YTB: modeFinance Credit Report

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modeFinance’s credit report.

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Basic:This report includes modeFinance TM

’ sMORE Credit Ratings and MORE CreditLimit to help you in the decision making.It covers all essential information includingfinancial statements of the last three yearsand descriptive information including tradedescription and sector analysis.This report type is ideally suited fordecisions on transactions with each levelof credit risk.

modeFinanceTM HeadquarterBuilding A - AREA Science ParkPadriciano 99 - 34149 Trieste - ItalyPh.: +39 040 375 5337Fax: +39 040 375 [email protected]

askMORETM is a registered mark of modeFinanceTM

YTB INTERNATIONAL, INC.Wednesday, 06 March 2013

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D C CC CCC B BB BBB A AA AAA

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D C CC CCC B BB BBB A AA AAAnot

available

non return extremlypathological

pathological highdanger

weak sufficient adequate good very

strongextremely

strong

Company name YTB INTERNATIONAL, INC.

Identification number Not available

Country United States of America

ZIP code and city 62095 - WOOD RIVER

Address 1901, EAST EDWARDSVILLE ROAD

+1 618 655 9477

www.ytb.com

[email protected]

Legal form Not available

Account Consolidated

Incorporation date 1982/06

NACE 2 Sector 7911 - Travel agency activities

Listed

Status Active

MORE Credit limit 490,000 e

31/12/2010 31/12/2009 31/12/2008

Turnover (th e) 27,221 46,731 114,575

Rating CCC CCC CCC

Probability of default 16.00% 16.00% 16.00%

Confidence Level 100% 100% 100%

Solvency ratios

Leverage ratio 3.16 1.92 1.84

Total asset/Total liabilities 1.32 1.52 1.54

Liquidity ratios

Current Ratio 0.34 0.60 0.63

Quick Ratio 0.33 0.59 0.58

Profitability and economic equili-

brium ratios

Return on investement ROI (%) -22.40 -34.79 -7.41

Return on equity ROE (%) -106.96 -132.98 -29.45

Asset turnover 2.32 3.11 3.70

Interest paid weight -0.09 -0.01 -0.02

Gross Profit/Operating revenue 0.48 0.49 0.39

Interest Coverage ratios

EBIT interest coverage ratio -10.80 -68.24 -44.39

Analysis and trend of financial

strength


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modeFinance TM srlVAT number [email protected]

Area Science Park,Padriciano 99. 34149 Trieste, ItalyTel. +39 040 3755337Fax +39 040 3756741

Sector Analysis

Company Healthy Balanced Vulnerable Risky

Solvency ratios

Leverage ratio 3.16 0.80 3.23 8.23 -3.18

Total asset/Total liabilities 1.32 2.25 1.31 1.08 0.93

Liquidity ratios

Current Ratio 0.34 2.00 1.19 1.01 0.77

Quick Ratio 0.33 1.95 1.17 0.98 0.76

Profitability and economic equilibrium ratios

Return on investement ROI (%) -22.40 18.94 5.90 0.91 -10.18

Return on equity ROE (%) -106.96 25.25 14.80 0.00 -102.10

Asset turnover 2.32 3.25 3.36 2.82 3.19

Interest paid weight -0.09 0.00 0.04 0.05 -0.04

Gross Profit/Operating revenue 0.48 0.35 0.17 0.12 0.12

Interest Coverage ratios

EBIT interest coverage ratio -10.80 2,123.00 16.50 0.80 -19.78

Cash Conversion Cycle (days)

Days Sales Of Inventory (DIO) 1 3 3 5 6

Days Sales Outstanding (DSO) 7 10 25 30 24

Days Payable Outstanding (DPO) 14 10 21 33 35

Cash Conversion Cycle (DIO + DSO - DPO) -6 14 9 11 2

Numer of analyzed companies - 269 1,118 599 201

(Average) Rating CCC A BB B CC

The sector has been chosen according to:

international companies in the sector NACE 2 7911 with financial data of year 2010.


