Capstone Sees Minimal Effect from China Tariffs, Decrease in Container Prices Offsets Tariffs

Rhea-AI Summary

Capstone Holding Corp (NASDAQ:CAPS) reports that while facing increased tariffs on Chinese imports, the company has experienced offsetting benefits from reduced container shipping costs. Container prices from China to the USA have dropped by 15% to 25% since the start of the year.

According to Instone CEO Kevin Grotke, the 10% tariff typically results in only a 3-4% price increase to customers, as tariffs apply solely to product costs, not freight. The decrease in shipping costs effectively neutralizes the current tariff impact.

Capstone Holding CEO Matt Lipman expressed confidence in the company's adaptable supply chain, which has proven resilient through previous challenges. Despite economic concerns, the company anticipates a strong 2025, citing factors such as declining interest rates, addressing housing shortages, and continued remodeling expenditures.

Positive

• Shipping cost decrease of 15-25% fully offsets impact of increased tariffs
• Demonstrated supply chain resilience and adaptability
• Minimal pass-through of tariffs to customers (only 3-4% increase from 10% tariff)

Negative

• Increased tariffs on Chinese imports affecting product costs

ALSIP, ILLINOIS / ACCESS Newswire / March 20, 2025 / Capstone Holding Corp (NASDAQ:CAPS), a building products holding company growing organically and by acquisition, has seen tariffs on its products imported from China increase in line with presidential orders. However, since the beginning of the year prices of containers from China to the USA have declined between 15% to 25%.

As Kevin Grotke, CEO of the Instone operating business explained, "There is a fair amount of freight in our products and only the product cost is subject to tariff. So a 10% tariff typically will create a price increase to the customer of 3%-4%. With a 15% to 25% decline in container pricing, the tariffs as currently constructed are offset by decreased shipping costs."

Matt Lipman CEO of Capstone Holding added "Kevin and his team have continued to demonstrate that the company has a nimble supply chain that was battle tested through Covid and the first Trump Administration's tariff regime. Despite the recent economic rhetoric, as interest rates decline, the housing shortage remedied and remodeling expenditures continue, we expect 2025 to be a solid year."

About Capstone Holding Corp.

Capstone Holding Corp. is a building products distribution company that has successfully grown its business organically and through well-timed acquisitions. We intend to use the distribution backbone of our operating subsidiary, Instone, which currently services 31 US states, to provide a value-added platform to make acquisitions. A key differentiator of the Company's strategy is that it maintains over half of its revenue from brands it owns or controls. Current products include stone veneers, landscape stone, and modular masonry fireplaces.

Capstone's corporate headquarters is located in Alsip, Illinois.

Forward-Looking Statements

Statements in this press release which are forward-looking and provide other than historical information, including but not limited to expected trading of our Common Stock on the Nasdaq Capital Market and the expected closing of the Offering, are based on current conditions and information available as of the date hereof. Although its management believes that the expectations reflected in those forward-looking statements are reasonable, management can give no assurance that those expectations will prove to be correct. Those forward-looking statements are made based on various underlying assumptions and are subject to numerous uncertainties and risks, including, without limitation, such factors described under the captions "Cautionary Note Regarding Forward-Looking Statements" and "Risk Factors" included in Capstone's filings with the Securities and Exchange Commission (the "SEC") (www.sec.gov). Capstone undertakes no obligation to update the information contained herein to reflect subsequently occurring events or circumstances, except as required by applicable securities laws and regulations.

Contact:

Matthew Lipman
Chief Executive Officer
Capstone Holding Corp
Email: investors@capstoneholdingcorp.com
Website: www.capstoneholdingcorp.com

SOURCE: Capstone Holding Corp.

View the original press release on ACCESS Newswire

FAQ

How much have container shipping prices from China decreased for Capstone (CAPS) in 2025?

Container prices from China to USA have declined between 15% to 25% since the beginning of 2025.

What is the actual impact of 10% China tariffs on Capstone's (CAPS) customer prices?

A 10% tariff typically results in only a 3-4% price increase to customers, as tariffs apply only to product costs, not freight.

How is Capstone (CAPS) managing the impact of increased Chinese tariffs in 2025?

The increased tariffs are being offset by decreased shipping costs, with container price reductions of 15-25% neutralizing the tariff impact.

What factors support Capstone's (CAPS) positive outlook for 2025?

Declining interest rates, addressing housing shortages, and continued remodeling expenditures are key factors supporting their positive outlook.