Press release

Capstone Companies Reports First Quarter 2019

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Capstone Companies, Inc. (OTC: CAPC) (“Capstone” or the “Company”), a
designer, manufacturer and marketer of consumer inspired products that
bridge technological innovations with today’s lifestyle reported its
financial results for the first quarter 2019.

Stewart Wallach, Capstone’s Chairman and CEO, commented, “2019 is off to
a good start as strong retail sell through of new LED products fuel the
Company’s backlog.”

Mr. Wallach added, “with our current backlog approximating all of 2018
sales, the Company pushes forward optimistically. The timing for the
addition of our new product portfolio couldn’t be better as our core
business remains stable and cash flows remain strong.”

Gerry McClinton, Capstone’s CFO, commented further, “our cash management
has enabled the Company to make significant investments in our 2019
growth strategies. While sales are growing, and our new product
portfolio evolves the Company continues to support these initiatives
without incurring debt in the quarter.”

Webcast and Teleconference to Review Results and Outlook

The Company will host a live webcast and conference call on Thursday,
May 16, 2019 at 10:30 a.m. Eastern Time. 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
dialing (201) 689-8562. The listen-only audio webcast can be monitored
at www.capstonecompaniesinc.com.

A telephonic replay will be available from 1:30 p.m. ET the day of the
call until Thursday, May 23, 2019. To listen to the archived call, dial
(412) 317-6671 and enter conference ID number 13686341. Alternatively,
the archive of the webcast will be available on the Company’s website at www.capstonecompaniesinc.com,
along with a transcript, 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,
Limited, in the development, manufacturing and marketing of consumer
product to retail channels throughout North America and international
markets.

Visit 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 URLs 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
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
       
For the Three Months Ended
March 31,
2019 2018
 
Revenues, net $ 2,978,802 $ 4,060,168
Cost of sales   (2,352,215)   (3,040,897)
Gross Profit   626,587   1,019,271
 
Operating Expenses:
Sales and marketing 191,875 363,061
Compensation 374,848 375,110
Professional fees 157,803 148,887
Product development 85,229 166,566
Other general and administrative   163,711   174,288
Total Operating Expenses   973,466   1,227,912
 
Operating Loss   (346,879)   (208,641)
 
Other Expenses, Net   (10,461)  
 
Loss Before Tax (Benefit) (357,340) (208,641)
 
(Benefit) for Income Tax   (12,000)   (18,000)
 
Net Loss $ (345,340) $ (190,641)
 
Net Loss per Common Share
Basic   ($0.007)   ($0.004)
Diluted   ($0.007)   ($0.004)
 
Weighted Average Shares Outstanding
Basic   47,033,670   47,046,364
Diluted   47,033,670   47,046,364
 
 
The accompanying notes are an integral part of these condensed
consolidated financial statements.
CAPSTONE COMPANIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
     
 
March 31, December 31,
2019 2018
Assets: (Unaudited)
Current Assets:
Cash $ 1,622,844 $ 3,822,359
Accounts receivable, net 2,376,699 64,511
Inventories 17,301 27,497
Prepaid expenses 76,724 243,876
Income tax refundable   220,207   220,207
Total Current Assets   4,313,775   4,378,450
 
Property and Equipment:
Computer equipment and software 51,195 51,195
Machinery and equipment 170,567 170,567
Furniture and fixtures 6,828 6,828
Less: Accumulated depreciation   (163,700)   (152,870)
Total Property & Equipment   64,890   75,720
 
Other Non-current Assets:
Deposit 103,193 102,805
Goodwill   1,936,020   1,936,020
Total Other Non-current Assets   2,039,213   2,038,825
Total Assets $ 6,417,878 $ 6,492,995
 
Liabilities and Stockholders’ Equity:
Current Liabilities:
Accounts payable and accrued liabilities $ 766,276 $ 461,446
Deferred rent incentive 83,827 108,844
Income tax payable   11,694   11,694
Total Current Liabilities   861,797   581,984
 
