President’s Update: January 2019

As we turn the final pages of 2018 and welcome a new year it is appropriate to reflect on accomplishments. While others might reflect on events and awards, my focus is the financial foundation of the club. We charted a course to improve the financial position of the club. So, how are we doing?

The cash to pay for operations comes primarily (85%) from member dues. We have done a good job in 2018 of keeping spending within the revenue generated. This may seem like a minor accomplishment, but we have a history of spending more than we generated and our cash reserves were at alarmingly low levels. Prior year variances have been driven more by surprises and optimism than an understanding that expenses need to match revenue. We will end 2018 with slightly more members than the prior year and an improving cash balance.

The shining star of operations spending has been Food & Beverage. Chef Darrin and Christie have produced high quality food with balanced and attentive service. The volatility and uncertainty of member dinning from day to day creates a difficult business model for private clubs. We have three months left in the fiscal year, so I won’t jinx the outcome by sharing our actual results. I will share that we are well ahead of the private club benchmark results and F&B made a positive contribution in 2018.

We still have the challenge of replacing and growing membership, keeping pace with regional wage inflation and deferred maintenance, but 2018 has been a good year for operations.

The sale of land adjacent #10 allowed us to retire nearly 80% of our bank debt. While we had hoped to close on the #6 land sale in 2018, that will get pushed to this year. Once complete we will retire the remaining bank debt and begin the process of monthly contributions to long term capital, short term emergency repair capital and operations accounts.

2018 was a good financial year for the club. We will continue on a course in 2019 to strengthen the financial foundation to weather the challenges ahead.

Happy New Year!
John Collins

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