Business Wire | Aug 12, 2021 09:04AM EDT

CCOM Group, Inc. Reports 2021 Second Quarter Results

Aug. 12, 2021

HAWTHORNE, N.J.--(BUSINESS WIRE)--Aug. 12, 2021--CCOM Group, Inc. ("CCOM") (OTC Pink: "CCOM," "CCOMP"), announced its financial results for the quarter and six months ended June 30, 2021.

Results for the quarter ended June 30, 2021 compared to results for the same period in 2020:

* Sales increased 37.5% to $36,682,668 from $26,685,479 * Gross profit increased 47.0% to $9,796,106 from $6,663,143 * Selling, general and administrative expenses increased 24.4% to $6,915,940 from $5,560,415 * Operating income of $2,844,389 compared to $1,093,954 * Net income of $2,580,346 compared to $931,921; the 2021 and 2020 amounts each include a $158,333 non-cash deferred income tax expense (with a corresponding decrease to CCOM's deferred tax asset). * Net income per share on a fully diluted basis increased to $0.27 per share from $0.10 per share

Results for the six months ended June 30, 2021 compared to results for the same period in 2020:

* Sales increased 19.7% to $58,765,528 from $49,094,282 * Gross profit increased 26.1% to $15,855,960 from $12,577,654 * Selling, general and administrative expenses increased 6.9% to $12,907,652 from $12,072,912 * Operating income of $2,877,077 compared to $420,869 * Net income of $2,594,185 compared to $243,770; the 2021 and 2020 amounts each include a $158,333 non-cash deferred income tax expense (with a corresponding decrease to CCOM's deferred tax asset). * Net income per share on a fully diluted basis increased to $0.27 per share from $0.03 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 SUBSIDIARIESCondensed Consolidated Balance Sheets June 30, December 31,

2021 2020

(Unaudited)

Assets

Current assets:Cash $ 419,461 $ 388,267

Accounts receivable, net of allowance for doubtful 14,231,328 10,305,665accounts of $616,130 and $766,459, respectivelyInventory 24,385,217 20,936,936

Prepaid expenses and other current assets 705,570 749,053

Total current assets 39,741,576 32,379,921

Property and equipment 1,426,119 1,095,506

Goodwill 1,416,928 1,416,929

Other assets - noncurrent 517,083 188,824

Deferred tax asset - noncurrent 2,390,242 2,548,575

$ 45,491,948 $ 37,629,755

Liabilities and Stockholders' Equity

Current liabilities:

Borrowings under credit facility - revolving $ 13,227,105 $ 9,151,368creditNotes payable - current portion 1,206,549 627,009

Trade payables 6,159,163 5,892,126

Accrued liabilities 3,385,642 2,450,810

Income taxes payable 510 2,850

Total current liabilities 23,978,969 18,124,163

Notes payable, excluding current portion 1,660,944 2,247,742

Deferred tax liability - noncurrent 354,000 354,000

Total liabilities 25,993,913 20,725,905



Commitments and contingencies

Stockholders' equity:

Redeemable convertible preferred stock, $.05 parvalue, 2,500,000 shares authorized, 284,612 shares 14,231 14,231issued and (Repayments) borrowings under creditfacility - revolving credit, netCommon stock, $.05 par value, 20,000,000 shares 457,746 457,746authorized, 9,154,928 shares issued andoutstandingAdditional paid-in capital 12,596,853 12,596,853

Retained earnings 6,429,205 3,835,020

Total stockholders' equity 19,498,035 16,903,850

$ 45,491,948 $ 37,629,755

The accompanying notes are integral part of these condensed consolidatedfinancial statements.CCOM GROUP, INC. AND SUBSIDIARIESCondensed Consolidated Statements of Operations(Unaudited)For The Three Months Ended

For The Six Months Ended

June 30,

June 30,

2021

2020

2021

2020

Sales$

36,682,668

$

26,685,479

$

58,765,528

$

49,094,282

Cost of sales26,886,562

20,022,336

42,909,568

36,516,628

Gross profit9,796,106

6,663,143

15,855,960

12,577,654

Selling, general and administrative expenses6,915,940

5,560,415

12,907,652

12,072,912

Operating income2,880,166

1,102,728

2,948,308

504,742

Other income56,401

78,884

97,598

135,338

Interest expense, net(92,178

)

(87,658

)

(168,829

)

(219,211

)

Income from operations2,844,389

1,093,954

2,877,077

420,869

Income tax expense264,043

162,033

282,892

177,099

Net income$

2,580,346

$

931,921

$

2,594,185

$

243,770

Income per common share:Basic$

0.27

$

0.10

$

0.27

$

0.03

Diluted$

0.27

$

0.10

$

0.27

$

0.03

Weighted average shares outstanding:Basic9,154,928

9,154,928

9,154,928

9,154,928

Diluted9,439,540

9,439,540

9,439,540

9,439,540

The accompanying notes are integral part of these condensed consolidated financial statements. CCOM GROUP, INC. AND SUBSIDIARIESCondensed Consolidated Statements of Operations(Unaudited) For The Three Months Ended For The Six Months Ended

