In light of the COVID-19 pandemic, trustees of LifeWay Christian Resources unanimously approved a $210 million budget Tuesday (Aug. 25) for the 2020-2021 fiscal year that includes reductions of 17% year over year.
LifeWay President and CEO Ben Mandrell told trustees that because of declining sales and loss of revenue related to cancellation of summer camps and women’s events, LifeWay projects missing its budgeted revenue for the 2019-2020 fiscal year by $61 million, which would result in a net loss of $21.7 million.
In April, LifeWay instituted spending reductions of approximately 10%, which included staff reductions, a freeze on all hiring and discretionary spending, and suspension of salary increases and matching 401K contributions for all employees. In addition, members of the executive leadership team gave up one month’s salary beginning in May.
Mandrell noted that cost savings enacted in April have somewhat mitigated the impact to LifeWay’s bottom line. Still, the organization will end the year with a significant net loss, he said. Mandrell reminded trustees that LifeWay had been on a growth trajectory prior to the impact of COVID-19.
“We did not see this season coming, but we are responding as we should with cost-saving measures in place, with a close eye on our cash position, preserving the future of the company,” Mandrell said. “We’ve been serving the local church for 129 years, and we are making plans to be around at least 129 more.”
Despite a challenging year, LifeWay’s cash position remains strong and the organization is nearly finished with paying off the leases from the stores.
Mandrell said the organization is planning for the negative impact from COVID-19 to stretch into the first two quarters of FY21.
“It is a wait-and-see situation, but this hasn’t stopped us from looking down the road and plotting the course for the future,” Mandrell said. “Jesus said that even the gates of hell could not hold back the advance of the local church. As long as LifeWay remains close to the body of Christ, adapting to her needs, there is a future for us.”
As for what’s in that future, Mandrell sees a revived church, an acceleration of online products and services from LifeWay, as well as a laser focus on the organization’s core customer: church leaders.
“We believe the local church is going to surge once again, and when it emerges from this season, there will be a renewed passion for ministry, a new joy in worship,” Mandrell said. “Churches are going to see their core return with fresh enthusiasm, ready to serve and to rebuild. Though it may take some time, we believe the Church will recover, and we are getting organized to be ready.”
Mandrell told trustees that the COVID-19 crisis had pushed churches to move online and utilize technology like never before.
“In the coming years, church leaders will conduct far more ministry online, unafraid to harness the technology that got us through a global pandemic,” Mandrell said.
“LifeWay must press the gas to the floor when it comes to developing digital products as well as creating a frictionless online experience. These discussions are top-priority for our team and now is the season to pour great energy into lifeway.com – improving the look, feel and functionality.”
During the meeting, trustees approved a budget for FY21 that has revenue of $210 million and a net loss of $8.6 million. CFO Joe Walker explained to trustees that they are budgeting FY21 as a “bridge year” to FY22 and will be closely monitoring expenses and revenue.
Chief Information Technology Officer elected
Trustees elected Jamie Adams to the position of senior vice president and chief information technology officer. Adams comes to LifeWay from Mspark in Birmingham, Ala., where she served as chief information officer since 2016. At Mspark, a national direct-mail, advertising company, Adams led a team responsible for both internal business technologies as well as customer-facing technologies. Prior to Mspark, she was chief information officer at The Cliffs, a private equity-backed hospitality and real estate company. She has experience in e-commerce, business intelligence and data analytics, and digital applications.
“Jamie brings a wealth of IT leadership expertise that will be invaluable to LifeWay in this new season where much of our business is focused online,” Mandrell said in a statement. “Her proven experience in digital transformation and global leadership will be a huge asset to LifeWay.”
Adams has a bachelor’s degree in business administration/management information systems from the University of Georgia in Athens and an MBA from the University of Alabama in Tuscaloosa.
Update on Ridgecrest, corporate office
Mandrell also shared an update on the sale of Ridgecrest Conference Center and Camps reporting that LifeWay had received several proposals by potential buyers. They have narrowed the offers down to three finalists – each of which have stated their intention to build on the legacy of Ridgecrest and continue the ministry.
“We are very grateful to God for bringing such wonderful groups to us,” Mandrell said. “We are more convinced than ever that this decision will result in a greater kingdom impact for both LifeWay and Ridgecrest.”
The executive leadership team is continuing the feasibility study on the future use of the corporate office building begun in mid-April, Mandrell told trustees.
“The future of work will likely mean a healthy blend of collaborative, in-person meetings as well as the flexibility of working from home,” Mandrell said. He cited a study completed prior to COVID-19 that showed the organization was using its facility at about 60% occupancy on a daily basis.
“LifeWay has embraced the work-from-anywhere culture, allowing our team members to come on campus for strategic meetings and team gatherings, while also enjoying the flexibility of working at home or close to home as much as possible. We believe this need for flexibility is only going to grow as the world changes post-COVID.”
He told trustees a final decision to downsize LifeWay’s headquarters had not yet been made. “Much more study needs to be done. I believe passionately the people we serve and the churches we supply must be the driving force for this decision.”
Mandrell closed his plenary address by thanking trustees for their support and prayers during a difficult season. “The past year has been filled with many griefs,” he said, “but we believe that the Lord is at work in us, pruning us and preparing us for an abundant season ahead.
“I am more resolved than ever, that God called us to LifeWay, to rally this team around common values and strategic mission,” he said. “We have only just begun, but we are eager to see how He will answer more of our prayers as we call upon Him.”
The next LifeWay trustee meeting is scheduled for Jan. 25-26, 2021 in Nashville.
(EDITOR’S NOTE – Carol Pipes is director of corporate communications for LifeWay.)