FSI ANNOUNCES FOURTH QUARTER AND FULL YEAR 2023 REVENUE

Rhea-AI Summary

Flexible Solutions International, Inc. (FSI) announces a decrease in revenue for the fourth quarter and full year of 2023, with sales dropping by approximately 24% year over year in Q4 and a full year decrease of 17%. The CEO attributes this to the company's raw material inventory costs and customer expectations. FSI plans to recover margins and resume growth in 2024.

Positive

• None.

Negative

• 24% decrease in Q4 revenue compared to the previous year
• 17% decrease in full year revenue compared to the previous year

Insights

Market Research Analyst

FSI's reported decline in year-over-year revenue for both Q4 and the full year of 2023 signifies a contraction in its business operations. This contraction could be attributed to various market factors, including potentially increased competition, shifts in demand for biodegradable polymers and operational inefficiencies. It is crucial to scrutinize the company's cost structure and pricing strategies, particularly in light of the CEO's statement regarding the impact of raw material costs and pricing pressures from customers.

Understanding the broader market trends for biodegradable materials and water treatment solutions will be essential to assess FSI's potential for recovery. The increasing global emphasis on sustainability suggests a growing market for such products, but it also invites more competitors into the space. Investors should monitor FSI's innovation pipeline and its ability to secure contracts that could buffer against market volatility.

Financial Analyst

FSI's significant revenue drop poses concerns about its financial health and operational resilience. A 24% decrease in Q4 and a 17% decrease for the full year are substantial, especially when compared to industry norms where single-digit fluctuations are more common. The reduced revenue will likely impact the company's profitability and could constrain its ability to invest in R&D or expand its market presence.

Investors should anticipate the full financial results to evaluate the company's liquidity position, debt levels and cash flow status. The CEO's optimistic outlook for Q1 2024 suggests that the company may have strategies in place to mitigate the impact of raw material costs and improve margins. However, it is imperative to review the actual performance data once released and compare it with the CEO's forward-looking statements.

Economist

The scenario described by FSI's CEO, where the company is squeezed by high input costs and customer expectations for lower prices, is indicative of a classic cost-price squeeze. This situation can arise in periods of economic volatility, where commodity prices fluctuate widely, affecting both the supply chain and consumer markets. An economist would analyze this within the context of macroeconomic conditions, such as inflation rates, commodity price trends and the overall health of the industrial sector FSI serves.

Long-term implications for FSI's business model may include the need for more flexible pricing strategies or hedging against raw material price volatility. Furthermore, the company's expansion into the food and nutrition supplement markets could be a strategic diversification to reduce reliance on the more volatile sectors of oil extraction and water treatment.

VICTORIA, BRITISH COLUMBIA, Jan. 22, 2024 (GLOBE NEWSWIRE) -- FLEXIBLE SOLUTIONS INTERNATIONAL, INC. (NYSE-AMERICAN: FSI), is the developer and manufacturer of biodegradable polymers for oil extraction, detergent ingredients and water treatment as well as crop nutrient availability chemistry. Flexible Solutions also manufactures biodegradable and environmentally safe water and energy conservation technologies. FSI is also increasing its presense in the food and nutrition supplement manufacturing markets. Today the Company announces fourth quarter (Q4) and full year, 2023 revenue.

Sales were lower in Q4, 2023 compared to Q4, 2022. Flexible Solutions’ top line revenue decreased from $12.20 million (Q4, 2022) to $9.22 million (Q4, 2023), down approximately 24% year over year. Full year revenue decreased from $45.8 million in 2022 to $38.1 million in 2023, a full year decrease of 17%.

Mr. Dan O’Brien, CEO, comments, “Like many companies in 2023, FSI was caught between the prices we paid for raw materials inventory in 2022/2023 and customer expectations that since prices were dropping, ours should as well, regardless of our cost of goods.” Mr. O’Brien continues, “We believe that this storm will pass in Q1 2024 and FSI should resume growth and recover margins throughout 2024.”

Complete financial results will be available after market close on March 29, 2024 concurrent with the Company’s SEC full year filings. A conference call will be scheduled for 8:00 am Pacific Time, 11:00 am Eastern Standard Time, the following business day, Monday, April 1, 2024. See the FSI March 29, 2024 financials news release for the dial in numbers.

About Flexible Solutions International

Flexible Solutions International, Inc. (www.flexiblesolutions.com), based in Victoria, British Columbia, is an environmental technology company. The Company’s NanoChem Solutions Inc. subsidiary specializes in biodegradable, water-soluble products utilizing thermal polyaspartate (TPA) biopolymers. TPA beta-proteins are manufactured from the common biological amino acid, L-aspartic and have wide usage including scale inhibitors, detergent ingredients, water treatment and crop enhancement. Along with TPA, this division started producing other crop enhancement products as well. The other divisions manufacture energy and water conservation products for drinking water, agriculture, industrial markets and swimming pools throughout the world. FSI is the developer and manufacturer of WaterSavr^TM, the world’s first commercially viable water evaporation retardant. WaterSavr^TM reduces evaporation by up to 30% on reservoirs, lakes, aqueducts, irrigation canals, ponds and slow moving rivers. Heatsavr^TM, a “liquid blanket” evaporation retardant for the commercial swimming pool and spa markets, reduces energy costs by 15% to 40% and can result in reduced indoor pool humidity.

Safe Harbor Provision

The Private Securities Litigation Reform Act of 1995 provides a "Safe Harbor" for forward-looking statements. Certain of the statements contained herein, which are not historical facts, are forward looking statement with respect to events, the occurrence of which involve risks and uncertainties. These forward-looking statements may be impacted, either positively or negatively, by various factors. Information concerning potential factors that could affect the company is detailed from time to time in the company's reports filed with the Securities and Exchange Commission.

Flexible Solutions International
6001 54^th Ave, Taber, Alberta, CANADA T1G 1X4

Company Contacts

Jason Bloom
Toll Free: 800.661.3560
Fax: 403.223.2905
Email: info@flexiblesolutions.com

To find out more information about Flexible Solutions and our products please visit www.flexiblesolutions.com

If you have received this news release by mistake or if you would like to be removed from our update list please reply to: info@flexiblesolutions.com

FAQ

What is the ticker symbol for Flexible Solutions International, Inc.?

The ticker symbol for Flexible Solutions International, Inc. is FSI.

What was the revenue decrease for Q4, 2023 compared to Q4, 2022?

The revenue decreased by approximately 24% in Q4, 2023 compared to Q4, 2022.

What was the full year revenue decrease from 2022 to 2023?

The full year revenue decreased by 17% from 2022 to 2023.

When will the complete financial results be available?

The complete financial results will be available after market close on March 29, 2024.

When is the scheduled conference call for discussing the financial results?

The conference call is scheduled for 8:00 am Pacific Time, 11:00 am Eastern Standard Time, the following business day, Monday, April 1, 2024.