Flexible Solutions International (FSI) investor relations material

Executive summary

• Q2 2026 revenue was $7.60 million, down 14% from $8.87 million in Q2 2025, mainly due to non-recurring R&D revenue in the prior year.

• Net loss of $1.91 million ($0.15 per share) in Q2 2026, attributed to scale-up costs for new food-grade contracts and Panama facility expansion.

• Revenue for the six months ended June 30, 2026 was $15.9 million, down from $18.8 million year-over-year.

• Three primary customers accounted for 54% of Q2 2026 sales.

• Major settlement resulted in surrender of a 19.9% equity interest in a Florida-based LLC for perpetual, exclusive, royalty-free license rights.

Financial highlights

• Q2 2026 sales: $7.60 million, down from $8.87 million in Q2 2025; six-month sales: $15.9 million, down from $18.8 million.

• Net loss: $1.91 million in Q2 2026 vs. net income of $2.03 million in Q2 2025.

• Gross profit for the six months was $1.60 million, down from $7.34 million year-over-year.

• Cash provided by operating activities was $3.5 million for the six months, down from $4.7 million prior year.

• Working capital at June 30, 2026 was $18.7 million, down from $24.2 million at year-end 2025.

Outlook and guidance

• Significant revenue growth expected in Q3 and Q4 as new food contracts reach full production and Panama division rebounds.

• Management expects Panama division to contribute $3 million, ENP over $5 million, and NanoChem over $4 million in Q3 2026.

• Margin impact from Panama facility startup and new food-grade ramp-up expected to taper off in Q3 2026.

• No significant capital requirements anticipated beyond cash on hand for the next twelve months.

• Inventory build-up positions company to manage raw material price volatility and support growth.