Quarterly Earnings Call

After the earnings call season, this week we take a look back at the key points to ensure a successful earnings call, the advantages and disadvantages of different providers and the benefits of using video.

Key points for a successful earnings call:

1. Be prepared: make a list of possible questions (from FAQs to your IR team, analyst reports, questions last quarter, questions to peers etc.) and draft answers.
2. Select the right date and time for your earnings call so that it doesn’t clash with others in the same sector and you get the maximum analyst and investor attendance. To help with this, look at when your peers have held their earnings calls in the past.
3. Use a script and a presentation and rehearse. Rehearsing the script can make it sounds more natural.
4. Consider using video. (See below for more comments on using video for your earnings call).
5. Use a quiet room which does not produce an echo. If there is an echo consider adding soft furnishings or canvases to the room.
6. Use headphones and a microphone to improve sound quality – test to make sure you are close enough to hear your voice clearly, but not so close that you can hear breathing.
7. Do tests to check the internet connection and the sound and video quality and to familiarize yourselves with the technology/platform.
8. Talk with a strong voice, with clear diction and phrasing. Make sure your words have energy to hold the audience’s attention. Remember to breathe!
9. Answer ‘why’ sales increased and ‘how’ you reduced expenses etc.
10. Keep the prepared remarks to 15 minutes or less, communicating the top three messages you wish to deliver.
11. If you have a large number of questions then prioritize those from your most diligent analysts to reward them.
12. Publicize upcoming events e.g. your investor day.
13. Keep your earnings call to between 45-60 minutes in length, depending on market capitalization.
14. Ensure that there is a replay of the call available on your website as soon as possible.
15. Pay special attention to your analysts and major shareholders by setting up personal calls with them for after the earnings call to allow them to ask any additional questions and strengthen your relationship.
16. If possible get your CEO to join and lead the call. It’s a great opportunity to showcase him or her. Investors join the call to hear senior management and get to challenge them.  

Comparison of Conference Call Operators

Miranda Investor Relations has teamed up with ZOOM to be able to offer Mexican corporates an outstanding quarterly earnings call, via video or voice only, as the corporate prefers. We are more cost effective than most other providers, and provide our own operator (Emma, from England), who coordinates the call and questions. We prepare nice slides so that there is no blank or black space. Thanks to ZOOM, there is no long wait getting into the line, and you can access by video or voice, by computer, or phone, as you prefer. (See one pager attached for more information).

⁽¹⁾ Based on a call lasting approximately 40 minutes, with 50 participants (split between national and international dial in locations).

⁽²⁾ Issuer Direct, ViaVid and AudioWeb prices increase with call length, number of participants and number of international participants.

⁽³⁾ Including one-off initial fee of USD $365.

⁽⁴⁾ Price for a maximum of 100 participants. For 100-500 participants the price rises to USD $400.

*Zoom has brought in new security measures which puts it in line with the best security protocols in the business, including end to end encryption for all users.

Using video can be a great way to enhance your quarterly earnings calls and make them more engaging for analysts and investors. T-mobile is a good example of a company that uses video well in its earnings calls. Using video allows your executives to take advantage of using body language which accounts for an important part of communication.

Benefits of using video:

• Video allows you to use your body language as well as words to say “look at me and trust me” or “I’ve got this under control”, which can be particularly powerful after a bad quarter.
• Video allows greater connection with your investors and analysts.
• Reduced movement and face to face meetings as a result of Covid-19 has increased the importance of video. If your investors are local then it was less important in the past as you would often see them in person. A lot of investors in US companies are based in the US, but in Europe where there are more global investors, the use of video is much more common.
• In Europe there is also the desire for increased transparency, with ESG playing an important role.
• Video gives the feeling of a news bulletin rather than a radio broadcast.
• Everyone is waiting for the body language in response to the difficult question and video can help you to make this work in your favor with a confident response and body language.
• Investors invest in people, so show them your talent – use your earnings call as a PR and marketing tool.
• Using video positions your company as forward thinking and embracing today’s technology. Associate yourself with what is new, exciting and innovative, not what is old and stale.
• Using video makes the earnings calls more engaging and the additional option of allowing analysts and investors to turn their video on to ask questions can make them even more so.

The risk of trying something new can put companies off – it is easy to be conservative and keep to the habit of audio only conference calls. For more tips on how to use video on earnings calls, please contact our team and we would be happy to help with everything from lighting, to what color to we