Hi Everyone,
As the season comes to a close a big thanks to everyone for all
their work out there this year - it has been a busy one and the
warm summer weather continues to keep our beaches well used!
The February Board meeting was our annual Planning Workshop held
in Wellington on Friday 19th and Saturday
20th February. This was an interesting weekend as it
co-incided with the Edinburgh Military Tattoo being in town so
there was no accommodation available in the lower North Island and
our out-of-town Board members had to be billeted out for their
Friday night stay!!
From a financial perspective the results for the eight months to
29th February are a Net Operating Surplus of $1.223
million, which is $887,500 ahead of budget. This positive
variance is all due to timing variations and is not indicative of
the full year situation. The full explanation of the
variances is in the Dashboard report.
In the latest forecast the full year Net Operating Surplus has
slipped back to $16k (i.e. at a breakeven level). We are now
$334k less than budget, driven by the NZLGB grant being $200,000
less than budgeted, a short term sponsorship contract of $100,000
now being renewed and two gaming trust grants being $160,000 less
than budgeted, with a few wins along the way offsetting
this. With depreciation being close to $0.5m this year a
breakeven Net Operating Surplus result still leaves (after paying
for capital expenditure) with a good level of positive cashflow for
the year and in line with last year, however we will need to
closely monitor the run-out to the end of the year as there is a
lot less 'fat' left to deal with any unexpected events.
The targets set for this year were deliberately very aggressive,
knowing that we would be starting to see the loss of State
Insurance sponsorship income, so the Board is comfortable with the
likely outcome for the year.
February was the first time the Board had met since December,
and our agenda was dedicated solely to planning - thinking about
our strategic direction and reviewing the 2016/17 Strategic Plan
and budget prepared by the Management team. In a break from
tradition we took two days for this meeting, which also allowed us
to include some extra time with staff and some of our
volunteers.
In terms of the items of note from the meeting:
- In terms of the Strategic Plan, there are no radical departures
from the path that has been successfully on over the last few
years. There will be a minor update to the presentation
format of our priorities to align more with how we presented them
in the 2015 Annual Report, but the core activities themselves
remain the same, and it is a 'steady as she goes' approach focussed
on continuing to deliver to the membership and rebuild the reserves
to pre-2010 levels. The plan document will be available
soon on the SLSNZ website and circulated to clubs for any comment
or feedback.
- The top priority activity for 2016/17 is to lock in a
replacement revenue for the State Insurance sponsorship.
While there are conversations underway, there is no certainty of
being able to confirm a deal before the State Insurance contract
ends in June. As such we have approved two budgets for
2016/17:
- Plan A - where $500,000 of replacement income is obtained;
and
- Plan B - where it isn't. This version of the budget
requires $500,000 of 'belt tightening' initiatives to be
implemented.
Plan A has a similar Net Operating Surplus to the forecast result
for 2015/16, i.e. breakeven - with positive cashflow coming due to
continuing high depreciation costs. Plan B obviously has the
same bottom line too, but with a bit of 'pain' along the way in
order to achieve that. The cost-saving initiatives are
intended to be short term and focus on areas which have as little
external impact as possible, with the intention of re-investing
again when the extra income is obtained.
- As part of the strategy discussions, the Board recommitted to
the level of input going into Water Safety NZ - as this is a core
plank in the strategy to bring more government funding into the
movement.
- With planning now starting for the 2016 AGM, the process
of Board appointments will soon begin again, so the Board
spent quite a bit of time looking ahead a few years and thinking
about succession planning for itself. To give people enough
time to build experience for the main leadership roles it's
important to be thinking well ahead, and the Governance
Sub-committee of the Board will continue to do more work on this to
be in a position to give the Board Appointments Panel a good
'steer' when they are brought together in June.
- Over the course of the two days a wide variety of other topics
were covered - including the workplans of the National Sport and
Lifesaving committees, the soon to be established SLSNZ Foundation,
club health in general, organisation structures, the potential for
major 'disruption' to the movement, risk management, health and
safety, priorities for the board itself, where the operating
environment is heading, the value SLS is providing its
stakeholders, the high performance sport programme, and our role in
the International Lifesaving Federation. All were very
valuable discussions and fed into the decisions around the
strategy.
The next Board meeting will be held in Wellington on Monday
18th April. So that's it from me - although I will
add one reminder - that nominations for Regional Service Awards
close on 31st
March, and for National Service Awards on 30th June -
please take advantage of these opportunities to reward the
longstanding contributors to your clubs and the movement.
So until my next update……
Yours in surf,
Geoff Hamilton
Chairman
Surf Life Saving New
Zealand
