Casey Stegman - Investor Relations Bill Clough - Chief Executive Officer Dan Ford - Chief Financial Officer

Eric Stine - Craig-Hallum Joe Maxa - Dougherty & Company Andrew D’Silva - Merriman Capital Marco Rodriguez - Stonegate Securities Evan Richert - Sidoti Bill Nasgovitz - Heartland Fund Morgan Frank - Manchester Management Roger Liddell - Clear Harbor Asset Management Gregory Macosko - Montrose Advisors Jim Kennedy - Marathon Capital Management

Good day, ladies and gentleman. And welcome to the CUI Global Inc. Third Quarter 2014 Earnings Call. At this time, all participants are in a listen-only mode, later we will conduct a question-and-answer session and instructions will be given at that time. (Operator Instructions). As a reminder, this conference is being recorded. I would now like to turn the conference over to your host for today, Casey Stegman. You may begin.

Thank you and good morning. Welcome to the CUI Global third quarter earnings conference call for 2014. We appreciate you joining us today. With me on the call is Bill Clough, Chief Executive Officer; and Dan Ford, Chief Financial Officer. The purpose of today’s call is to review the company’s financial results for the third quarter, as well as provide you with some additional color on the business going forward. Following management’s remarks, the call will be opened up for questions. Many of you have seen the company’s press release that was issued yesterday. If you have not, it can be accessed at the company’s website at www.cuiglobal.com. Today, during the course of this presentation, we will be directing your attention to a series of slides. Those slides can be accessed during this call from the link in the press release that went out earlier yesterday or from the Investor Relations section of our website at www.cuiglobal.com. As a reminder, this call will contain certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 as amended and Section 21E of the Securities and Exchange Act of 1934 as amended. Such statements are subject to risks and uncertainties that could cause actual results to vary materially from those projected in the forward-looking statements. The company may experience significant fluctuations in the future operating results due to a number of economic, competitive and other factors, including among other things our reliance on third-party manufacturers and suppliers, the government agency budgetary and political constrains, new or increased competition, changes in market demand and the performance or liability of our products. These factors and others could cause operating results to vary significantly from those in prior periods and those projected in forward-looking statements. Additional information with respect to those and other factors, which could materially affect the company and its operations, are included in certain forms the company has filed with the Securities and Exchange Commission. With that I’d like to introduce Mr. Bill Clough, CEO of CUI. Bill?

Thank you, Casey. Thank you everyone for taking the time to join us on this call today. I’m going to start with a brief overview of the quarter and then I’ll hand the call over to Dan to go over the financials. When Dan is done with his remarks, I will follow up with some additional commentary on some of the more promising things we are currently working on at CUI and then we’ll open the call up for Q&A. Let me begin by saying that I was very pleased with our performance for the third quarter of 2014, and in particular our top-line revenue growth as we recorded $21.4 million in revenue, a 24% increase as compared to the same period last year. The nine months ended September 30, 2014, our revenues were $57.5 million, a 27% increase as compared to the $45.4 million in revenues for the same period in 2013. Our gross profit margin for the quarter decreased slightly to 37% from 38%, but the gross profit margin for the nine months period ending September 30, 2014 increased to 40% versus 38% in 2013. Adjusted EBITDA for the quarter was $1.8 million or about $0.09 per share. On a year-to-date basis, we saw increases in revenue in both segments compared to 2013. The Power and Electro-Mechanical segment revenues were $12.9 million in Q3, which is a 15% increase as compared to $11.2 million in the prior year comparable quarter. Within the Gas segment, we recognized $8.4 million in revenue as compared with $6 million in revenue in the prior year -- I’m sorry, in the prior year comparable quarter, an increase of 40%. Growth in the Power and Electro-Mechanical segment was related to continued market penetration of its expanding product portfolio as well as growth within the distribution channels. Revenue growth in our Natural Gas Energy segment was driven primarily by an influx of biomethane projects in the UK, as the British government continues to incentivize the production of renewable energy. As I alluded to in our press release, the third quarter was an eventful quarter for CUI Global. I’ll review each of these items in more detail after a discussion of our financials. With all of that being said, let me turn the microphone over to Dan Ford our CFO, so that he can run through the numbers in more detail. Dan?

