This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

FSI Announces Second Quarter, 2012 Financial Results

FLEXIBLE SOLUTIONS INTERNATIONAL, INC. (NYSE MKT: 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 second quarter (Q2) ended June 30, 2012.

Mr. Daniel B. O’Brien, CEO, states, “Our non-GAAP operating cash flow demonstrates the Company’s financial strength. With regard to revenue forecasting, given the continuing economic slow-down in Europe and the Far East, it is simply too difficult and unrealistic to give accurate revenue guidance at this time. Full year 2012 revenue is still expected to be higher than 2011.” Mr. O’Brien continues, “As a result of the seasonality of the agriculture and swimming pool markets, FSI’s sales tend to be larger during the first half of the year, causing higher accounts receivable, and lower cash and inventory numbers. This does not affect the Company’s ability to grow given its strong working capital position including, a largely untapped $6.4million line of credit with a Chicago based bank.”

Note : as a result of the start up of the Alberta factory, a biomass expense is no longer given in the news release. Also, due to the generation of revenue from that facility, depreciation of the factory has begun resulting in a significantly higher non-cash accounting expenses in the financials. Further, this added expense does not significantly reduce taxes paid since the expense originates in Canada and, at this time, most of the revenue generated by Flexible Solutions International is U.S. based. The current Illinois/Federal Corporate tax rate is close to 40%.

  • Sales in the second quarter (Q2) were $3,761,729, down approximately 4% when compared to sales of $3,930,075 in the corresponding period a year ago. The financials give a Q2, 2012 accounting net loss of $465,995, or $0.04 per share compared to an accounting net profit of $174,734, or $0.01 per share in Q2, 2011. Although the income tax expense taken in Q2, 2012 was only $120,000 compared to $295,000 in Q2, 2011, the depreciation expense increased from $82,193 in 2011 to $305,189 in 2012. The increase in depreciation was largely Canada based and not deductible from US income.
  • Basic weighted average shares used in computing per share amounts in Q2 were 13,169,991 for 2012 and 13,169,991 for 2011. Note: a share buy back by the Company of close to 800,000 shares in Q1, 2011 is the reason for the reduced share count in first half.
  • Non-GAAP operating cash flow: For the 6 months ending June 30, 2012, net income reflects $676,426 of non-cash charges (depreciation and stock option expenses), as well as net income tax ($680,000), interest expense ($61,414) and other minor items ($2,578) not related to operating or current operating activities. When these items are removed the Company shows operating cash flow of $1,171,923, or $0.09 per share. This compares with operating cash flow of $1,423,196, or $0.11 per share, in the corresponding 6 months of 2011 (see the table that follows for details of these calculations).

Mr. O’Brien states, “We are satisfied with our first half revenue increase considering the stress Europe is enduring and slowdowns in the US and China. Q3 this year is likely to be similar to Q2 in growth terms, however, as agricultural preorders begin in late fall, we hope to see a resumption of top line growth for Q4.”

1 of 3

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,031.14 +43.63 0.26%
S&P 500 1,984.13 -1.41 -0.07%
NASDAQ 4,518.9020 -48.6960 -1.07%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs