Investor flows rotate toward small companies with improving earnings; Capstone advances toward EBITDA profitability and scale monetization NEW YORK CITY, NEW YORK / ACCESS Newswire / February 3, 2026 / Capstone Holding Corp. (NASDAQ:CAPS), a tech-enabled building products distribution platform, today highlighted early-2026 market conditions that reinforce Capstone's execution strategy and support continued progress toward sustainable earnings growth.[1] In January, the Russell 2000 outperformed the S&P 500 ...

Immediate overhead reductions strengthen free cash flow, align management compensation with shareholder equity, and establish clear path to positive EBITDA beginning in Q2 2026. NEW YORK CITY, NEW YORK / ACCESS Newswire / January 21, 2026 / Capstone Holding Corp. (NASDAQ:CAPS), a national building products distribution platform, today announced the execution of a cost rationalization program accelerating the Company's transition to positive free cash flow and EBITDA.The initiatives remove approximately $ ...

Core Insights - Capstone Holding Corp. is enhancing its commitment to investor engagement by addressing priorities related to organic growth and margin expansion [1] Group 1: Investor Engagement - The company plans to publish an investor FAQ during the week of January 19 to address common shareholder questions [1] - Shareholders are invited to submit their questions via email to ensure their concerns are addressed by management [1]

Core Insights - Capstone Holding Corp. has extended its revolving credit facility with Berkshire Bank until June 19, 2026, which enhances its liquidity position and supports its growth strategy [1] Group 1 - The extension of the credit facility preserves the company's liquidity runway [1] - The arrangement carries no added cost for the company [1] - This move provides flexibility as Capstone advances its disciplined growth strategy [1]

Core Insights - Capstone Holding Corp. has successfully integrated Canadian Stone Industries, contributing an additional $15 million in revenue to its platform [1] Group 1: Company Performance - The integration of Canadian Stone Industries marks a significant operational win for Capstone, reinforcing the effectiveness of its disciplined M&A strategy [1] - The addition of revenue from Canadian Stone Industries highlights the immediate accretive impact of Capstone's strategic acquisitions [1]

Core Insights - The transaction enhances Capstone's platform and supports its goal of achieving a $100 million run-rate by early 2026 [1] - Capstone Holding Corp. has successfully completed the acquisition of Canadian Stone Industries, which generates $15 million in annual revenue [1] Company Summary - Capstone Holding Corp. is a national building products distribution platform [1] - The acquisition of Canadian Stone Industries marks a strategic move to strengthen Capstone's market position [1]

Core Insights - The article emphasizes that there is a growing demand for deferred exterior and outdoor remodeling, indicating a multi-year demand cycle in the industry [1] Industry Summary - Market data from Zonda and Bain & Company forecasts accelerated growth in remodeling and consolidation trends favoring multi-regional platforms like Capstone [1] - The remodeling sector is expected to experience significant growth due to pent-up demand, which is likely to benefit companies positioned in the market [1]

Core Insights - Capstone Holding Corp. is on an accelerating path toward achieving a $100 million run-rate, indicating strong growth potential in the building products distribution sector [1]. Group 1: Q3 Growth Drivers - The company published its full third-quarter 2025 investor presentation, highlighting key growth drivers that contributed to its performance [1]. - Insights from the presentation suggest that margin expansion played a significant role in the company's financial results for the quarter [1]. Group 2: Financial Performance - The management transcript provides detailed analysis on the financial metrics for Q3 2025, showcasing the company's robust performance in the building products market [1]. - The focus on achieving a $100 million run-rate reflects the company's strategic initiatives aimed at scaling operations and enhancing profitability [1].

