June 13, 2017 Board of Directors Meeting Fiscal Year 2018 Budget - - PowerPoint PPT Presentation

June 13, 2017 Board of Directors Meeting Fiscal Year 2018 Budget and Supporting Materials

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• Executive Summary
• FY 2017 Operations & Financial Review
• FY 2018 Operational Plan Overview
• FY 2018 Financial Budget
• Required Resources

Overview

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• Targeted growth from 94K to 106K children.
• Focus on 4 current RMD Target Markets – Chicago,

Louisville, Jacksonville and SW Florida.

• 3 New Target markets for late-spring – LA, DC, ATL.

Funding to be raised in advance of RMD hires.

• Due to financial constraints, Food Logistics services

are not in the budget, but are still a big focus.

• Cash flow critical first 5 months of the fiscal year

Executive Summary for FY18 Budget

Fiscal Year 2017 Operational & Financial Plan Highlights

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Fiscal 2017 Program Dept. Highlights

Overall Goal: Headcount Growth of 16,500 to 104,500 children served Develop infrastructure to support growth in the areas of: ü Staff including “Boots on the Ground” ü Program Support Strategy v Pricing Structure v Enhanced Volunteer Support ü Food Logistics ü Chapter Structure Implementation

Sysco, 25,370 , 27% Walmar t/Sam's Club, 21,812 , 23% Meijer, 11,649 , 12% Optimu m Foods, 3,855 , 4% Publix, 2,316 , 3% All

• thers,

27,596 , 29%

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FY17 in Review: Staff Additions = “Boots on the Ground”

2017 Approved Plan

• Establish boots on the ground to grow regional base in the following areas:

ü Southwest Florida (PT to FT) – 7/1/16 target, implemented 11/1, once Jacksonville RMD was hired and trained ü Jacksonville Florida – 8/1/16 target, hired 9/21/16 ü Chicago – 8/1/16 target, hired 9/11/16 ü Louisville – 1/1/17 target, implemented 1/1/17

• Selection criteria included strong local advisory board in place (except Chicago where overseeing NUDM funding was

a key requirement)

• Hire in advance of positions being able to support their own costs. Expected year 2 to be self-funding.
• Expected cost was $66K ($56K salary + $5K travel + $5K misc.)

2017 Results/Findings

• Regional Managing Directors in FL markets spend more time

than anticipated on local advisory board development and maintaining existing programs vs. fundraising and program growth

• Actual RMD cost higher than expected. FY 2018 budget

$84K average or $18K higher than FY 2017 expected

• Positions require financial support for marketing and PR,

geographic-specific website, etc. in addition to salary/benefits/travel

• Each market has different attributes that impacted growth

Region Begin End* Change % change Plan Southwest Florida 2,752 3,295 543 20% 4,615 Jacksonville Florida 9,772 10,700 928 9% 11,731 Chicago 4,987 5,564 577 12% 7,236 Louisville 7,457 7,303 154

• 2%

9,250

* Projected

Headcount Growth FY 2017

FY17 in Review: Program Support—Pricing Strategy

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2017 Approved Plan Major initiative: New Pricing Rollout 2017 Findings/Results

• $10 per child nonfood program support to take effect in the 17-18 school year was announced in

October 2017

• Backlash from existing “legacy” programs was extremely negative
• Following Board of Directors input, a Pricing Task force convened in December 2017
• A revised price structure for legacy programs was approved and implemented 2/1/17
• Impact is effectively $2/child vs. $10/child; however, risk of losing children served was lessened

FY17 in Review: Program Support—Volunteer Resources

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2017 Approved Plan Major initiatives: Enhanced Volunteer Support 2017 Findings/Results

• PC newsletter was launched in May to coincide with National Volunteer Week
• Significant enhancements to the PC Toolkit for volunteer Program Coordinators (PCs)
• Comprehensive updated Operations Manual to be released by June 30, 2017
• Possible National PC Conference was delayed to 2018 to focus on reaching PCs through

newsletter and PC Toolkit and to ensure adequate sponsorship support

FY17 in Review: Food Logistics

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2017 Approved Plan

• Create a National agreement with incumbent Sysco or other appropriate food vendor
• Pilot a prepackaged solution with Champion Foodservice
• Create an advisory committee to weigh in on possible solutions

2017 Findings/Results

• A National agreement with Sysco would have added 10% to food cost
• Prepackaged solution with Champion was piloted in Florida and Louisville through Sysco

ü Very successful in Florida ü Mixed results in Louisville ü Sysco’s lack of willingness to stock both prepackaged solution and “line item” menu was a significant obstacle to further roll-out

• Attempts to address food logistics with probono consultants were not successful
• ERA hired to support food logistics reengineering in April. Detail analyses completed in May.

Initial recommendations expected by the end of June

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FY17 In Review: Chapter Structure Implementation

2017 Approved Plan

• Develop a model to replicate in new markets
• Standardize local advisory boards

2017 Findings/Results

• Initiative was assumed by Director, Strategy and New Initiatives in connection with new market

roll-outs

• Templates developed included:

ü Operating Practices and Principles ü Advisory Board Member Job Description ü Advisory Board Member application

• Regional Managing Directors are using templates as guidelines in working with established local

advisory boards in moving to best practices, modifying as appropriate for local market needs. Some cultural resistance to overcome (i.e. no prior “dues” or “give or gets”)

Fund Development – Davidoff Consulting Project

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Develop corporate partnership program to develop a pipeline of national corporate partnership

• pportunities.
• What Was Successful
• Defined our program, what we offer and how to activate partnership
• New sponsorship program to leverage marketing dollar
• Better understanding of who we are, how others see us, and how to leverage that
• 41 new corporate donors as of 3/31/17
• 4 new cause marketing partners, 3 on partnership agreement phase, 4 developing
• What Was Not Successful/Lessons learned
• Cold outreach gets lost in the “noise.” Decision makers don’t respond without a known

contact sending the correspondence

• Large corporations see us a small fish in the pond – more influencers we have, the better
• Corporations default to school investor support – working on how to change that
• Cause marketing has much slower lead time than the standard corporate relationship

