Anthony Hilton: A bleak future for financial PR

August has always been a dry month for financial reporting. Company results are geared to the corporate year end and these cluster around March, September and December. Only the relatively small number reporting to 30 June are available for coverage in the summer months.

Anthony Hilton
Anthony Hilton

There are of course half-time figures, market updates and in some cases quarterly reporting but it is thin gruel. There is usually only interest in the larger companies so there is little trickle-down to smaller consultancies.

Consultancies obviously see their activity levels drop and journalists have less to write about, although in recent times the problems of the latter have been mitigated by eruptions in the financial markets. These have always been prone to blow up in summer because trading is less, volatility greater and the more experienced heads of trading are lying on the beach.

A big takeover battle is the other source of relief, but there is little sign of anything new on this front. Indeed, one of the oddities of this recession is the low number of mergers and acquisitions. Normally by this stage in the cycle those with strong balance sheets are busy taking out competitors who have got overstretched.

This time that is not happening to any great extent. However well their own businesses may be doing, boards do not want to make big commitments. It is gloomy news for the consultancies that rely on this kind of work to provide the jam on their core businesses.

Some of this may be less apparent this year because most media outlets have shrunk business coverage to devote space to the Olympics, but this cyclical shortage should not be allowed to mask a structural shift with serious consequences for financial PR.

The brutal fact is that there is less and less interest in corporate reporting. Additionally, ten years of poor returns in stock markets have reduced private investors' interest and if the bears are correct in their forecasts of more lean years to come there will be no bounce-back. Altogether it is hard to see anything other than a bleak future for any PR business that sees communicating financial results as its core business.

Anthony Hilton is City commentator on London's Evening Standard.

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