Investor relations professionals have a lot on their hands, shining the investment spotlight on their companies and meeting the constant demands of both Wall Street and their shareholders. But imagine having to handle investor relations for a whole industry.
That’s the chore that Semiconductor Equipment and Materials International (Semi) has taken on. Semi is the industry association for 2,200 worldwide semiconductor equipment manufacturers (1,450 in the US, 350 in Japan and 400 in Europe) which too often find themselves lumped in with the whole semiconductor industry, if not the entire technology arena.
Founded in the US in 1970, Semi has been turning up the heat lately in an effort to get investors to distinguish its member firms – which produce the raw materials and advanced tools needed to make computer chips – from companies which use those components to make, market and sell the chips.
Intel outside
We represent semiconductor equipment makers, not Intel,’ says Dave Ringler, Semi’s Mountain View, California-based director of IR – an unusual job title in an industry association. ‘That’s been part of the problem: we’ve been overshadowed by the chip makers. The fact is semiconductor equipment manufacturers comprise 98 percent of the world’s semiconductor companies.’
One of Semi’s recent moves was to hire Ruder Finn, for whom, handling the PR and investor relations duties for a whole industry isn’t a unique challenge. ‘We’re applying the same strategies to the semiconductor industry as we are to the real estate investment trust (Reit) industry,’ explains Bob Ferris, president of Ruder Finn’s IR group. ‘Three years ago, a lot of semiconductor companies were considered technology plays by investors and not fundamental plays. These companies weren’t being properly judged on their merits. Semi has changed all of that.’
Tom Reid, vice president of Semi, points to the success of industry roundtables bringing together industry members, analysts and media to discuss the economics of the industry. ‘We’ve received a great response,’ he reports. Semi has also reached out to analysts with a quarterly newsletter on the financial prospects of Semi companies and gone out on the road in the US and overseas to tout the industry to analysts. In fact, Semi has set up offices in Brussels, Moscow, Tokyo, Beijing, Seoul, Singapore, and Taiwan.
Using another line of attack, in February Semi hosted its second annual ‘Seminvest’ investor conference. Some 55 companies showed off their stories to 275 investors and analysts in New York then jetted over to London for another batch of presentations to an audience of 80 – almost all institutional portfolio managers. Ferris notes a higher concentration of portfolio managers and analysts relative to corporate finance talent at Seminvest this year.
With only 70 of the 2,200 Semi companies publicly traded, accounting for some $65 bn in sales, another Semi mandate is educating companies on IPOs, showing them how to raise capital. ‘That’s not something you normally see in a trade association,’ adds Reid.
But then again, Semi is hardly what you might call a normal trade association. Nor are its IR activities. ‘I know one thing for sure,’ concludes Ferris. ‘More sell-side analysts are writing about semiconductor equipment and materials companies than ever before – and this in an analytical environment where analysts are covering fewer and fewer companies. The industry is making great strides in terms of public awareness.’
