by Luke Jones
Posted 9/30/2013 12:00 am
Updated 12 months ago
Inuvo Inc. has been in a pinch with the New York Stock Exchange for almost a year. Now, it’s making progress in getting back in the exchange’s good graces.
A release in September announced that the Conway Internet marketing company has been given until April 24 to prove itself worthy of staying on the NYSE charts.
The small yet publicly traded company has been in the doghouse for at least 10 months. “We were notified in November of last year that we were out of compliance with listing standards,” said CFO Wallace Ruiz.
In particular, stockholder equity was less than $6 million and the company had posted net losses in its five most recent fiscal years.
“So they said, ‘If you give us a plan on how you can regain compliance, and it looks reasonable, we can give you additional time,’” Ruiz said.
He said Inuvo developed a plan and submitted it to the NYSE in December.
“In February of this year, they approved it,” Ruiz said. “The plan was essentially how we would grow revenue and margins.”
He said the plan involved shifting Inuvo’s primary product from browser toolbars to owned and operated websites, which Ruiz said made profits faster and easier.
“They had a lower cost and a faster turnaround,” he said.
In September, the company announced the launch of Alot Health, an addition to the company’s existing Alot website.
“We didn’t do this specifically to meet the listing standards of the New York Stock Exchange,” Ruiz said, “but, yes, it’s part of the whole revenue growth plan to meet the exchange requirements.”
According to a news release, the addition introduces Health.Alot.com, which features information on ailments, fitness, dieting and pregnancy. It also serves as a directory for searching out local physicians.
The release notes that Inuvo intends to launch several more websites centering on the Alot brand.
“We’ve had a stated goal to increase the number of owned and operated websites and capitalize on the growing volume of traffic being generated through mobile devices,” COO Trey Barrett said in the release. “This and subsequent launches address both of these goals while also servicing the information needs of our Alot users.”
The NYSE plan also included reducing the company’s operating costs.
“A big piece, no doubt, was our relocation to Arkansas,” Ruiz said.
In January, the company condensed its locations from scattered offices in New York, Florida and overseas to a single headquarters in Conway.
The last part of the plan, Ruiz said, was moving Richard Howe to the CEO position.
When Ruiz and Howe explained the plan to the exchange, Inuvo was given until Dec. 2, 2013, to make it work. The NYSE would monitor the company each quarter to see if it was working.
Evidently it has. Inuvo posted net income of $381,572 on revenue of $13.1 million in its second quarter for 2013. It had a loss of $3 million on $12.8 million revenue in the same quarter of 2012.
So this month the NYSE decided to extend its deadline so it could see the company’s results as a yearly retrospective.
“They came back and said ‘nice job,’” Ruiz said. “They said they would like to extend the time from Dec. 2 to April 24, since they would like to see how we do in our fourth quarter also.”
Ruiz said he’s not at all concerned about meeting the NYSE standards. He noted that once net income for the company became positive, the equity threshold dropped from $6 million to $4 million, which Ruiz said the company was “well over” already.
“To tell you the truth, we’re going to make the $6 million anyway,” he said. “We’re feeling pretty confident about meeting the listing standards and coming back to compliance.”