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NYSE Euronext (NYX) is pleased to announce the priorities identified by members of its Strategic Planning Committee for SMEs at their first meeting, held 23 March 2012 in Paris, as well as the agenda the Committee has set itself. At this first session, it also reviewed the results of a survey of small and mid-caps conducted by TNS Sofres.
Priorities and agenda defined by the Strategic Planning Committee
The Committee selected the following themes as priorities for its second meeting: “Issuer services and our business model”, “Services for intermediaries and investors, and our business model” and “Promoting stock-market listings and financing: marketing the market”. This second meeting will take place on 18 April 2012 in Lyon, and working groups have been set up for the session.
“Which market for SMEs” will be the main subject of the Committee’s third meeting, to take place on 22 May 2012 in Brussels. Members will examine the economic, legal and financial structures as well as resources.
A summary of the work of the Strategic Planning Committee will be drawn up at the 12 June 2012 meeting in Marseilles. After a progress report at the summer session for company heads on 30 June 2012 in Porto, a full report of the Committee’s work will be published and presented at the Paris Europlace Journées in July 2012, and then to main market organizations and stakeholders between now and the end of September 2012.
Results of the survey and recommendations for implementing strategic guidelines will be presented to the NYSE Euronext Board of Directors in Paris and distributed to the market in September 2012 after these have been finalized and adopted in Amsterdam.
Following this first meeting of the Strategic Planning Committee, several proposals were made to give the market for listed SMEs a fresh boost, including European deployment of the new bond option for issuing, placing and trading corporate bonds. This has been validated by members of the Committee and has their strong support.
TNS Sofres Survey of SMEs
In November 2011, NYSE Euronext commissioned a survey on SME expectations for financing from TNS Sofres. The aim was to collect client feedback on services at the time of listing and on current services available to companies listed on NYSE Euronext’s French market, and to identify areas for improvement and development. The sample group included 123 SMEs, of which 23% were listed in compartment B, 50% in compartment C, and 27% on NYSE Alternext.
Main conclusions of the survey presented to members of the Strategic Planning Committee as summarised below:
Listing: user satisfaction was tested over time and by a particularly difficult market environment
- When companies list on the stock market, they aim to raise capital but also to increase their visibility: 34% of entrepreneurs surveyed said their main motivation was financing growth, while 19% wanted to strengthen their equity and 13% sought greater credibility and notoriety. Guaranteed liquidity for some shareholders was a decisive factor for only 9% of respondents.
- The listing process itself and assistance provided by NYSE Euronext were described as satisfactory or very satisfactory by 62% of respondents, all segments combined. This rose to 80% for entrepreneurs that had personally taken part in their listing.
- Post-listing satisfaction concerned primarily the security of transactions guaranteed by NYSE Euronext (89% satisfied), quality of trading services (78% satisfied) and fast response if needed (73% satisfied). Those surveyed had more reservations on the liquidity of their shares and market depth (36% satisfied).
- A majority of issuers were satisfied with their stock-market listing (67%). The result for companies listed on NYSE Euronext’s C compartment was significantly lower, with only 59% reporting that the transaction met or exceeded their expectations.
- Listing brought commercial benefits for 57% of companies surveyed. This rose to 73% for surveyed companies listed on NYSE Alternext.
- In the current market environment, there are contrasting opinions on the usefulness of listing as a strategic tool for growth. 48% of issuers responded that listing still met their financing needs, but this was higher for companies listed on NYSE Alternext. Responses were more mixed for listings in compartment C.
- Targeted initiatives are needed, focusing on proximity to the market, to increase the base of issuers convinced that listing is positive. The Survey shows that 70% of respondents are in wait-and-see mode – dedicated to their listing and determined to remain listed, but that 30% have disconnected from further initiatives on this front.
Listing and SME financing – a paradox that demands attention
- 78% of SME respondents indicated that they were aware of the likelihood that bank credit was set to grow tighter. Yet even so 60% indicated that they were envisaging a traditional bank loan to finance growth in the next two years, up from 58% in the past. At this point, only 33% were considering a capital increase through a public offering.
NYSE Euronext day to day – service quality is good
- On the whole, a majority of issuers surveyed were satisfied with the services offered by NYSE Euronext (88% satisfied, rising to 97% for companies listed in compartment B).
- Of dedicated services for issuers, ExpertLine, the interactive communications platform coordinated by market professionals and Mylisting intranet are widely used: 71% of respondents are on Mylisting, and 63% use ExpertLine. In contrast, 67% have never used the NYSE Euronext lobbying service and 69% have not taken advantage of its marketing and “visibility” initiatives.
- Day-to-day contacts are very good for 62% of issuers surveyed, although 28% of the sample did indicate that they wanted NYSE Euronext to develop new services. Those most often cited were financial communications and regulatory issues.
“We find the results of the TNS Sofres Survey extremely useful, and in recent months invaluable in fine-tuning our service offering for issuers, particularly the SMEs that make up 80% of the companies listed with us. We are aware that the economic environment in which respondents found themselves had an unsettling and lasting impact on entrepreneurs’ confidence and outlook. And we are dedicated to adapting the solutions and services we offer to ensure that our clients have a cutting-edge platform, along with the most liquid and most efficient market model in the world,” said Dominique Cerutti, President and Deputy CEO at NYSE Euronext.
“I want to thank the Strategic Planning Committee for its dedication and active participation in this first meeting. Members have undertaken a complete analysis of how these companies obtain financing on the market; they have read recent reports on the market as well as our commitments to facilitating SME access to listing,” he added. “As a result, the conclusions of the ambitious programme that we have agreed to pursue together will take the form of a survey and will be presented in July 2012.”
