Planning Stress-Free Earnings: What You Need to Know [Webinar Recap]

28 October 2019

By Marla Hurov



IROs don’t need to be told that earnings is one of their most important duties. As a key point of contact with so many stakeholders and market participants, and with such a quantity of information and materials to prepare, the lead-up to the day of the call can be taxing (to say the least).

But it is indeed possible to keep earnings relatively stress-free. It’s all about tackling the big day with the right preparation and approach. In our recent webinar, that was the main theme of discussion for our earnings experts Karen Greene, Investor Relations Partner at Q4, and Matt Van Tassel, Manager of Global Disclosure Services at Business Wire.

Delivering compelling and authentic messages

Having overseen about 70 earnings calls in her former life as an IRO, Karen pointed to the importance of messaging. For her, the key is crafting the message early. Start your preparation at least 30 days before the big day, getting a sense for the directional trend of your company’s earnings. Then meet with business leaders to round out that understanding and filter it down to “the most authentic and important story.”

When it comes to making sure executives are well-drilled on potential Q&A topics, work backwards from the “dream headlines” you would want in media and analyst reports, also preparing for any mitigating factors with “planned fire drills.”

If you’ve had a disappointing quarter, it’s critical to stay as open and communicative as if it was a good one. “It’s not like it’s a surprise to the company,” said Karen. “Get in front of it and own the disappointment. It’s far better to get on the call and explain why the quarter was tough and what you’re going to do about it, rather than hiding behind it.” Matt added: “You can’t hide from your results.” He also advised not changing the usual construct of your press release or other materials. Otherwise, readers might assume that you’re trying to gloss over something.

Being consistent and forward-looking about your messaging is also critical. Karen cautioned: “Think about what you’re saying today for future quarters.” Anything you mention “may come back to bite you” tomorrow.

And while “it’s easy to keep your focus on the Street (your shareholders and analysts), Karen cautioned to also “keep in mind that you’ve got other stakeholders – employees, customers, board members — to have your messages resonate with as well.”

Leveraging prepared remarks

The trend of including prepared remarks in earnings is also on the rise. Karen said that 24% of calls that Q4 handled in 2018 included them — a figure that is expected to rise to 30% in 2019. “It’s a great practice if you can pull it off, but you have to be rock solid with your numbers,” she noted.

However, Matt warned against carrying them out as a default option. “If you’re just reading the highlights from your press release, you’re not really adding anything for the audience,” he advised. “It’s a valuable tool if you’re going to use it, but if not, it might be better to strike it.” In fact, some teams launch straight into a Q&A, without any prepared remarks — which can indeed be a good strategy, as long as your company’s story is already well understood.

Preparing for call logistics

“One of the keys to stress-free earnings is preparation,” Matt said. “You need to build a roadmap and outline of all the deliverables necessary to stage an event — which stakeholders will need what, and when,” he explained.

Matt outlined a few quick planning tips including:

1. Let everybody (including vendors) know when the event is going to happen, as soon as your team signs-off on the date. Also clearly show your date, time, timezone, and dial-in information on your website.

2. Send out press releases a few days in advance, to give journalists and analysts enough time to plan coverage.

3. Prepare the set-up and conduct a technology test-run: trial-run your equipment, audio quality, and any remote connections. Keep it simple. Reduce the variables that could impact your event’s success, such as audience-controlled presentations.

Following-up after the call

When it comes to earnings follow-up, Matt is a big fan of using social media to “broaden the reach of your communication strategy,” particularly with quick video clips of some of the biggest talking points. Also, sharing slide deck visual cues, especially infographics, on social media is a great way to hold attention after the call.

Karen advised checking-in with sell-side analysts immediately after the call, to make sure they understand what the company has put forward. She also emphasized sticking to your established earnings routine. For example, if you communicate with your top ten holders each time, make sure you do it every time.

Another effective post-earnings tool is conducting a sentiment survey — a quick pulse check with top holders, to get feedback on how much the message resonated and if it was effectively communicated. “That also helps us be better prepared for the next call,” Karen added.

With that in mind, Matt offered some final, overarching advice: “Build that roadmap or outline for all of your stakeholders, share it with them, and don’t forget to test for success.”

Want the full story for planning a stress-free earnings? Watch the webinar on-demand here. And be sure to check out our latest blog, Six common earnings pitfalls and how to avoid them.


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