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Sector Analysis - Graphs


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Balance Sheet

BALANCE SHEET (th e) 31/12/2010 31/12/2009 31/12/2008

Accounting practice Local GAAP Local GAAP Local GAAP

Exchange rate USD - EUR 0.748 0.6942 0.7185

Number of months 12 12 12

Total assets 11,709 15,005 30,959

Fixed assets 9,022 9,897 18,791

Intangible fixed assets 1,892 1,756 3,809

Tangible fixed assets 2,559 4,465 13,457

Other fixed assets 4,571 3,677 1,525

Current assets 2,688 5,108 12,169

Stocks 66 87 959

Debtors 524 468 1,926

Other current assets 2,098 4,553 9,284

Cash & cash equivalent 390 490 1,045

Shareholders funds 2,818 5,146 10,917

Capital 87 76 74

Other shareholders funds 2,732 5,069 10,843

Total liabilities 8,891 9,859 20,042

Non current liabilities 983 1,329 683

Long term debt - - -

Other non-current liabilities 983 1,329 683

Current liabilities 7,908 8,530 19,359

Loans - - -

Creditors 1,064 885 1,758

Other current liabilities 6,843 7,645 17,602

Total shareh. funds & liab. 11,709 15,005 30,959

NET DEBT (th e) 31/12/2010 31/12/2009 31/12/2008

Short term debts - - -

Long term debt - - -

Cash & cash equivalent 390 490 1,045

Net debt - - -

31/12/2010 31/12/2009 31/12/2008

Working capital -475 -330 1,127

Net Current Assets -5,220 -3,423 -7,190

31/12/2010 31/12/2009 31/12/2008

Days Sales Of Inventory (DIO) 1 1 3

Days Sales Outstanding (DSO) 7 4 6

Days Payable Outstanding (DPO) 14 7 6

Cash Conversion Cycle (DIO + DSO - DPO) -6 -2 3


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Income Statement

INCOME STATEMENT (th e) 31/12/2010 31/12/2009 31/12/2008

Accounting practice Local GAAP Local GAAP Local GAAP

Exchange rate USD - EUR 0.748 0.6942 0.7185

Number of months 12 12 12

Sales 27,112 46,548 112,925

Revenues growth (%) -42 -59 -

Other revenues +/- variation in inventories and contract in progress + Fixed assets

own construction capitalized109 183 1,651

Operating revenue / turnover 27,221 46,731 114,575

Total operating costs 29,911 52,054 116,972

Costs growth (%) -43 -55 -

Service costs - - -

Material costs - - -

Costs of employees - - -

EBITDA -756 2,082 1,995

Depreciation 1,934 7,405 4,392

EBIT -2,690 -5,323 -2,397

Financial P/L -182 25 49

Financial revenue 70 107 144

Financial expenses 252 82 96

Interest paid 249 78 54

P/L before tax -2,872 -5,298 -2,348

Extr. and other P/L -20 -2,137 -548

Extr. and other revenue - - -

Extr. and other expenses - - -

P/L before tax + Extr. and other P/L -2,892 -7,435 -2,896

Taxation 123 -592 320

P/L for period -3,014 -6,843 -3,215

31/12/2010 31/12/2009 31/12/2008

Costs of Good Sold 14,290 23,925 70,259

Gross Profit 12,931 22,806 44,316

Other Operating Expenses 15,621 28,129 46,713

31/12/2010 31/12/2009 31/12/2008

Cash flow -1,081 562 1,176

Added value - - -

31/12/2010 31/12/2009 31/12/2008

Number of employees 122 160 288


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Evolutions and trends


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Qualitative information

Full overview It operates as a travel company. It was incorporated in the year 1982 and it conducts its business from its head-

quarters in Wood River, Illinois. The company offers an interactive, real - time travel booking engine with access to

travel inventories with travel industry suppliers to its licensees and to small office and home office entrepreneurs

and independent travel agencies. It has two goals. The first idea is to become the world’s largest travel company.

The other, provide people with an opportunity to work from home, either full - time or part - time, and take control

of their own lifestyle. The company has thousands of people who own travel booking engines in the United States,

Bermuda, the Bahamas and Canada. It has been featured in the top 35 largest travel agencies in North America

for the last five years straight.

History Not available.

Primary business line Operates as a travel company.

Secondary business line Not available.

Main activity Services.

Secondary activity Not available.

Main products and services Travel services.

Size estimate Not available.

Strategy, organization and policy Not available.

Strategic alliances Not available.

Membership of a network Not available.

Main brand names Not available.

