Archive for Investor Relations
January 7, 2010 at 9:00 am · Filed under Investor Relations, Issues Management, Public Relations
Yesterday Jetstar announced a partnership with AirAsia that starts with joint-procurement agreements and extends to service agreements at shared airports. The deal centres on two similarly aligned organisations looking to reduce costs.
Yet by carefully crafting messages – and relating those to the company’s core values – Jetstar placed its consumers at the centre of this ho-hum corporate deal. To showcase the power of public relations, think through these two different headlines:
JetStar Alliance To Cut Cost (hypothetical)
Jetstar Deal Means Lower Asia Fares (The Australian – front page)
In the front page article, new partner AirAsia said round trip fares between Melbourne and Kuala Lumpur should drop $200 to $600 per person. The ability to demonstrate an immediate consumer benefit means a lot. Consumers will support restructuring, even some job losses, if they perceive an immediate benefit.
Frequently companies seek public relations counsel to manage restructuring announcements. They’ll develop announcements with euphemisms for job losses. Downsizing. Restructuring. Business Process Reengineering. And my favourite, “Rightsizing”.
Author Don Watson developed a handy reference tool for those seeking to understand dense corporate-speak. “Weasel Words” is a collection of “contemporary clichés, cant & management jargon.” There Watson offers this definition to “rightsizing” – Job Eliminations.
When developing messages to support a restructure, think to the end consumer. What’s the benefit? Quicker call times? Lower costs? Better products? If you place the consumer at the heart of your messages you’re transactions are going to be better received.
October 15, 2009 at 8:39 am · Filed under Investor Relations, America
I never have buyer’s regret because when I think I want something I get it. Yes, that’s me - I am the consumer driving the economy back to life. I’m also a frustrated office worker who rips past shops on his way to meetings. So when I do have time retail therapy is great.
So imagine my upset having passed up an opportunity to buy a Dow Jones 10,000 baseball cap on eBay. (Not bought because my head looks deformed in a cap.) This was sold in the heady days of 1999 when the Dow Jones passed the 10,000 mark for the first time in March of that year.
(Do you remember those euphoric times? Our homes had equity…Circuit City was our weekend destination…our jobs were secure…we could eat and pay the bills simultaneously.)
Since then the Dow Jones has passed the 10,000 mark on decent, on ascent, on descent, on ascent. It’s been like a theme-park adventure ride. (The 10,000 barrier was broken upwards in March 1999, December 2003 and October 2009.)
The Dow Jones Index is a portfolio of shares in America’s leading companies. Their composite value is the Dow Jones Index. This was designed to showcase the relative health of a representative sample of America’s top companies. Over the years some major companies have been struck from the Index, while newcomers have taken their place. It’s a PR nightmare to deal with a CEO whose firm is being de-listed from the Dow Jones Index. They’re rarely as upbeat as the newcomers.
So break out the home equity line of credit applications - the Dow Jones is back up, glod is strong and economists predict The Great Recession is over.
Me? I’m going to keep scouring eBay and try to find my historical souvenir - that baseball cap from March 1999 is mine!
Trivia Challenge (scroll past cartoon for answers)
- Name the company in today’s Dow Jones Industrial Average with the longest tenure?
- Which company is the newest kid on the block?
- When was it founded?
- Name the founder.
- When did the Dow Jones close above the 1,000 barrier for the first time?
- How many years did it take to go from 1,000 to 10,000?
- During the dot.com boom, a book predicted the Dow Jones would ascend higher - what was the forecast projected high?
- What was the highest close for the Dow Jones Index?
Courtesy of The Huffington Post
Trivia Answers - Thanks to Wikipedia
- General Electric was one of the original 12 companies listed in the average
- Travelers - the insurance giant - added on 8 June 2009
- The Dow Jones Industrial Average was founded May 26, 1896
- Founded by Charles Dow
- On November 14, 1972 the average closed above the 1,000 mark (1,003.16) for the first time
- On March 29, 1999, the average closed above the 10,000 mark - 26 years, 4 months and 2 weeks later.
- Authors James K. Glassman and Kevin A. Hassett went so far as to publish a book entitled Dow 36,000.
- On October 9, 2007, the Dow Jones Industrial Average closed at the record level of 14,164.53.
Your Score
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- 0-3 - Don’t worry you’re job at Treasury is safe
- 4-6 - An average American with a Schwab account - go day trading!
- 7-8 - Thanks for reading WallyDownUndy Mr. Buffet!
- Still debating accuracy of answers - The 24 year prison sentence for Enron does give you time, right Mr. Skilling?
