# Flexible Solutions International Inc: Form 10-Q for the period ended Jun 30, 2025

- Company: [Flexible Solutions International Inc](/companies/fsi.md) (CIK 1069394)
- Form: 10-Q
- Filed: 2025-08-14
- Accepted by EDGAR: Aug 14, 2025, 20:01 ET
- Period: 2025-06-30
- Accession: 0001641172-25-023966
- Inline XBRL: yes
- Main document: https://www.sec.gov/Archives/edgar/data/1069394/000164117225023966/form10-q.htm
- All documents and exhibits: https://www.sec.gov/Archives/edgar/data/1069394/000164117225023966/

## Figures reported in this filing

Standardized XBRL line items for the period ended 2025-06-30.

| Line item | Period | Value | XBRL concept |
| --- | --- | ---: | --- |
| Revenue | 3 months, 2025-04-01 to 2025-06-30 | $11.4m | us-gaap:RevenueFromContractWithCustomerExcludingAssessedTax |
| Revenue | 6 months, 2025-01-01 to 2025-06-30 | $18.8m | us-gaap:RevenueFromContractWithCustomerExcludingAssessedTax |
| Cost of revenue | 3 months, 2025-04-01 to 2025-06-30 | $6.0m | us-gaap:CostOfGoodsAndServicesSold |
| Cost of revenue | 6 months, 2025-01-01 to 2025-06-30 | $11.5m | us-gaap:CostOfGoodsAndServicesSold |
| Gross profit | 3 months, 2025-04-01 to 2025-06-30 | $5.4m | us-gaap:GrossProfit |
| Gross profit | 6 months, 2025-01-01 to 2025-06-30 | $7.3m | us-gaap:GrossProfit |
| Research and development | 3 months, 2025-04-01 to 2025-06-30 | $167.2k | us-gaap:ResearchAndDevelopmentExpense |
| Research and development | 6 months, 2025-01-01 to 2025-06-30 | $274.0k | us-gaap:ResearchAndDevelopmentExpense |
| Operating income | 3 months, 2025-04-01 to 2025-06-30 | $3.3m | us-gaap:OperatingIncomeLoss |
| Operating income | 6 months, 2025-01-01 to 2025-06-30 | $3.2m | us-gaap:OperatingIncomeLoss |
| Income tax | 3 months, 2025-04-01 to 2025-06-30 | $1.0m | us-gaap:IncomeTaxExpenseBenefit |
| Income tax | 6 months, 2025-01-01 to 2025-06-30 | $1.1m | us-gaap:IncomeTaxExpenseBenefit |
| Net income | 3 months, 2025-04-01 to 2025-06-30 | $2.0m | us-gaap:NetIncomeLoss |
| Net income | 6 months, 2025-01-01 to 2025-06-30 | $1.8m | us-gaap:NetIncomeLoss |
| Diluted EPS | 3 months, 2025-04-01 to 2025-06-30 | $0.15 | us-gaap:EarningsPerShareDiluted |
| Diluted EPS | 6 months, 2025-01-01 to 2025-06-30 | $0.13 | us-gaap:EarningsPerShareDiluted |
| Basic EPS | 3 months, 2025-04-01 to 2025-06-30 | $0.16 | us-gaap:EarningsPerShareBasic |
| Basic EPS | 6 months, 2025-01-01 to 2025-06-30 | $0.14 | us-gaap:EarningsPerShareBasic |
| Diluted shares (weighted) | 3 months, 2025-04-01 to 2025-06-30 | 13,267,333 shares | us-gaap:WeightedAverageNumberOfDilutedSharesOutstanding |
| Diluted shares (weighted) | 6 months, 2025-01-01 to 2025-06-30 | 13,382,735 shares | us-gaap:WeightedAverageNumberOfDilutedSharesOutstanding |
| Operating cash flow | 6 months, 2025-01-01 to 2025-06-30 | $4.7m | us-gaap:NetCashProvidedByUsedInOperatingActivities |
| Capital expenditure | 6 months, 2025-01-01 to 2025-06-30 | $1.3m | us-gaap:PaymentsToAcquirePropertyPlantAndEquipment |
| Dividends paid | 6 months, 2025-01-01 to 2025-06-30 | $1.3m | us-gaap:PaymentsOfDividends |
| Cash and equivalents | at 2025-06-30 | $8.6m | us-gaap:CashAndCashEquivalentsAtCarryingValue |
| Current assets | at 2025-06-30 | $31.1m | us-gaap:AssetsCurrent |
| Total assets | at 2025-06-30 | $58.2m | us-gaap:Assets |
| Current liabilities | at 2025-06-30 | $9.2m | us-gaap:LiabilitiesCurrent |
| Total liabilities | at 2025-06-30 | $15.7m | us-gaap:Liabilities |
| Long-term debt | at 2025-06-30 | $6.4m | us-gaap:LongTermDebtNoncurrent |
| Current portion of debt | at 2025-06-30 | $1.1m | us-gaap:LongTermDebtCurrent |
| Shareholders' equity | at 2025-06-30 | $39.4m | us-gaap:StockholdersEquity |

