Landon Barretto – Barretto Pacific Corporation William J. Clough – President and Chief Executive Officer Daniel N. Ford – Chief Financial Officer

Eric A. Stine – Craig-Hallum Capital Group LLC Noel Atkinson – Loewen, Ondaatje, McCutcheon Limited Joel W. Achramowicz – Merriman Capital, Inc. Morgan Frank – Manchester Capital Management LLC Jim G. Kennedy – Marathon Capital Management LLC David L. Lavigne – Accredited Members, Inc.

Greetings, and welcome to the CUI 2013 Second Quarter Earnings Conference Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. (Operator Instructions) As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Landon Barretto. Thank you sir, you may now begin.

Thank you, good morning. Thank you for joining us to review the financial results of CUI Global Inc. for the second quarter of fiscal year 2013 which ended June 30, 2013. As a conference call operator indicated my name is Landon Barretto with Barretto Pacific Corporation. We are the investor relations consulting firm for the company. With us on the call representing the company today are Bill Clough, President, and Chief Executive Officer, and Dan Ford, Chief Financial Officer. At the conclusion of today’s prepared remarks, we will open the call for question-and-answer session. If anyone participating on today’s call does not have a full pack copy of the earnings release, you can retrieve it from the company’s website at www.cuiglobal.com. Before we begin with the prepared remarks, we submit for the record the following statement. Statements made by the management team of CUI Global during the course of this conference call that are not historical facts are considered to be forward-looking statements subject to risk and uncertainty. The Private Securities Litigation Reform Act of 1995 provides the Safe Harbor for such forward looking statements. The words, belief, expect, anticipate, estimate, will, and other similar statements of expectations identify forward-looking statements. The forward looking statements contained herein are subject to certain risks, uncertainties and important factors that could cause actual results to differ materially from those reflected in the forward-looking statements included herein. These risks and uncertainties include, but are not limited to the impact of competitive product and pricing, product demand and market acceptance, new product development, the ability of the Company to control costs, availability of products produced from third-party vendors, fluctuations in operating results and other risks detailed from time-to-time in the CUI Global filings with the U.S. Securities and Exchange Commission. Participants on this call are cautioned not to place undue reliance on these forward-looking statements, which reflect management’s analysis only as of the date hereof. The Company undertakes no obligation to publicly release the results of any revision to these forward-looking statements, which may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. With that said, let me turn the call over to Bill Clough, President and Chief Executive Officer of CUI. Bill? William J. Clough: Thank you, Landon and thank you everybody for attending. This is quite an exciting time period for the Company, for Dan and myself, and I think for everybody who is involved in this company. Dan and I, when we went out and talked originally about the acquisition of Orbital, we’ve talked about that it would be immediately accretive, in fact we promised that it would be immediately accretive, and I think we delivered quite handsomely on that promise. I’m going to turn it over to Dan in a few minutes and have him go through the numbers in much more detail, but just a top line looking at it. The quarter revenues were up 80%, year-to-date revenues are up almost 80% and it’s not just Orbital, Matt and his team at CUI have done an incredible job this year of really, really growing the business up almost $4 million, up 20% year-to-date, so really, really nice action by CUI as well, and we’ll talk more about that when we talk about operation. We’ve done that by – and in conjunction with that reduced our SG&A as a total percentage of our gross revenues from 43% down to 36%, and as Dan will explain that when he takes over a lot of that SG&A, has to do with amortization of intangibles. So it really a non-cash items that we were kind of forced to accrue, because of the GAAP accounting rules. So again really, really nice in that regard as well. We managed to maintain close to 40% gross margins, just under 40% gross margin even including Orbital. So, again both companies hitting really nice margins. As far as the EBITDA is concerned, up quarter-over-quarter from a loss of $0.04 last quarter, up to a EPS of adjusted $0.08 this quarter, a $0.12 improvement. And year-to-date up from a loss of $0.12 last year, up to again $0.10 this year or up $0.22. So, again overall some really nice numbers, I believe and I think as we’ve talked about in the past this was a inflection quarter. This last quarter was an inflection quarter for CUI Global. We have now crossed that profitability threshold. We think that we have some really, really exciting things going now that are going to really increase the value of this company as we move forward. I’m going to turn over to Dan. Let him go through the details of the numbers and then come back and talk a little bit about our operational update. I’ll give you some idea of where we are at and where are we going. So with that Dan, you want to take it away? Daniel N. Ford: Thank you, Bill. Good morning everyone and also thank you for attending this morning. First things I want to touch on in some of the lead transactions for the quarter, and that obviously starts with the equity rates. We issued 9.6 million shares roughly, 9.6 million to 9.7 million shares and net proceeds of $45.1 million, a dramatic change to our balance sheet right off the gate. That allowed us to repay $2 million of principal loans as long-term net payables, that was extended to May 15, 2020 due date, and the interest rate was reduced to 5% per year. Bigger than that there was obviously the acquisition of Orbital Gas Systems for $26.2 million. With that acquisition, we obviously got the balance sheet related asset. We also identified through the purchase price allocation, the intangible assets that came with that and goodwill, verified intangibles, with amortization life through from anywhere from two years to 12 years of that, and goodwill of $5 million. The amortization of that intangible and those intangible