HANMER SPRINGS THERMAL POOLS & SPA

Hanmer Springs Thermal Pools & Spa Management Committee AGENDA FOR AN ORDINARY MEETING TO BE HELD ON:

THURSDAY 7 NOVEMBER 2013 COMMENCING AT 9 AM IN THE MEETING ROOM, HERITAGE HOTEL, HANMER SPRINGS

Community Partnership in growth and wellbeing.

Committee Membership: Grant Lilly (Chairperson) (Independent member) Mayor Winton Dalley Cr Gary Cooper Cr Jason Fletcher Cr Fiona Harris Tony Sewell (Independent member) HSCB representative (yet to be appointed)

Graeme Abbot (General Manager HSTPS) Jason Beck (HDC Manager Financial Services) Quorum: no less than 3 members

Purpose of local government (1)

(2)

The purpose of local government is – (a)

To enable democratic local decision-making and action by, and on behalf of, communities and

(b)

To meet the current and future needs of communities for good quality local infrastructure, local public services, and performance of regulatory functions in a way that is most cost-effective for households and businesses.

In this Act good-quality, in relation to local infrastructure, local public services, and performance of regulatory functions, means infrastructure, services and performance that are – (a) Efficient: and (b) Effective: and (c) Appropriate to present and anticipated future circumstances

(Local Government Act 2002 – Amendment Act 2012)

1

HANMER SPRINGS THERMAL POOLS & SPA Minutes of a Meeting of the Management Committee Held at the Heritage Hotel Hanmer Springs on Tuesday 13 August 2013 at 9.00am PRESENT:

Mr Grant Lilly (Chairman), Mayor Winton Dalley, Cr Michael Malthus, Mr Jason Beck, Mr Jason Fletcher, Mr Tony Sewell, Cr Gary Cooper and Mr Andrew Dalziel

IN ATTENDANCE:

Mr Graeme Abbot (General Manager)

APOLOGIES:

Mr Graham Sutherland (Secretary)

URGENT BUSINESS:

Nil

CONFLICTS OF INTEREST DECLARATIONS: There were no declarations of Conflict of Interest. 1. MINUTES OF PREVIOUS MEETING: THAT THE MINUTES OF THE MEETING DATED 29 JUNE 2013 BE TAKEN AS READ AND WITH THE FOLLOWING CORRECTION BE SIGNED AS A TRUE AND ACCURATE RECORD OF THAT MEETING. Last paragraph page 3 delete “$1” Cooper/Malthus

CARRIED

2. ACTION ITEMS/MATTERS ARISING: The action items register was reviewed, and various matters noted. These to be recorded on the updated register from the meeting. Methane Gas:

Item to be removed from the action list, as the BECA report has been circulated.

Changing Rooms:

Graeme to prepare paper on how to project manage the changing rooms upgrade, and what project cost reductions can be achieved.

Café Redevelopment: Alter date from October to December. Long Term Plan:

Alter date from October to December.

Financial Reviews: The Chairman to seek an independent review of the Equity accounting and Funding methodology presently applied to the HSTPS financials. Spa Pedicure Room:GM to send a proposal out to Committee members, when ready. Accounting Resources: The GM and Jason Beck to review accounting resources by October meeting.

2

Marketing Report:

A more detailed report to be provided each month.

Signage:

Carried forward to October meeting.

Pricing Strategy:

Actioned.

Spa Retail:

Carried forward to October meeting.

I Site renovation:

GM to bring final proposal to October meeting.

Review of Public Excluded: The Chairman to develop a new standard format for the Open and Public Excluded sessions of Committee Meetings. 3. BUSINESS 3.1 DECISION MATTERS: Changing Rooms Upgrades: The changing rooms were discussed. Andrew Dalziel commented on the building code, and the Councils policy on this issue. The GM is to investigate options to carry out reinforcing work urgently. The GM to make staff aware of the situation. The GM spoke to the tabled paper. It was agreed that option 3, the combined changing room and offices option, was not viable. It was agreed that option 2, which related to separate offices, should be left on the table at present and be revisited once the changing rooms refurb was completed. After general discussion the following motion was put.

