CCOM Group, Inc. Reports 2021 Second Quarter Results

Rhea-AI Summary

CCOM Group, Inc. (CCOM) reported strong financial results for Q2 and the first six months of 2021. For the quarter, sales surged 37.5% to $36.68 million with gross profit up 47% to $9.80 million. Operating income increased to $2.84 million and net income rose to $2.58 million, leading to a net income per share of $0.27. For the first half, sales grew 19.7% to $58.77 million, with a net income of $2.59 million. The company's continued growth reflects strong demand in the HVAC and related sectors.

Positive

• Sales increased 37.5% to $36,682,668 in Q2 2021.
• Gross profit up 47.0% to $9,796,106 in Q2 2021.
• Operating income improved to $2,844,389 in Q2 2021 from $1,093,954 in 2020.
• Net income for Q2 2021 is $2,580,346, compared to $931,921 in 2020.
• Net income per share rose to $0.27 in Q2 2021 from $0.10 in 2020.
• Sales for the first six months increased 19.7% to $58,765,528.

Negative

• Selling, general and administrative expenses increased 24.4% to $6,915,940 in Q2 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 SUBSIDIARIES
Condensed 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 accounts of $616,130 and $766,459, respectively			14,231,328			10,305,665
Inventory			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 credit		$	13,227,105		$	9,151,368
Notes 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 par value, 2,500,000 shares authorized, 284,612 shares issued and (Repayments) borrowings under credit facility - revolving credit, net			14,231			14,231
Common stock, $.05 par value, 20,000,000 shares authorized, 9,154,928 shares issued and outstanding			457,746			457,746
Additional 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 consolidated financial statements.

CCOM GROUP, INC. AND SUBSIDIARIES
Condensed 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 administrative expenses			6,915,940				5,560,415				12,907,652				12,072,912
Operating income			2,880,166				1,102,728				2,948,308				504,742
Other income			56,401				78,884				97,598				135,338
Interest expense, net			(92,178	)			(87,658	)			(168,829	)			(219,211	)
Income from operations			2,844,389				1,093,954				2,877,077				420,869
Income tax expense			264,043				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:
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 consolidated financial statements.

CCOM Group, Inc.
Consolidated Statements of Stockholders' Equity
For 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, 2020		284,612		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, 2021		284,612		9,154,928		$	14,231		$	457,746		$	12,596,853		$	3,848,859		$	16,917,689
Net Income																2,580,346			2,580,346
Balance at June 30, 2021		284,612		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. AND SUBSIDIARIES
Condensed 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			$	243,770
Adjustments to reconcile net income to net cash used in operating activities:
Deferred income taxes			158,333				158,333
Provision for doubtful accounts			(45,632	)			214,436
Depreciation			234,212				201,283
Net gain on sale of property and equipment			(5,200	)			(2,000	)
Changes in operating assets and liabilities
Accounts receivable			(3,880,031	)			(1,666,269	)
Inventory			(3,448,281	)			495,411
Prepaid expenses and other current assets			43,483				182,241
Other assets - noncurrent			(328,259	)			66,442
Trade payables			267,037				(462,642	)
Accrued liabilities			934,832				(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 equipment			5,200				2,000
Net 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			-				2,285,256
Borrowings (repayments) under credit facility - revolving credit, net			4,075,737				(453,686	)
Net cash provided by financing activities			3,999,452				1,777,457
Increase in cash			31,194				327,975
Cash - beginning of period			388,267				193,448
Cash - end of period		$	419,461			$	521,423
The accompanying notes are integral part of these condensed consolidated financial statements.

 

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FAQ

What were CCOM's sales for Q2 2021?

CCOM's sales for Q2 2021 were $36,682,668, representing a 37.5% increase compared to Q2 2020.

How much did CCOM's net income increase in Q2 2021?

CCOM's net income for Q2 2021 increased to $2,580,346, up from $931,921 in Q2 2020.

What is CCOM's earnings per share for the first half of 2021?

CCOM's earnings per share for the first half of 2021 increased to $0.27, up from $0.03 in the same period of 2020.

How did CCOM's gross profit change in Q2 2021?

CCOM's gross profit in Q2 2021 increased by 47.0% to $9,796,106.

What are CCOM's selling, general and administrative expenses for Q2 2021?

Selling, general and administrative expenses for Q2 2021 were $6,915,940, an increase of 24.4% from the previous year.