Halfway through its fiscal year, the college is on-track to record another eight-figure year-end surplus.
During its October 25th meeting, the school’s Board of Governors received the end-of-September “actual” financial numbers from Chief Financial Officer Marc Jones.
Like the provincial government, the college operates on a fiscal year of May 1 to April 30, so the end of September represents its halfway point.
As of that date, the budgetary bottom line features black ink in the amount of $13.227 million. That is over $5.6 million higher than the midyear surplus in September of 2021.
That trend, if its stays intact for the remainder of the fiscal year, means that the college should achieve the year-end surplus that had been projected by Jones when he tabled the original budget in March of last year: an operating profit in 2022-23 of at least $32 million.
If achieved, that would be the college’s fifth consecutive annual surplus in excess of $25 million.
Stagnant domestic enrolment, stable international enrolment, and the continued substantial enrolment growth of St. Clair’s “sister school” in the Greater Toronto Area (the three-campus Ace Acumen Academy) has kept tuition revenue at very healthy levels – although under target levels for the year because of the continued backlog in international visa processing.
In terms of financial review specifics, Jones reported as follows to the Board:
The net surplus at September 30, 2022 of $13,227,295 is an increase of $5,652,046 from the net surplus noted for the 2021 comparative period (September of last year) of $7,575,249.
REVENUE
The following highlights the major changes in revenue compared to the original budget projections (in March) and the 2021 comparative period:
• Ministry of Colleges and Universities (MCU) Operating Grants are trending consistent with the original budget projection at 53 percent (for the year-to-date), and have decreased over the 2021 comparative period by $147,023 or one percent.
• Contract Income is trending below the original budget projection at 45 percent and has decreased over the 2021 comparative period by $1,566,265 or 21 percent. The decrease is due to the Ontario government’s funding for an accelerated Personal Support Worker program that covers students’ tuition and other expenses beginning for the fall semester instead of the spring semester in the prior year.
Contract Income is established based on agreements with the ministry and other partners. The college anticipates being below its budget projections. However, any shortfalls in contract income will be mostly offset by a decrease in expenditures.
• Total Tuition revenue is trending below the original budget projection at 39 percent, and has increased over the 2021 comparative period by $5,974,502 or nine percent due to the following:
– Decrease in Domestic Tuition revenue of $733,554 over the comparative period due to lower enrolment for the Spring semester;
– Increase in International Tuition revenue of $838,279 over the comparative period due to unrealized tuition refunds from the Winter 2022 semester and a higher Winter semester revenue deferral being realized for the current year;
– Increase in private/public college partnership Tuition revenue of $5,289,016 over the comparative period due to higher enrolment at Ace Acumen for the Spring and Fall semesters.
• Total “Other” income is trending above the original budget projection at 65 percent and has increased over the 2021 comparative period by $7,594,841 or 29 percent due to the following:
– Increase in Fee-for-Service of $2,334,101 due to higher enrolment at Ace Acumen for the Spring and Fall semesters;
– Increase in Divisional Income of $2,601,176 due to higher international student insurance fees as a result of higher Ace Acumen enrolment;
– Increase in Interest Income of $1,398,443 due to significant increases in the Bank of Canada’s policy interest rate and interest realized from maturing GICs.
EXPENDITURES
The following highlights the major changes in expenditures compared to the original budget projections and the 2021 comparative period:
• Total Salaries and Benefits are trending consistent with the original budget projection at 49 percent, and have increased over the 2021 comparative period by $1,429,222 or three percent. The increase is primarily due to net new staffing, compensation adjustments, and additional resources to meet the college’s operational needs.
• Total Non-Salary expenditures are trending above the original budget projection at 44 percent and have increased over the 2021 comparative period by $5,737,204 or nine percent. The increase is due to the following:
– Increase in Advertising as a result of college recruitment and branding initiatives, and support of a new acute care hospital (donation);
– Increase in Contracted Educational Services as a result of higher enrolment from students attending the Toronto campuses, and flowing the applicable funds to Ace Acumen;
– Increase in Insurance due to new, higher international student insurance fees as a result of higher Ace Acumen enrolment, and due to the college’s corporate insurance premiums increasing because of the hardened insurance market;
– Decrease in Premise Rental due to the international student arrival protocol no longer being active (the college had been renting hotel space to house arriving students during their pandemic quarantines);
– Decrease in Stipends and Allowances and Other Expenditures due to timing of funds flowed to students registered in the accelerated Personal Support Worker program;
– Increase in Amortization due to the college’s significant investment in its capital infrastructure during the prior year.
Many expenditures are cyclical and follow the timing associated with the academic year.
Administration is managing Non-Salary expenditures through ongoing Senior Operating Group review to ensure the overall expenditures budget is met.
ANCILLARY (NON-ACADEMICALLY RELATED) OPERATIONS
The Ancillary Operations deficit of $194,428 is trending below the original budget projection of $1,241,671 and has improved by $962,417 over the 2021 comparative period. This is primarily due to improvements from the St. Clair College Centre for the Arts (Chrysler Theatre, convention and banquet bookings), Parking and Residence operations.
OTHER STORIES FROM THE BOARD OF GOVERNORS MEETING
• Apprentices voice their opinion of the college: https://news.stclair-src.org/need-know-news/fluctuating-apprenticeship-surveys-reviewed-board
• Recap of the past year’s marketing efforts: https://news.stclair-src.org/need-know-news/enrolment-and-revenue-depend-marketing-and-recruitment
• Contract/Corporate Training has rebounded: https://news.stclair-src.org/need-know-news/contract-training-rebounds-pandemic
• Running the college is risky business: https://news.stclair-src.org/need-know-news/board-reviews-its-risks
• College prepares for impact of new enrolment-related funding formula: https://news.stclair-src.org/need-know-news/college-prepares-change-funding-formula
