Capstone Awarded Eldorado Stone Distribution, Targeting $5 Million in Organic Revenue Growth

Key Terms

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operating leverage financial

Operating leverage measures how much a company's profits are affected by changes in sales volume. When a business has high operating leverage, small increases in sales can lead to much larger increases in profit, much like a lever amplifies force. It matters to investors because it indicates how sensitive a company's earnings are to fluctuations in sales, affecting risk and potential returns.

margin expansion financial

Margin expansion means a company is keeping a larger share of each dollar it earns — like a baker finding ways to bake the same loaf with lower ingredient or energy costs so more of the sale price becomes profit. For investors this matters because wider margins usually lead to higher reported profits, stronger cash flow and a healthier cushion against downturns, which can support higher stock valuations and reduce risk.

share-of-wallet financial

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$5 million in organic revenue sold through existing distribution channels with no incremental investment; share-of-wallet capture from existing customers accelerates near-term revenue ramp

NEW YORK--(BUSINESS WIRE)-- Capstone Holding Corp. (NASDAQ: CAPS), a tech-enabled building products distribution platform, today announced it has been awarded distribution rights for Eldorado Stone, a premium manufactured stone veneer brand from Westlake Royal Building Products. The Company expects the addition will contribute $5 million in annualized run-rate revenue by Q3 2027, sold entirely through Capstone’s existing distribution channels with no incremental infrastructure investment.

Capstone is already a top-three national distributor of Westlake’s Cultured Stone brand. The Eldorado award expands that relationship, adding a second premium stone veneer brand to Capstone’s portfolio and reflecting the Company’s proven ability to grow leading brands through its national distribution platform. Eldorado Stone has more than 50 years of market presence and is one of the most widely specified manufactured stone veneer brands in North America.

The addition of Eldorado expands Capstone’s addressable market and creates immediate opportunities to capture existing customer spend currently flowing to competing distributors. Many of Capstone’s current customers already purchase Eldorado products elsewhere, and the brand is frequently specified by architects and designers, driving inbound demand that opens new customer accounts without incremental sales cost.

Eldorado Stone will be sold through Capstone’s existing distribution network, increasing revenue per customer and per delivery route without requiring incremental fixed cost investment. The addition represents the latest example of the Company’s platform realizing operating leverage and margin expansion from its scaled national distribution infrastructure.

“The addition of Eldorado Stone is a significant organic growth driver for our business,” said Matthew Lipman, Chief Executive Officer of Capstone. “We’ve built a strong track record distributing Cultured Stone, and Westlake’s decision to expand our portfolio with Eldorado reflects confidence in our platform and our ability to grow premium brands. This is $5 million in revenue that requires no acquisition cost and flows through a cost structure that is already in place.”

Key Highlights:

• $5 Million in Organic Revenue Growth: The Company expects the Eldorado Stone addition will contribute $5 million in annualized run-rate revenue by Q3 2027. This revenue is organic, requires no acquisition cost, and flows through Capstone’s existing distribution infrastructure at high incremental margins.
• Deepening Relationship with Westlake Royal Building Products: Capstone is already a top-three national distributor of Westlake’s Cultured Stone brand. The Eldorado distribution award adds a second premium brand to the portfolio, reflecting Capstone’s established execution record and positioning the Company for additional portfolio expansion over time.
• Share-of-Wallet Capture from Existing Customers: Many of Capstone’s existing customers currently purchase Eldorado products from competing distributors. The distribution award creates an immediate opportunity to redirect that spend onto Capstone’s platform, increasing revenue per account and strengthening customer relationships.
• New Customer Acquisition Through Architect Specification: Eldorado Stone is widely specified by architects and designers, generating inbound demand that expands Capstone’s addressable customer base. New accounts opened through Eldorado specifications create additional cross-selling opportunities for Capstone’s full product portfolio, including Cultured Stone.
• Operating Leverage and Margin Expansion: Eldorado Stone is sold through Capstone’s existing distribution channels, increasing revenue per customer and per delivery route without incremental warehouse, logistics, or headcount investment. Incremental Eldorado revenue is expected to convert to EBITDA at significantly higher margins than the Company’s blended average.
• Accelerating Platform Momentum: The Eldorado Stone addition compounds accelerating growth across Capstone’s platform. The Company has recently announced multi-year homebuilder programs representing more than 300,000 square feet of annualized demand, a $2 million cost rationalization program delivering results, and a national commercial sales partnership. Management targets a positive corporate EBITDA run-rate beginning in Q2 2026, driven by the combination of Eldorado, recent homebuilder wins, and the Company’s cost rationalization program.

“Our business is at an inflection point,” Lipman added. “The scale and operating leverage we built in 2025 is now driving meaningful volume growth across the platform at higher margins. The Eldorado award, alongside our homebuilder project wins and cost discipline, strongly reinforces our confidence in Capstone’s growth and earnings trajectory in 2026 and beyond.”

Capstone expects to publish an Earnings Power Presentation following its 2025 annual report, outlining organic growth momentum and management’s vision for building a technology leader in the building products sector.

About Capstone Holding Corp.

Capstone Holding Corp. (NASDAQ: CAPS) is a national, technology-enabled building products distribution platform optimizing supply chains across 38 U.S. states and Canada. Through its Instone operating platform and inventory portal, the Company aggregates and delivers proprietary stone veneer, hardscape materials, and modular masonry systems. Capstone’s model combines digital infrastructure, owned-inventory logistics, and disciplined acquisitions to drive scalable margin expansion and operating leverage across its growing platform.

About Eldorado Stone

Eldorado Stone, a brand of Westlake Royal Building Products (a Westlake Corporation company, NYSE: WLK), has been a leader in premium manufactured stone veneer for more than 50 years. Headquartered in Oceanside, California, Eldorado Stone products are handcrafted to replicate the nuanced beauty of natural stone, delivering premium architectural surfaces for residential and commercial applications. For more information, visit westlakeroyalbuildingproducts.com/stone/eldorado-stone.

Forward-Looking Statements

This press release contains forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. These statements relate to future events and performance, including guidance regarding revenue and EBITDA targets, M&A strategy, use of capital, and operating outlook. Actual results may differ materially from those projected due to a range of factors, including but not limited to acquisition timing, macroeconomic conditions, and execution risks. Please review the Company’s filings with the SEC for a full discussion of risk factors. Capstone undertakes no obligation to revise forward-looking statements except as required by law.

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Capstone Holding Corp.
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Source: Capstone Holding Corp.