Good day, and welcome to the Energy Focus Quarterly Earnings Conference Call. As a reminder, today’s conference is being recorded. At this time, I’d like to turn the call over to Brion Tanous. Please go ahead.

Thank you, operator. I’d like to welcome everybody to Energy Focus’s fiscal 2012 third quarter earnings conference call. On this call the company’s Chief Executive Officer, Joe Kaveski will give a business update on the company’s solutions, products and government businesses as well as provide an outlook for the fourth quarter of 2012. The company’s Chief Financial Officer, Mark Plush will provide greater details surrounding the company’s third quarter financial results. We also have John Davenport and Eric Hilliard on the call with us this afternoon. Following prepared remarks we will open it up for questions for the remainder of this call. Before we get started I’m going to read a disclaimer about forward-looking statements, this conference may contain in addition to historical information forward-looking statements within the meaning of federal securities laws regarding Energy Focus. Forward-looking statements include statements about plans, objectives, goals, strategies, future events, and performance and underlying assumptions and other statements that different than historical facts. These forward-looking statements are based on current management expectations and are subject to risk and uncertainties that may result in expectations not being realized and may cause actual outcomes to differ materially from the expectations reflected in these forward-looking statements. Potential risks and uncertainties include change in demand for the company’s products, the impact of competition and government regulations and other risks contained in the statements filed from time to time with the SEC. All such forward-looking statements whether written or oral made on behalf of the company are expressly qualified by these cautionary statements. And such forward-looking statements are subject to risks and uncertainties and we caution you not to place undue reliance on these. With that I’d like to turn the call over to Mr. Joe Kaveski. Joe?

Thank you, Brion. And thank you, ladies and gentlemen for participating in Energy Focus’s third quarter earnings call. Today I’d like to offer you some brief comments concerning our third quarter financial performance, significant events that occurred in our third quarter and then provide you with some guidance for our fourth quarter and beyond. So, to begin. The company achieved 31% sales increase from the prior year but we missed our sales guidance of greater than $9.5 million to $10 million. This was primarily due to contract timing issues in SRC Solutions business. We anticipated receiving numerous contracts earlier in the third quarter that were delayed to the end of the quarter and into November. However, the company did have many positive events and accomplishments that occurred in our third quarter that are worth discussing. Specifically we did secure $6.9 million in new solutions contracts beginning at the end of the third quarter and through today. Furthermore we increased our solutions sales pipeline by more than 50% since the beginning of the year, this increase is the direct results of SRC’s new leadership and the SRC team’s intensified effort to increase our customer base, expand our geographic coverage and increase our customer value through the inclusion of EFOI LED lighting product. Because of our increasingly robust pipeline we feel confident that we will secure additional contracts in our fourth quarter and see significant growth in 2013. Also our product segment is growing and growing profitably. For the 9 months, our product segment income increased $1.8 million compared to a loss last year. We believe that this is a direct result of increasing market acceptance for EFOI’s LED product and higher EFOI pool LED sales driven by increasing market share. For example, when comparing the first 9 months of this year to all of last year, our relatively new LED retrofit kit sales are up over 250% and our generation one multiple LED tube lamp unit sales are up over 5,000%. Last quarter we started selling a new and improved version of our Generation 1 multiple LED tube lamp. This new lamp is 10% more efficient than our previous lamp, is more durable, lighter weight and provides more value to our customers. We have already received the sizable order for this new lamp which we anticipate fulfilling in our fourth quarter. In addition, Energy Focus has received $950,000 in new contracts to further development of our IntelliTube technology. This contract will increase the product breadth of our offerings in our government products business and further CRICKET which is our wireless control product designed to increase the value of IntelliTube. As for our U.S. Navy products segment sales the company shipped a major LED product order in our third quarter. Furthermore, the company has identified a viable alternate path to buy accelerated amount of our MIL-SPEC qualified products were obtained for the products out of the significant energy and cost savings that they create. If successful, the company should see dramatic increases above our existing contract in Navy sales during 2013. Even if were not able to get this new path in place, the company expects to realize increasing Navy sales because of the Navy’s strong commitment to relighting the fleet with EFOI’s energy efficient LED product. These sales will be generated for our existing $23 million contract as well as contracts received. Finally, the development of IntelliTube for commercial buildings has progressed nicely over the last quarter. The commercial version of IntelliTube is a superior LED replacement for linear fluorescent lamps, because of its economic value proposition, higher energy efficiency and improved esthetic performance, all due to our proprietary optical waveguide technology. Over the last quarter, the company has made significant improvements in regard to its optical design and energy efficiency. As I stated in our last call, we expect to launch the commercial version of IntelliTube in the first half of 2013. Now as to our financial outlook for the fourth quarter, the company expects revenues between $9 million and $10.5 million, a 50% to 70% sales increase over last year’s fourth quarter. As for 2013, because of our growth in LED product sales and SRC’s increasing sales pipeline the company anticipates continued sales growth with improving gross margin. We will provide you further guidance during our first quarter earnings call. So, in conclusion, I remain optimistic about Energy Focus. Our Products business is now growing profitably as we are seeing increased acceptance and sales of our LED lighting product, which should only accelerate with the introduction of a new series of LED products in the fourth quarter and IntelliTube for commercial buildings coming online in 2013. There is no doubt that SRC’s performances improving is evidenced by our recently-announced contracts and a growing sales proposal pipeline and recent request for new proposals associated with the presidential memorandum for over $2 billion of new energy savings contracts signed by the end of 2013. And finally, we are encouraged by the acceptance of our MIL-SPEC qualified Navy product. Furthermore, we believe the positive remarks made in October by Secretary Mavis [ph] and Rear Admiral Shannon [ph] were only lead to higher navy sales in 2013. So, at this time I’d like to turn the call over to Mark Plush, our Chief Financial Officer, for further detail on our third quarter financial results. Mark?

