2019-08-06 Services & Organisation Committee Agenda

SERVICES & ORGANISATION COMMITTEE MEETING AGENDA                                            6 AUGUST 2019


Items of note with regard to major expenditure budget variances include:

1.      Employee benefits finished the year $13,217 over budget. This was largely due to an
        increase in casual labour and penalty rates to accommodate the growing pickleball
        program, three large special event bookings (offset by revenue growth) and the relocation
        of a mini library within the centre while the Noosaville Library refurbishment works were
        being completed.
2.      Contract Services - Fitness Instruction was over budget by $24,435 in order to facilitate
        group fitness program growth. This was fully offset by revenue growth.
3.      Electricity for the year was budgeted at $41,495, however, it was great to see the rooftop
        solar panels (operational from July 2018) reduce this expense by 28.9%, with expenditure
        settling $11,996 under budget.

The comparison of the past five years’ financial performance below reveals strong revenue
growth at NLC, particularly over the past three years. This growth relates almost entirely to the
group fitness program and venue hire. The increase in materials and services expenditure in
2018/19 is a result of increased expenditure on group fitness instructors required to deliver the
growing program.

A change in cost allocation methodology for internal charges resulted in reduced uncontrollable
expenses for NLC in 2018/19 and in turn led to an improved total operating result compared to
2017/18.

NLC historical financial performance – 2014/15 to 2018/19

                                       Historical financial performance - NLC

                                                    2014/15      2015/16      2016/17      2017/18      2018/19
Revenue                                             actuals      actuals      actuals      actuals      actuals
40023 - Miscellaneous Fees & Charges              (100,563)             0            0            0            0
41103 - Other - Sales - Bar & Kiosk Sales                  0      (4,483)            0            0            0
41154 - Venue Hire                                (185,900)    (151,496)    (159,382)    (174,028)    (174,233)
42019 - Other - Sales - Food                      (164,151)    (175,533)    (177,777)    (180,011)    (177,696)
42020 - Other - Sales - Retail                         (471)        (168)        (563)      (7,165)      (4,181)
42074 - Group Fitness Revenue                              0    (86,686)    (118,451)    (146,775)    (185,424)
42076 - Creche Revenue                                     0      (5,445)      (9,712)      (8,704)      (8,253)
42077 - Kids Playroom Revenue                              0    (19,587)     (17,198)     (21,507)     (22,895)
42078 - Sports Program Revenue                             0    (20,498)     (20,234)     (25,587)     (25,927)
49030 - Internal Recoveries - Catering               (2,600)        (144)            0            0            0
                                                  (453,684)    (464,041)    (503,318)    (563,776)    (598,607)


Controllable expenses
6EX01 - Employee Benefits                          412,729      417,755      413,875      427,629      446,174
6EX02 - Finance Costs                                    0            3        1,174        (851)        (220)
6EX03 - Materials & Services                       279,536      296,534      329,676      341,621      369,887
6EX06 - Other Expenses                               2,727        2,823        2,921        3,023        3,129
                                                   694,992      717,115      747,646      771,423      818,970

Net operating result                              -241,308     -253,074     -244,327     -207,646     -220,362


Uncontrollable expenses
6EX04 - Depreciation & Amortization                138,608       71,839       74,755       84,767       84,767
6EX12 - Internal Charges                           145,954      151,640      147,793      304,066      213,217
                                                   284,562      223,479      222,548      388,833      297,984

Total operating result                            -525,871     -476,553     -466,875     -596,479     -518,347




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