Box IR http://www.boxir.se/en/ Strategisk kommunikation och Finans i samma låda 2013-06-12T06:36:10Z hourly 1 2000-01-01T12:00+00:00 boxir/englishhttp://feedburner.google.com Box IR expands the team with Ericsson’s Head of Investor Relations http://www.boxir.se/en/2013/ir-2/news/box-ir-expands-the-team-with-ericssons-head-of-investor-relations 2013-05-10T12:46:07Z Box IR The communications agency Box IR continues to add strategic expertise and strengthen the offering further by taking on board Ericsson's former IR and press manager Åse Lindskog. The communications agency Box IR continues to add strategic expertise and strengthen the offering further by taking on board Ericsson’s former IR and press manager Åse Lindskog.
Åse Lindskog will join Box IR’s team of senior advisors. During twelve years at Ericsson, of which nearly three as Head of the IR team and more than nine years as Head of Corporate, Public & Media Relations, Åse managed many communication challenges. Everything from the aftermath of the IT bubble, which led to Sweden’s largest ever rights issue, the financial crisis and the merger and divestment of Sony Ericsson. Prior to joining Ericsson Åse worked as a journalist at Dagens Industri and Veckans Affärer, as well as with corporate governance issues at the Ministry of Enterprise, Energy and Communications. She has also been an equity analyst at Swedbank Robur Funds and General Secretary of the Swedish Society of Financial Analysts.

- Box IR is in a very positive trend, which  is further reinforced with the addition of Åse to the team. Her experience from crisis communications, media and IR broadens and deepens our offering to the benefit of both existing and future clients, says Mikael Zillén, co-founder and partner at Box IR.

- In today’s complex world, companies face increasing challenges in communicating effectively with their target audiences. This requires cutting-edge expertise from the communications industry, and Box IR will form a very strong team with our combination of skills and experience, says Åse Lindskog.

In October 2012, Swedbank’s former Head of equity research, Anders Bruzelius, also joined Box IR.

 

For more information please contact

Mikael Zillén, co-founder & partner, phone: +46 -762-130040, e-mail: mikael@boxir.se

Åse Lindskog, senior consultant, phone : +46-730-24 48 72 e-post: ase@boxir.se

 

 

]]> Twitter continues to increase among Swedish listed companies http://www.boxir.se/en/2012/ir-2/news/twitter-continues-to-increase-among-swedish-listed-companies 2012-11-26T14:11:12Z Box IR Box IR’s annual review of the use of Twitter among Swedish listed companies show that the number of companies with a Twitter account increased by more than 30 percent over the last year. Approximately 33 percent of the 354 companies listed at NASDAQ OMX Stockholm now have a Twitter account. The usage rate shows a [...] Box IR’s annual review of the use of Twitter among Swedish listed companies show that the number of companies with a Twitter account increased by more than 30 percent over the last year. Approximately 33 percent of the 354 companies listed at NASDAQ OMX Stockholm now have a Twitter account.
The usage rate shows a large variation, but Twitter is mainly used as a channel for sending out already published material. Among large cap companies about 60 percent (50) have Twitter accounts, while the corresponding figures for mid and small cap companies is 43 (35) and 28 percent (23).

 
- When we talk to investors, the target group of listed companies’ IR efforts, they rarely focus on the communication channel as such, but rather on content and the quality of the information provided. This was particularly evident during the latest reporting season, when many investors experienced significant deviations between company guidance and actual figures. If companies are to spend additional resources on communication, focus should be on messages and content that increases transparency and trust and not on the channels, says Mikael Zillén, founder and partner at Box IR.

The list “Swedish Listed companies” is a public twitter list provided by Box IR. It currently contains a total of 127 Twitter accounts belonging to 118 companies. If you notice that there is a company missing on the list please let us know so we can correct it.

(Here’s the list: http://twitter.com/#!/list/Box_IR/swedish-listed-companies)

]]> Amazon – an anomaly or proof against the existence investors’ myopia? http://www.boxir.se/en/2012/ir-2/blog/amazon-an-anomaly-or-proof-against-the-existence-investors-myopia 2012-09-14T11:35:34Z Mikael There is an ongoing discussion about whether or not listed companies should be required to publish quarterly reports, one reason being the claim that these create a short-term behavior among both investors and corporate management. One can find many different companies to argue both in favor and against this, but one of the brightest examples [...] There is an ongoing discussion about whether or not listed companies should be required to publish quarterly reports, one reason being the claim that these create a short-term behavior among both investors and corporate management. One can find many different companies to argue both in favor and against this, but one of the brightest examples is Amazon.com Inc.

All-time high

With an increase of approximately 45 percent since January Amazon reached a new all-time high yesterday (13 Sep), despite the fact that profit margins have been under pressure for several quarters. To this, one can add that over the past decade the share has risen by almost inconceivable 1,700 percent.

