Financial Market Survey 2012     • A total of 185 respondents have                named listed companies and commented on ...
Survey respondents          Fund managers                              Investment Banks          3 AP-fonden, 4 AP-fonden,...
Table of content     • The communication impact on valuation                Who is successful and what do they have in com...
IR – importance to valuation     • The financial pro’s were asked to mention companies       where communication has had a...
Good communication pays off                                  Higher                Better returns                         ...
Value creating communication                    ”Clear, straightforward and                continuous communication withou...
Mutual characteristics of value creators                 Open             Clear        Transparent                Long-ter...
”Best in class” IR         The three companies that the respondends         considered having created most value through  ...
Value destructive communication                "Investment companies that appear to                have "dual agendas" or ...
And some less flattering…           Manipulative      Misleading     Arrogant                 Overly                      ...
Companies ambivalent on quartely     reporting                                From Box IRs IR survey 2012                 ...
…but how about the investors?                Investors reward long-termism, but would like to keep the                    ...
Text & numbers tougher than presenting                                                      ” Nothing particularly      ”I...
CSR – marginally more important                Despite the debate as of lately, but …© Box IR 2012
Increased pressure to consider CSR                          ” More questions                           from investors”    ...
Important how a CSR incident is managed!      ”What happens         next often        overshadows      the event itself.” ...
4 out of 10 find CMDs better than before© Box IR 2012
Appendix 1     Company questions     1.         Which companies do you consider communicate with investors in a way that  ...
Appendix 1     General questions     7. Some companies want to refrain from reporting on a quarterly basis                ...
Communication rooted in target group                Mikael Zillén      +46 762 13 00 40 | mikael@boxir.se                S...
Box IR                Styckjunkargatan 1                 114 35 Stockholm                    08-21 41 00                  ...
Box IR Financial market survey 2012 summary
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Box IR Financial market survey 2012 summary

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Box IR Financial market survey 2012 summary

