Colonial Commercial Corp. Reports Third Quarter and Nine Months Ended September 30, 2004 Results; Cites Increase in Revenues And Income.HICKSVILLE Hicksville, uninc. city (1990 pop. 40,174), Nassau co., SE N.Y., on Long Island; founded 1648. It is chiefly residential, with electronic and metal products manufacturing and some nearby truck farming. Hicksville also has a major retail shopping complex. , N.Y. -- Colonial Commercial Corp. ("Colonial") (NASD NASD See: National Association of Securities Dealers NASD See National Association of Securities Dealers (NASD). Bulletin Board: "CCOM CCOM Cheshil.com CCOM Conference Council on Ministries (United Methodist Church) CCOM Chicago College of Osteopathic Medicine CCOM Conseil Canadien des Organismes de Motoneige CCOM Call Center Operations Management CCOM Center of Coastal Ocean Mapping ," "CCOMP"), today announced its financial results for the third quarter and nine months ended September September: see month. 30, 2004. For the quarter ended September 30, 2004, revenues increased 43.0% to $16,185,005, compared with revenues of $11,321,632 in the 2003 quarter. These results included RAL 1. RAL - Rutherford Appleton Laboratory (UK). 2. RAL - An expert system. Supply Group, Inc. ("RAL"), which was acquired on September 30, 2003, and American/Universal Supply Inc. ("American"), which was a new operation that commenced on or about July 1, 2003, and increased market penetration Noun 1. market penetration - the extent to which a product is recognized and bought by customers in a particular market penetration - the act of entering into or through something; "the penetration of upper management by women" in the core business of Universal Supply Group, Inc. ("Universal"), Colonial's major subsidiary. Gross margin dollars increased by $1,507,289 over the 2003 period. Gross margins expressed as a percentage of sales increased from 28.5% in 2003 to 29.2% in 2004, primarily due to increases in sales of deluxe de·luxe also de luxe adj. Particularly elegant and luxurious; sumptuous: deluxe accommodations; a de luxe automobile. adv. higher margin products. The Company reported net income of $839,082, which included a net income tax benefit of $516,000 compared to net income of $325,659 in the 2003 quarter. The 2004 period included a non-cash charge Non-Cash Charge A charge off, made by a company against earnings, that does not require an initial outlay of cash. Notes: Non-cash charges are typically against the depreciation, amortization, and depletion accounts on a company's balance sheet. of $33,960 for stock-based compensation compared to no stock-based compensation charge in the 2003 period. For the nine months ended September 30, 2004, revenues increased 47.7% to $44,859,290, compared with revenues of $30,368,961 in the 2003 period. Simultaneously, gross margin dollars increased by $4,651,635 substantially and directly related to the sales increases. Gross margins expressed as a percentage of sales increased from 28.6% in 2003 to 29.7% in 2004, primarily due to increases in sales of deluxe higher margin products. The Company reported net income of $1,203,337, which included a net income tax benefit of $645,600, compared to net income of $437,394, which included a net income tax benefit of $91,371 in the 2003 period. The 2004-period included a non-cash charge of $84,900 for stock based compensation, compared to no stock based compensation charge in the 2003 period. The Company expects that it will be profitable for the year 2004 and that profits will exceed 2003 profits. In the third quarter of 2004, Colonial raised $2,550,000 by privately placing an aggregate of 1,020,000 shares of common stock at $1.25 per share, a warrant to purchase 150,000 shares at $3.00 per share, and four and five-year promissory notes promissory note, unconditional written promise to pay a certain sum of money at a definite time to bearer or to a specified person on his order. Promissory notes are generally used as evidence of debt. due 2008 and 2009 in the aggregate principal amount of $1,275,000. Of these notes, $525,000 principal amount is convertible into common stock at $3 per share. The Company also entered into a $15 million secured loan facility with Wells Fargo Wells Fargo armored carriers of bullion. [Am. Hist.: Brewer Dictionary, 1147] See : Protectiveness Wells Fargo company that handled express service to western states; often robbed. [Am. Hist. Business Credit Inc. The Company used approximately $12,865,000 of the proceeds of this facility to repay its previous senior lender, LaSalle National Bank, and is using the balance for additional working capital. Bernard Ber·nard , Claude 1813-1878. French physiologist noted for his study of the digestive and