Earnings Labs

Flexible Solutions International, Inc. (FSI)

Q3 2017 Earnings Call· Wed, Nov 15, 2017

$6.53

+0.31%

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Transcript

Operator

Operator

Good day, and welcome to the Flexible Solutions International Third Quarter 2017 Financial Results Conference Call. Today's conference is being recorded. At this time, I would like to turn the conference over to Mr. Dan O’Brien. Please go ahead, sir. Daniel O’Brien: Thank you, David. Good morning. This is Dan, CEO of Flexible Solutions. The 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 statements 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. Welcome to the third quarter conference call for 2017. Before focusing on the financials, I'd like to talk about our recovery from the fire, our product lines and what we think may occur over the next several quarters. The fire at Taber was unfortunate. However, we've received a total of CAD 5.7 million from our insurance and may receive additional funds in Q4 after all the details of the equipment we lost have been reviewed by our insurer. The Heatsavr liquid pool cover is back in production to serve our worldwide customer base. The property is ready for construction, but because the bids to rebuild were unreasonably high, we bought an existing building. The new building, just blocks from the old one, now houses our Heatsavr manufacturing and our accounting activities. The property where the fire took place will be sold when a reasonable offer is received. The NanoChem division, NCS, represents most of the revenue of FSI. This division makes thermal…

Operator

Operator

[Operator Instructions] Mr. O’Brien, at this time, we have no questioners in the queue. Daniel O’Brien: David, thank you very much. Could you...

Operator

Operator

We have one now, sir. We have one in the queue, if you would like to take it. It's from [ Raymond Howe with CFE ] Incorporated.

Unknown Analyst

Analyst

Could you talk a little bit about the commercial potential of the WaterSavr product? Daniel O’Brien: Well, certainly. As you heard in the speech portion, it's capable of saving water at about 1/5 of the cost that people in California are paying for water at a commercial level. The individual households would pay almost double that. So 10x less than a retail price. And it's also about 10x less than the cost to get new water from saltwater using desal processes. The difficulty in -- I mean, that was well illustrated in the speech, is that bureaucracies are really not very good at deciding to use new products and new ideas and even after a decade of proving us in many countries around the world, we still have trouble getting people to do -- essentially do their jobs. And it's quite frustrating. In terms of the size of the market, the one I mentioned, the Salton Sea in California would be in the range of $35 million per year contract. And we would probably recognize before-tax profits in the range of 35% to 40%. So this is something we're staying with, but I certainly don't want anyone thinking that we're going to succeed tomorrow.

Operator

Operator

Mr. O'Brien, at this time, no other questions. Daniel O’Brien: Well, thank you very much, David. Perhaps you can close off the meeting for us. Thanks.

Operator

Operator

Yes, sir. Ladies and gentlemen, that concludes today's presentation. You may disconnect your phone lines. And thank you for joining us for this morning's presentation.