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Capstone Companies, Inc. Reports 42% Sales Growth Year to Date Through Second Quarter 2013

Capstone Companies, Inc. logo

DEERFIELD BEACH, Fla., Aug. 13, 2013 (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 second quarter unaudited 2013 financial results.

Stewart Wallach, Capstone's CEO, commented, "Our brand recognition efforts are continuing to gain steam during the second quarter. We are getting more traction with the large retail chains in the U.S. and now have an increased presence in most of the highly recognized big box stores."

Second Quarter 2013 Highlights

  • Revenue was $1,027,000 in the second quarter of 2013, an increase of 21% from the prior-year period.
  • Gross profit increased to $197,000, up 5% from $187,000 in the second quarter of 2012.
  • Net loss was $499,000 compared with net loss of $361,000 in the second quarter 2012.

2013 Year to Date Review

  • Revenue was $1,687,000, an increase of $499,000, or 42%, from $1,188,000 in the 2012 first half.
  • Gross profit was up $96,000 to $391,000 over the first six months of 2012.
  • Net loss was $885,000 compared with a net loss of $709,000 in 2012's first half.

Continuing to Invest in Strategic Growth Initiatives

The Company is progressing along the strategic path for growth through increased brand awareness and product development. Continued investments to improve the Company's capabilities and technologies are needed to maintain sales growth momentum through geographic expansion and new product introductions. The timing and rate of these future investments will be determined by the market opportunities identified by the management team.

Mr. Wallach noted, "We are seeing results from the strategic investments we have been making in the business. Our sales are significantly higher in the second quarter and first half, and we are making headway with our product development efforts. For example, our new 2-in-1 10 LED Wall Plate, which we debuted at the National Hardware Show in May 2013, has been selected by several major retail chains to be available in their stores across the country."

Webcast and Teleconference to Review Results and Outlook

The Company will host a live webcast and conference call on Wednesday, August 14, 2013 at 10:30 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 Wednesday, August 21, 2013. To listen to the replay of the call, dial (858) 384-5517 and enter replay pin number 417124. 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. 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-Q 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 Six Months Ended
June 30, June 30,
2013 2012 2013 2012
Revenues $ 1,027,121 $ 848,990 $ 1,686,916 $ 1,187,660
Cost of Sales (830,174) (661,873) (1,296,127) (892,660)
Gross Profit 196,947 187,117 390,789 295,000
Operating Expenses:
Sales and marketing 109,297 70,586 166,610 119,774
Compensation 238,693 224,424 468,787 444,504
Professional fees 113,733 53,555 205,457 100,878
Product Development 60,387 64,778 84,006 91,880
Other general and administrative 92,207 77,295 195,575 157,729
Total Operating Expenses 614,317 490,638 1,120,435 914,765
Net Operating Income (Loss) (417,370) (303,521) (729,646) (619,765)
Other Income (Expense):
Interest expense (81,381) (57,058) (155,085) (88,989)
Total Other Income (Expense) (81,381) (57,058) (155,085) (88,989)
Net Income (Loss) $ (498,751) $ (360,579) $ (884,731) $ (708,754)
Income (Loss) per Common Share $ -- $ -- $ -- $ --
Weighted Average Shares Outstanding
Basic 657,760,532 649,510,532 657,242,576 649,510,532
CAPSTONE COMPANIES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
June 30, December 31,
2013 2012
Assets:
Current Assets:
Cash $ 628,262 $ 411,259
Accounts receivable - net 1,047,280 2,673,555
Inventory 546,705 584,370
Prepaid expense 965,659 351,003
Total Current Assets 3,187,906 4,020,187
Fixed Assets:
Computer equipment & software 66,448 66,448
Machinery and equipment 661,596 654,401
Furniture and fixtures 5,665 5,665
Less: Accumulated depreciation (627,912) (597,042)
Total Fixed Assets 105,797 129,472
Other Non-current Assets:
Product development costs - net 36,114 27,280
Investment (AC Kinetics) 500,000 --
Goodwill 1,936,020 1,936,020
Total Other Non-current Assets 2,472,134 1,963,300
Total Assets $ 5,765,837 $ 6,112,959
Liabilities and Stockholders' Equity:
Current Liabilities:
Accounts payable and accrued expenses $ 516,051 $ 1,114,166
Note payable - Sterling Factors 297,235 1,245,159
Notes and loans payable to related parties - current maturities 4,674,764 602,148
Total Current Liabilities 5,488,050 2,961,473
Long Term Liabilities
Notes and loans payable to related parties - Long Term -- 2,023,283
Total Liabilities 5,488,050 4,984,756
Commitments and Contingent Liabilities
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 June 30, 2013 & December 31, 2012
65,778 65,589
Additional paid-in capital 7,172,059 7,137,933
Accumulated deficit (6,961,050) (6,076,319)
Total Stockholders' Equity 277,787 1,128,203
Total Liabilities and Stockholders' Equity $ 5,765,837 $ 6,112,959
CAPSTONE COMPANIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
For the Six Months Ended
June 30,
2013 2012
CASH FLOWS FROM OPERATING ACTIVITIES:
Continuing operations:
Net Income (Loss) $ (884,731) $ (708,754)
Adjustments necessary to reconcile net loss to net cash used in operating activities:
Stock issued for expenses 14,064 --
Depreciation and amortization 45,407 25,810
Compensation expense from stock options 20,250 16,500
(Increase) decrease in accounts receivable 1,626,275 706,451
(Increase) decrease in inventory 37,665 (517,656)
(Increase) decrease in prepaid expenses (614,655) (757,764)
(Increase) decrease in other assets (23,372) (4,346)
Increase (decrease) in accounts payable and accrued expenses (598,114) (70,516)
Increase (decrease) in accrued interest on notes payable 96,333 82,430
Net cash provided by (used in) operating activities (280,878) (1,227,845)
CASH FLOWS FROM INVESTING ACTIVITIES:
Investment (500,000) 0
Purchase of property and equipment (7,195) (2,401)
Net cash provided by (used in) investing activities (507,195) (2,401)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from notes payable 2,203,298 1,540,000
Repayments of notes payable (3,151,222) (1,801,281)
Proceeds from notes and loans payable to related parties 2,528,000 1,553,000
Repayments of notes and loans payable to related parties (575,000) --
Net cash provided by financing activities 1,005,076 1,291,719
Net (Decrease) Increase in Cash and Cash Equivalents 217,003 61,473
Cash and Cash Equivalents at Beginning of Period 411,259 164,610
Cash and Cash Equivalents at End of Period $ 628,262 $ 226,083
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the period for:
Interest $ 31,602 $ 6,560
Franchise and income taxes $ -- $ --

CONTACT: Company: Aimee Gaudet Corporate Secretary (954) 252-3440, ext 313 Investor Relations: Garett Gough, Kei Advisors LLC (716) 846-13352 ggough@keiadvisors.com

Source:Capstone Companies, Inc.