THAT IN PRINCIPLE THE CHANGING ROOM PROJECT WOULD PROCEED IN APRIL/MAY 2014. THE GM TO PROVIDE A PLAN WHICH DETAILS THE FOLLOWING: 1) How the project will be managed 2) How substantial savings in the project cost could be made 3) How this project might impact on any long term plan strategies This paper to be put to Committee prior to the October meeting. Fletcher/Dalley

CARRIED

Pedicure Room: The GM explained that due to The Spa Manager being away progress has not been made. The GM will circulate a paper to the Committee once the proposal is finalised. Should the Committee be in favour the proposal can be approved by email. Staffing Numbers: The GM to give a further breakdown of staff numbers to include permanent full time numbers, and permanent part time numbers, as FTES.

3

Sulphur Pools: The GM tabled a paper on the sulphur pools with a cost estimate of $90,000. THAT THE COMMITTEE APPROVE THE INVESTMENT IN THE UPGRADE WITH CONSTRUCTION DUE IN OCTOBER/NOVEMBER. Cooper/Beck

CARRIED

Motor Vehicle: Motor Vehicle: The Chairman confirmed that a comparison of the cost for the replacement Ute, between the quote previously obtained, and the cost via the Council system, had been done, and the purchasing as per the quote actioned as the best option. 3.2 DISCUSSION MATTERS: Pricing Strategy:

General discussion was held over the pricing strategy. Various options and considerations to the proposed plan were discussed. It was agreed that Pricing should be reviewed on an annual basis. Next review being April 2014 – Action Sheet

Cafe Heating:

The General Manager discussed the potential for underfloor heating as an alternative option to the heat exchanger. After discussion the following was put: THAT THE OPTION OF HEATING THE CAFE WITH THERMAL WATER BE EXPLORED AND INSTALLED PROVIDING THE COST OF INSTALLATION IS LESS THAN THE APPROVED HEAT PUMP COST. Fletcher/Sewell

Discharge Bore:

CARRIED

The General Manager advised the meeting that the issue is not algae but iron build up and that work was being undertaken to investigate the issue. Further updates to be given.

3.3 GENERAL MANAGER’S REPORT: Financial Report: The GM spoke to the financial report for the year end June 2013 explaining the variances. The Committee asked the GM to convey it’s thanks to the management team for their endeavours of reaching 98% of profit budget after what was a poor first six months of the year. Jason Beck presented the statement of financial position explaining the Council’s position on Non Current Liabilities and Net Surplus. Tony Sewell queried the policy on depreciation. This will be covered in the independent review being undertaken by the Chairman.

4

The Committee discussed and acknowledged receipt of the year end accounts, and approved the accounts. The Committee has asked that the HDC CFO present the accounts to HDC Audit & Risk Committee. The following reports were accepted/discussed: • Marketing • Health & Safety • Operations • Projects • Super Sale Analysis

3.4 GENERAL BUSINESS In committee only time the Committee discussed and approved proposed bonus capabilities of the General Manager, for the year just finished, and the year going forward. The Chairman to discuss with the General Manager. Register of Interests: No changes to the register of interest are required. 4. PRESENTATION Scott Callaway joined the meeting at 12:30pm to present the marketing plan for the next 12 months. General discussion ensued and Scott was thanked for his work.

5. URGENT BUSINESS Nil

6.NEXT MEETING:

The next meeting is scheduled to be held on October 22nd 2013 at Heritage Hanmer Springs commencing 9am.

The meeting closed at 1:35pm.

5

To:

Hanmer Springs Thermal Pools and Spa

Date:

7 November 2013

Significant Decision:

No

Management Report for the month of September Recommendation Executive Summary Background

THAT THE INFORMATION BE RECEIVED The Report from the General Manager is attached. The Report from the General Manager includes the following items – •

Action List

•

September Financial Reports

•

Marketing statistics

•

Health and Safety

•

Bore Report

•

Operations Report

•

Project Update

•

Projects

•

Staffing numbers

•

Signage

Appendices

Management Report for September 2013

Report Prepared by:

Graeme Abbot General Manager

Officer in Attendance: The report author will be in attendance to speak to their report.

6

MANAGEMENT REPORT FOR THE MONTH OF SEPTEMBER 2013 CONTENTS Action List September Financial Reports • Surplus • Pools • The Spa • GardenHouse Cafe • I-Site • Balance Sheet Accruals Marketing Statistics Health & Safety Bore Reports Operations Project Update Projects Staffing Numbers Signage

Page 2 Page 3 Page 4 to 6 Page 7 & 8 Page 9 & 10 Page 11 & 12 Page 13 Page 14 Page 15 to 21 Page 22 Page 23 & 24 Page 25 Page 26 & 27 Page 28 & 29 Page 30 Page 31

7

ACTION LIST FROM AUGUST MEETING HANMER SPRINGS THERMAL POOLS & SPA

Subject

Action Required

1

Changing Rooms

Graeme to prepare paper on how to project manage the changing room upgrade.

