Moss Vale Swimming Pool Re-Development. Business Plan & Projected Financial Performance

Transcription

1 Moss Vale Swimming Pool Re-Development Business Plan & Projected Financial Performance Prepared For By Unified Community Sports & Leisure

2 Table of Contents Executive Summary...3 Background and Scope...4 Methodology...4 Proposed Concept Plan...5 Gymnasium Fitness Component...6 Energy & Water Efficiency...7 Location of Council Swimming Pool Development...7 Management Options...9 Indicative Programs...11 Indicative Operating Hours Indicative Customer Fees Five Year Business Plan Attachments Supporting Information About Unified Community Sports and Leisure Principals Unified Community Sports and Leisure...24 Commercial In Confidence 2

3 Executive Summary (WSC) has resolved to re-develop the Moss Vale Swimming Pool, to include indoor heated pools and amenities. Unified Community Sports & Leisure (UCSL), a leisure management and consultancy company has reviewed the proposed concept and has prepared projected financial and service levels over five years. Based on UCSL s assessment and experience the redeveloped facility is projected to attract circa 80,000 visits and will require an operating subsidy in the vicinity of $ ,000 per annum - a subsidy of $6.00 per customer visit. Based on Capital Borrowings of $8mill Council repayment commitment will be $920,000 per annum over 15 years. The redevelopment concept as reviewed, is an unsophisticated design and does not provide for key fitness and therapy markets which if included would significantly improve financial and service outcomes. The addition of a 300 m2 Gymnasium Fitness component at a capital cost of $600,000, after a month ramp up, would provide additional attendances circa 70,000 per annum, additional income circa $600,000 per annum and a net contribution to facility overheads of circa $400,000. The addition of a Gymnasium Fitness component would reduce the subsidy required to circa $50,000 a subsidy circa $.20c.per visit. The decision to locate the redevelopment at Moss Vale location in preference to other locations within the council has been made primarily due to the lower capital investment required to redevelop the existing Moss Vale Swimming pool site. The location of the development at the Bowral Swimming Pool sites has also been examined by Council. Council should closely consider the provision of the services that will be provided by the redevelopment within the context of the overall capital cost to develop each site, the relative merits of both sites and Council s ongoing financial contribution required to provide services outcomes. A number of environmental opportunities, water harvesting, water treatment, pool depth and siting of the pool have been identified and could be incorporated into the project design stage to improve operational efficiency depending on budget parameters. Typically leisure facilities are either managed by the owner (i.e. Council employed staff) or outsourced to specialist management companies and the advantages and disadvantages are identified. Commercial In Confidence 3

4 Background and Scope (WSC) has resolved to re-develop the Moss Vale Swimming Pool, an outdoor aquatic complex, to include An indoor 25 metre 8 Lane training pool An indoor warm water leisure / multipurpose pool Multipurpose rooms and Associated plant, administration and amenity areas. Council has engaged Unified Community Sports & Leisure (UCSL) to Review the Concept Plan and Discuss Indicative Programs Recommend Indicative Operating Hours Discuss Management Options and Develop A Five Year Business Plan Methodology UCSL has reviewed the proposed re-development configuration and concept and has developed the response by applying a Management Methodology. UCSL has assessed the prevailing market conditions from the view point of an agency that has engaged to provide management services and has accordingly developed indicative Income, Expense and Attendance projections. A financial and service model has been prepared that reflects industry trends and UCSL s experience managing similar facilities located in similar rural locations. In addition the demographic profile of the has been considered to establish current and future population and likely demand for the services to be provided from a redeveloped Moss Vale Swimming Pool. The business model projection includes a six month set up / ramp up stage and a five year financial forecast which provides indicative financial results and the likely cost to council to sustain the facility operation and services. Three indicative five year financial and attendance forecasts have been prepared 1. Base forecast 2. Best Case forecast and 3. Low Case forecast The results have also been benchmarked against similar facilities to test the assumptions and findings. Commercial In Confidence 4