Thank you, Joe, good afternoon, everyone. Net sales of $7.9 million for the third quarter of 2012 increased $1.9 million or 31% compared to with the prior year’s third quarter sales of $6 million. The increase in sales was due primarily to a $1 million of higher pool and commercial sales to $774,000 of higher government products and R&D services revenue. We recorded appropriate $1.3 million of sales for U.S. Navy products during the quarter. Gross margins were 24.8% of net sales versus last year’s third quarter gross margins of 20.1% of net sales, a 4.7 percentage point increase or $744,000. The increase in gross margins was due primarily to higher gross margins in our products business which was 26.8% of net sales compared to 22% last year. Additionally, the solutions business gross margins improved to 19.1% of net sales from 16.3% last year. Operating expenses for the third quarter of 2012 were $2.7 million compared to the prior year’s $2.5 million due entirely to higher R&D expenses. Net R&D expenses increased $380,000 for the third quarter compared to the prior year due to lower cost recovery credits. Sales and marketing expenses and G&A cost increased to $100,000 in the prior year. The third quarter’s loss before taxes was $926,000 compared to a loss before taxes of $1.5 million in the prior year’s third quarter, this reflex in improvement of $529,000 due to higher sales and gross margins offset somewhat by higher R&D expenses. The 9-month period ended September 30, 2012 net sales were $20.9 million compared to $19.7 million for the last year’s comparable period a $1.2 million or 6% increase. The increase in sales was a result of $3.3 million higher sales from our product segment partially offset by $2.1 million of lower sales from our SRC Solutions business. We recorded revenue of approximately $2.3 million for the 9-month period related to the U.S. Navy contract. Gross margins increased $526,000 compared to the prior year and improved to 21.3% of net sales from 19.9% in the 9 month period last year. Operating expenses for the 9 month period ended September 30, 2012 were $7.7 million compared to prior year’s comparable period of $8.8 million, a decrease of $1.2 million or 13% primarily due to lower sales and marketing expenses. The decrease in sales and marketing expenses was due to lower salaries and benefits, lower commissions and lower discretionary spending. Additionally, G&A expenses decreased $355,000 primarily due to lower amortization expense and legal fees. This was partially offset by an increase in R&D expenses of $231,000 due to lower cost recovery credits. A loss before taxes for the 9 month period ended September 30, 2012 was $3.7 million compared to $5.4 million in the prior year’s comparable period, a $1.7 million improvement and $1.2 million of higher sales. The improvement was a result of $1.2 million of lower operating costs and $526,000 of higher gross margins resulting from higher sales. Cash at September 30, 2012 was $380,000 versus $2.1 million at December 31, 2011. The decrease in cash was due to cash used for operating purposes including a $1.7 million decrease in accounts payable and accrued liabilities. For the quarter we generated cash from operations amounting to $560,000 as net losses were more than offset by decreases in working capital. Inventory turns at September 30, 2012 were 10.1 turns, the same as June 30, 2012 and up from 6.2 turns from September 30, 2011. Days sales outstanding was 49 days at September 30, 2012, down 9 days from both June 30, 2012 and the prior year’s September 30 quarter. As Joe mentioned, the fourth quarter sales guidance of $9 million to $10.5 million reflects projected sales increase in our SRC Solutions business. Now I will turn the call back to Robert for questions.

[Operator Instructions] And we will take our first question from private investor, Bill Hardy [ph].

I’m looking at the forecast for the 4-foot IntelliTube commercialized version coming out. I think in your comments on the second quarter you indicated that was going to be late fourth quarter of this year or early first quarter of next year. Now you are kind of hedging a little bit saying it's going to be first half of next year. I guess there is trouble with the development of the LED to power that tube? Is that correct?

Absolutely not. There is no problem with the development. And Bill, as I recall I said the latter part of 2012 was the first half of 2013. And really what it amounts to right now is that this product we will utilize a contract manufacturer. We right now are interviewing multiple contract manufacturers to make sure that they can deliver on the quality standard that we set out as well as basically interviewing channel partners that can help us introduce this into the marketplace. We absolutely want to so it’s right and that’s why we basically have begged off on the delivery in the latter part of 2012 and we are looking to the first half of 2013.

So, I mean the LED then has been developed and has been proven in, and it works on 4 feet as well as 2-foot version.