2 3

Café Redevelopment Long Term Plan

Front of House work to be discussed after August Workshop Develop a 5/7 year plan

4

Financial review

5

as at September 2013 By

Action

October

Update included in October papers.

October

Draft in progress.

Graeme

December

Draft paper to be circulated.

Grant to seek an independent review of the accounting methodology presently applied to the HSTPS financials.

Grant

December

Due December

Spa Pedicure Room Accounting resources

Graeme to send a report out to committee members Provide a review of the adequacy of accounting expertise, resources and processes in the business

Graeme

September

Deferred until March 2014

Jason B and Graeme

October

Plan being developed for staffing levels across complex.

7

Marketing

Graeme

Ongoing

In action

8

Signage Spa retail

Graeme & Fletch Graeme

October

9

A more detailed report to be provided each month Meet with Council Officer regarding signage Investigate the possibility of one person, or other dedicated resource, for selling product at The Spa

Have met with officers and will report at meeting. Determined that this was not financially viable.

6

Graeme

When

October

10

Headcount/FTE establishment

Report to include detail of permanent full time numbers and permanent part time numbers.

Grant and Jason B

October

Included in October papers.

11

Review of Public Excluded Agenda

Develop a new standard format for the Open and Public Excluded session of the Committee meetings

Grant and Jason B

October

To be actioned

12

Isite renovation

Final plan and capex proposal required

Graeme

October

Awaiting final costings

8

Profit and Loss Report FOR THE PERIOD ENDED 30/09/2013 Actual

Budget

Last Year

Actual

Budget

Last Year

Annual Budget

SURPLUS: Surplus - Pools Surplus - The Spa Surplus - Cafe Surplus - i-Site Sponsorships Rent -i-Site Rent - SPA Rent - Bank Rent - Garden House Cafe NET SURPLUS BEFORE INTEREST

(12,072) 16,393 (3,134) (3,096) 10,351 2,083 750 833 5,833 17,942

596 18,051 (6,082) 594 4,167 2,083 750 833 5,833 26,825

75,306 11,967 (3,431) (8,365) 4,369 2,083 750 833 5,833 89,346

(97,763) 73,851 (6,830) 398 14,081 6,249 2,250 2,500 17,499 12,234

(102,122) 73,953 (21,246) 1,423 12,501 6,249 2,250 2,499 17,499 (6,994)

(62,773) 70,995 (14,372) 4,666 15,725 6,249 2,250 2,500 17,499 42,739

1,497,987 356,400 93,000 13,000 50,000 25,000 9,000 10,000 70,000 2,124,387

17,942

26,825

89,346

12,234

(6,994)

