2007. March quarter movements have been affected by the privatisation of Telstra.
- Seasonally adjusted estimates for equipment, plant and machinery increased 6.1% in the March quarter 2007.
- The seasonally adjusted estimate for buildings and structures increased 17.2% this quarter.
- There is a trend break in the March quarter 2007 for the total new capital expenditure, equipment, plant and machinery, buildings and structures and Other selected industries series. As a result no trend estimates are published for these series.
EXPECTED EXPENDITURE (CURRENT TERMS)
- This issue includes the sixth estimate for 2006-07 and the second estimate for 2007-08. These estimates have also been affected by the privatisation of Telstra.
- The sixth estimate for 2006-07 is $78,062m, which is 9.3% higher than the corresponding estimate for 2005-06 and 5.6% higher than the fifth estimate for 2006-07.
- The second estimate for 2007-08 is $70,029m. This is 21.7% higher than the second estimate for 2006-07. Estimate 2 is 10.2% higher than the first estimate for 2007-08
NOTES
FORTHCOMING ISSUES
| ISSUE (QUARTER) | Release Date |
| June 2007 | 30 August 2007 |
| September 2007 | 29 November 2007 |
CHANGES IN THIS ISSUE
Telstra Corporation was effectively privatised on 20 November 2006. For the purposes of ABS statistics this change from public sector to private sector is effective from March quarter 2007. This change has impacted on the data series presented in this publication, particularly the March quarter 2007 movements. For more information please see Information Paper: Future Treatment of Telstra in ABS Statistics, 2007 (cat. no. 8102.0), released 26 February 2007.
To assist users of these statistics the seasonally adjusted movements for March quarter 2007 if Telstra Corporation had also been included in the December quarter 2006 data would have been as follows:
Total new capital expenditure 4.7%
Buildings and structures 10.1%
Equipment, plant and machinery 2.6%
Telstra Corporation have also been included in expectations estimates for the first time in the March quarter 2007. They contribute to the sixth estimate for 2006-07 and the second estimate for 2007-08. Caution should be taken in the application of realisation ratios where this has an impact.
REVISIONS IN THIS ISSUE
The December quarter 2006 Transport industry estimate has been revised downwards by $298m in original terms. This has had the effect of reducing the industry total by 16.4%. The majority of this revision was due to the discovery of an incorrectly reporting unit.
FORTHCOMING CHANGES
A new reference year is typically updated annually every June quarter. From 2007 onwards the updating of the reference year will be completed in the September quarter each year. In September 2007 the new reference year will be 2005-06 for chain volume estimates. This will result in revisions to growth rates in quarters following 2005-06 but will preserve additivity in those quarters. For earlier periods re-referencing affects the levels of, but not the movements in, chain volume estimates.
INQUIRIES
For further information about these and related statistics, contact the National Information and Referral Service on 1300 135 070 or Scott Johnston on Sydney (02) 9268 4357.
SUMMARY COMMENTARY
TOTAL CAPITAL EXPENDITURE
The seasonally adjusted series for total new capital expenditure rose by 9.1% in the March quarter 2007. Both asset classes have increased with buildings and structures rising by 17.2% and equipment, plant and machinery by 6.1%. There is a break in the trend series in the March quarter 2007 for total new capital expenditure.
BUILDINGS AND STRUCTURES
The seasonally adjusted estimate for buildings and structures rose by 17.2% in the March quarter 2007. Other selected industries rose by 35.3% and Mining by 12.8%. Manufacturing fell by 13.3%. There is a break in the trend series in March quarter 2007 for buildings and structures.
EQUIPMENT, PLANT AND MACHINERY
The seasonally adjusted series for equipment, plant and machinery has risen by 6.1% this quarter. Other selected industries increased by 12.3% in the March quarter 2007 while Mining (-3.0%) and Manufacturing (-7.3%) recorded falls. There is a break in the trend series for equipment, plant and machinery in March quarter 2007.
MINING
The trend estimate for Mining has risen 3.2% this quarter following the small 0.3% rise in the December quarter 2006. This has been driven by equipment, plant and machinery. In seasonally adjusted terms the series rose by 7.9%. This was led by the building and structures asset class. Equipment, plant and machinery fell during this period after a large rise in the December quarter 2006.
MANUFACTURING
The Manufacturing trend estimate fell by 3.9% in the March quarter 2007 which is the fifth consecutive fall. The decline was felt across both asset classes. In seasonally adjusted terms, the estimate fell by 9.0%, which is the sixth consecutive fall. Both building and structures and equipment, plant and machinery fell from the December quarter 2006.
OTHER SELECTED INDUSTRIES
The seasonally adjusted estimate for Other selected industries has increased by 16.2% in the March quarter 2007. There is a break in the trend series for Other selected industries in March quarter 2007.
FINANCIAL YEARS AT CURRENT PRICES
The graphs below show the seven estimates of actual and expected expenditure for each financial year. Advice about the application of realisation ratios to these estimates is in paragraphs 24 to 27 of the Explanatory Notes.
The timing and construction of these estimates are as follows:
TOTAL CAPITAL EXPENDITURE
The sixth estimate for 2006-07 of $78,062m is 9.3% higher than the corresponding estimate in the previous year. This growth is due to the contribution of the building and structures asset class which rose 27.4%. Other selected industries and Mining showed strong gains between these estimates. Estimate 6 is also 5.6% higher than Estimate 5 for 2006-07 with equipment (6.6%) showing the greater rise in expectations.
