As Malta's interim reporting season comes to a close, Edward Rizzo, Director of Rizzo Farrugia Stockbrokers, affirmed his position that when it comes to communicating with the investing public, local companies should update the market more frequently, as this would ultimately serve the investing public. Locally, the standard is for companies to adhere to mid-year and full year financial reports.  

He stated in a weekly local market update on that now that the interim financial reporting season is over, the majority of companies’ next performance report is in April 2024. Mr Rizzo believes that a timeframe of eight months without any news to shareholders is far too long.

Mr Rizzo also points towards more established, larger local companies such as Bank of Valletta plc, HSBC Bank Malta plc, Malta International Airport plc and APS Bank plc, commenting that the added information provided by these firms, including key financial information and market commentary, “is very helpful for the investing public”.

“All other companies should replicate such semi-annual announcements in May and November each year,” he writes.

Hence, he argues that the key to engaging and attracting more investors is a frequent communication strategy, as adopted by large local companies as well as international businesses.

“All other companies should therefore replicate such semi-annual announcements in May and November each year,” Mr Rizzo remarked.

Earlier this year Mr Rizzo had highlighted this same issue and shared the same sentiment. He argued that in Malta, financial statements and other important disclosures are, sometimes, also released while the market is open for trading. “This should not be allowed since market participants and investors need to have sufficient time to digest the contents of the announcement and react accordingly.”

He even stated that “very little effort is made by top management and directors of most companies” to explain the strategic direction of a company and how the various initiatives could lead to improved returns.

“Some companies in Malta even fail to organise a market briefing to provide added background on their financial results as well as their future strategy. Unfortunately, most Maltese companies simply fail to dedicate sufficient time and effort to communicating effectively with the market and this is clearly showing in the indifference by some market participants towards the entire equity market,” Mr Rizzo remarked.

He explained that CEOs of local companies, whose equity is listed on the Malta Stock Exchange, need to emulate the communications strategies used internationally to discuss the strategies adopted and available opportunities to grow shareholder value, “while always highlighting the threats or challenges that are always present.”

He concluded that added focus on improved shareholder communication can provide the necessary "impetus" for investor sentiment to improve after a particularly challenging period that hit Malta after political turmoil in 2019, COVID-19, FATF grey listing and the Russia-Ukraine War.

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Written By

Anthea Cachia

Anthea has a passion for writing, meeting new people and telling stories. With an insatiable curiosity Anthea loves roaming localities in search of long-established small businesses. When not scribbling away on a notebook or tapping on her computer, you can find her experimenting in the kitchen or traveling.