February 7, 2018
I have a thoroughly-deserved reputation for droning on interminably about the Club’s profits. To many members, this is an odd priority for a not-for-profit Club. But the point of making a profit is to generate the cash that is so badly needed to repair, upgrade and replace the aging infrastructure of our Club.
After the first quarter of our fiscal year, and before all Club members become immersed in the increased activity that comes to our Club with warmer weather and softer water, I would like to briefly review and explain the Club’s financial position. And yes, I will drone on some more about profits and the generation of cash to invest in our Club.
HOW DID WE DO IN 2017?
We were reminded in 2017 that the activities we love – on and beside the water – are weather-dependent. And 2017 was our perfect storm. High water made access to many of our docks difficult and submerged our principal outdoor dining area. And the poor weather of June and July resulted in reduced member activity. The financial consequences of both shoreline repair and reduced member dining and beverage activity combined to reduce our Club’s profit by about $50 thousand.
Despite those difficulties, the Club improved its profit by about $64 thousand over the previous year and almost broke even (a net loss of less than $15 thousand). Most importantly, the Club generated cash from operations, after debt payments, of over $56 thousand: Almost $20 thousand of that was used to improve the Club’s cash position, and the balance was allocated by your Board to urgent needs for repair and upgrade to the Club’s assets.
Food and Beverage overcame the poor weather and underwater outdoor dining area to generate a small profit.
And our membership grew significantly (27 net new members) for the second year in a row! Our improving facilities, our expanded offerings for those who do not have a boat, and the excellent dining have all combined to increase our number of members. And increased membership is vital, not only to our improved financial results but also as confirmation, among current and potential new members, that our Club is worth the money
OUR 2018 OPERATING BUDGET
With the expectation of normal water levels and summer weather, and reflecting the member fees approved by the members at the AGM, 2018 is expected to produce a net profit of about $50 thousand, with consequent cash from operations (after debt service) of over $100 thousand. I should point out that this 2018 budget, with nicely improved financial results, incorporates the significant expected additional costs of the new minimum wage requirements.
On recommendation from Finance Committee and approval of your Board, $30 thousand of that expected available cash flow will be used to further build the Club’s cash position and $70 thousand is to be spent on repairs, upgrades and replacements to the Club’s assets. Your Board has already approved requests for that money.
FINANCIAL RESULTS SO FAR IN 2018
The Club’ financial results through the first fiscal quarter ending on December 31 were almost dead on budget. Let’s all hope for normal water levels this year and good weather for dining outside.
To our General Manager and his staff whose efforts are producing these fine results.
To the Club’s Finance Committee who have put tremendous thought and effort into our operating budget and our capital budget.
And to your Board, who have spent the time and effort to scrutinize the Club’s budgets, to argue about the best use of your Club’s funds and to regularly scrutinize the monthly results.
I am proud of them all.
Director of Finance