The second estimate for 2007-08 of $70,029m is 21.7% higher than the corresponding estimate for the previous year. This movement was driven by a 52.3% rise in the building and structures asset class. Mining and Other selected industries had strong increases between these two estimates. The second estimate for total capital expenditure has increased by 10.2% from the first estimate. This strength comes through both asset classes and across most industries.
BUILDING AND STRUCTURES
The sixth estimate has risen 27.4% from the same estimate in 2005-06. This has been driven by large increases in Mining and Other selected industries while Manufacturing fell 17.4%. Estimate 6 has also risen by 4.4% from Estimate 5 led by Manufacturing rising 11.8% and Other selected industries 12.4%.
There has been a 52.3% rise in the second estimate for 2007-08 when compared to the corresponding estimate in 2006-07. Much of this increase has been as a result of the growth in Mining expectations (75.0%). Estimate 2 has risen by 10.9% when compared to Estimate 1.
EQUIPMENT, PLANT AND MACHINERY
Estimate 6 has fallen by 2.5% from the previous financial year which was a historical high for Estimate 6. There was minimal movement across industries with the largest contribution coming from Manufacturing (-10.9%). In comparison to Estimate 5 there has been an increase of 6.6%.
Estimate 2 is 1.3% lower in 2007-08 than it was for the previous year. Mining rose 13.2% moving against the movement seen in the remaining industries. Estimate 2 is 9.3% higher than Estimate 1. Manufacturing, Mining and Other selected industries all showed moderate gains.
MINING
The Mining expectations estimates for 2006-07 have recorded historical highs in recent quarters and this strength has continued into the March quarter.
Estimate 6 is 31.4% higher than the corresponding estimate in 2005-06. Building has had growth of 46.8% while there has been minimal change in equipment between the two estimates. Estimate 6 is 2.9% lower than Estimate 5. This decline was seen in both asset types with building 2.8% lower and equipment 3.3% lower.
Estimate 2 is 57.3% higher than Estimate 2 of the previous year driven by the building and structures asset class which has risen 75.0%. Estimate 2 has shown a small rise of 0.8% when compared to Estimate 1.
MANUFACTURING
Manufacturing expectations, while still at historically low levels, have shown signs of recovery in the March quarter.
Estimate 6 is 13.0% lower in 2006-07 than it was in 2005-06. This decline has been seen in both equipment (-10.9%) and in buildings and structures (-17.4%). Estimate 6 has risen by 4.3% from Estimate 5. The growth has resulted primarily from building which is 11.8% higher this quarter while equipment has shown a moderate increase of 1.3%.
Estimate 2 is 8.7% lower than the corresponding estimate in 2006-07. This has been seen across both asset types. Estimate 2 is 10.3% higher than the low Estimate 1 published last quarter. Equipment has risen 10.9% and building has risen 8.7%.
OTHER SELECTED INDUSTRIES
Estimate 6 for 2006-07 has risen 8.2% compared with Estimate 6 of 2005-06. Buildings and structures has risen 27.5%. Estimate 6 has also risen 11.6% from Estimate 5 with building increasing by 12.4%% and equipment by 11.2%.
Estimate 2 for 2007-08 is 12.5% greater than Estimate 2 of 2006-07. Building has increased 44.3% while equipment had a small fall. Estimate 2 is 19.2% higher than Estimate 1.
IN CURRENT PRICE TERMS
PROJECTED CAPITAL EXPENDITURE SERIES
The projected series below apply historical realisation ratios to contemporary expectations to convert these to quarterly figures. Trend estimates of resultant quarterly time series of actual and expected expenditure are produced.
The following graphs, with accompanying commentary, show the projected capital expenditure series based on March quarter 2007 data, which includes expected expenditure up to and including the June quarter 2008. Please see paragraphs 29 to 33 of the Explanatory Notes for further details about the methodology and cautionary notes for these series.
TOTAL CAPITAL EXPENDITURE
This series has a trend break applied for the March quarter 2007. Current price trend estimates for total Capital Expenditure have reached a plateau in the past two quarters following significant increases in the previous two financial years. Expectations suggest that while the series has not reached its peak it will see a downwards shift in the following financial year. The maintained growth will come through the building asset class, particularly seen in the Mining industry.
BUILDINGS AND STRUCTURES
Current price trend estimates for buildings and structures have been strong in recent years and while it has eased in the past three quarters expectations suggest a continued surge until a change in momentum in the middle of the 2007-08 financial year. This series has a trend break applied for the March quarter 2007.
EQUIPMENT, PLANT AND MACHINERY
After the strong current price trend growth estimates for equipment, plant and machinery seen from June 2004 through till June 2006 the trend has since shifted downwards.The projections of this series indicate a continuation of this trend throughout the following financial year. This series has a trend break applied for the March quarter 2007.
MINING
Growth in the Mining industry has been a major influence in the growth of total capital expenditure in the past two financial years. Expectations suggest that this will continue into the next financial year with the series reaching a historical peak in December quarter 2007.
MANUFACTURING
The trend series for Manufacturing reached a peak in 2005-06 but has since been on the decline. The projected series suggests that this weakness will continue for the remainder of the 2006-07 and most of 2007-08 before a slight levelling of the series towards the end of the financial year.
OTHER SELECTED INDUSTRIES
This series has a trend break applied for the March quarter 2007. The Other Selected Industries trend series had shown steady growth in the past four financial years. With the introduction of the trend break there is a substantial change in level of the projected series which is expected to see a move downwards in the second half of the financial year of 2007-08.
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