March 4, 2009 at 8:37 am · Filed under Investor Relations, Public Relations
It’s financial results time in Australia - and the picture is far from rosey. Seems a number of companies decided to post their financial results on a Friday. Thanks to Stephen Mayne of The Mayne Report for compiling a chronology of one day’s announcements. For the record, here are the losses announced on Friday, 27 February 2009:
8.28am, Reckson New York Trust: $74.8m loss
8.29am, Pike River Coal: $NZ9.56m loss
8.29am, Hedley Leisure & Gaming: $174m loss
8.42am, Paperlinx: $567.5m loss
8.55am, HFA Accelerator Plus: $163.4m loss
9.11am, Chandler Macleod: $2.5m loss
9.17am, Funtastic: $50.8m loss
9.19am, Oz Minerals: loss of $2.4 billion.
9.23am, Staging Connections: $15.1m loss
9.27am, Every Day Mining Services: $10.1m loss
9.34am, GPG: $110m loss
9.35am, Trafalgar Corporate: $33.2m loss
9.38am, Roc Oil: $430m loss
9.40am Abacus Property Trust: $52m loss
9.42am, GPT: $3.25 billion loss
9.47am, Babcock & Brown Infrastructure: $245.8m loss
10.05am, Clinuvul Pharmaceutical: $9.05m loss
10.09am, Crown: $407.9m loss
10.17am, Rubicor Group: $20.8m loss
10.21am, GRD: $66.7m loss
10.32am, Tap Oil: $7.5m loss
10.34am: SciGen: $7.8m loss
10.37am: Ambition Group: $24.5m loss
10.41am: Drillsearch Energy: $5.5m loss
10.50am: Templeton Growth Fund: $14.5m loss
10.55am, Transoil Corp: $6.03m loss
11.04am, Babcock & Brown Capital: $1.43bn loss
11.11am, Tissue Therapies: $1.78m loss
11.12am, Rey Resources: $1.7m loss
11.18am, Sofcom: $77.7m loss
11.19am, ITL Ltd: $1.9m loss
11.20am, Clime Investment Management: $2.97m loss
11.25am, ORT Ltd: $1.62m loss
11.26am, Swish Group: $1.2m loss
12.03pm, India Equities Fund: $11.6m loss
12.04am, Teys Ltd: $2.04m loss
12.04pm, Environmental Clean Technologies: $1.05m loss
12.06pm, Sun Biomedical: $1.25m loss
12.20pm, Lend Lease Primelife: $204m loss
12.50pm, Lifestyle Communities: $2.24m loss
12.56pm, Western Areas: $12.34m loss
1.15am, Heartware International: $40m loss
1.16pm, Forest Enterprises Australia: $4.1m loss
1.18pm, Medical Therapies: $2.16m loss
1.19pm, Compass Hotels Group: $80.5m loss
1.20pm, RuralAus Investments: $1.2m loss
1.26pm, Automotive Technology Group: $2.96m loss
1.27pm, Univesrsal Biosensors: $12m loss
1.38pm, Allomak Ltd: $68.17m loss
1.40pm, Tyrian Diagnostics: $3.89m loss
1.45pm, Dyesol: $4.54m loss
1.50pm, ING Industrial Fund: $445.9m loss
1.52pm, KLM: $1.4m loss
2.15pm, Phoslock Water Solutions: $1.54m loss
2.29pm, Coretrack Ltd: $1.02m loss
2.32pm, Avita Medical: $2.96m loss
2.38pm, Electrometals Technologies: $2.3m loss
2.51pm, Hyro Ltd: $41.4m loss
2.55pm, Acuvax Ltd: $1.82m loss
2.57pm, Australian Education Trust: $41.3m loss
3.03pm, Novogen: $8.97m loss
3.05pm, Amazing Loans: $21.05m loss
3.06pm, APN Retail European Property Trust: $297m loss
3.10pm, Indigo Pacific: $6.6m loss
3.10pm, Contango Capital Partners: $26.2m loss
3.12pm, Rox Resources: $1.31m loss
3.13pm, Powerlan: $4.63m loss
3.20pm, Vinoto Ltd: $1.7m loss
3.21pm, Phylogica: $2.86m loss
3.22pm, Broad Investments: $2.59m loss
3.22pm, Everest Babcock & Brown Alternative Investment Trust: $300m loss
3.23pm, Praemium Ltd: $6.6m loss
3.25pm, ICSGlobal: $1.11m loss
3.28pm, Neuren Pharmaceuticals: $NZ18.43m loss
3.33pm, Over Fifty Group: $9.83m loss
3.33pm, Transpacific Industries: $52.6m loss
3.34pm, Macquarie Fortress Notes: $61.07m loss
3.39pm, ING Real Estate Community Living Group: $242.4m loss
3.40pm, China Century Capital Ltd: $2.88m loss
3.47pm, KTL Technologies: $2.63m loss
3.48pm, JV Global: $1.82m loss
3.52pm, Contango Microcap: $64.85m loss
3.53pm, 4C Security Solutions: $1.3m loss
3.54pm, LinQ Resources Fund: $225.83m loss
3.54pm, Astron Ltd: $5.83m loss
3.55pm, Jatoil Ltd: $1.8m loss
4.00pm, MacarthurCook: $11.46m loss
