FSI 10-Q Quarter ended Sept. 30, 2025

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 10-Q

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2025

OR

☐	TRANSITION REPORT PURSUANT TO 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ________ to ________

Commission File Number: 001-31540

FLEXIBLE SOLUTIONS INTERNATIONAL INC.

(Exact Name of registrant as Specified in Its Charter)

Alberta, Canada

Alberta		71-1630889
(State or other jurisdiction of		(Employer
incorporation or organization)		Identification No.)

6001 54 Ave.
Taber , Alberta , Canada		T1G 1X4
(Address of Principal Executive Offices)		(Zip Code)

Registrant’s telephone number: (403) 223-2995

N/A

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock		FSI		NYSE American

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐ No ☒

Indicate by check mark whether the registrant (1) has filed all reports to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐	Accelerated filer ☐
Non-accelerated filer ☒	Smaller reporting company ☒
Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act): ☐ Yes ☒ No

Class of Stock		No. Shares Outstanding		Date
Common		12,692,498		November 14, 2025

FORM 10-Q

Index

PART I.	FINANCIAL INFORMATION		3
Item 1.	Financial Statements.		3
	(a)	Unaudited Condensed Interim Consolidated Balance Sheets at September 30, 2025 and December 31, 2024.	3
	(b)	Unaudited Condensed Interim Consolidated Statements of Operations and Comprehensive Income (Loss) for the Three Months Ended September 30, 2025 and 2024.	4
	(c)	Unaudited Condensed Interim Consolidated Statements of Operations and Comprehensive Income for the Nine Months Ended September 30, 2025 and 2024.	5
	(d)	Unaudited Condensed Interim Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2025 and 2024.	6
	(e)	Unaudited Condensed Interim Consolidated Statements of Stockholders’ Equity for the Three and Nine Months Ended September 30, 2025 and 2024.	7
	(f)	Notes to Unaudited Condensed Interim Consolidated Financial Statements for the Period Ended September 30, 2025.	9
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operation.		20
Item 4.	Controls and Procedures.		23
PART II.	OTHER INFORMATION		24
Item 5.	Other Information.		24
Item 6.	Exhibits.		24
SIGNATURES			25

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This document contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact are “forward-looking statements” for the purposes of the federal and state securities laws, including, but not limited to: any projections of earnings, revenue or other financial items; any statements of the plans, strategies and objectives of management for future operations; any statements concerning proposed new services or developments; any statements regarding future economic conditions or performance; any statements of belief; and any statements of assumptions underlying any of the foregoing.

Forward-looking statements may include the words “may,” “could,” “will,” “estimate,” “intend,” “continue,” “believe,” “expect” or “anticipate” or other similar words. These forward-looking statements present our estimates and assumptions only as of the date of this report. Except for our ongoing obligation to disclose material information as required by the federal securities laws, we do not intend, and undertake no obligation, to update any forward-looking statement.

Although we believe that the expectations reflected in any of our forward-looking statements are reasonable, actual results could differ materially from those projected or assumed in any of our forward-looking statements. Our future financial condition and results of operations, as well as any forward-looking statements, are subject to change and inherent risks and uncertainties. The factors impacting these risks and uncertainties include but are not limited to:

	●	Increased competitive pressures from existing competitors and new entrants;
	●	Increases in interest rates or our cost of borrowing or a default under any material debt agreement;
	●	Deterioration in general or regional economic conditions;
	●	Adverse state or federal legislation or regulation that increases the costs of compliance, or adverse findings by a regulator with respect to existing operations;
	●	Loss of customers or sales weakness;
	●	Inability to achieve future sales levels or other operating results;
	●	The unavailability of funds for capital expenditures;
	●	Operational inefficiencies in distribution or other systems; and
	●	New tariffs relating to raw materials imported from China.

For a detailed description of these and other factors that could cause actual results to differ materially from those expressed in any forward-looking statement, please see “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2024.

PART I FINANCIAL INFORMATION

Item 1. Financial Statements.