Thank you, Bill. I’d like to now give a financial overview of the third quarter for 2014. As Bill mentioned, the company’s revenues were $21.4 million for the quarter, up 24% from revenues of $17.2 million in the third quarter of 2013. The increase in revenues for the quarter is attributable to approximately $1.8 million of growth within the Power and Electro-Mechanical segment and $2.4 million of growth in our Gas segment. The year-to-date revenues of $57.5 million represent a 27% increase over the prior-year comparable period. Cost of revenues for the quarter was $13.4 million versus $10.7 million for the same quarter in 2013. The cost of revenue for the nine months of 2014 was $34.8 million versus $27.9 million in 2013. As a percentage of sales, the cost of revenue increased slightly to 63% for Q3 2014 as compared with 62% in Q3 2013. For the nine months ended, the cost of revenues as a percentage of sales decreased to 61% from 62% during the prior year comparative period. At September 30, 2014, the Power and Electro-Mechanical segment held an unaudited backlog of orders of $12.4 million and the Gas segment held an unaudited backlog of orders of $18.8 million. The EBITDA for the quarter was $839,000 or $0.04 per share versus $1.5 million or $0.07 per share for the same period in 2013. EBITDA for the nine months ended September 30th was $2.4 million or $0.12 per share as compared with $2.9 million or $0.17 per share during 2013. The adjusted EBITDA for the quarter was $1.8 million or $0.09 per share which compares with $1.6 million or $0.08 in the third quarter of 2013. The nine months adjusted EBITDA for the period ended September 30th was $4 million or $0.19 per share as compared with $3.4 million or $0.20 per share during 2013. Gross profit for the quarter was 37% or $8 million, as compared to 38% or $6.5 million in the prior-year quarter. Gross profit for the nine months ended was 40% or $22.7 million as compared with 38% and $17.5 million in 2013. Within the operating segments, the Power and Electro-Mechanical segment generated quarterly and year-to-date gross profit margins of 40%, while the Gas segment generated 34% quarterly gross profit margin and year-to-date gross profit margin of 39% at September 30th. SG&A expenses increased to $6.9 million for the quarter compared to $5 million for the same period in 2013. This increase is primarily result of ongoing activities to reach new customers, promote new product lines, new product introductions as well as the overall growth in expenses in relation to the revenue growth during the quarter. Included in this increase is $738,000 of equity compensation expense to the consultant for completed strategic consulting services regarding the testing and demonstration of the GasPT technology. As a percentage of revenue, SG&A increased in the third quarter to 32% as compared to 29% in the prior year period. For the nine months ended September 30, 2014, SG&A expenses were $19.6 million versus $14.2 million during the first nine months of 2013. The year-to-date increase as a result of the addition of SG&A activities of Orbital Gas Systems which was acquired in April 2013 accounted for approximately $2 million in additional expenses during the first quarter of 2014. Additional increases during the year-to-date period are consistent with those increases discussed for the quarterly period. And again that includes $738,000 of equity compensation expense relevant to the consultant services discussed previously. SG&A as a percentage of total revenue increased slightly to 34% for the nine months ended as compared to 31% in 2013. The company had positive cash flow from operating activities of approximately $1.2 million during the nine months ended versus cash flow provided by operating activities of approximately $2.4 million for the same period in 2013. The change in cash from operations is primarily the result of increases in assets and reduction in billings in excess of cost from operating activities offset by the net income earned before non-cash expenses. The company had a net loss of $349,000 or $0.02 per share for the quarter ended September 30, 2014 as compared to a net profit of $737,000 or $0.04 per share for the quarter ended 2013. For the nine months ended 2014, the company had a net loss of $903,000 or $0.04 per share versus net income of $712,000 in the same period 2013. The net loss reported for both the quarter and nine months ended September 30, 2014 as compared to the prior year periods are primarily the result of consistent increases for SG&A related to the increased revenues and selling and marketing efforts associated with introducing new technologies and Orbital to the global marketplace. Including the previously discussed equity compensation expense paid to strategic consulting for Gas segment related services. Adjusted net income, which represents the net income or loss plus the amortization expense of the intangible assets acquired be the 2013 Orbital acquisition plus the expense associated with the stock options and notes issued for compensation and services for the quarter, was approximately $1.4 million or $0.07 per share in 2014 as compared to $1.6 million or $0.08 per share in 2013. For the nine months ended September 30, 2014, adjusted net income was $3 million or $0.14 per share versus $2.6 million or $0.15 per share in 2013. At September 30, 2014, CUI Global held cash and cash equivalents at $17.1 million and short-term investments of $10.4 million. Also at September 30, 2014, the company had 20,742,481 common shares outstanding. And now, I will turn the call back to Bill. Thank you.

Thank you, Dan. Before we begin taking questions, let me take a moment to update you on a couple of the larger projects we’ve been working on over the past year, as well as give you some additional color on some of the key highlights from our third quarter. In September, we announced a signing of a distribution agreement between wholly-owned subsidiary, Orbital Gas Systems and Branom Instrument Company and Natural Gas equipment Distributor Company based in Seattle, Washington. The agreement calls for distribution of CUI Global’s patented natural gas technology included in GasPT, GasPTi and its CE Technologies. Specifically, the agreement gives Branom exclusive distribution rights for sales and rights within Northwestern United States including Washington, Oregon, Idaho and certain counties within Western Montana. We are very excited about this partnership, which we feel will have a significant impact on the North American natural gas industry going forward. Additionally last month, CUI was named as one of the three founding members of the Architects of Modern Power, a new power industry consortium. The formation of this group which includes two other globally recognized industry leaders represents a tremendous opportunity for CUIA and the other founding members who have a significant impact on the adoption of additional power technology. We are extremely proud to be a founding member of this exciting organization and we look forward to updating you on our progress as we move forward. We noted in yesterday’s press release that our Board of Directors has authorized a one-year program to repurchase up to an aggregate $3 million of the company’s common stock, which will be effective immediately. The amount and timing of any such repurchase will be determined by the company based on its financial condition, business opportunities and the market conditions at the time. It is our belief that there is a time to disconnect between the trading level of our stock and the significant near-term business opportunity set in front of the company. We as a management team along with our Board of Directors are firmly connected to maximizing shareholder value and therefore have authorized this program to opportunistically repurchase shares of CUI stock in the public market as and when appropriate. Now let me give you an update on some of the other areas. We have now signed up 38 new distributors in Europe, Asia and North America. In addition, last quarter, we announced the fact that National Grid has selected our IRIS technology for use in remotely controlling its entire grid. With that in mind, we recently attended the GE Intelligent Platforms 2014 user summit in Orlando, Florida where we met with GE’s Intelligent Platform Group’s management team. We continue to believe that our developing relationship with the Intelligent Platform Group represents a significant step in our plan to develop a substantial distribution network for our groundbreaking technology, and specifically for sales of our IRIS technology targeting North American energy producers and transporters. GasPT and VE Technology sales remained steady as we have now delivered 26 GasPT units, have received orders for an additional 27 units to be delivered this year and have an another 20 units out for bid. We are continuing to make progress in our larger GasPT opportunities including positive discussion with Snam Rete dominion compression energy transfer partners and others. In reference to Snam Rete specifically as we discussed during our last call, we had successfully completed field trials with six units and we’re awaiting an independent report from the University of Milan. We did receive that report and it was as expected quite positive. As such, we remain confident that we will receive orders from Snam Rete beginning in early 2015. In fact, all of these larger projects continue to move forward in a positive matter and are likely to be slated toward 2015 deliveries. Finally moving to VE Technology sales, we delivered an additional 18 VE sampling systems last quarter bringing our total delivery to 51 sampling units, while we delivered an additional 101 VE thermowell applications, bringing the total thermowell deliveries to 140 units this year. Furthermore, we continue to receive inquiries and are working with numerous potential VE technology customers including ConocoPhillips, ABB, Statoil and others. We are confident of our ability to close those deals, as we’re the only technology capable of providing the vortex elimination and rapid sampling time, which are unique features of the VE technology, allowing us to provide a safer, high-value solution to the natural gas operator. In conclusion, I’d like to thank everyone for your continued interest and support to CUI. As I often do on these calls, I want to reiterate our continued commitment to both our employees and our shareholders to grow CUI Global and its subsidiaries in an organized efficient manner, by introducing new products, attracting new markets, seizing opportunities and continuing to pursue and partner with some of the largest, most recognized industry leaders in both the natural gas and electronics markets. We believe that partnerships with companies like National Grid, Ericsson, GE, Snam Rete and others, along with continued recruiting of distributors like Benchmark Engineering in Canada, Ives Equipment Corporation, and Branom Instruments in the U.S., [Shen Wu FA] in South Korea, RealFlow in Shanghai, Digi-Key and Future Electronics can only enhance the credibility of our products, the viability of our technologies and ultimately the value to our shareholders. Now, with all that being said, let’s open the floor up for questions.

