By NZHJ December 12, 2017 Trade Focus

Data for October 2017 from CreditWorks Data Solutions confirms the previous outlook – of more of the same for the moment.

DSO likely to stay stable

CreditWorksAlan Johnston says: “As expected, DSO overall remained quite stable throughout October (see graph above), with really only the concrete sector showing improvement, in the form of a four-day reduction.” And the outlook for days receivables? “As previously indicated, this stability is likely to continue over the next couple of months.”

Total debt down a bit

Total debt exposure on the CRISworks database (see graph below) reduced slightly in October, says CreditWorks, which is not unexpected given the general view in the marketplace, that construction has levelled off, even if it remains at maximum capacity.

Will we see an Xmas “drop off”?

Given the backlog of work, due to weather affected jobs and the Government’s intention to speed up the construction of houses (the method of which remains unknown), it remains to be seen if the “drop off” traditionally seen at Christmas period appears this year, or whether builders continue working through.

“Either way,” says Alan Johnston, “cashflow will still stall while administrative staff are on leave during these times.”

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