IR Monitor – 14 May 2025

In this week’s newsletter:

• Baffled by the Trump tariffs, C.E.O.s Lean on the Word ‘Uncertainty’. With little ability to see how far the Trump administration is taking its disruptive policies, companies and investors both face higher risks says the New York Times 
• A case study in financial communications: Why can’t more financial heavyweights write letters like Warren Buffett?  asks the Financial Times
• Ross Hawley on the AI spectrum for IR  
• Sharp rise in profit warnings on London markets: the 24% increase in April followed a fall in the previous three months, reports The Times 
• The Harvard Business Review on how to get celebrity investors to back your business 
• And finally … AI avatar of CEO delivers annual results in first for LSE reports City AM 

This week’s news

CEOs are leaning on the word ‘uncertainty’ says New York Times

Companies are resorting to suspended guidance and baffling investors with a lack of clarity about future performance following Trump’s all too frequent tariff updates, according to the NY Times. 87% of earnings calls used the word ‘uncertain’ whilst describing future performance, and companies are expressing a mutual need for the government’s confirmed plans to conduct market assessments. Firms across industries, from automotive to technology, are basing projections and plans on minimal information, making it a confusing time for investors and executives alike.  

Why can’t more executives write letters like Warren Buffet? 

Buffett’s retirement from Berkshire Hathaway calls for executives to carry on his legacy of honest, charming and jargon-free letters to investors. Although executives continue to remain strategic and perceptive, Buffett’s ability to admit to his shortcomings built a sense of trust between him and his shareholders that has kept them invested. It is difficult to separate Buffett from his letters, and in a world of formalities and prescriptiveness, his confessions, wit and personality will be sorely missed.  

AI and IR

In his LinkedIn post, Deputy Chair of IR Society Ross Hawley maps out the vast array of AI tools and software platforms being utilised by IR professionals both internally and externally to illustrate the increasing use of automated intelligence in the industry. He pinpoints AI use in financial consolidation systems to quickly assess financial performance or trends internally as well as investors using AI to gather company information and prepare questions for meetings with management. His chart is just the tip of the iceberg in the mobilisation of AI in the IR space. 

Increasing profit warnings in London

According to research reported in The Times, 26 UK-listed companies warned that earnings would fall short this year, a 24% jump over April 2024. Half of companies pointed to economic disruption from the White House and the spectre of new trade barriers. The uptick follows three calmer months and comes in the wake of the so called “liberation day”, which rattled markets, IPOs and M&A activity. Moreover, on average, companies issuing these warnings saw their share prices drop 19% in a single day. EY’s Jo Robinson said the Q1 calm, where profit warnings declined by 11% YoY, now feels like “a different era,” as once-manageable risks are being magnified by politics and economic fallout. The number of April profit alerts typically averages 19 (excluding the pandemic), highlighting the scale of this latest spike and the pressures facing the boardroom. 

How to attract celebrity investors? 

Researchers and professors who study corporate governance and shareholder engagement have recognised the power of influential investors to reshape companies, says the HBR. Celebrity shareholders don’t just bring capital, they bring credibility, media attention, stakeholder sway and strategic guidance. Ultimately, their A-list backing can accelerate dealmaking and transform a company’s trajectory. However, the rewards are high because attracting heavyweights such as Bill Ackman, Warren Buffett or Cathie Wood is not easy, and it takes more than numbers. Businesses must craft a compelling equity story, reinforced by a clear business narrative and consistent financial delivery. In the battle for influence, a strong story is key to attracting high-profile investors. 

And finally… an AI avatar of a CEO 

This week marked the first time annual results were delivered by the AI avatar of a chief executive – in this case Simon Phillips of AIM-listed firm CT Automotive. The supplier of interior parts to high-end carmakers (like Lamborghini, Bentley & Lotus) showcased its digital edge and innovative spirit, crediting AI as a key profit driver last year. Interestingly, shares jumped nearly 20% in early trading, despite a 16% drop in revenue and a 63% rise in net debt to $6.2m. Could this be the first of many digital debuts reshaping how companies create shareholder impact? 

And finally… the Proxies 2024

As AGM season gets underway, FT Alphaville revisits the standout winners of its annual ‘Proxies’, a tongue-in-cheek awards celebration of executive perks and privileges.  Highlights from the year include $240k in private jet use, $2.2m in relocation costs, $10.4m in CEO security, ‘club memberships’ as a company expense and even individually assigned boats for C-suite attendees of a company event. For investors, the piece offers a sharp reminder of the disconnect that can exist between executive compensation & perks and meaningful shareholder value. For the rest of us, the Proxies is a rather amusing snapshot of the art (and graft) of executive excess.