ELCA NEWS SERVICE

May 2, 2005

Augsburg Fortress Publishers Showing Positive Signs For 2005
05-081-JB

     MINNEAPOLIS (ELCA) -- The board of trustees of Augsburg Fortress, the
publishing ministry of the Evangelical Lutheran Church in America (ELCA),
heard reports that suggest the publisher may have a much better year in
2005 compared to 2004.  Highlights included a better-than-forecast first
quarter financial report and several new products with promising sales
potential, according to company managers.
     The trustees held their spring meeting here at the publisher's
offices April 22-23.
     To help the publisher achieve its 2005 goal of at least breaking
even -- for the first time in many years -- it is critical "that all
institutions of the church consider Augsburg Fortress resources," said
Beth A. Lewis, president and chief executive officer.
     "When we are competitive in quality, price and service, then the
choice becomes a stewardship choice," she said in an interview with the
ELCA News Service.  "I'm asking that the church support this ministry, so
that any profits can be reinvested into new ministry resources for this
church."
     "Forget the old Augsburg Fortress," said James (Jim) Myers, board
chair, Kailua, Hawaii.  "There is a new Augsburg Fortress, and we say this
is positive for the church."  This was Myers' final meeting as board
chair.
     In her report to the board, Lewis said the company's product teams
and employees are using a goal-oriented performance system called
"Balanced Scorecard," which constantly measures work performance.
     For example, in a study of company service response time, results
showed that orders are sent to customers within 24 hours of when the order
is placed more than 99 percent of the time, she said.
     In addition, the ELCA Department for Research and Evaluation
conducted customer satisfaction surveys, Lewis said.  In a benchmark study
conducted in October 2003, customers rated the company service less than 4
on a 5-point satisfaction scale.  By December 2004, the rating had climbed
to 4.5, she said.
     "Positive change is happening," Lewis said.  "We are getting rave
reviews from our customers.  We are pushing all of our staff really hard."
     Sales for the first quarter of 2005 were ahead of the budget
forecast, she said.  The company was able to achieve positive cash flow
because of good sales and in part because of some decisions it made in
December and January, Lewis said.  In 2004 Augsburg Fortress closed its
ecclesiastical arts studio in Philadelphia, and in early 2005 discontinued
product lines and consolidated overhead costs.  About 40 staff positions
were eliminated.
     The company continues to reduce operating expenses, including
consolidation of its office space here from three floors to two, Lewis
said.  Augsburg Fortress is focusing on customers, and emphasizing better
internal communication and "cross-fertilization" among product development
and sales teams, she said.
     The publisher is also focusing more attention on the needs of larger
congregations, a move which should help the company financially, Lewis
said.  At the same time, Augsburg Fortress will not abandon small- and
medium-sized congregations, she emphasized.
     "We must meet our sales goal," Lewis told the board.  "We need
everyone in this church to help us."

Positive Financial Report for First Quarter, Finance Officer Reports
     The most important financial result from the first quarter of 2005 is
that Augsburg Fortress was able to generate cash from its operation, said
George Poehlman, vice president for finance, and treasurer.  It generated
$782,172 in positive cash flow, $662,070 more than budgeted, Poehlman
reported.
     "Results from the first quarter of the year have been better than
predicted," he wrote in his report to the board.
     The company's first quarter sales were nearly $9.5 million, $387,000
better than budgeted, he said.  Overall, Augsburg Fortress finished the
first quarter ahead of its budget with an operating loss of only $110,000,
Poehlman said.
     Calling the first quarter results "an excellent start," Poehlman said
"this may be the best first quarter report that I've had the opportunity
to give you."  Sales were better than expected for products in the
Congregational Life and Learning group, the company's Canadian operation
and ecclesiastical arts supplies, he said.
     The board also learned that Poehlman will retire from Augsburg
Fortress this summer.
     "It has been my privilege and honor to serve as the chief financial
officer and to work with all of you," he told the board at the conclusion
of his report.  "I thank you."

Company Anticipates Good Sales of New Resources
     In his report to the board Jim Donohue, Augsburg Fortress senior vice
president, sales and marketing, said the company's sales force is focused
and stable, and he predicted the publisher will make its sales goal for
2005.
     Donohue and other senior staff reviewed several newly introduced
products for 2005:
     + "Splash!," a series of faith-formation resources for children from
infancy to age three, produced sales more than double its budget since its
introduction in November 2004.
     + "Here We Stand," a new Confirmation curricula will soon be
introduced.  A demonstration is available at
http://www.herewestandconfirmation.org on the Web. A key part of the
series is a new "The Lutheran Handbook: A Field Guide to Church Stuff,
Everyday Stuff, and the Bible," a serious and sometimes humorous book
about being Lutheran, intended for Confirmation students.  The company
sold out quickly of its first printing of the handbook.  A second printing
edition is expected to be available May 11.
     + "No Experience Necessary" is a newly introduced Bible study series
written by the Rev. Kelly A. Fryer, author of the best-selling book,
"Reclaiming the 'L' Word. Fryer's book was the first volume in the
publisher's "Lutheran Voices" series
     + In June Augsburg Fortress will unveil sundaysandseasons.com, a
Web-based worship planning tool that includes an electronic library of
Biblical texts, hymns, visual images and research tools
     + An anticipated seven-volume series, "The People's History of
Christianity," will be produced over a five-year period.  The first two
volumes, "Christian Origins" and "Late Ancient Christianity" will be
available in November.
     + A new Augsburg Fortress store will be opened in Salisbury, N.C.,
this year, located next to the ELCA North Carolina Synod office and near
Hood Theological Seminary of the African Methodist Episcopal Zion Church.
     + The company's sales of paraments and vestments achieved 65 percent
of its total 2005 sales goal in the first quarter
     "We have great products," Donohue told the board.  "We have the best
products we've had in a long time."
     Donohue said the sales team's greatest concerns for 2005 are
"maintaining a culture that focuses on the customer," profitability, and
improving the company's Internet business.  The company's Web server needs
to be upgraded, so it can be competitive in Internet sales, he said.

New Officers Elected
     The board of trustees concluded its meeting by electing officers who
will assume their new roles following the ELCA Churchwide Assembly in
August.  The board elected Dr. Annette Citzler, La Grange, Texas, as
chair; Michael D. Bash, Long Lake, Minn., vice chair; and Kimberly K.
Folkers, Waverly, Iowa, secretary.
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     Information about Augsburg Fortress Publishers is at
http://www.augsburgfortress.org on the Web.

For information contact:
John Brooks, Director (773) 380-2958 or [log in to unmask]
http://www.elca.org/news