2021-09-07 Services & Organisation Committee Meeting Agenda

SERVICES & ORGANISATION COMMITTEE MEETING AGENDA                              7 SEPTEMBER 2021


End of year performance against budget shows revenue up 17%, while expenditure was over
budget by 5%. Overall, the centre finished $124k ahead of the net budgeted position, a strong
result given the impact and uncertainties of Covid-19.
The NAC was quite fortunate to not suffer significantly from Covid-related patron density limits
throughout the year thanks largely to the outdoor nature of the facility. That said, there were brief
periods of low visitation numbers due to shutdowns or restrictions on people being able to visit if
they’d recently been in hot spots.
All revenue streams performed strongly against budget, particularly learn to swim revenue,
however, a comparison to previous years’ performance paints a more meaningful picture. In this
regard, revenue performance was broadly in line with a three-year average across 2016/17 to
2018/19. Total revenue was just 1% below the average and while there were other small variances,
most weren’t of material concern.
Lease revenue (café) was down 57% against the average as rent-free periods were granted to
help the lessee continue to operate during our quietest periods early in the year. Admission fees
were also down but most of this related to a shift in business models where the NAC now collects
junior squad revenue directly (via the squad revenue budget line) but does not separately levy a
casual entry charge for participants, as used to be the case. Admission fees revenue has also
been impacted as more people access the centre via memberships, with this revenue instead
showing up in group fitness, squad and gym revenue.
Expenditure finished the year approximately $143k over budget which was more indicative of
inaccurate budgets rather than true overspends. When comparing results to the previously
referenced three-year average there were few material variances to report. Employee costs were
up 12% on the three-year average however this is unsurprising given the compounding effect of
pay rises over time and the additional labour required this year to administer and enforce Covid-
19 restrictions and cleaning requirements.
The snapshot of historical performance below shows that the net operating result for the NAC has
worsened a little over recent years. This is no big surprise given the disruption of Covid-19 and
increased competition in this time (St Andrew’s pool), however the team will continue to work hard
to minimise the operational cost of the facility over coming years. While revenue growth appears
to have plateaued, operational expenses (largely labour) have continued to increase and this is
the main cause of financial performance deteriorating somewhat.




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