  1. 1. Financial Market Survey 2012 • A total of 185 respondents have named listed companies and commented on their communication and investor relations efforts answered questions regarding the Swedish equity market Approx 90 fund managers and 100 analysts & brokers participated in the survey© Box IR 2012
  2. 2. Survey respondents Fund managers Investment Banks 3 AP-fonden, 4 AP-fonden, 7 AP-fonden, ABG Sundal Collier Alcur, Alecta, Alfred Berg, AMF Pension, Carnegie Brummer & Partners, Capman, Carnegie Credit Suisse Asset Manangement, Catella Fonder, Danske Bank Cicero Fonder, Didner & Gerge, DnB Nor, Deutsche bank Futuris, Granit Fonder, Gustavia Fonder, Erik Penser Handelsbanken Fonder, HealthInvest, Handelsbanken Humle Kapitalförvaltning, IKC Fonder, JRS Securities Kåpan Pensioner, Lannebo Fonder, Nordea Madrague, Manticore, Meetoo, Nordea Pareto Öhman Asset Manangement, Norron, Origo Redeye Capital, PSG Capital, QQM Fund Remium Management, Scientia, SEB Asset SEB Enskilda Management, Skandia, Strand Kapital, Swedbank Swedbank Robur, Svolder, Ture Invest, Öresund© Box IR 2012
  3. 3. Table of content • The communication impact on valuation Who is successful and what do they have in common? What is considered as sub par communication? • Quartely earnings reports or not? • Does the market care about CSR? • Is Capital Markets Days important? • Appendix Survey question© Box IR 2012
  4. 4. IR – importance to valuation • The financial pro’s were asked to mention companies where communication has had an effect on valuation • 110 companies were named, and of those mentioned at least twice the respondents consider that 38 companies have created value through communication 35 companies have destroyed value through communication Is this of any importance?© Box IR 2012
  5. 5. Good communication pays off Higher Better returns valuation© Box IR 2012
  6. 6. Value creating communication ”Clear, straightforward and continuous communication without corporate BS and euphemisms have led to increased confidence ...” ”Higher visibility and creates an understanding of the company. Educates analysts / investors / brokers on drivers and continuity creates comprehension and minor fluctuations of negative events” ”IR departments of these companies have a great understanding of the capital market and are also extremely familiar with their company and competitors”© Box IR 2012
  7. 7. Mutual characteristics of value creators Open Clear Transparent Long-term Consistent Accessible and Great understanding of capital markets© Box IR 2012
  8. 8. ”Best in class” IR The three companies that the respondends considered having created most value through communications are: 1. Assa Abloy 2. Hexagon 3. Atlas Copco© Box IR 2012
  9. 9. Value destructive communication "Investment companies that appear to have "dual agendas" or executives that don’t want to admit bad deals until well after the fact” ”Lack understanding of (or ignore) investors view of the company and the expectations in the stock price …” ”Have problems to deliver on already made promises ”© Box IR 2012
  10. 10. And some less flattering… Manipulative Misleading Arrogant Overly Unclear Unaccessible optimistic© Box IR 2012
  11. 11. Companies ambivalent on quartely reporting From Box IRs IR survey 2012 based on108 responses from© Box IR 2012 companies on Nasdaq OMX
  12. 12. …but how about the investors? Investors reward long-termism, but would like to keep the quarterly checkpoints© Box IR 2012
  13. 13. Text & numbers tougher than presenting ” Nothing particularly ”It is simply part of the cumbersome.” job.” Mid Cap Large Cap ”Extended IFRS ”Nothing. The report It is a time-consuming requirements in the creates a natural basis for process, but would not call any component interim reports.” dialogue with the market Mid Cap on performance.” "overly cumbersome." Small Cap Small Cap From Box IRs IR survey 2012 based on108 responses from© Box IR 2012 companies on Nasdaq OMX
  14. 14. CSR – marginally more important Despite the debate as of lately, but …© Box IR 2012
  15. 15. Increased pressure to consider CSR ” More questions from investors” ” Increased focus in the media. Badwill to invest in companies that misbehave.” ”Marginally, but maybe avoiding to a slightly higher degree "bad" companies.” Increased pressure, mainly from the media…© Box IR 2012
  16. 16. Important how a CSR incident is managed! ”What happens next often overshadows the event itself.” ”Classic crisis management where the leadership’s judgement is put to the test." To err is human, not handling it (in the media) is costly!© Box IR 2012
  17. 17. 4 out of 10 find CMDs better than before© Box IR 2012
  18. 18. Appendix 1 Company questions 1. Which companies do you consider communicate with investors in a way that affects the valuation? Which companies created value with good communication? Which companies destroyed value by poor communication? 2. Name companies associated with regular report disappointments? (that rarely live up to market expectations) 3. Name companies that routinely "guide" the market lower than the expected outcome 4. Which companies have an IR person who can "replace" the CEO at investor meetings/ presentations? (i.e. is at such a high level that investors are OK with or even prefer meeting the IR person) 5. Which company representatives or companies do you consider to be the best and worst at investor presentations? Why are these good/bad? 6. Regarding listed companies shareholder friendliness Clearly articulated and justifiable dividend policy (best/worst) Directors who are more loyal to shareholders than the management (best/worst) Limited and reasonable bonus and stock option plans for management (best/worst) Open and transparent communication (best/worst) Shareholder friendliness overall (best/worst)© Box IR 2012
  19. 19. Appendix 1 General questions 7. Some companies want to refrain from reporting on a quarterly basis I want companies to provide comprehensive quarterly reports as before I think semiannual reports supplemented with simplified quarterly ones in between is sufficient I think that semiannual reports is enough 8. Regarding companies social responsibility (CSR) How important is CSR for your investment decision/your assessment of a company? Scale 1-5. Do you notice any increased pressure to take CSR into account in the assessment of listed companies? When a negative CSR incident occurs, such as environmental or ethics, valuation is most affected by (the incident itself, the managements handling of the incident, don’t know) 9. Regarding listed companies capital markets days How important are capital markets day for your assessment of a company? Scale 1-5 Compared to three years ago, the information communicated is (better, worse, not better nor worse, no opinion) 10. "Say on pay" is high on the shareholders agenda in e.g. the U.S. and Switzerland, but more and more countries follow Do you think that high management compensation in Swedish listed companies is a concern for investors? Do you think the debate on high compensation levels affects the willingness to invest in a company?© Box IR 2012
  20. 20. Communication rooted in target group Mikael Zillén +46 762 13 00 40 | mikael@boxir.se Since 2005 worked with financial communications and investor relations both as self-employed and as senior consultant at Citigate Stockholm. Institutional sales at Handelsbanken, Nordea and Danske Bank during more than 15 years. He also has experience from several IPOs. Tomas Öqvist +46 705 54 34 40 | tomas@boxir.se Long experience as top ranked equity analyst at e.g. Carnegie and Alfred Berg. Speaking partner to large Swedish, European and US institutions and also participated in a number of IPOs and M&A deals. Since 2007 he has been a consultamt within financial communication and investor relations. Anders Bruzelius +46 703 50 40 88 | anders@boxir.se With his18 years in the financial markets thorough knowledge of equity valuation and communications. He has worked as an equity analyst at Danske Markets and Carnegie, where he held top rankings in the automotive and engineering sectors. Experience from a number of IPOs and M&A transactions. Until recently, Anders worked as head of equity research at Swedbank.© Box IR 2012
  21. 21. Box IR Styckjunkargatan 1 114 35 Stockholm 08-21 41 00 www.boxir.se© Box IR 2012

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