CCOM Group, Inc. Reports 2021 Third Quarter Results

HAWTHORNE, N.J.--(BUSINESS WIRE)-- CCOM Group, Inc. (“CCOM”) (OTC Pink: “CCOM,” “CCOMP”), announced its financial results for the three and nine months ended September 30, 2021.

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

• Sales increased 14.6% to $32,310,514 from $28,185,554
• Gross profit increased 21.8% to $9,012,731 from $7,401,499
• Selling, general and administrative expenses increased 19.4% to $7,365,369 from $6,169,708
• Operating income increased 33.7% to $1,647,362 compared to $1,231,791
• Net income of $3,615,164 compared to $917,443; 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). The 2021 amount includes a $2,285,256 gain on early extinguishment of PPP debt.
• Net income per share on a fully diluted basis increased to $0.37 per share from $0.09 per share

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

• Sales increased 17.9% to $91,076,042 from $77,279,836
• Gross profit increased 24.5% to $24,868,691 from $19,979,153
• Selling, general and administrative expenses increased 11.1% to $20,273,021 from $18,242,620
• Operating income of $4,595,670 compared to $1,736,533
• Net income of $6,209,349 compared to $1,161,213; 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). The 2021 amount includes a $2,285,256 gain on early extinguishment of PPP debt.
• Net income per share on a fully diluted basis increased to $0.64 per share from $0.12 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.

(Financial Highlights Follow)

CCOM GROUP, INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
			September 30,			December 31,
			2021			2020
			(Unaudited)
Assets
Current assets:
Cash		$	296,154		$	388,267
Accounts receivable, net of allowance for doubtful accounts of $664,162 and $766,459, respectively
			11,699,412			10,305,665
Inventory			23,575,963			20,936,936
Prepaid expenses and other current assets			821,064			749,053
Total current assets			36,392,593			32,379,921
Property and equipment			1,520,783			1,095,506
Goodwill			1,416,928			1,416,929
Other assets - noncurrent			576,835			188,824
Deferred tax asset - noncurrent			2,231,909			2,548,575
		$	42,139,048		$	37,629,755
Liabilities and Stockholders' Equity
Current liabilities:
Borrowings under credit facility - revolving credit		$	9,492,568		$	9,151,368
Notes payable - current portion			161,629			627,009
Trade payables			5,450,050			5,892,126
Accrued liabilities			3,189,541			2,450,810
Income taxes payable			-			2,850
Total current liabilities			18,293,788			18,124,163
Notes payable, excluding current portion			378,061			2,247,742
Deferred tax liability - noncurrent			354,000			354,000
Total liabilities			19,025,849			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			10,044,369			3,835,020
Total stockholders' equity			23,113,199			16,903,850
		$	42,139,048		$	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 Nine Months Ended
				September 30,						September 30,
					2021			2020			2021			2020
Sales				$	32,310,514		$	28,185,554		$	91,076,042		$	77,279,836
Cost of sales					23,297,783			20,784,055			66,207,351			57,300,683
Gross profit					9,012,731			7,401,499			24,868,691			19,979,153
Selling, general and administrative expenses					7,365,369			6,169,708			20,273,021			18,242,620
Operating income					1,647,362			1,231,791			4,595,670			1,736,533
Gain on Early Extinguishment of debt					2,285,256			-			2,285,256			-
Other income					42,121			44,026			139,719			179,364
Interest expense, net					(83,722)			(78,525)			(252,551)			(297,736)
Income from operations					3,891,017			1,197,292			6,768,094			1,618,161
Income tax expense					275,853			279,849			558,745			456,948
Net income				$	3,615,164		$	917,443		$	6,209,349		$	1,161,213
Income per common share:
Basic				$	0.38		$	0.10		$	0.66		$	0.12
Diluted				$	0.37		$	0.09		$	0.64		$	0.12
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 Nine Months Ended September 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
Net Income																		3,615,164			3,615,164
Balance at September 30, 2021			284,612			9,154,928		$	14,231		$	457,746		$	12,596,853		$	10,044,369		$	23,113,199
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 Nine Months Ended
							September 30,
							2021			2020
Cash flows from operating activities:
Net income						$	6,209,349		$	1,161,213
Adjustments to reconcile net income to net cash
provided by operating activities:
Deferred income taxes							316,666			316,666
Provision for doubtful accounts							62,395			274,627
Depreciation							384,870			309,633
Net gain on sale of property and equipment							(6,200)			(12,300)
Forgiveness of financing							(2,285,256)			-
Changes in operating assets and liabilities
Accounts receivable							(1,456,142)			151,870
Inventory							(2,639,027)			(1,196,752)
Prepaid expenses and other current assets							(72,011)			273,993
Other assets - noncurrent							(388,011)			109,474
Trade payables							(442,076)			1,051,231
Accrued liabilities							738,731			(280,992)
Income taxes payable							(2,850)			(24,625)
Net cash provided by operating activities							420,438			2,134,038
Cash flows from investing activities:
Additions to property and equipment							(741,119)			(228,920)
Proceeds from disposal of property and equipment							6,200			12,300
Net cash used in investing activities							(734,919)			(216,620)
Cash flows from financing activities:
Repayments of notes payable							(118,832)			(86,670)
Issuance of financing							-			2,285,256
Borrowings (repayments) under credit facility - revolving credit, net							341,200			(4,022,898)
Net cash provided by (used in) financing activities							222,368			(1,824,312)
(Decrease) / Increase in cash							(92,113)			93,106
Cash - beginning of period							388,267			193,448
Cash - end of period						$	296,154		$	286,554
The accompanying notes are integral part of these condensed consolidated financial statements.

 

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

Source: CCOM Group, Inc.