5 Proposed Concept Plan UCSL has reviewed the proposed redevelopment concept which is designed to provide A 25 metre 8 lane training pool ranging in depth from 1.2 metres to 2.05 metres A warm water activity pool ranging in depth from.7 metres to 1.5 metres A leisure and water play pool ranging in depth from 0.3 metres Multipurpose rooms consisting of a 70m2 space and a 20m2 space Water treatment plant and machinery areas Amenity areas including separate male, female and family change areas and Reception, Customers Service, Social Administration and Control areas Contemporary industry knowledge suggests, that to achieve financial viability and optimal service outcomes, aquatic facilities should offer areas that offer up to four different water types for clearly identifiable market segments and generous Gymnasium Fitness areas. The majority of aquatic facility market research indicates future complexes must equally cater for a number of distinct aquatic user markets being: Recreation and Leisure Market - usually made up of families, people coming with friends and groups for fun, relaxation, social activity and low level competition/participation. Competitive/Training/Fitness Market - usually made up of people predominantly attending facilities alone for structured fitness or competition activities. Education Market - usually made up of children and adults wishing to increase water safety and survival skills. Includes Learn to swim classes, school and club use and individuals improving their skills and techniques. They require hot water pools and water depths with some straight edges and easy water access etc. Health and Therapy Market - usually made up of children, adults and older adults wanting to relax or exercise in hot water. This market also includes specialist health condition groups such as arthritis, asthma suffers, etc. They require hot water pools and associated health relaxation areas, i.e. Spa/saunas, etc. Research throughout Australasia indicates that the recreation and leisure market will be the largest as it contains people of all ages, ability, types, interest and gender. The competitive/ training/fitness market is a more specialist market as it usually contains younger, fitter and more active people who have made time to train and compete. Previous research conducted into the Australasian recreation and leisure markets, indicates that in many cases 50% to 60% of facility users come from the recreation/leisure sector with 20% to 30% coming from the competitive/training/fitness markets. The health and therapy and education markets can range from 10% to 30% of the market subject to the age and health profile of the community in which the facility is located. The most successful aquatic centres attract all user markets and should be set up to allow people to participate in a range of activities at the one site. The further addition of gymnasium and fitness facilities, spas and saunas and social areas have been very successful at many aquatic facilities, as they add to the user experience and contribute to people being attracted to attend these facilities more often. Commercial In Confidence 5

6 Gymnasium Fitness areas have the potential to contribute significant income streams to a centre and play an important part in assisting a centre to achieve financial viability. The proposed Moss Vale redevelopment configuration is an un-sophisticated design and will provide services to a narrow range of potential users and will preclude a number market segments. With due regard to the final budget, consideration should be given to adding gymnasium fitness and spa and sauna components that will provide additional services and will contribute significantly to the financial viability of the centre. There are numerous successful aquatic centres that have been designed on the assumption that the centre will provide Gymnasium Fitness facilities with Aquatics as an add on, as opposed to the traditional design approach of an Aquatic centre with minimal gymnasium areas. The depth of the main 25 metre training pool should also be modified to reduce the amount of water required to be treated to provide the service. At the shallow end the depth should be 1.2 metres and increased to 1.3 metres at the deepest point. This reduction in depth will reduce the amount of water to be treated by 20-30% which will assist to reduce ongoing overheads with no impact on the level of service provided from the pool. Rather then compromise services provided from this pool this depth will provide a more useable space for elderly members of the community in the form of gentle exercise / walking, better cater for the education market and assist to provide a safer activity area. Gymnasium Fitness Component The amount of space provided for in the current Moss Vale Swimming Pool redevelopment does not provide an adequate amount of gymnasium fitness activity space and should be increased to circa 300 m2. Based on industry average of 3 members per square metre, an area of this size will provide for up to 900 fitness members and has the potential contribute in the vicinity of $500K per annum from 70,000 attendances following an month ramp up period. Without a significant gymnasium fitness component and the resulting income the Moss Vale Swimming Pool will be destined to operate with the need for council to provide a sizable annual, operational subsidy and the pressure will come to bare on centre management to contain costs. Health and Fitness participation is an activity which is able to be influenced by promotion and marketing and has the potential to provide increased centre awareness and appeal to a broad section of the community. As a result of the increased promotion and awareness, participation in both Aquatic and Health and Fitness gymnasium are greater if offered on a complimentary basis as opposed to stand alone offerings. The financial and utilisation improvement that results from the addition of the gymnasium health and fitness area is demonstrated in the section Five Year Business Plan Commercial In Confidence 6