FY 2017 Budget to Projected - Statement of Operations

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Budget Projected Budget Projected Budget Projected Variance Revenues Unrestricted Donations $2,356,654 $2,275,956 $2,356,654 $2,275,956 ($80,698) -3% Program Revenue $8,029,936 $7,190,895 $8,029,936 $7,190,895 ($839,041) -10% Fundraising Events (Net) - Unrestricted $206,500 $198,433 $206,500 $198,433 ($8,067) Restricted FY17 Unrestricted FY17 Total FY 2017 Other Income/Gift $12,836 $12,836 $12,836 Investment Income $22,800 $30,330 $22,800 $30,330 $7,530 Total Revenue $8,029,936 $7,190,895 $2,585,954 $2,517,555 $10,615,890 $9,708,450 ($907,440) Expenses Food & Backpack $8,157,936 $7,018,961 $66,850 $55,336 $8,224,786 $7,074,297 $1,150,489 14% Staff $1,810,980 $2,007,957 $1,810,980 $2,007,957 ($196,977) -11% Contract Services $207,195 $146,454 $207,195 $146,454 $60,741 29% Administrative $524 $351,256 $329,699 $351,256 $330,223 $21,033 Depreciation Expense $12,000 $15,478 $12,000 $15,478 ($3,478) Marketing $4,500 $74,650 $26,686 $74,650 $31,186 $43,464 58% Travel $128,860 $128,502 $128,860 $128,502 $358 Other $1,426 $0 $1,426 ($1,426) Total Expenses $8,157,936 $7,023,985 $2,651,791 $2,711,538 $10,809,727 $9,735,523 $1,074,204 Increase (decrease) in Net Assets ($128,000) $166,910 ($65,837) ($193,983) ($193,837) ($27,073) $166,764 Direct Program Expense %, prior to Indirect Expense Allocation 76% 73% Total Non-Food Revenue is below budget, mainly due to a shortfall in program driven revenue as there was a change in the program fee from $10 to 2%. Food revenue is lower than budget, because we were feeding less children in the program during the year compared to budget. Full year we are approx. 10K children behind Food expense is lower than budget, because we were feeding less children in the program during the year compared to budget. Full year we are approx. 10K children behind Staff expense is projected over budget, in part do to the hiring of the Director of Strategy, which was not budgeted. Also the Communications Manager went FT from PT Staff expense was also higher as 1 new FTE position was originally in Contract Services. (Volunteer Engagement Coordinator) Contract Services is lower as food logistics services were lower than budget and due to a staff position being moved to salaried staff vs contract, per above. Marketing expense is ahead of budget as we did not spend as much as planned. Savings were used to help offset other costs.

FY 2016 Actual vs FY 2017 Projected Balance Sheet

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Assets

Cash ST Investments Acct Rec Pledges Rec Other Current Assets Fixed Assets Acc Depr Total

Total Assets Liabilities and Net Assets Liabilities

Accounts Payable Accrued Liabilities

Total Liabilities

Net Assets - Temp Restricted Net Assets - Unrestricted Total Net Assets

Total Liabilities and Net Assets

Cash has increased mainly due to inc Investments decreased at 6/30/17 d Unrestricted Pledges Receivable decr Fixed Assets increased due to the pu Temp Restricted Net Assets have dec

Restricted Unrestricted Total

4,170,684 $ 360,391 $ 4,531,075 $ 3,090,542 269,761 3,360,303 4,920

• 4,920

229,948 338,111 568,059 34,543 16,815 51,358 96,204 96,204 (83,333) (83,333) 12,871 12,871 7,530,637 $ 997,949 $ 8,528,586 $ 116,001 $ 61,828 $ 177,829 $ 460 44,227 44,687 116,461 106,055 222,516 1,122,942 $ 338,529 $ 1,461,471 $ 6,291,234 553,366 6,844,600 7,414,176 891,895 8,306,071 7,530,637 $ 997,950 $ 8,528,587 $ increased growth in children feed and NUDM Funds tr 7 due to $234K of NUDM Funds transferred to cover ch decreased since 6/30/16, as we collected $290K from Me e purchase of laptops for new staff hires. decreased at 6/30/17 as NUDM and other food related 6/30/2016 - Actual ds transfe er childre m Meijer lated Fun

Restricted Unrestricted Total

4,647,620 $ 516,131 $ 5,163,751 $ 14% 2,962,542 137,097 3,099,639

• 8%

2,959 1,302 4,261 284,206 100,509 384,715

• 32%

4,782 18,688 23,470 119,038 119,038 24% (98,870) (98,870) 20,168 20,168 7,902,109 $ 793,895 $ 8,696,004 $ 320,563 $ 25,221 $ 345,784 $ 460 70,752 71,212 321,023 95,973 416,996 506,516 $ 117,754 $ 624,270 $

• 57%

7,074,570 580,168 7,654,738 7,581,086 697,922 8,279,008 7,902,109 $ 793,895 $ 8,696,004 $ ansferred from Investments ildren feed in FY17. Meijer in Sept 2017 Funds have been released during the year to feed kids. 6/30/2017 - Projected

FY 2017 Unrest Rev Budget vs Forecast

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Category Not Identified Identified Total Not Identified Identified Total Not Identified Identified Total

Athletes 10,000 58,520 68,520 46,406 41,120 87,526 36,406 (17,400) 19,006 Corporations 158,840 351,920 510,760 280,862 337,814 618,676 122,022 (14,106) 107,916 Events, Net YTD 18,000 78,000 96,000 14,383 95,542 109,925 (3,617) 17,542 13,925 Foundations 79,000 343,900 422,900 62,496 594,625 657,122 (16,504) 250,725 234,222 Government 10,710 10,710 23,679 23,679 12,969 12,969 Individuals 121,800 167,250 289,050 158,187 205,075 363,262 36,387 37,825 74,212 Other 2,250 2,250 10,733 10,733 8,483 8,483

Total 389,890 $ 1,010,300 $ 1,400,190 $ 573,068 $ 1,297,855 $ 1,870,923 $ 183,178 $ 287,555 $ 470,733 $ Category Not Identified Identified Total Not Identified Identified Total Not Identified Identified Total

