Global Spectrum admits to ’mis-steps’ in SOEC managemen

JOE FRIES  Wednesday, December 22, 2010 Penticton Herald:
 Global Spectrum has finally released fresh financials from the four city-owned properties it operates, and they show the facilities are gobbling up cash faster than expected. As of Nov. 1, the buildings had racked up a net operating loss of $1.35 million, compared to the budgeted shortfall of $1.18 million. It‘s likely Global Spectrum will exceed its targeted loss of $1.77 million for the year, and the company has already committed to make up the difference. "It‘s a real solid commitment by our company,” said local general manager Dean Clarke.  Global Spectrum “felt that when it came to some of the events that we had booked, we didn‘t protect our client as well as we could have. So there may have been some mis-steps,” he allowed.  Clarke expects his company will eat about $300,000 as a result of its pledge, $207,500 of which will be the forfeiture of its annual management fee. Global Spectrum operates the South Okanagan Events Centre, Penticton Trade and Convention Centre, Memorial Arena and the Okanagan Hockey School Training Centre, which are known collectively as the Events Centre Campus. According to statistics provided Tuesday, the campus saw 216 events through the end of October, ahead of the 196 events forecast, which included everything from hockey games to conferences. Attendance at the events was 238,254, well over the budgeted figure of 210,647.  Combined, those bookings generated total income of $553,636, well off the budgeted mark of $1.43 million. 

Clarke cited an aggressive booking policy for some of the unmet expectation. “I think initially in our aggressive year we were buying shows. Hopefully we‘re moving into the second phase where we‘re going to co-promote shows or we‘re going to find a partner,” he said, adding he expects to decrease the number of events next year to around 180. Although the public was initially promised monthly financial statements for the building, the last such update came in July. Clarke said staff turnover is partly to blame, and promised, “We‘re streamlining this process so that doesn‘t happen anymore." That last monthly statement pegged the net loss through the end of June at $785,000, which suggests that the campus lost just under $562,000 from July through October. Those months also saw some of the biggest events of the year at the SOEC, including the Rihanna concert and the NHL Young Stars tournament.
Coun. Andrew Jakubeit, the city‘s point man on the hockey showcase, defended it.  “You have to factor in the economic impact of the event, and with the Canucks and Young Stars it was just shy of $2 million,” Jakubeit argued. He also reiterated that the event brought high-level exposure to the city, and, “I think you have to weigh that in.” (more)