FLEXIBLE SOLUTIONS INTERNATIONAL, INC.

CONDENSED INTERIM CONSOLIDATED BALANCE SHEETS

(U.S. Dollars - Unaudited)

		September 30, 2025				December 31, 2024
Assets
Current
Cash		$	8,481,652			$	7,631,055
Term deposits (Note 2)			1,386,150				2,400,916
Accounts receivable, net (Note 3)			9,471,701				11,696,098
Inventories (Note 4)			9,486,798				10,890,195
Prepaid expenses and deposits			1,287,435				1,957,593
Building and land held for sale, net (Notes 5 and 13)			2,759,174				-
Total current assets			32,872,910				34,575,857
Property and equipment, net (Note 5)			16,372,163				17,146,184
Intangible assets			2,000,000				2,120,000
Long term deposits			1,594,578				167,882
Investments (Note 6)			2,978,860				3,424,381
Goodwill			2,534,275				2,534,275
Total Assets		$	58,352,786			$	59,968,579
Liabilities
Current
Accounts payable		$	2,133,316			$	2,049,425
Accrued liabilities			292,463				403,157
Deferred revenue			74,026				78,655
Income taxes payable			5,102,488				5,137,290
Short term lines of credit (Note 7)			557,113				2,052,159
Current portion of long term debt (Note 8)			2,932,752				2,140,981
Total current liabilities			11,092,158				11,861,667
Deferred income tax liability (Note 2)			122,019				122,019
Long term debt (Note 8)			4,146,792				6,618,867
Total Liabilities			15,360,969				18,602,553
Commitments and Contingencies (Notes 7 and 8)			-				-
Stockholders’ Equity
Capital stock (Note 10)
Authorized: 50,000,000 common shares with a par value of $ 0.001 each; 1,000,000 preferred shares with a par value of $ 0.01 each Issued and outstanding:
12,690,498 (December 31, 2024: 12,515,532 ) common shares			12,690				12,516
Authorized: 50,000,000 common shares with a par value of $0.001 each; 1,000,000 preferred shares with a par value of $0.01 each Issued and outstanding: 12,690,498 (December 31, 2024: 12,515,532) common shares			12,690				12,516
Capital in excess of par value			19,550,530				18,789,915
Accumulated other comprehensive loss			( 405,477	)			( 606,986	)
Accumulated earnings			19,809,594				19,836,527
Total stockholders’ equity – controlling interest			38,967,337				38,031,972
Non-controlling interests (Note 11)			4,024,480				3,334,054
Total Stockholders’ Equity			42,991,817				41,366,026
Total Liabilities and Stockholders’ Equity		$	58,352,786			$	59,968,579

— See Notes to Unaudited Condensed Interim Consolidated Financial Statements —

FLEXIBLE SOLUTIONS INTERNATIONAL, INC.

CONDENSED INTERIM CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

(U.S. Dollars — Unaudited)

