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Board Report: March 2015

Hi Everyone,

The March Board meeting was the first proper Board meeting for 2015 with no meeting in January and our Planning Workshop in February and was held via conference call on Sunday 22nd March.

From a financial perspective the results for the 8 months to 28th February are a Net Operating Surplus of $1.27 million against a budget of $1.02 million, a positive difference of $250,000.  This is all due to timing differences and the underlying result is now slipping behind budget as some revenue items, particularly in the fundraising area have come in below budget in the last two months.  The Year-end Forecast for the 12 month Net Operating Surplus is now $573,000, some $163,000 less than the budget.  With only a few months to go to the end of the financial year there are few opportunities to regain this lost ground but work will continue to drive the result as far back towards the original budget as possible.  See the attached normal monthly report for details on the YTD results.

In terms of other outcomes from the meeting:

  • The main topic for the Board this month was following up the Board Strategy Workshop in February.  The original workshop was disrupted by fog at Christchurch airport that meant a number of Board members (including myself) were stranded elsewhere in the country and unable to make it, so we ended up holding two sessions to allow all the Board to be involved.  I would like to thank Graham Crombie for the leading role he took in running these sessions.

    We discussed a lot at these sessions but below are the highlights from my perspective:
  • We explored what we mean by the 'leadership' role that SLSNZ has for the movement - given we are essentially a 'co-operative' by the way we are structured.  That was useful to give ourselves greater clarity around areas where we see SLSNZ adding value by 'leading' and the areas where we are there to 'support' our clubs and members.
  • The question was raised as to whether there should be a role for the Board Appointments Panel beyond simply the brief activity of selecting and recommending Board appointments at the AGM.  In particular should there be a greater emphasis on succession planning and creating Board capability for the longer term?

    In that context, also raised was the question of whether a two year term was too short for Board members, as the instability created with the potential for the entire Board to change within a two year period is quite a significant risk.  Interesting the Sport NZ Governance Review recently completed also came to the same conclusion.
  • Speaking of which, the Sport NZ Governance Review, supported a lot of the practices which we have implemented in SLSNZ over the past few years, including the appointment of independent directors.  They suggested we continue to focus our limited time in Board meetings on matters of more strategic importance and less on operational reports from Management. 
  • We discussed the progress on the Strategic Plan for the Surf Life Saving Movement - and the importance that we don't rush this and take the time to get as much input as possible.
  • We felt it important that we articulate more clearly in the Strategic Plan document that we strive to 'create membership capability, not dependency'
  • We also discussed our ability to expand our reach in the area of public education, the investment we make in supporting Water Safety NZ ,which are two areas that are closely linked.  We have our Chairman, Deputy Chairman and CEO heavily involved with WSNZ and we reconfirmed that this something we feel is very important to continue doing.
  • The 2015/16 budget was also part of the discussions - and as always got plenty of debate.  The objective remains to continue to generate the same level of free cash as the last two years in order to replenish the operating capital and reserves that were wiped out in 2010.  The budget that has been set will do that, although due to a significant increase in the cost of Depreciation as a result of the PAM database upgrade and other capital projects over the last year or so coming on stream, the accounting 'Net Profit' will be down on what we have delivered in the last two years.  Fortunately depreciation is cash that stays in the business, so a reduced 'Net Profit' does not mean reduced cash generation.
  • This then led to a wider discussion on 'game changing' revenue streams and the fragility of the current revenue model to shocks such as reductions to gaming grants.  While some initiatives, such as seeking more Government funding and a new Foundation are in the plans, they are more likely to be medium to long term solutions and that we need to keep the pressure on to identify and develop more immediate options as well as keep working on the longer term initiatives.

The next steps are for the Board to do a final review of the budget and strategy document at its next meeting in April.

  • Getting back to the other items discussed at the meeting, the Board discussed progress on the selection of venues for National Events for 2015/16 and beyond, the appointment of the Management Teams for the NZ Open and Youth Teams for Rescue 2016 and the implementation of the recommendations from the Blue Sky Review.  While all are well underway, the need to finish things off was noted.
  • The dates for the next round of Club Chairs meetings was noted, taking place mainly over April and May with the timing of some slipping out to June.  This is a busy period but crucial in terms of being able to reflect on the season just gone and raising learnings to go forward into next season with.
  •  The Board looked at progress on the Key Performance Indicators - a clear sign of how busy the season has been.  It was delighted to note that the total membership had increased to 18,577, ahead of last year's total of 18,270.  Patrol hours at 185,759 were in line with the same time last year but rescues at 1,151 were 22% ahead of the 943 at the same time last year, the number of first aids were 29% up from 1,610 to 2,071.  In terms of awards we have 928 new lifeguards qualified versus 770 at the same time last year, and 3,111 refreshed versus 3,165 at the same time last year which looks healthy.  The number of new IRB drivers so far this year is the same as last year, but the refreshers are up 33% (648 versus 489 YTD and 567 for the whole of last year) so that is a good sign as this has been an area of concern in recent times.
  • And as usual the Board discussed Health & Safety, including a review of the YTD Serious Injury Summary for the 2014/15 Season - there have now been 14 injuries to members where a hospital visit was required and 41 others needing a visit to the doctor.   Sport remains the biggest single cause of those incidents, but there are still plenty of other areas contributing as you can see in the table below:

 

Occurrence during

YTD Doctor

2014/15

Doctor

Last Year

YTD Hospital

2014/15

Hospital

Last Year

Sport

14

24

5

6

Junior Surf/ Nippers

9

4

1

1

Recreation activity

6

 

1

 

IRB's (training & patrol)

5

13

3

5

ATV - on patrol

 

 

 

1

ATV's - not on patrol

 

1

 

1

Other Patrol

3

1

1

 

Lifeguard Training

1

1

1

 

Medical conditions

2

 

2

2

Travel to club

1

1

 

 

Not specified

 

2

 

1

TOTAL

41

47

14

17

So that's it from me - as a busy start to the year!   My thanks to everyone for their contributions on the beaches - it has been a very busy summer and not long to go until Easter when most will get a well-deserved rest!!  So until my next update……

Yours in surf,

Geoff Hamilton
Chairman
Surf Life Saving New Zealand