Q.E. II — year’s loss $50,000 to $300,000?

Press, Volume CXIV, Issue 33654, 2 October 1974, Page 18

Q.E. II — year’s loss $50,000 to $300,000?

Figures for the running of Queen Elizabeth II Park for the first five months of the financial year suggest that unless there is a dramatic improvement in receipts, the loss for the year might be as high as $300,000, rather than the $50,000 loss budgeted for by the Christchurch City Council.

However, the park’s manager (Mr F. B. Jenkings) says he has every confidence in the complex, and feels that there will be a big improvement in income during the second half of the financial year.

So far, the park has been open in what is traditionally the slackest time of the year for such ventures. Mr Jenkings says that up to onethird of the complex’s total annual income might be taken in December and January. If running costs do show a loss of $300,000 this financial year, the total cost of the complex, including loan charges for the year of $200,000, will be nearly $500,000. This is equivalent to about 10 per cent on city rates. It seems likely that the situation at the end of the year might lie between the council’s estimate of a $50,000 working loss, and the “worst likely" result—based on receipts to date—of a $300,000 loss. “HAVE TO RISE” Mr Jenkings acknowledges that the complex’s income for the first five months has averaged $10,400 a month, and that to reach the council’s estimate, this will have to rise to $52,000 a month for the rest of the financial year. But he says that on the’ basis of his experience in such ventures, and as far as he can estimate with what is basically an untested venture, the receipts will be close to this figure. September receipts show a 50 per cent rise on August, and will total about $17,000. Almost 44,000 people visited the complex during the month. Budgeted income for the pool for the year is $BB,OOO, and $16,495 was taken in five months — admittedly the slackest of the year—leaving $71,500 to come in the remaining seven months, an average of $10,214 a month. Mr Jenkings feels this will be attained. Concerts in the stadium are budgeted to bring in $BO,OOO for the year, and in five months brought in $1875, leaving $13,000 to come in for each of the last six months of the year; no concerts were scheduled for September. Mr Jenkings says he did not expect any concerts at all in the winter, and so is $1875 ahead, and that he expects, from inquiries already received, that the total will be reached, or very nearly so. GREYHOUND RACING Athletics, soccer, and greyhound racing in the stadium are budgeted to bring to $12,000 for the year; in five months $3300 was received, $3OO ahead of what was expected in the first five months—and one soccer match has still to be held. As greyhound racing will begin in January on a fortnightly basis, Mr Jenkins is confident that the total will be reached by the end of the financial year. Souvenirs are selling well —turnover is about $4OO a week—but the creche, budgeted to bring in $lO,OOO for the year, might not open at all because of problems meeting regulations. This

| would increase the bud- ■ geted loss of $50,000 to I $60,000. Tours of the complex are I bringing in an average of ’s3so a week, which Mr Jenjkins feels will continue. He does not share the view that interest in tours must decline as time passes. i Squash is running well up Ito the budgeted $36,600 for ■the year, having returned an i average of nearly $BOO a 'week in the two months it has been using the facilities—much of that time with Jonly three or four courts in use. The full seven which will be used later. ???? In the two months, squash has returned $6129. The Ascot golf links, regarded as being part of the complex and budgeted with it, are expected to return $24,000 for the year. In five months, the links returned $6OOO, but Mr Jenkings is confident they will average $2500 a month for the rest of the year to reach the budget estimate. PARKING REVENUE Parking, expected to bring in $12,000 for the year, has so far brought in only $3OO. Later activities at the park, including the New Zealand games, are expected to bring this figure up to the estimate.