Absolutely, and Bill, I might reiterate what I mentioned in my kind of prologue and that is, is that we got this base covered. Because the original multiple LED product that we have been selling into the marketplace has done quite well. However, we introduced an improved version of that light that we actually will be shipping on this quarter which is a significant improvement over the first one. It by itself represents what we believe to be the highest performance, lowest cost solution on a market available today. So, we feel good about the product line and we feel good about the delivery of IntelliTube to the commercial markets in the first half of 2013 and launching it in the right way with the right suppliers.

Would you mind commenting on what the cost differential might be or cost improvement might be as a percent of the present or the forecasted improvement of the multiple LED 2?

That I’d like to just hold off until the introduction.

Okay. All right. But it is going to be cost improvement?

We believe it is, absolutely.

[Operator Instructions] We go next to Peter Field of Merryfield Investment Management.

In the last call you were predicting EBITDA positive by the second half of this year and I would guess that’s not the case. So, can you tell me when you think you will be EBITDA positive? And with respect to that is the dwindling amount of cash on the balance sheet sufficient to get you through to that point or we have to do more raising of capital?

On EBITDA positive, what we are looking at is on the higher end of the sales range we will be close, it really depends upon a product mix and gross margins. So, that’s the question on the EBITDA. In terms of the cash situation, when you look at the Q, you will see that we have $1.3 million outstanding on a $4.5 million credit facility, clearly we can always use more capital and we are looking at ways to utilization more of the existing facility that we have.

I don't know if you had time to listen to the President speak this afternoon, but I did. Although I’m sorry I did because I’m convinced more than ever now with his stance that we will probably not have a resolution to the fiscal cliff before the end of the year. Now that’s sheer speculation on my part of course. But take a worst case scenario and tell me if we just sail right over this fiscal cliff and when automatic spending cuts kick in, in January, what effect, if any, would that have on your Navy sales?

Peter, we have actually been working on an alternate approach that we believe at this moment in time would really help overcome that issue. The government has basically used it many, many times before. Certainly, our products qualify for them and the basic concept is, is that they can pay for our products out of savings that are created. In that particular case, it's not a matter of do they have the money in the budget. They do. And so the net impact though is, if accepted, it would absolutely accelerate procurement of our products. So, having said that we are working it hard, we are very, very optimistic to that. the Navy will move forward with this alternate approach and what I’d share with you is or remind us all is that although we wouldn’t obviously be wild about the fiscal cliff, the Administration and the top executives or top brass at the Navy haven’t changed and they are 100% committed to the green fleet. Our particular technology actually saves a boat load of money out of the Navy’s energy spend and so anything can change but we think that there is more than one way to skin a cat and in fact we found 2. And we are very optimistic. We are going to see the growth that we anticipate 2013.

We will take a question from private investor, Ted Brown [ph].

As Peter was talking about the very low reserves of cash. And I’m worried that you’ll run and sell another bunch of stock and I think there are too many outstanding already. So, can you kind of assure me that you are not going to run out and print some more stock against whatever?

As I mentioned before and I mentioned on a previous conference call, our cash balance is low because we only borrow what we need under the credit facility and in fact at the end of June our cash balance was about $600,000 and at the end of this quarter was about $400,000. I also mentioned that we have $1.3 million outstanding on a $4.5 million credit facility. So, clearly what we are trying to do is to get the needed capital that we have through our existing debt facility or really through debt.

From my Navy experience, I know that lot of stuff that goes to sea doesn’t really stand up. Are you assuring us that the equipment you are installing has been approved by service and is A1?

Certainly. This is John. We have been on Navy ships since 2005 and with products beginning with the Berth light and LED globes and we are on I think 18 or 19 vessels as of today and it’s growing. And as far as I know we haven’t had a single failure at sea, so I think that’s pretty good. We are meeting MIL-SPEC and believe me, you would lose the fillings in your teeth if you stood by and watched what the hammered -- it's amazing the kind of test these things have to survive.

One more thing. Jim Cramer, the character on CNBC that talks all the time about the market. Well Jim Cramer couple of times said that a $0.20 stock isn’t worth a damn, and that the people ought to do something about it or go out with business. Now you’ve been terrifying me, was the stock around $0.20 and no reports to give us some kind of hope that you are still alive. You use to do that on a more regular basis about, talking about business generated and so forth. And are you aware that you really haven’t been fulfilling that area for 6 months anyway?

I don't know how to necessarily respond to that. [indiscernible] Say that there are some very large successful companies today that started with very low – as low penny stocks. So, that would be the only thing I can comment on there. Having said that, we recognized that the best way to drive our stock price is through increasing financial performance and I can assure you we were keenly focused on doing just that. So I guess the proof will be in the pudding for Mr. Cramer shortly.

And this does conclude our Q&A session. I will turn the call back to our moderators for closing remarks.

Thank you, operator and again thanks to all of our investors and associates that have listened in our call today. As I iterated I’m extremely excited about Energy Focus and I think for a variety of very, very solid reasons that will become evident here as we move forward. So, with that I’d like to thank you again. I look forward to visiting with you again in our fourth quarter earnings call and wish everyone a good night.

And this does conclude today’s conference call, once again we would like to thank everyone for your participation and have a wonderful day.