Athletes 16,000 79,120 95,120 51,500 43,620 95,120 5,094 2,500 7,594 Corporations 454,250 478,220 932,470 430,665 422,602 853,267 149,803 84,788 234,591 Events, Net 21,500 185,000 206,500 23,433 175,000 198,433 9,050 79,458 88,508 Foundations 104,500 621,800 726,300 62,496 604,125 666,621 (0) 9,500 9,499 Government 21,420 21,420 64,123 64,123 40,444 40,444 Individuals 143,500 245,000 388,500 218,087 267,157 485,244 59,900 62,082 121,982 Other 3,000 3,000 10,733 10,733 Total

742,750 $ 1,630,560 $ 2,373,310 $ 796,914 $ 1,576,627 $ 2,373,541 $ 223,846 $ 278,772 $ 502,618 $ FY17 Forecast To Secure Variance, Thru March Budget to Actuals FY17 Forecasted Total Revenue FY17 Nonfood Budget Thru March Nonfood Actuals Thru March Nonfood Budget

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FY17 In Review: Children Served

Budget Projected Variance 39 National Managed Relations (1) 4,000 1,721 (2,279) NUDM 2,200 2,200

• Dale Jr.

1,422 1,422

• New Regional

Directors (2) 2,180 2,209 29 Grass Roots:

• New Programs

1,921 Legacy 5,552 Total Grassroots 13,400 7,473 (5,927) Less Estimated Attrition (3) (6,700) (8,565) (1,865) Grassroots, net of attrition 6,700 (1,092) (7,792) FY Ending Balance 104,502 94,499 (10,003) (1) Includes appx. 4,000 children from Ohio Dept. Of Health, an increase of appx. 3,000 (2) Includes all children in programs assinged to RMD, even if outside target market. i.e. RMD for Jacksonville also has responsibility for program oversight for Alabama and select areas in FL (3) Actual attrition for FY17 will be determined once 6/30/17 childcount numbers are available 88,039 88,000 Beginning Headcount Actual

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FY17 In Review: Children Served

Primary Reasons Growth Objectives Were Not Achieved Hiring program team staff took longer than anticipated

• New Regional Managing Directors (RMDs) in place for 9 months or less
• New Program Managers (PMs) in place for 8 months or less

New pricing roll-out was a significant distraction in moving forward Higher attrition than anticipated in the FY17 Plan

• Pricing structure changes
• Expiring commitments for previous growth spurred by People Magazine
• Historical lack of proactive outreach to support program volunteers due to PM

coverage limitations (3.1 FTEs for 88,000 children)

• Some programs are serving fewer children as the need has decreased at

individual schoolsàimproving economy?

Fiscal Year 2018 Operational Plan Highlights

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FY18 Program Priorities

Overall: Breaking the Code to Sustainable Growth to serve 106,400 by 6/30/18

Maximize assets already in place: Regional Managing Directors

• Fundraising plans are being developed by each RMD for their respective markets
• RMDs to identify key memberships that will enhance their networking for purposes of

fundraising

• Further collaboration with the National Fund Development Department to enhance local

fundraising skills and opportunities Identify opportunities for collaboration and partnerships to significantly increase growth:

• Develop a comprehensive list of prospective collaborators, preferably national in scope (I.e.

Share Our Strength/No Kid Hungry, Feeding America, United Ways, Boys & Girls Clubs, large religious groups, police departments.)

• Conduct research to identify feasibility/pros and cons of collaboration
• Create partnerships aimed at significantly increasing numbers of children served as well as

funding opportunities.

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FY18 Program Priorities

Overall: Breaking the Code to Sustainable Growth

Establish Food Logistics Solutions as a Competitive Advantage over other weekend food programs

• 50% of food purchases are at retail prices
• 60% of food purchases require volunteers to pick up food (vs. delivery to packing site)
• Food purchases from 220 sources monthly do not leverage total food spend

A cost-effective and efficient food logistics solutions:

• is key to minimizing attrition for those who believe they can run their programs more cost-

effectively on their own

• is necessary to accelerate future growth in children served

Roles and Responsibilities of Managing Directors vs. Program Managers

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Regional)Managing)Director Program)Manager Summary

• Implement(Blessings(in(a(Backpack(strategic(

plan(in(assigned(geographic(territory(with(

• versight(for(all(local(fundraising,(program(
• perations(and(execution.(("Boots(on(the(

Ground"/face(of(BIB(in(the(local(community.

• Act(as(the(liaison(between(resources(of(the(

National(office(and(local(volunteer(program( coordinators.((PCs). FY18) Fundraising) Goal $237,000 $0 Fundraising

• Work(with(the(local(advisory(board(to(develop(

needed(resources.

• Build(partnerships,(establishing(relationships(

with(the(funders,(political(and(community( *((Corporate(asks *((Grant(writing Strategic

• Complete(the(strategic(business(planning(

process(for(program(expansion.

• Seek(and(build(board(involvement(with(

strategic(direction. Operational)

• Support(startNup(of(new(programs:
• Support(startNup(of(new(programs:
• Menus
• Menus
• Food(logistics
• Food(logistics
• How(to(run(a(program
• How(to(run(a(program
• Working(with(volunteers
• Working(with(volunteers
• Ongoing(support(of(programs
• Ongoing(support(of(programs
• Food%logistics%solutions,%as%needed
• Food%logistics%solutions,%as%needed
• Provide(donor(and(financial(reports
• Provide(donor(and(financial(reports
• Field(ongoing(questions
• Field(ongoing(questions

*((Chapter(board(liason(&(advisor *((Local(board(&(school(event(support *(((Represent(the(national(office(at(local( events(when(feasible.(i.e.(local(program( fundraisers,(check(presentations,(etc.