Thank you. (Operator Instructions). Our first question comes from the line of Eric Stine of Craig-Hallum. Your line is open. Please go ahead. Eric Stine - Craig-Hallum: Hi Bill, hi Dan.

Hey Eric, how are you doing? Eric Stine - Craig-Hallum: Fine. Maybe just real quick on Snam Rete, you gave details there, but could you just update us on kind of what the drop dead date is in terms of the funding being put to use there? And as you think about that is that still net 1,500 unit area and are they still looking for just analyzers or is it the complete system?

Yes, things have changed somewhat, the date hasn’t changed. The date is mid 2015, June of 2015. They are now looking much closer at the combined units though and in fact have visited, as I may have mentioned you, they have visited the facilities at National Grid. And because of that visit, became very impressed with the combined sampling and GasPT system. So, they are talking about some of the systems that they will allow, will be the combined systems; they haven’t defined how many or which would be, which type. But I think they are much more interested in that, than they once were. I don’t think they truly understood the advantages of the sampling system when it was combined with the GasPT; they do now understand that. And again they are very positive; they are very intent on moving forward; their procurement system is simply set up to start operating first quarter. That’s their timing, they told us that. So, we’ll see what happens. I’ll be honest with you. They are big organization. I think if they start the project moving forward and they hit a deadline, I don’t see them losing money as long as they’re moving forward. But we certainly expect some orders, significant orders in the first quarter of next year, because again, they are talking about 1,500 total units. Eric Stine - Craig-Hallum: Okay, got it. That’s helpful. Maybe just turning to the distributors, some of these distributors you’ve had for I guess probably two, three quarters. Just curious traction you’re seeing from those early distributors who -- Benchmark, Ives and some of the other ones. And then what type of visibility that gives into the pipeline and making traction in that pipeline?

We’re getting some traction. Certainly, with Ives and Dominion is a great example, they’ve gone into engine testing with the Dominion and Dominion is talking about as many as 200 units, when they get up and running. So again, I think Ives is a great example. Benchmark is working with their only real customer which is TransCanada. But again, I think when you’re introducing new technology into the marketplace, the issue with distributors until you actually pull it into the marketplace is they’ll go and visit their big customers, present this exciting new technology and their customers go well, do you still sell GCs? Oh, yes, we do. Okay, we’ll take a GC. And that distributor is not going to fight the customer to buy something they don’t want. So it’s really incumbent on us as the providers of the technology to get out there and force the market to accept it to have the customer ask the distributor. And that’s what we’re doing now. We’re doing that in connection with conversation with ETP, we’re doing that working with GE and IRIS. And so it’s both, a push and a pull. So I think as we move forward, we’ll see those distributors being much more fruitful for us as we start to see the technology being pulled into the marketplace. Eric Stine - Craig-Hallum: Okay. Maybe last one for me just turning to the Power and Electro-Mechanical. I mean that was a very strong quarter, just can you talk about some of the relationships there that’s driving the strength or is it broad-based? And then how do you think about 2015 growth with Novum and Solus playing into that?

Yes, I think the first thing I would mention is that and we talked about this in the past, it’s not a rocket ship. In other words, there are good and bad quarters, there are up and down quarters. This was an exceptionally good quarter, absolutely for the electronics industry. And it was broad based; it was across the entire product portfolio. Really it had a number of different drivers, our continued relationship with Future which is becoming more and more important to us. And as far as Novum and Solus is concerned, we’re starting to see some traction develop there. This -- development of AMP organization that combines us with Ericsson and the Murata out of Japan, makes us really leaders in that digital power product division. And we’re in the electronic show right now in Germany where we’re introducing AMP and our relationship there. So, I think it’s going to be a big part of 2015. Again, we’ve talked about the fact that I think revenues (inaudible) won’t occur till the end of 2015 and really the ramp up there is going to be in the 2016. But again, I think the electronics end of the industry has done quite well and we expect that to continue. Eric Stine - Craig-Hallum: Okay. Thanks a lot.

