Business Wire | Apr 29, 2021 09:30AM EDT

CCOM Group, Inc. Reports 2020 Results

Apr. 29, 2021

HAWTHORNE, N.J.--(BUSINESS WIRE)--Apr. 29, 2021--CCOM Group, Inc. ("CCOM") (OTC Pink: "CCOM," "CCOMP"), announced its financial results for the year ended December 31, 2020.

Results for the year ended December 31, 2020 compared to results for the same period in 2019:

* Sales decreased 10.3% to $101,936,300 from $113,701,032 * Gross profit decreased 9.7% to $26,213,512 from $29,016,775 * Selling, general and administrative expenses decreased 6.7% to $24,600,667 from $26,375,014 * Operating income decreased 38.9% to $1,612,845 from $2,641,761 * Net income decreased 19.4% to $1,053,885 from $1,308,234; the 2020 amount includes a $250,425 non-cash income tax expense and the 2019 amount includes a $596,000 non-cash income tax expense * Net income per share on a fully diluted basis decreased to $0.11 per share from $0.13 per share

About CCOM Group, Inc.

CCOM Group, Inc. ("CCOM") distributes heating, ventilating and air conditioning equipment (HVAC), parts and accessories, whole-house generators, climate control systems, and plumbing and electrical fixtures and supplies, primarily in New Jersey, New York, Massachusetts and portions of eastern Pennsylvania, Connecticut and Vermont through its subsidiaries: Universal Supply Group, Inc., www.usginc.com, The RAL Supply Group, Inc., www.ralsupply.com, and S&A Supply, Inc., www.sasupplyinc.com. CCOM is headquartered in New Jersey, and, with its affiliates, operates out of 15 locations in its geographic trading area. For more information on CCOM's operations, products and/or services, please visit www.ccom-group.com.

For further information, please contact Peter D. Gasiewicz, Chief Executive Officer, or William Salek, Chief Financial Officer, at (973) 427-8224.

(Financial Highlights Follow)

CCOM GROUP, INC. AND SUBSIDIARIESConsolidated Balance Sheets December 31, December 31, 2020 2019

Assets

Current assets:Cash $ 388,267 $ 193,448

Accounts receivable, net of allowance for doubtful 10,305,665 11,260,382accounts of $766,459 and $557,532, respectivelyInventory 20,936,936 17,858,956

Prepaid expenses and other current assets 749,053 973,961

Total current assets 32,379,921 30,286,747

Property and equipment 1,095,506 1,009,524

Goodwill 1,416,929 1,416,929

Other assets - noncurrent 188,824 356,788

Deferred tax asset - noncurrent 2,548,575 2,799,000

$ 37,629,755 $ 35,868,988

Liabilities and Stockholders' Equity

Current liabilities:Borrowings under credit facility - revolving credit $ 9,151,368 $ 12,395,838

Notes payable - current portion 627,009 107,776

Trade payables 5,892,126 4,128,135

Accrued liabilities 2,450,810 2,657,118

Income taxes payable 2,850 24,625

Total current liabilities 18,124,163 19,313,492

Notes payable, excluding current portion 2,247,742 351,531

Deferred tax liability - noncurrent 354,000 354,000

Total liabilities 20,725,905 20,019,023

Commitments and contingenciesStockholders' equity:Redeemable convertible preferred stock, $.05 parvalue, 2,500,000 shares authorized, 284,612shares issued and outstanding, liquidation 14,231 14,231preference of $1,423,060Common stock, $.05 par value, 20,000,000 sharesauthorized,9,154,928 shares issued and outstanding 457,746 457,746

Additional paid-in capital 12,596,853 12,596,853

Retained Earnings 3,835,020 2,781,135

Total stockholders' equity 16,903,850 15,849,965

$ 37,629,755 $ 35,868,988

CCOM GROUP, INC. AND SUBSIDIARESConsolidated Statements of IncomeFor the Years EndedDecember 31,2020

2019

Sales$101,936,300

$113,701,032

Cost of sales75,722,788

84,684,257

Gross profit26,213,512

29,016,775

Selling, general and administrative expenses, net24,600,667

26,375,014

Operating income1,612,845

2,641,761

Other income219,067

226,497

Interest expense, net; includes related party interest of$0 and $34,503, respectively(370,455)

(748,440)

Income before income tax expense1,461,457

2,119,818

Income tax expense407,572

811,584

Net income$1,053,885

$1,308,234

Income per common share:Basic$ 0.11

$ 0.14

Diluted$ 0.11

$ 0.13

Weighted average sharesoutstanding:Basic9,154,928

9,154,928

Diluted9,439,540

9,439,540

CCOM GROUP, INC. AND SUBSIDIARESConsolidated Statements of Income For the Years Ended December 31, 2020 2019