182 182 42,921

2,124,387

INTEREST RECEIVED - Call Account NET SURPLUS AFTER INTEREST

9

Hanmer Springs Thermal Pools FOR THE PERIOD ENDED 30/09/2013 Actual

Budget

Last Year

Actual

Budget

Last Year

Annual Budget

SURPLUS Pool Receipts Coin Operated Lockers Pools Merchandise

420,903 10,116 497

441,792 11,133 1,000

408,222 11,229 797

1,501,294 37,420 1,585

1,445,690 36,431 3,000

1,314,771 36,797 1,784

6,735,000 170,000 12,000

431,516

453,925

420,248

1,540,299

1,485,121

1,353,352

6,917,000

1,887 1,066 6,203 163,324 172,480

2,000 1,667 1,200 4,833 167,144 176,844

2,765 720 5,223 155,386 164,094

1,297 16,224 3,278 19,561 559,578 599,937

2,000 16,936 3,600 13,999 547,270 583,805

1,297 8,631 2,369 20,213 472,521 505,031

8,000 75,000 18,000 45,000 2,206,013 2,352,013

8,789 33,021 136 2,638 11,937 51,465 596 805 1,743 111,131

12,083 33,250 333 1,667 12,500 52,000 4,500 1,000 1,667 119,000

6,986 33,788 246 260 10,781 1,143 269 739 1,940 56,151

34,952 113,980 407 79,692 50,778 79,723 16,102 3,420 5,712 4,159 388,927

36,249 105,750 999 80,001 52,500 56,000 9,500 3,000 5,001 5,000 354,000

30,309 106,448 792 102,719 21,237 45,063 289 1,883 5,040 6,670 320,448

145,000 365,000 4,000 115,000 85,000 144,000 40,000 12,000 20,000 20,000 950,000

667 2,818 2,675 1,118 167 786 1,256 9,487

500 3,000 1,500 1,667 167 1,500 1,667 10,001

97 2,889 966 1,496 1,399 1,319 8,165

1,708 10,164 4,917 5,048 334 3,660 217 21,839 3,896 51,784

1,500 9,000 7,000 5,001 334 4,500 250 20,000 5,001 52,586

1,238 8,392 4,334 4,166 3,231 217 12,917 5,193 39,689

6,000 36,000 23,000 20,000 1,000 18,000 1,000 35,000 20,000 160,000

LESS EXPENSES PERSONNEL COSTS Fringe Benefit Tax Protective Clothing & Uniforms Staff Expenses Training Wages-Pools Personnel expenses

OPERATIONS Chemicals - Water Treatment Electricity/Gas Equipment Hire R&M - Pools R&M - Pumps/Plant R&M - Buildings/General R&M - Picnic and Gardening Security Waste Removal Water Rates Operations expenses

MATERIALS & SERVICES 1st Aid Supplies Cleaning Chemicals Costumes & Towels Freight Petty Cash Printing & Stationery Rates Return/Waterslide Passes Telephone & Tolls Materials & services expenses

10

EXTERNAL SERVICES Advertising/Promotional Consultants Fees Recruitment Fees Management Committee Legal Fees External services

58,999 55 6,458 65,512

55,833 667 417 7,700 417 65,034

36,274 1,875 304 6,441 44,894

170,757 55 14,038 1,500 186,350

167,499 2,001 1,251 12,500 1,251 184,502

141,150 11,675 2,230 6,441 161,497

670,000 8,000 5,000 50,000 5,000 738,000

3,481 6,060 4,199 50 1,048 3,057 4,459 420 22,773 381,382 50,133

5,833 6,000 600 600 2,917 1,667 833 18,450 389,329 64,596

3,218 60 78 114 5,000 1,441 1,158 11,070 284,373 135,875

14,328 6,120 4,719 726 180,910 7,145 4,382 4,555 222,887 1,449,885 90,415

17,499 8,000 1,800 1,800 175,000 8,751 5,001 2,499 220,350 1,395,243 89,878

11,524 10,502 708 633 168,102 4,589 5,071 6,341 207,470 1,234,135 119,217

6,000 70,000 40,000 15,000 10,000 205,000 35,000 20,000 40,000 10,000 451,000 4,651,013 2,265,987

Ordinary Depn

62,205 62,205

64,000 64,000

60,569 60,569

188,178 188,178

192,000 192,000

181,990 181,990

768,000 768,000

Pools Surplus

(12,072)

596

75,306

(97,763)

(102,122)

(62,773)

1,497,987

GENERAL EXPENSES Audit Fees Bank Fees Computer Software/Support Entertainment General Expenses Insurance/ACC Motor Vehicle Travelling Expenses Carpark Lease Subscriptions & Conferences General expenses TOTAL EXPENSES NET SURPLUS BEFORE DEPN

LESS DEPRECIATION

SEPTEMBER

11

Pool receipts for the month of September were $20,889 down on budget but up 3% on last year. Expense control for the month was very good with no expenses outside of $5,000 variance either way from budget. Expense ended up $7,947 under budget which resulted in a $12,079 loss against a budgeted profit of $596 for the month.

Year to Date Year to date revenue is $55,178 ahead of budget representing growth of 14% over last year. A loss of $97,763 is $4,359 better than budget loss of $102,122. Overspends or timing variances that will come back in line over the next 9 months are as follows. Electricity/Gas R&M Buildings R&M Picnic/Gardening Insurance

$ 8,230 $23,723 $ 6,602 $ 5,910 $44,465

$44,465 added back in to the year to date result would give a loss of $53,298 a positive variance of $48,824 from budget.

