IFR Market Intelligence | Pan-European Investor Relations Review

Executive summary
Chapter 01 - Introduction
Chapter 02 - Market size and distribution
Chapter 03 - The use of IR by quoted companies
Chapter 04 - Stock performance and IR performance – is there proof that IR works?
Chapter 05 - The criteria for success
Chapter 06 - Buyside and sellside perspectives
Chapter 07 - History and the future
Appendix 01 – Geographical and sector analyses
Appendix 02 - The 2006 Thomson Extel Pan-European Survey
List of figures
List of tables

Executive summary

The report
Market size and distribution
The use of IR by quoted companies
Stock performance and IR performance – is there proof that IR works?
Criteria for IR success
Buyside and sellside perspectives
History and future
Geographical and sector analyses
Methodology

Chapter 01 - Introduction

Key statistics
Buyside
Sellside
Quoted companies
The IR professionals’ view
Communication with investors
The way IR teams work Investors’ opinion
Stock performance and IR performance – is there proof that IR works?
The Extel performance measure
Key observations and opportunities
Senior management responsibility, IR and corporate thinking
Consistency and the longterm process of building reputation
Making the most of meeting investors
The investment industry and the growth in the role and stature of the IR profession
Compliance and disclosure
Building an atmosphere of trust

Chapter 02 - Market size and distribution

Buyside
Sellside
Quoted companies
Professional viewpoint: Lene Aabo, Senior Director of Investor Relations, Novozymes,
Biotechnology sector

Chapter 03 - The use of IR by quoted companies

Communication with investors
Evaluating the tools
Market interaction
Key performance indicators
Measuring the effectiveness of IR activity
Working with the buy and sellsides
The buyside
What quoted companies want from the buyside
Hedge funds
The sellside
Comparing the buyside and the sellside
The way IR teams are working
Budget size and spending
Country breakdown
Sector breakdown
IR department responsibility and influence
Reporting lines
Who are the best investors to work with?
Professional viewpoint: Chris Hollis, Director of Financial Communications, LVMH, Luxury Goods sector
The impact of hedge funds
Working with the buyside/sellside
Changes in IR practice
Disclosure and regulation
In summary

Chapter 04 - Stock performance and IR performance – is there proof that IR works?

Performance considerations
The effect of company IR professionals
The influence of share performance
The study
Consistent performers
The Extel IR Stars
Performers of the future
Professional viewpoint:
Stefan Gruber, Head of Investor Relations, SAP, Software and IT sector
IR: A ‘glocal’ approach
Senior management buy-in
SAP’s relationship with buy and sellside
Importance of intelligent resource allocation
The well-rounded and consistent IR team
Summary

Chapter 05 - The criteria for success

Consistency and transparency
Quality of IR service
Quality of non-deal roadshows and visits
Proactivity of senior executives
Formal disclosure
Quality of one-to-one meetings
Business knowledge/insights from the IR team
Professional viewpoint:
Amanda Jones, Head of Investor Relations, The British Land Company PLC, Real Estate sector
Developments and improvements in IR practice
Regulation and disclosure
The importance of IR to The
British Land Company PLC

Chapter 06 - Buyside and sellside perspectives

Buyside perspectives
CEO/CFO meetings
IR team meetings
Extra-financial guidance
Financial key performance indicators (KPIs)
Business-specific KPIs
Business/divisional director meetings
Ways companies can best return cash to investors
The effects of transition to IFRS
Reliability of IFRS
Relevance of IFRS
Comparability of IFRS
Buyside needs and expectations
Sellside perspectives
Research
Corporate access
The sellside view of quoted companies and IR
Professional viewpoint: Bob Kinsella, Investor Relations Manager, Munich Re Group, Insurance sector

Chapter 07 - History and the future

An historical view
Company participation and inclusion
The UK and continental
European paths
The future
Professional viewpoint: Christian Feilmeier, former Head of Investor Relations, BMW
Group, Autos and Automotive Components sector

Appendix 01 – Geographical and sector analyses

Geographical distribution of sellside firms – sector by sector
Geographical distribution of sellside analysts – sector by sector
Geographical distribution of quoted companies – sector by sector
Geographical distribution of quoted company individuals – sector by sector

Appendix 02 - The 2006 Thomson Extel Pan-European Survey

Methodology
Timings
Validation
Fund management vote weighting
Brokerage vote weighting
Quoted company vote weighting

