Varsity Expects Strong Gains in '04

With 300 schools committed to its eduPartners program, Varsity Group is positioned to "significantly" improve on last year's financial performance, said chairman Eric Kuhn. At this point in 2003, Varsity served as the online bookstore for 200 schools and distance learning organizations, and the company finished the year with sales of $25.2 million and net income of $4.4 million. Before it enters its busiest selling season in July, Kuhn said, Varsity could add more schools to its eduPartners ranks.

Kuhn's prediction accompanied the release of Varsity's first quarter report, which heralded a 49.4% sales increase in the period ended March 31, to $1.8 million, and a reduction in its net loss to $351,000 from $444,000. The increased sales allowed Varsity to trim its loss despite an increase in operating expenses that the company said was due to expanding its operations. With the exception of product development, operating expenses rose in all areas, including sales and marketing, where Varsity added new sales and marketing staff. In another sign of its growth, Varsity signed a short-term lease last month for an additional 2,000 square feet of space at its Washington, D.C., headquarters.

The company also reported that it has renewed its fulfillment agreement with Baker & Taylor through June 2006.