items contributed to the Q, $730,000 of expense roughly, which hit SG&A directly again that is non-cash expense and it was $730,000 of the SG&A total. Which in that though is one of those amortizing intangible have the two year life, that's the most expensive for the quarter, and that contributed $429,000 of expense for the Q, that will be completed after two years so in April 2015 that will have fully amortized out. From there I just thought I would talk thorough the financial statements and some of the key items. The balance sheet obviously has a strong cash position now, from the equity raised after paying the pre-acquisition and the debt repayment, we have cash of $28.1 million. We’ve repaid the line of credit loans, it has a zero balance as of June 30, and we continue to maintaining that line of credit of $4 million with Wells Fargo. Current assets of $44.5 million, total assets of $89.9 million, current liability of $14.6 million, and total liabilities of $19.95 million. So we have a very strong asset position compared to liabilities very healthy balance sheet. Moving on to the P&L; our quarter two revenue was $18,151,000 the year-to-date revenue was $28.2 million, of the quarter two revenue approximately $12.6 million related to the CUI power and electro-mechanical component products and $5.6 million related to gas industry products. Year-to-date figures $22.25 million related to the CUI electro-mechanical and power products and $5.95 million related to gas related products. As Bill mentioned earlier CUI’s revenues was an increase of nearly $4 million, it was actually $3.7 million increase for the six-month comparative period. Orbital contribution to the increased revenue for the year-to-date period was $5.6 million roughly as previously discussed. The increase from CUI is largely related to product introductions, continuing market penetrations by the sales and marketing efforts, several new and existing customer engagements that have added new orders, the addition of Future Electronics, which is discussed in Q1 as well, but continues to perform better than expected. The increased backlog began in 2012 and has actually continued through the six months ended for CUI customer received is up $2.2 million as compared to the prior year six months ended CUI. That’s a 10% increase. Bill mentioned earlier that the gross profit margins remain consistent. They were at 38.93% as compared to 39.27%, and that’s consistent even after adding the acquisition of Orbital kind of demonstrating their business model is very similar to CUI as it was before. SG&A, this one I know everyone asked about. So I want to talk through this obviously. SG&A increased $2.5 million roughly for the year-to-date period. Of that increase Orbital accounted for $1.9 million, but as a percentage of sales it actually improved in the quarter and year-to-date periods compared to the prior comparative periods, and it did include that $731,000 of amortization expense related to the intangibles. As a percentage of revenues it was 34.6% during the quarter compared to 39.3% the prior year, an improvement of nearly 5%. And for the year-to-date period it was approximately 36.9%, compared to 43%, which is a 6% improvement. That associated with the increased sales of CUI and the efficiencies gained through that as well as the addition of Orbital and their ability to focus the GasPT sales efforts. There is one other significant addition to SG&A out of any intangibles, and the ongoing activities at Orbital, and that just acquisition related expenses, totaled approximately $240,000 now it’s everything from legal fees and filings and professional services, financial services, and so on. An item you may notice on the P&L is the provision for taxes have increased. That provision is largely related to the UK activities, as the U.S. we have a net carry forward losses to allocate against income quite in the UK we are taxable and the amortization of intangibles does not affect the tax rate. The Q2 net income was $294,778 for an EPS of $0.02 that improved the year-to-date income to loss of $167,000 roughly, which was like Q1, it was $452,000 loss. The year-to-date EPS is $0.01 loss. As Bill mentioned previously the improvement of the EBITDA, but the EBITDA total for the quarter was $1,575,098 as compared to a loss of approximately $418,000 prior year, and nearly $2 million improvement. And for the year-to-date period, the EBITDA is approximately $1.5 million as compared to the loss of $1.1 million in the prior year, dramatic improvement there as well. In the Q, we present the pro forma results. As though Orbital had been acquired January 1, 2013 and in 2012, that pro forma shows that had we acquired them at the start of the year, we would have generated a $32.8 million roughly in revenue, compared to $31.5 million in the prior year pro forma period. And generated a net loss of $1.7 million compared to $1.9 million. Both of those comparative periods include the amortization of those intangible previously mentioned in the pro forma statement that presents approximately $1.5 million of amortizing expense. Additionally, in the 2013 period, there was a large bonus granted at Orbital by the former owner during the period that he owned the company at the start of this year, and that approximately $1.5 million of expense. So taking that into account as well as the amortization of intangibles, that net loss for the current year would have been dramatically different, but not taking those accounts, that bonus I should mention also is a one-time event and will not be hitting again going forward. The cash flow statement, there is net-cash provided by operating activities for the period ended, $602,701 as compared to $751,000 roughly used in the prior year. And that improvement is associated with net income for Q2 as well as the couple of key items, a large collection of receivables at Orbital, from a one single customer of approximately $2 million, offset by some increases in inventory related customer order schedules, increased prepaid expenses, payments on accounts payable, and a large payment of Orbital related liability that existed prior to the acquisition of about $1.5 million, and payments in value added taxes and a few other key items, but those are the main ones. Also, note that we repaid $2 million in long-term debt and the line of credit this year-to-date period, the overall increase in cash position is $25.1 million approximately for the year-to-date. The statement reporting is included, we now are showing three segments, which include