4.03pm, Natural Fuel: $40m loss
4.04pm, Two Way Ltd: $1.42m loss
4.06pm, Biosignal Ltd: $3.3m loss
4.08pm, Metal Storm: $10.65m loss
4.11pm, Community Life: $2.5m loss
4.11pm, BBX Holdings: $1.6m loss
4.11pm, Cellnet: $10.2m loss
4.15pm, China Cattle Ltd: $1.4m loss
4.17pm, Jackgreen Ltd: $1.9m loss
4.17pm, Wentworth Holdings: $10.26m loss
4.17pm, AnaeCo Ltd: $2.38m loss
4.18pm, Van Eyk Blueprint Alternatives Plus: $11.64m loss
4.22pm, Century Australia: $5.03m loss
4.23pm, Benitec: $1.13m loss
4.31pm, Allco Max Securities and Mortgage Trust: $105.17m loss
4.32pm, Select Vaccines: $1.16m loss
4.34pm, Carnegie Corporation: $5.96 loss
4.37pm, Celtex: $1.2m loss
4.37pm, National Leisure & Gaming: $8.45m loss
4.38pm, Jupiter Mines: $1.5m loss
4.41pm, Allstate Exploration: $1.3m loss
4.41pm, Range River Gold: $2.15m loss
4.42pm, Hudson Investment Group: $3.87m loss
4.43pm, CBD Energy: $2.29m loss
4.44pm, Enviro Mission: $3.8m loss
4.44pm, Datadot Technology: $7.75m loss
4.45pm, Bluefreeway: $14.65m loss
4.45pm, Shaw River Resources: $1.9m loss
4.46pm, ING Private Equity Access: $8.2m loss
4.46pm, Jervois Mining: $1.28m loss
4.47pm, Boulder Steel: $4.04m loss
4.54pm, Salinas Energy: $2.86m loss
4.57pm, Perilya Resources: $77.17m loss
5.01pm, Mercury Mobility: $1.7m loss
5.01pm, Zylotech: $1.36m loss
5.02pm, Van Eyk Three Pillars: $27.6m loss
5.06pm, Commquest Ltd: $46.4m loss
5.09pm, Flat Glass Industries: $4.67m loss
5.10pm, Living Cell Technologies: $2.89m loss
5.12pm, Fig Tree Developments: $1.49m loss
5.14pm, Polartechnics: $4.43m loss
5.16pm, ChongHerr Investments: $1.28m loss
5.25pm, Cue Energy: $16.72m loss
5.26pm, Australian Biodiesel: $1.9m loss
5.27pm, Cloncurry Metals: $3.54m loss
5.27pm, Viento Group: $6.21m loss
5.27pm, AFT Corporation: $1.12m loss
5.28pm, Kings Minerals: $4.39m loss
5.28pm, 3Q Holdings: $2.49m loss
5.32pm, Green Invest: $1.39m loss
5.33pm, Optiscan: $5.62m loss
5.35pm, Facilitate Digital Holdings: $2.1m loss
5.37pm, Carbon Conscious: $1.1m loss
5.39pm, Minerals Corporation: $11.7m loss
5.40pm, Marine Produce: $3.86m loss
5.40pm, Multistack International: $8.5m loss
5.42pm, Sirius Corporation: $1.06m loss
5.42pm, African Energy Resources: $1.41m loss
5.43pm, Omnitech Holdings: $1.05m loss
5.44pm, Fermiscan Holdings: $9.24m loss
5.44pm, Amex Resources: $1.37m loss
5.47pm, Advanced Ocular Systems: $18.54m loss
5.47pm, Nusep: $1.95m loss
5.48, Coltech Australia: $1.13m loss
5.51pm, Fox Invest: $6.12m loss
5.52pm, Pacific Environment: $1.74m loss
5.54pm, TTA Holdings: $1.24m loss
6.01pm, Wasabi Energy: $12.2m loss
6.04pm, CVC Ltd: $56.2m loss
6.06pm, Austpac Resources: $1.07m loss
6.07pm, Charter Pacific: $4.77m loss
6.09pm, Luminus Systems: $11.1m loss
6.11pm, Planet Gas: $17.07m loss
6.12pm, Australian Power & Gas: $5.65m loss
6.13pm, Quay Magnesium: $4.2m loss
6.16pm, Cockatoo Coal: $2.35m loss
6.59pm, Stirling Products: $15.3m loss
7.00pm, Globe Securities: $1.67m loss
7.01pm, Mikoh Corporation: $1.92m loss
7.02pm, Quantum Energy: $10.13m loss
7.02pm, Straits Resources: $106.7m loss
7.06pm, Cockatoo Ridge Wines: $54.8m loss
7.07pm, PanAust: $62m loss
7.07pm, Real Estate Capital Partners: $13.9m loss
7.09pm, Kagara Zinc: $49.9m loss
7.10pm, Cool or Cosy Total Comfort Solutions: $1.14m loss
7.13pm, Wallace Absolute Return Fund: $28.28m loss
7.13pm, Energy Ventures: $1.87m loss
7.17pm, NSX: $12.58m loss
7.21pm, Sino Strategic International: $3.1m loss
7.22pm, Payce Consolidated: $33.84m loss
7.27pm, Valad Property Group: $821m loss
7.28pm, Bentley International: $1.78m loss
7.33pm, Pacific Enviromin: $3.6m loss
7.39pm, EFTel Ltd: $1.72m loss
7.40pm, Centamin Egypt: $24.43m loss
7.40pm, Capitol Health: $1.1m loss
7.45pm, Orchid Capital: $2.1m loss