7 Energy & Water Efficiency Two significant environmental opportunities are available to the owners of Aquatic Centres at the design stage, which if incorporated can provide ongoing annual financial efficiencies circa $50K per annum. Significant energy savings can be achieved by locating the pool hall to maximise the benefits of a northerly aspect thereby reducing air treatment requirements from either gas or electricity fired heat devices. Rain water harvesting and water recycling if included in facility design can provide ongoing efficiencies. The use of potable water, (which is predicted to become more expensive in the future), can be significantly reduced through the incorporation of rain water harvesting capability along with backwash water treatment capacity. The pay back period for this environmental investment varies depending on the scope and can be estimated in conjunction with an energy and hydraulic engineer. Typical pay back periods range from five to seven years. Location of Council Swimming Pool Development During the research for this report, the relative merits of the Moss Vale Swimming Pool site have been examined against the context of the provision of a similar aquatic facility at the municipal demographic centrally located, Bowral Swimming Pool site and there are clear advantages and disadvantages associated with both sites. A key consideration to locate the development at Moss Vale site has been to incorporate existing infrastructure into the redevelopment concept thereby reducing the overall cost of the redevelopment. The existing Moss Vale 33 metre pool structure requires extensive modification to incorporate an 8 lane 25 metre pool which will be a major component of the facility. The positive aspects associated with the development of the Moss Vale site are considered to be Close proximity to the Civic Centre / Library Hub and the Moss Vale commercial precinct The opportunity to redevelop an existing council leisure facility that requires upgrade to maintain service relevance The economic multiplier impact of the investment in the immediate area and The opportunity to incorporate shared electricity co-generation efficiencies with the proposed redevelopment of the Council Civic Centre Commercial In Confidence 7

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9 Management Options The selection of the appropriate management approach is essential to ensure that service and financial outcomes are maximised. The management of local government Aquatic Centres are characterised by two main models and variants which are 1 Directly Managed by Council employed staff 2a Outsourced via Management Agreement to a specialist company for periods 3-5 years 2b Outsourced via Lease Agreements to a specialist company for periods years in return for investment in to facility infrastructure The advantages and disadvantages are summarised below Advantages Direct Council Management Disadvantages Council retains responsibility for delivery of service outcomes Council assumes all financial and operational risk Adequate level of capitalisation to provide working capital Facility management can be constrained by slow moving council processes which can impact on speed to react to new trends or opportunities Facility cleaning, maintenance of plant and equipment is retained by council and is generally performed to a higher level than by outsourced providers Specialised industry program and sales and marketing knowledge is not always available from within the council structure Financial surpluses are retained and are able to be re-invested back into council Local government Award rates are generally 25-30% higher than leisure industry rates which adds a significant over head Council required to provide all equipment to operate the facility Commercial In Confidence 9

10 Advantages Outsourced Via Management or Lease Agreement Disadvantages Council retains responsibility for delivery of service outcomes via a contractual arrangements with an experienced industry operator Financial leakage can occur if the centre generates high levels of income / profit beyond what was anticipated this can be negated by incorporating profit sharing arrangements that reflect councils owner ship of the facility Financial and service risk is minimised through the transfer of some risk to the Contractor The scope of service outcomes, unless accurately prescribed in the contractual arrangements can be compromised as contractors will focus on the higher income earning activities Council is able to obtain specialised industry knowledge, contemporary sales and marketing expertise and operate with a structure that provides speed to react to opportunities Facility cleaning, maintenance and repair of plant and equipment can be variable and become the source of contention Centre overheads are reduced via the movement of centre staff to a leisure industry award Council has less control and influence of the day to day activities and outcomes and is required to performance manage the contract As part of the Management Offering, Contractors typically will provide activity equipment including IT, Fitness and Activity Equipment Depending on the length of the agreement entered into, the outsourcing term can be too long for Council if the performance of the operator is variable or too short for a contractor to receive an adequate return on investment Contractors are able to become investors into facility infrastructure in return for long term tenancy. This provides Council with a long term management partner. Council is exposed to risk of Contractor failure through inadequate working capital or poor business performance at the contracted facility or other facilities under management. An emerging hybrid approach is Direct Council Management which incorporates Council engaging the services of a specialised industry expert or company to provide ongoing advice regarding performance of the facility. Typically a quasi Board of Management is established, comprising relevant Council officers, community representatives and an industry expert and is charged with the responsibility of establishing strategy and policy to meet Council objectives and periodically review and guide performance. This approach is recommended in the event Council resolves to manage the facility via Direct Management. Commercial In Confidence 10

11 Indicative Programs The following table outlines the range of programs and activities and the percentage of users which is likely to be provided for from the various water spaces. The majority of customers are catered for from the Multi Purpose Leisure Pool which is the smaller body of water and uses a lower proportion of the overhead expenses. Typically the amount of water to be treated in this type of pool is 70% less than a 25 metre training pool. Programs & Activities User % Pool Type Swimming Training - General Fitness and Specific Training Squad Swimming - Swimming Club, Masters & Triathlon 20-25% 25 Metre Training Pool Learn to Swim - Children & Adults School Swimming - Education & Recreational Aquatic Industry Training Activities 25-35% Multipurpose Leisure Pool Aqua Exercise & Fitness Classes Fitness and Exercise Class - Combination Water and Dry Rehabilitation Water Assisted Exercise & Therapy Physiotherapy and Assisted Exercise Activities 5-10% Multipurpose Leisure Pool Spa & Sauna Water Play & Leisure Activities Recreational Swimming - Children s Birthday Parties & Club Events Social and Meeting Activities 50-60% Multipurpose Leisure Pool Commercial In Confidence 11

