Good day and welcome to the Inuvo, Inc. 2014 Full Year and Fourth Quarter Conference Call. Today’s conference is being recorded. At this time, I would like to turn the conference over to Mr. Alan Sheinwald of Capital Markets Group, LLC. Please go ahead, sir.

Thank you, operator, and good afternoon. I’d like to thank everyone for joining us today for the Inuvo fourth quarter and full year 2014 shareholders update conference call. Today Mr. Richard Howe, Chief Executive Officer; and Mr. Wally Ruiz, Chief Financial Officer of Inuvo will be your presenters on the call today. Before we begin, I’m going to review the company’s Safe Harbor Statement. The statements in this conference call that are not descriptions of historical facts are forward-looking statements relating to future events and as such all forward-looking statements are made pursuant to the Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties and actual results may differ materially. When used in this call the words anticipate, could, enable, estimate, intend, expect, believe, potential, will, should, project and similar expressions as it relates to Inuvo, Inc. are such forward looking statements. Investors are cautioned that all forward-looking statements involve risks and uncertainties which may cause actual results to differ from those anticipated by Inuvo at this time. In addition, other risks are more fully described in the Inuvo’s public filings with the U.S. Securities and Exchange Commission, which can be reviewed at www.sec.gov. With that out of the way, now I’d like to congratulate management on an outstanding year and fourth quarter and turn the call over to Mr. Richard Howe, CEO of Inuvo. Rich the floor is all yours.

Thank you, Alan, and thanks everyone for joining us today. We are very pleased to be announcing strong quarterly and full-year results. Revenue in the fourth quarter was $15.5 million, up 36% from $11.4 million in the fourth quarter of 2013, and up 19% sequentially from $13 million in the third quarter of 2014. Gross margins in the fourth quarter experienced a healthy growth reaching 60% as compared to 46% last year and net income on a GAAP basis in the quarter was $645,000 or $0.03 a share versus a loss of $253,000 a year ago. For the full year, revenue was $49.6 million having steadily grown at a 15% compounded quarterly growth rate throughout the year starting with $10.1 million in the first quarter and ending with $15.5 million in the fourth quarter. Gross margin for the year was 59% and net income on a GAAP basis for the year was $2.9 million, or $0.09 per share, the best we’ve ever delivered. Wally Ruiz, our CFO, will be sharing additional details about our financial performance shortly. But the bottom line is we’ve had a terrific year on every front both financially and operationally. Let me share some of our successes with you for each segment of the business starting with the owned and operated segment. This segment is now almost exclusively our digital publishing business as two of our revenues are no longer material to our results. The websites and apps contribution to this segments growth has been nothing short of remarkable. Our business that effectively did not exist less than 24 months ago delivered almost $22 million in profitable revenue in 2014, $7.7 million of which was in the fourth quarter. During that fourth quarter, we continue to build off the numerous site enhancements. We had been making…

Thank you, Rich. Good afternoon everyone. We are reporting today another consecutive quarter of revenue growth, and as Rich mentioned, we have grown 15% quarter-over-quarter throughout 2014. Throughout my presentation when I refer to the current year, I’m referring to 2014 and when I refer to last year or the prior year, I’m referring to 2013. Inuvo reported revenue of $15.5 million in the fourth quarter of 2014 compared to $11.4 million in the fourth quarter of last year, a 36% increase. $7.6 million came from the partner network and $7.9 million from the owned and operated network. For the full year 2014, Inuvo reported revenue of $49.6 million, compared to $55 million last year. The partner network which delivers advertisements to our partner’s websites and applications reported $7.6 million in the fourth quarter of this year, seven tenths of a percent lower than the same quarter last year. For the full year 2014, the partner network reported revenue of $25.7 million, compared to $35.9 million in 2013. The lower revenue in the partner network in 2014 compared to the same periods of 2013 is due largely to the program we initiated in the fourth quarter of 2013 that was designed to improve overall traffic quality through the deployment of technology and the enforcement of our policies related to the use of technology on publishers’ pages and apps. The result of these changes was a lower click volume compared to the prior year, but higher quality of traffic delivered to our customer and a higher RPC or revenue per click for ourselves. The partner network revenue in the fourth quarter of 2014 would have exceeded the prior year, but for a decision this year to implement the sales allowance policy to address any advertiser adjustments that may occur from time…