List of tables

Table 2.1: European equity assets under management – Geographical distribution, 2006 (US$bn, %)
Table 2.2: European equity assets under management, by fund type, 2006 (US$bn, %)
Table 2.3: Geographical breakdown of assets under management of Thomson Extel Pan-European Survey 2006 voters (%)
Table 3.1: Annual IR budget, 2006 (US$)
Table 3.2: IR budgets and spending, Europe, 2006 (US$,%)
Table 3.3: IR budgets, spending and teams, by sector, 2006 (US$, %)
Table 3.4: Institutional investment firms, rated for their performance in interaction with quoted companies (Ranked 1–5)
Table 3.5: Buyside firms nominated by quoted companies for best ongoing feedback (%)
Table 3.6: Buyside firms nominated by quoted companies for best one-on-one preparation (%)
Table 3.7: Buyside firms nominated by quoted companies for best quality of questions (%)
Table 3.8: Buyside firms nominated by quoted companies for best understanding of companies’ business (%)
Table 4.1: Consistently high Extel-rated IR performers, 2003–06 (%)
Table 4.2: Extel IR Stars – fiveyear stock performance (%)
Table 4.3: Companies ranked 1st or 2nd in their sector in both 2005 and 2006 (%)
Table 6.1: Quoted companies – Ratings for IR consistency and transparency, 2004–06
Table 6.2: Quoted companies – Ratings for IR service, 2004–06
Table 6.3: Quoted companies – Ratings for IR non-deal roadshows/visits, 2004–06
Table 6.4: Quoted companies – Ratings for IR proactivity of senior executives, 2004–06
Table 6.5: Quoted companies – Ratings for IR formal disclosure, 2004–06
Table 7.1: Top quoted company in Europe for IR, 2000–06
Table A1: Pan-European top brokerage firms by sector, 2006
Table A2:1 Standard funds weighting (US$bn)
Table A2:2 Results for brokerage firms in 2005 Extel survey ranking position
Table A2:3 Quoted company vote weighting

