IR Clubs Videos (IR Club) - IR Club

Laura Kiernan of NIRI on IR trends in 2024

2024-04-14T19:41:51.796Z

IR-Experte Henning Zülch: "Wer mehr macht, wird mehr gehört"

2024-03-27T18:50:54.639Z

Die Aufmerksamkeitsökonomie, in der die Konsumenten nicht gelangweilt werden wollen und sich stark über die sozialen Medien informieren, wird zu einer Herausforderung für die klassische Kapitalmarktkommunikation. Das glaubt der Wissenschaftler Henning Zülch, der an der HHL Leipzig zu Accounting- und Investor-Relations-Themen forscht und lehrt: „Die Unternehmen drohen gerade, in der digitalen Community die Deutungshoheit über ihre Zahlen zu verlieren“, warnt er.

Die Investoren wollen „die relevanten Daten sehen, aber nicht extrem elaboriert, sondern einfach, und ausgespielt über Social-Media-Kanäle“, beschreibt er im Gespräch mit FINANCE-TV die Herausforderung. „Storytelling lautet hier das Stichwort, kommunikatives Reporting, digitale Equity Story. Linkedin wird die Plattform sein, die als Kommunikationskanal künftig alles dominieren wird.“

Doch noch agieren die IR-Teams in Deutschland in dieser Hinsicht zögerlich. „Zum Beispiel verfügen nur wenige der 160 größten börsennotierten Unternehmen in Deutschland über einen digitalen Geschäftsbericht. Aber einen PDF-Geschäftsbericht kann man sich einfach nicht mehr leisten.“
Ist bei der Modernisierung der Investor-Relations-Arbeit der CFO gefragt? Zülch: „Ja, das muss von oben vorgegeben werden, und dann wird das IR-seitig auch gelebt. Aber man schiebt Dinge gerne vor sich her, und digitale Investorenkommunikation gehört leider dazu. Aber wir müssen die Finanzkommunikation neu denken. Unternehmen brauchen Videobotschaften, Erklärvideos und so weiter. Das Gute ist: Wer mehr macht, wird auch mehr gehört – auch am Kapitalmarkt. Aber nur 20 Prozent der IR-Teams in Deutschland beherrschen das bereits.“

Wie ein guter digitaler Geschäftsbericht aussieht, wie intensiv digitale IR-Kanäle bespielt werden können und wie wichtig Finfluencer in Zukunft für die Wahrnehmung eines Unternehmens am Kapitalmarkt sein werden – die (kritische) Bestandsaufnahme von Henning Zülch bei FINANCE-TV.

Earnings Calls: A Corporate Perspective

2024-03-16T17:28:44.479Z

Capital Markets / Investor Relations in Two Minutes or Less
Earnings Calls: A Corporate Perspective

For corporate executives creating an earnings call, one premise governs the entire process: Do Not Trip Reg FD!

The goal is to minimize downside risk, and therefore script and prepare as much as possible.

What does scripting mean?

Create estimated questions or comments so that we can prepare the executives with bullet point answers, so as not to trip up Reg FD during the call, live Q&A, and call backs!

Executives are human and sometimes need prompts or triggers to ensure the right message is delivered and they feel both set up for and feel they can accomplish success.

There is no room for insane or wacky surprises!

Therefore, Q&A represents a significant risk for corporate executives regarding Reg FD.

How Can a Sell-Side Analyst Ensure a Question During Q&A?

1. Thoughtful and / or Unique Value-Add Research
2. Quality of Investor Meetings
3. Investment Banking Relationship: Treasury and Lines of Credit

Right, wrong, or indifferent, an analyst working for an Investment Bank that puts its balance sheet to work for the company will always have access.

A public company cannot afford to disrupt a banking relationship that is essential to run the day-to-day operations of the underlying business.

Like an investment banking deal, getting a question is a jump ball for all the other Q&A slots, and we will do our best to be egalitarian.

How Do You Get the First Question?

1. Are You a Supporter of Management?
2. Are You Willing to Ask a Question that Helps Set Q&A Up to Be Successful?

If an analyst is supportive and willing to set Q&A up for success they have a great shot at the first question.

Variables Driving Participation and Question Slot Order

1. Best Research that Quarter
2. Management Respect
3. Best Relationship w/ Top 20 Investors
4. Investment Banking: Credit and Treasury Services
5. Who Do Investors Like Best that Quarter
6. Elephant in Room
7. Willing to Set Up for Success in Q&A

Investor Relations Officers should strive to be advocates for their Sell-Side Analysts. Sometimes, giving a new analyst, a chance can really drive your stock and thesis forward!

Playing games with Q&A access or radical positivity are problematic. The Buy-Side and Sell-Side will see through the tactics and punish the stock accordingly.

