© File photo
The Pepsi Centre's financial information was posted on its website, PepsiCentre.ca on Tuesday, Aug. 21, 2013.
CORNER BROOK — Allan Kendall says the Pepsi Centre needs innovative and creative ideas to be a sustainable operation.
As user groups rally against a prospective rental rate hike, the new chair of Western Sports and Entertainment wants to make sure everyone has the correct financial information regarding the centre and its operation in Corner Brook.
The centre’s financial information was posted on PepsiCentre.ca Tuesday to help clarify some things, Kendall said, and provide a perspective on what has happened over the past five years.
“There is talk we have to be creative and innovative, and I have no issue with that,” he said. “If people have ideas, we are all ears. To me, it has to be a partnership with regards to all the users and the operator to make sure we can make it viable.”
He said users must also be innovative and creative in generating the money required of them to use the Pepsi Centre — whether that is additional fundraising or other means. While there have been increases to ice rentals in the past three years, he said the three years prior there was no increase.
The chair said it is obvious the City of Corner Brook is doing its part — providing an $850,000 municipal grant, which accounted for 41 per cent of the annual revenue in 2012-2013. That has increased from $681,004 in 2008-2009 — with the largest jump of $150,00 in 2011-2012.
It cost $2.25 million last year to run the facility, which generated just under $468,000 through meetings, conferences and special events. The costs for those items is around $291,000 for a $177,000 profit.
In 2011-2012, the meetings, conferences and special events came out $280,000 in the black as the facility generated more than $556,000 from meeting, conferences and special events.
The decline in this revenue source during the last fiscal year attributed to about 66 per cent of the $155,804 shortfall last year.
Kendall said the Pepsi Centre is competing with hoteliers and other facilities in the area to host such events. Those facilities can be utilized at a cheaper rate in most cases.
“With the economic situation as it is over the last number of years, I think organizations are less likely to do conferences and meetings on a large scale,” he said. “That’s where employers are cutting back, so we are going to find that as well.”
In 2011-2012, senior hockey, holding seats and skyboxes brought more than $135,000 into the Pepsi Centre. This past year, it was just $14,350. After failed negotiations, the Corner Brook Royals moved out of the Pepsi Centre and went to Deer Lake. That loss of about $121,000 accounts for about 78 per cent of the same overall deficit.
Kendall recognizes the financial impact of losing the senior hockey club. As a new board member, he said he was not aware of what took place in negotiations with the team. However, he said he is open to discussions involving a possible return or the arrival of a new major tenant.
Kendall said there has been interest expressed locally about the possibility of adding a new senior hockey team in Corner Brook, but is unsure of just how serious that effort is, or whether it could happen in time for the upcoming season.
“We would definitely have our ears open if somebody wants to put a team in or the Royals want to come back,” he said. “There’s no question about it ... we would like to have as many users as we possibly can.”
Income from advertising, at $54,058, was also the lowest it has been in the past five years. However, that accounts for just three per cent of the overall revenue.
The largest expense at the Pepsi Centre is salary and wages at $893,033, accounting for about 40 per cent of the budget. Salary and wages increased about $204,000 — 30 per cent — since 2007-2008. The amount rose about $90,000 in 2008-2009 and another about $80,000 in 2010-2011. The chair was not able to say whether more people were hired or wages increased during those years. Wages have stayed consistently about 40 per cent of all expenses.
Oil and propane accounts for nearly $300,000 and the electricity bill is about the same amount. Kendall said these expenses are mandatory, and areas which continually see uncontrollable rises.
Revenue 2012-2013 2007-2008
Municipal grant $850,000 $691,263
Meeting, conferences and special events $467,900 $215,691
Ice rental and general skating $454,048 $399,536
leases and other $149,500 $217,484
Advertising $54,058 $57,968
Naming royalty $50,000 $50,000
Annex/studio rental $50,766 $47,244
Senior hockey, holding seats, skyboxes $14,350 $145,667
Expenses 2012-2013 2007-2008
Salary and wages $893,033 $688,181
Oil and propane $298,495 $179,164
Electricity $296,954 $273,785
Meeting, conference and special events $291,452 $55,296
Facility management $135,917 $185,848
Lease expense $127,211 $122,969
Office admin and misc costs $114,209 $148,145
Insurance $46,681 $65,063
Telephone and communication $17,944 $23,602
Senior hockey, holding seats, skyboxes $10,303 $28,900
Professional fees and advertising, marketing$14,227 $4,351
Surplus/Deficit ($155,804) $49,548