June 30, June 30,

2021 2020 2021 2020

Sales $ 36,682,668 $ 26,685,479 $ 58,765,528 $ 49,094,282

Cost of sales 26,886,562 20,022,336 42,909,568 36,516,628

Gross profit 9,796,106 6,663,143 15,855,960 12,577,654



Selling,general and 6,915,940 5,560,415 12,907,652 12,072,912 administrativeexpensesOperating 2,880,166 1,102,728 2,948,308 504,742 income

Other income 56,401 78,884 97,598 135,338

Interest (92,178 ) (87,658 ) (168,829 ) (219,211 )expense, netIncome from 2,844,389 1,093,954 2,877,077 420,869 operations

Income tax 264,043 162,033 282,892 177,099 expenseNet income $ 2,580,346 $ 931,921 $ 2,594,185 $ 243,770



Income per common share:Basic $ 0.27 $ 0.10 $ 0.27 $ 0.03

Diluted $ 0.27 $ 0.10 $ 0.27 $ 0.03



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

Diluted 9,439,540 9,439,540 9,439,540 9,439,540

The accompanying notes are integral part of these condensed consolidatedfinancial statements.CCOM Group, Inc.Consolidated Statements of Stockholders' EquityFor Six Months Ended June 30, 2021(Unaudited)Number of shares

Redeemable

Convertible

Preferred Stock

Common

Stock

Redeemable

Convertible

Preferred Stock

Common

Stock

Additional Paid-In

Capital

Accumulated

Deficit

Total

Stockholders'

Equity

Balance at December 31, 2020284,612

9,154,928

$

14,231

$

457,746

$

12,596,853

$

3,835,020

$

16,903,850

Net Income-

-

-

-

-

13,839

13,839

Balance at March 31, 2021284,612

9,154,928

$

14,231

$

457,746

$

12,596,853

$

3,848,859

$

16,917,689

Net Income2,580,346

2,580,346

Balance at June 30, 2021284,612

9,154,928

$

14,231

$

457,746

$

12,596,853

$

6,429,205

$

19,498,035

The accompanying notes are integral part of these condensed consolidated financial statements. CCOM Group, Inc.Consolidated Statements of Stockholders' EquityFor Six Months Ended June 30, 2021(Unaudited) Number of shares

Redeemable Redeemable Total Common Common Additional Accumulated Convertible Convertible Paid-In Stockholders' Stock Stock Deficit Preferred Preferred Capital Equity Stock Stock

Balanceat 284,612 9,154,928 $ 14,231 $ 457,746 $ 12,596,853 $ 3,835,020 $ 16,903,850December31, 2020 Net - - - - - 13,839 13,839IncomeBalance 284,612 9,154,928 $ 14,231 $ 457,746 $ 12,596,853 $ 3,848,859 $ 16,917,689at March31, 2021 Net 2,580,346 2,580,346IncomeBalance 284,612 9,154,928 $ 14,231 $ 457,746 $ 12,596,853 $ 6,429,205 $ 19,498,035at June30, 2021 The accompanying notes are integral part of these condensed consolidatedfinancial statements.CCOM GROUP, INC. AND SUBSIDIARIESCondensed Consolidated Statements of Cash Flows(Unaudited)For The Six Months Ended

June 30,

2021

2020

Cash flows from operating activities:Net income$2,594,185$243,770Adjustments to reconcile net income to net cash used in operating activities:Deferred income taxes158,333158,333Provision for doubtful accounts(45,632)

214,436Depreciation234,212201,283Net gain on sale of property and equipment(5,200)

(2,000)

Changes in operating assets and liabilitiesAccounts receivable(3,880,031)

(1,666,269)

Inventory(3,448,281)

495,411Prepaid expenses and other current assets43,483182,241Other assets - noncurrent(328,259)

66,442Trade payables267,037(462,642)

Accrued liabilities934,832(673,564)

Income taxes payable(2,340)

(8,000)

Net cash used in operating activities(3,477,661)

(1,250,559)

Cash flows from investing activities:Additions to property and equipment(495,797)

(200,923)

Proceeds from disposal of property and equipment5,2002,000Net cash used in investing activities(490,597)

(198,923)

Cash flows from financing activities:Repayments of notes payable(76,285)

(54,113)

Issuance of financing-2,285,256Borrowings (repayments) under credit facility - revolving credit, net4,075,737(453,686)

Net cash provided by financing activities3,999,4521,777,457Increase in cash31,194327,975Cash - beginning of period388,267193,448Cash - end of period$419,461$521,423The accompanying notes are integral part of these condensed consolidated financial statements. View source version on businesswire.com: https://www.businesswire.com/news/home/20210812005046/en/

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