Colonial Commercial Corp. (“Colonial”) (Common Stock: CCOM; Convertible Preferred Stock: CCOMP) today announced financial results for the fourth quarter and year ended December 31, 2010.

Fourth Quarter Results

Sales were $20,653,934 for the quarter ended December 31, 2010 compared to $20,503,046 for the same period in 2009.

Gross profit increased by 5.2%, or $284,829, to $5,722,373 for the fourth quarter from $5,437,544 for the same period in 2009. Gross profit expressed as a percentage of sales increased to 27.7% for the fourth quarter from 26.5% for the same period in 2009. The increase in gross profit expressed as a percentage of sales was mostly related to improved implementation of purchasing programs.

Selling, general and administrative expense declined by 6.0%, or $339,407, to $5,279,167 for the fourth quarter from $5,618,574 for the same period in 2009. The decrease in selling, general and administrative expense is primarily related to a general reduction in various operating expenses.

The Company’s net income was $262,846, for the fourth quarter compared to a net loss of $1,157,597 for the same period in 2009. The increase in net income is the result of a reduction of general operating expenses and the elimination of $741,204 in non-recurring non-cash charges which occurred in the fourth quarter of 2009.

Year-End Results

Sales increased by 2.5%, or $1,971,727, to $80,056,230 for the year ended December 31, 2010 from $78,084,503 for the same period in 2009.

Gross profit increased by 3.5%, or $730,108, to $21,564,727 for the year ended December 31, 2010 from $20,834,619 for the same period in 2009. The increase in gross profit is the result of the re-opening of our Hicksville, New York location, the expansion of our commercial HVAC products business and the increase in margins gained through the sale of high-efficiency heating and air conditioning equipment. Gross profit expressed as a percentage of sales was 26.9% in 2010 compared to 26.7% for the comparable period in 2009.

Selling, general and administrative expenses decreased by 6.0%, or $1,315,667, to $20,786,019 for the year ended December 31, 2010 from $22,101,686 for the same period in 2009. The decrease in selling, general and administrative expense is primarily related to a $420,276 reduction in rent and facility expenses, a $271,322 reduction in payroll and benefit costs, an $84,543 reduction in depreciation and amortization, and the elimination of $273,023 in non-recurring tender offer expenses.

The Company’s net income was $106,398 for the year ended December 31, 2010 compared to a net loss of $3,343,696 for the same period in 2009. The increase in net income is substantially the result of the $730,108 increase in gross profit, the $1,315,667 decrease in selling, general and administrative expense, and the elimination of $1,521,104 in non-recurring non-cash charges.

William Salek, Chief Financial Officer of the Company, said, “We are pleased that we have been able to produce our fourth consecutive quarter showing improved earnings. We could not have achieved these results without the commitment and dedication of our employees, customers and vendors.”

About Colonial Commercial Corp.

Colonial distributes heating, ventilating and air conditioning, (“HVAC”), equipment, parts and accessories, climate control systems, customized control panels, and plumbing and electrical supplies and equipment to professional contractors in the states of New York, New Jersey, Massachusetts, Connecticut and eastern Pennsylvania 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. The Company also distributes home appliances to dealer groups and appliance stores through its Goldman Universal division. The Company is headquartered in New Jersey, and, with its affiliates, operates out of 19 locations in its geographic trading area. For more information on Colonial’s operations, products and/or services, please visit www.colonialcomm.com.

Safe Harbor Statement

The foregoing press release may contain statements concerning Colonial Commercial Corp.’s financial performance, markets and business operations that may be considered "forward-looking" under applicable securities laws. Colonial 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 the company's products in the marketplace, competitive factors, dependence upon third-party vendors, and other risks detailed in the company'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 Colonial's periodic reports and registration statements filed with the Securities and Exchange Commission, which important factors are incorporated herein by reference. Colonial 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.