Sales $ 101,936,300 $ 113,701,032

Cost of sales 75,722,788 84,684,257

Gross profit 26,213,512 29,016,775

Selling, general and administrative expenses, 24,600,667 26,375,014netOperating income 1,612,845 2,641,761

Other income 219,067 226,497

Interest expense, net; includes related partyinterest of$0 and $34,503, respectively (370,455) (748,440)

Income before income tax expense 1,461,457 2,119,818

Income tax expense 407,572 811,584

Net income $ 1,053,885 $ 1,308,234

Income per common share:Basic $ 0.11 $ 0.14

Diluted $ 0.11 $ 0.13

Weighted average sharesoutstanding:Basic 9,154,928 9,154,928

Diluted 9,439,540 9,439,540

CCOM GROUP,INC. AND SUBSIDIARIESConsolidated Statements of Stockholders' EquityFor The Year Ended December 31, 2020 and 2019Number of sharesRedeemableConvertiblePreferredStockCommonStockRedeemableConvertiblePreferredStockCommonStockAdditionalPaid-InCapitalRetainedEarnings /AccumulatedDeficitTotalStockholders'EquityBalance at December 31, 2018284,612

9,154,928

$

14,231

$

457,746

$

12,596,853

$

1,472,901

$

14,541,731

Net Income1,308,234

1,308,234

Balance at December 31, 2019284,612

9,154,928

$

14,231

$

457,746

$

12,596,853

$

2,781,135

$

15,849,965

Net Income1,053,885

1,053,885

Balance at December 31, 2020284,612

9,154,928

$

14,231

$

457,746

$

12,596,853

$

3,835,020

$

16,903,850

CCOM GROUP,INC. AND SUBSIDIARIESConsolidated Statements of Stockholders' EquityFor The Year Ended December 31, 2020 and 2019 Number of shares Redeemable Redeemable Additional Retained Total Convertible Common Convertible Common Paid-In Earnings / Stockholders' Preferred Stock Preferred Stock Capital Accumulated Equity Stock Stock Deficit

Balanceat 284,612 9,154,928 $ 14,231 $ 457,746 $ 12,596,853 $ 1,472,901 $ 14,541,731December31, 2018 Net 1,308,234 1,308,234IncomeBalanceat 284,612 9,154,928 $ 14,231 $ 457,746 $ 12,596,853 $ 2,781,135 $ 15,849,965December31, 2019 Net 1,053,885 1,053,885IncomeBalanceat 284,612 9,154,928 $ 14,231 $ 457,746 $ 12,596,853 $ 3,835,020 $ 16,903,850December31, 2020 CCOM GROUP, INC. AND SUBSIDIARIESConsolidated Statements of Cash FlowsFor The Years EndedDecember 31,2020

2019

Cash flows from operating activities:Net income$1,053,885

$1,308,234

Adjustments to reconcile net income to net cashprovided by operating activities:Deferred income tax expense250,425

596,000

Provision for doubtful accounts288,924

295,476

Depreciation and amortization414,212

319,042

Net gain on sale of property and equipment(12,851)

(13,279)

Changes in operating assets and liabilitiesAccounts receivable665,793

(170,901)

Inventory(3,077,980)

881,454

Prepaid expenses and other current assets224,908

72,200

Other assets - noncurrent167,964

114,390

Trade payables1,763,991

(1,526,876)

Accrued liabilities(206,308)

177,562

Income taxes payable(21,775)

23,910

Net cash provided by operating activities1,511,188

2,077,212

Cash flows from investing activities:Additions to property and equipment(254,711)

(468,609)

Proceeds from disposal of property and equipment21,600

37,000

Net cash used in investing activities(233,111)

(431,609)

Cash flows from financing activities:Repayments of notes payable: includes related partyrepayments of $0 and $600,335 respectively(124,044)

(678,924)

Proceeds from PPP loans2,285,256

Repayments of short term financing, related party-

(500,000)

Issuance of short term financing, related party-

500,000

Repayments under credit facility - revolving credit, net(3,244,470)

(1,080,703)

Net cash used in financing activities(1,083,258)

(1,759,627)

Increase/(decrease) in cash194,819

(114,024)

Cash - beginning of period193,448

307,472

Cash - end of period$388,267

193,448

View source version on businesswire.com: https://www.businesswire.com/news/home/20210429005068/en/

CONTACT: Peter D. Gasiewicz, Chief Executive Officer William Salek, Chief Financial Officer (973) 427-8224.