Industrial turnover index

NOTES ON METHODOLOGY

Legal and methodological framework

Short-term business indicators on industry (the industrial turnover index) can be used to show the monthly market evolution of the products and services produced within industry.

Indices presented in these tables were calculated on the basis of data collected in the Monthly Survey on Industrial Production and Persons Employed (IND-1/KPS/M form), which is directly carried out by the Croatian Bureau of Statistics on the basis of the Official Statistics Act (NN, No. 25/20).

Industrial turnover indices on domestic market serve to measure monthly movements in industrial turnover/production sold realised by industrial enterprises/industrial local units on the territory of the Republic of Croatia, while on the other hand, industrial turnover indices on non-domestic market serve to measure monthly movements in turnover/production sold realised by industrial enterprises/ industrial local units on the non-domestic market, that is, outside the territory of the Republic of Croatia.

Concepts and definitions used in the IND-2/KPS/M Survey are harmonised with the EU concepts and definitions, and especially with the Regulation (EU) 2019/2152 of the European Parliament and of the Council and the Commission Implementing Regulation (EU) 2020/1197, on definitions of variables, list of variables and frequency of data compilation.

Scope and coverage

The IND-2/KPS/M Survey covers enterprises and parts thereof employing 20 or more persons employed and performing one or several industrial activities by definitions of activity coverage of the NKD 2007 (NN, Nos 58/07 and 72/07) for each indicator separately due to the differences in coverage according to legislation of EU.

Industrial turnover index covers only two industrial sections of the NKD 2007, that is, sections B Mining and quarrying and C Manufacturing, and their divisions 05 – 33.

A combined method of using two data sources is used to collect data: an administrative source (98.2% of units) and a statistical source in the way that data are collected directly from reporting units (1.8% of units), mostly from large enterprises where the reporting method via a web-based application (the so-called CAWI) is applied, i.e. reporting units fill in data directly onto the IND-2/KPS/M e-form, which is available on the web site of the Croatian Bureau of Statistics.

The time schedule for data collection for reporting units is between 1st and 15th day in a month for data from the previous reference month. Data on reporting units that are taken over from the administrative source (VAT) are collected 45 days after a reference month, at which point they are available to the Tax Administration and further processed in the Croatian Bureau of Statistics for statistical purposes.

INDUSTRIAL TURNOVER INDICES

Definition of indicators

Industrial turnover indices are chain indices calculated according to value data of the industrial turnover/sales at the level of main activity of industrial local units defined by the Croatian Bureau of Statistics. Indices were calculated by aggregation of industrial turnover value data/sales in the reporting month.

Calculation method

Industrial turnover indices for different levels of the NKD 2007 are calculated for indices at the group level and higher by weighting with the share in turnover value (sales) for defined industrial activities according to the NKD 2007 in respect with each indicator. Indices for MIGs 2009 aggregates¹⁾ are calculated in the same way as well as indices for domestic and non-domestic market. They are presented below.

1) The Commission Implementing Regulation (EU) 2020/1197 of 30 July 2020 laying down technical specifications and arrangements pursuant to Regulation (EU) 2019/2152 of the European Parliament and of the Council, as regards the definitions of Main Industrial Groupings (MIGs).

Industrial turnover

The value of total industrial turnover, that is, income from sales is the invoiced value of reporting local units for the products and services sold during the reference month. It corresponds to the market value of goods and services sold and delivered to third parties on domestic and non-domestic market in the reporting month.

The value of income from sales (turnover) in industry includes all transport and packing costs as well as taxes on invoiced goods and services of the reporting units, except the value added tax (VAT). Excluded are all reductions in prices, rebates and discounts as well as the value of returned packed goods, except cash price reductions. Price reductions, rebates and bonuses granted to customers later (e.g. at the end of the year) are also excluded.

The income from sales (turnover) of products and services to third parties residing in the same country, that is, to residents of the Republic of Croatia, is considered sale on domestic market, while income from sales on non-domestic market is considered sales to non-residents of the Republic of Croatia according to the criterion of the first destination of products or services and change of owner (irrespective of whether the goods or services for which the invoice was issued actually crossed the border or not).

