Karin Almqvist Liwendahl Director, Investor Relations
‘I lead a team of four in the investor relations department here in Stockholm. With investors all over Europe to deal with, I spend a lot of my time travelling. I visit London, Frankfurt and Paris most often, taking time out to meet with investors and analysts. On average, I spend about 100 days a year overseas, giving presentations and meeting people one-on-one. I’m quite happy being based here in Sweden, though. As over 50 percent of our shareholders live outside Sweden, I do a lot of travelling – but the distances are not usually that great.
When I’m abroad I find that I spend a lot of time educating people about what we do here at Ericsson. Everybody knows about our mobile phones, but many people do not realize that our main business is providing infrastructure for telecommunications. Sure, we manufacture mobile phones as well, but most of our trade is focused on the infrastructure business. This is why we cannot be easily compared to other companies such as Nokia, which is a handset manufacturer. People often link Ericsson and Nokia because we are both Scandinavian firms and both are involved in mobile phones. But Ericsson is more of an all-round telecoms company, rather than a mobile phone manufacturer.
In spite of this, we used to spend about 80 percent of our time talking to clients about our mobile phone division and only about 20 percent on infrastructure. This was interesting because our business is the reverse – approximately 20 percent mobiles and 80 percent infrastructure. But investor attitudes toward our company have now changed and they are a lot more aware of the importance of the infrastructure division.
Working for Ericsson at the moment is quite exciting, because our stock price has been doing so well. Our shares are listed in London, Stockholm and on Nasdaq in New York. Our stock has already risen by about 50 percent this year alone. When the share price changes we call around to find out why, though price fluctuations are often caused by factors beyond our control. For instance, this week our stock has fallen because the whole sector is down, not because of poor performance by our company. While the Stockholm market is not as large as the others, it is just as important to us because many non-Swedish institutions trade on the OM Stockholm Exchange.
Along with telecoms and technology, internet stocks have been driving recent market growth. But for us here in the IR department, the internet is becoming a very important communications tool. At Ericsson, we are constantly developing our web site to better cater to investors. Our company web site even won an award recently, being voted ‘Best listed company web site’ at a business awards ceremony staged by a Swedish newspaper and a consultancy group.
Despite the wider use of the web by investors and analysts, I still need to meet with people on a very regular basis. This week I’ve already attended a broker conference in the south of France at Cannes. Today we have a group of analysts visiting, and they are heading for our mobile phone factory located at Kumla, just south of Stockholm. We make a real effort to bring many investors and analysts over to Sweden on site visits. We have one member of our IR department whose job is dedicated to ensuring that the 170 site visits we have each year run smoothly. Crucially, these trips help us build up good relationships with both sell-side and buy-side analysts. Our senior management is very aware of this and they are very supportive of what we’re doing here in the investor relations department. I have no problem gaining boardroom access in order to discuss important issues with them.
I’ve been working in investor relations for five years now and the practice of IR has changed greatly in that time. I still enjoy my work and despite all the travelling, I like working for an internationally-renowned company such as Ericsson.’
Gary Pinkham Vice President, Investor Relations
‘I work in our New York office and it’s my job to carry out Ericsson’s investor relations activities in the US. There are just two of us based in Manhattan and we cover 29 sell-side and 80 buy-side analysts from the US. Despite running a separate operation for North America, I’m in contact with Karin in Stockholm virtually every day, as we have to liaise with each other on certain issues that affect Ericsson globally.
This company employs over 100,000 people and the US is our biggest market, so my hands are pretty full maintaining contact with analysts and brokers across the country.
For instance, in the past few days I’ve visited key investors and analysts in California, New York and in a couple of days I’ll be in Dallas, where we have set up a site visit and corporate seminar at our labs there for about 20-25 investors. At the end of the week I’m off again, this time to San Diego for more meetings and presentations.
In an industry that’s developing as rapidly as ours, you are bound to spend a lot of time discussing future developments. In fact, I think it’s fair to say that both Karin and myself spend anything from 80 to 100 percent of our time discussing new ideas and innovations that are set to be introduced in the next few years.
Chief among these is m-commerce, whereby mobile phone users will be able to shop through their phones, in the same way that e-commerce is all about people buying goods over the internet. News of all these developments is vitally important to investors and analysts, as it helps them better understand the marketplace in which we operate.
One of our latest moves has been to forge an alliance with Microsoft that will ultimately mean that applications for Internet Explorer can be delivered to your mobile phone. You will have a micro-browser in your pocket, so your desktop will become mobile. In essence, it will mean complete mobile communication. When we were informed of this deal with Microsoft, we quickly issued a press release and called a press conference so that analysts and investors could be kept up-to-date and fully aware. With developments such as these, I have to talk about them in a conceptual way to investors. When talking about high-tech innovations, it is sometimes harder to get the message across to investors and analysts if the product is not yet fully up and running.
With all this innovation around, we are finding that the main challenge for us as IR professionals is to get people to have a realistic view of the industry. Telecoms stocks have been popular in the markets, but there is a lot of hype out there and you need to give people a very clear picture of what’s going on, so that expectations are not set unrealistically high. Ericsson has learned a lesson on this in the past. While our reporting was previously less concise on matters that affect stock valuation, we now give much more explicit guidance to investors. Our reports and bulletins contain an ‘outlook’ section, setting out in black and white our overview of the company and the industry as a whole.
But the primary method I use to keep in contact with investors and analysts is still through presentations and meetings. I occasionally visit clients outside of the US. Indeed, one of the few times when Karin and I travel together is when we visit Japan, which is a very important investor base for this company. Together we make a good team. I’m from a technology and marketing background while Karin’s a former accountant, and despite our different career backgrounds, we get on very well whenever we work together on IR projects.
This is a very exciting time to be involved in the telecommunications business. There is a lot of hype, but there are also a lot of very important new ideas. These innovations are set to become reality in a short time and it’s great to be a part of a very vibrant business. I’ve been doing this job for about a year and it’s a good job to be in. I tend to work some long hours and there’s a lot more travelling involved than I initially expected, but I like it here all the same.’