• Act(as(a(spokesperson(at(external(programs(

and(events(for(constituents(and(the(general( public,(when(feasbile *((Volunteer(coordination *((Volunteer(coordination Coverage Serve(50N200(schools,(<10k(children Serve(200N300(schools,(20N30K(children Specified(region MultiNstate(geographical(footprint

FY17 Year in Review: Program Team Footprint

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FY17 Year in Review: Regional Managing Director Model—Current State

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Key Responsibilities:

• Interface with local Advisory Boardàlimited structure or succession planning;

no established give/gets; work of committees loosely defined (if at all)

• Program Operationsàoversee an average of 6,400 children, 17-61 programs,

with an average of 140 children per program. (RMDs with larger counts also have some Program Management responsibilities.)

• Fundraising in the local community to cover operating expenses and feed

additional children Average cost of Regional Managing Director direct expenses = $82,000 Includes Salary/benefits, Marketing, Phone, Supplies, Travel Breakeven @ $10/child = 8,200 childrenàhigher than current assignment Unrestricted $s expected to be raised to help cover costs. Realities:

• Targeted Salary for this position is extremely low given the skillset required
• 8,200 children is higher than current assignments-->MDs are at capacity
• On average, 77 % of children covered by MDs are legacy, not $10/child (varies

greatly by market

Regional Managing Director Model—Future State

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Key Responsibilities:

• Interface with local Advisory Boardàboards created with guidance from

national; best practices; fundraising expectations defined upfront

• Program Operationsàoversee an average of 10,000 children, max. of 50

programs with a minimum average of 200 children per program

• Fundraising in the local community

Average cost of Regional Managing Director direct expenses = $100,000 Increase from Current State for more competitive pay Breakeven @ $10/child = 10,000 children Unrestricted $s expected to be raised to help cover indirect costs and legacy programs Requirements:

• Need to identify partnerships that will DRAMATICALLY increase the number of

children served per programàcan’t rely on grassroots growth with 50 children/school

• Need to increase the fundraising capabilities of MDsàtraining,

networking/memberships

FY18 Program Priorities: New Regional Managing Directors in New Geographic Target Markets

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Los Angeles and Washington, D.C. Revenue Goals before hiring a local RMD

• Raise $135K (LA) and $105K (DC) through Advisory Boards, Sponsorship, and

Personal Donations Atlanta Revenue Goals before hiring a local RMD

• Raise $135K through Advisory Board, Sponsorship, and Personal

Donations Target hire dates, depending on fundraising goals, are late Spring early Summer of 2018 In the year following the hire of a new RMD in each new market, the goal is to increase child count by 1,500. Once a new market has a RMD in place, then National BIB would start the new market process over, by adding another city.

FY18 Budget Student Headcount Growth

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Children Served 7/1/17 Projected Balance 94,499 Existing Legacy Programs 6,693 New Grassroots Growth 5,408 Program Staff Driven 5,408 Less Attrition (5,600) 6/30/18 Projected Budget 106,408

Notes:

• Increase of appx. 12,000 students, net of attrition, is nearly double FY17 growth
• Looking for increased productivity of assets put in place
• Need to identify partnerships that will DRAMATICALLY increase the number of

children served per programàcan’t rely on grassroots growth with 50 children/school

• The 5 year strategic plan called for FY17 ending headcount to be 140,000 225,000

for FY17 and FY18, respectively

Organizational Growth

FY 2018 budget includes one FD position empty July to mid-September, that role being part-time starting in September and the addition of 1 new FTE in Fund Development, starting in Jan 2018.

Green= Currently Filled Positions Blue= New Budgeted Positions for FY18 CEO Executive Assistant CFO/COO Chief Development Officer Chief Program Officer Chief Marketing Officer Vendor Relations Manager Accounting Coordinator HR and IT Contract work as needed Accounting Specialist Director of Accounting Associate Director of Corporate Relations Associate Director of Development (Empty July & August, PT Mid- Sept On) Manager, Foundation & Corporate Relations Communications Manager Director of Program Operations Volunteer Services Manager Regional Managing Directors – Chi, Lou, Jax, SWFL Associate Director of Individual Giving (Jan ’18) Volunteer Services Coordinator Fund Development Coordinator Program Managers – 1 FT 3 PT Director of Athletic Partnerships Director of Strategic Initiatives

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Fiscal Year 2018 Financial Budget Highlights

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Student Headcount/Food Revenue Headcount growth and food revenue is distributed during the year based on a 3 year average of headcount/food revenue distribution Program Support Revenue The $10 per child program support revenue from schools will be measured based on headcount in a school at the end

• f month in October and March. Payment to corporate will be made in November and April with $5.00 being charged

at each measurement. Revenue, however, is spread across each 6 month associated with each measurement date. Legacy schools program charge is 2% of collections each month with monies coming to corporate at that time. Regional Managing Director (RDM) Additions Targeted markets to expand into include Los Angeles, Atlanta and DC. Director of Strategic Initiatives to obtain the funding of the annual expected cost (approx. $100k) of an RDM prior to hiring of the position. Expected hire dates are:

• Los Angeles – March 2018
• Atlanta – May 2018
• DC – May 2018

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Fiscal 2018 Budget Key Assumptions

Jul-17 Aug-17 Sep-17 Oct - 17

Measurement

Nov - 17

Payment

Dec-17 Jan-18 Feb-18 March - 18

Measurement

April - 18

Payment

May-18 Jun-18 Headcount Growth Distribution 12% 15% 14% 5% 6% 7% 3% 10% 9% 12% 5% 2% Food Revenue Distribution 9% 9% 8% 10% 9% 10% 6% 8% 7% 9% 6% 7% Revenue Example: Headcount Measurement 1,000 1,200 Charge Per Headcount 5.00 $ 5.00 $ Amount Charged 5,000 $ 6,000 $ Monthly Revenue Recognition 833 $ 833 $ 833 $ 833 $ 833 $ 833 $ 1,000 $ 1,000 $ 1,000 $ 1,000 $ 1,000 $ 1,000 $ Cumulative 833 $ 1,667 $ 2,500 $ 3,333 $ 4,167 $ 5,000 $ 1,000 $ 2,000 $ 3,000 $ 4,000 $ 5,000 $ 6,000 $

