While every quarter is different, the “playbook” for preparing senior management for a successful earnings conference call is largely the same. Specifically, the best prepared CEOs and CFOs follow a set of key strategic and tactical steps designed to bring them through a review of all of the essential elements pertinent to the investment community’s analysis of quarterly earnings. In short, CEOs and CFOs that have allocated adequate time to understanding the results, in the context of both internal and external expectations, and are capable of addressing all possible topics with ease and transparency will succeed. Drafting the conference call script is just one piece of this important process. Below, we walk you through these best practices of an effective earnings call.
1. Establish a timeline of deliverables at the outset so all participants know what is expected of them and when.
- Map out the mission-critical items, such as preparing the earnings press release and all the necessary financial tables and disclosures; the requisite SEC filings; the drafting of the conference call scripts and any supporting documents (e.g., slides); the creation of a Q&A document; and the dry-run.
- Include administrative tasks such as arranging for the call itself, creating the queue order in which analysts will ask questions on the call, obtaining the proper pre-clearance of the press release with the Nasdaq or NYSE and so forth.
- Be mindful of potential bottlenecks such as audit committee approval and legal review.