## Management's discussion and analysis

As filed, 7,765 characters.

### Overview

The Company manufactures and markets biodegradable polymers which are used in the oil, gas and agriculture industries. The Company also develops, manufactures and markets specialty chemicals that slow the evaporation of water.

### Results of Operations

We have three product lines.

The first is a chemical used in swimming pools and spas. The product forms a thin, transparent layer on the water’s surface. The transparent layer slows the evaporation of water, allowing the water to retain a higher temperature for a longer period of time thereby reducing the energy required to maintain the desired temperature of the water. A modified version can also be used in reservoirs, potable water storage tanks, livestock watering pods, canals, and irrigation ditches for the purpose of reducing evaporation. These products are sold by our EWCP division.

The second product, biodegradable polymers (“TPAs”), is used by the petroleum, chemical, utility and mining industries to prevent corrosion and scaling in water piping. TPAs can also be used to increase biodegradability in detergents and in the agriculture industry to increase crop yields by enhancing fertilizer uptake. TPA’s are sold by our BCPA division.

The third product line is nitrogen conservation products used for the agriculture industry. These products decrease the loss of nitrogen fertilizer after initial application and allow less fertilizer to be used. These products are made and sold by the Company’s BCPA division.

From time to time, the BCPA division also engages in performing research and development services for third parties.

Material changes in the Company’s Statement of Operations for six and three months ended June 30, 2025 compared to the same period in the prior year are discussed below:

#### Three Months ended June 30, 2025

|  |  |  |
| --- | --- | --- |
| Item | Increase (I) or Decrease (D) | Reason |
| Sales |  |  |
| EWCP products | D | Decreased customer orders. |
| BCPA products | D | Decreased customer orders. |
| Research and development services | I | Due to a successful project that completed in 2025. |
| Gross profit as a percentage of sales | I | Increase in research and development sales. |
| Consulting | D | Decreased reliance on consultants. |
| Professional fees | I | Increase in accounting fees related to tax filings and increase in audit fees related to growth of the Company. |
| Research | I | New product development. |
| Travel | D | Travel requirements were lower in for the first six months in 2025 than it was in 2024. |
| Gain on investment | D | Sale of 30.1% of profitable Florida based LLC in 2024 reduced the amount of our proportionate share of earnings. |
| Interest expense | I | Increased debt resulted in increased interest expense. |
| Interest income | D | Decrease in term deposits held. |

19

#### Six Months ended June 30, 2025

|  |  |  |
| --- | --- | --- |
| Item | Increase (I) or Decrease (D) | Reason |
| Sales |  |  |
| EWCP products | D | Decreased customer orders. |
| BCPA products | D | Decreased customer orders. |
| Research and development services | I | Due to a successful project that completed in 2025. |
| Gross profit as a percentage of sales | I | Increase in research and development sales. |
| Consulting | D | Decreased reliance on consultants. |
| Professional fees | I | Increase in accounting fees related to tax filings and increase in audit fees related to growth of the Company. |
| Research | I | New product development. |
| Travel | D | Travel requirements were lower in for the first six months in 2025 than it was in 2024. |
| Utilities | I | Addition of real estate not yet leased. |
| Gain on investment | D | Sale of 30.1% of profitable Florida based LLC in 2024 reduced the amount of our proportionate share of earnings. |
| Lease termination fee | D | One time cost incurred in March 2024 upon terminating lease in Naperville, IL. |
| Interest expense | I | Increased debt resulted in increased interest expense. |
| Interest income | D | Decrease in term deposit held. |

20

Three customers accounted for 45% of our product sales during the three months ended June 30, 2025 (2024 –52%) and 47% of our product sales during the six months ended June 30, 2025 (2024 – 50%). The amount of revenue (all from the sale of TPA products) attributable to each customer is shown below.