12 Indicative Operating Hours The financial modelling has been based on the following Hours of Operation which are characterised by Seven days per week operation Off Peak and Peak Hours of operation to reflect seasonal demand and During times of excessive heat conditions the centre should remain open until 7PM on weekends Opening Hours Open Close Hours Staffed Days Total Per Week May to September Monday - Friday 6AM 8PM Saturday Sunday & Public Holidays 9AM 4PM October to April Monday - Friday 6AM 8PM Saturday Sunday & Public Holidays 9AM 4PM Public Holiday Hours should reflect Saturday Sunday Trading hours depending on the applicable season. Commercial In Confidence 12

13 Indicative Customer Fees The suggested fee structure and resulting fees for customers to use the centre have been based on similar centres in NSW and reflects ability and propensity to pay for similar services. Moss Vale Swimming Pool Proposed User Fees Pool Fees Recreation Adult Swim $4.90 Birthday Parties Per Person Food 2 $16.00 Child Swim $3.80 Birthday Parties Per Person Food 3 $18.00 Concession $3.80 Spectator $2.50 Schools Family $15.00 School Swim - Education Department $1.95 Adult 20 Visits $88.00 School Stadium / Pool Entry $2.90 Concession 20 Visits $69.00 School Aqua Class $5.20 Monthly Pass - Adult $36.00 School Lesson Ratio 1:12 $5.00 Monthly Pass - Concession $30.00 School Lesson Ratio 1:10 $5.70 Monthly Pass - Family $78.00 School Lesson Ratio 1:8 $6.30 Inflatable Hire $58.00 School Lesson Ratio 1:7 $7.00 Aqua Class - Adult $11.00 School Lesson Ratio 1:6 $8.00 Aqua Class - Concession $9.20 School Lesson Ratio 1:5 $9.00 Aqua Class - Senior $7.50 Aqua Class 10 Visit $88.00 Health Club Aqua Class - Concession 10 Visit $78.00 Adult FN Debit $35.00 Adult FN Debit - Contract $30.00 Swim Club Concession FN Debit $27.00 Swim Club Casual - Concession $2.80 Concession FN Debit - Contract $25.00 Swim Club Casual - Adult $2.80 Family FN Debit $75.00 Swim Club Monthly - Concession $30.00 Swim Parent FN Debit $27.00 Swim Club Monthly - Adult $36.00 Corporate FN Debit $27.00 Swim Club Monthly - Family $78.00 Adult 3 month $ Squad 20 Visit - Concession $56.00 Concession 3 month $ Adult 6 month $ Learn To Swim Concession 6 month $ Swim Lesson $13.00 Adult 12 month $ Private Lesson $48.00 Concession 12 month $ Swim Workshops $9.00 A concession structure based on means tested concession entitlements as determined by various agencies is suggested to ensure that low income members of the community are not precluded. Accordingly as a minimum concession usage should be provided to holders of the following Health Care Card Centre Link Pension Concession Card Carer Card Pension Concession Card Veteran Affairs Gold Card All Conditions and Commercial In Confidence 13

14 University Student Full Time Five Year Business Plan The Business model has been prepared to project the financial implications and attendances likely to be experienced as a result of the redevelopment. A key measure of performance i.e. Subsidy per Visit has also been calculated to provide a measure to compare various scenarios and assist council to assess the relative merits. Over the first five years customer attendances and the operational financial implications for council are as follows. Moss Vale Swimming Pool Financial Projection & Key Indicator - Summary Year 1 Year 2 Year 3 Year 4 Year 5 Pre Open Projection Projection Projection Projection Projection Base Case -$48,987 Surplus / Deficit -$536,633 -$539,049 -$545,474 -$551,440 -$557,060 Attendances 78,251 82,563 87,523 93,226 99,785 Surplus / Subsidy Per Visit -$6.86 -$6.53 -$6.23 -$5.92 -$5.58 Best Case -$48,987 Surplus / Deficit -$494,863 -$499,464 -$500,919 -$501,082 -$499,918 Attendances 88,781 93,956 99, , ,622 Surplus / Subsidy Per Visit -$5.57 -$5.32 -$5.01 -$4.69 -$4.36 Low Case -$48,987 Surplus / Deficit -$570,183 -$584,430 -$597,171 -$610,558 -$624,906 Attendances 67,721 71,171 75,138 79,701 84,948 Surplus / Subsidy Per Visit -$8.42 -$8.21 -$7.95 -$7.66 -$7.36 The redeveloped facility will require financial support in the vicinity of $550,000 per annum to maintain the service. Non operational costs in the form of capital loan repayments will add an additional $920,000 ($8 mill plus interest over 15 years) per annum to total financial contribution required to establish and operate the facility. For the purposes of financial and service modelling the impact of the addition of a dedicated Gymnasium & Fitness component to the redevelopment has been calculated to demonstrate the outcomes in terms of cost to council and services to the community. Commercial In Confidence 14