FY 2018 Budget - Statement of Operations

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Budget 2018 Projected 2017 Budget 2018 Projected 2017 Budget 2018 Projected 2017 Variance Revenues Unrestricted Donations $3,420,860 $2,266,092 $3,420,860 $2,266,092 $1,154,768 51% Program Revenue $8,998,306 $7,190,895 $8,998,306 $7,190,895 $1,807,411 25% Fundraising Events (Net) - Unrestricted $0 $171,520 $198,433 $171,520 $198,433 ($26,913) Restricted Unrestricted Total FY Other Income/Gift $0 $22,700 $22,700 ($22,700) Investment Income $28,091 $30,330 $28,091 $30,330 ($2,239) Total Revenue $8,998,306 $7,190,895 $3,620,472 $2,517,555 $12,618,778 $9,708,450 $2,910,328 30% Expenses Food & Backpack $9,203,855 $7,018,961 $73,775 $55,336 $9,277,630 $7,074,297 $2,203,333 31% Staff $2,348,869 $2,007,957 $2,348,869 $2,007,957 $340,912 17% Contract Services $93,500 $146,454 $93,500 $146,454 ($52,954) -36% Administrative $524 $375,296 $329,699 $375,296 $330,223 $45,073 Depreciation Expense $14,400 $15,478 $14,400 $15,478 ($1,078) Marketing $4,500 $83,242 $26,686 $83,242 $31,186 $52,056 167% Travel $167,744 $128,502 $167,744 $128,502 $39,242 31% Other $1,426 $1,426 ($1,426) Total Expenses $9,203,855 $7,023,985 $3,156,826 $2,711,538 $12,360,681 $9,735,523 $2,625,158 27% Increase (decrease) in Current Net Assets ($205,548) $166,910 $463,646 ($193,983) $258,097 ($27,073) $285,170 Direct Program Expense %, prior to Indirect Expense Allocation 75% 73%

Non-food Revenue has increased due to increased Fund Development work, as well as the 2% Program fee and $10 Program Fee that will be in effect all year. Program Food Revenue has increased because we are adding approx 10K children, plus the food cost is moving from $80 to $90 year child per year. Food Expense as increased, because of the child count increase and food cost increase mentioned above. Staff Increase - There is 1 new staff FTE projected in Jan 18, there are 3 projected Managing Directors in late spring, only if funding is raised in advance. The other driver of the staff increase, are the new staff positions that were hired mid-year 2017, that will now have a full year of salary impact. Contract Services are down because there is currently no budget for Food Logistics or services from Davidoff Consulting. Marketing is up to help in the existing markets, as well as new target markets. We also have money budgeted for National PC Conferences. Travel is up due to the work in the existing target markets (Managing Directors), new target markets (LA, DC and Atlanta) and for Program Managers within their territories.

FY 2018 Statement of Monthly Net Income

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Budget Budget Budget Budget Budget Budget Budget Budget Budget Budget Budget Budget Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18 Apr-18 May-18 Jun-18 Full Year FY18 Total Income 1,082,289 898,362 689,927 1,217,732 1,337,049 1,442,417 868,852 906,893 787,388 924,987 1,111,507 1,351,375 12,618,778 Total Expense 235,908 729,833 1,199,526 1,191,169 1,202,895 966,301 1,233,106 1,243,727 1,251,242 1,277,386 1,294,788 534,800 Net Income(Loss) 846,381 168,530 (509,599) 26,563 134,155 476,116 (364,255) (336,834) (463,853) (352,399) (183,281) 816,575 12,360,681 258,097 Cumulative YTD 846,381 1,014,911 505,312 531,874 666,029 1,142,145 777,891 441,056 (22,797) (375,196) (558,477) 258,097 Restricted - Food Revenue 963,593 803,387 586,150 824,043 1,017,882 864,077 556,789 686,179 554,453 681,787 541,165 918,801 Food Expense

• (462,714)

(941,078) (946,554) (953,176) (720,701) (964,146) (975,287) (985,292) (998,706) (1,004,182) (252,019) Net 963,593 340,673 (354,928) (122,511) 64,706 143,376 (407,357) (289,109) (430,838) (316,919) (463,017) 666,782 YTD 963,593 1,304,266 949,338 826,827 891,533 1,034,909 627,552 338,443 (92,395) (409,314) (872,331) (205,548) Unrestricted - Non-food Revenue 118,696 94,975 103,777 393,689 319,167 578,340 312,063 220,714 232,935 243,200 570,341 432,574 Operating Expense (235,908) (267,119) (258,448) (244,615) (249,719) (245,600) (268,960) (268,440) (265,950) (278,680) (290,605) (282,782) Net (117,212) (172,144) (154,671) 149,074 69,449 332,740 43,103 (47,726) (33,015) (35,480) 279,736 149,792 YTD (117,212) (289,356) (444,027) (294,953) (225,504) 107,236 150,339 102,613 69,598 34,118 313,853 463,646 Grand Total 258,097 National Operations runs a net loss for the first 5 months of the year. $425K of the full year National Office Net Profit occurs in the last 2 months of the year 258,097 8,998,306 (9,203,855) (205,548) 3,620,472 (3,156,826) 463,646

FY 2018 Statement of Monthly Unrestricted Cash Flows

31

Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18 Apr-18 May-18 Jun-18

Unrestricted Cash Beginning Balance 516,131 477,521 324,315 175,323 312,074 413,040 738,457 764,871 705,523 660,885 683,811 951,923 Collections School 2%

• 6,653

13,335 13,344 13,356 10,027 20,062 20,091 20,118 20,154 20,168 5,047 School $10 pp

• 43,840
• 70,030
• Regional Manager

14,167 14,167 14,867 33,417 30,167 33,917 15,967 15,167 15,167 15,167 19,667 15,167 National Board of Directors 7,500 7,500 7,500 7,500 7,500 7,500 7,500 7,500 7,500 7,500 7,500 7,500 New Target Markets

• 22,500

37,500 30,000 22,500

• 82,500

52,500 30,000 97,500

• Ohio Health
• 15,000
• 15,000
• 15,000
• 15,000
• National Driven

Events

• 50,000

20,625 5,730

• 10,000

20,000 27,930 12,235 25,000 Individuals 15,000 21,000 20,750 21,350 60,450 150,250 33,100 25,100 37,100 61,100 27,100 31,100 Atheletes 6,375 8,000

