10 Tips for Successful Earnings Calls

Posted on Sep 19, 2012 in Corporate Investor Relations, Education/How-To, Investor Relations, Investor Relations Central | 0 comments

By Eric Vidal

Earnings calls are high-profile, high-stakes events. Global audiences, competition for capital and the pressures to perform in today’s business environment put pressure on Investor Relations Officers (IROs) to produce earnings events that are dynamic, meaningful and yield results.

Successful earnings calls require more than sending out invitations and making sure the speakers are properly briefed. Here are 10 tips, drawn from our experience of producing more than 15,000 successful web and audio events per month, to help you deliver flawlessly executed earnings calls.

1. Begin the process early – Start your preparations well in advance. In fact, at the end of the previous quarter is not too early. Present your key messages to management and get agreement on them. Next put together the invitation list, develop your content and schedule your call with your provider. Get the phone-in numbers well in advance. (Request a branded telephone number that reflects your company name or products to differentiate and make it memorable.) Send invitations a week to two weeks in advance. Follow up with reminders two to three days before, and then the day of the call.
2. Develop and Communicate Key Messages – Help investors take away what’s important about your company by developing three to five messages and reinforcing them throughout the call. Focus on key issues from the quarter, weaving them into your script and Q&A. Define the outcomes you want, and then develop messages to elicit that response, supported by proof points. Make sure all speakers have a copy of the key messages, and have your CEO restate the key messages at the end of the call.
3. Make Your Call Interesting and Memorable – Develop a concise script that gives meaningful context to your business results. Identify important trends and help investors understand how they affect your company. During the call, prepared remarks should be read from a screen at eye level, not looking down at a script, and speakers should stand while talking to increase the power of their voices. Speakers should convey enthusiasm.
4. Offer New Information – Touch on the important aspects and add new data points, references and other insights. Help investors make connections about why, what, when and how trends and other external events have affected the company. If you’re going to Tweet during the call, offer information that’s not in the scripted remarks or earnings release, and not promotional in nature.
5. Clarify Your Message – Use slides and video to improve clarity and make key messages more memorable. Visuals can ease barriers to understanding by making complex or technical products and concepts easier for non-technical audiences to understand. At the same time, resist the urge to include granular diagrams that “explain” your business or technology. They will likely increase confusion rather than dispel it. Keep slides uncluttered, with plenty of white space and only key words or numbers. Makes slides, video and an archived copy of the webcast available on-demand.
6. Select the Date and Time Carefully – Know when other companies are announcing their earnings. Industry leaders can draw the audiences they want whenever they want. Others are left to fill in the gaps. You can’t always avoid conflicts but do your best. Otherwise your event may be attended by junior associates rather than the senior analysts you want.
7. Establish a Regular Reporting Routine – Setting a regular schedule gives you and your stakeholders a sense of consistency. Establish a regular day and time for announcements to simplify scheduling and make it easier for everyone involved (executives and investors) to manage their schedules.
8. Prepare for and Rehearse the Event – Rehearse, record and listen to the scripted parts of your call as well as the Q&A. Not only will you feel more comfortable and familiar with the material, you’ll sound more at ease. Stage a technical dry run with your call provider the day before the call. Make sure the host has a minute-by-minute agenda of who speaks when and for how long, and knows how to pronounce the names of your executive team. Check equipment, phone lines, slides and video presentations. Pay attention to details such as a noisy air conditioner or sound bleeding in from outside so you’re prepared to eliminate them on the day of the call.
9. Anticipate Questions and Answers – Since you want to avoid investors taking away misinformation or forming negative perceptions, it’s imperative to craft thoughtful answers ahead of time to as many questions as you can. Create a list of questions with answers that are fully scripted or bullets points, depending on your CEO’s preference. Take the opportunity to weave key messages into the answers. Try to think like an investor. Also be sure to think like a hostile party, and be prepared to respond to the tough questions with good answers.
10. Conduct Post-event Follow-up and Analysis – Contact registrants who didn’t attend and send them the link if you offer the call on-demand. Evaluate your content, presentation and event from your own perspective and that of your attendees. Review Q&A from the session. How many actively participated and who were they? Were you ready for their questions? Were the questions and comments appropriate or did your attendees seem to have missed your key messages? Did most attend the entire session? If not, at what point did they drop off?

Done properly, earnings calls can do more than disseminate information. With a little extra effort, and the assistance of a top-quality provider, you can use them to differentiate your organization, promote your brand and ultimately stand out in a crowded marketplace.