Interim Reports – the unintended consequences

28 May 2019 by Mike Tisdall

So, listed companies no longer need to publish an Interim Report. Great: less work, less cost.

But if that means you’re communicating with your retail shareholders and other stakeholders at only 12 month intervals, then Houston, I think we have a problem.

How big the problem is depends a bit on your share register: instos vs retail shareholders. You’re no doubt talking to your institutional shareholders regularly – they’re probably making sure you are. But for retail shareholders, a year’s gulf can be very wide. Absence probably does the very opposite of making the heart grow fonder.

Radio silence equates to ‘don’t really care’. It disengages. It risks halting loyalty. They may not back you when you suddenly need their support. Or they may not hold their shares.

It can lead to ignorance - your shareholders not keeping up with the exciting things you’re doing. And if they don’t keep up, the share price may not either.

If those are the unintended consequence of dropping the interim report, what can be done to mitigate the downsides?

Find another way to talk to them mid year or more often . . .

Keep the communication lines open in one way or another: keep sending the interim report is one option. But others include sending the report without financials. Or a newsletter. Or a newsy magazine. And those are the physical ways if you don’t care for trees that much.

But an email newsletter is probably your best avenue. That way you can communicate to all selected stakeholders, not just shareholders. And you get to talk to all your shareholders, not just those very few who have opted in to receive your report in the past. An email newsletter can engage pretty well if it’s crafted by someone who knows about messaging and design. The trick is to get your headline messages across in the email directly, and provide secondary and support messages with links to fuller stories on your website for those whose curiosity you’ve managed to pique.

clips of various results announcements email newsletters

Can’t really do the above without a quality email database of course, so you may need to negotiate hard with your share registry to obtain what you need. Or they may offer to organise the mailing for you. But in that case, I strongly recommend you take strict control of the messaging, design and html building rather than leave it to them . . . horses for courses.

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