NIRI: Number of companies providing guidance declines slightly

VIENNA, VA: Results from this year's National Investor Relations Institute (NIRI) Guidance Practice and Preference survey showed only a small decline in financial and non-financial guidance from public companies during the economic recession.

VIENNA, VA: Results from this year's National Investor Relations Institute (NIRI) Guidance Practice and Preference survey showed only a small decline in financial and non-financial guidance from public companies during the economic recession.

Results, which were released May 18, found that 60% of respondents still provide earnings guidance, a drop from 64% in 2008. Eighty-two percent provide other financial guidance versus 86% in 2008. Of those who give financial guidance, capital expenditures, revenue or sales, and tax rate were the most favored financial measurements.

The survey also found that 55% of respondents provide guidance on non-financial measurements. In 2008, 57% of respondents said they did. The most popular non-financial measurements were qualitative statements about market conditions, industry-specific information, and trend information.

Twenty-five percent of all respondents provide guidance in all three measures.

“There had been some high profile examples of people giving up guidance, like GE,” said Jeff Morgan, president and CEO of NIRI. “From an IR standpoint, now's the time when you need to [share] good financial information with investors. NIRI's recommendation is you should give a breadth of guidance and a breadth of types of guidance, and I think that's what [we're] seeing.”

The main reason cited for discontinuing earnings or other guidance was “change in visibility/forecasting ability of the business.”

The survey, in its fifth year, was open to all NIRI corporate members and conducted online from April 2 through April 21; 515 members participated, equaling an 18% response rate.

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