All right.

Thank you. Our next question comes from the line of Joe Maxa. Your line is open. Please go ahead. Joe Maxa - Dougherty & Company: Thank you, a few questions. Good morning.

Good morning, Joe. Joe Maxa - Dougherty & Company: Hey so on the Snam Rete, did it -- maybe I heard incorrectly, but did you suggest that it could possibly go beyond middle of next year as far as -- once they get started, they will start rolling it out and you don’t really know if it will be done by June or could go longer is that how we should be thinking about it?

I don’t know, I’ve been told that it’s a drop dead date, June of 2015, but they are Italians and this is a huge, huge entity within the Italian economy. I can’t imagine if they start rolling this out and they are in the middle of rolling it out and June comes that they’re going to cut off funding for them. I don’t know that, they’re telling me that it’s drop dead date, 2015. But on the other hand, let’s face it, I’ve been dealing with them for 2.5 almost 3 years now we’ve been moving forward continually, but it’s the Italians and they do take their time. And I don’t fault them for that; it’s just simply the way they are. And again I don’t want to make it seem like I’m telling you exactly what they’re telling me and that is that the drop dead date is June 2015. But I’m telling you from my perspective I have a hard time believing they would simply cut funding if these guys were up and running and installing units and June comes and goes. Joe Maxa - Dougherty & Company: Right, right, I understand. The National Grid, do you have a sense when they will start ordering the next round of IRIS, have you got the RFP yet anytime you’re going to associate with those types of items?

No. When we get that RFP we’ll put that out in the press release, we have not. What we would do know is that they are real, reorganization has done now, they are focused largely right now on these biomethane projects at the end of this year because there is a change in the government underwriting regarding biomethane terminals at the end of the year as of January 1st. So, everybody is focused on that quite frankly. I think that assumes that’s over with which will be the January 1st because the tariff changes at that point. They’ll get back to the big project mode and that first big project as I understand is coming out of them is going to be for the retrofit of their IT, which would include IRIS. So, I think, I’d expect something in the first part of the year. Again, we’ve talked about in the past, it’s a 90 to a 120 days bid process, but we have not tune that busy effort, but I think it is coming. Joe Maxa - Dougherty & Company: I see, okay. And little more on the biomethane side, there was a big chunk of the revenue in Q3, are you anticipating that to continue in Q4 then given the tariffs at the change of the January 1st?

We have a number of projects that we expect to finish in Q4 whether they’ll finish right in Q4 or not it’s hard to say, but frankly we’ve got a load of those projects in there now, they are big projects, there are huge investments that we’re making that’s part of the SG&A hit that we took is just that. But again, I think we’re pushing to get those done January 1st now whether or not the money will come in and we’ll see that or be able to accrue that this year I just don’t know, but there are projects. Interestingly, we’ve actually now got increase for as many as 30 more next year, 30 more of these projects next year because there is some indication that the UK government will continue these tariffs. If that happens, it could be a big driver for next year as well. So again, they are big projects, we’re going to try and draw as many as we can into this year, but we expect a number of will be finished before the end of the year. Joe Maxa - Dougherty & Company: So, are these, so how many projects I mean are you in now just give us a ballpark how big this 30 could be?

Yes. There is nine in progress right now, I think we finished 5, I believe during the third quarter. And I think there is either 7 or 9s in there right now. Joe Maxa - Dougherty & Company: Okay. And are these, I mean they are clearly lower margin and that are some of the gross margin pressure in the quarter. Is that due to maybe some lower margin pass through revenue on some products or explain why these margins are a little bit lower?

The reason why they were lower is due to the time constraints on accommodating the delivery schedules for those. We had to pull in more labor, put in some overtime to meet deadlines. It wasn’t having you at the component cost, it’s having you with meeting deadlines for the customers timing. And that’s significant mostly because they’re trying to reset12, 31 and so on go live date and in order to meet that, we’re just try to bring in more experienced labor. Joe Maxa - Dougherty & Company: I see. Any sense on how that’s going so far this quarter where margins may shake out?

They will be, they’ll likely be slightly better, but they are still going to be lower than Q1 and Q2, just due to filled declining rates compressed on those projects. Joe Maxa - Dougherty & Company: Okay.

We expect doing in 2015 for those projects, because there won’t be the time constraint that that margin will recover. Joe Maxa - Dougherty & Company: Okay. That’s helpful. And just lastly maybe any color that you can give on with GE and the gas turbine side would be helpful and as well as with IRIS. Have you started to join marketing that you’ve talked about in the past?

That was part of the reason for the meeting in Orlando; we had a great meeting there with their top management of Intelligent Platforms. We are in already through on the joint marketing. Our first customer is going to be ETT and we’re hoping to set amaze with them the end of November and first part of December and that will be meeting intended by both us and GE. So, GE is very committed to that technology. As far as the gas turbine opportunity, we’re still dealing with their engineering team. They have some very unique gas combinations that they want to test us against. They still have a couple of more that they want to do that with. And again one of the reasons that I’m so forceful on this in terms of platform relationship is we’re trying to now get up to a more commercial level where we can really deal with a commercial team at Aero as opposed to an engineering and R&D team which really to some extent makes us think like this is a science project. Again, we’re really looking to drive into that market. As an aside, we did just last week get the first orders from Mitsubishi Power which is the new Mitsubishi Hitachi combination that are now -- will be I believe the second largest provider of gas turbines in the world. They’re ordered their first two units, much easier pathway there and we have two units that we’ll be delivering to them for use in Thailand. And if those two units do what we say they will which we believe they will they’re talking about rolling it out as an option on their fleet as well. So again, some movement there but not yet the movement that we want. Joe Maxa - Dougherty & Company: Okay. So a lot still to come but it looks like you’re moving forward on many of these projects.