15 The capital cost of this addition would be in the vicinity of $600,000 however should be assessed against the context of the ongoing operational subsidy. With the addition of the Gym & Fitness component income and attendances increase significantly which has the potential to provide a net surplus per visit as a contribution to the centre overheads, in the vicinity of $5.00 per visit. Gym & Fitness Component m2 Year 1 Year 2 Year 3 Year 4 Year 5 Gym Income $322,735 $527,956 $624,026 $642,746 $662,029 Equipment Lease & Repairs -$50,000 -$50,000 -$60,000 -$60,000 -$60,000 Additional Staff -$55,000 -$63,250 -$72,738 -$76,374 -$80,193 Additional Promotion -$10,000 -$10,000 -$10,000 -$10,000 -$10,000 Net Contribution to Centre Overheads $217,735 $414,706 $491,288 $506,372 $521,836 Number Members Attendances 43,825 76,683 87,263 87,263 87,263 Surplus /Subsidy Per Visit $4.97 $5.41 $5.63 $5.80 $5.98 When the net contribution is applied to the financial projections the operating subsidy required is reduced significantly, attendances increase and the net subsidy per visit is reduced. The resulting outcome is increased participation in fitness activities and less ongoing operational cost to council. Commercial In Confidence 15

16 Moss Vale Swimming Pool Financial Projection & Key Indicator - Summary With Gym Component Year 1 Year 2 Year 3 Year 4 Year 5 Pre Open Projection Projection Projection Projection Projection Base Case Surplus / Deficit With Gym Component -$318,898 -$124,343 -$54,186 -$45,068 -$35,224 Best Case Attendances 122, , , , ,048 Surplus / Subsidy Per Visit -$2.61 -$0.78 -$0.31 -$0.25 -$0.19 Surplus / Deficit With Gym Component -$277,128 -$84,758 -$9,630 $5,290 $21,918 Attendances 132, , , , ,885 Surplus / Subsidy Per Visit -$2.09 -$0.50 -$0.05 $0.03 $0.11 Low Case Surplus / Deficit With Gym Component -$352,448 -$169,724 -$105,883 -$104,186 -$103,070 Attendances 111, , , , ,211 Surplus / Subsidy Per Visit -$3.16 -$1.15 -$0.65 -$0.62 -$0.60 Commercial In Confidence 16

17 Attachments Supporting Information Moss Vale Swimming Pool Financial Projection & Key Indicator - Summary Year 1 Year 2 Year 3 Year 4 Year 5 Pre Open Projection Projection Projection Projection Projection Base Case Income $402,036 $455,751 $510,880 $575,296 $650,678 $48,987 Expenses $938,669 $994,800 $1,056,354 $1,126,736 $1,207,738 -$48,987 Surplus / Deficit -$536,633 -$539,049 -$545,474 -$551,440 -$557,060 Attendances 78,251 82,563 87,523 93,226 99,785 Surplus / Subsidy Per Visit -$6.86 -$6.53 -$6.23 -$5.92 -$5.58 Surplus / Deficit With Gym Component -$318,898 -$124,343 -$54,186 -$45,068 -$35,224 Attendances 122, , , , ,048 Surplus / Subsidy Per Visit -$2.61 -$0.78 -$0.31 -$0.25 -$0.19 Best Case Income $452,646 $506,284 $568,925 $642,201 $728,038 $48,987 Expenses $947,509 $1,005,748 $1,069,843 $1,143,283 $1,227,956 -$48,987 Surplus / Deficit -$494,863 -$499,464 -$500,919 -$501,082 -$499,918 Attendances 88,781 93,956 99, , ,622 Surplus / Subsidy Per Visit -$5.57 -$5.32 -$5.01 -$4.69 -$4.36 Surplus / Deficit With Gym Component -$277,128 -$84,758 -$9,630 $5,290 $21,918 Attendances 132, , , , ,885 Surplus / Subsidy Per Visit -$2.09 -$0.50 -$0.05 $0.03 $0.11 Low Case Income $356,526 $395,558 $440,932 $493,791 $555,477 $48,987 Expenses $926,709 $979,988 $1,038,103 $1,104,349 $1,180,383 -$48,987 Surplus / Deficit -$570,183 -$584,430 -$597,171 -$610,558 -$624,906 Attendances 67,721 71,171 75,138 79,701 84,948 Surplus / Subsidy Per Visit -$8.42 -$8.21 -$7.95 -$7.66 -$7.36 Surplus / Deficit With Gym Component -$352,448 -$169,724 -$105,883 -$104,186 -$103,070 Attendances 111, , , , ,211 Surplus / Subsidy Per Visit -$3.16 -$1.15 -$0.65 -$0.62 -$0.60 Commercial In Confidence 17

