SOURCE: Flexible Solutions International, Inc.

May 15, 2007 16:15 ET

Flexible Solutions Announces First Quarter, 2007 Financial Results

Conference Call Scheduled for Wednesday, May 16th, 11:00am Eastern Time, 8:00am Pacific Time, See Dial-In Number Below

VICTORIA, BC -- (MARKET WIRE) -- May 15, 2007 -- Flexible Solutions International, Inc. (AMEX: FSI) (FRANKFURT: FXT), a developer and manufacturer of biodegradable and environmentally safe, water and energy conservation technology, as well as anti-scalant and crop nutrient enhancement products, today announces financial results for the first quarter (Q1) ended Mar. 31, 2007.

Mr. Daniel B. O'Brien, CEO, states, "This was another great quarter for FSI even though operating revenues showed a slight decline. The decrease in sales was due in large to shipping problems. A shortage of liquid cargo containers available for shipping our products in March reduced FSI's top line sales numbers for the quarter even though purchase orders were received. The Company does not book sales as revenue until product is shipped."

* Sales in the first quarter (Q1) were $2,289,901, down slightly when compared to sales of $2,508,445 in the corresponding period a year ago. The result was an accounting net loss of $24,215, or $0.00 per basic weighted average shares for Q1, 2007.

* Basic weighted average shares used in computing per share amounts for the quarters were 13,240,377 for 2007 and 12,981,316 for 2006.

* Non-GAAP operating cash flow: For the 3 months ended Mar. 31, 2007, net income reflects $251,445 of non-cash charges (depreciation and stock option expenses) and, when non-cash charges are removed, the Company shows positive operating cash flow of $227,230, or $0.02 per share. This compares with operating cash flow of $433,989, or $0.03 per share, in the corresponding 3 months of 2006 (the 2006 cash flow number excludes Income tax recovery as detailed in the following table).

The NanoChem division continues to contribute substantially to sales and cash flow, and significant new opportunities have developed to further increase sales in this division. Also, opportunities to synergistically cross sell the products of all FSI divisions continue to generate leads to new business. The swimming pool and NanoChem divisions are cooperating to increase utilization of the Peru, Illinois, factory while decreasing costs for the Company as a whole. Note that NanoChem sales are much less seasonal than those of our WaterSavr and Flexible Solutions Ltd divisions, which has led to less volatility in sales figures quarter over quarter.

* CEO Dan O'Brien has scheduled a conference call for 11:00am EDT, 8:00am PDT, Wednesday, May 16th, to discuss the financials. Call 866 249 6463 (or 303 262 2138). *

The above information and following table contain supplemental information regarding income from operations for the 3 months ended March 31, 2007 and 2006. Adjustments to exclude depreciation, stock option expenses and one-time charges are given give. 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 Cash Flow)
(Unaudited)

---------------------------------------------------------------------------
                                                                  Unaudited
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                                                Three months ended March 31
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                                                    2007               2006
---------------------------------------------------------------------------
Revenue                                       $2,289,901         $2,508,445
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Net income (loss) GAAP                         $(24,215)           $209,329
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Net income (loss) per common share
-- basic. GAAP                                     $0.00              $0.02
---------------------------------------------------------------------------
Net income (loss) excluding
Income tax recovery                            $(24,215)            $82,250
NON-GAAP
---------------------------------------------------------------------------
Net income (loss) per common share
excluding "Other                                   $0.00              $0.01
item" -- basic. NON-GAAP
---------------------------------------------------------------------------
3 month weighted average shares
used in computing                             13,240,377         12,981,316
per share amounts -- basic. GAAP

                                          Operating Cash               Flow

Operating Cash flow (3 months). NON-GAAP     $227,230 a          $561,068 a
---------------------------------------------------------------------------
Operating Cash flow excluding
Income tax recovery                          $227,230 a          $433,989 a
(3 month) - NON-GAAP
---------------------------------------------------------------------------
Operating Cash flow per share
excluding Income tax                            $0.02 a             $0.03 a
recovery (3 months) -- basic. NON-GAAP
---------------------------------------------------------------------------
Income tax recovery                                              $127,079
---------------------------------------------------------------------------
Non-cash Adjustments (3 month)               $251,445 b          $351,739 b
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a) Non-GAAP amounts exclude certain non-cash items, depreciation and stock
option expenses. This is a 3 month number as per financials.
b) 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.

Contact Information

  • Investor Contact:

    BPC Financial
    John Baldissera
    Toll Free: 800.368.1217
    Email: Email Contact

    Flexible Solutions International - Head Office
    Jason Bloom
    Tel: 800.661.3560
    Email: Email Contact