ELCA Makes Money on New Hymnal

ELCA NEWS SERVICE

October 31, 2007

Augsburg Fortress Board Acts on ELCA Publisher's Future
07-176-JB

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.