18 Year 1 Year 2 Year 3 Year 4 Year 5 Pre Open Projection Projection Projection Projection Projection Gym & Fitness Component m2 Gym Income $322,735 $527,956 $624,026 $642,746 $662,029 Equipment Lease & Repairs -$50,000 -$50,000 -$60,000 -$60,000 -$60,000 Additional Staff -$55,000 -$63,250 -$72,738 -$76,374 -$80,193 Additional Promotion -$10,000 -$10,000 -$10,000 -$10,000 -$10,000 Net Contribution to Centre Overheads $217,735 $414,706 $491,288 $506,372 $521,836 Learn To Swim Enrolments Number Members Attendances 43,825 76,683 87,263 87,263 87,263 Surplus /Subsidy Per Visit $4.97 $5.41 $5.63 $5.80 $5.98 Learn to Swim Enrolments T LTS Enrolments T LTS Enrolments T LTS Enrolments T Average Commercial In Confidence 18

19 Moss Vale Swimming Pool Financial Projection - Base Case Year 1 Year 2 Year 3 Year 4 Year 5 Pre Open Projection Projection Projection Projection Projection $ Income $ $ $ $ $ Swimming - Casual & Squads 110, , , , ,070 Swimming Membership 31,670 32,621 33,599 34,607 35,645 Aqua Classes 26,557 27,353 28,174 29,019 29,890 Learn to Swim Term & Vacation 151, , , , ,451 Re-Sale Kiosk 41,892 43,987 46,186 48,495 50,920 Resale Apparel 16,757 17,595 18,474 19,398 20,368 Schools Swimming 23,310 24,476 25,699 26,984 28,333 Total 402, , , , ,678 $ Expenditure $ $ $ $ $ 33,987 Wages and Oncosts 574, , , , ,279 8,000 Staff Training 4,000 4,120 4,244 4,371 4,502 Chemicals 10,000 10,300 10,609 10,927 11,255 Maintenance & Servicing 48,330 62,829 78,536 98, ,713 Consumables & Occupancy 8,000 8,240 8,487 8,742 9,004 IT Support 6,000 6,180 6,365 6,556 6,753 Program Expenses 8,000 8,240 8,487 8,742 9,004 Bank Charges 3,500 3,605 3,713 3,825 3,939 Insurance 9,000 9,270 9,548 9,835 10,130 Water 15,000 15,450 15,914 16,391 16,883 Security 2,500 2,575 2,652 2,732 2,814 Gas 35,000 36,050 37,132 38,245 39,393 Electricity 55,000 56,650 58,350 60,100 61,903 3,000 Printing / Stationary 6,000 6,180 6,365 6,556 6,753 Telephone 11,000 11,330 11,670 12,020 12,381 4,000 Promotion 10,000 10,300 10,609 10,927 11,255 Cleaning 25,000 25,750 26,523 27,318 28,138 Kiosk Purchases 23,041 24,193 25,402 26,672 28,006 Apparel Purchases 10,054 10,557 11,085 11,639 12,221 Council Overhead On Costs 75,000 77,250 79,568 81,955 84,413 48,987 Total 938, ,800 1,056,354 1,126,736 1,207,738-48,987 Surplus / Deficit -536, , , , ,060 Capital Costs -920, , , , ,000 Operational & Capital Costs -1,456,633-1,459,049-1,465,474-1,471,440-1,477,060 Subsidy Per Visit Key Drivers - Subsidy, Members & Enrolments Attendances 78,251 82,563 87,523 93,226 99,785 Facility Aquatic Members Learn to Swim Enrolments T LTS Enrolments T LTS Enrolments T LTS Enrolments T Average Enrolment Commercial In Confidence 19