Absolutely. Joe Maxa - Dougherty & Company: Thank you.

Sure.

Thank you. Our next question comes from the line of Andrew D’Silva of Merriman Capital. Your line is open. Please go ahead. Andrew D’Silva - Merriman Capital: Hey guys. Thanks for taking my call. Just a couple of quick questions. When you stated the 26 gas PT units were sold year-to-date that implies your revenue generating units. Correct?

Correct, yes. Andrew D’Silva - Merriman Capital: And do you have a breakout as far as PT2 and PTi goes on the units?

No, we didn’t. Generally speaking, they’re components of larger projects that we’re doing. For example the biomethane is a good example of that. The biomethane, each of those biomethane terminals has two to six gas PTs attached to them. So again, they’re components of other larger projects. So we did not break that out separately. Andrew D’Silva - Merriman Capital: Okay. And then with your biomethane projects, obviously it is in the bump in orbital revenues during the quarter. Are those on a percentage of completion method? And then if so, how many of those are carrying over from the third quarter into the fourth quarter?

They are on a percentage of completion method. I think Bill earlier mentioned that it’s 6 or 7 still in the pipeline. Is that correct Bill?

Yes. Andrew D’Silva - Merriman Capital: Okay.

For the year-end, but there are various stages of completion. Andrew D’Silva - Merriman Capital: Okay. And so that’s 6 or 7 total including ones that you might be working on from third into fourth quarter?

That is correct. Andrew D’Silva - Merriman Capital: Okay, good. And any sense or do you have a number of how many IRIS units have been installed or in the process of being installed year-to-date?

Yes. At the beginning of the year, there were 12 left to install and there is 69 or 70 that we’re installing. And I believe that there is two left to install at this point. So I think we’ve installed 10 more. Andrew D’Silva - Merriman Capital: Okay. And those again on a percentage of completion, I take it?

Yes. Andrew D’Silva - Merriman Capital: Okay. And last question Linde Group, and anything you can update as with their, obviously a much higher margin VE-Probe coming out of that opportunity?

I’m not sure, I understand your question.

The Linde Group status.

The Linde Group? No, I can’t give you any idea on that. The Linde Group did buy the two very expensive 137,000 sampling systems. They’re both the in; both as we understand operating well, but we have had no update at this point, so what they intend to do moving forward. Andrew D’Silva - Merriman Capital: What’s the TAM there again, the total addressable market for those units potentially within the company?

They operate I believe 20 terminals and those terminals could use five piece; you’re talking about what 100 units that you would have right there and they are about a $137,000 a piece, so fairly large TAM. Andrew D’Silva - Merriman Capital: Okay, great. Thanks guys.

Thank you.

Thank you. Our next question comes from the line of Marco Rodriguez of Stonegate Securities. Your line is open. Please go ahead. Marco Rodriguez - Stonegate Securities: Good morning guys. Thanks for taking my questions.

Hi Marco. Marco Rodriguez - Stonegate Securities: Just wanted to follow up here on a couple of items, on the power side, what percentage of your revenues are from new products and how does that kind of compare to last year?

I don’t have that broken out, but it wouldn’t be that significant of a number from the NPI products. A lot of the NPI introductions go into distribution and that’s where they start to penetrate the market and then their cycle time from going from an introduction to going into really manufacturing quantities is typically 12 to 18 months. Marco Rodriguez - Stonegate Securities: Okay, got it. And then shifting here to the Gas segment, last quarter, if I’m not mistaking, you guys were talking about flat to maybe slightly up revenues for the segment in fiscal ‘14. And obviously you had pretty strong performance here in Q3 with the biomethane stuff. Was that work somewhat of a surprise to you or were revenues pulled forward, just trying to kind of understand what’s going on there.

Yes, I think at the end of the day, the push by the government, by the UK government to really get these biomethane terminals up and running by December 31st was really a surprise to everybody. There was talk at the beginning of the year, a lot of talk actually at the beginning of the year that the government was going to extend that for another 12 or even 24 months and then they did. And so a lot of these companies really had to get these things done, Scotia being the biggest one out of Scotland had to get these projects done. Frankly we went over backwards to get them done, because we know that there is going to be a huge demand for these as we go forward. And we wanted to make sure that we partnered with these companies, especially Scotia and showed them what we could do. And that’s what we’ve done. But again, it was somewhat of a surprise for everybody that the government didn’t extend the deadline. Marco Rodriguez - Stonegate Securities: Got it. And I am not sure if I missed this or not in your prepared remarks but how many projects or units did you do on the biomethane side on the GasPT for Q3?

I think there is -- we’re doing a total of 13 I believe this year. And I think there is 7; I think there is around 7 left. So, I think it will be some like 6. Marco Rodriguez - Stonegate Securities: Got it. And just wanted to get a little bit better understanding on the Branom Instrument agreement and why you are thinking this will be a very significant impact for you guys?