Thanks, Wally. In summary, we had a terrific fourth quarter and full year in 2014. We entered 2014 at financially and operationally sound as we’ve ever been. But let me explain why Inuvo can compete so effectively in the digital advertising marketplace. We have three integrated assets that together can yield strong growth and margins. We own our own content. We do not have to license it or pay a fee for it and it can be reused as many times as we can’t imagine. We own our own technology and we do our own ad survey. It is programatic and targeted, yielding better click-throughs for ourselves and our partner. We do our own marketing. This complicated data-driven expertise is not outsourced and not easy to replicate its scale. Our campaigns are developed and monitored in-house. In closing, let me summarize our yield. Both segments of the business had double digit growth between Q1 and Q4. With the overall business growing 15% quarterly in 2014 from $10.1 million in Q1 to $15.5 million in Q4. Fourth quarter revenue was 36% higher than the previous year. The company delivered $49.6 million of revenue with the 59% gross margin and earnings per share of $0.09. The Owned & Operated Segment grew 114% in 2014, with the sites and apps revenue growing 200% to almost $22 million in the year. Adjusted EBITDA margin was a very healthy 11% at the year-end, with $3.7 million of cash and a debt down by $2.5 million to $3.6 million. With an unused bank availability of $3.1 million. And finally, revenue from mobile sources in the second half of year was steady at about 50% of total sales up, from 15% at the beginning of the year. We’re excited about 2015. Our three-year plan for renewal was to stabilize the business in 2013, to prove out the model in 2014 and to invest in growth for 2015. We are on track. Expect us to continue building out our Digital Publishing business and to maintain the course on a strategy to leverage these owned assets as a means to develop sophisticated ad units that can be distributed to others. With that, I’d like to now turn the call over the operator for questions. Operator.

[Operator Instructions] I will hear first from Eric Martinuzzi with Lake Street Capital Markets.

Thanks and congratulations on our strong finish to a transformative year. The Partner versus O&O mix, we came out of Q4 right now about 51% on the O&O side, obviously O&O growth has been pretty substantial versus the year-ago where it was in the minority of the revenue stream. As you look at 2015, what is the mix, is that same kind of fifty-fifty that we saw here in Q4 or does that shift more to be O&O side?

Thanks Eric. We said before and I guess I’ll try and restate it again. We really feel good about both segments of our business, clearly O&O business has grown much more quickly than the partner segment has but it also was zero not 24 months ago. So now that it’s caught up. We see equal opportunity for growth in both of these segments of the business right now.

Okay. And then staying with the O&O side here, you talked about some new formats inside the content things like informational, tradeshows, short answer, Q&A format that sort of thing. Where are we now like – is written still 95% plus of what you’re monetizing and the other stuffs in the – just barely starting to be material and then again kind of where does this head over time?

Yes, so I don’t know what the exact percentage is Eric, so I don’t know if it is 90 or 80, but we definitely have been already introducing some of the other formats into the various stages. But yes, the lion’s share to this point has been the written content format. So we’re pretty excited about these new choices. And we have been implementing – no, no we are starting to see some really nice engagement with them. Videos should be big thing for us too this year.

Okay. And then stepping down to the gross margins, historically I think Wally you’ve talked about 52% to 55% range obviously this quarter you were slightly over 60%. Again I understand the margin profile when you do have a good strong O&O quarter. But as we look at 2015, it seems like 52% to 55% is probably understating the gross margin profile of the business now. What’s the correct range in your mind?

Yes. I think you’re right. Actually I think we’ll be in the mid 50s to – the high 50s. I think we’ve moved up a couple of steps.

Okay. And then lastly on the Google contract renewal, I know there is [indiscernible] can’t share, but I’m hoping you can talk to maybe how that arrangement change? What are the areas of emphasis with your key partner there because I imagine this every two years is kind of a chance for them to revisit. And as they go after their own partner network, they being Google, the kinds of things that they’re looking for from you I think it can be – it can tell us sort of where things are headed with your own business or maybe where the things are headed with your other large partner. What are the things that are emphasizing, what they want more out from you, what they want less out from you?

Yes, so I’ll take a shot of this. So I'm hard-pressed to speak for Google, but clearly we do meet with them on a regular basis, because we have been long-standing partners. And what I can say is they’ve been pleased with the way we transitioned from the downloadable software toolbar business into really a pretty large digital publisher now. So that we just met with them couple of weeks back. So they are very pleased with what we are doing there and there is a whole host of other services that Google has that we could leverage in the future that we could try and so, we plan to do it much of that as we can. Specifically, for the contract, you are quite right here we don’t comment on the specifics of our contract as we consider that a competitive issue. And what I will say is generally, the contract year-over-year doesn't change on average much. So there are parts of the contract that we might benefit from in a new version and there are other parts where we might have lost something. But generally it tends to average sells out. That’s why I think even in the press release I’d said look at the contractors, the business as usual.

Okay. Thanks and congrats again on the strong Q4.

Thank you, Eric.

We’ll move next John Gilliam with Point Clear Strategic Capital.

Hey Rich, what a great job guys, you [indiscernible] this quarter, great job.

Thanks, John.

It looks like we are running probably between $1 million and $2 million in the EBITDA per quarter for fairly consistently now. We have been - appears we’ve been reducing the debt magically each quarter. I'm curious will that be the focus going forward at any point where we start to buyback shares instead of reducing the debt? Just want to get your idea of where we will be with that going forward.