Financial Performance - Net sales for the three months ended September 30, 2025, were $13,654,000, a 10.8% increase from $12,318,000 in the same period of 2024[13] - Gross profit for the nine months ended September 30, 2025, was $7,709,000, compared to $7,501,000 for the same period in 2024, reflecting a growth of 2.8%[13] - The company reported a net loss of $2,014,000 for the three months ended September 30, 2025, compared to a net income of $34,000 in the same period of 2024[13] - For the nine months ended September 30, 2025, the company reported revenue of $41,244,000, a decrease of 11.5% compared to $46,635,000 in the same period of 2024[52] - The net loss for the nine months ended September 30, 2025, was $(3,718,000), compared to a net loss of $(1,189,000) for the same period in 2024, indicating a significant increase in losses[52] - The company reported a loss from operations before taxes of $2,014 million for the three months ended September 30, 2025, compared to a loss of $39 million in the same period of 2024[84] Assets and Liabilities - Total assets increased to $58,483,000 as of September 30, 2025, up from $47,221,000 on December 31, 2024, representing a growth of 23.8%[11] - Total current liabilities rose to $20,020,000 as of September 30, 2025, from $12,550,000 on December 31, 2024, indicating a 59.5% increase[11] - The accumulated deficit as of September 30, 2025, was $(201,249,000), up from $(196,102,000) at the end of 2024[11] - The company's working capital as of September 30, 2025, was $2.8 million, excluding the current portion of long-term debt[53] - As of September 30, 2025, the company had $7.2 million in long-term debt, with $3.7 million due within the next 12 months[63] - The balance outstanding on the line of credit was $8.3 million as of September 30, 2025, compared to $6.3 million as of December 31, 2024[62] Cash Flow and Financing - Cash flows used in operating activities amounted to $(3,992,000) for the nine months ended September 30, 2025, compared to cash flows provided of $1,087,000 for the same period in 2024[17] - The company generated net proceeds of approximately $3,252,000 from its public offering of 1,250,000 shares of common stock at a price of $4.00 per share on March 7, 2025[20] - Capstone's financing activities provided cash flows of $7,152,000, contrasting with $(1,024,000) in the previous year[17] - The company raised $7.2 million from financing activities for the nine months ended September 30, 2025, including $3.3 million from a public offering and $3.0 million from debt issuance[147] Acquisitions and Operations - Capstone acquired Carolina Stone Holdings, enhancing its operations in stone supply and installation services[19] - The aggregate purchase price for the acquisition of Carolina Stone Holdings was $2,625,000 in cash, plus a seller note of $1,250,000 and an earn-out agreement of up to $825,000[48] - The preliminary purchase price allocation for the identifiable assets acquired in the Carolina Stone Holdings acquisition included total identifiable net assets of $2,033 thousand and goodwill of $2,744 thousand[49] - The company operates a distribution network servicing 31 US states, with over 400 active customers primarily in masonry and building materials[91] Expenses - The cost of goods sold for the three months ended September 30, 2025, was $10,400,000, an increase from $9,325,000 in the same period of 2024[13] - Selling, general, and administrative expenses for the three months ended September 30, 2025, totaled $3,370 million, up from $2,580 million in the same period of 2024, indicating a rise of 30.7%[84] - Selling, general and administrative expenses increased by $1.7 million, or 22%, for the nine months ended September 30, 2025, primarily due to a $1.0 million increase in investor relations and the acquisition of Carolina Stone Holdings[129] Shareholder and Equity Changes - The weighted average number of common shares outstanding increased to 5,700,214 for the three months ended September 30, 2025, compared to 157,610 in the same period of 2024[13] - On the Restructuring Date, TotalStone's Class B and Class C Preferred Interests were exchanged for 3,782,641 shares of Common Stock, representing approximately 96% of the outstanding shares[23] - Following the restructuring, BP Peptides, LLC's ownership in Capstone decreased from approximately 77.3% to about 3%, while BPA XIV, LLC became the largest shareholder with approximately 64%[23] Legal and Compliance - The company is currently not aware of any legal proceedings that would have a material adverse effect on its business or financial condition[158] - There have been no material changes to the risk factors previously disclosed in the Form 10-K[159] - The company has no off-balance sheet arrangements as defined by SEC regulations[151] Miscellaneous - The company plans to continue growing its business organically and through well-timed acquisitions[97] - The company executed an amendment to its Revolver in June 2025, extending the maturity date from June 2025 to December 2025[54] - The company has a consulting agreement with Brookstone Partners IAC, Inc., with annual fees totaling $400,000 and additional management fees based on EBITDA exceeding $4 million[59]

Financial Results - Capstone Holding Corp. reported its financial results for Q3 2025 on November 17, 2025[4] - The press release detailing the financial results was inadvertently sent to the email distribution list prior to its official issuance[5] Company Classification - The company is classified as an emerging growth company under the Securities Act[3]