Yes. When we partner with people like Branom or Ives they are long-term equipment distributors who are recognized throughout the industry. And when they adopt a technology like ours, it’s the first step for the industry to really make technology credible. Again, it’s Branom like Ives in the Northeast and Branom in the Northwest are both very, very highly respected, they provide a number of different instruments and instrument packages to the natural gas industry and have been doing so for years and years and years. They have a very experienced sales team. And again it’s the kind of group that we want there when the demand for our product arises. They are the ones that people will go to, because they have gone to them in the past to get the product, to get what they need in service, to get what they need in installation. And so, that’s why we try to partner with them Benchmark Ives, the bigger more respected companies.

And we’ve seen already with that several customer visits both with Branom on their own and then with our sales team as well, visiting them with Branom’s introduced the Orbital Gas segment products. And then on top of that, we’ve also done training at multiple of their sales, all those facilities just to get their sales team up to speed. So, Branom is quite proactive in this process and they’ve really kicking off on being active there. Marco Rodriguez - Stonegate Securities: Got it. And last quick question, following up on an earlier question regard to the distribution channel belief. Just kind of looking for some clarification, you mentioned that the distributors they go in there with the new technology to their clients. And then the client end up kind of sounded like they end up just going back and buying the GCs. But it sound like you were trying to change something from a strategic standpoint on the marketing side. Can you kind of provide some more color in regard to that?

Yes. I think what we need to do as the introducer of the technologies; we need to get adoption with some of the bigger groups especially in North America. We have Europe and certainly the UK, we have that recognition. In the U.S., what we’re doing is really attacking and this is the relentless venture’s relationship. We’re really attacking Energy Transport Partners that is the second largest pipeline company in the U.S. 62,000 miles of pipeline. And we’re really now meeting with them at the very highest levels. In fact we’re at a point now where we have their Head of IT and Head of Technologies looking at our devices, we’re setting up meetings I mentioned hopefully at the end of November first part of December, the GE will attend with us. And really, we’re doing a pushdown project with them. In fact one of the first pieces of feedback we got from the project manager at the ETP is that this is the kind of technology that at the lower levels it would be difficult to adopt because people just don’t want to change what’s already there. At the top levels, they see the cost benefit analysis, they see what we can do that other technologies can’t do. And so we can drive this down, if we can get Energy Transport Partners as an example to adopt this technology on their new pipeline, which they’ve just announced the building of 15,000 miles of new pipeline, then we can use that leverage with our distributors to introduce technology to other North American pipeline companies. Literally what we have is then an entire ground crew with these distributors ready to move. It’s now our job to get that ground crew what they need and that is credibility from one or two big pipeline companies. I’ve been told that it seems very obvious and I think it’s true in many industries. For new technology, they really take off and get adopted. You have to have an adopted by one or two leaders in that industry. Energy Transport Partners is known as a leader in the industry when it comes to technology. And again, we think if we can get that traction with them within our distributors, can deliver to other smaller pipeline companies. So that’s the key and I think it’s a combined effort; it’s an effort both from the ground up with the distributors and from the top down with ETP. Marco Rodriguez - Stonegate Securities: Got it. Thanks a lot guys.

Thank you.

Thank you. Our next question comes from the line of Evan Richert of Sidoti. Your line is open. Please go ahead. Evan Richert - Sidoti: Good morning, guys. Bill, in your prepared remarks, I think you mentioned something about sales to North America, Europe and Asia. I know you talked about as far as Asia goes sales to Mitsubishi and Thailand. I was wondering if you consider selling to any pipeline companies in Asia or if that’s still primarily just North America, Europe marked.

Well, we have two Chinese distributors now, [RealFlow] and one other. And they are actually looking to some extent at the pipeline industry in China. However, China has a little different concept of the way they transport gas. Much of their natural gas and other transport is done compressed nature and by vehicles. So, it is a little different. They do still need to monitoring, but it’s a different way of monitoring. So we would certainly look at the pipeline companies. And obviously we are looking at LNG terminals in Japan and Korea. So, we have applications there. But again, the big gas pipeline companies, you don’t find them in Asia prominently, simply because they have a different philosophy as to the way they transport gas. Evan Richert - Sidoti: Okay, that’s great. I’ll hope back in the queue. Thanks Bill.

Yes.

Thank you. Our next question comes from the line of Bill Nasgovitz of Heartland Fund. Your line is open. Please go ahead. Bill Nasgovitz - Heartland Fund: Yes, good morning Bill.

Hi. Bill Nasgovitz - Heartland Fund: So, Gas segment, I might have missed this, $18.8 million in backlog. What was it last quarter and a year ago?

Q2, the backlog, let me look that up and if you want ask the next question, I’ll pull it up. Bill Nasgovitz - Heartland Fund: All right, sure. The next, just moving to power, back to that, have you signed up any large electronics companies in terms of design-ins or partnerships? And what might the market potential be for this area?

The market potential is huge frankly. We’ve looked at the Daniel surveys and others that say that the market for digital power at the end of the day is going to be in the tens of billions of dollars, it is the way power is going. Our publicly announced partnership, the one that we’re obviously most proud of at this point is with Ericsson Energy, the second largest networking company in the world. And they have in essence worked with us through a joint venture and now through the AMP organization to introduce our technology with their footprint. And they’re big enough in the industry to set a standardize footprint. So, we have -- our product is already in their sockets, in Ericsson’s socket. We are moving out to have tests with other big companies. However, we don’t have any design wins at this point that we can point to, simply because once we do, they will be announced. I mean we will announce the design wins. We do have product out there; it’s been tested by some of the largest networking and telecommunication companies in the world frankly. And as those projects move forward, we’ll certainly be announcing them. But I think Ericsson and Murata, the two with AMP that we’re most proud of right now. And if you think about it, we’re partnered with multi-nationalm multi-billion dollar companies, two of them and CUI. And I think that’s no accident; it’s not a coincident. We’re partnered with them because they see that our technology is far in advance of the rest of the community. Bill Nasgovitz - Heartland Fund: Okay, thank you.