| Customer | Three months ended June 30, 2025 |  | 2024 |  | Six months ended June 30, 2025 |  | 2024 |  |
| --- | ---: | --- | ---: | --- | ---: | --- | ---: | --- |
| Company A | $1,094,243 |  | $1,134,720 |  | $1,924,726 |  | $2,426,145 | \* |
| Company B | $2,072,180 |  | $2,512,681 |  | $3,928,575 |  | $4,812,619 |  |
| Company C | $840,736 |  | $941,326 | \* | $1,819,093 |  | $2,456,867 |  |
| Company D | $592,000 | \* | $1,872,960 |  | $592,000 | \* | $2,574,076 |  |
| Company E | $2,500,000 | \*\* | $- | \*\* | $2,500,000 | \*\* | $- | \*\* |

\*not a primary product sales customer in that period

\*\*Research and development services sales are not included in product sales

Customers with balances greater than 10% of our receivables as of June 30, 2025 and 2024 are shown below:

|  | June 30, 2025 |  | 2024 |
| --- | ---: | --- | ---: |
| Company B | $1,978,433 |  | $1,390,812 |
| Company E | $2,500,000 |  | $- |
| Company F | $522,982 | \* | $974,992 |
| \*less than 10% |  |  |  |

Other factors that will most significantly affect future operating results will be:

- the sale price of crude oil which is used in the manufacture of aspartic acid we import from China. Aspartic acid is a key ingredient in our TPA products;
- activity in the oil and gas industry, as we sell our TPA products to oil and gas companies;
- drought conditions, since we also sell our TPA products to farmers; and
- new tariffs relating to raw materials imported from China.

Other than the foregoing we do not know of any trends, events or uncertainties that have had, or are reasonably expected to have, a material impact on our revenues or expenses.

### Capital Resources and Liquidity

The Company’s sources and (uses) of cash for the six months ended June 30, 2025 and 2024 are shown below:

|  | 2025 | 2024 |
| --- | ---: | ---: |
| Cash provided by operating activities | 4,738,637 | 5,309,855 |
| Distributions received from equity investments | - | 427,000 |
| Purchase of property and equipment | (1,331,042) | (1,663,697) |
| Repayment of short term line of credit, net | (1,342,067) | (1,190,635) |
| Repayment of long term debt | (1,234,489) | (373,615) |
| Proceeds from long term debt | - | 524,812 |
| Dividends paid | (1,274,753) | (1,255,053) |
| Distributions to non-controlling interest | (252,169) | (365,644) |
| Proceeds from shares issued upon exercise of stock options | 393,890 | 26,250 |
| Effects of exchange rate changes on cash | 269,354 | 62,341 |

The Company has sufficient cash resources to meets its future commitments and cash flow requirements for the coming year. As of June 30, 2025, working capital was $21,940,799 (December 31, 2024 - $22,714,190) and the Company has no substantial commitments that require significant outlays of cash over the coming fiscal year.

Other than as disclosed above, the Company does not anticipate any significant capital requirements for the twelve months ending June 30, 2026.

Other than as disclosed above, the Company does not know of any trends, demands, commitments, events or uncertainties that will result in, or that are reasonable likely to result in, its liquidity increasing or decreasing in any material way.

There have been no significant changes to the critical accounting estimates disclosed in Management’s Discussion and Analysis of Financial Condition and Results of Operations in our 2024 Form 10-K.

## Controls and procedures

As filed, 1,689 characters.

Evaluation of Disclosure Controls and Procedures

Under the direction and with the participation of our management, including our Principal Executive and Financial Officer, we conducted an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures as of June 30, 2025. We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our periodic reports with the Securities and Exchange Commission is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and regulations, and that such information is accumulated and communicated to our management, including our principal executive and financial officer, as appropriate, to allow timely decisions regarding required disclosure. Our disclosure controls and procedures are designed to provide a reasonable level of assurance of reaching desired disclosure control objectives. Based on the evaluation, our Principal Executive and Financial Officer concluded that these disclosure controls and procedures are effective as of June 30, 2025

Changes in Internal Control over Financial Reporting

Our management, with the participation of our Principal Executive and Financial Officer, evaluated whether any change in our internal control over financial reporting occurred during the three months ended June 30, 2025. Based on that evaluation, it was concluded that there has been no change in our internal control over financial reporting during the three months ended June 30, 2025 that materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Filed Aug 14, 2025.
Source: SEC EDGAR, the filing index for accession 0001641172-25-023966. Last ingested by Listed: Oct 24, 2026, 15:03 ET. No prices; not investment advice.