Outcome preliminary research FD Henri Sijthoff Award 2007

The overall financial communication of AEX firms has improved considerably over the last year and exceeds the Midkap and Small cap. This can be concluded from the research Jungle Rating conducted for ‘Het Financieele Dagblad’. We assessed the corporate websites of all 152 Dutch listed companies. Listed companies communicate poorly on their key financials and lack an annual report in HTML. The Midkap has made a tremendous improvement on offering share information.

For the FD Henri Sijthoff Award 2007, Jungle Rating examines the quality of the corporate websites of all companies listed in the Netherlands for the fifth time in a row. The 50 websites with the highest score qualified for the main research, which will be conducted in May and June. This year, Jungle Rating also examines the websites of 20 non-listed Dutch companies.

Findings of the preliminary research

Jungle Rating has assessed all websites of Dutch listed companies based on ten main criteria between March 3rd and April 10th 2007. This way we have selected 50 companies that participate in the main research. The list of 50 websites can be found below this article. It is also possible to download the preliminary research report (PDF, 544 kB).This article describes the findings of the preliminary research and gives insight in the exact criteria.

AEX outperforms Midkap and Small cap this year

Let’s take a look at the average scores of the indices in 2006 and 2007. The gap between the quality of the websites of AEX on the one hand and Midkap and Small cap on the other hand has increased. Each year, Jungle Rating adjusts the criteria to keep up with recent developments and new techniques, but in spite of that fact the AEX websites have obtained a higher score. Not only compared to last year’s scores, but compared to the Midkap and Small cap firms as well.

Average score per index for 2007 and 2006

Figure: Average score per index for 2007 and 2006 Source: Het Financieele Dagblad & Jungle Rating

Highlighting interesting results

The websites were assessed based on 10 criteria. We will discuss three of them here. For all results we refer to the preliminary research report (PDF, 544 kB).

1. Absence of key financials is remarkable
Remarkably few corporate websites present their key financials in HTML. Jungle Rating examined the presence of the following financials:

Balance sheet
Income statement
Share related figures
Ratios (for example solvency, interest coverage and debt/equity)

Why do they have to be in HTML? Offering these figures in HTML is more user friendly than offering a link to a PDF download. Only 56% of AEX companies received the maximum score on offering key financials, 38% of the Midkap and 25% of the Small cap. This is remarkable as those key financials are easy to implement in the website. They are already available and are an important source of information for investors.

2. Possibilities internet not entirely used in annual report
The annual report in HTML is not yet widespread. An annual report in HTML is much more user friendly and offers more opportunities for interaction than an image based or PDF report. At the time of the preliminary research, merely 13 companies made full use of the possibilities of the internet and had an annual report in HTML on their website.

3. Midkap catches up on share information
The Midkap companies catch up on offering share information. Real-time share price information is required, as well as the presence of dividend information and share price graphs.

Score on the item share information for 2007 and 2006

Figure: Score on the item share information for 2007 and 2006
Source: Het Financieele Dagblad & Jungle Rating

The average score of the Midkap on this criterion is even higher than the score of the AEX last year. The AEX companies have made a considerable improvement of their score on this criterion as well. The Small cap companies stay behind as they often refer to external websites, Euronext for example, for real-time share price information and graphs.

The main research

In May and June Jungle Rating will conduct the main research among the 50 listed companies and 20 non-listed companies. In October, we will present the outcome and conclusions of the research. Then we will also be able to provide you with the most important trends in online financial communications for 2007.

* The company is a newcomer compared to 2006