2015-09-15 Infrastructure and Services Committee Att 2 to Item 4 The J Service Review 2014-15

                                                                                                    Service Review 2014-15
                                                                                                                                       The J

10.2.2 Breakdown of revenue

                                    Breakdown of Venue Hire Revenue by Charge Type
 $90,000
 $80,000
 $70,000
 $60,000
 $50,000
 $40,000
 $30,000
 $20,000
 $10,000
      $0
                                      WMCC




                                                             WMCC




                                                                                                              WMCC




                                                                                                                                      WMCC
                                                                             Other
             Other

                     Performances




                                             Other




                                                                                     Performances




                                                                                                                      Other
                                                                    Church
                                                     Youth




                                                                                                      Youth




                                                                                                                              Youth
                Commercial                   Community (NFP)                     Negotiated                          Other Community/
                                                                                                                          Regular


The majority of the negotiated hire revenue for the period 1 January – 30 September 2014 relates to
the Hillsong Church ($87,782) and Performances ($36,592). Generally the negotiated rates involve
hire of multiple rooms within the venue and/or other elements such as ticketing, bar takings, etc. In
the case of the Performance category, a full profit and loss analysis is required, rather than to focus
on the venue hire alone (as shown in the graph above). Previously the absence of accurate software
systems for calculating the Cost of Goods Sold made it too labour-intensive to calculate accurate
profit/loss. Additionally, the allocation of wages and full ticketing data was also not available. Since
the introduction of software systems after de-amalgamation, continual refining of the stock
management module has occurred. It is now at a point where accurate information can contribute to
profit and loss calculations. The J staff are also working with the Finance team to implement full profit
& loss analyses on performance-related events/venue hire.

The breakdown between the other categories (i.e. the bookings are charged at the gazetted fees)
represent approximately one third of the venue hire revenue for the period. No immediate change is
recommended here, however a ‘regular commercial’ rate could be considered in the future.
Community (NFP) charge-out rates are also highly subsidised and further review or increase in these
charges could be considered.

The Breakdown of Venue Hire Revenue by Charge Type graph above does not include lease revenue
from USC or Noosa Community Radio ($76,372 p.a.).

The loss of major clients including Hillsong Church and anchor tenant USC has the potential to impact
on The J revenue by approximately $174,000 or 39% of current revenue streams. Contingency plans
need to be developed if either organisation was to leave the venue.

USC‘s lease with The J expires 31 December 2016 but they have a 10 year renewal option.

A Memorandum of Understanding is reviewed annually with Hillsong Church. Discussions with the
church have indicated that they would like to continue their use of The J for a minimum of 3-5 years.

  OPPORTUNITY – Implement profit & loss analysis for relevant performances and events.




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