The margin squeeze is an effect of that the president and principal owner Jeff Bezos is, yet again, willing to make investments in the future and focus on the long term goals without regard to the short-term margin pressure. In other words, investors seem to like this long-term strategy, which runs counter to the general belief that investors would punish investments in future growth and profits.
At the moment the company is valued at over P/E of 100 on the expected profit for 2013, so it is clear that sooner or later the company must start delivering profits and once again grow into the valuation, but it is apparent that for the time being investors expect this will happen.

Speculative owners?
One reason for shares to trade at high multiples can be speculative bubbles driven by short-term money, but the ownership structure in the Amazon is, and has for a long time been, very stable with many of the larger U.S. funds on the shareholder list.
As one analyst puts it, “Amazon has never been a company concerned with meeting its quarterly earnings estimates. And it has delivered outstanding returns to shareholders by doing so. If the quarter beats analyst estimates, wonderful. And if not, then so be it.”

Another argument that runs counter to the view that investors’ short-termism would force management of listed companies to constantly sacrifice long-term growth in order to achieve short-term goals is that in such case privately held companies should generally fare better than their listed peers. That is not true!
Amazon has had a high valuation virtually ever since the listing, which falls back on high confidence in the company’s president and principal owner Jeff Bezos. That some shares fall under pressure while others are hailed for long-term initiatives may simply be explained by rational behavior of the investment community, if you have proven that what you do actually creates shareholder value, you get “the benefit of the doubt”, but the opposite is also true of course.

]]> We asked Professor Baruch Lev a few questions http://www.boxir.se/en/2012/ir-2/blog/we-asked-professor-baruch-lev-a-few-questions 2012-05-29T13:54:10Z Mikael - the author of Winning Investors Over. In the book Winning Investor Over Baruch Lev describes, based on his own and other economists’ research, how to intelligently deal with Wall Street in order to increase the share price (although there are some differences to the European markets, it is to a great extent applicable here). [...] - the author of Winning Investors Over.

In the book Winning Investor Over Baruch Lev describes, based on his own and other economists’ research, how to intelligently deal with Wall Street in order to increase the share price (although there are some differences to the European markets, it is to a great extent applicable here). By using real case studies and supported by rigorous analysis of data Lev shows, among other things, how to build and maintain market confidence and how to deliver bad news effectively.
Winning Investors Over is arguably one of the best books written about investor relations, and clearly shows that despite the uncertainties surrounding the stock market today, it is possible to develop a long-term, mutually beneficial interaction with the investor community.

We asked a few questions to Professor Lev who was on his way to Europe to talk about his book:

About guidance

Q: One objection to providing guidance is: “But then we might have to warn on profits, which will have terrible consequences”. What is your comment on this standpoint?

A: (Regarding warning on bad news.) First, you don’t lose anything on the warning because when the bad earnings come out you will get hit anyway. But if you warn, studies show that your credibility as an honest investor friendly manager increases significantly. Also, the likelihood of being sued by shareholders decreases significantly, though this may not be a great concern in Sweden.

Best way to reach investors

Q: Many companies see investor relations merely as a discipline to comply with rules and legislation, what do you find to be the most effective way to communicate with investors?

A: The most effective way to communicate with shareholders is by providing relevant information beyond the legally required. I devote a whole chapter in my book to this (Beyond GAAP).

The importance of providing the right message

Q: Some surveys claim that communication can make up anything between 25 to 40 per cent of a company’s market cap. What is your view in this matter?

A: I don’t believe you can permanently increase share prices by PR. But if you present better your fundamentals, you can get a substantial price boost, because many companies are undervalued because investors do not understand the complexities of the business.

I can truly recommend Barush Lev’s book Winning Investor’s Over, which can be ordered from, among others, Amazon or Adlibris.

]]> The IR-plan – best friend of the budget process http://www.boxir.se/en/2012/ir-2/blog/the-ir-plan-%e2%80%93-best-friend-of-the-budget-process 2012-02-14T13:48:19Z Mikael Times of great uncertainty normally mean that the budget process includes large or small cutbacks. How the savings will affect your part of the organization depends on how well you can argue for your department’s needs and your ability to back the arguments with facts. Last year we wrote about the importance of having an [...] Times of great uncertainty normally mean that the budget process includes large or small cutbacks. How the savings will affect your part of the organization depends on how well you can argue for your department’s needs and your ability to back the arguments with facts.

Last year we wrote about the importance of having an IR plan as a map and compass over the planned IR activities for the coming year. (See here). A comprehensive IR plan includes, in addition to the planned activities, also a set of measurable goals. A major difference between financial communications/IR and other disciplines is that the former to a great extent can be measured. Examples include share price performance relative to peers, share turnover, volatility (both in general terms as well as in conjunction with reporting earnings), number of shareholders (in total or segmented in to different investor groups) or “soft” factors such as number of investor contacts, inquiry response time etc. A long term, elaborate and well composed IR program can have a major impact on the valuation of a company.