power and electro-mechanical, which is really the CUI Inc. and CUI Japan product lines, and then a gas segment, which represents the activities in Orbital including GasPT, and there is another segment, which combines all of the other activities that are operating as individual segment. The power and electro-mechanical for the year-to-date contributed $22.25 million and the gas revenue contributed $5.95 million in revenue. With that I will turn it back over to Bill to discuss more of the operating activities of the company. Thank you. William J. Clough: Thank you, Dan. Appreciate it. Again I think, let me start with CUI and CUI as we’ve talked about in the past, is really doing well, quite frankly well run by Matt and his team. They’ve sort out and really aggressively attacked new markets consistently. As Dan mentioned, the Future Electronics relationship that they put together has turned out to be much better than any of us thought it would be. Future has introduced us to OEMs that we would never have seen before and quite frankly they are not only excited about the core business products that we’re providing them, but are looking forward to distributing our Novum products as well. The Ericsson partnership continues to move forward very positively. We’ve introduced more SKUs and have Novum products after testing. And as Dan mentioned, we have a historically high backlog in CUI of $14.6 million. So, really, really nice work by Matt and his crew. I can only say the same thing for Andy Ridge at Orbital. I’ve now spend significant time at Orbital and I can tell you and I have told some people already that the management team, especially the new management team at Orbital is much deeper, much stronger, much better frankly than I even imagined. Really, really great team there, very enthusiastic. We’ve had a historic increase in contractual work. Again looking at the backlogs, Orbital has a historic backlog right now of $23.6 million. So roughly one year’s of revenues in backlog, which is really nice for us to have. For a total backlog for the two companies, about $38.2 million, almost $40 million in backlog, it’s showing us some pretty dynamic sales in the next quarter as we begin to deliver on that. Breaking out the new technologies at Orbital, I really want to talk about all three technologies because I know that everyone has a great deal of interest in GasPT and obviously that’s where a lot of our efforts are. But we’re no longer a one trick pony here when it comes to gas. The acquisition of Orbital has given us much, much wider, much broader product line and I think many of you probably saw the press release, for example, on the VE-Probe, which really expands our market in that regard. : The initial contract of 60 units has about 15 more to go and we have been informed by National Grid that they will probably be letting out a small contract of 25 to 30 more units to give them the time to offer a tender for as many as 200 units. Of those units, again to remind you to sales were about £100,000 a piece, about $150,000 and have a great margin associated with them. So IRIS is quite exciting and moving forward. I mentioned the VE-Probe. During the last several weeks we were able to acquire worldwide exclusive rights to the VE-Probe in all the generation. So we did have exclusive rights to the VE-Probe and its use with GasPT, but now we have that Probe technology in any of the generations, which means we can sell it as sampling systems for everything from mercury, sensors to GCs to any number of different applications. And most exciting of all, we can now really penetrate the market with the VE-Probe into thermal wells, which are really ubiquitous in the systems throughout the world. They are in essence temperature sensors that are placed throughout the pipelines, hundreds of thousands of them and the VE-Probe technology allows the operators to put those probes in and not worry about the vibration and fracturing that they get with standard technology. So again, we think that’s going to be a huge market for us. And then, again, GasPT. As many of you know, we’ve talked about in the past. With the acquisition of Orbital we’ve changed our philosophy and strategy with GasPT. We identified originally once we took control of Orbital. The top [S-1] of distributors that we felt we could get to sell the product into the market, these are distributors who are all build with networks, selling metering devices into the natural gas industry. And we targeted, we looked originally at 400 of those potential distributors, call that down to what we thought was the top 35 to 40 of those distributors, and about two months now started really attacking those distributors and looking for contracts to then to distribute the product. I will tell you that we now have 14 contracts either signed or out for signature. We expect that as many as 29 distributors signed up by the end of September and we’re well on our way to hitting the number that we hoped for, which is 35 to 40 distributors by year-end. We believe that that’s the way that we’re going to get significant traction with the device and really bring it into the market. I will tell you that myself, my team, Andy and his team have been out traveling around and the feedback has been remarkably positive both in pricing and in what the device could do. We expect to meet the numbers that are out there this year, but we expect again to see those numbers increase as these distributors come on board. We had approximately 50 of the units sold and installed as of the end of June. That would include the two test devices for GE. They expect to do secondary testing in October. We are getting an order for eight of the devices from National Grid that they are going to use specifically for engine controls on some of their larger turbine compressors. So again quite a great use for the device. And we’ve now installed two and have two more going out to Alliance pipeline for installation on their North American pipeline. So again, starting to get traction and they’re really pushing towards the distributor shift. So all in all, when I look at both companies; CUI and Matt’s team and Orbital and Andy’s team, they’re hitting on all eight cylinders. We have some very exciting things coming forward, and again I think this is, as I’ve mentioned that have mentioned repeatedly, was an inflection for this company, and I think we’re going to see some great growth in the future, and again, in all of these products lines. So, with that being said, Landon and I would open it up for questions.

