Attached files
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| 8-K - CCOM GROUP INC 8-K 8-13-2013 - CCOM Group, Inc. | form8k.htm |
EXHIBIT 99.01
CCOM Group, Inc. Reports 2013 Second Quarter Results
HAWTHORNE, New Jersey (August 13, 2013) – 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.
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
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June 30,
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December 31,
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||||||
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2013
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2012
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||||||
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(Unaudited)
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|||||||
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Assets
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||||||||
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Current assets:
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||||||||
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Cash
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$
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449,534
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$
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297,128
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||||
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Accounts receivable, net of allowance for doubtful accounts of $570,658 and $429,186, respectively
|
11,595,671
|
11,131,317
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||||||
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Inventory
|
12,825,434
|
12,029,400
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||||||
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Prepaid expenses and other current assets
|
1,062,818
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1,372,390
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||||||
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Total current assets
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25,933,457
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24,830,235
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||||||
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Property and equipment
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900,643
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1,036,710
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||||||
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Goodwill
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1,416,929
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1,416,929
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||||||
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Other assets – noncurrent
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204,922
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270,265
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||||||
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Deferred income tax asset – noncurrent
|
100,000
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100,000
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||||||
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$
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28,555,951
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$
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27,654,139
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||||
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Liabilities and Stockholders' Equity
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||||||||
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Current liabilities:
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||||||||
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Borrowings under credit facility - revolving credit
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$
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13,850,836
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$
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12,297,180
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||||
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Notes payable, current portion; includes related party notes of $1,383,335 and $607,999, respectively
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1,519,179
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745,500
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||||||
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Convertible notes payable-related party
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200,000
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-
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||||||
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Trade payables
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4,870,652
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5,242,044
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||||||
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Accrued liabilities
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1,644,233
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1,630,792
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||||||
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Total current liabilities
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22,084,900
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19,915,516
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||||||
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Convertible notes payable-related party
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-
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200,000
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||||||
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Notes payable, non-current portion; includes related party notes of $606,004 and $1,440,015, respectively
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1,041,456
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1,947,813
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||||||
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Deferred income tax liability – noncurrent
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517,000
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496,000
|
||||||
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Total liabilities
|
23,643,356
|
22,559,329
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||||||
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Commitments and contingencies
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||||||||
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Stockholders' equity:
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||||||||
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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
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||||||
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Common stock, $.05 par value, 20,000,000 shares authorized, 9,154,953 shares issued and outstanding
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457,747
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457,747
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||||||
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Additional paid-in capital
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12,659,782
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12,659,782
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||||||
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Accumulated deficit
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(8,219,587
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)
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(8,037,372
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)
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||||
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Total stockholders' equity
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4,912,595
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5,094,810
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||||||
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$
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28,555,951
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$
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27,654,139
|
||||
CCOM GROUP, INC. AND SUBSIDIARIES
(Unaudited)
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For The Three Months Ended
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For The Six Months Ended
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||||||||||||||
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June 30,
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June 30,
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||||||||||||||
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2013
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2012
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2013
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2012
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||||||||||||
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Sales
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$
|
24,443,817
|
$
|
21,737,833
|
$
|
43,173,255
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$
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39,829,607
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||||||||
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Cost of sales
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18,609,090
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16,213,650
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32,514,281
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29,756,834
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||||||||||||
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Gross profit
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5,834,727
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5,524,183
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10,658,974
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10,072,773
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||||||||||||
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||||||||||||||||
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Selling, general and administrative expenses, net
|
5,188,210
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5,023,109
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10,631,793
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10,435,457
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||||||||||||
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Operating income (loss)
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646,517
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501,074
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27,181
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(362,684
|
)
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|||||||||||
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|
||||||||||||||||
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Other income
|
63,907
|
54,343
|
113,429
|
108,592
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||||||||||||
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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
|
)
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(301,825
|
)
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(303,519
|
)
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||||||||
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Income (loss) before income tax expense
|
560,262
|
405,979
|
(161,215
|
)
|
(557,611
|
)
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||||||||||
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|
||||||||||||||||
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Income tax expense
|
10,500
|
-
|
21,000
|
-
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||||||||||||
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Net income (loss)
|
$
|
549,762
|
$
|
405,979
|
$
|
(182,215
|
)
|
$
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(557,611
|
)
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||||||
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||||||||||||||||
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Income (loss) per common share:
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||||||||||||||||
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Basic
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$
|
0.06
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$
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0.04
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$
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(0.02
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)
|
$
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(0.06
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)
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||||||
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Diluted
|
$
|
0.06
|
$
|
0.04
|
$
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(0.02
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)
|
$
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(0.06
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)
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||||||
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||||||||||||||||
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Weighted average shares outstanding:
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||||||||||||||||
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Basic
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9,154,953
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9,154,953
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9,154,953
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9,154,953
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||||||||||||
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Diluted
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9,448,010
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9,448,010
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9,154,953
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9,154,953
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||||||||||||
CCOM GROUP, INC. AND SUBSIDIARIES
(Unaudited)
|
|
For Six Months Ended
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|||||||
|
|
June 30,
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|||||||
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2013
|
2012
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||||||
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Cash flows from operating activities:
|
||||||||
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Net loss
|
$
|
(182,215
|
)
|
$
|
(557,611
|
)
|
||
|
Adjustments to reconcile net loss to net cash used in operating activities:
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||||||||
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Deferred income taxes
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21,000
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-
|
||||||
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Provision for doubtful accounts
|
165,375
|
238,653
|
||||||
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Depreciation
|
164,900
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187,492
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||||||
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Net gain on disposal of fixed assets
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(9,259
|
)
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(1,113
|
)
|
||||
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Changes in operating assets and liabilities:
|
||||||||
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Accounts receivable
|
(629,729
|
)
|
(506,402
|
)
|
||||
|
Inventory
|
(796,034
|
)
|
(1,047,122
|
)
|
||||
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Prepaid expenses and other current assets
|
309,572
|
147,342
|
||||||
|
Other assets - noncurrent
|
65,343
|
46,078
|
||||||
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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
|
)
|
||||
|
|
||||||||
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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
|
||||