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]
Capstone Holding Corp(CAPS) - 2025 Q3 - Quarterly Report