CCOM Group, Inc. Reports 2013 Second Quarter Results

CCOM Group, Inc. Reports 2013 Second Quarter Results

HAWTHORNE, N.J.--(BUSINESS WIRE)-- CCOM Group, Inc. ("CCOM") (OTCQB: "CCOM," "CCOMP"), today announced its financial results for the three months and six months ended June 30, 2013.

Results for the three months ended June 30, 2013 compared to results for the same period in 2012:

  • Sales increased 12.4% to $24,443,817 from $21,737,833

  • Gross profit increased 5.6% to $5,834,727 from $5,524,183

  • Selling, general and administrative expenses increased 3.3% to $5,188,210 from $5,023,109

  • Operating income increased 29.0% to $646,517 from $501,074

  • Net income increased 35.4% to $549,762 from $405,979

  • Net income per share on a fully diluted basis increased to $0.06 from $0.04 per share


Results for the six months ended June 30, 2013 compared to results for the same period in 2012:

  • Sales increased 8.4% to $43,173,255 from $39,829,607

  • Gross profit increased 5.8% to $10,658,974 from $10,072,773

  • Selling, general and administrative expenses increased 1.9% to $10,631,793 from $10,435,457

  • Operating income increased to $27,181 from an operating loss of $(362,684)

  • Net loss decreased 67.3% to $(182,215) from $(557,611)

  • Net loss per share on a fully diluted basis decreased to $(0.02) from $(0.06) per share

Peter D. Gasiewicz, Chief Executive Officer of CCOM, said, "We are pleased that sales have continued to increase for three consecutive quarters as compared to the prior year's corresponding quarters. Our focus continues toward a wider, more profitable, and less seasonal family of products. We are hopeful that the HVAC market will rebound and expect that we'll be able to capitalize on a recovery."

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, appliances 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, American/Universal Supply Division, www.ausupplyinc.com, and S&A Supply, Inc., www.sasupplyinc.com. CCOM is headquartered in New Jersey, and, with its affiliates, operates out of 17 locations in its geographic trading area. For more information on CCOM's operations, products and/or services, please visit www.ccomgrp.com.

Safe Harbor Statement

The foregoing press release may contain statements concerning CCOM's financial performance, markets and business operations that may be considered "forward-looking" under applicable securities laws. CCOM cautions readers of this press release that actual results might differ materially from those projected in any forward-looking statements. Factors which might cause actual results to differ materially from any results that are projected in the forward-looking statements include the following: continued acceptance of CCOM's products in the marketplace, competitive factors, dependence upon third-party vendors, and other risks detailed in CCOM's periodic report filings with the Securities and Exchange Commission. These and certain other factors which might cause actual results to differ materially from those projected are detailed from time to time in CCOM's periodic reports and registration statements filed with the Securities and Exchange Commission. CCOM undertakes no obligation to update forward looking statements to reflect changed assumptions, the occurrence of unanticipated events, or changes in future operating results, financial condition or business over time.

(Financial Highlights Follow)

CCOM GROUP, INC. AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

June 30,

December 31,

2013

2012

(Unaudited)

Assets

Current assets:

Cash

$

449,534

$

297,128

Accounts receivable, net of allowance for doubtful accounts of $570,658 and $429,186, respectively

11,595,671

11,131,317

Inventory

12,825,434

12,029,400

Prepaid expenses and other current assets

1,062,818

1,372,390

Total current assets

25,933,457

24,830,235

Property and equipment

900,643

1,036,710

Goodwill

1,416,929

1,416,929

Other assets - noncurrent

204,922

270,265

Deferred income tax asset - noncurrent

100,000

100,000

$

28,555,951

$

27,654,139

Liabilities and Stockholders' Equity

Current liabilities:

Borrowings under credit facility - revolving credit

$

13,850,836

$

12,297,180

Notes payable, current portion; includes related party notes of $1,383,335 and $607,999, respectively

1,519,179

745,500

Convertible notes payable-related party

200,000

-

Trade payables

4,870,652

5,242,044

Accrued liabilities

1,644,233

1,630,792

Total current liabilities

22,084,900

19,915,516

Convertible notes payable-related party

-

200,000

Notes payable, non-current portion; includes related party notes of $606,004 and $1,440,015, respectively

