In an open letter to shareholders, Youngevity International provided a business update, including more information about the reasons for the company’s delisting of its YGYI securities from the Nasdaq Stock Market on November 19, 2020 and its efforts to become relisted. The delisting, which occurred because of a non-compliance with filing requirements, was related to the company’s green coffee distribution business with a related party and isolated to Nicaraguan operations.
Youngevity has enlisted new auditors to complete requirements and become current on its financial reporting. The company anticipates a current reporting cadence to be in effect by July 15, 2021. Until the company is eligible for relisting with Nasdaq, its common stock is expected to be traded on the OTC Pink Market.
Youngevity operates in three distinct business segments—Direct Selling, Commercial Coffee and Commercial Hemp Segment. Although the company announced on March 12, 2020 that it had plans to consider the divestiture of its Direct Selling Segment, the company says it is currently committed to leveraging all three segments, but may revisit the discussion once it becomes current in its financial reporting.
All three business segments have been cutting costs like reducing staff and fixed overhead. Negative impacts on the cruise line industry caused a significant reduction for the company’s Commercial Coffee Segment, but private label and branded business increased. This segment faced revenue recognition challenges in 2019, resulting in delayed financial filings, but has $35 million in contracts for 2021.
The company is in the process of expanding its management team capabilities, and working to streamline its processes while improving company oversight and control measures.