Thank you. We’ll now be conducting a question-and-answer session. (Operator Instructions) Our first question comes from Eric Stine from Craig-Hallum. Eric A. Stine – Craig-Hallum Capital Group LLC: Hi, Bill and Dan, thanks for taking the questions. William J. Clough: Sure. Eric A. Stine – Craig-Hallum Capital Group LLC: Maybe we can start with backlog. Just where the backlog currently stands for the GasPTi, and then also last quarter you’ve talked about kind of a list of firm indications. I think the number was approximately 95, just maybe where that stands, and how that breaks down amongst the different opportunities? William J. Clough: I think that still stands where it was last quarter. We have very good indications that we’re going to be meet those numbers. We’ve delivered on some. Others we’re waiting for purchase orders. But again, I think as we’ve talked about last quarter, we have now a sales team of five sales guys, who are assigned to this and they are not only working on distributorships, but we have specific people assigned to the UK and to Europe to work on sales there. So, again, I don’t think that’s changed. I think as I mentioned, we expect to meet the numbers, and again I think the more exciting factor now is the distributors who we are starting to sign up will change those numbers and as they come on board, we are requesting that they begin to give us forecasting. So I think as they come on board, we will get more visibility and obviously Eric as you well know as we move into a new technology, that’s always the issue. It’s real visibility on how many sales are going to be done, and I think that’s where we are going to be looking for directions from those distributors, because they are going to know their customers better than anybody. But again as far as the 95, I think it was actually around 110 now that we have got. I think those are still moving out the door or purchase orders are expected momentarily. So again, I think we are going to hit those numbers and I am pretty confident that we will also hit the numbers when we talk about having 35 to 40 distributors signed up. Eric A. Stine – Craig-Hallum Capital Group LLC: Okay, that’s helpful. Maybe just then moving to the opportunity with Snam Rete, just curious where that stands and I know it’s tough to predict as it’s the Italian government, and all, but any thoughts there would be helpful? William J. Clough: Yes, I have a dinner scheduled in London actually on 29 with Daniele Gamba who is the third highest ranking executive at Snam Rete. He actually is in charge of their fixed assets, and hopefully I’m going to have some visibility. I know they did meet with their Energy Minister just recently. The dinner is specifically for me to in essence drilled on him as to what scheduling looks like, so I will know more as we move forward, but yeah, you are right, the funding is there. They’ve already ordered the field units. They are starting to take delivery on those. So again, it’s one of those things where we hope to get information any day, but have not got anything yet. I will tell you this though, their five-year plan is now about I think 20 months or less away from the mandatory completion. So they’ve got to make some moves pretty quick, because they under the Italian law, if they don’t use that money, €80 million, which is sitting there in that timeframe, then it goes back to the bond holders. So it’s not something that they can really play around. So I suspect something is going to happen in the short-term. Okay? Eric A. Stine – Craig-Hallum Capital Group LLC: Okay. And just, I mean no change that your device is kind of the one that’s targeted… William J. Clough: No, no. No change at all, not at all actually. Actually quite contrary, I mean it’s very solid and they’re doing through our distributor [stock too], but it is still, it is the device of choice. There is no doubt about that. Eric A. Stine – Craig-Hallum Capital Group LLC: Okay. Maybe one last one from me. Just thoughts on timing on moving calibration of the GasPT over to Orbital from GL, how long it takes once that starts and what do you need to see in terms of demand to do that? Thanks a lot. William J. Clough: Yes, thanks for asking that question. That’s a great question. We have actually gone ahead and built the lab out. So we are set to go. Actually we could move that calibration over in a matter of days. It’s now just a matter of demand. We have the units available right now and inventory to deliver we believe this year’s environment. If that’s to change, for example, (inaudible) comes with a big order or somebody else who comes to a big order we could literally have our calibration up and running within a matter of two or three days at Orbital. So we’ve not had made that investment. We build out the lab and actually it’s quite a nice facility for those of you that have been out there and maybe saw the build out as we are going through, but it’s now ready. It’s up and ready to go. All we have to do is pull the trigger. Eric A. Stine – Craig-Hallum Capital Group LLC: Okay. Thanks a lot. William J. Clough: Sure.