1,041,456

1,947,813

Deferred income tax liability - noncurrent

517,000

496,000

Total liabilities

23,643,356

22,559,329

Commitments and contingencies

Stockholders' equity:

Redeemable convertible preferred stock, $.05 par value, 2,500,000 shares authorized, 293,057 shares

issued and outstanding, liquidation preference of $1,465,285

14,653

14,653

Common stock, $.05 par value, 20,000,000 shares authorized, 9,154,953 shares issued and outstanding

457,747

457,747

Additional paid-in capital

12,659,782

12,659,782

Accumulated deficit

(8,219,587

)

(8,037,372

)

Total stockholders' equity

4,912,595

5,094,810

$

28,555,951

$

27,654,139

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,

2013

2012

2013

2012

Sales

$

24,443,817

$

21,737,833

$

43,173,255

$

39,829,607

Cost of sales

18,609,090

16,213,650

32,514,281

29,756,834

Gross profit

5,834,727

5,524,183

10,658,974

10,072,773

Selling, general and administrative expenses, net

5,188,210

5,023,109

10,631,793

10,435,457

Operating income (loss)

646,517

501,074

27,181

(362,684)

Other income

63,907

54,343

113,429

108,592

Interest expense, net; includes related party interest of $34,055 and $18,877 for three months ended June 30, 2013 and 2012, respectively, and $67,464 and $34,913 for the six months ended June 30, 2013 and 2012, respectively

(150,162)

(149,438)

(301,825)

(303,519)

Income (loss) before income tax expense

560,262

405,979

(161,215)

(557,611)

Income tax expense

10,500

-

21,000

-

Net income (loss)

$

549,762

$

405,979

$

(182,215)

$

(557,611)

Income (loss) per common share:

Basic

$ 0.06

$ 0.04

$ (0.02)

$ (0.06)

Diluted

$ 0.06

$ 0.04

$ (0.02)

$ (0.06)

Weighted average shares outstanding:

Basic

9,154,953

9,154,953

9,154,953

9,154,953

Diluted

9,448,010

9,448,010

9,154,953

9,154,953

CCOM GROUP, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Cash Flows

(Unaudited)

For Six Months Ended

June 30,

2013

2012

Cash flows from operating activities:

Net loss

$

(182,215)

$

(557,611)

Adjustments to reconcile net loss to net cash used in operating activities:

Deferred income taxes

21,000

-

Provision for doubtful accounts

165,375

238,653

Depreciation

164,900

187,492

Net gain on disposal of fixed assets

(9,259)

(1,113)

Changes in operating assets and liabilities:

Accounts receivable

(629,729)

(506,402)

Inventory

(796,034)

(1,047,122)

Prepaid expenses and other current assets

309,572

147,342

Other assets - noncurrent

65,343

46,078

Trade payables

(371,392)

65,608

Accrued liabilities

13,441

47,250

Income taxes payable

-

(586)

Net cash used in operating activities

(1,248,998)

(1,380,411)

Cash flows from investing activities:

Additions to property and equipment

(42,757)

(80,335)

Proceeds from disposal of property and equipment

50,647

2,600

Net cash provided by (used in) investing activities

7,890

(77,735)

Cash flows from financing activities:

Repayments of notes payable; includes related party repayments of $1,048,014

and $366,005, respectively

(1,160,142)

(544,135)

Issuance of notes payable, related party

1,000,000

850,000

Borrowings under credit facility - revolving credit, net

1,553,656

1,124,296

Net cash provided by financing activities

1,393,514

1,430,161

Increase (decrease) in cash

152,406

(27,985)

Cash - beginning of period

297,128

271,697

Cash - end of period

$

449,534

$

243,712

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CCOM Group, Inc.
Peter D. Gasiewicz, 973-427-8224
Chief Executive Officer
or
William Salek, 973-427-8224
Chief Financial Officer

KEYWORDS: United States North America New Jersey

INDUSTRY KEYWORDS:

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