Virtual roadshows – Not only during the pandemic a good addition
Wiesbaden, May 21, 2021. Since the Covid 19 pandemic at the latest, virtual roadshows have been the order of the day for board members, IR managers, investors and analysts. But even after the Corona crisis, they should be a permanent fixture in the IR calendar of listed companies – because they offer many advantages.
No disadvantages due to virtuality
Virtual roadshows are just a “nice meet & greet”? The experience of the Corona year 2020 proves otherwise: investors and analysts take virtual roadshows just as seriously as face-to-face exchanges – so investor meetings on the web have not lost any of their quality during the last year. The participants discuss the same “hard topics”: sales prospects, compliance with guidance, levers for margin optimization. Working capital, capital resources and corporate strategies are also discussed online. Virtual roadshows offer both investors and issuers a high level of added value in terms of content; after the online meetings, the company knows which topics are of concern to investors.
The dynamics of a virtual roadshow unfold just as they do in a face-to-face conversation. Either the conversation focuses on the company’s prepared presentation slides or on the list of questions brought along by the conversation partners. How long a virtual roadshow lasts depends on the people involved in the individual meetings. If management and investor have met recently, a short conversation is often sufficient. Conversely, an appointment can also drag on if there is a great need for discussion.
Flexible timing through roadshows online
One major advantage is that they can take place flexibly and at any time. Normally, companies come into direct contact with investors mainly at capital market conferences. The day is determined by the organizers – but for the issuer, this is not necessarily the optimal time for such a meeting. Particularly in special situations, such as dynamic transformation phases, but also in the case of special effects in the latest quarterly results that require explanation, it can make sense from the issuer’s point of view to seek discussions with investors promptly and not just when the next conference is coming up. Virtual meetings make this possible.
This scheduling flexibility also increases the chance of talking to one’s own preferred investors, e.g. investors from peer group companies or ESG investors. In addition to the investor’s fundamental interest in conversation, three factors must come together for a meeting to take place in person at capital market conferences:
- 1. Investor and issuer must both attend the respective conference.
- 2. For multi-day conferences, both must be on site on the same date.
- 3. An appropriate time slot must be available in both sides’ one-on-one plans.
When arranging a virtual meeting, it is much easier to find a suitable date for both parties.
Virtual roadshows: not a passing trend
Two other aspects speak in favor of companies regularly including virtual roadshow dates in their annual IR schedule in the future: cost and time efficiency. For issuers, participation in German capital market conferences usually involves travel time, at least one full day on site, travel expenses and possibly accommodation costs. It is even more time-consuming and cost-intensive to meet in person with international investors – whether within Europe, in North America or Asia. With a virtual implementation, issuers therefore save time and money. This also protects the environment, as emissions can be saved and short business trips can be avoided on the part of companies and investors. Despite time differences of six to nine hours, a suitable time for the online meetings can be found for all parties involved. For example, meetings with Asian investment houses can take place in the morning and meetings with investors from the U.S. East Coast in the afternoon.
Of course, it is nevertheless clear that face-to-face meetings are always of non-negligible importance for building and maintaining a long-term relationship of trust between companies and investors. But virtual roadshows should also have a fixed place in IR annual planning in the future. On the one hand, they can improve the international visibility of a listed company on the capital market, and on the other, they make the maintenance and development of contacts even more efficient.
cometis has already gained a lot of experience in dealing with virtual roadshows. We are happy to support your company in planning and implementing the online meetings. You can find more information here.
Georg Grießmann: Senior Consultant
Georg Grießmann worked in the controlling department of an international IT service company for many years. The focus of his work was the preparation of financial reports, key figure analyses and the preparation of management reports.