YTB International (fka YTBLQ)

[xanadu]

YTB head quits, one-third of staff is cut
May 16, 2012 8:03 AM
The Telegraph

WOOD RIVER - The head of YTB International has resigned, the company is cutting one-third of its work force and is now re-evaluating its plans to merge with a Florida firm, the business said in federal filings this week.

YTB International Inc. said the "important restructuring program (is) aimed at restoring the company's profitability and focusing its strategy on its core business of web-based travel-related services."

"The company needs to refocus on organizational improvement and operational execution," Fred Lutzeier, a member of the board of directors, said in a statement. "We believe there are a number of steps that can be taken during the next few months that will improve the operating results of the business."

In connection with the restructuring, Robert M. Van Patten on April 26 submitted his resignation as president, CEO, interim CFO, and as a member of the board, effective immediately.

The company says the restructuring is to unfold over the next 12 months.

"The company would like to thank Bob for his efforts since being appointed CEO in 2009," Lutzeier said.

The board has begun a search for a new president, CEO and CFO. In the interim, the independent directors, led by Lutzeier and Patricia S. Williams, are overseeing a management committee of staff and operating executives that is guiding the daily affairs of the company, he said.

J. Scott Tomer will continue in his roles as chief executive officer of YTB Travel Network Inc. and board chairman.

The company has taken the first step in its reorganization program by implementing a reduction in force. In its Tuesday filing with the Securities and Exchange Commission, YTB said that approximately one-third of the total full-time employees at the company's headquarters have been eliminated, effective immediately. The exact number was not given. The business is based at 1901 East Edwardsville Road in Wood River.

Salaries for certain ongoing positions also are being reduced.

"Like so many other companies that have had to make difficult and painful decisions in this highly uncertain economic environment, the board regrets the loss of these jobs," Williams said in a statement with the filing. "YTB has some wonderful employees, and these types of decisions are not taken lightly, nor are they taken without consideration of the impact on the lives and families of the employees whose positions have been eliminated. ... Unfortunately, the company needs to adjust its cost structure in keeping with ongoing weakness in its top line results."

The company estimates that the reduction in force and salaries will save approximately $2.4 million in operating costs.

Regarding the company's announcement in March of a potential merger with LTS Neutraceuticals, Inc., Lutzeier said: "The development of the company's restructuring program has consumed significant attention of the board and management in recent weeks. We felt it important to get our own house in better order first. We will be returning to our due diligence efforts and to an evaluation of the proposed transaction to determine whether it remains in the best interest of YTB's stockholders."

The company said it also expects to realize "other important efficiencies and cost reduction" through a review of non-personnel-related costs.

The company also will begin taking a more strategic approach to its business model, it said, by eliminating non-core products and services that are not producing a satisfactory return and exploring "new growth opportunities for leveraging its competitive advantages and large sales organization.

"By focusing simultaneously on cost-savings and growth opportunities, the board believes the company can be restructured, return to profitability in the future, and remain a viable force in the marketplace."

YTB also announced that the required audit of its full-year results for 2011 and the filing of its annual report for 2011 will not be done within the timeframes indicated by the company on April 16, nor will it be able to file its quarterly report for the first fiscal quarter of 2012 in a timely manner.

"As chair of the Audit Committee, I am keenly aware of the implications of the company's disclosure and reporting obligations," Lutzeier said. "The costs and burdens of being a public company are very significant for an organization such as YTB.

"As part of our restructuring program, we are studying alternatives that may lessen those costs and burdens," he said. "It is the goal of the board and the management team at YTB to serve the best long-term interests of the stockholders."

He said officials are striving to bring the company back into compliance with all reporting and disclosure requirements as soon as it is feasible.

In another management move, the company announced that Steven Boyd, 59, has been appointed as the company's principal financial and accounting officer. Boyd previously served as senior manager of finance and compensation for MEMC Electronic Materials Inc. from 2008 through earlier this year in 2012. Prior to that, Boyd was controller for YTB from 2006 through 2008.

Read more: http://www.thetelegraph.com/articles/ytb-70286-international-third.html#ixzz1vWTVaoXW