7.44pm, Tolhurst Group: $38.5m loss
February 20, 2009 at 8:27 am · Filed under Investor Relations, Australia
The turmoil within the top ranks of Rio Tinto has spillled out onto the front pages of the newspapers today. Shareholders are angered at management’s refusal to discuss the Chinalco deal and feel top-drawer assets are being sold at bottom-of-market prices. There’s lingering anger over the purchase price and terms for Alcan. And the deal with China’s state-run company wouldn’t be necessary if Rio Tinto hadn’t been so forceful rejecting all overtures from BHP Billiton.
Today’s The Australian reports that institutional shareholders do not support the Chinalco offer and may be seeking to oust CEO Albanese and Chairman Skinner. Said one:
“Shareholders have been more vocal against this deal than I’ve seen in a long time - it’s unusual to see people that active.”
Adding to their ire, shareholders have been unable to meet with CEO Tom Albanese. He’s also been forced to delay business trips as he seeks to deal with growing shareholder discontent.
Shareholder activism is a rarity in Australia. Individuals and institutions tend to accept the leadership of companies and rarely disagree. The majority of annual meeting proposals are accepted with a vast majority. Occasionally a block of disaffected shares will be voted against management but rarely do they override the company’s plans.
In Rio Tinto’s case the vast majority of shareholders are based in the UK - some 78% of the stock is held in Britain. So the upsets and outpourings reported down here are all the more unusual. We’re witnessing a glimpse of how other markets deal with belligerent management.
On-line journal “Crikey” founder Stephen Mayne is a one-person gadfly (individual shareholder activist). He has a diverse portfolio owning one share of most Australian companies. Like Charlie’s golden ticket to enter Willie Wonka’s factory, Mayne’s sole shareholding entitles him to enter annual meetings and query top management. He rides that single share for all it’s worth.
“The Mayne Report” chronicles one man’s journey to keep companies accountable to retail shareholders. It’s a valiant battle and one that may be like attacking paper tigers. The slashing and jousting may lead to nothing more than paper cuts.
But for all Stephen’s efforts the concept of shareholder activism is best raised when unrest at a company like Rio Tinto spills out into public. We’ll continue to watch this company and it’s battles as it sets the stage for change brought about by concerted shareholder action. Australia’s shareholders may be sleeping dragons but Rio Tinto CEO Tom Albanese looks to be the unlucky knight who woke this beast.
April 28, 2008 at 11:29 pm · Filed under Investor Relations
Mssrs Palter, Rehm and Shih at McKinsey offer an insightful analysis of investor behaviour in “Communicating with the Right Investors” (McKinsey on Finance, Number 27, Spring 2008). They break down investors into three categories: Intrinsic, Mechanical Investors and Traders.
Investor relations departments need to conduct a similar analysis of their shareholders to determine which make the most sense to focus on.
Both Mechanical Investors and Traders are influenced by figures - they buy and sell on specific financial models or short term news. Interaction with management will not influence their decisions. McKinsey says to relegate these to the investor relations department.
Intrinsic investors spend more time researching companies, and will want to understand from management their strategy. These investors probe deeply and stay for the longer term.
In short, IR departments need to segment their shareholders (existing and potential) and allocate management’s scarce time to investors in for the long term.