		2025				2024
		Three Months Ended September 30,
		2025				2024
Sales
Products		$	10,556,291			$	9,314,937
Research and development services (Note 2)			-				-
Total Sales			10,556,291				9,314,937
Cost of sales			8,032,516				5,508,121
Gross profit			2,523,775				3,806,816
Operating Expenses
Advertising and promotion			73,358				52,872
Commissions			1,339				12,086
Consulting			47,893				82,261
Currency exchange			( 37,342	)			32,633
Insurance			256,358				280,846
Investor relations and transfer agent fee			64,683				39,988
Lease expense and rent			34,583				13,820
Office and miscellaneous			349,736				267,484
Professional fees			120,316				78,703
Research and development			255,657				27,806
Shipping			6,165				5,186
Telecommunications			18,026				16,287
Travel			50,290				64,874
Utilities			60,692				33,080
Wages, administrative salaries and benefits			910,718				884,940
Total operating expenses			2,212,472				1,892,866
Operating income			311,303				1,913,950
Non-operating income (expense)
Gain (loss) on investment			( 31,181	)			32,312
Loss on sale of investment			-				( 385,123	)
Loss on lease termination			-				-
Interest expense			( 136,465	)			( 132,741	)
Interest income			61,292				31,565
Total non-operating income (expenses)			( 106,354	)			( 453,987	)
Income before income tax			204,949				1,459,963
Income taxes
Income tax benefit (expense)			181,739				( 367,615	)
Net income			386,688				1,092,348
Net income attributable to non-controlling interests			( 890,046	)			( 480,490	)
Net income (loss) attributable to Flexible Solutions International Inc.		$	( 503,358	)		$	611,858
Net income (loss) per share (basic and diluted)		$	( 0.04	)		$	0.05
Weighted average number of common shares (basic)			12,660,923				12,450,532
Weighted average number of common shares (diluted)			12,660,923				12,701,812
Other comprehensive income (loss):
Net income		$	386,688			$	1,092,348
Unrealized gain (loss) on foreign currency translations			( 67,845	)			37,935
Total comprehensive income		$	318,843			$	1,130,283
Comprehensive income – non-controlling interest			( 890,046	)			( 480,490	)
Comprehensive income(loss) attributable to Flexible Solutions International Inc.		$	( 571,203	)		$	649,793

— See Notes to Unaudited Condensed Interim Consolidated Financial Statements —

FLEXIBLE SOLUTIONS INTERNATIONAL, INC.

CONDENSED INTERIM CONSOLIDATED STATEMENTS OF OPERATIONS AND

COMPREHENSIVE INCOME

(U.S. Dollars — Unaudited)

		2025				2024
		Nine Months Ended September 30,
		2025				2024
Sales
Products		$	26,897,115			$	29,068,548
Research and development services (Note 2)			2,500,000				-
Total Sales			29,397,115				29,068,548
Cost of sales			19,536,510				18,502,270
Gross profit			9,860,605				10,566,278
Operating Expenses
Advertising and promotion			240,035				183,104
Commissions			21,300				12,086
Consulting			189,970				324,577
Currency exchange			( 2,941	)			78,679
Insurance			756,187				754,304
Investor relations and transfer agent fee			147,728				125,466
Lease expense and rent			87,851				56,165
Office and miscellaneous			724,691				622,814
Professional fees			432,842				262,168
Research and development			529,705				216,934
Shipping			27,354				20,029
Telecommunications			52,859				45,815
Travel			129,867				192,314
Utilities			283,152				183,012
Wages, administrative salaries and benefits			2,700,745				2,838,118
Total operating expenses			6,321,345				5,915,585
Operating income			3,539,260				4,650,693
Non-operating income (expense)
Gain on investment			54,479				330,750
Loss on sale of investment			-				( 385,123	)
Loss on lease termination			-				( 41,350	)
Interest expense			( 518,610	)			( 465,138	)
Interest income			137,532				141,202
Total non-operating income (expense)			( 326,599	)			( 419,659	)
Income before income tax			3,212,661				4,231,034
Income taxes
Income tax benefit (expense)			( 944,780	)			( 1,190,044	)
Net income			2,267,881				3,040,990
Net income attributable to non-controlling interests			( 1,020,061	)			( 682,110	)
Net income attributable to Flexible Solutions International Inc.		$	1,247,820			$	2,358,880
Net income per share (basic)		$	0.10			$	0.19
Net income per share (diluted)		$	0.09			$	0.19
Weighted average number of common shares (basic)			12,632,338				12,450,257
Weighted average number of common shares (diluted)			13,524,716				12,536,935
Other comprehensive income:
Net income		$	2,267,881			$	3,040,990
Unrealized gain on foreign currency translations			201,509				100,276
Total comprehensive income		$	2,469,390			$	3,141,266
Comprehensive income – non-controlling interest			( 1,020,061	)			( 682,110	)
Comprehensive income attributable to Flexible Solutions International Inc.		$	1,449,329			$	2,459,156

— See Notes to Unaudited Condensed Interim Consolidated Financial Statements —

FLEXIBLE SOLUTIONS INTERNATIONAL, INC.

