Capstone Companies, Inc. Reports Record Revenue in 2013

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| Source: Capstone Companies, Inc.
  • Fourth quarter revenue increased 189% to $7.3 million; Full-year revenue improved 75%
  • Full-year gross profit more than doubled to $3.6 million or 24.7% of sales
  • Full-year net income was $0.7 million compared with a net loss of $0.6 million in 2012

DEERFIELD BEACH, Fla., March 27, 2014 (GLOBE NEWSWIRE) -- Capstone Companies, Inc. (OTCQB:CAPC) ("Capstone" or the "Company"), a leader in the design and manufacture of specialty power failure lighting solutions and innovator of consumer safety and security products for the Hospitality, Retail and Institutional channels, reported fourth quarter unaudited 2013 financial results.

Gerry McClinton, Capstone's CFO, commented, "As a result of the successful implementation of our domestic distribution program and product launches during the year, we achieved record revenue for the fourth quarter and full year of 2013 as well as positive operating and net income."

Fourth Quarter 2013 Highlights

  • Revenue was $7.3 million, an increase of 189% from the prior-year period.
  • Gross profit increased $1.2 million, or 261%, to $1.7 million compared with the fourth quarter of 2012.
  • Net income improved significantly to $0.7 million compared with net loss of $0.2 million in the fourth quarter 2012.

2013 Highlights

  • Record revenue of $14.6 million, increased $6.2 million, or 75%, from 2012.
  • Gross profit more than doubled to $3.6 million, or 24.7% of sales, from $1.8 million, or 21.4% of sales, in 2013.
  • Net income was $0.7 million compared with a net loss of $0.6 million in 2012.

Strategic Growth Initiatives Taking Hold

The strategic initiatives implemented during the last several years have resulted in measurably improved top line results and profitability. The Company is continuing to make incremental investments in alignment with existing strategic goals, including increasing brand awareness, the expansion of Capstone International's Hong Kong operations and widening the product distribution channels both domestically and into overseas markets. Additionally, through investment and collaboration with AC Kinetics, the Company has developed new intellectual property which provides a roadmap for the expansion of power failure lighting solutions into new and innovative applications, serving our customers needs with more efficient and forward trending designs.

Stewart Wallach, Capstone's CEO noted, "Our strategic investments are beginning to yield favorable results and we have several upcoming major milestones, providing a clear pathway to additional growth on the horizon. I am particularly encouraged by the new products that will utilize the patent pending technology developed through our collaboration with AC Kinetics. We are pressing to debut the initial round of these products ahead of this year's Hardware Show on May 6th.

"2013 was clearly a year of accomplishments for Capstone and the Company's momentum has never been stronger. 2014 will mark the most exciting and extensive product roadmap in the Company's history. While remaining focused on the safety and security categories, we are extending our lighting applications which will enable us to serve more departments within the retail environment. Our company continues to execute its long-term plan and maintain its commitment and belief in building value through strong fundamental performance."

He added, "I encourage you all to join us on our webcast and conference call tomorrow morning to learn more about the exciting things we are doing to build on the successes of 2013 and drive further growth."

Webcast and Teleconference to Review Results and Outlook

The Company will host a live webcast and conference call on Friday, March 28, 2014 at 11:30 a.m. ET. During the call, management will review the financial and operating results and discuss the Company's corporate strategy and outlook, followed by a question-and-answer session. The conference call can be accessed by dialling (201) 689-8562. The listen-only audio webcast can be monitored at www.capstonecompaniesinc.com.

A telephonic replay will be available from 2:30 p.m. ET the day of the teleconference until Friday April 4, 2014. To listen to the replay of the call, dial (858) 384-5517 and enter replay pin number 13577714. Alternatively, the archive of the webcast will be available on the Company's website at www.capstonecompaniesinc.com. A transcript will also be posted to the website, once available. 

About Capstone Companies, Inc.

