From the President - Oct. 2010
As always, I appreciate your interest in the St. Louis Symphony. Now, with the close of the fiscal year on August 31, I am pleased to write to you with a report on FY2010 financial results.
In 2008, we launched our Building Our Business initiatives. The fundamental focus of the plan has been to build all operating revenues with an emphasis on audience growth, and maintain a disciplined approach to expenses. These results follow two years of implementation of our plan. I am pleased to report that over this time, we have made important progress in the key areas of major audience development and meaningful reduction of long-standing operating deficits.
Earned Revenues for FY2010 totaled $8.1m, an increase of more than $1.03m or 14.5% over FY2009. Ticket sales, which account for 80% of earned revenue, reached $6.47m, up 16% or $890,000 over FY2009. This represents 197,105 seats sold, an increase of 18,268 seats or 10.2% over FY2009. Per concert attendance averaged 1,792, up 9.2% over the previous year. These results represent the highest ticket revenue for all concerts in a decade, and the largest total attendance since 2002.
Total ticket revenues and paid attendance growth over a two-year period (since the launch of major audience development initiatives) for all concerts at Powell Hall for the 2009-10 Season as compared with the 2007-08 Season are up 33.7% or $1.63m, with total seats sold up 18.8% and per-concert average attendance up 17.7%, reversing downward sales and attendance trends that characterized preceding years.
Contributed revenues totaled $8.52m, unchanged from FY2009. Annual Campaign declines were offset by a highly successful gala—the Symphony’s first in a decade—and strength in special underwriting support for operations. Sponsorship revenues were up 3.4% over FY2009. Total contributed revenues of $8.52m in FY2010 remain up $762,000 or 9.8% over FY2008 contributed revenues totaling $7.76m.
The endowment at the close of the fiscal year stood at $116.6m, down from its high of $142m in 2007, but rebounded from its March 2009 low of $93m. The “draw” for the current fiscal year, $6.24m, was down from $6.44m in FY2009, due to the overall decline in market value since the start of the recession. The annual draw on endowment is calculated as 5% on a three-year rolling average.
Expenses totaled $26m, 1.8% over FY2009. A disciplined and sensible approach to expenditures continues to be a parallel strategy to revenue growth initiatives being implemented in Building Our Business.
Budget Results: The “Bottom Line”
The St. Louis Symphony beat its “bottom line” budget projection with its structural operating deficit declining to $2.62m for FY2010, a decline of $$337,000 or 11.4% from FY2009, and the smallest operating deficit since 2005. This decrease was achieved despite a drop in endowment revenue of $200,000 from the previous year, and was driven by growth in ticket revenues. Since 2007, the operating deficit has decreased $773,000 or 23% from $3.4m to $2.62m in FY2010, and declined as a percentage of budget from 14% to 10%. There continues to be no accumulated debt with deficits currently funded into 2014 by special revenues raised for this purpose. Structural deficits are projected to fully close by 2019.
Generally, we took another important step forward in FY2010 in our strategic and financial plan with the audience growth and reduction in the structural gap. We’re moving in the right direction, and are generally “on plan.” Major double-digit gains in ticket sales and paid attendance, and continued attention to expenditure of resources offset endowment declines and annual campaign challenges. And in a national environment where audiences are generally declining, the St. Louis Symphony showed significant progress. Going forward, we will continue to focus relentlessly on growing audience, building our fundraising base, with a particular emphasis on strengthening our annual contributed revenue capability, and reducing the structural deficit, all within the framework of presenting the highest quality music-making possible.
Thank you for following our progress. I look forward to keeping you fully appraised as the 2010-11 Season, our 131st, unfolds here at Powell Hall.