Thank you. Our next question comes from Noel Atkinson from LOM. Noel Atkinson – Loewen, Ondaatje, McCutcheon Limited: Good morning. Thanks very much taking the call. Daniel N. Ford: Yeah, no problem. Noel Atkinson – Loewen, Ondaatje, McCutcheon Limited: I was wondering if you could talk a little bit about the gross margins that you achieved in Q2 in your two different segments. William J. Clough: Sure. Dan, you want to take that one? Daniel N. Ford: Yeah, I can pull that up. CUI state is kind of the typical range where they have been at. Let me open up the details for the individual segments and I’ll run that specifically for you. Noel Atkinson – Loewen, Ondaatje, McCutcheon Limited: Okay, so maybe I’ll just continue here. Can you talk as well about the Probe Technology that you’ve acquired, are you able to go to market now right away and start marketing into similar applications or does it take some time for you guys to get your feet around it, and get the products optimized to go to market? Daniel N. Ford: No it’s in the market already, in fact there is 150 of them in National Grid system already, and that the company we acquired from had been doing some sales, they’ve got in essence because of their issues with funding and other things, they won’t be able to focus on the sales as quickly and as really broadly as we can, but it’s already in the market. There is no time to market here, it is a product. It’s fully set up, it’s certified to Ofgem obviously, it’s being used in National Grid and others. So now we’re in market right now, in fact part of the package that we are taking to these distributors, which is so exciting for them is not just the GasPT and GasPTi, but the thermal well and other applications of the VE technology. It is quite unique, so it’s ready to go. There is nothing more needed, it’s actually out in the market and we’re just going to expand the market base, okay. Noel Atkinson – Loewen, Ondaatje, McCutcheon Limited: Yeah. Sorry, ahead please. William J. Clough: The power and electro-mechanical group has gross margins of 39.14% in the quarter and the gas segment had margin of 38.45% for the quarter. Noel Atkinson – Loewen, Ondaatje, McCutcheon Limited: Okay, great. And so in terms of Orbital, the IRIS, the Probe, you guys are doing a lot in the UK by the sounds of it with National Grid, and two questions related to that. What is the total backlog share that the National Grid accounts were, as of the end of June? And then secondly what is your efforts on going to sort of take those product lines and go beyond the UK into other markets? William J. Clough: Dan, can you break out National Grid that bigger and then I’ll answer latter part of the question. Daniel N. Ford: I don’t have the detail of the backlogs, but I can tell you that they are significant concentration for the company. So from a revenue standpoint they were a concentration for the three months end of 21.6% revenue lines. So they’re big, a big piece of our company. Noel Atkinson – Loewen, Ondaatje, McCutcheon Limited: Of total Orbital revenues. William J. Clough: Total revenues? Noel Atkinson – Loewen, Ondaatje, McCutcheon Limited: Yeah. I love that you guys do this on (inaudible). It’s great. Daniel N. Ford: We can’t add to the (inaudible). William J. Clough: Our total revenues were like 70% to 75% of just Orbital revenue business. Daniel N. Ford: (inaudible). William J. Clough: So the answer to your question, if you look at Orbital right now it’s about 80% contractual, with a large amount of that, as Dan mentioned, coming from National Grid and about 20% product with almost all of that being done in the UK. Our job, our execution here is to take that Orbital, that company maintain what it’s doing with National Grid because we think that relationship is so important, expand our relationship and in the meantime expand their product portfolio after the rest of the world. And what we’ve done has literally taken a group of their own sales people and brought in three new sales people, which we are going to expand I think even more as we move forward and set up a separate product company. That’s what we’re doing. We’re setting up a separate product team that is focused on really marketing the products that they have, the real unique products that they have to the rest of the world. And we’re doing that in a number of different ways. One way is, obviously we are out getting these distributors and going through a distributor network system. The other is, as Andy Ridge and I have made a real effort to increase our relationship with National Grid at a much higher level, because what we want to do is use National Grid as a resource. I mean, quite frankly National Grid has a great presence in North America on the eastern seaboard. They run power, gas, electric on that eastern seaboard and we are trying to setup a relationship whereby we can use their North America facilities as incubators, if you will, for the product and point it into North America on an even quicker basis that way. And frankly, those efforts to increase our relationship have been quite successful. We have moved up the ladder and we are now talking to people at the very highest levels of National Grid about partnering with them and it’s really, I guess, a matter of timing more than anything else. National Grid is under a very strict mission statement to decrease their costs by as much as 23% over the course of the next few years. They are doing that through a number of initiatives including developing very good relationships with some of their bigger vendors like Orbital, but they also want to do it through partnerships. And so we are going to use these technical partnerships to really, like you say, bring some of these products to North America in a even quicker method. But really our job in an execution pace is to do just what you talk about. We got on the one hand maintain and really keep that relationship with National Grid on a contract level, which we are doing by really leaving the team in place that handles that and forming this new group, the new team that is doing international marketing for the product line and we’re bringing engineering support to that, we’re bringing sales support to that. We’ll bring a whole team to that and they are the ones who are now initiating these distributors. So did that answer your question? Noel Atkinson – Loewen, Ondaatje, McCutcheon Limited: Yes. That’s great. And then finally, back to the IRIS again. So, could you guys talk a little bit about what the competitive environment is for that, particularly outside of what you’re trying to do at National Grid to what are you trying to – what problem you’re trying to solve there? William J. Clough: Yeah, it’s actually quite unique and here is what it is. With the remote telemetry units are like homeless without exception today in the gas industry, generally. They are very non dynamic. So you have a guy sitting in a room basically monitoring the entire higher system, whether it’s Kinder-Morgan system, whether it’s Williams Pipeline, whether it’s National Grid. He is sitting in this room or he has a big schematic lit up on the wall to take something out of NASA, where he is monitoring an entire system, and as a use psychology around alarms, I mean what they want to avoid is a cascade of alarms. So that guy sitting and monitoring that all of a sudden has a board that’s all red and he does no (inaudible). That filtering system generally gives him an alarm, if something goes off, at a station or sub-station, a metering station or pump station. He then gets on the phone, could be 1’o clock in the afternoon or 1’o clock in the morning he gets on the phone and calls a technician who is close to wherever that alarm occurs. That technician gets into his car or truck, he drives out to that station to get to that station. What he sees almost without exception now is a gauze type print out of attack that says follow that valve 17, till go out 17 wherever that happens to be he will pull that apart. You’ll figure out what is wrong with it and hopefully he has a part with him. And he will fix that pretty much as the way that remote telemetry is done in the industry right now. With National Grid, it is that they came to Orbital and said there is got to be a better way. There is got to be a way that we could put together, it’s more dynamic that allows our technicians to more active to what is going on in that station, whether it’d be a pump station, metering station, compression station whatever they have to be. What these historic systems have been is they are usually third party vendors who really lease the systems to the gas company. So they are licensed to individual computers, much like an SAP system or a Oracle system would be in a ETP sense. So again they are very again standard within the industry. What Orbital went out and did is changed totally the situation, and made it a web-based system. It was owned and operated by National Grid. So the system sits on their server secured to them. There is no licensing, there is no anything, it’s web-based, so that any technician who have the password, when they get that call from that room can pickup a tablet, pickup their computer, pickup their iPhone, put in the password, and what they see when they hop on that website is a schematic of that specific pumping station, metering station, compression station and on that schematic are little, what looks like little bow tie, which actually represent individual balance. From their house, without going out to the location, they can close the valve, they can open the valve. They can check the bowl, and even do a diagnostic on the valve that will tell them what’s wrong with the certain valve. So they can isolate a valve for example that’s broken. They can move gas around that, they can call back and say, look, I have set this up, so that valve is out of play now or go out in the morning and fix it and now because I have the diagnostics, I know sitting in my house, what it needs to get it fixed, so I go out there with the part. So you will avoid the cost and hazards frankly of sending guys out in the snow or rain or whatever at one, 1 o’clock, 2 o’clock, 3 o’clock, 4 o’clock in the morning to replace something when they can sit in their house and literally do it at home, it’s that dynamic. We began installing those at National Grid and really the concentration, the real tough right now is mapping. We have to map each station and it’s a pretty long laborious task. What we are doing right now is our team is designing in essence plug and play method of mapping, and once that design is done, that’s when we feel we can take that out of National Grid and move it to the rest of the world, and it really is truly dynamic. It’s something that it’s just not available right now in the gas industry, that’s what it does, and sorry for the long answer, but that is really what it does.