Long Term Liabilities:
Deferred tax liabilities     12,000
Total Long Term Liabilities     12,000
Total Liabilities   861,797   593,984
 
Commitments and Contingencies
 
Stockholders’ Equity:
Preferred Stock, Series A, par value $.001 per share, authorized
6,666,667 shares, issued -0- shares
Preferred Stock, Series B-1, par value $.0001 per share, authorized
3,333,333 shares, issued -0- shares
Preferred Stock, Series C, par value $1.00 per share, authorized 67
shares, issued -0- shares
Common Stock, par value $.0001 per share, authorized 56,666,667
shares, issued 47,000,894 shares at March 31, 2019 and 47,046,364
shares at December 31, 2018
4,701 4,704
Additional paid-in capital 7,094,632 7,092,219
Accumulated deficit   (1,543,252)   (1,197,912)
Total Stockholders’ Equity   5,556,081   5,899,011
Total Liabilities and Stockholders’ Equity $ 6,417,878 $ 6,492,995
 

The accompanying notes are an integral part of these condensed
consolidated financial statements.

CAPSTONE COMPANIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
FOR THE THREE MONTHS ENDED MARCH 31, 2019 AND MARCH 31, 2018
                                   
 
Preferred Stock Preferred Stock Preferred Stock Additional
Series A Series B Series C Common Stock Paid-In Accumulated Total
Shares Par Value   Shares Par Value   Shares Par Value   Shares Par Value Capital Deficit Equity
 
Balance at December 31, 2018 47,046,364 $   4,704 $   7,092,219 $   (1,197,912) $   5,899,011
Stock options for compensation 11,025 11,025
Repurchase of shares (45,470) (3) (8,612) (8,615)
Net (Loss)                                                   (345,340)         (345,340)
Balance at March 31, 2019     $     $     $     47,000,894     $   4,701       $   7,094,632       $   (1,543,252)     $   5,556,081
(Unaudited)
 
 
Balance at December 31, 2017 47,046,364 4,704 7,005,553 (186,854) $ 6,823,403
Stock options for compensation 28,875 28,875
Net (Loss)                                                   (190,641)         (190,641)
Balance at March 31, 2018     $     $     $     47,046,364     $   4,704       $   7,034,428       $   (377,495)     $   6,661,637
(Unaudited)
The accompanying notes are an integral part of these condensed
consolidated financial statements.
CAPSTONE COMPANIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
     
For the Three Months Ended
March 31,
2019 2018
CASH FLOWS FROM OPERATING ACTIVITIES:
 
Net loss $ (345,340) $ (190,641)
Adjustments to reconcile net (loss) to net cash provided by (used
in) operating activities:
Depreciation and amortization 10,830 9,133
Stock based compensation expense 11,025 28,875
Provision (benefit) for deferred income tax (12,000) 9,000
(Decrease) in accrued sales allowance (191,468) (20,635)
(Increase) decrease in accounts receivable, net (2,093,279) 1,689,880
Decrease in inventories 10,196 77,950
Decrease in prepaid expenses 167,152 160,569
(Increase) in deposits (388)
Increase (decrease) in accounts payable and accrued liabilities 277,389 (843,679)
(Decrease) in deferred rent incentive (25,017)
(Decrease) in income tax payable (613,088)
(Increase) in income tax refundable     (113,912)
Net cash provided by (used in) operating activities   (2,190,900)   193,452
 
CASH FLOWS FROM FINANCING ACTIVITIES:
Repurchase of Shares   (8,615)  
Net cash (used in) financing activities   (8,615)  
 
Net Increase (Decrease) in Cash (2,199,515) 193,452
Cash at Beginning of Period   3,822,359   3,668,196
Cash at End of Period $ 1,622,844 $ 3,861,648
 
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the period for:
Interest $ $
Income taxes $ $ 700,000
 
 
 
 
The accompanying notes are an integral part of these condensed
consolidated financial statements.