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EXHIBIT 99.1
NEWS RELEASE May 15, 2018
FSI ANNOUNCES FIRST QUARTER, 2018 FINANCIAL RESULTS Conference call
scheduled for Wednesday May 16th, 11:00am Eastern time,
8:00am Pacific Time
See dial in number below
VICTORIA, BRITISH COLUMBIA, May 15, 2018 - 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 (Q1) ended March 31, 2018.
Mr. Daniel B. O'Brien, CEO, states, "First quarter results were reasonable but
we hope to do better in the future. Earnings were flat, even with the top line
miss, due to product mix and cost control." Mr. O'Brien continues, "Subsequent
to the end of the quarter, we received the final insurance payment from the
Taber fire. This improves our cash on hand by about $2.4 MM US. Details are in
note 5 of the financials."
o Sales in the first quarter (Q1) were $4,201,180, down approximately
10% when compared to sales of $4,663,708 in the corresponding period a
year ago. The financials show a Q1, 2018 net income of $703,664, or
$0.06 per share, compared to a net income of $3,252,667, or $0.28 per
share, in Q1, 2017. An insurance claim payout of $2,572,288 in Q1,
2017 is the reason for the large discrepancy in the year over year net
income. If one were to remove the insurance payout from net income the
year over year Q1 net incomes would be very similar.
o Basic weighted average shares used in computing per share amounts in
Q1 were 11,620,291 and 11,458,170 for both 2018 and 2017 respectively.
o Non-GAAP operating cash flow: For the 3 months ending March 31, 2018,
net income reflects $85,400 of non-cash charges (depreciation and
stock option expenses), Income tax, Deferred income tax, Net gain or
loss from insurance payout and/or write down of inventory, as well as
Interest income; which are items not related to operating or current
operating activities. When these items are removed, the Company shows
operating cash flow of $1,096,979, or $0.09 per share. This compares
with operating cash flow of $1,155,828, or $0.10 per share, in the
corresponding 3 months of 2017 (see the table that follows for details
of these calculations).
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.
* a conference call has been scheduled for 11:00 am Eastern Time, 8:00 am
Pacific Time, on Wednesday May 16, 2018. CEO, Dan O'Brien will be presenting and
answering questions on the conference call. To participate in this call please
dial 1-866-548-4713 (or 1-323-794-2093) just prior to the scheduled call time.
The conference call title, "First Quarter 2018 Financials," may be requested.
1
The above information and following table contain supplemental information
regarding income and cash flow from operations for the 3 months ended March 31,
2018. 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 Months Ended March 31 (3 Months Operating Cash Flow)
(Unaudited)
--------------------------------------------------------------------------------
3 months ended March 31
2018 2017
---------------------------------
Revenue $4,201,180 $ 4,663,708
Income (loss) before income tax - GAAP $1,005,560 $ 3,572,946
Provision for Income tax(net) - GAAP $ 301,896 $ 296,875
Net income (loss) - GAAP $ 703,664 $ 3,252,667
Net income (loss) per common share - basic. -
GAAP $ 0.06 a $ 0.28 a
3 month weighted average shares used in
computing per share amounts - basic.- GAAP 11,620,291 11,458,170
3 month Operating Cash Flow
Ended March 31
---------------------------------
Operating Cash flow (3months). NON-GAAP $1,095,979 b $1,155,828 b
Operating Cash flow per share excluding
non-operating items and items not related to
current operations (3 months) - basic. $ 0.09 a,b $ 0.10 a,b
NON-GAAP
Non-cash Adjustments (3 month) GAAP $ 85,400 $ 103,857 c
Shares (3 month basic weighted average) used
in computing per share amounts - basic GAAP 11,458,170 a 11,620,291 a
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Notes: certain items not related to "operations" of the Company have been
excluded from net income as follows.
a) Non-GAAP - as a result of the fire at the Taber, Alberta factory an insurance
payout of $2,572,288 (net of tax, site clean-up and certain other minor
expenses) was received. This resulted in a significant increase in Q1, 2017 net
income of $0.22 per share. The inclusion of the insurance payment in the
financials should be considered when making a year over year comparison of
Flexible Solutions financials. See the financials for details.
b) Non-GAAP - amounts exclude certain non-cash items: depreciation and stock
option expense totaling (2018 = $85,400, 2017 = $103,857), Deferred tax expense
(2018 = $N/A, 2017 = $23,404), Income tax, (2018 = $301,896, 2017 = $296,875,),
net gain/(loss) of building and equipment from the fire in Taber, Alberta (2018
= ($7,716) also see note 5 in the 2018 financials, 2017 = $2,572,288), Interest
income (2018 = $ 1,697, 2017 = $33), write down of inventory (2018 = $N/A, 2017
= $51,346). See the financial statements for all adjustments.
c) 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 54th Ave, Taber, Alberta, CANADA T1G 1X4
Jason Bloom
Toll Free: 800 661 3560
Fax: 250 477 9912
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
