Greg Hillman

Greg Hillman, an investor, asked about the Water Saver product, specifically clarifying if its evaporation savings had improved to 40% from a previously stated 20%. He also inquired about alternative substances to food-grade aspartic acid for similar functions and the amount of time spent on a recently called-off deal. Additionally, he asked about the company's pipeline for future deals and if they work with an investment banker.

Answer

Daniel O'Brien, President, CEO, CFO, CAO, and a Director, clarified that 40% is the maximum possible evaporation control for Water Saver on day one under good conditions, with averages closer to 20%, and highlighted the difficulty in selling it due to its invisible nature and bureaucratic proof requirements. He explained that while alternatives exist for food-grade aspartic acid (like cellulose filtration or acrylic acid ionic columns), they are more expensive or not food-approved globally. O'Brien stated that the called-off deal was a five-month process, consuming a couple of hours daily, but did not reach full due diligence. He confirmed Flexible Solutions does not have an investment banker under contract and evaluates acquisition targets singularly, without a formal pipeline.

Greg Hillman followed up on Flexible Solutions International's EMP products for turf and golf courses, asking if any contained biologicals that affect soil bacteria and root growth, and if so, how much deeper roots grow. He also asked if these products are used on professional football fields.

Answer

President and CEO Daniel O'Brien stated he couldn't provide root depth in centimeters but confirmed some EMP products contain biologicals and polyaspartates, which significantly affect root growth, with extensive data available. He directed to 'Foliarpack' for more information on root growth, durability, and greenness. O'Brien confirmed that EMP products are indeed used on college and professional football fields.

The analyst asked about the company's competitive expertise in TPA, the market awareness of its nitrogen conservation products, the branding strategy with distributors, and the valuation of certain investments on the balance sheet.

Answer

The company has unique, patent-protected expertise in food-grade TPA for wine. In other areas, it competes with Chinese firms, and the Panama move will enhance competitiveness. While all major crop farmers know about nitrogen conservation products, few use them, and they often know them by distributor brand names, not FSI's. The company sees no way to force distributors to use its trade names. Regarding balance sheet investments, one is performing well and will not be written down, while another is being monitored quarterly for potential write-down based on its cash burn.