03-04-2008 Youbet.com faces delisting following record losses in 2007

NASDAQ Capital Market informed Youbet.com on Monday that it faces delisting if its share price fails to return to the minimum price of US$1 a share by September 29.

The warning follows a disastrous 2007 during which the betting provider lost US$27.3 million and saw its share price plummet to 72 cents – from US$3.50 last year. Describing the year as ‘challenging’,Youbet.com’s Interim Chief Executive Officer, Gary Sproule, reported fourth quarter losses of US$13.9 million to investors and analysts on Tuesday.

The losses included a US$9.9 million non-cash intangible asset impairment charge and the US$1.5 million seized by the federal government following an investigation into clients of International Racing Group, Youbet.com’s former offshore rebate shop which ceased trading operations in February.

Youbet will not face any charges as a result of the investigation but intends to replace customer assets seized by federal authorities. Jim Burk, the company’s Chief Financial Officer estimated this will total ‘a couple million dollars’.

Looking forward to a turnaround in 2008, CEO Gary Sproule said: "Over the last several months, we have made substantial progress in restructuring the company, including shedding non-core assets, streamlining operations, and reorganizing the senior management team."

Totalizator company United Tote could be sold as the company intends to focus on its core advance-deposit-wagering platform, Youbet Express.