Yes, I don’t see as using our capital to purchase back our shares. We think there is a higher return on investment for shareholders through the investment of the business, particularly now that the business is - is sound and performing, as well as it ever has in the past. So I wouldn’t expect us to do that, rather I would expect just to come into 2015 with a platform that we’ve now proven has the ability to scale and make all the investments we need to realize the full potential of this platform.

Great, thank you. You shared some of the growth figures in the O&O for the organic traffic, but could you give us an idea and let me prophecies with understanding that that several sites have not even been around long enough to be fully indexed in the search engines and sites. So to have that kind of organic growth is fantastic, but I just curious overall for the full year or rather just for the fourth quarter, what percentage of our overall owned and operated traffic was organic?

We don’t disclose that and I’m not prepared to do it yet, John. And by the way you shouldn’t take to mean because it’s too small to want to. Just its one of those metrics that once we start throwing out there – we’re going to have to track with everybody over and over again. And we just don’t think that’s necessary to do it now, which is why I want to give people an indication that why we’re focused on it.

Yes.

We know the impact it has on our business and if shareholders don’t understand the impact it has on our business, I will say it for you John, but because I know you know, look organic traffic improve the margins.

Sure.

It’s as simple as that because you’re not pay for return visitor. So I would say in the last part of 2014, we started to make a lot of changes related to the engagement of users, the redesign of the site, purposefully to begin to accelerate the percentage, the overall percentage of traffic that comes from organic. And as you can tell from the numbers I gave, we’re starting to see some nice impact from that. And we will continue to focus on that throughout 2015, now that we have the size of an audience that we do.

Yes, absolutely and obviously the focus you guys have made on generating the quality, the higher quality content is obviously starting to pay dividends with the most the increased time of the visitors are spending on the site, to see even more pages and all of that - great job, fantastic quarters, keep up the good work, thanks guys.

Thanks John.

[Operator Instructions] We’ll move next to Jay Eisen with Gotham Travel [ph].

Great quarter guys. Have you given any guidelines for next year or just next quarter?

Hi, Jay. It’s Wally. How are you?

I'm don’t know – Gotham Travel but okay, it’s…

So Jay, we had not given any specific guidance up to now, but what we do is we talk about trends and the trending in the business and where we think its going. So I try to give some indications about the operating expenses.

I understand [indiscernible]

I appreciate it. Thank you.

Okay.

We will take our next question from George Melas with MKH Management.

Hi, Rich. Hi, Wally. Great job this year. Could you give us any indication on the maturity of your different owned and operated types?

Okay, boy, now you’re going to test our memory. I guess if you think we would know that’s 20, 24 months old, right.

The oldest one…

So the oldest site we lunched, the very first site we launched was the local site and that was I guess probably 20 months ago or so right, give or take. And the next site we launched probably was the health site.

Health site, that’s right.

And that would have been – I don’t know maybe 16 months ago, so going back in time…

Yes.

That was followed by the finance site couple months later, so…

14 or 12 months…

Those were all 2013.

Yes. And then we followed that up with careers I think it was [indiscernible] career is 2014 and then there was…

Travel…

Travel and then living…

Excuse me, could you tell us how well those six sites are maturing? Which one is sort of hitting your model that you have for them and which one not quite there and maybe get there at some point?

Well, so – not surprisingly the one that were last in the Q were the smallest contributor to growth. I don’t think we have any of our sites that we’re not pleased with the performance of. And not surprisingly the first two sites we launched are the ones that are generating a big part of the overall revenue for the business. So we feel good about them all. So we like all of our babies. If I could say at that way right now and we see the opportunity to expand content and growth in each of the verticals that we’ve selected.

And the other thing George is that the some of sites support other sites. So it’s really a family of sites. So when you get someone that lands on let’s say the health site, they may end up ultimately on the finance or living site. So it’s a – we’re starting to look at it as a portfolio of sites because of that interrelation between them and the support between the site.

Okay, okay. And then just on the mix between website and mobile, it seems to have at least temporarily stabilized at 50:50. Is that what you’re aiming for? Or do you think that would change in 2015?

Well, we actually didn’t think we would get to 50% by the end of 2014. So we actually did better than we had expected coming end of the year. But I do think the 50 number is a good split right now. Now, market dynamics themselves are going to impact that that split, right. I mean there is just no doubt that consumers increasingly are accessing the internet through either their tablets or their cellphones and they’re just does not seem to be any indication that that’s going to slowdown. But 50:50 seems good because people are still on the desktop, they still want to use the desktop – home. And so, I would expect us to stay in that 50:50 range. If anything it will go up on the mobile, but it’s probably going hang around 50:50 for a while.

Okay, great. Thank you very much.

You bet. Thanks, George.

[Operator Instructions] At this time, there are no additional questions. I’d like to turn the conference back over to Mr. Howe for any additional or closing remarks.

Thank you, operator. I’d like to thank everyone, who joined us on the call today. We appreciate your continued interest in Inuvo and we look forward to reporting progress over the coming quarters.

That does conclude today’s conference. Thank you for your participation.