It is a pleasure to give my final report as Treasurer of the Museum of Fine Arts. When I began three years ago we were in the midst of dealing with the impact of the worst recession since the Great Depression. While there are still many uncertainties regarding the economy as a whole, the Museum has weathered the storm reasonably well. The endowment is almost back to its prerecession high and that’s after using approximately 5.5% per year of the endowment to support the operating budget of the Museum and School. The value of the endowment at June 30, 2013, was $554 million with a performance return of 11.2%. The performance return surpassed our long-term planning assumption of 8.5%.
We continue to offer an impressive array of diverse exhibitions and other educational programming that attracts a substantial number of visitors to the Museum. This year attendance reached 1,030,000 visitors to the Museum.
As I mentioned in last year’s report, the MFA has a long history of operating surpluses not achieved by many of our peers. This year I am pleased to report that we once again achieved an operating surplus. The Corporation overall has achieved better than budgeted performance with a surplus of approximately $1.242 million versus the budgeted surplus of approximately $600,000. Each of the business segments achieved a surplus as well, with the Museum reporting a surplus of $895,000, Retail a surplus of $89,000, and the School had surplus of $258,000.
Fiscal Year 2013 saw the Museum’s AA bond rating by Moody’s reaffirmed shortly after last year’s annual meeting. The capital markets continue to be challenging and the Museum completed an expansion of our credit support in the fall in order to diversify our risk in this regard.
We continue to monitor our financial performance against our long-term planning model in the context of our annual review of the operating budget. The Budget and Finance Committee recommended to the Board a budget for FY14 that again provides for an operating surplus, as well as resources to accomplish the educational and cultural mission of the Museum and School.
In order to further strengthen our overall financial position, the Museum launched a capital campaign in February after many months of planning appropriate to this type of an endeavor. When its goals are achieved, it will substantially enhance the Museum’s overall financial health, which is so important in these uncertain times. I am sure we will all do what we can to see its successful completion.
In closing, I would like to thank our exceptional Deputy Director and CFO, Mark Kerwin and his dedicated Finance team, in particular, Patricia Lyden, John Toulmin, Leah Sullivan, and Ruth Pendleton. It has been a pleasure working with them over the years. I would also like to thank the members of the Budget and Finance Committee for all they did to support me, and this great Museum, during my tenure as Treasurer.
Treasurer and Chairman of the Budget and Finance Committee