April continued an unparalleled string of favorable golf weather which invokes the channeling of Austin Powers headlined above. April marked the 4th successive month in 2012 of widespread, incredibly temperate weather as Golf Playable Hours (GPH) registered +27% vs. last April at the national level! That brings the national Year-to-Date (YtD) GPH results to +38% vs. the same period year ago. The regional breadth for the YtD period was a stunningly favorable at 41:1 with 41 regions having favorable weather against 1 region (HI) with unfavorable weather (the remaining 3 were in the neutral zone of +/- 2%). As outlined and quantified in Pellucid's monthly report available to Publications Members (go to www.pellucidcorp.com
for information or to subscribe), weekday weather was slightly more favorable than weekends and Pellucid is projecting that YtD weather favorability gains will hold or slightly increase throughout the balance of the year.
Looking back on March rounds demand, as reported by Golf Datatech/NGF to calculate the facility Utilization Rate, it comes out mathematically as another significant deficit in Utilization but given that many northern geographies had exponential gains in Capacity Rounds (CR), we know it's unlikely that a doubling of the CR is going to produce a doubling of rounds. The YtD Utilization registered at 43% (comprised of a 22% increase in Played Rounds against a 47% increase in Capacity Rounds) which is 9 points lower than the 2011 year-end value. In other words, rounds demand responded to the widespread incredibly favorable weather but not proportionately.
Jim Koppenhaver comments, "Much like we rationalize winters in Chicago, a snow-free month does not a winter make but it does mean 30 fewer days of tolerating it that year. While the incredible April doesn't necessarily guarantee our season, it's another month of unplanned "money in the bank" that the average operator is thankful for from a cashflow standpoint. The slight risk however is that some number of operators who were planning more aggressive (and hopefully intelligent) marketing efforts for this season may be tempted to take their foot off that gas pedal slightly. That would be a big mistake in my opinion. On the contrary, the additional early-season cashflow is somewhat of a safety net and permission to get their game on and start engaging the consumer the way they should have been in the leaner years but were unable to do based on the cash crunch. On the equipment manufacturers side, the April weather results will be a test of Casey Alexander's theory that having good April weather induces early equipment purchase by consumers and initiates a virtuous season cycle of repeat purchase translating to higher unit sales and also higher profits (due to the fact that early season sales are heavily biased to full margin vs. discounting as well). Last year was the inverse as poor April weather pre-empted the virtuous cycle; we'll see whether the consumers are buying into that theory."
On the Golf Fee Revenue (GFR) side via the March PGA PerformanceTrak numbers, they're reporting a +34% gain for the month (similar to the 37% increase in rounds meaning rate held steady vs. YA). For the YtD period, Golf Fee revenue registered +24% suggesting rate lags slightly for the cumulative period as well (by comparing the 28% rounds increase producing a rate decline of 4% vs. YA). Given the much stronger GPH results vs. GFR (+47% GPH vs. +24% GFR), it suggests that Revenue per Available Round (RevpAR, or the revenue efficiency of our "factories") is lagging last year and all of our GFR favorability can be explained by weather.
A broader and more detailed scorecard of the monthly key industry metrics can be found in Pellucid's free digital magazine, The Pellucid Perspective. To register to get the current and future editions, go to http://www.pellucidcorp.com/news/elist
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As mentioned multiple times above, industry stakeholders wanting the detailed metrics and monthly updates on weather impact at the national, regional and market level as well as utilization and the full year forecast numbers can subscribe to the Pellucid Publications Membership (Outside the Ropes monthly newsletter, 2011 State of the Industry, Monthly Weather Impact and Top 25 Golf Markets reports, $495 annually). For individual facility owner/operators who need facility-level history, current year results by month and day-of-week and full year forecast data, Pellucid/Edgehill's self-serve, web-delivered, real-time weather impact service called Cognilogic is your answer. It's available for as little as $120 for a year-end report or $240 for the year-end report and 12 month tracking. For more information, contact Stuart Lindsay of Edgehill Golf Advisors (firstname.lastname@example.org
). You can now order either of the above information services via Pellucid's online store at http://www.pellucidcorp.com/purchase-reports/online-store