So, I’ve got the -- now I have answer for Q2 ‘14 and Q3 ‘13 backlog for the Gas segment and I’ll give you a little bit of explanation on one where is changes. Q2 ‘14 was $23.7 million and Q3 ‘13 was $23.9 million. Factors impacting the decrease to the $18.8 million is the Poland on the biomethanes; it moved into Q3 and then also the change in the FX translation coupled with just the issues with regards to how National Grid isn’t ordering this year-to-date, doing smaller orders and shorter project time lines. Bill Nasgovitz - Heartland Fund: Okay. Well, thank you. Good luck on some of these major orders and in the Gas segment.

Thanks. Yes.

Thank you. Our next question comes from the line of Morgan Frank of Manchester Management. Your line is open. Please go ahead.

Hi Morgan. Morgan Frank - Manchester Management: Just one quick -- most of my questions have been answered. One quick sort of housekeeping issue; what is the overall gross margin on the biomethanes skids? I know there is -- going to go carry a lower margin.

Sure. During the quarter they were in the low 20s and in high teens across them. The blend average is probably about 18% to 19% per margin on those. We are expecting that to improve during the fourth quarter somewhat, but that’s where they were for the third quarter. And that includes… Morgan Frank - Manchester Management: And in terms of where do you think they would be on a normalized basis, if you weren’t rushing to try to get them.

Yes, actually normalized basis, we picture those in the low 30s.

And actually Morgan, that’s where they’ll go back to next year, they’ll go into the 30s. That’s really why we’re pushing to get these projects out for these bigger companies, because we know they’re going to be doing more of them and we want to be the vendor of choice. So yes, that will move back in the low 30s. Morgan Frank - Manchester Management: Do you guys even have space to do 30 of these units next year?

Yes, that’s one of the things we’re looking at right now. We’ve talked about building a bigger facility on the site that we have in the UK and that’s something that we’re moving forward with. The designs have already been done. We are in the process of talking about financing and what not for that for now. So, it’s cogent point and we’re ahead of that.

And just to kind of give you a little picture of that. I was just over there this past month and went over to the manufacturing site, which was overflowing up to an including loading in one of the larger biomethane skids on to a flat semi truck. And it was good about getting moved out because there was a whole lot of skid going into the production facility that same day. So, it’s (inaudible) it seems right now. And that is something we’re working on. Morgan Frank - Manchester Management: Their worst problem to have…

Exactly. Morgan Frank - Manchester Management: Thanks.

Thank you.

Thank you. (Operator Instructions). Our next question comes from the line of Roger Liddell of Clear Harbor Asset Management. Your line is open. Please go ahead. Roger Liddell - Clear Harbor Asset Management: Thanks and good morning Bill and Dan.

Hi Roger. Roger Liddell - Clear Harbor Asset Management: Question I have is on the Mitsubishi turbine opportunity. My understanding is that with the PT system installed, the operator of that turbine can decrease the gas burn something like 5% or 6% because of the protective ability of the system. That’s a big number. So, the question is, do you foresee Mitsubishi incorporating it into existing fleet out there plus new ones and is my figure about right on the potential gas savings?

Yes. Your figure is just about right. And we are eager as you might imagine, Roger, to have Mitsubishi put these devices on their two test turbines. We’ve been very frustrated at the process of GE simply because GE is so big and so slow. Mitsubishi is much faster and much more interested in performance across the broader spectrum of gas as opposed to certain unique gas qualities. And I think I agree with you, I think when they see what we can do, it’s going to be quite exciting for them. We have been negotiating with them for such a long period of time only because as you may know, the Japanese culture just takes a long time to put contracts together and that’s what it’s been, it’s really been a system of putting the contract together and getting them in play. So that’s done now. And frankly, we’re eager to have them put these two devices on; we’re going to send a team out to install so that they go on just right. And we think they’re going to see significant increase in performance and a significant decrease in fuel usage, which of course is what they’re looking for. Roger Liddell - Clear Harbor Asset Management: And resulting drop and emissions also, isn’t that a big number?

Yes, exactly. They’re not as concerned about that frankly, as they would be in the U.S. for example. Emissions in Asia are much different deal, but they are very, very concerned about fuel usage and performance. Roger Liddell - Clear Harbor Asset Management: Another question regards the press release three weeks ago on the Institution of Engineering and Technology and their 2014 innovation awards, both VE and the PT are shortlisted for that, which to me is quite unusual if not extraordinary. Is that shortlist 5 or 10 or 50 or 100 and if the -- either of the technologies gets a big win doesn’t really matter?

It matters. Well, let me first answer your question. I think that there are 5 in one category and I think there are 8 in the other category. And I don’t know which is which, but there is 5 in one category and 8 in the other that we’re in. So, it is quite an elite group that we’re in right now. But it is, it’s a big deal for a couple of reasons that is a very, very respected European engineering group, it’s 140 years old I believe. And they are a group that people pay attention too. One of the things that we’re doing especially in Europe is we’re doing [white] papers, we’re doing a lot of behind the door kind of work at getting into the European markets. That’s how we ultimately got the Snam Rete and that’s how we got into National Grid. We did it because we were respected by their engineering team. It’s just another if you will badge of creditability particularly in Europe for the technologies. And it’s something that works especially well up in the Norway, up with Statoil for example. We believe it will be quite impressive and quite motivated for ConocoPhillips up in the North Sea. They’re talking about replacing all of their [progs] with our VE Technology. And again, it’s just another way that we can show that the technology is not only incredible, but is far advanced than anything else that’s out there. So, we’re hopeful that we’re going to see one if not both of those wins and even without that we are an elite company. Roger Liddell - Clear Harbor Asset Management: Okay. Thank you.