MIGs 2009. aggregates

The calculation of the MIGs 2009. aggregates was done by grouping of the NKD 2007. activities at the level of groups or divisions within sections B and C (05.1 – 33.2) as follows, using alphabetic marks of abbreviations, as follows:

AI    Intermediate goods: the NKD 2007. divisions and groups: 07 – 09, 10.6, 10.9, 13.1 – 13.3, 16, 17, 20.1 – 20.3, 20.5, 20.6, 22 – 24, 25.5 – 25.7, 25.9, 26.1, 26.8, 27.1 – 27.4 and 27.9

AE   Energy: the NKD 2007. divisions: 05, 06 and 19

BB   Capital goods: the NKD 2007. divisions and groups: 25.1 – 25.4, 26.2, 26.3, 26.5, 26.6, 28, 29, 30.1 – 30.4, 32.5 and 33

CD  Consumer durables: the NKD 2007. divisions and groups: 26.4, 26.7, 27.5, 30.9, 31, 32.1 and 32.2

CN   Consumer non-durables: the NKD 2007. divisions and groups: 10.1 – 10.5, 10.7, 10.8, 11, 12, 13.9, 14, 15, 18, 20.4, 21, 32.3, 32.4 and 32.9.

Activity structure according to the NKD 2007.

The structure of industrial activities (division structure) has been calculated for the industrial turnover index on the basis of the turnover value (sales) by using the pure activity principle for the Republic of Croatia. It was calculated on the basis of annual statistical results of the Structural Business Survey carried out by the Croatian Bureau of Statistics and by processing annual administrative data taken over from Fina – the Annual Accounts of Industrial Enterprises, after which it was corrected by using the results of the PRODCOM Survey on Industrial Production. For the calculation of domestic and non-domestic market indices, the structure calculated on the basis of the PRODCOM Survey on Industrial Production is used. The division structure is updated at the beginning of every year for the calculation of indices of the current year.

Indices series presentation

Seasonal and working-day adjustment has been done by using the X13 ARIMA method on the monthly index series, which starts with the January 2000 index for the total industry and for the MIGs 2009 in respect of NKD 2007 activity coverage of each of the indicators. The effect of a random component in the seasonal adjustment process of time series of indices has been excluded.

Due to the character of the implemented seasonal adjustment method, the extension of the index series by adding new monthly observations for each new month could cause subsequent corrections of the already published seasonally and working-day adjusted indices and trend for several previous months.

Gross indices

The term “gross indices” indicates that indices are unadjusted for seasonal and working-day effects. In line with Eurostat’s recommendations and requirements for the industrial turnover index, they are not used for the interpretation of changes. Eurostat does not publish them, neither is it the practice in most Member States.

Seasonally and working-day adjusted indices

The term "seasonally and working-day adjusted" indices is used to indicate that gross indices are adjusted for both seasonal and working-day effects. In line with Eurostat’s requirements for short-term business indicators, the data that are compared to those of the previous month (that is, monthly comparison) are presented in a seasonally and working-day adjusted form of industrial turnover indices or growth rates calculated from them.

Working-day adjusted indices

The term "working-day adjusted indices" is used to indicate that gross indices are adjusted only for working-day effects in line with Eurostat’s requirements for short-term business indicators, while data compared to those of the same month of a previous year (that is, annual comparison) are presented in a working-day adjusted form of industrial turnover indices or growth rates calculated from them.

Trend indices

Time series of trend indices are released with each revision of seasonally adjusted data.

Abbreviations

CAWI                     computer-assisted web interviewing

EU                          European Union

Eurostat                 Statistical Office of the European Union

Fina                        Financial Agency

MIGs 2009.           Main Industrial Groupings, 2009 version

NKD 2007.            National Classification of Activities, 2007 version

NN                          Narodne novine, official gazette of the Republic of Croatia

PRODCOM           PRODucts of the European COMmunity

VAT                        value added tax