Capstone Companies, Inc. is a public holding company that engages, through its wholly-owned subsidiaries, Capstone Industries, Inc., Capstone Lighting Technologies, LLC, and Capstone International HK, Ltd., in the development, manufacturing, logistics, and distribution of consumer and institutional products to accounts throughout North America and in international markets. See www.capstonecompaniesinc.com for more information about the Company and www.capstoneindustries.com for information on our current product offerings.

FORWARD-LOOKING STATEMENTS:

This news release contains "forward-looking statements" as that term is defined in the Private Securities Litigation Reform Act of 1995, as amended. Such statements consist of words like "anticipate," "expect," "project," "continue" and similar words. These statements are based on the Company's and its subsidiaries' current expectations and involve risks and uncertainties, which may cause results to differ materially from those set forth in the forward-looking statements. Factors that may cause actual results to differ materially from those contemplated by such forward-looking statements, include consumer acceptance of the Company's products, its ability to deliver new products, the success of its strategy to broaden market channels and the relationships it has with retailers and distributors. Prior success in operations does not necessarily mean success in future operations. The ability of the Company to adequately and affordably fund operations and any growth will be critical to achieving and sustaining any expansion of markets and revenue. The introduction of new products or the expanded availability of products does not mean that the Company will enjoy better financial or business performance. The risks associated with any investment in Capstone Companies, Inc., which is a small business concern and a "penny-stock Company" and, as such, a highly risky investment suitable for only those who can afford to lose such investment, should be evaluated together with the risks and uncertainties more fully described in the Company's Annual and Quarterly Reports filed with the Securities and Exchange Commission. Capstone Companies, Inc. undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise. Contents of referenced URL's are not incorporated into this press release.

FINANCIAL TABLES FOLLOW. THE FOLLOWING SUMMARY FINANCIAL STATEMENT SHOULD BE READ ALONG WITH THE FORM 10-K FINANCIAL STATEMENT FILED BY THE COMPANY WITH THE SECURITIES AND EXCHANGE COMMISSION.

CAPSTONE COMPANIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
         
  For the Three Months Ended For the Twelve Months Ended
  December 31, December 31,
  2013 2012 2013 2012
         
Revenues $7,253,037 $2,512,045 $14,593,826 $8,362,964
Cost of Sales (5,584,423) (2,050,019) (10,983,364) (6,574,912)
 Gross Profit 1,668,614 462,026 3,610,462 1,788,052
 Gross Margin 23.0% 18.4% 24.7% 21.4%
         
Operating Expenses:        
 Sales and marketing 279,572 147,220 489,791 364,263
 Compensation 282,222 229,491 972,922 900,628
 Professional fees 56,402 94,487 326,077 269,335
 Product Development 68,165 35,033 225,754 227,087
 Other general and administrative 175,684 99,851 479,298 359,795
 Total Operating Expenses 862,045 606,082 2,493,842 2,121,108
         
Net Operating Income (Loss) 806,569 (144,056) 1,116,620 (333,056)
 Operating Margin 11.1% -5.7% 7.7% -4.0%
         
Other Income (Expense):        
 Interest expense (123,776) (91,677) (389,486) (274,127)
 Total Other Income (Expense) (123,776) (91,677) (389,486) (274,127)
         
Net Income (Loss) $682,793  $ (235,733) $727,134  $ (607,183)
         
Income (Loss) per Common Share  $  --   $ --   $ --   $   -- 
         
Weighted Average Shares Outstanding        
Basic 86,558 877,398 657,503,683 650,724,916
Diluted 86,558 727,398 813,450,260 810,671,493
         
         
CAPSTONE COMPANIES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
     
  (Unaudited)  
  December 31 , December 31,
  2013 2012
Assets:    
Current Assets:    
 Cash $436,592 $411,259
 Accounts receivable – net 6,927,238 2,673,555
 Inventory 298,099 584,370
 Prepaid expense 1,082,784 351,003
 Total Current Assets 8,744,713 4,020,187
     