Main domestic country United States of America.

Main foreign countries or regions Bermuda, the Bahamas and Canada.

Main production sites Not available.

Main distribution sites Not available.

Main sales representation sites Not available.

Main customers Not available.


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Auditor/Advisor/Bank

name type address

MARCUM LLP Auditor -

Board

name date of birth nationality function

Mrs. Kim J Sorensen - - Vice Chairman of the Board, Treasurer, Secretary

Mr. Louis C Brock - - Director

Mr. Andrew Fletcher Cauthen 31/07/1943 - President, Chief Executive Officer, Director

Mr. Paul A Hemings - - Independent Director

Mr. Jack H Humes 1952 - Independent Director

Mr. Fred E Lutzeier - - Independent Director

Mr. Burt L Saunders - United States Independent Director; Board Member YTB International, Inc.

Mrs. Patricia S Williams - - Independent Director

Sharehoders (the first twenty shareholders ordered by Direct %)

Not available.

Subsidiaries (the first twenty subsidiaries ordered by Direct %)

YTB TRAVEL NETWORK, INC. Rating:

Country ISO code US Operating Revenue (MIL $) -

NACE Rev. 2, Core code - Total Assets (MIL $) -

Direct % WO Number of Employees -

Total % - Information date 2010/12

ZAMZUU, INC. Rating:

Country ISO code US Operating Revenue (MIL $) -


Direct % WO Number of Employees -



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ENFINITY TRAVEL LLC Rating:

Country ISO code US Operating Revenue (MIL $) .02


Direct % MO Number of Employees 3


YTB INTERNATIONAL, INC. Rating:

Country ISO code US Operating Revenue (MIL $) .62




YTB TRAVEL NETWORK OF ILLINOIS INC. Rating:

Country ISO code US Operating Revenue (MIL $) 15.2





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ASKMORE rating guide

General vision A credit rating is an opinion of the general creditworthiness of an obligor (issuer rating), or the creditworthiness of

an obligor in respect of a specific debt security, or other financial obligation (issue rating), based on relevant risk

factors.

The Multi Objective Rating Evaluation (MORE) model is essentially used to assess the level of distress of industrial

companies by using data included in financial statements.

The basic idea of the model is to analyze a set of financial and economic ratios in a predictive corporate bankruptcy

model with the purpose of creating a fundamental credit rating model for each industrial sector. Results of the

model are obtained by applying newly developed numerical methodologies, drawing together financial theory,

data mining and engineering design methodologies. The heart of MORE is a multi dimensional and multi objective

algorithm that produces a classification of each company, by taking into account any attributes (such as sector and

country) characterizing a firm.

The model gives the opportunity to assign a rating to a company even without considering a complete data analysis

and allows to process quality information. It induces a better understanding of a company’s strength and weakness

thanks to sophisticated data mining tools and taking into account the analyst knowledge.

The MORE rating vision is to look at the fundamental economics of the company. The main idea is to evaluate the

rating observing every aspect of the economical and financial behavior of the company: better is the equilibrium

between the different aspects, better will be the final rating.

This is done studying, evaluating and aggregating the most important sections of the financial and economic

behavior of a company such as: profitability, liquidity, solvency, interest coverage and efficiency.


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Rating scale

Rating class Rating macro class Assessment

AAA

Healthy

The company’s capacity to meet its financial commitments is extremely strong. The company shows an excellent

economic and financial flow and fund equilibrium.

AAThe company has very strong creditworthiness. It also has a good capital structure and economic and financial

equilibrium. Difference from AAA is slight.

AThe company has a high solvency. The company is however more susceptible to the adverse effects of changes in

circumstances and economic conditions than companies in higher rated categories.

BBB

Balanced

Capital structure and economic equilibrium are considered adequate. The company’s capacity to meet its financial

commitments could be affected by serious unfavourable events.

BBA company rated BB is more vulnerable than companies rated BBB. Furthermore the company faces major ongoing

uncertainties or exposure to adverse business, financial, or economic conditions.

B

Vulnerable

The company presents vulnerable signals with regards to its fundamentals. Adverse business, financial, or economic

conditions will be likely to impair the company’s capacity or willingness to meet its financial commitments.

