The Management Group

2020 Year-End Report

The Management Group is a separate corporation created to hold, manage, and leverage the conference assets for the benefit of ministry expansion in the FMCSC. The Management Group seeks to build the kingdom by creating a sustainable surplus of resources for the FMCSC. There are three main segments of the Managements Group’s activities – investment assets, property management, and administration.

In our investment activities, we purposefully began the year with an unusually large cash balance due to a combination of market uncertainty and early COVID 19 concerns. By March the equity markets had fallen sharply and we began to gradually reinvest that cash. Towards year-end, as the COVID timeline was more predictable, we had significant and timely cash inflow which we utilized to move further into the market. By the end of the year, we only held 3.2% of our balance in cash with 28.2% in Fixed Income and 68.4% in the Equity Market.

Our performance (time-weighted and net of fees) was just over 9.5%. This is summarized below.

 

 

We would only add that the broad Equity price surge in late 2020 carried into 2021 and the current account balance (as of March 11th) is $14,002,324.

As you can expect, COVID had and continues to have an impact on all properties. With gathering shut down to flatten the curve, a number of our tenants saw a dramatic decrease in income. Our property management team responded quickly allowing us to have individual responses based upon the need. While in totality our properties under-performed against budget, we out-performed in the percentage of collected revenue against the market. As the COVID outlook appears to have a more predictable trajectory, we will look to swing the pendulum back.

Early in the year, it became apparent that, as a result of Covid 19, our actual income would be significantly below our original budget and we ended 2020 below budgeted income by 17.6%. There were two main factors at play here. First, rental income was down significantly reflecting the fact that stay-at-home orders. Second, we had budgeted for several new churches coming on during the year and the pandemic deferred that plan.

To offset this shortfall, staff instituted a significant reduction in expenses across the board. Major cuts included Administrative expenses (-52%), Personnel expenses reduced by (-31%), Professional Services lowered by (-35%), and Property Ownership costs down by (-12.7%). Total expenses were reduced by (-15.9%). The bottom line is that because of years of faithful stewardship, we were able to continue to supply both our Operating Budget and Kingdom Ministry Group Budget with the necessary income to advance the kingdom in their given areas.