Attached files
EXHIBIT 99.1
News Release November 14, 2011
FSI ANNOUNCES THIRD QUARTER FINANCIAL RESULTS
Conference call scheduled for Tuesday Nov., 15, 2011 11:00 a.m.
Eastern time, 8:00 a.m. Pacific Time
See dial in number below
VICTORIA, BRITISH COLUMBIA, Nov 14, 2011 - FLEXIBLE SOLUTIONS INTERNATIONAL,
INC. (NYSE AMEX: FSI, FRANKFURT: FXT), is the developer and manufacturer of
biodegradable polymers for oil extraction, detergent ingredients, water
treatment and crop nutrient availability chemistry, as well as biodegradable and
environmentally safe water and energy conservation technologies. Today the
Company announces financial results for the Third quarter (Q3) ended Sept. 30,
2011.
Mr. Daniel B. O'Brien, CEO, states, "Revenue growth continues to be very strong.
We are pleased with our financial progress given the strength of the non-GAAP
operating cash flow and GAAP operating income numbers given below and in the
following table. Flexible Solutions would have posted a positive net income from
operations for the quarter if not for the income tax expense and the expensing
of the sugar to aspartic acid factory construction in Alberta, Canada." Mr.
O'Brien continues, "We will continue to execute our long-term strategy of
reducing cost of raw materials by manufacturing them in house."
o Sales in the third quarter (Q3), were $3,861,195, up 44% when compared
to sales of $2,676,921, in the corresponding period a year ago. The
result was a GAAP accounting net loss of $92,293, or $0.01 per basic
weighted average shares for Q3, 2011, compared with a net loss of
$155,415, or $0.01 per basic weighted average share, in Q3, 2010. A
combination of a much higher income tax expense recognized in Q3, 2011
($247,634) versus Q3, 2010 ($9,140), higher raw material cost from
China, as well as the mix of products sold were the main factors that
resulted in a negative net income in Q3.
o GAAP operating income for the third quarter of 2011 was positive
$155,288 compared to negative $146,275 for a net positive change of
$301,563. This illustrates the cost control exercised throughout
operations.
o Basic weighted average shares used in computing per share amounts in
Q3 were 13,169,991 for 2011 and 13,962,567 for 2010. A share buy back
of 792,576 shares in Q1, 2011 is the reason for the reduction of
shares outstanding.
o Non-GAAP operating cash flow: For the 9 months ending Sept. 30, 2011,
net income reflects $370,111 of non-cash charges (depreciation and
stock option expenses), net --- income tax expense of $862,634, and
new factory construction and development costs and related interest
expense of $650,969. These items are either non-cash items or items
not related to operations or current operating activities. When these
items are removed, the Company shows operating cash flow of
$2,324,209, or $0.18 per weighted average share. This compares with
operating cash flow of 1,737,521, or $0.12 per share, in the
corresponding 9 months of 2010 (see the table that follows for details
of these calculations).
Per the News Release of November 3rd, successful commercial production has begun
at the sugar to aspartic acid plant in Taber, Alberta. The Company will scale up
production in this facility over the coming months and the output will be
shipped to the Company's Illinois factory for conversion into thermal
polyaspartate (TPA).
Swimming pool product sales continue to grow as a result of customer focus on
reducing energy and water costs. Ecosavr and Heatsavr reduce energy costs by
reducing evaporation of warm swimming pool water.
The NanoChem division continues to contribute most of our sales and cash flow
and, new opportunities are unfolding to further increase sales in this division.
NanoChem sales have become less seasonal than those of our WaterSavr and
Flexible Solutions Ltd divisions. This has lead to less volatility in total
revenue figures quarter over quarter. However, in the future, first half sales
should be larger than second half. This is due to predicted growth in
agricultural product sales, sales which are stronger in the first half of each
year.
(TABLE FOLLOWS)
* CEO, Dan O'Brien has scheduled a conference call for 11:00am EST, 8:00am PST,
Tuesday Nov. 15th to discuss the financials. Call 1-480-629-9692 (or
1-877-941-9205), just prior to the scheduled call time. The conference call
title, "Third Quarter Financials," may be requested. *
The above information and following table contains supplemental information
regarding income and cash flow from operations for the 3 & 9 months respectively
ended Sept 30, 2011 and 2010. Adjustments to exclude depreciation, stock option
expenses, one time charges and certain other expenses 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 of the non-GAAP financial measures is as follows:
FLEXIBLE SOLUTIONS INTERNATIONAL, INC.
Consolidated Statement of Operations
For 3 Months Ended Sept. 30 (9 Months Operating Cash Flow)
(Unaudited)
-------------------------------------------------------------------------------
3 months ended Sept. 30
2011 2010
--------------------------------
Revenue $3,861,195 $2,676,921
Net income (loss) GAAP $ (92,293) $ (155,415)
Net income (loss) per common share - basic.
GAAP $ (0.01) $ (0.01)
3 month weighted average shares used in
computing per share amounts - basic. GAAP 13,169,991 13,962,567
9 month Operating Cash Flow
Ended Sept. 30
--------------------------------
Operating Cash flow (9 months). NON-GAAP $1,673,240 a $1,092,908 b
Operating Cash flow excluding non-operating $2,324,209 c $1,737,521 d
items and items not related to current
operations (9 months). NON-GAAP
Operating Cash flow per share excluding $ 0.18 c $ 0.12 d
non-operating items and items not related to
current operations (9 months) - basic.
NON-GAAP
Non-cash Adjustments (9 month) $ 370,111 e $ 375,022 f
9 month basic weighted average shares used in 13,269,926 13,962,567
computing per share amounts - basic GAAP
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Notes: certain items, including items not related to operations or current
operating activities of the Company, have been excluded from net income as
follows:
a NON-GAAP amount excludes certain non-cash items (depreciation and stock
option expenses - $370,111), as well as interest income($53), and income
taxes charged (of $882,634 - $20,000). This is a 9 month number as per
financials.
b NON-GAAP amount excludes certain non-cash items (depreciation and stock
option expenses - $375,022), interest income as well as income taxes charged
(of $491,220). This is a 9 month number as per financials.
c NON-GAAP amount excludes certain non-cash items (depreciation and stock
option expense - $370,111), as well as interest income($53) and certain items
not related to operations or current operating activities; new factory
construction and development costs and related interest expense ($650,969),
and income tax ($882,634 - $20,000).
d NON-GAAP amount excludes certain non-cash items (depreciation and stock
option expense - $375,022), as well as interest income and certain items not
related to operations or current operating activities; new factory
construction and development costs and related interest expense ($644,613),
and income tax expense (of $491,220).
e NON-GAAP amount represents depreciation and stock option expenses.
f NON-GAAP amount represents depreciation and stock option expenses.
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
615 Discovery Street, Victoria, BC V8T 5G4 CANADA
Contact Flexible Solutions International - Head Office
------- Jason Bloom
Tel: 250-477-9969
Tel: 800.661.3560
Email: 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: Laura@FlexibleSolutions.com To
find out more information about Flexible Solutions and our products, please
visit www.flexiblesolutions.com.