• 26,175

37,500 26,100 4,375 21,720 26,500 3,875 2,500 2,000 Corporations 65,650 12,600 14,800 141,400 39,560 154,799 166,700 9,400 39,900 58,400 29,690 292,200 Foundations

• 53,000

55,000 157,500 50,000

• 5,000

325,000 40,515 Other 250 250 250 250 250 250 250 250 250 250 250 250 Interest Income 1,156 1,276 1,254 1,230 1,237 1,244 1,220 1,164 1,078 1,001 907 970 Transfers from investments 40,000 18,000 Purchase of Assets (5,000)

• (5,000)
• Collections on AR

46,000 8,267 3,000 5,000

• Less Disbursements

Non Payroll Operating Expense (64,564) (95,776) (68,861) (75,028) (70,132) (66,014) (82,107) (81,587) (71,830) (84,560) (83,315) (75,491) Payroll & Taxes (170,143) (170,143) (178,387) (178,387) (178,387) (178,387) (185,653) (185,653) (192,920) (192,920) (206,091) (206,091) Ending Balance 477,521 324,315 175,323 312,074 413,040 738,457 764,871 705,523 660,885 683,811 951,923 1,090,090 Regional Manager Restriction Revenue

• (22,500)

(37,500) (30,000) (22,500)

• (82,500)

(52,500) (30,000) (97,500)

• Expense

2,000 2,000 3,000 1,000

• 8,864

10,664 24,282 24,282 Net Balance Cumulative 2,000 4,000 (15,500) (52,000) (82,000) (104,500) (104,500) (187,000) (230,636) (249,972) (323,190) (323,190) Net Balance after New Markets 479,521 328,315 159,823 260,074 331,040 633,957 660,371 518,523 430,249 433,839 628,732 766,900 Peg Balance - 2 months avg opr exp 500,000 500,000 500,000 500,000 500,000 550,000 550,000 550,000 550,000 550,000 550,000 550,000 Over (Under) Peg (20,479) (171,685) (340,177) (239,926) (168,960) 83,957 110,371 (31,477) (119,751) (116,161) 78,732 216,900

FY 2018 P&L Geographical Overview

Market

Louisville LA DC Atlanta Chicago Jacksonville Southwest Fl All Other Non-Target Corporate Total

Date of Hire

Jan-17 Mar-18 May-18 May-18 Aug-17 Sep-17 Nov-16

Beginning FY Headcount (projected)

6,759 50 204 500 5,664 10,008 3,162 68,152 N/A 94,499

Ending FY Headcount (budget)

8,753 250 500 1,000 7,650 10,773 4,142 73,340 N/A 106,408

Revenue Food

725,462 15,603 34,728 74,061 626,893 945,448 342,265 6,233,847 . 8,998,306

Nonfood

76,051 136,107 107,098 139,024 126,451 60,905 87,780 214,811 2,672,245 3,620,472

Total Revenue

801,513 151,710 141,826 213,085 753,343 1,006,353 430,045 6,448,659 2,672,245 12,618,778

Cost of Food

(725,462) (15,603) (34,728) (74,061) (626,893) (945,448) (342,265) (6,439,396)

• (9,203,855)

General & Administrative

(76,074) (40,256) (19,184) (16,651) (88,807) (83,778) (83,954) (278,603) (2,469,519) (3,156,826)

Increase/(Decrease) in Total Net Assets

(23) 95,851 87,914 122,374 37,644 (22,873) 3,826 (269,340) 202,726 258,097

Less Balance Revenue Raised in FY18 for future years expenses

94,744 85,816 118,349

Net Contribution to National Office

(23) 1,107 2,098 4,024 37,644 (22,873) 3,826 (63,792) 202,726 164,737 =(Non-Food Revenue Less G&A Expense) LA, DC, ATL only start when money is raised up front SWFL was part time RMD since 2015, went full time as RMD Nov 2016

FY 2017 vs FY 2018 Balance Sheet – Projected

33

Assets

Cash ST Investments Acct Rec Pledges Rec Other Current Assets Fixed Assets Acc Depr Total

Total Assets Liabilities and Net Assets Liabilities

Accounts Payable Accrued Liabilities

Total Liabilities

Net Assets - Temp Restricted Net Assets - Unrestricted Total Net Assets

Total Liabilities and Net Assets Restricted Unrestricted Total

4,647,620 $ 516,131 $ 5,163,751 $ 2,962,542 137,097 3,099,639 2,959 1,302 4,261 284,206 100,509 384,715 4,782 18,688 23,470 119,038 119,038 (98,870) (98,870) 20,168 20,168 7,902,109 $ 793,895 $ 8,696,004 $ 320,563 $ 25,221 $ 345,784 $ 460 70,752 71,212 321,023 95,973 416,996 506,516 $ 117,754 $ 624,270 $ 7,074,570 580,168 7,654,738 7,581,086 697,922 8,279,008 7,902,109 $ 793,895 $ 8,696,004 $ 6/30/2017 - Projected

Restricted Unrestricted Total

4,695,800 $ 1,090,090 $ 5,785,890 $ 12% 2,674,542 93,450 2,767,992

• 11%

2,959 1,302 4,261 284,206 38,242 322,448

• 16%

4,782 18,688 23,470 0% 129,038 129,038 8% (127,670) (127,670) 1,368 1,368 7,662,289 $ 1,243,141 $ 8,905,429 $ 286,291 $ 25,221 $ 311,512 $ 460 70,752 71,212 286,751 95,973 382,724 218,516 $ 77,754 $ 296,270 $

• 53%

7,157,022 1,069,414 8,226,435 7,375,538 1,147,168 8,522,705 7,662,289 $ 1,243,141 $ 8,905,429 $ 6/30/2018- Forecast Cash has increased due to increased Investments decreased at 6/30/18 d Unrestricted Pledges Receivable decr Fixed Assets increased due to the pu Temp Restricted Net Assets have dec ased growth 8 due to decreased e purchase decrease rowth in children feed, revenue for new market e to NUDM Funds transferred to cover children f ased since 6/30/17, as we collected outstanding hase of replacement laptops for old units. eased at 6/30/18 as NUDM and other food relate arket expansion and NUDM Funds transferred from Investments ren feed in FY18. ding pledges during the year. related Funds have been released during the year to feed kids.

