Future of Global IR Presentation for the 2010 IRGR North America Workshop & Award Ceremony

8/9/2019 Future of Global IR Presentation for the 2010 IRGR North America Workshop & Award Ceremony

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WWW.CCGIR.COMNew York So Paolo Los Angeles San Francisco Beijing Shanghai Hong Kong Tel Aviv Frankfurt

Future of Global IRNew York, April 2010


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IR Trends for 2010

1. Growing interestin emerging

markets

2. Globalization of capitalmarkets accelerates

6. Emergence of empoweredretail investors

2


20103. Sharp divisionbetween owners

and traders4. Public equity

issuance reachingrecord levels

5. Sell-side under

increased stress


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1. Benefits from Growing Interest in Emerging Markets

Emerging markets are active ADRissuers

Emerging markets equities and fixed

income products have replaced flowsinto U.S. equities

Fund Flows

ADRs per Region

3


-31%

16%

46%

-40%

-30%

-20%

-10%

0%10%

20%

30%

40%

50%

U.S. Equities Emerging

Market

Equities

Fixed Income

Assets

YTD as of Nov 2009

. . .

and Fixed Income Products)China, 9.8%

Australia +

NZ, 9.5%

Europe (exUK and

Ireland),

28.8%

Other, 4.7%

Asia (ex

China,

Australia

and NZ),

27.1%

Latin

America (exBrazil),

4.9%

Brazil, 3.8%

UK +

Ireland,

11.3%

Data: BNY Mellon, as of April 2010


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Added Performance from Emerging Markets

Russia Brazil

April 2009 April 2010

4


India

Shanghai

S&P 500

Russel 2000


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Optimal Approach to Global Investor Targeting

U.S.-based investors:

Mutual funds, pension funds,hedge funds, insurancecompanies, managed accounts,asset managers, banks

Pipeline to new sources of Asian

capital Sovereign wealth funds, private

equity investors, QDIIs, Asia-basedmutual funds & investment advisors

5


Investor influencers:

Sell-side research, industryanalysts, investment advisors,

investment banks, institutionalsales, retail brokers, media


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2. Globalization of Capital Markets Accelerates

Emerging Markets have attained a relevant position among global markets

Chinas foreign reserves increasingly deployed into equities, real estate & otherasset classes

2,500

Foreign Reserves of Selected Countries (2009)$ billion

6


,

1,042

567 401 325 271 245 218 175

0

500

1,000

1,500

2,000

China Japan EU Russia Taiwan India South

Korea

Hong

Kong

Brazil

IMF & ECB


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Equity Ownership Trends: Foreign Holdings

U.S. Portfolio Holdings of Foreign Equities

5000

6000

20%

25%

Total $2.7 trillion 2008,18.1% of total equities

The decrease in thevalue of U.S. portfolio

$ billion

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0

1000

2000

3000

2001 2003 2004 2005 2006 2007 2008

0%

5%

10%

15%

two surveys primarilyreflects valuationchanges in foreignequities during 2008

Foreign Equity as

% of U.S. Portfolios

Sources: U.S. Treasury

Federal ReserveValue of foreign equity in

U.S. Portfolios


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Managing Growing Global Shareholder Base

Traditional

U.S. & Euro ean mutual

New

Industr -focused funds

Strategic approach to managing growing global shareholder base

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funds, investment advisors,& hedge funds

Emerging markets funds

investing world wide

Asian mutual funds &

investment advisors

QDIIs in the PRC U.S. retail investors


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3. Owners Vs. Traders

Growth of high-frequency

trading

Dark pool of off-market

transactions

62%

31%

8%

0%

20%

40%

60%

80%

Low Mod High

Ownership Turnover

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Sell side focused on short termhedge funds and traders

Long-only mutual funds &

investment advisors require

minimum five points of contact

before reaching to a decision GARP, 20%

Value, 23%

Growth,

23%

Other, 12%

Hedging,2%

Index, 21%

Yield, 0%

Top 25 NASDAQ listed companies

(based on market cap)


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The Lost Decade

S&P 500Russel 2000

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Buy and hold strategies discredited by a decade of negative results

