I wasn’t on that conference call, but I did take a look at the transcript. http://www.nasdaq.com/symbol/kate/call-transcripts
It doesn’t make for light bedtime reading. What spooked investors was when CFO and COO George Carrara said that the company’s comparable sales growth for the second half of the year are expected to be in the high single-digit range – compared with an almost 30 percent increase in the first half of the year. Carrara also said the firm is considering putting off its profit margin targets for 2016 until 2017. Even though he explained this, citing several factors, investors weren’t sold. He got the tone wrong. The comments were misleading. Now the markets were questioning whether the company had a focussed growth strategy at all.
A more thought-through, rehearsed and confident presentation might have meant a very different trading day.
Giving a financial presentation can be tough. You know the form: the charismatic CEO steals the show from the start, revealing the juicy headlines figures and big ideas in opening remarks, before handing over to the numbers guy to wade through a usually dry slideshow of data, data and more data. Yet with a little practice and polish, those financial presentations will hold investors attention and keep them coming back for more.
Take a look at Roche’s Half Year Results 2014 webcast and conference call. http://www.roche.com/investors/ir_agenda/halfyear-2014.htm You’ll need to fast-forward to around 33 minutes in.
For a bit of context, analysts had forecast a small decline in sales and the week before, cross-town rival Novartis reported second-quarter results that fell slightly shy of forecasts. Roche’s results beat earnings forecasts. The firm confirmed full year sales and profit targets. Analysts described the results as solid. Yes, Hippe had good material to work with, but he had some complex stuff to get through. He did not get bogged down. He kept the tone upbeat and positive and framed his content in such a way that the firm’s focus was absolutely clear. His confidence, backed up with firm facts, was reassuring to investors.
Here are my tips to take away:
1. Set the tone
Hippe means business from the start. If he wanted the take-home message to be that things are going great and will continue that way, I think he nailed it. He smiles and his demeanour throughout the presentation is confident and relaxed. This guides the audience towards thinking positive. The language he uses is enthusiastic and upbeat. “Strong” core growth, free cash flow “significantly” improved. He says “good” several times during the presentation when he is moving on to the next salient point.
2. Set the scene
Hippe runs through the headlines and immediately says what he is going to do. This is a neat trick to hold the audience’s attention. Without getting too scientific, remember we all have a cycle of attentiveness. Listeners tune in and out, probably because they are thinking about some of the earlier points made. Hippe also repeats the key points at the end, reinforcing his outlook.
3. Know your numbers
It sounds like a no-brainer, but I have been in too many presentations where the CFO relies so heavily on a crowded slide show that I am left wondering whether he even had a chance to scan his notes beforehand. It is clear that Hippe knows his content inside out. I will bet he and his team rehearsed relentlessly. The more you rehearse, the more comfortable you will be with your content and the more conversational you will sound.
4. KISS (keep it simple, stupid)
Of course Hippe uses slides – it is after all a data-packed financial presentation. But the slides were not the star of the show. They supported what he had to say. One slide, which came up at the beginning and the end simply said “focus on cash” – that take-home message – leaving him to flesh out the details in a more conversational way. Later, there was a more complex slide crammed with numbers and a big -41% at the bottom of the chart.
Hippe draws attention to this immediately. “Don’t be irritated here by the minuses….” and briefly explains. “Look at it this way. Do the adjustment. It is a negative hit on operating profit but what this means for the second half is better momentum. Be careful when you do your predictions”. This direct approach dismisses any misunderstandings of the data and instills confidence in his knowledge and expertise. Taking it one step further, he says “let me give you more transparency” (yes, I know that is business-speak, but since English is not his first language I will let that one pass). “Here you see it, the comprehensive picture” – he demystifies the data and directs the audience to the numbers that he and the company think are important.
5. Prove it
Hippe reinforces his point, using his next slide to try out his theory by looking at sales, royalties and other operating income. Giving an example adds context and credibility to the numbers. Showing how the numbers work is incredibly valuable. If investors hadn’t got it yet, they had now.
6. Think ahead
Another clue that this presentation was well rehearsed and well prepared was when Hippe anticipated what his audience was thinking. “I heard already there were questions about the tax rate” he said, adding “it is a pretty straight story”. He then explained that the US award R&D tax credits, that so far, the 2014 has not been granted, but that since they had been awarded 15 years in a row, he was not worried. “It is not a big deal”. This is reassuring, not just because he is unconcerned, but because he had thought about potential curve ball questions beforehand. It shows he was well prepared. Always anticipate the questions or issues that might come up. This gives you time to figure out how to address them. When you do, don’t dwell on them and always finish on an upbeat note.
Be like Mr. Hippe. Look like someone who knows their numbers, who is in control and a safe pair of hands.
NB: Benjamin Ball Associates have not coached either of these CFOs, although we have worked with many others.
Download our free ebook to start your journey towards becoming a Powerful Presenter.
You’ll learn our 5-step process for transforming dull, forgettable and un-engaging presentations into your most Powerful Presentations yet: inspirational, memorable and persuasive.
It’s full of practical tips and insightful quotes that will help you make immediate improvements to your leadership talks and presentations, including:
Download your free copy of our Five Steps to Improve your Leadership Talks ebook now.
Fundraising presentations are hard work. You're bombarded with challenging questions from investors, worn out by long days, and struggling to...
Investment decision-making is not totally rational. Are you using all the tools at your disposal to create and deliver persuasive...
Do your public speaking skills inspire, motivate and influence others? They should. Many leaders are nervous of public speaking. Some...
A great investor pitch book is at the heart of successful fundraising. It should capture the essence of your business...
Better Body Language We all know that body language is important in business. But how important? And does is really...
How can you be seen as a top 1% fund by investors? At SuperReturn Emerging Markets in Amsterdam, experienced LPs...
A great elevator pitch is an essential part of your toolkit Last month I chaired the Quickfire Showcase at Berlin’s...
Better Media Interviews The excruciating Newsnight interview with Treasury Minister Chloe Smith this summer is just one example of how poor preparation...
These days, we are writing more than ever. That means it’s harder than ever to grab attention. Your readers have...
When an investor questions how you calculated your Private Equity fund's performance, how do you react? If an investor asks...
How do you choose a public speaking coach? When selecting a public speaking coach or presentation trainer, you want to work...
How To Harness Powerful Language For Leadership Communications Great leaders use Power Language to add interest and colour to what...
When you put your talk or presentation together, how do you decide what to include and what to leave out? Use...
What do LPs want from private equity funds at first investor meetings? That's the question I put to the panel...
While we wrote this piece with our Private Equity clients in mind, there are good lessons here for anyone pitching...
Do you want to give high impact talks and presentations? Do you want to engage your audience? And do you want...
Leaders use storytelling so that audiences listen, remember and act on what they say. In fact, stories are “the single...
How do you make your investment pitch more memorable? It's a real challenge these days. Investors have more opportunities than...
Your leadership talks need to be persuasive As a leader, every talk or presentation you give is an exercise in persuasion....
A well-crafted private equity pitch book can make the difference between securing a first meeting with investors and getting a...
Review our top coaching, advice and training programmes.
“The new presentation properly represents the institutional quality of our fund. It has been a step change of us.”
Erwin de Kleijn Head of IR, Saemor Capital
“This training has contributed directly to new business – including a new FTSE100 client.”
Michelle Elstein Head of Business Development, Olswang LLP
“BBA transformed our pitch into a compelling investment narrative. They undoubtedly helped us secure Sky TV as an investor.”
Gerry Bastable Director, Blast Films