List of figures

Figure 2.1: Buyside firms – Pan- European aggregate distribution, by country, 2006 (%)
Figure 2.2: Buyside individuals – Pan-European aggregate distribution, by country, 2006 (%)
Figure 2.3: Sellside firms – Pan- European aggregate distribution, by country, 2006 (%
Figure 2.4: Sellside analysts – Pan-European aggregate distribution, by country, 2006 (%)
Figure 2.5: Quoted companies – Pan-European aggregate distribution, by country, 2006 (%)
Figure 2.6: Quoted company individuals – Pan-European aggregate distribution, by country, 2006 (%)
Figure 3.1: Importance of IR components (%)
Figure 3.2: Frequency of market interaction with divisional directors (%)
Figure 3.3: Importance of quarterly reporting to quoted companies (%)
Figure 3.4: The importance of key performance indicators (%)
Figure 3.5: How companies measure their own IR performance (%)
Figure 3.6: The value of methods of buyside contact (%)
Figure 3.7: What quoted companies want from the buyside (%)
Figure 3.8: Hedge funds – Quoted companies’ view (%)
Figure 3.9: Ways the sellside communicates – IR Professionals view
Figure 3.10: The value of types of sellside analysis (%)
Figure 3.11: Importance of IR department responsibilities (%)
Figure 6.1: What the buyside value from quoted companies (%)
Figure 6.2: Buyside preference in ways to return cash to investors (%)
Figure 6.3: Industry view of the degree of change caused by the transition to IFRS (%)
Figure 6.4: Industry view on the difficulty of communicating the effects of IFRS (%)
Figure 6.5: Industry view on the reliability of IFRS (%)
Figure 6.6: Industry view on the relevance of IFRS (%)
Figure 6.7: Industry view on the comparability of IFRS (%)
Figure A1: Sellside firms in Aerospace & Defence, by country (%)
Figure A2: Sellside firms in Autos & Automotive Components, by country (%)
Figure A3: Sellside firms in Banks, by country (%)
Figure A4: Sellside firms in Beverages, by country (%)
Figure A5: Sellside firms in Biotechnology, by country (%)
Figure A6: Sellside firms in Capital Goods (inc. Engineering & Machinery), by country (%)
Figure A7: Sellside firms in Chemicals, by country (%)
Figure A8: Sellside firms in Construction & Building, by country (%)
Figure A9: Sellside firms in Food Manufacturers, by country (%)
Figure A10: Sellside firms in Forestry, Paper & Packaging, by country (%)
Figure A11: Sellside firms in Household Products & Personal Care, by country (%)
Figure A12: Sellside firms in Insurance, by country (%)
Figure A13: Sellside firms in Leisure, Entertainment & Hotels, by country (%)
Figure A14: Sellside firms in Luxury Goods, by country (%)
Figure A15: Sellside firms in Media, by country (%)
Figure A16: Sellside firms in MedTech & Services, by country (%)Figure A17: Sellside firms in Metals & Mining, by country (%)
Figure A18: Sellside firms in Oil & Gas, by country (%)
Figure A19: Sellside firms in Pharmaceuticals, by country (%)
Figure A20: Sellside firms in Real Estate, by country (%)
Figure A21: Sellside firms in Retailers (Food), by country (%)
Figure A22: Sellside firms in Retailers (Non-food), by country (%)
Figure A23: Sellside firms in Semiconductors, by country (%)
Figure A24: Sellside firms in Software & IT Services, by country (%)
Figure A25: Sellside firms in Speciality & Other Finance, by country (%)Figure A26: Sellside firms in Support & Business Services, by country (%)
Figure A27: Sellside firms in Telecommunications Equipment & IT Hardware, by country (%)
Figure A28: Sellside firms in Telecommunications Services, by country (%)
Figure A29: Sellside firms in Tobacco, by country (%)
Figure A30: Sellside firms in Transport, by country (%)
Figure A31: Sellside firms in Utilities, by country (%)Figure A32: Sellside analysts in Aerospace & Defence, by country (%)
Figure A33: Sellside analysts in Autos & Automotive Components, by country (%)
Figure A34: Sellside analysts in Banks, by country (%)
Figure A35: Sellside analysts in Beverages, by country (%)
Figure A36: Sellside analysts in Biotechnology, by country (%)
Figure A37: Sellside analysts in Capital Goods (inc. Engineering & Machinery) , by country (%)
Figure A38: Sellside analysts in Chemicals, by country (%)
Figure A39: Sellside analysts in Construction & Building, by country (%)
Figure A40: Sellside analysts in Food Manufacturers, by country (%)
Figure A41: Sellside analysts in Forestry, Paper & Packaging, by country (%)
Figure A42: Sellside analysts in Household Products & Personal Care, by country (%)
Figure A43: Sellside analysts in Insurance, by country (%)
Figure A44: Sellside analysts in Leisure, Entertainment & Hotels, by country (%)
Figure A45: Sellside analysts in Luxury Goods, by country (%)
Figure A46: Sellside analysts in Media, by country (%)
Figure A47: Sellside analysts in MedTech & Services, by country (%)
Figure A48: Sellside analysts in Metals & Mining, by country (%)
Figure A49: Sellside analysts in Oil & Gas, by country (%)
Figure A50: Sellside analysts in Pharmaceuticals, by country (%)
Figure A51: Sellside analysts in Real Estate, by country (%)
Figure A52: Sellside analysts in Retailers (Food), by country (%)
Figure A53: Sellside analysts in Retailers (Non-food), by country (%)
Figure A54: Sellside analysts in Semiconductors, by country (%)
Figure A55: Sellside analysts in Software & IT Services, by country (%)
Figure A56: Sellside analysts in Speciality & Other Finance, by country (%)