Thank you. Our next question comes from Joel Achramowicz from Merriman Capital. Joel W. Achramowicz – Merriman Capital, Inc.: Thank you very much. Good morning guys. Bill, another maybe follow-on on that question, how many of those valve or pumping station, I think you’ve mentioned it before, but it’s pretty extensive network business? William J. Clough: It is. Actually if you look at National Grid, which is really a small operation quite frankly, it’s just right around 350 at the transmission level and it’s been at 1,800 at the distribution level. So, yeah, it’s quite an operation when you start looking at it. If you look at some of the major U.S. operations; Alliance, Kinder Morgan, Williams, you’re talking into the thousands of units that you really are. So, again a small, just to give you an idea, like you said, National Grid, which is a relatively small transmission setup it’s just that UK about 350, 360 total at the transmission level and as many as 1,800 at the distribution level. Joel W. Achramowicz – Merriman Capital, Inc.: And those are pumping stations? William J. Clough: They’re everything from pumping stations to – pretty much anywhere where you’re dealing with the gases and mostly that pipeline. Joel W. Achramowicz – Merriman Capital, Inc.: I wanted to maybe go into the Probe question because you talked about the focus of using the VE-Probe with the GasPT2, then you talk about basic opening up all these additional opportunities or you call them your wish, could you maybe just give us some color on what they might be based on the size of some of those opportunities? William J. Clough: Yeah, well let me just explain it. What the VE-Probe does, because you don’t know, there is a big issue right now in all pipeline constructions and it just fluid dynamics. When you put an essence of vertical tube into a gas flow, you’re going to get just because of the fluid dynamics a vibration. That vibration will tend to cause that vertical probe to crack and so what’s happened is over the course of the years to prevent that cracking, the industry has begin to strengthen or stiffen that Probe, and they only make it bigger and bigger and stronger and stronger. What they are trying to discover now, that doesn’t stop the vibration and it doesn’t stop the damage to the metal, it just transfers that damage to the pipeline itself. So now instead of having probes crack they are actually finding microscopic cracks around the Probe where they are connected to the pipeline, we took a different approach with that. Literally what we did is, took an approach where we took the fluid dynamics to reduce it and you see this often time for example in car antennas or on big industrial pipe stacks. You see this layered circular system that goes around the outside of the pipe or around the outside of the antenna that stops it from vibrating, it simply sheds if you were in turbulence, which is exactly what it does. We applied that proprietary pattern, we applied that to the Probe that goes into the pipeline, as a by product of that what we were able to do is sample or take a sample of gas, much smaller sample much quicker and much cleaner, because we didn’t use what typical probes or sampling system used which is proper pressure to draw the gas in new sampling system, instead we used it with the fluid dynamics to drive in. So now what we have is a sampling system that can provide gas to anything from a gas chromatograph to obviously to the gas PTI to a Mercury Probe to any number of things we can have supply to anything that takes gas out of that pipeline and we can put our sampling system on and what we do now is instead of taking 10 or 15 minutes, which is what standard sampling system say, to decompress the gas, keep the gas, make sure it’s still thirsty, get in all the particles out of it, do all the things you have to do in that 10 or 15 minutes time period. We can draw that gas out clean and supply it in less than two seconds. So you are getting actual real time gas out of that pipeline very, very quickly that you would not be able to get. That applies not just the GasPT. Now, obviously, with the GasPT we give them three second analysis. So the total package is less than five seconds from sampling to analysis, but it works just as fast on anything else that needs sampling. And then, if you take that fluid dynamics, that vibration that applies just as well to thermal wells and all of thermal well is a probe that goes down into the gas pipeline where you drop a temperature probe so that you know what the temperature of the gas is, which is, it’s very important as the gas travels with that temperature stay consistent and that operator know it. So, again, if you got a pipeline, I mean if there are hundreds of sampling systems and hundreds of gas chromatographs and hundreds of GasPTs online, there are thousands of thermal wells because those temperature sensors are much more ubiquitous over the course of that transmission or distribution system. So that’s why the opportunity for us would be VE-Probe now, now that we own the entire package is just so dynamic. It really is. It’s added remarkably to what we can do as far as distributors and sales into the market. Joel W. Achramowicz – Merriman Capital, Inc.: And all these similar wells will be connected into the IRIS system, right? William J. Clough: No. They actually connect directly to the SCADA system to whatever the monitoring is as they would go into the monitoring of the pipeline’s quality. So again, think about this. The SCADA system controls the actual pumping, valve, metering stations. So it’s right out there, but all of those stations, the metering stations, the thermal wells, they are all reporting a SCADA system generally or some type of computerized system that’s actually telling the operators what the gas is doing is best to their pipeline. So there are two different systems. Joel W. Achramowicz – Merriman Capital, Inc.: Okay. Regarding long-term margin expansion potential, I mean, the IRIS part you talked about having a solid or maybe even a higher historical margin than your historical margins along with some of the improvements in the margins related to the new agreement you have for the VE-Probe Technology. Dan, do you have any indication of maybe what kind of long-term model we might look at in terms of gross margins in the months ahead? Daniel N. Ford: I think for modelling purposes, I’d stay at around that 38% to 40%. We are going to do everything in our power to maintain that and you may see some expansion as we get into some of the newer products. If you look at CUI for example, there will be a quite a bit of expansion when we talk about Novum and Solus sales trying to ramp up, because those are obviously new technologies that have not been commoditized and will be. And so, again I think you may see some expansion, but on the other hand, let’s face it. As we go out and grab more OEM business on the CUI side, you are going to see some contraction in margin because the bigger OEMs are going to order bigger orders, but obviously are going to expect better pricing. So I think in that regard I think the 38% to 40% is a pretty good model. The same thing on the Orbital side, I think we’re really pushing to keep the margins where they are or obviously increasing some if we can. I think as GasPT comes more of a part of the revenue, you are going to see obviously an expansion of those margins because it is a bigger margin. But again, I think for modelling purposes I would say at that 38% to 40%. Joel W. Achramowicz – Merriman Capital, Inc.: All right. Daniel N. Ford: I couldn’t have said that better, Bill. Thank you. It’s coming from you. That’s great. Thank you. Joel W. Achramowicz – Merriman Capital, Inc.: Dan, do you see or are you considering any seasonality perhaps in the Orbital area because of the European – the summer, in the current quarter, is there anything we should be thinking about there? Daniel N. Ford: Well, the overall business is not seasonal. They are impacted by weather obviously, because they are outlaying concrete path, doing considerable work at some of their installations. But it’s not necessarily a seasonal aspect as much as just timing of when customers are doing their projects. So we’ve looked at it. It’s actually and fairly consistent on a quarterly over the year’s basis. So now there is a lot of seasonality we’re looking at. They do locations in fact we got a week delay, or two week delay to see the weather issues, but I don’t think that’s not really a seasonality issue, so… Joel W. Achramowicz – Merriman Capital, Inc.: Okay, great. And one final question. You got a bunch of cash now on the books. Would you consider is buying back stock is where you said cash going forward? William J. Clough: Let me jump in and answer that. Here’s what Dan and I are doing quite dramatically. We are acting that we don’t have the cash in the banks frankly. We are trying to maintain ourselves really be conservative and hold that cash tight to our vest. We will look at a lot of different options as we move forward. Obviously, we think that there is a great opportunity here with this company and where we’re going now. If we see the opportunity to reinvest in ourselves that may well be something we think about, but at this point really we want to keep that cash close to our vest. We think that at this point we are in a very strong position in that regard. I mean I know we get the question all the time. Oh, you got all this cash, what are you going to buy next. That’s not where we’re looking at all. We believe at this point this is an execution story. What Dan and I really have to do from the CUI Global level is make sure we allocate resources to Matt and Andy in such a way that they can maximize their businesses. They are both incredibly good at what they do. We now have the resources to give to them to make them even better in what they are doing and that’s our key. Our key is sales, revenue and generating monies to the bottom line. That’s what we’re going to be doing. And again, treating that cash, it’s a luxury obviously to have it especially in this Dan age, but bottom line is we want to treat that cash as what it is, precious. So, again Dan you want to add some to that? Daniel N. Ford: Yeah, just one key factor to what that cash allows us to do is allows us to finance our growth ourselves rather than paying a bank to do that in the form covering our receivables if they grow covering our inventory and working process those increase with our revenues. So that cash balance, it is a nice number there. It allows us the flexibility for the growth that we see coming down the pipe, so that’s intention as Bill mentioned. As of now we don’t have it but it is a luxury and it’s going to provide us with potentially the ability to grow, with (inaudible) for that benefit. William J. Clough: And hopefully these new distributors will really drive sales going forward and provide operating leverage. That’s the plan. Daniel N. Ford: Exactly. Joel W. Achramowicz – Merriman Capital, Inc.: Thanks guys. Daniel N. Ford: All right.

