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