Figure A57: Sellside analysts in Support & Business Services, by country (%)
Figure A58: Sellside analysts in Telecommunications Equipment & IT Hardware, by country (%)
Figure A59: Sellside analysts in Telecommunications Services, by country (%)
Figure A60: Sellside analysts in Tobacco, by country (%)
Figure A61: Sellside analysts in Transport, by country (%)
Figure A62: Sellside analysts in Utilities, by country (%)
Figure A63: Quoted companies in Aerospace & Defence, by country (%)
Figure A64: Quoted companies in Autos & Automotive Components, by country (%)
Figure A65: Quoted companies in Banks, by country (%)
Figure A66: Quoted companies in Beverages, by country (%)
Figure A67: Quoted companies in Biotechnology, by country (%)
Figure A68: Quoted companies in Capital Goods (inc. Engineering & Machinery) , by country (%)
Figure A69: Quoted companies in Chemicals, by country (%)
Figure A70: Quoted companies in Construction & Building, by country (%)
Figure A71: Quoted companies in Food Manufacturers, by country (%)
Figure A72: Quoted companies in Forestry, Paper & Packaging, by country (%)
Figure A73: Quoted companies in Household Products & Personal Care, by country (%)
Figure A74: Quoted companies in Insurance, by country (%)
Figure A75: Quoted companies in Leisure, Entertainment & Hotels, by country (%)
Figure A76: Quoted companies in Luxury Goods, by country (%)
Figure A77: Quoted companies in Media, by country (%)
Figure A78: Quoted companies in MedTech & Services, by country (%)
Figure A79: Quoted companies in Metals & Mining, by country (%)
Figure A80: Quoted companies in Oil & Gas, by country (%)
Figure A81: Quoted companies in Pharmaceuticals, by country (%)
Figure A82: Quoted companies in Real Estate, by country (%) Figure A83: Quoted companies in Retailers (Food), by country (%)
Figure A84: Quoted companies in Retailers (Non-food), by country (%)
Figure A85: Quoted companies in Semiconductors, by country (%)
Figure A86: Quoted companies in Software & IT Services, by country (%)
Figure A87: Quoted companies in Speciality & Other Finance, by country (%)
Figure A88: Quoted companies in Support & Business Services, by country (%)
Figure A89: Quoted companies in Telecommunications Equipment & IT Hardware, by country (%)
Figure A90: Quoted companies in Telecommunications Services, by country (%)
Figure A91: Quoted companies in Tobacco, by country (%)
Figure A92: Quoted companies in Transport, by country (%)
Figure A93: Quoted companies in Utilities, by country (%)
Figure A94: Quoted company individuals in Aerospace & Defence, by country (%)
Figure A95: Quoted company individuals in Autos & Automotive Components, by country (%)
Figure A96: Quoted company individuals in Banks, by country (%)
Figure A97: Quoted company individuals in Beverages, by country (%)
Figure A98: Quoted company individuals in Biotechnology, by country (%)
Figure A99: Quoted company individuals in Capital Goods (inc. Engineering & Machinery) , by country (%)
Figure A100: Quoted company individuals in Chemicals, by country (%)
Figure A101: Quoted company individuals in Construction & Building, by country (%)
Figure A102: Quoted company individuals in Food Manufacturers, by country (%)
Figure A103: Quoted company individuals in Forestry, Paper & Packaging, by country (%)
Figure A104: Quoted company individuals in Household Products & Personal Care, by country (%)
Figure A105: Quoted company individuals in Insurance, by country (%)
Figure A106: Quoted company individuals in Leisure, Entertainment & Hotels, by country (%)
Figure A107: Quoted company individuals in Luxury Goods, by country (%)
Figure A108: Quoted company individuals in Media, by country (%)
Figure A109: Quoted company individuals in MedTech & Services, by country (%)
Figure A110: Quoted company individuals in Metals & Mining, by country (%)
Figure A111: Quoted company individuals in Oil & Gas, by country (%)Figure A112: Quoted company individuals in Pharmaceuticals, by country (%)
Figure A113: Quoted company individuals in Real Estate, by country (%)
Figure A114: Quoted company individuals in Retailers (Food), by country (%)
Figure A115: Quoted company individuals in Retailers (Nonfood), by country (%)
Figure A116: Quoted company individuals in Semiconductors, by country (%)
Figure A117: Quoted company individuals in Software & IT Services, by country (%)
Figure A118: Quoted company individuals in Speciality & Other Finance, by country (%)
Figure A119: Quoted company individuals in Support & Business Services, by country (%)
Figure A120: Quoted company individuals in Telecommunications Equipment & IT Hardware, by country (%)
Figure A121: Quoted company individuals in Telecommunications Services, by country (%)
Figure A122: Quoted company individuals in Tobacco, by country (%)
Figure A123: Quoted company individuals in Transport, by country (%)
Figure A124: Quoted company individuals in Utilities, by country (%)

Reports

CONTENTS

Executive summary

Chapter 01 - Introduction

Chapter 02 - Market size and distribution

Chapter 03 - The use of IR by quoted companies

Chapter 04 - Stock performance and IR performance – is there proof that IR works?

Chapter 05 - The criteria for success

Chapter 06 - Buyside and sellside perspectives

Chapter 07 - History and the future

Appendix 01 – Geographical and sector analyses

Appendix 02 - The 2006 Thomson Extel Pan-European Survey

List of tables

List of figures