nervous systems. Korn, CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. and Chairman of the Company, said, "We believe Colonial's future is promising. Universal, and its affiliates, have had significant increases in sales and operating profits Operating profit (or loss) Revenue from a firm's regular activities less costs and expenses and before income deductions. operating profit See operating income. in the past five years. We enjoy a superior reputation among customers, as well as a variety of exclusive and semi-exclusive distribution agreements with manufacturers. Our management is experienced and has the leadership qualities and focus to continue to grow and succeed." He added, "The funds we have raised and our new loan facility give us the liquidity to take advantage of special purchases and additional discounts, and should enhance the further growth of our Universal, RAL and American subsidiaries. Universal, RAL and American sell multiple heating, cooling, plumbing plumbing, piping systems inside buildings for water supply and sewage. The Romans had a highly developed plumbing system; water was brought to Rome by aqueducts and distributed to homes in lead pipes—hence the name plumbing from the Latin word plumbum , in-door air quality and fireplace fireplace Opening made in the base of a chimney to hold an open fire. The opening is framed, usually ornamentally, by a mantel (or mantelpiece). A medieval development that replaced the open central hearth for heating and cooking, the fireplace was sometimes large enough to product lines to commercial and residential contractors. They operate out of 18 locations in New Jersey, New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of and Pennsylvania Pennsylvania (pĕnsəlvā`nyə), one of the Middle Atlantic states of the United States. It is bordered by New Jersey, across the Delaware River (E), Delaware (SE), Maryland (S), West Virginia (SW), Ohio (W), and Lake Erie and New York with over 310,000 square feet of warehouse space. They operate four regional training facilities for their employees and their customers' employees, have two engineering operations and five showrooms located in New Jersey, New York and Pennsylvania. This press release includes statements that may constitute "forward-looking" statements, usually containing the words, "believe," "estimate," "project," "expect" or similar expressions. These statements are made pursuant to the safe harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. provisions of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. Forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. inherently involve risks and uncertainties that could cause actual results to differ materially from the forward-looking statements. Factors that would cause or contribute to such differences include, but are not limited to, 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. By making these forward-looking statements, the Company undertakes no obligation to update these statements for revisions or changes after the date of this release. (Financial Highlights Follow)
COLONIAL COMMERCIAL CORP.
AND SUBSIDIARIES
SELECTED FINANCIAL HIGHLIGHTS
(Unaudited)
Three Months Ended
September 30, September 30,
2004 2003
Sales $16,185,005 $11,321,632
Cost of Sales 11,453,648 8,097,564
---------- ---------
Gross Profit 4,731,357 3,224,068
Selling, general and administrative
expenses, net 4,177,443 2,841,206
--------- ---------
Operating Income 553,914 382,862
Other Income 58,280 134,780
Interest Expense (249,463) (149,182)
--------- ---------
Income Before Income Taxes 362,731 368,460
Income Tax Expense (Benefit) (476,351) 42,801
--------- ------
Net Income $ 839,082 $ 325,659
======= =======
Net Income Per Common Share:
Basic $ 0.22 $ 0.14
Diluted $ 0.17 $ 0.08
Weighted Average Common Shares Outstanding:
Basic 3,747,715 2,292,468
Diluted 4,998,592 3,881,522
COLONIAL COMMERCIAL CORP.
AND SUBSIDIARIES
SELECTED FINANCIAL HIGHLIGHTS
(Unaudited)
Nine Months Ended
September 30, September 30,
2004 2003
Sales $44,859,290 $30,368,961
Cost of Sales 31,520,092 21,681,398
---------- ----------
Gross Profit 13,339,198 8,687,563
Selling, general and administrative
expenses, net 12,308,681 8,096,637
---------- ---------
Operating Income 1,030,517 590,926
Other Income 240,557 274,911
Interest Expense (622,515) (447,606)
--------- ---------
Income Before Income Taxes 648,559 418,231
Income Tax Expense (Benefit) (554,778) (19,163)
--------- ---------
Net Income $ 1,203,337 $ 437,394
========= =======
Net Income Per Common Share:
Basic $ 0.38 $ 0.24
Diluted $ 0.27 $ 0.13
Weighted Average Common Shares Outstanding:
Basic 3,164,125 1,833,352
Diluted 4,387,443 3,339,205
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