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From the Chief Financial Officer

We are pleased to present audited financial statements for the year ended 30 June 2019.

The financial statements of the Australian Red Cross Society (the Society) incorporate both the Humanitarian Services of Red Cross and Australian Red Cross Blood Service operating divisions. The Blood Service division provides quality blood products, tissue typing and related services for patients in need. In FY2019 the Blood Service division also began providing a safe, secure and reliable source of donated breast milk to babies in hospital. Red Cross Humanitarian Services supports and empowers people and communities experiencing vulnerability.


This financial year we continued to successfully deliver against our objectives to support Australian and global communities. The Society reported total revenue of $867.401 million of which $642.927 million funded the Blood Service and $224.474 million was for Humanitarian Services. 

The Society used most of these funds, as well as $22.079 million of revenue received and recognized in prior years, to deliver on our commitments, reporting a net deficit of $19.551 million ($1.418 million surplus from Blood Service and $20.969 million deficit from Humanitarian Services). 

Maintaining and growing our revenue is under continued pressure. In FY2019 we received less government funding than in previous years. We also received less revenue from our fundraising activities than we forecast. This is not unique to Red Cross – most not-for-profit organisations are seeing a decline in traditional channels like face-to-face fundraising, regular giving and community fundraising. We have put in place new fundraising channels and products but these take time to test and iterate so that they can deliver significant revenue. 

This year we implemented AASB9 Financial Instruments. We also early adopted AASB1058 and AASB15, which when compared to prior year, may defer the timing of revenue recognition. 

Humanitarian Services

Our overall result for Humanitarian Services was a deficit of $20.969 million. This deficit was largely driven by expenses, for delivering programs, where the revenue for those programs was recognised in prior years. As such, this deficit is funded from our reserves. We currently have $72.238 million in cash and investments and no borrowings. 

The Australian public donated more than $90.412 million to help us deliver programs and strengthen communities. Our Humanitarian Services revenue also included $47.959 million from Commonwealth Government grants and $36.781 million from State and territory government grants. Together this enabled us to build capacity within the communities we work with, support people to live safely and to provide relief where required. 

Total government funding declined by $34.352 million compared to FY18. This was largely due to an $18.653 million reduction attributable to the end of our SRSS migration support contract, as well as a decline in regular donations. However, we made the decision to continue supporting communities and people we believe are core to our purpose. 

We continue to support migrants in transition. We continue to collaborate to strengthen socially excluded communities, including Aboriginal and Torres Straight Island peoples, those in the justice system, and communities most impacted by climate change. 

Compared to previous years, there has been a higher frequency and severity of emergencies. We received $11.500 million in drought appeal funds, which were fully disbursed. This supported individual and household health and wellbeing through grants to meet everyday household expenses, and providing access to social, health and educational activities affecting rural communities in NSW, QLD, VIC and SA. We are also investing in preparing and building resilience across communities as climate change has resulted in more people being impacted by natural disasters and extreme temperature conditions, in more locations than before. 

Blood Service

Our Blood Service division finished the year with a surplus of $1.418 million. This represents another successful year and the tenth consecutive operating surplus recorded. The full operating program surplus was $74.814 million. Under our Deed of Agreement with the National Blood Authority the majority of this surplus was returned. The Blood Service can retain a portion of this surplus of up to $5.000 million for future investment. 

Our primary funding arrangement is with the National Blood Authority under an output-based model. Our performance under this arrangement was strong again this year with continued growth in plasma where we achieved our target of 736 tonnes of plasma for fractionation whilst continuing to reduce the unit cost. 

Maintaining a stable and secure blood supply requires continual investment. This year, we invested $53.490 million of funding from the National Blood Authority into the upgrade of infrastructure, technology and equipment. 

Outside of our output-funding arrangement with the National Blood Authority, we initiated milk bank operations and continued to provide a range of related services such as transplant and immunogenetic services across New South Wales, Victoria and South Australia. 

Our Blood Service cash and investment position remains strong at $315.708 million, including the repayment of borrowings of $13.400 million. 

Cameron Power
Chief Financial Officer
October 2019