Caldy Sports Club Annual Report

The Caldy Sports Club Limited

CHAIRMAN’S ANNUAL REPORT

This year has been very interesting.

The last 9 months (I was asked to chair CSCL in August 2017), we have tried to implement a number of initiatives.

There have been successes:

The investment & restructuring of the bar and catering facilities was completed in time for the season.  We now have greater capacity to meet bar demand and our catering is vastly improved getting commendation from home diners and visitors alike.  We are very grateful to Rod Walker, Dave Brewster, Gary Devaney & Jonathan Kemp for their substantial financial contribution.  The end of season activities was again successful and the innovation of touch rugby into the annual sevens enhanced the event.

The challenge of the very hard winter and now the summer drought has again shown the enormous contribution of Dickie Smith and the last of the summer wine team; many thanks.

However, our financial performance is not good.

Financial  2018

Forecast 2018

Actual 2017

Turnover

£233, 156

£300,000

£221,124

Total Cost of Sales

£114,554

£140,000

£115,899

Gross Margin

£118,602

£160,000

£105,225

Gross Margin %

50.9%

57.5%

47.59%

Direct Costs: Payroll

£89,256

£81,000

£82,612

% Payroll to sales

38.3%

27%

37.4%

Total Direct Costs

£113,991

£98,500

£97,849

Contribution

£4,611

£61,500

£7,376

% Contribution

2%

20.5%

3.3%

Overheads

£55,870

£60,000

£59,584

Membership Income

£26,688

£30,000

£29,996

EBITDA

(£24,571)

£31,500

(£22,242)

Three imperatives:

First to be financially sustainable.  This means managing our cost structure and generating additional revenues.  Losses this year are £24,571 due to the failure to manage the increasing costs and generate the additional income.  In May 2017 a plan was submitted by Catering Management & supported by the Rugby Section (see Attachment 1).  A key proposal was to support the bar/catering investment by restructuring the overhead by recruiting management support and a chef, effectively increasing overheads significantly.   In hindsight it was unjustified.  We are re-assessing the most effective structure and working to eliminate the cost burden.

Second  to protect our inheritance; CSCL has the responsibility to build on the intent of the first benefactors.  Our task is to maintain and enhance the Caldy infrastructure to enable this mission to be realised.  My predecessors (Bob Baty & Mark Dickinson) recognised this and introduced the subscription fee for each of the sections.  This has been distorted into a ‘levy’ argument which distracts from the true intent. 

Third to ring-fence the ‘professional’ rugby so that the costs associated with it are transparent and that it is sustainable by whatever funding means necessary.  This task is difficult to attain and has generated serious cashflow implications for both Rugby & CSCL.  We have very generous sponsors, who, for all their generosity, should not lead the sports club and equally the hundreds of parents paying subscriptions are not, without their agreement, sponsors.  The rugby club is pursuing the challenge of National One.  It is a brilliant achievement but to manage this budget and cashflows requires that we review our financial arrangements, accounting and banking.

We have proposed that we have a single bank account were all subscriptions are paid (with the exception of the professional arrangement).  That each member, no matter which section, pays a membership subscription fee and in addition any sum deemed necessary by their sections.  This membership subscription fee will pay for the upkeep and development of the club facilities (infrastructure) and grounds.  This is the case with many members club.  The sections will use their portion of the fees as the members see fit.  There is also the urgent need for an exceptional ‘one off’ charge to all members (to eliminate the losses & repay those individuals who have supported the cashflows) rather than endlessly going to a few generous but exasperated sponsors.

Challenges

We are making progress in all three objectives but still have some serious issues.  Our financial management and visibility must be improved.  To do this we need a clean sheet and I have requested an independent audit is performed prior to the AGM.  However, for the first time in many years, we do have a set of monthly accounts based on detailed Bar and Catering reports and the basis of a model to go forward.

I have also reviewed the physical expansion of our club; better facilities for members, accommodating our female teams & additional room for revenue generation (attachment 2).  We have discussed the possibilities with the local planning authorities.  To fund this a grant of £250k is possible from the RFU with the additional support of a number of serious benefactors.  However, with two years of poor financial results, this is not something we can attain in the short term.

We are also revitalising the CSCL organisation by implementing a more accountable structure (attachment 3).  We need new, younger and involved representatives.  We need individuals who have a long understanding of our club, have played the sports that we sponsor and are steeped in the ethos of Caldy Rugby, Cricket and Hockey.  I would recommend that the next president comes from the ranks of recent past players and who is in touch with that community.  CSCL needs the support of individuals who have a combination of ability and ethos thus bringing people like Mike Fletcher, Tim Kilpatrick, JJ Dickinson, Mark Dean and Simon Wright on board is vital. 

Summary

At the end of my spell as chairman, we have made some progress and learnt again that a plan on paper is not always deliverable on the ground. I wish my successor every success.  I stood in last year because I strongly believe in the ethos of CSCL and the vision of our original benefactors; my wish is that this ethos and vision is perpetuated.

Rgds

Denis

Denis Mahony

In the capacity of Chairman: Caldy Sports Club Limited

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