Financial Column

FY 2022 RECAP

August marked the end of fiscal year (FY) 2022 for the Club. Considering that the country was rebounding from a pandemic when the fiscal year began, I am happy to report that the Club experienced solid financial performance which provided the resources to enhance the Member experience in many impactful ways throughout the year.

The Club launched two major improvements during the fiscal year, the renovation of the Downtown Clubhouse’s famed Jack Buck Grille, and the renovation of the 1903 Dining Room in the West Clubhouse. The new furniture for the Jack Buck Grille has arrived, adding the finishing touches and setting the stage for extraordinary experiences – think Cardinal’s games, post-event celebrations, themed dinners, and more. By the time this article hits your door, the 1903 Dining Room will be open—the perfect complement to the 1903 Bar. This is your new go-to spot for breakfast meetings, business lunches, family dinners and exclusive celebrations. It’s the best restaurant in town that you can’t get into unless you’re a Member of the Missouri Athletic Club!

Other downtown capital improvements include the replacement of incline trainers/treadmills, a new HVAC unit for 5M, three new pieces of kitchen equipment and Zoom Room functionality. In addition to the 1903 Dining Room renovation at West, we’ve upgraded four HVAC units, replaced tennis curtains, installed a fiber optic internet connection and new Wi-Fi access points, and purchased two new Palisade climbers.

Our year-end Membership headcount was 2,535, up 183 from August 2021. When the Membership level exceeded 2,500, the Club initiated a waitlist for access to the West Clubhouse in an effort to provide the best experience for our Membership. This strategy has been well-received, and new Members have quickly transitioned off the waitlist.

Operating revenues for the year totaled $12.6 million compared to $8.7 million in FY 2021, $8.6 million in FY 2020 and $12.2 million in FY 2019. Our overnight rooms business generated $1.3 million in revenue, which is within $100,000 of our 2019 all-time high-water mark. Downtown Food and Beverage revenues reached nearly $4.4 million, just ahead of 2019 revenues. West Food and Beverage revenues topped $3.2 million, also ahead of 2019 revenues.

Of course, the other side of the coin is that the Club has been impacted by increasing prices for everything from wages and benefits, food and beverage products, and Cherry Diamond magazine printing to cleaning supplies, pool chemicals and natural gas.

The Club’s bottom line operating cash flow for the year was $1.7 million which was $184,000 less favorable than budget but $1.1 million ahead of last year. Operating cash flow levels prior to the pandemic were in the $2 to $2.2 million range. This level provides ample resources for principal payments on debt and much-needed capital improvements. Next year’s budget projects an operating cash flow of $1.9 million. To get there, the Board of Governors unanimously approved a 6.5% dues increase that was effective Sept. 1, as reflected on your August statement. The average increase across all Membership categories is less than $14 per month. This will provide the cash flow needed for enhancing the Club’s facilities at both Clubhouses during FY 2023. Members will experience numerous improvements in many areas of the Club, such as cardio equipment replacements, a refresh of the Downtown 5M locker room, updates in the West Pro Shop, new carpet, lighting, paint and other items for the men’s and women’s locker rooms at West and pool area upgrades at both Clubhouses.

As of the end of August, the Club had long-term bank debt of $8,697,000 and MAC Redevelopment Corp., which owns our garage, had long-term debt of $732,000. In May of this year, the Club took out a new loan of $3,000,000 for the purpose of fully funding our employee pension obligation. This will allow the frozen pension plan to be terminated. Thanks to favorable market performance and increasing interest rates, our consultants have good reason to believe that we will be able to purchase annuities for our eligible employees for much less than originally anticipated, which will leave a cash surplus in our Pension Sinking Fund. Stay tuned for more details as the process unfolds.

Our line of credit has been on standby during much of the fiscal year, having been accessed only three times. The amounts borrowed were minimal, and were paid back within just a few days. This is a result of the Club’s improved working capital position. In addition, our operating reserve fund remains intact and available for future opportunities.

The Club’s solid financial foundation is a product of our planning process based on The 4A’s; setting the Agenda, Allocating the resources, Activating the work and Accounting for the results. The outcome is a 10-year Financial Roadmap that enables the fulfillment of the Vision and Mission of the MAC.

If you have any questions regarding the Club’s finances, please contact the Club’s Chief Financial Officer, Pam Roth, at 314-539-4400 or proth@mac-stl.org.

Pam Roth, Chief Financial Officer Missouri Athletic Club