FSI ANNOUNCES SECOND QUARTER, 2024 FINANCIAL RESULTS

Rhea-AI Summary

Flexible Solutions International (NYSE Amex: FSI) reported its Q2 2024 financial results, showing improvement over the previous year. Key highlights include:

- Q2 sales increased by 2% to $10,528,739 compared to $10,331,291 in Q2 2023
- Net income rose to $1,289,796 ($0.10 per share) from $809,865 ($0.07 per share) in Q2 2023
- 6-month operating cash flow improved to $3,853,907 ($0.31 per share) from $3,220,674 ($0.26 per share) in the same period of 2023

The NanoChem division and ENP subsidiary remain the primary revenue and cash flow generators. The company is exploring new opportunities in various sectors to further increase sales.

Positive

• Q2 2024 sales increased by 2% year-over-year to $10,528,739
• Q2 2024 net income grew to $1,289,796, a 59% increase from Q2 2023
• Earnings per share improved from $0.07 in Q2 2023 to $0.10 in Q2 2024
• 6-month operating cash flow increased by 19.7% to $3,853,907 compared to the same period in 2023
• Operating cash flow per share rose from $0.26 to $0.31 year-over-year

Negative

• None.

Insights

Financial Analyst

FSI's Q2 2024 results show modest growth and improved profitability. Revenue increased by 2% year-over-year to $10.53 million, while net income jumped 59% to $1.29 million. Earnings per share rose from $0.07 to $0.10. The company's operating cash flow for the first half of 2024 improved to $3.85 million, up from $3.22 million in the same period last year.

While the revenue growth is minimal, the significant increase in profitability is noteworthy. This suggests improved operational efficiency or a more favorable product mix. The strong cash flow generation is also a positive sign, indicating healthy underlying business fundamentals.

Investors should monitor the progress of FSI's Food/Nutrition division, as management hinted at potential new revenue streams. This could be a catalyst for future growth if successful.

Market Research Analyst

FSI's performance in Q2 2024 reflects resilience in a challenging economic environment. The company's focus on biodegradable polymers and environmentally safe technologies aligns with growing market demand for sustainable solutions. The NanoChem division and ENP subsidiary remain key revenue drivers, but the company is actively exploring new opportunities in various sectors.

The mention of potential growth in detergent, food, nutraceuticals, oil field extraction and agricultural applications suggests a diversified market approach. This strategy could help mitigate risks associated with dependence on specific sectors. However, investors should be aware that entering new markets may require additional investments and could impact short-term profitability.

The company's ability to maintain growth and improve profitability in the current economic climate is commendable. However, to sustain long-term growth, FSI will need to successfully capitalize on the new opportunities mentioned and continue innovating in its core markets.

A CONFERENCE CALL IS SCHEDULED FOR THURSDAY, AUGUST 15, 2024, 11:00AM EASTERN TIME

SEE DIAL IN NUMBER BELOW

VICTORIA, BRITISH COLUMBIA, Aug. 14, 2024 (GLOBE NEWSWIRE) -- FLEXIBLE SOLUTIONS INTERNATIONAL, INC. (NYSE Amex: 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. Today the Company announces financial results for second quarter ended June 30, 2024.

Mr. Daniel B. O’Brien, CEO, states, “The second quarter results are a solid improvement over the year earlier period. We will try to build on these results over the remainder of the year.” Mr. O’Brien continues, “We also hope that the hard work the entire team has put into the Food/Nutrition division will start to pay off with new revenue as early as the current quarter.”

• Sales for the second quarter(Q2) were $10,528,739 up approximately 2% when compared to sales of $10,331,291 in the corresponding period a year ago.
• Q2, 2024 net income was $1,289,796 or $0.10 per share, compared to a net income of $809,865, or $0.07 per share, in Q2, 2023.
• Basic weighted average shares used in computing earnings per share amounts were 12,450,532 and 12,435,532 for Q2, 2024 and Q2, 2023 respectively.
• Q2, 2024 - Non-GAAP operating cash flow: The Company shows 6 months operating cash flow of $3,853,907, or $0.31 per share. This compares with operating cash flow of $3,220,674, or $0.26 per share, in the corresponding 6 months of 2023 (see the table and notes that follow for details of these calculations).

The NanoChem division and ENP subsidiary continue to be the dominant sources of revenue and cash flow for the Company. New opportunities continue to unfold in detergent, food, nutraceuticals, oil field extraction, turf, ornamental and agricultural use to further increase sales in these divisions.

