Spotlight on a top IR team: Hugo Boss
Dennis Weber, head of IR for Hugo Boss, scooped the award for best investor relations officer (small & mid-cap) at the IR Magazine Awards – Europe 2017. Here, he gives us an insight into IR, the Hugo Boss way.
Describe your event schedule over the past 12 months.
We conducted 22 roadshows and attended 13 investor conferences in 2017, some of them over several days. In addition, we held numerous conference calls and had more than 15 site visits, so investors or groups of investors were visiting our company headquarters, retail stores and other operating facilities such as distribution centers.
The clear highlight in 2017, however, was our investor day at the beginning of August, where we gave an update on group strategy including tours through our collection showrooms, guided by our creative management, as well as a presentation of our new store concept led by retail management.
What are the most popular investor queries right now?
One of the most popular questions at the moment is: are you worried there are fewer and fewer people wearing suits today? It tends to be particularly funny when asked by a group of investors sitting around the table all wearing suits and ties! Joking aside, the question allows us to highlight our strength in casualwear and athleisure and to explain how we reinterpret formalwear to cater to smart-casual dress codes.
How does your team use technology and social media to convey IR messages?
From my perspective, company websites continue to be the most important digital touchpoint with investors. That’s why we focus a lot on making sure we offer relevant and comprehensive information, especially to those who are new to our equity story. In our daily IR work, we use a Bloomberg terminal to monitor trading in our share and follow the news flow on our industry. Finally, a specialized investor relations tool helps us to identify current and potential investors and to track our interactions with the buy side. We also looked into the potential of social media, but at the moment we don’t use it for IR purposes and nobody seems to miss it.
What are your current and future IR challenges?
In the short term, understanding the impact of Mifid II and what it means for the relationship between companies and investors is definitely the biggest challenge. Building strong relationships with the buy side will be even more important in the future. We also expect passive investment strategies to attract even more funds going forward – it will be interesting to see what implications this will have on companies.
Apparently, there are investment strategies already in place that are based on natural language processing, which involves teaching machines to understand the nuances of human language used in quarterly analyst conference calls. In the future, IR will be challenged to cater to at least partially automated investment processes, too.
What is the one hot topic at the moment?
Apart from company-specific topics, I perceive Mifid II as the one hot topic in the IR industry at the moment. But given that we have a very large number of analysts covering us (34 currently) and that sell-side demand for roadshows with us is as high as ever, I don’t expect any significant impact on us, at least in the short term. Nonetheless, we will monitor the implications of Mifid II implementation very closely.
What, if anything, does your team do differently from others? What makes it so successful?
We are a well-rounded team with a good mix of talents and experience in different areas, gained inside and outside of Hugo Boss. Most importantly, though, we get a lot of support from a number of people within the organization, starting with the managing board, which involves us very closely in its thinking and decision-making processes, as well as senior management in central functions and the markets. This allows us to talk credibly about our strategy and outlook. In addition, it helps us to set up value-adding events such as our annual investor day, which regularly involves colleagues from all over the organization.
What top practical tips would you like to share with other IR teams?
Make sure IR is seen as an important function worth sharing information with internally, so that you can effectively communicate externally. In this context, having a good understanding of market trends and your competitors’ actions has proven to be enormously valuable, because it allows IROs to generate value not just for investors and analysts but also for people within their own organization who benefit from the insight.
What are you most looking forward to terms of future IR activity?
The constant change in the company’s business models and the way investment decisions are being made will never allow IR professionals to stand still. That is what makes IR such an exciting profession.
What is your biggest IR success?
Hugo Boss had a difficult period in 2016, marked by a disappointing financial performance, a number of management changes and the recalibration of strategy. As a result, investor sentiment was very negative. Nonetheless, we did not hide away but increased our investor outreach activities in order to face all concerns head-on. In hindsight, this was key to rebuilding trust in the company and our equity story.