Thank you.

Thank you. And our final question today comes from the line of Gregory Macosko of Montrose Advisors. Your line is open. Please go ahead. Gregory Macosko - Montrose Advisors: Yes, thank you.

Hey Greg, how are you? Gregory Macosko - Montrose Advisors: Fine, fine. Just a couple of questions with regard to the orders that you mentioned on GasPT, you’ve delivered 26 year-to-date, did you mean 27 more are going to be delivered by the end of the year?

Yes. We’ve uptake purchase orders and have now one orders for 27 more that will be delivered by the end of the year. I don’t have the breakdown as to which are GasPTs and which are GasPTIs, but yes 27 more. Gregory Macosko - Montrose Advisors: That’s quite an acceleration then?

Well it is, but it’s still not the numbers we’re looking for. I mean frankly we’re not looking for 10s we’re looking for sales of 100s. And so yes, it is an acceleration. But again, what we’re looking for is the bigger orders and that’s really what we’re working hard to get. Gregory Macosko - Montrose Advisors: And then switching over to Snam Rete, the drop dead date that you mentioned was with regard to 1,500 units, is it conceivable that they could put in a very large order just around the time of drop dead date and could you match that?

Yes, we can build them; we’re already set up for that. Frankly, one of the things when we talk about building a new facility at the Stone land, part of it is to build -- to start building the GasPTIs at our own facilities. So, we could definitely -- we could deliver if we needed to. I don’t see that happening though. They really have working partnership with us. I see them making multi-hundred orders and I see them starting that, again, as I mentioned first quarter of 2015. They are not the kind of people who are going to drop a 1,500 unit order on us and say we need it next month or in six weeks. That’s not the way we work. They have been very open with us and have communicated. They’re just as I have mentioned in the past, there is just no urgency with them. They move at their own pace. But again, I’ve seen nothing that would indicate to me that they’re going to do anything on toward. They are partners with us. They like the technology, they like what it does and they want to adopt it across their system. I think in that regard, I feel that they will work with us. Gregory Macosko - Montrose Advisors: Okay. And then finally just with regard to the press release. You mentioned $738,000 of equity compensation for strategic consulting. Does that mean that you have some deals where it’s involving stock?

Yes, it was a deal which was announced in 8-K with the company called Relentless Ventures and it was a 100,000 shares which at the time was equivalent to $738,000 and it was for entry really at very highest levels with the Energy Transfer Partners. The Relentless has some incredible relationships at all levels of Energy Transfer Partners and it has to-date really paid off. It has not only allowed us to meet with ETP. And they have Kelcy Warren actually appoint a project manager for adoption of our technology. It’s also enhanced our relationship with GE Intelligent Platforms. So, again, it’s been -- I think it’s been quite worthwhile to-date. Gregory Macosko - Montrose Advisors: Okay, thanks very much.

Thank you, Greg.

Thank you. And we did receive one additional question from the line of Angus Burton of Marathon Capital Management. Your line is open. Please go ahead. Jim Kennedy - Marathon Capital Management: Hey Bill, Hey Dan; Jim Kennedy.

Hey Jim.

Hey Jim. How are you? Jim Kennedy - Marathon Capital Management: Hey. First of all, I just want to say, since it is Veterans Day, have a about cheer up for all those folks who have served our country unselfishly over the years?

Absolutely Jim, very nice thought. Jim Kennedy - Marathon Capital Management: Secondly, and I think I mentioned this in the last call Bill. I think it would be helpful going forward if you could provide perhaps delineate where these PT2 gas sales, if you will, are in terms of where they are in the chain. So how many are with distributors, how many of those are actually in field trials and then how many have been purchased by actual end customers? And I think that will give you some metrics going forward on which to kind of judge market adoption.

Yes Jim. Just so, I’m clear, maybe I haven’t been so clear. All I’m reporting now is end user purchases. That’s all we’re reporting. So everything you’re getting is end user purchases. I didn’t define it by geography. Although I’ll say you that I think most of these are European sales but the bottom line is that’s all I’m reporting. We’re only reporting now end user sales. We’re not reporting any distributor sales, we’re not reporting -- we have a number frankly of distributor inventory sales, but we’re not reporting those anymore. All you’re getting now is end users actually purchasing the devices. Jim Kennedy - Marathon Capital Management: And I appreciate that. That’s a useful number. I think it would also be helpful in the long run though to see how many are being purchased by distributors and then if you have access to the information, how many of those are in turn are in field trials?

All right. Sure that’s the thing we can put together. Jim Kennedy - Marathon Capital Management: Okay. Thanks a lot guys. Good quarter.

Thanks Jim.

Thank you. And ladies and gentlemen, it does conclude our Q&A session. I’d like to hand the conference back over to Mr. Bill Clough for any closing remarks.

Just in closing again, I want to compliment the entire staff and employee base at CUI Global and at obviously our subsidiary, CUI, Inc. and Orbital. It was a really fantastic quarter and that’s a team effort. And those people did a great job. And as I’ve said before and I’ll say again, we are working hard to deliver a return on investment for our investors and for our employees and we will continue to do that. I want to thank all of you for your attendance and for your continued support. Thank you much. And that’s the end of our call.

Ladies and gentlemen, thank you for your participating in today’s conference. This does conclude the program and you may all disconnect. Have a great rest of your day.