20 Moss Vale Swimming Pool Financial Projection - Best Case 20% Increase in Key Income Areas LTS & Casual Swimming Year 1 Year 2 Year 3 Year 4 Year 5 Pre Open Projection Projection Projection Projection Projection $ Income $ $ $ $ $ Swimming - Casual & Squads 132, , , , ,884 Swimming Membership 31,670 32,621 33,599 34,607 35,645 Aqua Classes 26,557 27,353 28,174 29,019 29,890 Learn to Swim Term & Vacation 180, , , , ,997 Re-Sale Kiosk 41,892 43,987 46,186 48,495 50,920 Resale Apparel 16,757 17,595 18,474 19,398 20,368 Schools Swimming 23,310 24,476 25,699 26,984 28,333 Total 452, , , , ,038 $ Expenditure $ $ $ $ $ 33,987 Wages and Oncosts 583, , , , ,497 8,000 Staff Training 4,000 4,120 4,244 4,371 4,502 Chemicals 10,000 10,300 10,609 10,927 11,255 Maintenance & Servicing 48,330 62,829 78,536 98, ,713 Consumables & Occupancy 8,000 8,240 8,487 8,742 9,004 IT Support 6,000 6,180 6,365 6,556 6,753 Program Expenses 8,000 8,240 8,487 8,742 9,004 Bank Charges 3,500 3,605 3,713 3,825 3,939 Insurance 9,000 9,270 9,548 9,835 10,130 Water 15,000 15,450 15,914 16,391 16,883 Security 2,500 2,575 2,652 2,732 2,814 Gas 35,000 36,050 37,132 38,245 39,393 Electricity 55,000 56,650 58,350 60,100 61,903 3,000 Printing / Stationary 6,000 6,180 6,365 6,556 6,753 Telephone 11,000 11,330 11,670 12,020 12,381 4,000 Promotion 10,000 10,300 10,609 10,927 11,255 Cleaning 25,000 25,750 26,523 27,318 28,138 Kiosk Purchases 23,041 24,193 25,402 26,672 28,006 Apparel Purchases 10,054 10,557 11,085 11,639 12,221 Council Overhead On Costs 75,000 77,250 79,568 81,955 84,413 48,987 Total 947,509 1,005,748 1,069,843 1,143,283 1,227,956-48,987 Surplus / Deficit -494, , , , ,918 Capital Costs -920, , , , ,000 Operational & Capital Costs -1,414,863-1,419,464-1,420,919-1,421,082-1,419,918 Subsidy Per Visit Key Drivers - Subsidy, Members & Enrolments Attendances 88,781 93,956 99, , ,622 Facility Aquatic Members Learn to Swim Enrolments T LTS Enrolments T LTS Enrolments T LTS Enrolments T Average Enrolment Commercial In Confidence 20

21 Moss Vale Swimming Pool Financial Projection - Low Case 20% Decrease in Key Income Areas LTS & Casual Swimming Year 1 Year 2 Year 3 Year 4 Year 5 Pre Open Projection Projection Projection Projection Projection $ Income $ $ $ $ $ Swimming - Casual & Squads 88,240 92,652 97, , ,256 Swimming Membership 31,670 32,621 33,599 34,607 35,645 Aqua Classes 26,557 27,353 28,174 29,019 29,890 Learn to Swim Term & Vacation 128, , , , ,065 Re-Sale Kiosk 41,892 43,987 46,186 48,495 50,920 Resale Apparel 16,757 17,595 18,474 19,398 20,368 Schools Swimming 23,310 24,476 25,699 26,984 28,333 Total 356, , , , ,477 $ Expenditure $ $ $ $ $ 33,987 Wages and Oncosts 562, , , , ,924 8,000 Staff Training 4,000 4,120 4,244 4,371 4,502 Chemicals 10,000 10,300 10,609 10,927 11,255 Maintenance & Servicing 48,330 62,829 78,536 98, ,713 Consumables & Occupancy 8,000 8,240 8,487 8,742 9,004 IT Support 6,000 6,180 6,365 6,556 6,753 Program Expenses 8,000 8,240 8,487 8,742 9,004 Bank Charges 3,500 3,605 3,713 3,825 3,939 Insurance 9,000 9,270 9,548 9,835 10,130 Water 15,000 15,450 15,914 16,391 16,883 Security 2,500 2,575 2,652 2,732 2,814 Gas 35,000 36,050 37,132 38,245 39,393 Electricity 55,000 56,650 58,350 60,100 61,903 3,000 Printing / Stationary 6,000 6,180 6,365 6,556 6,753 Telephone 11,000 11,330 11,670 12,020 12,381 4,000 Promotion 10,000 10,300 10,609 10,927 11,255 Cleaning 25,000 25,750 26,523 27,318 28,138 Kiosk Purchases 23,041 24,193 25,402 26,672 28,006 Apparel Purchases 10,054 10,557 11,085 11,639 12,221 Council Overhead On Costs 75,000 77,250 79,568 81,955 84,413 48,987 Total 926, ,988 1,038,103 1,104,349 1,180,383-48,987 Surplus / Deficit -570, , , , ,906 Capital Costs -920, , , , ,000 Operational & Capital Costs -1,490,183-1,504,430-1,517,171-1,530,558-1,544,906 Subsidy Per Visit Key Drivers - Subsidy, Members & Enrolments Attendances 67,721 71,171 75,138 79,701 84,948 Facility Aquatic Members Learn to Swim Enrolments T LTS Enrolments T LTS Enrolments T LTS Enrolments T Average Enrolment Commercial In Confidence 21