By setting goals and plans for implementation and combining these with quantifiable performance measurements, it is possible to assess the ROI of the IR effort. To achieve a fair valuation is a long term process that requires a long term commitment from the company management. Hence, it is important to commit resources, both human and financial, for these purposes in the long run.

Or as Tom Ryan and the late Chad Jacobs put it in the book Using Investor Relations to Maximize Equity Valuation –”Currently, many CEOs and CFOs dismiss IR as too costly or unnecessary. That’s a precarious stance on a communications function that, at its best, can lower a company’s cost of capital and, at its worst, can destroy management’s credibility, as well as hundreds of millions of dollars in shareholder value”.

In other words, the next time the IR budget is on the table the question should not be how much it can be downsized but rather if you can afford not to spend more.

]]> Macro environment pose the largest IR challenge for 2012 according to listed companies http://www.boxir.se/en/2012/ir-2/macro-environment-pose-the-largest-ir-challenge-for-2012-according-to-listed-companies 2012-01-20T10:40:44Z Box IR Box IR’s annual IR survey, which was conducted during November and December, shows that handling the macro and stock market turbulence is the largest IR challenge for 2012. The number of companies that participated in the survey doubled from 2010, which is a clear sign that there is a large interest from listed companies to [...] Box IR’s annual IR survey, which was conducted during November and December, shows that handling the macro and stock market turbulence is the largest IR challenge for 2012. The number of companies that participated in the survey doubled from 2010, which is a clear sign that there is a large interest from listed companies to discuss matters concerning investor relations.

A total of 120 listed companies answered the survey, which corresponds to a 22 percent response rate. Of companies listed on NASDAQ OMX Main Market over one third responded and over half of the Large Cap companies participated. In addition to IR challenges for 2012 the respondents answered, among other things, questions about whether their companies give quantifiable guidance, measure their IR efforts and how they work to reach foreign investors.

Some other conclusions from the survey:
•    Social media ranks as the least important IR activity while one-on-ones, report presentations and road shows are top ranked.
•    Investor targeting, a structured and determined way to communicate with specific groups of investors, becomes more important in order to raise the efficiency of the IR effort as well as achieving the desired ownership structure.

For a more detailed presentation of the report please contact us at: corporate@boxir.se

]]> Financial sector downsizing adds pressure on IR http://www.boxir.se/en/2011/ir-2/blog/financial-sector-downsizing-adds-pressure-on-ir 2011-11-28T14:49:38Z Tomas Reduced number of specialists, i.e. buy-side analysts and sector-oriented portfolio managers, is the result when institutional investors streamline their organizations. It is increasingly common that former sector or regional specialists are consolidated into teams with European or global investment scopes in an effort to reduce the total headcount and cut costs. This also means that [...] Reduced number of specialists, i.e. buy-side analysts and sector-oriented portfolio managers, is the result when institutional investors streamline their organizations. It is increasingly common that former sector or regional specialists are consolidated into teams with European or global investment scopes in an effort to reduce the total headcount and cut costs. This also means that the need for sell-side analysts is reduced. This group plays an important role in clarifying and disseminating listed companies’ investment case and corporate story to institutional investors. Certainly, the analyst surviving the cutbacks are often the more senior ones, but they also have to cover an increased number of companies, or simply cease coverage of the companies that are not “worth the effort”.

So, what does this mean for IR departments?

To begin with, let us conclude that the IR function will increasingly need to communicate its “investment case” with much less support from external analysts. Even though analysts forecast accuracy is often questioned, they are usually very good at capturing a company’s corporate story and summarizing why somebody should invest in the company’s shares (or the opposite in case of a sell rating, which, after all, is less common). With a weaker support of the essential investment case, many IR departments are going to realize that reaching out with their “equity story” it is not always an easy task. However, this is also an opportunity for smaller companies to become more visible in comparison with the medium-sized companies.

More generalists on the buy-side pose an additional IR challenge, as the companies now have to compete for investors’ attention with an even greater number of investment alternatives. Hence, it will be a waste of time to face investors with an unclear message and weak arguments for investing in the company’s shares. Conversely, there is probably a greater potential to attract investors based on a strong investment case rather than on sector or geography.

In other words, now is not the time to postpone communication efforts or to wait for better times before looking over the message to investors. Shareholder value is created through growth and earnings, but also through a deliberate and long-term IR strategy. Downsizing of the financial sector is a reality and companies that don’t realize that the playing field is changing and adapt their financial communication accordingly will undoubtedly find it harder to attract capital in the future.