CCC

A company rated CCC has a dangerous disequilibrium on the capital structure and on its economic and financial

fundamentals. Adverse market events and an inadequate management could affect with high probability the

company’s solvency.

CC

Risky

The company shows signals of high vulnerability. In the event of adverse market and economic conditions, the

company’s strong disequilibrium could increase.

CThe company shows considerable pathological situations. The company’s capacity to meet its financial

commitments is very low.

D The company has not any longer the capacity to meet its financial commitments.


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Fundamental Credit Rating Ratios

Analysis area Ratio Assessment

Solvency ratios

Leverage ratioThis measures the level of total liabilities of the company in comparison

with equity.

Assets to debtThis indicates company’s solvency. The company shows a level of deficit

when the value of this ratio is under one unit.

Financial ratios Fixed Assets coverage ratioThis is calculated only for holdings. It measures the capital structure i.e.

whether a company covers the fixed assets with long term capital.

Liquidity ratios

Current ratioThis measures whether a company has sufficient short-term assets to cover

its short-term liabilities.

Quick ratioThis compares current liabilities only to those assets that can be readily

turned into cash.

Profitability and economic ratios

Return on Investement(ROI)This measures the profitability of company investments without regard to

the way the investment is financed.

Return on Equity(ROE) This measures the profitability of the equity.

Asset turnover

This indicates the investments turnover with regards to sales. The level

assumed from the ratio depends on the sector in which the company

operates.

Profit margin This indicates the profitability of sales.

Interest coverage ratio Interest Paid coverage

This indicate the ability of the company to cover interest expenses through

the economic margins (Gross profit and EBIT) and through the cash flow

from operating activities.


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MORE Credit Limit, Probability of default and Confidence Level

MORE Credit Limit MORE Credit limit is the estimation of the amount of maximum credit that is possible to assign on a commercial

relationship with the analyzed company with an outlook of one year.

modeFinance used the following values associated with the company analyzed while computing the credit limit:

• Size;

• Years in Business;

• Average number of suppliers;

• Liquidity of the company and the comparison with its sector;

• The funds dedicated to be paid to suppliers;

• The likelihood that a company may pay its debts in the next 12 months (MORE Ratings).

The credit limit in this report is merely a suggested value of commercial credit limit calculated on the basis of annual

public data. This value should be reviewed by paying attention to the Confidence Level value and by using other

information such as other business information, news... etc; and private information such as the relationship with

client, history of payments, guarantees and the knowledge of the sector.

Probability of default e Confidence

Level

In addition to the MORE Rating, modeFinance also estimates the probability of default and provides a level of

confidence. The probability of default is the degree of certainty (in quantitative terms) that the company will go

into default.

As the probability of default is strongly affected by the economic climate that the company is operating in,

companies in the same MORE class will not necessarily have the same probability of default.

The MORE model can produce a MORE rating even if there is missing data by using an associated confidence level:

Confidence =

∑Available Information∑

Total Information

The level of confidence does not indicate financial confidence in the company. It is a reflection of the variations in

availability of financial data across Europe due to filing regulations and suggests the degree of financial detail the

MORE rating is able to take into account for each company.

For companies with fully populated records a confidence level of 100% would be applied: companies where no

financial data is provided, 0%. This puts the MORE rating in a context for the user and aids interpretation.


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Notes and disclaimer

NOTES modeFinance has based the present analysis on the company available financial statements, coming from one or

more of the following sources: local providers, Commercial Register (Companies House), websites, modeFinance’s

database etc.

DISCLAIMER All Rights Reserved. No part of this publication may be reproduced, stored in a retrieval system or transmitted in any

form by any means, electronic, mechanical, photocopying, recording or otherwise, without the prior permission of

the publisher modeFinance. The facts of this report are believed to be correct at the time of publication but cannot

be guaranteed. Please note that the findings, conclusions and recommendations that modeFinance delivers will

be based on information gathered in good faith from both primary and secondary sources, whose accuracy we

are not always in a position to guarantee. As such modeFinance can accept no liability whatever for actions taken

based on any information that may subsequently prove to be incorrect.

Contacts

Company modeFinance

Products MORE rating

Where AREA Science Park

34149 Trieste, via Padriciano 99 - ITALY

Info [email protected]

web www.modefinance.com

Phone +39 040 3755337

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YTB: modeFinance Credit Report

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