82 01 March 2017
Finance and Performance Committee
20 January 2017
Report no: FPC2017/1/71
Seaview Marina Limited Six Month Report to 31 December 2016
Purpose of Report
1. To provide the Committee with an update for Seaview Marina Limited (SML), for the six month period to 31 December 2016.
That the Committee receives the half year report from Seaview Marina Limited attached as Appendix 1 to the report.
2. The Local Government Act requires Council Controlled Organisations (CCO’s) to deliver to shareholders a half yearly report on the organisation’s operations within two months after the end of the first half of each financial year. The report should include information required to be reported as outlined in the organisation’s 2016/2017 Statement of Intent.
3. The Chair and General Manager of SML will be in attendance to present their report and answer any questions.
4. Overall, SML reported a surplus of $144,908 for the 6 months to 31 December 2016 - just over $20,000 unfavourable to budget. Unfavourable revenue and favourable business as usual expense variances offset each other resulting in an ‘on budget’ business as usual result, with the overall unfavourable variance to budget due to necessary repair costs incurred as a result of the November 2016 earthquake.
5. The revenue shortfall is due to difficulties in filling the new 12m berths, partially offset by better than expected results for the hardstand activities.
6. Operational expenses are higher than planned due to costs incurred as a result of the November 2016 earthquake.
7. Depreciation and finance charges are lower due to the decision taken to place the commercial pier development on hold until berth occupancy improves.
8. Occupancy rates for both the trailer park and berth storage are currently operating at 100% and 83% respectively. Berth storage is lower than planned due to difficulties in filling the 12m berths.
9. The Marine Centre has had only one tenancy vacant over the first six months of this financial year. YTD the income for the six months is 100% of budget. Four units were due for renewal at the end of 2016 and these have all been renegotiated and signed off. The Board was successful in achieving an average rental increase of 21.5% for the four units.
10. Additional berth developments planned for this financial year have been postponed until berth occupancy figures improve. Investigations are progressing on widening the travel lift dock way and providing a maintenance pier for contractors to work on vessels in the water.
11. Cash flows have been strong. Cash surpluses from operations have been used to fund capital expenditure and to reduce the current account balance with HCC. During the 6 months, the current account balance was reduced from $449,074 to $189,535 (and to $50,551 by the end of January 2017).
12. Total equity at 31 December 2016 was $5,558,254.
13. No options are presented.
14. No requirement for further consultation.
15. No further legal considerations noted.
16. No additional financial considerations noted.
17. No other considerations noted.
Seaview Marina Six Month Report to 31 December 2016 (Under Separate Cover)
Author: Sharon Page
Senior Management Accountant
Approved By: Brent Kibblewhite
Chief Financial Officer