]]> Twitter is gaining momentum among Swedish listed companies http://www.boxir.se/en/2011/ir-2/twitter-is-gaining-momentum-among-swedish-listed-companies 2011-10-26T10:17:28Z Mikael Box IR’s recurring analysis of the use of Twitter by Swedish listed companies’ shows that companies with a Twitter account has increased by over 60 percent since year end. A little bit over half the Large Caps have a twitter account, corresponding figures for Mid and Small Caps are approximately 35 and 23 percent. The [...] Box IR’s recurring analysis of the use of Twitter by Swedish listed companies’ shows that companies with a Twitter account has increased by over 60 percent since year end. A little bit over half the Large Caps have a twitter account, corresponding figures for Mid and Small Caps are approximately 35 and 23 percent.

The list “Swedish listed companies” is a public Twitter list provided by Box IR. It currently consists of 97 Twitter accounts belonging to 90 listed companies. If you miss a company on the list please contacts us and we will make a correction. (The list can be found here)

]]> How to cope with the IR Smiley-Effect™? http://www.boxir.se/en/2011/ir-2/blog/how-to-cope-with-the-ir-smiley-effect%e2%84%a2 2011-10-21T10:29:37Z Mikael When we recently did our Financial Market Survey 2011 we distinguished something that we call the IR Smiley-Effect™. It is by no means a revolutionary finding or something that you couldn’t intuitively figure out, but sometimes you need to put a label on things before you can start to think about solutions. The IR Smiley-Effect™ [...] When we recently did our Financial Market Survey 2011 we distinguished something that we call the IR Smiley-Effect™. It is by no means a revolutionary finding or something that you couldn’t intuitively figure out, but sometimes you need to put a label on things before you can start to think about solutions.

The IR Smiley-Effect™


As shown in the figure above the IR Smiley-Effect™ is a combination of accessibility and IR quality. It is not surprising that the management of a small company is more accessible than the equivalent of a large cap, even if they devote the exact same amount of time the small cap CEO will have to fight some attention whereas the CEO of a large cap must be more selective with accessibility. In the same way it is fairly obvious that a large IR budget, which tends to grow in conjunction with company size, will have an impact on how the IR effort of a company is perceived. The big question however is if you can do anything about the IR Smiley-Effect™?

In our opinion, the answer is definitely yes.

Small companies can rarely afford to have a dedicated IR person and feel somewhat hesitant on opening the door to “expensive” consultants. But if you put a value on the discrepancy between accessibility and IR quality, it will become easier to reallocate resources towards guiding the IR effort in the right direction. If you put a price tag on CEO time and reduce the grade of accessibility slightly at the same time as you raise the IR-quality, shareholders will become double winners. A greater focus on operations combined with better communication is a cost effective way to build greater shareholder value in the long run.

For large caps it is more about maintaining the current level of ambition with a small focus adjustment. The quality of the IR work is considered to be good and management cannot spare any more time. Of course management’s time can be optimized, for example to participate in contexts where they not only meet large number of investors but also the right investors. Then the question is whether it is possible to do anything about accessibility without offering personal meetings, so called one-on-ones. Naturally one way is to offer extensive, relevant and easily accessible information on the IR web. Another way is to take advantage of “new” technological advances and hold web based meetings, which can be done in both large and small formats. If information is packaged in the right way accessibility will increase, without managerial time going to waste.

The mid-sized companies are in a limbo, as they are neither on top nor at the bottom. So even if the remedy should contain parts of both measures mentioned above it is wise to initially focus on raising the IR quality before addressing the accessibility issue. A first action could be to let someone with an external perspective make a review of the company’s IR status combined with a plan on how to raise the IR effort.

What actions would you suggest in order to rub the smile away from the IR Smiley-Effect™?

]]> Don’t be afraid of the robots! http://www.boxir.se/en/2011/ir-2/don%e2%80%99t-be-afraid-of-the-robots 2011-10-06T12:44:05Z Box IR Final words as well as two of the conclusions drawn at Box IR’s seminar about robot trading, held on October 5, were not to view robots as a threat and that financial communications will become increasingly important. High frequency trading, algorithm trading and black-box trading and last but not least the term that has had [...] Final words as well as two of the conclusions drawn at Box IR’s seminar about robot trading, held on October 5, were not to view robots as a threat and that financial communications will become increasingly important.

High frequency trading, algorithm trading and black-box trading and last but not least the term that has had the greatest media impact as of lately, robot trading, are all expressions that describe new trading patterns on the stock market. Media coverage about these new phenomenon’s has to a large extent consisted of capitalists side by side with left wing politicians standing on the barricades and almost universally demanding prohibition and not so much on what the robots actually do. The aim with the seminar was partly to bring some clarity in to what lies behind all these terms and mainly to find out if and in that case how this will affect the IR work of listed companies.

We will in a couple of upcoming blog post run through some of the major takeouts from the seminar. For those interested, please contact us, for a more thorough presentation.

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