Nationally Driven Revenue Trend

34 Total Nationally Driven Revenue

• 500,000

1,000,000 1,500,000 2,000,000 2,500,000 3,000,000 3,500,000 4,000,000 4,500,000 2015 Actual 2016 Actual 2017 Projected 2018 Budget NonFood Food

Please note, 2016 included NUDM and some school investors donating their 2017 gift early. Also, in FY15, National Staff did not have goals/responsibilities to raise food support, and thus was not tracked at that time.

2015 Actual 2016 Actual 2017 Projected 2018 Budget Grand Total Food 2,704,969 1,802,749 1,773,436 NonFood 1,524,278 2,141,528 2,373,551 2,614,154 Total 1,524,278 4,846,497 4,176,300 4,387,590 Athletics Food 423,680 496,158 602,540 NonFood 79,720 86,720 95,129 165,120 Total 79,720 510,400 591,287 767,660 Corporations Food 1,317,221 841,163 900,896 NonFood 535,352 611,069 853,267 1,025,099 Total 535,352 1,928,290 1,694,430 1,925,995 Events, Net Food 639,043 NonFood 139,979 478,379 198,433 171,520 Total 139,979 1,117,422 198,433 171,520 Foundations Food 239,165 149,485 NonFood 504,791 622,234 666,622 686,015 Total 504,791 861,399 816,107 686,015 Government Food 85,860 240,670 270,000 NonFood 21,420 64,123 60,000 Total 107,280 304,793 330,000 Individuals Food 75,273 NonFood 245,709 318,562 485,244 503,400 Total 245,709 318,562 560,517 503,400 Other Food NonFood 18,727 3,144 10,733 3,000 Total 18,727 3,144 10,733 3,000

FY18 Total Nationally Driven Revenue

35

Forecasted FY17 and budgeted FY18 total (food and nonfood) revenue driven by national staff members, not including managing directors or nonfood support from volunteer teams.

Key Notes 1) In addition to increasing nationally driven revenue, the national

• rganization must also fill the gap

from transferring donors to MDs. 2) FY17 Foundation food support is transferring to MDs. 3) FY17 Individual food support was Larry Patrick.

Category Food Nonfood Total Food Nonfood Total Food Nonfood Total

Athletes 496,158 95,129 591,287 602,540 165,120 767,660 Corporations 841,163 853,267 1,694,430 900,896 1,025,099 1,925,995 153,806 64,417 218,223 Events, Net YTD 198,433 198,433 171,520 171,520 22,301 22,301 Foundations 149,485 666,622 816,107 686,015 686,015 142,883 23,717 166,600 Government 240,670 64,123 304,793 270,000 60,000 330,000 Individuals 75,273 485,244 560,517 503,400 503,400 Other 10,733 10,733 3,000 3,000

Total 1,802,749 $ 2,373,551 $ 4,176,300 $ 1,773,436 $ 2,614,154 $ 4,387,590 $ 296,689 $ 110,435 $ 407,124 $ FY17 Forecast FY18 Budget FY17 Revenue Transferring to MDs

Category Food Nonfood Total Food Nonfood Total

Athletes 21.4% 73.6% 29.8% 21.4% 73.6% 29.8% Corporations 7.1% 20.1% 13.7% 25.4% 27.7% 26.5% Events, Net YTD 0.0%

• 13.6%
• 13.6%

0.0%

• 2.3%
• 2.3%

Foundations 0.0% 2.9% 2.9%

• 4.4%

6.5% 4.5% Government 9.1%

• 36.2%
• 3.3%

9.1%

• 36.2%
• 3.3%

Individuals 0.0% 3.7%

• 10.2%

0.0% 3.7%

• 10.2%

Other 0.0%

• 72.0%
• 72.0%

0.0%

• 72.0%
• 72.0%

Total

• 2.5%

9.4% 4.4% 14.7% 14.0% 14.3% Forecast to Budget % Variance % Variance with Transferring Revenue

FY18 Nonfood Revenue from National Donors

36

Category Not Identified Identified Total Not Identified Identified Total Prospective Veteran Total

Athletes 16,000 79,120 95,120 51,500 43,620 95,120 33,000 132,120 165,120 Corporations 454,250 478,220 932,470 430,665 422,602 853,267 539,950 485,149 1,025,099 Events, Net YTD 21,500 185,000 206,500 23,433 175,000 198,433 70,840 100,680 171,520 Foundations 104,500 621,800 726,300 62,496 604,125 666,621 63,515 622,500 686,015 Government 21,420 21,420 64,123 64,123 60,000 60,000 Individuals 143,500 245,000 388,500 218,087 267,157 485,244 375,760 127,640 503,400 Other 3,000 3,000 10,733 10,733 3,000 3,000

Total 742,750 $ 1,630,560 $ 2,373,310 $ 796,914 $ 1,576,627 $ 2,373,541 $ 1,086,065 $ 1,528,089 $ 2,614,154 $ FY17 Budget Nonfood Revenue FY17 Forecasted Nonfood Revenue FY18 Budgeted Nonfood Revenue Category Prospective Veteran Total

Athletes (18,500) 88,500 70,000 Corporations 109,285 62,547 171,832 Events, Net 47,407 (74,320) (26,913) Foundations 1,019 18,375 19,394 Government (4,123) (4,123) Individuals 157,673 (139,517) 18,156 Other (7,733) (7,733) Total

289,151 $ (48,538) $ 240,613 $ Variance, FY17 Forecast to FY18 Budget FY2018

Nonfood Budget Forecast Budget Forecast Budget Prospective 665,883 713,561 742,750 818,334 1,086,065 Total 2,075,890 2,108,544 2,373,310 2,372,090 2,614,154 % of Total 32.1% 33.8% 31.3% 34.5% 41.5%

• Inc. Over Prior

47,678 29,189 75,584 267,731

FY2016 FY2017

Due to FY18’s increase in the nonfood revenue goal of $240k over FY17 forecast plus transferring FY17 donors that gave $110k of nonfood support to MDs, the national donor nonfood revenue goal for prospective donors is substantially higher in both dollar amount and percentage of total revenue than in past years. This is noteworthy as it costs more and is more difficult to raise a dollar from a prospective donor than a current one.