If you avoid triggering Reg FD, are supportive in terms of driving success, and take a dispassionate approach, you will likely get to ask a question on the call!

Earnings Calls - A Sell Side Perspective

2024-03-16T17:27:57.985Z

Capital Markets / Investor Relations in Two Minutes or Less
Earnings Calls: A Sell Side Perspective

Stop Pressing *1 at 4:15 PM for a 5 PM Earnings Call!

There are three components to a successful earnings call for Sell-Side Equity Analysts:

1. Visibility in Q&A
2. High Quality Financial Guidance
3. Strategic Vision

Real Estate is all about location, location, location.

An earnings call for a Sell-Side Equity Analyst is all about visibility, visibility, visibility, or information, information, information.

The most important component of Sell-Side Equity Analyst participation on a conference call revolves around asking a question during Q&A.

Why?

An analyst wants to ask a question during Q&A to drive visibility with Buy-Side investors.

Therefore, analysts get really upset when they are not allowed to ask a question on the call.

Can the Call Be a Success Without Asking a Question?

Yes. Some do not want to ask a question!

All about high quality management call backs after the earnings call.

Three Key Rules to Management Call Backs:

1. Call Everyone Regardless of Actual Rating
2. Consistent Message Across All Analysts
3. What am I Missing?

Following these rules will make your call a success regardless of getting a Q&A question.

The method was wildly successful for me when I ran Investor Relations for Caesars Entertainment in 2019.

I have used this method everywhere I have run an Investor Relations program and it is insanely successful in terms of controlling the narrative for a public company!

Compromise Solution

An ideal solution to keep everyone happy might revolve around the following:

1. Providing a highly detailed earnings supplement, like most REITs
2. Just do Q&A for your earnings call!

At the end of the day, an earnings call of only questions will be more engaging and value-add for everyone participating!

Secondary Goals of a Conference Call for Sell-Side Analysts

1. Financial Modeling Inputs
2. Strategy for Next Quarter, Year, and Thereafter

Beyond Q&A, analysts need management to provide financial guidance and the key inputs to generate a financial model around that financial guidance.

Additionally, investors need insight into the go-forward strategy for the company.

What Is a Successful Call for a Sell-Side Analyst?
1. Getting a question during Q&A, or provide quality information,
2. Getting the right inputs to build a detailed and accurate financial model, and
3. Getting insight on the company’s go-forward strategy

If management can accomplish these three things, the sell-side research community will remain happy!

Earnings Call Preparation: What Goes Into Must See TV

2024-03-16T17:26:42.483Z

Capital Markets / Investor Relations in Two Minutes or Less
Earnings Call Preparation: What Goes into Creating Must See TV

The fundamental philosophical goal of an earnings call should be to create Must See TV!

A company should rightfully want and expect maximum engagement with its earnings call from both the Buy-Side and Sell-Side communities.

Creating a Must See TV earnings call requires significant time and preparation that often goes unappreciated by the investor community.

Six Fundamental Considerations About Earnings Calls

1. Earnings Is Not a Natural Function of the Company
2. Earnings Are Not Extemporaneous – Scripted; Not Off the Cuff
3. Reg FD requires significant preparation and development of commentary
4. Q&A is scripted and prepared in advance
5. Downside Risk: not acceptable to have an analyst blow up management w/ question

Best-in-class earnings preparation occurs over several weeks.

The most harrowing preparation is last minute and occurs over one or two days.

Preparation involves each of the following:

1. Writing a script for CEO and CFO
2. Editing the script with input from C-Suite
3. Multiple walk throughs of the script
4. Financial Guidance
5. Key industry data inputs / topics
6. Significant word smithing and message editing; tone and accentuation
7. Q&A preparation
8. Investor Presentation update
9. Quarterly Earnings Presentation update / creation

Earnings materials are a secondary or tertiary product for the company. The primary focus of employees is managing and running the underlying business.

A lot of time is spent tracking down information from different areas of the company.

Great IROs will create a list of questions in order to prepare management ahead of the earnings call.

Some executives prefer to have several read throughs of the earning script ahead of the call.

Some executives memorize their script. Others really like pre-recording their script.

The IRO might spend an hour with the CEO wordsmithing the tonality and single word choice in one part of the script.

Investors need to remember that most public company executives are operators of a business.

Many of these executives have not had the public speaking experience or the ability to always have a thoughtful sound bite quote when asked a question on the spot.

The best preparation shines through in the materials.

Think of the companies with investor decks, earnings scripts, and earnings releases that provide

1. Exciting future strategic vision
2. Financial modeling inputs
3. Thoughtful and transparent metrics about the performance of the underlying business

A Must See TV earnings call represents a lot of hard work focused on investors.