The Executive and I wish you all a very Merry Christmas and a Prosperous New Year.
This time last year your executive and management were pondering over the task ahead on how we were going to change the current direction the club was heading and put in place systems, procedures and reporting to enable us to obtain up to date information on the clubs performance. At first glance the challenge of solving or mitigating the clubs issues was quite daunting and I was very concerned whether your executive had the required skill set to accomplish these challenges.
To remind you of some of the issues:
The club was involved in legal proceedings with Stokes Valley Cosmopolitan Club which would have forced a fire sale of their premises which on receipt of legal advice would have been to no advantage to PWMC.
The Club was continuing to spend a considerable amount of money (around $65K) per year to maintain the resource consent on the hotel conference centre project whilst the actual build costs were spiralling upwards.
We were also struggling to pay our creditors. In November 2014 we owed them $480K and the bank was looking closely at our ongoing financial commitments. It was even suggested that we may have to sell some of our assets to ensure the continued viability of the club.
Our investment properties with a mortgage of around $6.7 million presented additional issues.
We had no real way of forecasting our cash flow, all our reports were a month behind what was actually happening.
Quite obviously we had to address these issues and stabilise the club.
So what did we do?
We commissioned a full financial review from an independent agent.
We commissioned a business planning and strategy review.
We commissioned a review of our organisational structure.
These reviews gave us the information and tools to arrest the continual drain on our finances, put in place meaningful budgets, instigate cash flow forecasting and improve the staff management and executive reports to the Executive and Trustees.
From the Business Planning and Strategy review 74 short to medium term action points were recognised. Of these, 42 have been completed with a further 24 being an ongoing work in progress. The remaining 8 action points are either fiscally challenging at this point in time or deemed long term projects.
I am pleased to say that as we now approach the festive season the club is in better health than this time last year.
All our creditors are now current which has meant we have paid off $280K of debt.
We have also managed down the clubs annual leave risk with a $60K reduction in exposure.
We are achieving a modest return on the vacant site by leasing part to a car sales operation.
The lease on the car park on the corner of Udy and Britannia St has been cancelled saving $35K.
We have renegotiated the clubs insurance policy with a saving of around $100K per year.
Budgets are reviewed and adjusted quarterly, and finally the rules review has been completed and will be presented to members for adoption at a SGM in February 2016.
All in all I hope you will agree a considerable turn round of a not to flashy situation.
My thanks go to the Executive, Trustees, Management and Staff who have made themselves available to attend twice weekly meetings in order to ensure that current information was available to enable informed decisions on the clubs operation.
My focus in the New Year is to continue working on reducing our debt and hopefully start saving a few dollars. The board of the Property Investment Company is also looking at ways to reduce the principle owing on the investment properties. However realistically it will most probably be 15 years before they are freehold.
As members of the club the best thing you can do to help us accomplish our goals is to patronise your club. We will only succeed if you are prepared to come and socialise with family, friends or in the company of other members. Support the bar and restaurants, support adjunct activities, buy raffles and support the many shows and bands that come through our doors.
I know that everyone is now focussed on Christmas and the New Year. Please enjoy this festive season. If travelling please remember that the driving speed tolerance is 4 km/ph above the limit during this period. Please also remember the club subsidised taxi service is available.
Check our club notice boards and website http://www.petoneclub.co.nz for all upcoming events over the festive season.
May you all have a very Merry Christmas and a Prosperous New Year.