The restaurant had been expected to bring in $26,000 for the year, but this is in some doubt because of disagreements between the caterer and the council. Total income for the complex for the first five months of the year was $52,000, and if income were to continue at this rate, the return for the year would be $167,000. The budgeted return for the year is $347,000. Budgeted costs are $397,000, but in five months have been $206,000. If they continue at the same rate, the year’s costs will be $469,000. If both costs and income continue at the rate so far recorded costs of $469,000 will be set against income of $167,000—a loss of $302,000. To reach the budgeted loss of only $50,000 the complex must, therefore, make $367,000 in the last seven months of the financial year—ss2,000 a month. With $17,000 income in September, the total which must be taken in the rest of the year rises to $58,333 a month. Mr Jenkings said yesterday that with the best months of the year still ahead, returns of this order were attainable. If they were not attained, he said, he would not fee) constrained to apologise; the budget was based on unknown factors, and the complex was untried. It would be two years before a budget based firmly on experience could be drawn up. WHITE ELEPHANT He was sure that the complex would break even on its working costs within 10 years. Mr Jenkings, who keeps a model of a white elephant

in his office and says he looks at it frequently to remind himself of what the park is not going to become, says that he has always had confidence in the complex, and that nothing has occurred to shake it. “I’ve got great confidence in this place,’’ he says, “but I don’t think it’s been given a fair go yet. I wish people would give it a go. We have’nt even finished it yet.” The part of the year since the Commonwealth Games contained the season’s traditionally the bleakest for such complexes, Mr Jenkings says. Similar complexes expect to make one-third of their annual income in December and January. Mr Jenkings says that the omens for Queen Elizabeth II Park are good: The interest shown by promoters in the stadium has been a surprise, the pool has been widely used in the least favourable time of the year, and there is plenty of space for new and profitable developments, several of which are being considered. This month, the stadium is booked for hockey trials, school sports, a soccer match, and athletics, and indications are that in the next few months it will be very much busier. Several entertainment entrepreneurs are interested in the park, and four of them organise about three big shows each year, says Mr Jenkings. These shows, and there are many more in the offing, might bring the complex in more than $60,000 a year. Activities at the park will increase considerably in November. Bookings have been made for several athletics meetings, and one promotion will probably fill the park to capacity for the first time since the Commonwealth Games — a fireworks spectacular put on by the Jaycees. But the stadium’s biggest 'money-spinner is likelv to be the greyhoud racing, Mr Jenkings says. The meetings will probably begin with equalisator betting, and one meeting evey fortnight. Within a relatively short time, totalisator betting and weekly meettings throughout the year are likely. Mr Jenkings says that, judging by the experience of

Melbourne’s Olympic stadium and, its greyhound racing, the sport can be expected to bring the park “good, solid money all the time,” and before long return annual sums in six figures. The income the stadium, tours, and other recreational attractions will bring in, will be needed not only to meet the wages of the present 41 permanent staff members, and other runnings costs, but to subsidise the running of the pool, Mr Jenkings says. He does not foresee a time when the pool will break even, in spite of the encouraging early use and the expected sharp rise in patronage. “The important thing is that it be used — and it is being used. If you have a pool which is running at a loss and is not being used, then you are in trouble,” he says. OIL HEATING The costs of running the pool are very considerable, one of the main items being the oil heating, especially since the price of heating oil increased earlier this year. At least in the winter, it is likely that the people who pay to swim in the pool are not even paying for the oil used to heat the water, let alone the attendants, chemicals, lighting, filtration, cleaning, and general maintenance. The rates charged for the stadium vary considerably. At present, a school hiring the area for sports pays $4O a day. Most promoted shows in the stadium will be charged $lOOO a day, or 10 per cent of f.e gross, whichever is greater. Mr Jenkings says that he will be disappointed if the “take” to the park does not average more than $5OOO a show. “I am greatly optimistic about the stadium,” he’ says. “The/inquiries we have had are from genuine people, who are big in this business. If some of the names they are talking about turn up, it will be fabulous. I am very ex-ited about the whole thing. “I have a feeling of great confidence in this place, and for $4.5m it is the best value I have seen in my life,” Mr Jenkings says. At today’s rates of inflation, this sum is already cheap, he adds. Building the complex today would cost a great deal more.