Wages as a % of Turnover Yield Slide conversion rate Private Pools occupancy

Actual 38% $13.55 25% 14%

Month Budget 37% $13.10 23% 18%

Last Year 37% $11.96 22% 18%

Actual 36% $12.99 24% 16%

Year to Date Budget 37% $12.99 22% 19%

Last Year 37% $11.82 22% 19%

The Spa at Hanmer Springs

12

FOR THE PERIOD ENDED 30/09/2013 Annual Actual

Budget

Last Year

Actual

Budget

Last Year

Budget

REVENUE FROM Alpine Aqua SPA Receipts SPA Retail

1,268 97,297 5,953

2,500 105,000 7,000

1,633 87,603 6,322

3,877 337,091 17,332

7,500 330,000 21,000

2,941 305,232 20,568

30,000 1,455,000 84,000

104,518

114,500

95,558

358,299

358,500

328,741

1,569,000

Rent Cleaning Supplies Massage Oil/Beauty Products Retail Beauty Products General Expenses Printing & Stationery Repairs & Maintenance Telephone & Tolls Training Wages - Spa TOTAL EXPENSES

750 6,500 4,962 1,697 3,493 4,000 123 62,346 83,871

750 7,500 8,333 2,917 3,833 333 5,333 300 2,000 60,900 92,199

750 7,276 2,549 3,207 4,687 55 5,420 81 55,341 79,367

2,250 23,513 23,415 8,102 11,251 652 4,981 685 1,445 195,423 271,718

2,250 23,000 24,999 8,751 11,499 999 5,999 900 2,000 191,400 271,797

2,250 23,366 13,828 8,014 13,835 1,146 5,420 1,019 2,081 174,114 245,073

9,000 100,000 100,000 35,000 46,000 4,000 10,000 3,600 8,000 846,000 1,161,600

NET SURPLUS BEFORE DEPN

20,647

22,301

16,191

86,582

86,703

83,668

407,400

Ordinary SPA Depn

4,254

4,250

4,224

12,731

12,750

12,673

51,000

Ordinary Depn & Loss on Sale

4,254

4,250

4,224

12,731

12,750

12,673

51,000

16,393

18,051

11,967

73,851

73,953

70,995

356,400

LESS EXPENSES

SPA REVENUE

The Spa

13

Turnover of $104,518 is $9,982 down on budget and 9% up on last year. Expense control for the month has been good resulting in savings of $9,398. This has meant that a surplus of $17,463 has been generated against a budget of $18,051 for the month. A very good result considering revenue budget was missed.

Year to Date Revenue for the year is 10% up on last year and in line with budget. Expenses are in line with budget resulting in a surplus of $74,921 which is marginally ahead of budget.

Turnover Treatments Occupancy vs Staff Availability Hours Utilised Utilisation vs Capacity Yield

Month Actual $104,518 1,236 79% 1,659 56% $84.56

Last Year $95,558 1,244 82% 1,459 39% $76.81

Year to Date Actual $358,299 4,212 80% 4,770 48% $85

Last Year $328,741 4,108 82% 4,391 38.66% $79.91

GARDENHOUSE CAFE

14

FOR THE PERIOD ENDED 30/09/2013 Actual

Budget

Last Year

Actual

Budget

Last Year

Budget Full Year

CAFE TRADING ACCOUNT REVENUE FROM Cafe Receipts TOTAL SALES

46,620 46,620

42,000 42,000

43,407 43,407

144,013 144,013

126,000 126,000

136,188 136,188

840,000 840,000

19,985 13,880 5,967 849 (21,026) 19,655 26,966

9,250 4,250 1,000 14,500 27,500

30,500 10,770 4,813 2,129 (30,500) 17,712 25,695

22,698 37,446 14,188 1,483 (21,026) 54,789 89,224

27,750 12,750 3,000 43,500 82,500

37,113 33,094 9,201 3,271 (30,500) 52,180 84,007

185,000 85,000 20,000 290,000 550,000

2,333 114 592 5,833 90 21,137 30,099 (3,134) (3,134)

2,500 2,333 417 333 250 5,833 833 833 83 167 20,000 33,582 (6,082) (6,082)

2,333 720 413 5,833 19,827 29,126 (3,431) (3,431)

6,999 346 1,489 581 17,499 894 270 67,976 96,054 (6,830) (6,830)

2,500 6,999 1,251 999 750 17,499 2,499 2,499 249 501 68,000 103,746 (21,246) (21,246)

6,999 1,330 837 365 17,499 1,014 437 209 69,690 98,379 (14,372) (14,372)

5,000 28,000 5,000 4,000 3,000 70,000 10,000 10,000 1,000 2,000 319,000 457,000 93,000 93,000

LESS COST OF SALES COST OF GOODS SOLD Opening Stock Dry goods, fresh & frozen Coffee & beverages Alcohol purchases Less Closing Stock TOTAL COST OF GOODS SOLD GROSS MARGIN - CAFE

CAFE EXPENSES Advertising Electricity & gas General Expenses