Capstone Holding Corp. (CAPS) Q2 2025 Earnings Call

Investor webinar replay

Replay transcript excerpt

Welcome to Capstone Holding Corp's second quarter 2025 earnings presentation. Capstone is built to deliver, positioned to acquire, and ready to scale. This slide is our preamble and summary of our legal disclosure. The following content is fully qualified by the legal disclosures on the next two slides. Our goal is to share with some of the strategic thinking and financial analysis we've been using to guide the growth of our business. This content aligns with our principles of being accountable and transparent with our shareholders. We operate in a hyper-dynamic environment. That's a fancy way of saying things change quickly. What we're telling you today is based on our best estimates and assumptions. We reserve the right to revise our views as new information becomes available. Despite uncertainty, we must plan. must make operating and investment decisions. This presentation lays out some of that thinking for your review. In Q2, InStone delivered significant margin expansion and earnings growth. Revenue was essentially flat year but gross profit increased 13%. Gross margin improved from 21.4% to 24.4%, driven by growth in our owned higher margin brands. EBITDA more than doubled, up 120% from 374,000 in Q2 2024 to 839,000 in Q2 2025. Adjusted net income swung from a loss of $129,000 last year to a positive $308,000 this year. This quarter demonstrates the strength of our brand strategy and disciplined SG&A control. Today we signed the agreement to acquire Carolina Stone Products, a leading stone veneer installer and distributor in North Carolina. The deal is expected to close within 10 days. Revenue is approximately $11 million with trailing EBITDA of approximately $750,000. By 2026, we expect Carolina Stone to contribute a million dollars in EBITDA. This is an immed...