Half-Yearly Financial Update

On behalf of the Board, I am pleased to present a financial update for The Brisbane Golf Club for the six-month period, 1 October 2024 to 31 March 2025.  We are continuing to make a solid recovery post the Golf Shop fire in October 2023, although higher than normal rainfall reduced playing days and this did have an impact on the financial result for the six months. Nevertheless, we were still able to generate EBITDA (Earnings before interest, tax and depreciation) of $525,518 for the period which was 5.1% higher than budget and 15.7% higher than the prior year, whilst at the same time increasing staff levels in course and golf operations areas, and in some cases lifting the quality of staff. We are on track to achieve our budgeted EBITDA for the year.

Profit and Loss

A strong membership renewal underpinned the six-monthly result with membership income 3.1% higher than budget and 8.0% higher than the prior period. We benefitted from being able to quickly fill member vacancies post the 1 October renewal and higher entrance fee income also contributed. As expected, golf retail revenue was down by 15.9% on the prior year as we didn’t have the replacement of golf clubs post the fire in the current six months, although their gross margin improved over the prior period. Golf operations revenue was strong because of increased demand for golf lessons, better quality corporate days and not having the fire impact. Food and beverage income was ahead of budget and prior year, although this didn’t translate to higher EBITDA. Recent staff changes should lead to an overall improvement in Members’ food and beverage experience and should underpin an improved financial result in this area. Total revenue was 0.9% higher than budget and 2.4% higher than the prior period. If the distortion because of the fire was removed, then the increase in revenue against the prior period would have been in the 6% to 7% range.

Total operating expenses were well contained overall. They were 0.4% higher than budget and 0.8% higher than the prior period, though were below the level of the revenue increase. As noted above we increased the number of staff on course and golf operations areas higher and were able to manage our overhead expenses well for the six months, including through a more targeted approach to the use of chemicals and fertilisers, and lower energy pricing.

Management and staff should be commended on the successful reopening of the Golf Shop in November, meeting the wet weather challenges post-Christmas, and providing an improved level of service to Members.

The below table summarises some of the key financial metrics for the period.

Some of the highlights for the six months are:

• New membership growth has continued the trend of the last few years, with a strong membership renewal and post renewal vacancies being filled very quickly.
• The golf operations/retail team have settled into their new facilities well, generating more demand for lessons and club fittings, and this is expected to continue to grow.
• Food and beverage bottom line was below expectations in the first quarter but was improving in the second quarter under the focus of Geoff Kuehner and Gillian Hirst.
• Overheads were well controlled across the board, but particularly in the course area.
• We were able to utilise savings to increase staff numbers in course and operational departments.
• Management continues to work hard to supplement Member contributions with non-member income with improved tennis car parking revenues and signing a contract for parking on the land adjacent to the 8th fairway.
• The continuing success of the Foundation, while not impacting this six month result should also be acknowledged.

Cashflow

During the six months the Club finalised the following significant capital expenditure projects:

• Rebuild of the Golf Shop, including state of the art golf retail experience.
• Establishment and fit-out of Putting and Swing Studio enabling enhanced club fit out and tuition experience.
• Refurbishment of men’s and women’s locker rooms.
• Resurfacing of 19th, 20th and 21st greens with TifEagle grass.
• Purchase of mower blade sharpening equipment to provide cost efficiencies and improved turf cut.
• Purchase of trencher/hopper providing to enable ongoing drainage improvements as evidenced on 3rd fairway.
• Upgrade of aging kitchen equipment to facilitate improved member dining experience.

The only significant capital expenditure in the second half of the year will be the resurfacing of the 11th, 12th and 13th greens.

Bank debt facilities with CBA were extended for a further 12 months. The Club also implemented its Winter Notes program during the period to assist with balancing cash flows between the first and second halves of the year, with these notes to be repaid by year end.

Summary

As noted at the outset I consider the financial result to be a solid recovery after the impact of the fire last year. Overall results are steadily improving year on year, and we continue to build resilience, but as previously highlighted our profitability is not yet at a sufficient level to enable us to meet both stay in business capital requirements and make ongoing improvements to the Club and its facilities as members increasingly expect. We need to continue to make further progress in this area, and the Board is currently working on strategies to help remedy this issue.

Thank you to all Members for your ongoing support of the Club through what has been a very interesting six months.

If anyone has any questions in relation to this report, please do not hesitate to contact me. My email address is a.mullis1@outlook.com or catch me when I am at the Club.

Kind regards

Andrew Mullis
Hon. Treasurer
The Brisbane Golf Club