I am pleased to report to you, as Treasurer, that the Museum achieved another year of better than break even operating performance for the year ended June 30, 2016, and made significant strides in our goals of reducing our debt, and successfully completing our capital campaign. We also finalized the merger of the SMFA into Tufts University, with the common goal of the SMFA’s long-term advancement and growth.

In terms of operating performance, last year we attracted 1,182,000 visitors to the Museum, which, while off of prior year’s results, was 3 percent better than budget. The MFA achieved a surplus of approximately $125,000, which fell short of our budgeted operating surplus of $700,000, but does continue a long record of positive surplus.

The value of our endowment was $547 million at June 30, and the endowment recorded a performance decline of 0.7 percent for the fiscal year. As I mentioned last year, the equity markets have been challenging and may continue to be so. We have a well-diversified portfolio and benefit from an active and engaged Investment Committee seeking to maximize return and preserve the long-term value of the endowment. I would like to add that the endowment performance this year ranks in the top decile of the Cambridge Associates’ data for all the endowments they assist.

I am very happy to report that we have just completed our current $200 million capital campaign. Its success is the result of the untiring commitment of the MFA’s supporters and we thank you for all you did, and do, to advance this institution.

This fundraising success permitted us to reduce our long-term debt by $10 million during the fiscal year and pay down an additional $5 million of principal last month. We have met the terms of a challenge grant related to the campaign, and as a result expect to reduce debt by another $15 million in the next 30 days or so. Summing these payments together with prior years’ debt repayments, in a few short years we will have reduced our long-term debt by $74 million, leaving us with approximately $115 million in debt outstanding.

As a result of this debt repayment and the favorable operating results, Standard & Poor’s has recently reaffirmed the Museum’s favorable AA bond rating with a stable outlook.

The Board of Trustees, upon the recommendation of the Budget and Finance Committee, adopted a budget for FY17 with a budget surplus of $50,000 for the institution.

Finally, I want to say that we all owe real thanks to our very capable Leadership Team. During a year of organizational and institutional change, management balanced a variety of objectives and delivered impressive results.

Respectfully submitted,

Kevin T. Callaghan
Treasurer and Chairman of the Budget and Finance Committee

Financial Reports

Notes to the financial statements are available upon request to the Museum’s Financial Department.