Q: After we have done a major announcement such as financial results, we always go and see a number of our major shareholders one-on-one. Obviously this represents a big investment of our management time. How can I make sure we maximize the value of the meetings for all concerned?
A: In order to get the most out of shareholder one-on-one meetings, time must be invested before and after the event.
First set the agenda. You might have a standard set presentation ready to give, but your audience will rarely want to see it. Be prepared to tailor the meeting for the participants – and that means homework needs to be done. Were they at the results meeting? Or on the conference call? If so, you can assume they listened to the presentation and the Q&A and will be building on that knowledge. If they did not show up, prepare to start from scratch.
Who will be driving the meeting from their side? Chances are that for most meetings, a sector analyst will be in the chair. Companies usually see their top ten or 20 shareholders in one-on-ones after results, and these are likely to be large institutions with dedicated research departments. Make sure you know the name of the analyst following your stock and exchange e-mails (don’t call – they almost all screen their calls and you’ll be fighting with sell-side brokers for phone time) ahead of time to establish some key facts. What issues would they like to discuss at the meeting? Who will be present? For example, if you are a European company that has recently made major US investments, you may find the North American fund manager tagging along. Be prepared.
Also, what do you know about the analyst? How long have they been covering you and what sectors have they covered before? What other holdings in the sector does the institution have? In this firm, how critical is the analysts’ input to the investment process? A brief summary of all these details together with their response to your e-mail should be distributed to your management in advance of the meeting.
At the meeting, make notes of the questions they raise and concerns they have, together with details of how your management addressed them. If you cannot be present yourself, make it clear to those who are that it is more than their life is worth to return without a debrief!
Keep a separate file for each major shareholder, including details of past meetings and correspondence. This is invaluable for subsequent meetings – what issues have they raised in the past? How did you address them? Over time, you will build up a valuable profile of each institution and the individuals who work there.
Finally, post-meeting follow-up is crucial. If you have outsourced this to your IR advisors, be sure they are calling the right people. Remember, analysts may not run money themselves, but they still have egos. If they were chairing the meeting, then make sure they get the call.
Above all, remember that even if the message is not so good, the efficiency and added value of its delivery might go a long way to mitigating its effect.