NASDAQ Comp


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4. Public Equity Issuance

2009 was an excellent year for PIPEs and Registered Direct offerings

$1.4

Registered direct offerings in 2009 Unregistered direct offerings in 2009

$1 185$1,400

$ Billion$ Billion

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$0.1

$0.3

$0.9

$0.3

$1.2

$0.6

$0.8

$0.6$0.7

$0.1$0.2

$0.0

$0.0

$0.2

$0.4

$0.6

$0.8

$1.0$1.2

Jan

Feb

Mar Ap

rM

ay Jun Ju

lAu

gSe

pOc

tNo

vDe

c

$17

$202$140$103

$308

$912

$338

$588

$779

$596$688

$0

$200

$400

$600

$800

$1,000

$1,200

Jan

Feb

Mar

AprMa

yJu

n JulAu

gSe

pOc

tNo

vDe

c

Total $5.9 billion Total $37.1 billion


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5. Sell-side Under Increased Stress

Buy-side firms increasingly rely

on internal research, expertnetworks & bespoke research

Retail investors emphasize

individual anal sis and due# of Sell-Side Analysts

Reduction of number of sell-side

analysts since 2000, coverage onsmall-cap stocks has suffered

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diligence for investmentdecisions

Companies with transparent

reporting practices and

frequent news are rewardedwith liquidity and higher share

price

16,000

6,0003,000

0

5,000

10,000

15,000

20,000

2000 2007 2009

Source: Ernst & Young


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Multifaceted Approach to Investor Influencing

Tremendous turnover creates

opportunities for versatile

initiation

Proliferation of boutique sell-

side firms (incl. bespoke

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research), increasedinfluence of expert networks

that have to be monitored

and managed

Electronic stockcommentators & newsletters

wield significant influence


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Retail equity ownership close to $5 Trillion

90 million retail investors

$ billion

6. Emergence of Empowered Retail Investors

46%

23%31%31%

6,000

7,000

8,000

9,000

0.3

0.35

0.4

0.45

0.5

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Resurgence of retail investors after the global financial crisis?

Source: Federal Reserve

Retail equity ownership

Retail equity ownership as % of total equity ownership

0

1,000

2,000

3,0004,000

,

2000 2001 2002 2003 2004 2005 2006 2007 2008

0

0.05

0.1

0.15

0.2

0.25


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Five Phases of Retail Strategies

5. Retail-Focused Road Shows:

Targeted retail investment communication connects the right investors with theright stock by offering high-quality content and services using Web 2.0technology as an enabling platform

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Engagement Relevance Interaction

4. Social Media

3. Online marketing campaigns

2. Database Creation

1. Engaging website

Retail Brokers and VirtualCommunities


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Utilize Twitter, Facebookand RSS feeds to allowinterested arties to

Upload investor presentationwith audio and corporaterofile and include link in

Leverage existing onlineinvestor communities, suchas blo s, investor

News Feeds andNetworking

Utilize SharingPlatforms

Virtual Investor

Communities

Social Media Applications for IR

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subscribe to your investorcommunications

Tweet press releaseheadlines, conference call

dial-in information, updatesfrom analyst days, andother public information

presentation materials

YouTube, Slide Share

Social media improves SOE rankings and helps direct traffic to the corporate website

newsletters, and financialportals, to build investorrecognition and to encouragemedia coverage.

SeekingAlpha, Motley Fool


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Why Social Media Matters

Encourages Dialogue Technology Drives GreaterTransparency

Two way communications allows the companyto gauge the opinion of the investmentcommunity

Opt-in features guarantee a receptive audience

Utilize feedback to adjust future

Online presence levels the playing field

Lower barriers to obtain information; increasestransparency of communications

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Multiple Channels Reinforce the CoreMessage

High ROI Strategy

communications

Helps establish a broader presence and reachpreviously untapped audiences

Helps reinforce message created and endorsedby the Company

Complements existing IR strategies

Limited costs Potentially priceless benefits from increased

shareholder base, more transparency, feedbackfrom the investment community, and improvedbrand perception


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Summary

Take your IR efforts global think outside your comfort zones

Identify distinct groups of shareholders and develop an arsenalof different strategies for targeting them

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Nurture your sell-side connections, but remember alternativesfor influencing buying decisions

Utilize newsletters, online push campaigns, E-mail blasts, and

social media to entice retail investors


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Thank You!

Future of Global IR Presentation for the 2010 IRGR North America Workshop & Award Ceremony

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Transcript of Future of Global IR Presentation for the 2010 IRGR North America Workshop & Award Ceremony