New Areas of Work – Fund Development

In addition to continuing past efforts, new areas of work with a focus on building critical nonfood or general

• perating support include:
• Athletics:
• Transition the remaining food-only school investors to provide nonfood support needed for their school.
• Work to raise more general operating support to support our work nationally or in a specific region.
• Better leverage our relationships with activation agreements with defined support beyond financial.
• Corporate Partnerships:
• Target more corporations for sponsorships ($75,000 of prospective) and cause-marketing campaigns

($185k total, $55k of which is prospective).

• Secure travel/hospitality in-kind support ($50,000 of prospective support)
• Increase revenue from grant applications ($125,000 of prospective support)
• Build the corporate pipeline through employee engagement packing events and transitioning packers to

additional support.

• Foundations – Secure $63k in new revenue
• Individuals:
• Retain new donors secured in FY17
• Move more donors up the giving ladder
• Greater donor stewardship
• Fully leverage Marketing’s efforts to replenish the donor database.

Other new tasks include:

• Review and update current donor marketing materials and create new ones to align with the focus areas above.
• Improve use of donor database and other technology tools to increase efficiency and identify opportunities.
• Lead national efforts to build BIB’s presence in the geographic areas targeted for infrastructure development.
• Expand the tools and trainings offered to managing directors and volunteers.

37

Revenue by Channel

With the evolution of Blessings in a Backpack’s organizational structure, the organization’s revenue channels have also evolved. Below shows what fundraising channel is responsible for food and nonfood revenue, whether it be national staff, managing directors, or grassroots volunteers. This diversification expands the organization’s sustainability and further diversifies the funding. Fiscal Year 2018 reflects the second year of execution of the strategy to grow within geographical regions under the direction of managing directors and new grassroots schools funding a portion of their non-food expense. The four managing directors were hired throughout FY17, with all starting by December. Excludes 3 new target market revenue and National board support. 38

2015 Actual 2016 Actual 2017 Projected 2018 Budget National Staff Food 2,704,969 1,802,749 1,773,436 Nonfood - School Investor & GOP* 1,524,278 2,141,528 2,373,551 2,614,154 Total 1,524,278 4,846,497 4,176,300 4,387,590 Managing Directors (4 Current) Food 1,806,000 2,640,067 Nonfood 71,000 351,187 Total 1,877,000 2,991,254 All Other Markets Food 6,223,545 4,843,810 3,582,146 4,584,803 Non Food 29,838 162,039 Total 6,223,545 4,843,810 3,611,984 4,746,842 All Channels Food 6,223,545 7,548,779 7,190,895 8,998,306 Nonfood - School Investor & GOP* 1,524,278 2,141,528 2,474,389 3,127,380 Total 7,747,823 9,690,307 9,665,284 12,125,686 *GOP = General Operating revenue. Can be used as needed to fund the organizations operations. Compared to School Investor nonfood support that is restricted to expenses necessary to feed that child.

Revenue by Channel, Food only

Fiscal Year 2018 reflects the second year of execution of the strategy to grow within geographical regions under the direction of managing directors and new grassroots schools funding a portion of their non-food expense. The four managing directors were hired throughout FY17, with all starting by December. 39

• 1,000,000

2,000,000 3,000,000 4,000,000 5,000,000 6,000,000 7,000,000 8,000,000 9,000,000 10,000,000 2015 Actual 2016 Actual 2017 Projected 2018 Budget All other markets Managing Directors NaEonal Staff

Revenue by Channel, Non-food only

Fiscal Year 2018 reflects the second year of execution of the strategy to grow within geographical regions under the direction of managing directors and new grassroots schools funding a portion of their non-food expense. The four managing directors were hired throughout FY17, with all starting by December. 40

• 500,000

1,000,000 1,500,000 2,000,000 2,500,000 3,000,000 3,500,000 2015 Actual 2016 Actual 2017 Projected 2018 Budget All other markets Managing Directors NaConal Staff

• The FY 2018 Budget reflects a tight budget that allows us to solidify and to maintain the foundation

needed to move forward through the strategic plan. There are risks in the budget that will require us all to participate in fund raising at every level.

• The strategic growth model is based on strengthening the new chapter structure in Chicago,

Louisville, Southwest Florida and Jacksonville. Those positions are now all up and running and have responsibilities to increase the dollars and child numbers during this year. The budget also reflects stage two of our new markets board and staff roll in Los Angeles , Atlanta and Washington DC. This will be supplemented by one new target market in the spring.

• National corporate relationships are requiring time to nurture.
• Our new Program Price Points for grass roots programs are up and running but we must still expect

some fallout in our numbers in this area. Time and effort will be spent on continued messaging and delivery of this across the country.

• Our efforts to provide revision of our food logistics across the country need a supplement of donor

dollars to quickly get this up and running.

• Overall, we are aware of the challenges and the risks but these are necessary to affect change in

the organization. We are fully committed to the work that is involved and continue to dedicate

• urselves to feeding more hungry children across the country while keeping our eye on building a

sustainable program for the future.

41

Strategic Plan Highlights and Risks

Resources Needed

42

• Expansion of fund raising through Board efforts
• Identification and cultivation of potential new donors – corporate, foundation,

individuals

• National speaking opportunities
• Introductions to influencers – especially in our target Markets ( Atlanta, Washington DC

and Los Angeles)

• Athletes
• Prominent persons and community leader
• National associations and organizations
• Lead gifts to fund our growth – particularly for food logistics and for national sponsorships
• Gift to draw from during seasonal cash flow periods
• We have two positions we had hoped to add which are not funded. One for marketing and
• ne for fund development.