Youbet: Restructuring Plan in Place said it has put a restructuring plan in place. said April 1 it had put a restructuring plan in place to recover from last year's $27.4-million loss, and is looking forward to a turnaround in 2008.

Speaking with analysts during a conference call about 2007 year-end and fourth-quarter financials released March 31, executives with the advance deposit wagering company reemphasized that 2007 was “challenging” in many respects. The annual loss, which was precipitated by $24.1 million in one-time impairments in the fourth quarter alone, was the largest in company history.

Interim chief executive officer Gary W. Sproule said the company will focus on its core product, the ADW Internet platform Youbet Express, after a year in which it closed troubled offshore wagering entity International Racing Group. The IRG business was responsible for a $9.9-million write-off in the fourth quarter, as well as at least $2.5 million in losses due to the federal investigation that helped bring about its demise.

“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,” said Sproule, who took over for Charles Champion last November. “I would like to remind everyone that our efforts to reposition Youbet are still a work in progress. Although we have accomplished much in the last several months, we are hopeful to further improve the Youbet Express platform.”

Sproule said cost-cutting initiatives, such as the possible sale of its struggling United Tote business unit, will hopefully get back to margins when it was an Internet-only business.

“We will keep a keen eye on our balance sheet,” he said. “We are making our ADW platform competitive. We feel that 2008 will be a key turnaround year for Youbet, and we look forward to getting back to basics, and providing long-term value for our shareholders.”

Shares of traded in the $20 range toward the end of the boom of the late 1990s, but have declined since, and currently are trading under $1.

One analyst asked about the payback of $1.5 million in seized funds to IRG customers, an unknown number of which are allegedly part of the ongoing investigation by the U.S. Attorney’s Office in Las Vegas.

“My concern is: Will you have to pay out a million-and-half bucks to customers whose assets were seized?” asked Mark Argento of Craig-Hallum Capital.

“It’s our intent to pay out any remaining customer balance as long as it’s cleared by the U.S. Attorney’s Office, as part of our cooperation with them,” Sproule said of an agreement reached with the agency during the investigation. chief financial officer Jim Burk said the company had enough in restricted funds to cover all of the payouts, and estimated the remaining amount owed to IRG customers from account activity to be about “a couple million dollars.” Burk also said a final earn-out payment due to the former owners of IRG by Aug. 31 was unresolved. reported it had $3.2 million accrued for the final payment.

“Until those matters are resolved, we won’t know the status of those payments,” said Burk, referencing the federal investigation.

Discounting its lost handle attributed to the shuttering of IRG, was able to grow its handle on Youbet Express 4.4% to $484.2 million despite the loss of significant wagering content when TrackNet Media Group was formed in March 2007. And the company’s yield on those wagers improved 1.1% to 7.2%.

“We were able to offset the loss of their handle with higher-yielding handle,” Sproule said of lost content from Churchill Downs Inc. and Magna Entertainment Corp. In answer to an analyst’s question, Sproule said has had conversations with TrackNet Media Group, but he did not elaborate.