At the end of the first quarter, XShares Group LLC's Chief Executive William Henson took an extended leave of absence after less than five months on the job.

While it won't give the reasons behind his move, the exchange-traded funds provider says it has no plans to replace him. Company officials also point out that Anthony Dudzinski, an original co-founder and the group president, remains.

The XShares franchise, which started in 2006, is actually made-up of several parts. The biggest and most significant operation under its umbrella is XShares Advisors. The unit develops and runs the three families of ETFs that represent the overriding bulk of the firm's $250 million in assets under management.

The 45-year-old Dudzinski also serves as chief executive of XShares Advisors. IndexUniverse sat down with him on Thursday for a closer look at the XShares ETF presence. A 25-year veteran in market making and securities trading, he helped get XShares out of the corporate gates in 2006 and helped lead the launch of its 31 ETFs last year.

IndexUniverse.com (IU): Why did the chief executive of XShares' holding company quit?

Anthony Dudzinski (Dudzinski): He didn't quit, he took an extended leave at the end of the first quarter. We aren't naming a replacement for him and we're not planning to in the immediate future. But that's all I can say right now. It's a personnel matter.

IU: What sort of financial shape is XShares in at the moment?

Dudzinski: XShares is unchanged and in healthy shape right now. We have sufficient capital to meet our needs for the foreseeable future. We aren't currently profitable, but as a young entrepreneurial business, there is a ramp-up period. We are on track in the ramp-up period for profitability. We are continuing to innovate and create new products. But there are a lot of market forces that can have an impact on that timetable. So to pin it down to a specific date probably isn't worthwhile. But I can say we're a little over two years old and we're continuing to track our business plan as originally envisioned.

IU: Most of your funds are very small in terms of assets, aren't they?

Dudzinski: That is correct. All of our ETFs launched last year when the market was down. So that means they opened with a little less in assets. That's especially true with the Adelante family of real estate ETFs. But you've got to take a long-term approach in this business. And we do have sufficient capital. So we're really focusing on executing our business plan. That includes spreading the message of XShares and how they fit into the market.

IU: What are the break-even points for your ETFs to become profitable?

Dudzinski: There are many. The first one has to do with the relationships with your vendors and how you manage costs. Associated with that are custody, administration and related expenses. The true measure of profitability comes from matching up those costs over time. So in the early going with new funds, you tend to enjoy better discounts from your vendors - they want to see you prosper and survive. But you can't carve out a single number in terms of an asset level to get to. From that point of view, we're managing our costs very well and managing our business well.

IU: You're not up for sale then?

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