2021-09-07 Services & Organisation Committee Meeting Agenda

SERVICES & ORGANISATION COMMITTEE MEETING AGENDA                                     7 SEPTEMBER 2021


compared to the three-year average across 2016/17 to 2018/19, venue hire was down 18%, food
(café) sales down 22%, retail down 10% and crèche down 52%. This underperformance points to
a structural shift in consumers’ usage patterns since Covid-19 emerged and it is expected that we
will continue to see underperformance in these areas moving forward.
Pleasingly, NLC saw very strong revenue performance from the group fitness program which
produced revenue of $221k, roughly $70k or 47% higher than the three-year average. Sports
program revenue also performed well, up 17% on the three-year average. The group fitness
program has continued its impressive growth trajectory over recent years and NLC’s evolving
offering is clearly being well received by locals who are keen to exercise and connect with each
other. It’s a similar story for sports program revenue, with strong performance in this category
thanks to growing participation in stadium sports such as pickleball and badminton, as well as
others. Both group fitness and sports programs benefit from membership revenue and have been
beneficiaries of more patrons choosing to utilise NLC’s services via a membership instead of as a
casual user or visit pass holder.
Expenditure finished the year approximately $44k 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 10% on the three-year average, however, this is unsurprising given the compounding effect of
pay rises, growth in group fitness labour and expanded weekend operating hours over this time.
The snapshot of historical performance below shows that the net operating result for NLC has
remained relatively consistent over recent years. This is particularly pleasing given the impacts of
Covid-19 over the past two years and the negative structural changes we’re seeing to revenue
streams such as venue hire and café sales.
NLC historical financial performance – 2016/17 to 2020/21
                                             2016/17     2017/18     2018/19     2019/20     2020/21
Revenue                                      actuals     actuals     actuals     actuals     actuals
40023 - Miscellaneous Fees & Charges               0           0           0           0           0
41103 - Other - Sales - Bar & Kiosk Sales          0           0           0           0           0
41154 - Venue Hire                           159,382     174,028     174,233     125,455     139,362
42019 - Other - Sales - Food                 177,777     180,011     177,696     131,115     138,806
42020 - Other - Sales - Retail                   563       7,165       4,181       3,948       3,564
42074 - Group Fitness Revenue                118,451     146,775     185,424     161,104     221,021
42076 - Creche Revenue                         9,712       8,704       8,253       4,964       4,258
42077 - Kids Playroom Revenue                 17,198      21,507      22,895      13,623      20,957
42078 - Sports Program Revenue                20,234      25,587      25,927      23,250      28,029
49030 - Internal Recoveries - Catering             0           0           0           0           0
                                             503,318     563,776     598,607     463,459     555,997


Controllable expenses
6EX01 - Employee Benefits                    413,875     427,629     446,174     413,505     472,183
6EX02 - Finance Costs                          1,174       (851)       (220)       (187)     (11,930)
6EX03 - Materials & Services                 329,676     341,621     369,887     293,039     340,259
6EX06 - Other Expenses                         2,921       3,023       3,129       2,985        3,257
                                             747,646     771,423     818,970     709,343     803,770

Net operating result                        (244,327)   (207,646)   (220,362)   (245,884)   (247,772)


Uncontrollable expenses
6EX04 - Depreciation & Amortization           74,755      84,767      84,767      88,938      89,044
6EX12 - Internal Charges                     147,793     304,066     213,217     224,039     234,396
                                             222,548     388,833     297,984     312,977     323,440

Total operating result                      (466,875)   (596,479)   (518,347)   (558,861)   (571,213)

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