CONFERENCE CALL

A conference call has been scheduled for 11:00 am Eastern Time, 8:00 am Pacific Time, on Thursday August 15th, 2024. CEO, Dan O’Brien will be presenting and answering questions on the conference call. To participate in this call please dial 1-800-245-3047 (or 1-203-518-9765) just prior to the scheduled call time. To join the call participants will be requested to give their name and company affiliation. The conference ID: SOLUTIONS and/or call title Flexible Solutions International – Second Quarter, 2024 Financials may be requested

The above information and following table contain supplemental information regarding income and cash flow from operations for the period ended June 30, 2024. Adjustments to exclude depreciation, stock option expenses and one time charges are given. This financial information is a Non-GAAP financial measure as defined by SEC regulation G. The GAAP financial measure most directly comparable is net income.

The reconciliation of each Non-GAAP financial measure is as follows:

FLEXIBLE SOLUTIONS INTERNATIONAL, INC.
CONSOLIDATED STATEMENT OF OPERATIONS
FOR THREE MONTHS ENDED JUNE 30, 2024 AND 2023
(SIX MONTHS OPERATING CASH FLOW - UNAUDITED)

		3 months Net Income Ended June 30
		2024				2023
Revenue		$	10,528,739			$	10,331,291
Income (loss) before income tax – GAAP		$	1,990,684			$	1,349,099
Provision for Income tax – net - GAAP		$	(558,251	)		$	(354,372	)
Net income (loss) Controlling interest - GAAP		$	1,289,796			$	809,865
Net income (loss) per common share – basic. – GAAP		$	0.10			$	0.07
3 month weighted average shares used in computing per share amounts – basic.- GAAP			12,450,532				12,435,532
			6 month Operating Cash Flow Ended June 30
Operating Cash Flow (6 months). NON-GAAP		$	3,853,907	a,b,c		$	3,220,674	a,b,c
Operating Cash Flow per share excluding non-operating items and items not related to current operations (6 months) – basic. -NON-GAAP		$	0.31	a,b,c		$	0.26	a,b,c
Non-cash Adjustments (6 month) -GAAP		$	1,318,784	d		$	1,118,100	d
Shares (6 month basic weighted average) used in computing per share amounts – basic -GAAP			12,450,118				12,434,230

Notes: certain items not related to “operations” of the Company’s net income are listed below.

a) Non-GAAP – Flexible Solutions International purchased 65% of ENP in 4^th quarter, 2018 (October 2018). Therefore Operating Cash Flow is adjusted by the pre tax Net income or loss of the non-controlling interest in ENP for 2023 only. The 2024 entry in the “Statement of operations and comprehensive income” is a pretax number therefore no adjustment is required.
b) Non-GAAP – amounts exclude certain cash and non-cash items: Depreciation and Stock compensation expense (2024 = $1,318,784, 2023 = $1,118,100), Interest expense (2024 = $332,397, 2023 = $250,368), Interest income (2024 = $109,637, 2023 = $53,185), Gain on investment (2024 = $298,438, 2023 = $326,703), Loss on lease termination (2024 = $41,350, 2023 = N/A), Income tax (2024 = ($822,429), 2023 = ($654,149)), and pretax Net income attributable to non-controlling interests (2024 = $201,620, 2023 = $381,276). Although included in operating expenses these onetime expenditures were not related to operations of FSI. *See the financial statements for all adjustments.
c) The revenue and gain from the 50% investment in the private Florida LLC announced in January 2019 are not treated as revenue or profit from operations by Flexible Solutions given the Company only purchased 50% of the LLC. The profit is treated as investment income and therefore occurs below Operating income in the Statement of Operations. As a result, the Gains on all investments, including those from the Florida LLC, are removed from the calculation to arrive at Operating Cash Flow. Again, see the financials.
d) Non-GAAP – amounts represent depreciation and stock compensation expense.

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
E-mail: info@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

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

FAQ

What were FSI's Q2 2024 financial results?

FSI reported Q2 2024 sales of $10,528,739, up 2% year-over-year, and net income of $1,289,796 ($0.10 per share), compared to $809,865 ($0.07 per share) in Q2 2023.

How did FSI's operating cash flow perform in the first half of 2024?

FSI's 6-month operating cash flow for 2024 was $3,853,907 ($0.31 per share), an improvement from $3,220,674 ($0.26 per share) in the same period of 2023.

Which divisions are the main revenue drivers for FSI?

The NanoChem division and ENP subsidiary continue to be the dominant sources of revenue and cash flow for FSI.

What new opportunities is FSI exploring to increase sales?

FSI is exploring new opportunities in detergent, food, nutraceuticals, oil field extraction, turf, ornamental, and agricultural sectors to further increase sales in its divisions.