Thank you. Our next question comes from (inaudible) who is a private investor.

Good morning. William J. Clough: Hi.

I wanted to ask you about Orbital’s base business. It looks to me, please correct me if I am wrong, that there was a $3 million to $4 million year-over-year decline in overall UK base business excluding any contribution from a gas product PT sales. That’s a 30% plus decline in sales year-over-year through the first half calendar 2013. Should we extrapolate that decline through the rest of the year it seems that is not likely because of the large backlog but could you.... William J. Clough: Let me stop the press, let me stop you right now there is no decline, there are on increase. Dan, you want to address that, I am not sure where that’s coming from..

Well, I’ll tell you where it’s coming from. You were showing pro forma revenue numbers in the 10-Q of $32.8 million, of which CUI is $22 million round numbers. And that really is $10.8 million for Orbital-UK for the first half, in the first half of last year, they did $13 million and this year’s first half it includes some revenue numbers from the GasPT2 products of $400,000 in the first quarter, I don’t know how much in the second quarter and the net result is, we’re working at about somewhere between $9 million and $10 million sales from Orbital space business for the first half of the year, $5.6 million of which was reported in the second quarter. So I am just looking at the pro-forma numbers you guys put up in the 10-Q and subtracting out CUI’s numbers and the rest has to be Orbital, so there is a sales decline. Daniel N. Ford: Eric, we are not looking at a sales decline for the year.

Okay, thank you. With that big backlog I would think not, number one. Number two, just I am sorry I really missed your story, you said that the – just review that analysts we are estimating GasPT unit sales of between 150 units and 175 units for the year, you shared a number of 95 early on the call, was that number a projection for the year or is it added to the unites we’ve already sold year-to-date? William J. Clough: Yeah the 95 numbers something that Eric had asked on the last quarter call and what that really was, at that he asked for the numbers that we had almost 90% share. What we had said in our internal sales forecast is 75% and 80% and 90% share certainly, that’s how our sales guys do that.

Got you. William J. Clough: I think in the last call that 95 was a part of the one that we already hit the one and we are close to it, that was 95 and then what it have like I believe, what I was answering is, is that 95 still coming and yes it’s and it’s still at 90% of better assurance.

So any other way to close that is to somewhat lesser degree of visibility, but still reasonable expectation, okay. And then is it the Energy Management Consulting Group that distributes for you in the U.S. I think you said if given your 150 unit purchase order I think I read that in 10-K that order was received in December last year. Are you shipping to EMC against that order yet or not? William J. Clough: We have shipped 10 against that order, but that’s all we have shipped to this point.

Okay. William J. Clough: I think they have installed either three or four of those. And obviously they believe they will get installed, but again the only 10 have been shipped to get back.

And you booked sales as soon as they shipped to them? William J. Clough: We booked sales when they shipped, correct.

So they don’t have rate of return on any units that they have got. William J. Clough: All right.

Okay, great. Thank you, very much, appreciate it. William J. Clough: No problem, thank you, bye-bye.

Thank you. Our next question comes from Morgan Frank from Manchester Management. Morgan Frank –: Hi, guys. Couple of quick housekeeping questions. So with the Orbital in Q2 for the whole quarter, was there any sort of [doubled] revenues that is not included in Q2 or did that start from April 1?

Hi, guys. Couple of quick housekeeping questions. So with the Orbital in Q2 for the whole quarter, was there any sort of [doubled] revenues that is not included in Q2 or did that start from April 1? Daniel N. Ford: Started April 1. Morgan Frank –: Okay. Second question on PT2; what was your ASP for the quarter? I guess some sort of trying to get out here is, what was the mix of just probes over the whole box within all whole box having your combined energy or you can give or kind of walk us through sort of ASP assumption, use some of them of course?

Okay. Second question on PT2; what was your ASP for the quarter? I guess some sort of trying to get out here is, what was the mix of just probes over the whole box within all whole box having your combined energy or you can give or kind of walk us through sort of ASP assumption, use some of them of course? William J. Clough: Do we have that broken out Dan? Daniel N. Ford: You will have better answers than I have from Andy. Typically though we were selling primarily the whole box PTi, Bill are those in the 50,000 range? William J. Clough: That’s correct, 55,000 and actually I will tell you, yes, most of them were full box. I think the only ones that were not were the some that we delivered to EMC. Now that you mentioned it, because all of the ones that went to Alliance were full box, all the ones that went to GE and all the ones that have gone to National Grid and the UK groups. I believe let’s say, probably about 80%, 90% of them were the full box, 55,000. Morgan Frank –: Of those 10 that have gone to EMC, how many were in Q2?

Of those 10 that have gone to EMC, how many were in Q2? William J. Clough: I think six were in Q1 and four were in Q2. And those were all just the devices, just $16,500 devices. Morgan Frank –: Got it. So last question as we look at the new distribution network, you have got 14 guys up here, you are hoping to decline by the end of September. Are there going to be stocking orders for those guys or what sort of tie up does it take it for signing a guy up, and having them become to active in selling products, and I am just trying to figure out how to anticipate the ramp that we associated with those guys?

Got it. So last question as we look at the new distribution network, you have got 14 guys up here, you are hoping to decline by the end of September. Are there going to be stocking orders for those guys or what sort of tie up does it take it for signing a guy up, and having them become to active in selling products, and I am just trying to figure out how to anticipate the ramp that we associated with those guys? William J. Clough: Yeah, it’s really tough for me to answer that right now, simply because we are in the middle of signing them. I know that we are insisting that they take at least two of these; one for demo and one for stock and that we are in fact pushing for sales forecast as they sign up. But again until I get some of those sales force guys, still I start seeing those, it’s going to be tough for me to tell you how fast they are going to ramp. I will tell you this though, everyone of them are in the industry, selling into the market, selling metering devices, and they are not in it to sit on stock. So I know that the people we’ve had so far mostly European at this point are really quite that eager to get the product and get out to market, but I don’t have the visibility to be able to tell you what numbers we are going to look at. Morgan Frank –: So had any of the 14 that you have currently signed kicking on those two unit check, was any of that included in Q2?

So had any of the 14 that you have currently signed kicking on those two unit check, was any of that included in Q2? William J. Clough: None of that was included in Q2, we’ve had some in the third quarter, but none in Q2. Morgan Frank –: Got it. Okay, great, thank you very much.

Got it. Okay, great, thank you very much. William J. Clough: Sure.