22 Additional Financial & Attendance Tables & Commercial In Confidence 22

23 Additional Financial & Attendance Tables Commercial In Confidence 23

24 About Unified Community Sports and Leisure Unified Community Sports and Leisure (UCSL) presents an innovative community focused approach to Local Government Leisure Management with a mixture of expertise and entrepreneurial skills designed to deliver council s outcomes via a direct hands on approach from experienced senior staff. UCSL has contracts to manage six leisure facilities in Victoria and provides consultancy advice on a project basis. Being an operator of leisure facilities UCSL is well placed to provide advise regarding the operations of leisure facilities. Company directors have over 25 years of experience operating leisure facilities within the local government sector. Principals Unified Community Sports and Leisure Bernie Carroll - Director With a strong background in leisure business operations, Bernie has held senior roles with national leisure management companies over the past 15 years and has a track record of providing community focused leisure solutions within the public leisure sector. He brings a hands on style that resonates with both staff and customers and is experienced within public golf, aquatic, fitness and stadium settings. He has a track record of re-organising leisure service businesses, whilst balancing community needs to include high income producing outcomes and has become a specialist at incorporating health and fitness within a variety of settings that include traditional golf course, public leisure centres and high street locations. Roles have included Operations Director overseeing the growth of a leisure company, facility division management from $3mill to $18 mill turnover through the acquisition of nine leisure facility contracts comprising golf, fitness and aquatic facilities Assisting with the $12 mil re-development of a council / community leisure centre and overseeing customer growth to obtain 3,000 fitness and 2,400 learn to swim members National general manager for a chain of health clubs located within council leisure centres Bernie has formal management qualifications that include a Masters Business Administration and a degree in leisure management has also participated in a number of leisure industry agencies. Gerard Murphy - Director Having managed facilities on behalf of several councils, Gerard is known as one of Australia s longest serving independent facility managers. Gerard has always adopted a community focus in his management style and not been willing to employ unproven or junior managers as members of his key management team, believing that cheapest option is not always the best. Where other independents have gone by the wayside or compromised their beliefs by working with other bigger organisations Gerard chose to reduce his dependence on this field and move into other areas of business. He has recognized that the time has come to put forward our alternative in the management of council facilities. Commercial In Confidence 24

25 Ron Bongetti Advisor With 25 years experience in the Sports and Recreation Industry Ron has a proven history as a leader and manager at senior management level. Having worked for some high profile sporting organizations during this period Ron won the 1995 Victorian Sports Administrator of the Year. He moved onto the Board of VicSport, the body charged with the responsibility of offering advice to the Minister of Sport, Recreation and Youth Affairs. Ron has leisure management curriculum vitae full of experience in managing organisations that have enjoyed success following his involvement. Included in these are the following achievements Three National Basketball League titles Winning and staging FINA Swimming World Cups Winning the FINA Swimming World Championships bid Acting as an ambassador in Melbourne s 2006 Commonwealth Games bid Creating the E. J. Whitten Foundation and staging the inaugural AFL E. J. Whitten Legend s Match. Ron has been employed or engaged as a consultant by the following sporting organisations Swimming Victoria, Western Bulldogs Football Club, Brisbane Bullets, North Melbourne Giants, Swimming Australia, Boxing Australia, Softball Australia, Victorian Water Polo, Diamond Valley Basketball Association, Knox Basketball Association, AustSwim Victoria and Life Saving Victoria. UCSL Philosophy Unified Community Sport and Leisure believe is committed to Modelling the values of play, recreation, and sport as a means of well-being and wellbeing for self, others, and society within the community Partnership with Council to increase community participation in building activities that link the physical development of recreation and leisure to mental stimulation and the importance of balance and behaviours of living the "good" life within a community Provide management that encourages the community to frequent leisure facilities more often and Assisting people of all abilities and backgrounds to identify and pursue their fitness or sporting aspirations, regardless of cost. Commercial In Confidence 25