Attached files
EXHIBIT 99.1
FLEXIBLE SOLUTIONS
NEWS RELEASE March 31, 2015
FLEXIBLE SOLUTIONS ANNOUNCES FULL YEAR, 2014 FINANCIAL RESULTS
Conference call is scheduled for April 01, 2015.
See the time and dial in number below.
VICTORIA, BRITISH COLUMBIA, March 31, 2015 - FLEXIBLE SOLUTIONS INTERNATIONAL,
INC. (NYSE Amex: FSI, FRANKFURT: FXT), 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 the
first quarter and full year ended December 31, 2014.
Mr. Dan O'Brien, CEO states, "In 2014 we directed our energy toward increasing
sales and an orderly close of our aspartic acid project in Alberta. In the
second half of the year, revenue growth resumed and the large increase in
operating cash flow for the full year shows the progress we have made in
streamlining operations. We believe we executed on our plan and intend to
proceed the same way in 2015. We were particularly pleased with the large
WaterSavr sale in Texas and we hope that sale was the first of many."
The Company recognized a $2.4million deferred income tax recovery in 2013 as a
result of closing down the Alberta based aspartic acid facility. The accounting
adjustment to the Statement of Operations resulted in a substantially higher net
income than what the Company actually earned in that year. One should consider
this large adjustment to the financial statements when comparing net income to
latter or previous years. See details below.
o Sales for the full year 2014 were $15,907,849, up 1%, when compared to
$15,801,596 for full year 2013. The result was an after tax GAAP
accounting net income of $403,345, or $0.03 per weighted average
share, compared to an accounting net income of $1,821,634, or $0.14
per weighted average share in full year 2013(see the bullet points
below to explain the significantly large net income number in 2013).
o Non-GAAP operating cash flow: (for details see the following table).
For the 12 months ending Dec. 31, 2014, net income (loss) reflects
$716,290 of non-cash charges, Income Tax expense of $422,044, and when
these items, items not related to current operations of the Company,
are removed the Company shows positive operating cash flow of
$1,541,679 or $0.12 per share. This compares with 2013 operating cash
flow of $533,407, or $0.04 per share
o The financials show a significantly higher accounting net income in
2013 versus 2014. This is largely due to a deferred tax recovery of
$2,408,395 which was realized as an asset on the Balance Sheet in
2013. The Deferred Asset is the result of the commencement of the
expensing of the Alberta factory against the Company's US income. Past
and current factory construction and operating expenses not yet
applied against FSI's US income will now be carried forward to reduce
the NanoChem Division's revenue for income tax purposes.
The NanoChem division continues to be the dominant source of revenue and cash
flow for the Company. New opportunities continue to unfold in detergent, water
treatment, oil field extraction and agricultural use to further increase sales
in this division. In past years, the NanoChem division sales have been less
volatile quarter over quarter, however due to increasing sales to agriculture,
revenue seasonality may become larger. Also new sales opportunities have
appeared in the WaterSavr division as a result of the on going drought in the
southern United States. Many municipalities are water stressed and are seeking
ways to conserve water.
Conference call
** CEO, Dan O'Brien has scheduled a conference call for 11:00am EST, 8:00am PST,
Wednesday April 01, 2013 to discuss the financials. To attend this call, dial
888-455-2296 (or 719-325-2432). The conference call title, `Fourth Quarter 2014
Financials' maybe requested **
The above information and following table contain supplemental information
regarding income and cash flow from operations for the 3 & 12 months
respectively ended Dec. 31, 2014 and 2013. 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 of the Non-GAAP financial measures is as follows:
FLEXIBLE SOLUTIONS INTERNATIONAL, INC.
Consolidated Statement of Operations
For 3 & 12 Months Ended Dec. 31 (12 Months Operating Cash Flow)
(12 month audited / 3 month unaudited)
-------------------------------------------------------------------------------
3 and 12 month revenue
ended Dec. 31,
2014 2013
-----------------------------
3 month 3 month revenue
------- -----------------------------
Revenue NON-GAAP $ 3,957,623 $ 3,431,433
------------- ------------
12 month revenue
-----------------------------
12 month
Revenue GAAP $ 15,907,849 $ 15,801,596
Net income (loss) GAAP $ 403,345 a $ 1,821,634
Net income (loss) per share GAAP $ 0.03 a $ 0.14 a
12 month weighted average shares used in
computing per share amounts - basic GAAP 13,169,991 13,169,991
------------ ------------
The following calculations begin with: Net 12 month Operating Cash Flow
income (loss). GAAP ended Dec. 31,
-----------------------------
Operating cash flow (12 month). NON-GAAP -
Excludes: item "a" as indicated and as
listed in the Notes below. $ 1,541,679 b $ 533,407 c
Operating Cash flow per share (12 months) -
basic. NON-GAAP - Excludes: item "a" as
indicated and as listed in the Notes below. $ 0.12 b $ 0.04 c
Non-cash Adjustments (as per Consolidated
Statement of Cash Flow) $ 716,290 d $ (899,450)d
12 month basic weighted average shares used in
computing per share amounts - basic. GAAP $ 13,169,991 13,169,991
------------ -----------
Notes: certain items not related to "operations" of the Company have been
excluded as follows.
a) Significant information. Expensing of the Alberta factory against US income
began in 2013. This resulted in a much lower income tax expense as well as
a deferred tax recovery asset recognized on the balance sheet for 2013.
This created a significant difference in the net income (loss) posted in
2013 versus 2014.
b) NON-GAAP - amount excludes certain non-cash items: depreciation($789,733),
stock compensation expense($91,168), and deferred income tax recovery
($164,611), as well as interest income ($ N/A), gain on sale of equipment
($ N/A), income tax expense ($422,044). This is a 12 month number as per
the financials.
c) NON-GAAP - amount excludes certain non-cash items:
depreciation($1,298,616), stock compensation expense($129,155), and
deferred income tax recovery($2,408,395), and write down of
inventory($81,174), as well as interest income ($2,000) a gain on sale of
equipment ($2,057), income tax recovery ($134,720) and exclusive
distributor fee ($250,000). This is a 12 month number as per the
financials.
d) NON-GAAP amount represents: depreciation, stock based compensation, write
down of inventory and deferred income tax recovery per the Consolidated
Statement of Cash Flows.
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
206 - 920 Hillside Ave, Victoria, BC V8T 1Z8 CANADA
Company Contacts
Flexible Solutions International - Head Office
Jason Bloom
Tel: 250-477-9969
Tel: 800.661.3560
Email: Info@flexiblesolutions.com
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To find out more information about Flexible Solutions and our products, please
visit www.flexiblesolutions.co