  COLONIAL COMMERCIAL CORP. AND SUBSIDIARIES Consolidated Balance Sheets     December 31,   December 31,   2010   2009 Assets Current assets: Cash $ 75,390 $ 746,629 Accounts receivable, net of allowance for doubtful accounts of $694,083 in 2010 and $619,740 in 2009 9,632,829 9,468,123 Inventory 10,781,069 11,588,971 Prepaid expenses and other current assets   1,111,625   895,505 Total current assets 21,600,913 22,699,228 Property and equipment 1,126,810 1,349,679 Goodwill 1,416,929 1,416,929 Other intangibles - 2,500 Other assets - noncurrent   172,913   134,205 $ 24,317,565 $ 25,602,541 Liabilities and Stockholders' Equity Current liabilities: Trade payables $ 6,513,506 $ 7,402,536 Accrued liabilities 1,674,403 1,559,880 Income taxes payable 2,360 4,374 Borrowings under credit facility - revolving credit 10,770,235 13,090,666 Notes payable - current portion; includes related party notes of $32,009 in 2010 and 2009   1,094,275   108,313 Total current liabilities 20,054,779 22,165,769 Convertible notes payable-related party 200,000 200,000 Notes payable, excluding current portion; includes related party notes of $830,024 in 2010 and $862,033 in 2009   1,686,179   966,563 Total liabilities   21,940,958   23,332,332 Commitments and contingencies Stockholders' equity: Redeemable convertible preferred stock, $.05 par value, 2,500,000 shares authorized, 293,057 shares issued and outstanding in 2010 and 2009, liquidation preference of $1,465,285 in 2010 and 2009 14,653 14,653 Common stock, $.05 par value, 20,000,000 shares authorized, 4,654,953 shares issued and outstanding in 2010 and 2009 232,747 232,747 Additional paid-in capital 10,634,782 10,634,782 Accumulated deficit   (8,505,575)   (8,611,973) Total stockholders' equity   2,376,607   2,270,209 $ 24,317,565 $ 25,602,541   COLONIAL COMMERCIAL CORP. AND SUBSIDIARIES Consolidated Statements of Operations           For the quarter ended December 31, For the year ended December 31,   2010   2009   2010   2009 Sales $ 20,653,934 $ 20,503,046 $ 80,056,230 $ 78,084,503 Cost of sales   14,931,561   15,065,502   58,491,503   57,249,884 Gross profit 5,722,373 5,437,544 21,564,727 20,834,619   Selling, general and administrative expenses, net 5,279,167 5,618,574 20,786,019 22,101,686 Impairment of other intangibles - - - 309,900 Write off of goodwill   -   211,204   -   211,204 Operating income (loss) 443,206 (392,234) 778,708 (1,788,171)   Other income 61,746 80,975 273,951 239,726

Interest expense, net; includes related partyinterest of $16,070 and $19,048 for the quartersended December 31, 2010 and 2009, respectivelyand $65,720 and $65,494 for the years endedDecember 31, 2010 and 2009, respectively

  (242,106)   (316,338)   (946,261)   (795,251) Income (loss) before income tax expense 262,846 (627,597) 106,398 (2,343,696)   Income tax expense   -   530,000   -   1,000,000 Net income (loss) $ 262,846 $ (1,157,597) $ 106,398 $ (3,343,696)   Income (loss) per common share: Basic $ 0.06 $ (0.25) $ 0.02 $ (0.72) Diluted $ 0.05 $ (0.25) $ 0.02 $ (0.72)   Weighted average shares outstanding: Basic   4,654,953   4,654,953   4,654,953   4,654,953 Diluted   4,948,010   4,654,953   4,948,010   4,654,953   COLONIAL COMMERCIAL CORP. AND SUBSIDIARIES Consolidated Statements of Cash Flows     For The Year Ended 2010       2009 Cash flows from operating activities: Net income (loss) $ 106,398 $ (3,343,696) Adjustments to reconcile net income (loss) to net cash provided by operating activities: Deferred tax expense - 1,000,000 Stock-based compensation - 23,049 Provision for doubtful accounts 548,559 539,310 Inventory reserves (17,000) 98,000 Depreciation 437,036 506,993 Net gain on sale of fixed assets (7,677) (15,358) Amortization of intangibles 2,500 17,085 Write-off of goodwill - 211,204 Impairment of other intangibles - 309,900 Changes in operating assets and liabilities Accounts receivable (713,265) (1,204,802) Inventory 824,902 2,019,623 Prepaid expenses and other current assets (216,120) 195,129 Other assets – noncurrent (38,708) 25,596 Trade payables 1,110,970 382,794 Accrued liabilities 114,523 92,636 Income taxes payable (2,014) 3,816 Net cash provided by operating activities 2,150,104 861,279   Cash flows from investing activities: Additions to property and equipment (89,912) (180,326) Proceeds from disposal of property and equipment 20,700 43,816 Net cash used in investing activities (69,212) (136,510)   Cash flows from financing activities: Repurchase of preferred stock - (193,543) Repayments of notes payable; includes related party repayments of $0 in 2010 and $92,500 in 2009 (395,649) (291,014) Issuance of notes payable in connection with financing tender offer - 446,033 Repayment of notes payable to related parties in connection with financing tender offer (36,051) (283,805) Repayments under credit facility - revolving credit, net (2,320,431) (73,198) Net cash used in financing activities (2,752,131) (395,527) (Decrease) increase in cash (671,239) 329,242 Cash - beginning of period 746,629 417,387 Cash - end of period $ 75,390 $ 746,629