Fixed Assets:    
 Computer equipment & software 66,448 66,448
 Machinery and equipment 667,096 654,401
 Furniture and fixtures 5,665 5,665
 Less: Accumulated depreciation (661,210) (597,042)
 Total Fixed Assets 77,999 129,472
     
Other Non-current Assets:    
 Product development costs – net 19,664 27,280
 Investment (AC Kinetics) 500,000  -- 
 Goodwill 1,936,020 1,936,020
 Total Other Non-current Assets 2,455,684 1,963,300
 Total Assets $11,278,396 $6,112,959
     
Liabilities and Stockholders' Equity:    
Current Liabilities:    
 Accounts payable and accrued expenses $1,931,527 $1,114,166
 Note payable - Sterling Factors 4,237,144 1,245,159
 Notes and loans payable to related parties - current maturities 3,220,074 602,148
 Total Current Liabilities 9,388,745 2,961,473
     
Long-Term Liabilities    
 Notes and loans payable to related parties - Long Term  --  2,023,283
 Total Liabilities 9,388,745 4,984,756
     
Commitments and Contingent Liabilities (Note 5)    
     
Stockholders' Equity:    
 Preferred Stock, Series A, par value $.001 per share, authorized 100,000,000 shares, issued -0- shares  --   -- 
 Preferred Stock, Series B-1, par value $.0001 per share, authorized 50,000,000 shares, issued -0- shares  --   -- 
 Preferred Stock, Series C, par value $1.00 per share, authorized 1,000 shares, issued 1,000 shares 1,000 1,000
 Common Stock, par value $.0001 per share, authorized 850,000,000 shares, 657,760,532 & 655,885,532 shares issued at December 31, 2013 & December 31, 2012 65,777 65,589
 Additional paid-in capital 7,172,059 7,137,933
 Accumulated deficit (5,349,185) (6,076,319)
 Total Stockholders' Equity 1,889,651 1,128,203
 Total Liabilities and Stockholders' Equity $11,278,396 $6,112,959
     
     
CAPSTONE COMPANIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
     
  For the Year Ended December 31,
  2013 2012
CASH FLOWS FROM OPERATING ACTIVITIES:    
Continuing operations:    
 Net Income (Loss) $727,134  $ (607,183)
 Adjustments necessary to reconcile net loss to net cash used in operating activities:    
 Stock issued for expenses 14,064 59,963
 Depreciation and amortization 95,756 71,153
 Compensation expense from stock options 20,250 36,750
 (Increase) decrease in accounts receivable (4,253,683) (1,196,276)
 (Increase) decrease in inventory 286,271 (525,653)
 (Increase) decrease in prepaid expenses (731,781) 66,740
 (Increase) decrease in other assets (23,972) (33,960)
 Increase (decrease) in accounts payable and accrued expenses 817,361 587,230
 Increase (decrease) in accrued interest on notes payable 104,643 144,216
 Net cash provided by (used in) operating activities (2,943,957) (1,397,020)
     
CASH FLOWS FROM INVESTING ACTIVITIES:    
Investment (500,000)  -- 
Purchase of property and equipment (12,695) (109,883)
Net cash provided by (used in) investing activities (512,695) (109,883)
     
CASH FLOWS FROM FINANCING ACTIVITIES:    
Proceeds from notes payable 12,737,405 7,568,000
Repayments of notes payable (9,745,420) (6,764,448)
Proceeds from notes and loans payable to related parties 4,538,000 3,043,000
Repayments of notes and loans payable to related parties (4,048,000) (2,093,000)
Net cash provided by financing activities 3,481,985 1,753,552
     
Net (Decrease) Increase in Cash and Cash Equivalents 25,333 246,649
Cash and Cash Equivalents at Beginning of Period 411,259 164,610
Cash and Cash Equivalents at End of Period $436,592 $411,259
     
For more information contact
Company:
Aimee Gaudet
Corporate Secretary
(954) 252-3440, ext 313

Investor Relations:
Garett Gough, Kei Advisors LLC
(716) 846-13352