The Pellucid Perspective - August 2011 - (Page 9)

Jim Koppenhaver comments, “Living in Chicago this year it seems we’re near (if not at) the epicenter of a number of extreme weather events, back-to-back-to-back (as they say on Sports Center). The Great Lakes and Ohio Valley have been subjected to the full spectrum of unfavorable golf conditions this summer... Facility Gross Revenue by Department Jun 2011 7% 6% 5% 4% 3% 2% 1% 0% –1% –2% –3% F&B Merch. Golf Fee Revenue Revenue Revenue ___________________________________________ 6% n Curr Month ___________________________________________ 6% n Curr YtD ___________________________________________ ___________________________________________ 3% 3% ___________________________________________ 3% 2% ___________________________________________ 1% ___________________________________________ ___________________________________________ ___________________________________________ ___________________________________________ –2% ___________________________________________ Source: PGA Performance Trak Total Revenue eral this summer. The national picture however is being propped up by favorability along the Southeastern seaboard, Florida and the Gulf as well as the Rockies and the Southwest coupled with stability in the key California Coastal region. While I love Chicago and its generally very hospitable summer golf weather, it’s a banner bad weather year here for residents, let alone those trying to make their living running golf facilities.” n p Looking at gross revenue by major departments, June was up 3% in Total Revenue with all major revenue centers contributing led by F&B gains of +6%. The YtD revenue edged up slightly to +1% also driven by strength in F&B (+6%) and offset slightly by the 2% decline in Golf Fee revenue.. All Facility Gross Revenue-Rounds-Rate Jun 2011 Curr Month Curr YtD Golf Fee Revenue-Rounds-Rate by Facility Type Jun 2011 YtD 25% ___________________________________________ n Fac Gross Rev n Rounds n Rate (Rev/Rd) 20% ___________________________________________ 15% ___________________________________________ 10% ___________________________________________ 5% 5% ___________________________________________ 2% 2% 1% 0% ___________________________________________ –1% –2% –1% –2% –5% ___________________________________________ –3% –4% –5% –6% ___________________________________________ –10% –1% –1% 7% 25% ___________________________________________ n Fac Gross Rev 20% ___________________________________________ 15% ___________________________________________ n Rate (Rev/Rd) 10% ___________________________________________ 4% 3% 5% ___________________________________________ 2% 1% 1% 0% ___________________________________________ –3% –5% ___________________________________________ Source: PGA Performance Trak All Fac. Types Private Daily Fee Mun/ Mil/Univ Resort n Rounds Source: PGA Performance Trak p Looking at facility gross revenue, rounds and rate as reported by PerformanceTrak, June showed a 3% gross revenue increase vs. year ago driven by a 2% increase in rounds and augmented by a 1% increase in rate per round played. For the Year-to-Date period, facility gross revenue inched up to +1% as the result of a 3% decrease in rounds neutralized by a 4% increase in rate. All things considered, we prefer to see a tradeoff in rounds for holding or higher rate as long as the net result is a positive change in revenue (i.e. our rate increase was more than what we gave up in rounds). This usually suggests that modest pricing power exists, discounting is abating or golfer play mix is shifting to higher rate round periods (i.e. weekend AMs vs. weekend PMs etc.) or some combination of the three. p Looking at Golf Fees Revenue performance by facility type and contributory factors (rounds vs. rate) for the Jun YtD period, the 2% drop in revenue was driven by a 6% decline in the Muni/ Mil/Univ segment. The 3% decline in rounds was driven by declines of 5% and 4% in Muni/Mil/Univ and Daily Fee respectively. The 1% increase in rate was driven by the Resort (+5%) and Daily Fee (+2%) segments. Looking at the diagnostic measures within each facility type, Private is basically flat across all measures. Daily Fee improved slightly to -2% in GF revenue driven by a 4% rounds decrease offset by a 2% increase in rate. Muni/Mil/Univ continues “the negative trifecta” but improved slightly to the current YtD level of - 6% in revenue driven primarily by the 5% decrease in rounds. Finally, Resort maintained an 7% gain fueled primarily by a 5% increase in rate. The Pellucid PersPecTive www.PellucidcorP.com 9 http://WWW.PELLUCIDCORP.COM

Table of Contents for the Digital Edition of The Pellucid Perspective - August 2011

The Pellucid Perspective - August 2011
Contents
Why cost cutting doesn’t yield long-term prosperity
Get Golf Ready showing some traction
Danger, Will Robinson!
Golf holding up but heartland hammered by weather
U.S. golf course development dead, or just sleeping?
Whither the weather
Miami/Ft Lauderdale, FL Core Business Statistical Area (CBSA)
Comings & goings
A few changes of note in August’s dog days

The Pellucid Perspective - August 2011