BRYTE CONSTRUCTION ACTIVITY MONITOR: JULY 2018
We are excited to share the second edition of our Bryte Construction Activity Monitor, which analyses long-term insured construction projects data within the South African market, as captured by us, and provides a high-level overview of activity within the country’s construction sector.
The construction sector has faced an exceptionally challenging 2017, reaching 17-year lows however, it remains ‘one of the economic engines’ of the country and holds immense potential for the advancement of South Africa’s general financial well-being. In contrast, within our business, stronger performance is noted as every quarter in 2017 outperformed insured construction activity when compared to corresponding periods in 2016.
The 17-year period analysed provides an extensive view of trends and some of the key points to note, include:
- Growth in insured construction activity noted in 2017 when compared to 2016
- Peak in insured construction activity in Q1 2017
- Four of the top six large construction companies lost 50% – 75% of their share price in 2017
- By June 2018, some construction companies experienced further losses – some as high as 90% of their 2016 value
We are delighted to announce the first edition of our Bryte Construction Activity Monitor, which provides a high-level overview of activity within the South African construction sector. This sector plays a vital role in growing the South African economy and is particularly important for our business.
The Bryte Construction Activity Monitor has been designed to measure, on a quarterly basis, changes in construction projects that are insured by Bryte. Our launch edition, particularly, looks at historical data since January 2001 – painting a comprehensive picture of trends over the past 16 years.
In addition to this, the Monitor highlights the infrastructure investment by the South African government (over an extended period) as well as the spend by some of the biggest construction companies in the country.
These are some of the highlights:
- A contraction of 15% year-on-year in insured construction activity for the second quarter of 2017
- Shrinking contribution to GDP
- A 12.9% decrease in the value of approved building plans
- A 26% contraction in the order books of the seven largest South African construction companies
- A steady increase in public-sector infrastructure spending