ELCA NEWS SERVICE
October 31, 2007
Augsburg Fortress Board Acts on ELCA Publisher's Future
MINNEAPOLIS (ELCA) -- The board of trustees of Augsburg Fortress, the publishing ministry of the Evangelical Lutheran Church in America (ELCA), looked toward the future of the ministry by adopting a 2008 budget plan that calls for investment in products and infrastructure. The board also approved a confidential strategic plan for the publisher through 2010.
The board, which met here Oct. 19-20, learned that the company had generated a net operating profit of nearly $3.3 million though Sept. 30 of this year. Net sales of $39,177,000 were spurred by continuing strong sales of Evangelical Lutheran Worship (ELW) resources. John Rahja, chief financial officer, Augsburg Fortress, said ELW sales through Sept. 30 were $11.4 million, most generated by sales of 513,000 copies of the ELW pew edition in 2007. More than 825,000 total copies have been sold since the pew edition was first offered for sale in October 2006.
Augsburg Fortress is expected to finish 2007 with net income, Rahja told the board.
The primary goal of the company's strategic plan for the next three years is "to focus and wisely invest the human and financial resources of this organization for the future," said Beth A. Lewis, president and chief executive officer, Augsburg Fortress.
After adopting the strategic plan the board adopted a proposal authorizing expenditure of up to $2.3 million for a unified "Enterprise Resource Planning" business management system to replace multiple operating systems already being used by the publisher.
"The (investment in) information technology (IT) infrastructure is essential," Lewis said, noting that, because of the company's present systems, its employees have to engage in time-consuming, laborious processes to do routine work. "There is risk in an IT conversion, but I believe there is greater risk in our not doing it," she said.
Based on the company's strategic plan goals and objectives, the board adopted a budget for 2008 that projects a $1.4 million net loss. Michael D. Bash, board chair, Long Lake, Minn., said the board's decision about the 2008 budget was "significant" because the budget proposal required investing $2.8 million in product development and up to $2.3 million in infrastructure improvements. The company's goals and objectives for next year also require taking $1 million from the company's reserves for investment in resources and infrastructure. If the company does not make these investments, Augsburg Fortress risks losing money in future years, Bash said.
"We are using the (financial) success of this year (and) the success of ELW, to fund investments for the future," Bash explained in an interview.
In recent years the trustees have had to make decisions to help Augsburg Fortress survive, he said. "Now we believe that we're making the right decisions to move forward," Bash added.
The trustees adopted a proposal to establish funds "to receive designated and undesignated gifts for current projects in accord with this ministry's purposes and mission." The publisher hopes to use these funds for projects in "underserved markets" that would not be possible without additional funding. In 2006 the trustees established a similar fund, the "One Mission Endowment Fund" which resides in the ELCA Foundation. Contributors can provide money to the endowment fund for special concerns and scholarships, and to honor family, friends and colleagues.
Information about Augsburg Fortress is at http://www.augsburgfortress.org on the Web.
Audio of comments of Beth A. Lewis is at http://media.ELCA.org/audionews/071020a.mp3 and Michael D. Bash is at http://media.ELCA.org/audionews/071020b.mp3 on the ELCA Web site.
For information contact:
John Brooks, Director (773) 380-2958 or email@example.com
ELCA News Blog: http://www.elca.org/news/blog