The net balance of firms reporting increased production slipped to 20 per cent, from 23 per cent in the December quarter of 2003.

Despite the relative strength of production, the survey result indicates that companies are struggling to lift profitability.

Among the survey’s key findings, manufacturing activity improved in eight of 12 sectors, led by the fabricated metal products, transport equipment, machinery and equipment, chemicals, and petroleum and coal products sectors.

Activity also strengthened in paper, printing and publishing, wood and wood products and furniture, textiles and clothing and footwear.

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