Thank you. Our next question comes from Jim Kennedy from Marathon Capital Management. Jim G. Kennedy – Marathon Capital Management LLC: Hi guys. William J. Clough: Hey Tim. Jim G. Kennedy – Marathon Capital Management LLC: Hey, Bill just wanted to drill down a follow-up on that distributor question from the last caller. Could you just kind of describe the profile of your distributor class if you will, are these large companies, are these what we might consider to be manufacturers’ reps, you’ve already said that they are in the market selling metering products, what is the typical size of these firms and where do you think you will fit within their scope of product offerings? William J. Clough: Sure, the extent, in Europe what we we’re seeing is anywhere from $7 million to as much as $25 million and $30 million in revenue year these companies makes, so it’s really smaller companies, but that’s how Europe is broken-up, very prestigious, Kontram from example in Norway, is one of the first that signed up. They are very respected in that entire area up in there and so they are quite excited about it. They are representatives of other new metering devices, gas chromatographs and others, and again I can’t really tell you what part of their business will be, I can tell you that our hopes are that we are going to take a very strong part of the market from, I guess chromatographs, and if that’s true then obviously it would be a bigger and bigger part of their operation. In the U.S. we are looking at people like Benchmark up in Canada, a very, very large distributor, and these are by and large, large distributors of metering processes. Everything from flow meters to gas chromatograph to any number of metering devices and they are selling into the industry, as I mentioned now. So, it really depends. Like saying in Europe most of the distributors are smaller. In the U.S., I have a team right now as we speak in the U.S. In fact they just presented at a big gas show in Pittsburgh and they are meeting with U.S. distributors right now. So I can’t really give you a take on who they talk to or what the size of those distributors are, but I know they are bigger just revenue wise in the U.S. than they are in Europe. Jim G. Kennedy – Marathon Capital Management LLC: Okay. And then your direct sales folks, are they selling to the distributors or they are going to directly to the end customer? William J. Clough: In the UK, they are going directly to the end customer and then we’re keeping some customers, as what I would call, house accounts. For example GE, we are keeping as a house account because we feel that it’s a huge opportunity plus there is a lot of engineering support that GE is needing. So we’re actually keeping that in house. Snam Rete, while we are dealing through Socrate we are really more direct with Snam Rete than anybody else, because again we see that as a big opportunity. But like you say, other than Snam Rete, GE and the UK where we are selling direct, the rest of it will be through distributors. Jim G. Kennedy – Marathon Capital Management LLC: Okay. And so what is worth, I love your cash comments earlier and I echo your sentiments about parting and the best you can. William J. Clough: Thank you, Jim, and by the way I am meeting with Snam, just so you know. Jim G. Kennedy – Marathon Capital Management LLC: Good. Hey, last question for you. In the Q, you talked just briefly about TPI, Test Products International and that’s about, I don’t know, $6 million, $7 million of revenue. Is that a strategic part – why are we, it’s the handheld test and measurement equipment market? William J. Clough: Yeah, and actually we are minority ownership in that company. CUI has that ownership interest when we acquired it. So it’s something that came with the acquisition. VE, I think, it was 10% I think it’s down about 8% now, just dome dilution. So it’s just a very small investment that we have, it’s not something where we are operationally involved at all. Jim G. Kennedy – Marathon Capital Management LLC: Okay. And it’s not costing you any money? William J. Clough: No, no, no. actually yeah not at all. And I will tell you that’s actually how we got I’d say as you probably will recall, that’s how we got the GasPT device, it’s through that relationship. Jim G. Kennedy – Marathon Capital Management LLC: Okay. All right. Great, good guys, congratulations and we wish you more success. William J. Clough: Thank you.

Thank you. Our last question comes from David Levine from Accredited Members. William J. Clough: Hi, David. David L. Lavigne – Accredited Members, Inc.: Hey, guys. How are you doing? William J. Clough: Good. David L. Lavigne – Accredited Members, Inc.: Unlike someone on the call, I actually have been involved in this story for longer than Bill has been involved in this story. And I have to tell you that sort of all things considered in adding it all together, I sort of view this quarter as set for the company. I think it’s pretty remarkable what you’ve done actually. So that said I just had a – most of my questions got answered, did have a couple of questions. Can you just give me that number on the pro forma Orbital bonus again? It’s not pro forma though it was an actual bonus, right, I mean it’s from the prior quarter, right. Daniel N. Ford: Correct. William J. Clough: Yeah. David L. Lavigne – Accredited Members, Inc.: I am sorry, how much? Daniel N. Ford: It’s about a $1.5 million, U.S David L. Lavigne – Accredited Members, Inc.: Okay,. The other thing is did you give us some kind of a price point on the Probe? Daniel N. Ford: The probe, it depends on the iteration. It depends on whether we make it for a GC, or whether we are making it for just a thermal well. It’s going to be somewhere between $7,000 and as much as $22,000, $23,000. So some are between $7,000 and $23,000, depending on what the application is. David L. Lavigne – Accredited Members, Inc.: Okay. William J. Clough: The size of the pipe is a factor in that as well, because you’ve got 24 inch pipes and smaller pipes, and so all factors into it. David L. Lavigne – Accredited Members, Inc.: Okay, the other-the last question is can you give us some sense of kind of what the kind of the rollout or how we should look at the backlog in terms of what that means, just some color on how model or how to use that backlog number and trying to determine what’s have in the model? William J. Clough: Sure, Dan you want to talk through that? Daniel N. Ford: Absolutely Dave, the CUI, the power and electro-mechanical backlog, that typically turn in six months to nine months and that and it’s continually getting replaced, the Orbital backlog or the Gas backlog I should say as it stands out is more dominated by some large contracts than smaller contracts. Smaller contracts turn quicker and they replace quicker, so that large order backlog is, it represents about a year’s worth of turnover, some of that will turn faster and some of that will take a year and a half to two years depending on the terms of the contract. What we are looking at Orbital though is consistent projections for this year with what they have done in the past and in the growth factor it’s going to come into that will be the GasPT and the VE-Probe. So I think the answer to your question, the way to look at the Orbital backlog is more less than annual backlog and the return rate on a sort of weighted average looking at that the CUI term-log is six months to nine months. David L. Lavigne – Accredited Members, Inc.: Great, perfect thanks guys. William J. Clough: Thank you. Dave.

Thank you. At this time, I will turn the call back over to Bill Clough for closing comments. William J. Clough: Thank you. I appreciate it. Just again thank you all for attending and again thank you for your continuous support to the company. Again this has been a vital point, I think as some of the callers mentioned, Dave particularly, we brought this company I think to an incredible point right now, but we both realize, Dan and I did the hard work and is just beginning. Now we have to execute and that’s our commitment that is we are going to execute. We have the team, we have the resources. We really are going to move forward now I think with all that. So with that, thank you. And Landon, anything further?

No. Thanks very much. William J. Clough: Thanks guys.

Take care. William J. Clough: Take care. Bye-bye.

Thank you. This does conclude today’s teleconference. You may disconnect your lines at this time. Thank you for your participation.