CONDENSED INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS

(U.S. Dollars — Unaudited)

		2025				2024
		Nine Months Ended September 30,
		2025				2024
Operating activities
Net income for the period		$	2,267,881			$	3,040,990
Adjustments to reconcile net income to cash provided by operations:
Stock based compensation			293,759				513,383
Depreciation and amortization			1,445,015				1,427,655
Gain on investment			( 54,479	)			( 330,750	)
Loss on sale of investment			-				385,123
Changes in operating assets and liabilities:
Accounts receivable, net			2,224,397				1,771,625
Inventories			1,403,397				1,415,130
Prepaid expenses and deposits			670,158				16,760
Long term deposits			( 1,426,696	)			( 1,429,887	)
Accounts payable			83,891				( 1,074,678	)
Accrued liabilities			( 110,694	)			962,046
Income taxes payable			( 34,802	)			1,190,044
Deferred revenue			( 4,629	)			( 99,452	)
Cash provided by operating activities			6,757,198				7,787,989
Investing activities
Net purchases (maturities) of term deposits			1,014,766				319,916
Purchase of property and equipment			( 3,310,168	)			( 2,876,119	)
Return of investment			500,000				-
Distributions received from equity investments			-				430,402
Proceeds from sale of investment			-				2,000,000
Cash used in investing activities			( 1,795,402	)			( 125,801	)
Financing activities
Repayment of short term lines of credit, net			( 1,495,046	)			( 1,810,479	)
Repayment of long term debt			( 1,680,304	)			( 917,692	)
Proceeds from long term debt			-				2,162,412
Dividends paid			( 1,274,753	)			( 1,255,053	)
Distributions to non-controlling interest			( 329,635	)			( 365,644	)
Proceeds from shares issued upon exercise of stock options			467,030				26,250
Cash used in financing activities			( 4,312,708	)			( 2,160,206	)
Effect of exchange rate changes on cash			201,509				100,276
Increase (decrease) of cash			850,597				5,602,258
Cash, beginning			7,631,055				5,017,583
Cash, ending		$	8,481,652			$	10,619,841

— See Notes to Unaudited Condensed Interim Consolidated Financial Statements —

FLEXIBLE SOLUTIONS INTERNATIONAL, INC.

CONDENSED INTERIM Consolidated Statements of Stockholders’ Equity

(U.S. Dollars – Unaudited)

		Shares				Par Value				Capital in Excess of Par Value				Accumulated Earnings				Accumulated Other Comprehensive Loss				Total				Non- Controlling Interests				Total Stockholders’ Equity
Balance December 31, 2024			12,515,532			$	12,516			$	18,789,915			$	19,836,527			$	( 606,986	)		$	38,031,972			$	3,334,054			$	41,366,026
Translation adjustment			—				—				—				—				188,840				188,840				—				188,840
Net income (loss)			—				—				—				( 277,734	)			—				( 277,734	)			13,693				( 264,041	)
Common stock issued upon exercise of options			132,000				132				381,558				—				—				381,690				—				381,690
Stock-based compensation			—				—				97,920				—				—				97,920				—				97,920
Balance March 31, 2025			12,647,532			$	12,648			$	19,269,393			$	19,558,793			$	( 418,146	)		$	38,422,688			$	3,347,747			$	41,770,435
Translation adjustment			—				—				—				—				80,514				80,514				—				80,514
Net income			—				—				—				2,028,912				—				2,028,912				116,322				2,145,234
Common stock issued upon exercise of options			5,000				5				12,195				—				—				12,200				—				12,200
Dividends paid			—				—				—				( 1,274,753	)			—				( 1,274,753	)			—				( 1,274,753	)
Distributions to noncontrolling interests			—				—				—				—				—				—				( 252,169	)			( 252,169	)
Stock-based compensation			—				—				97,920				—				—				97,920				—				97,920
Balance June 30, 2025			12,652,532			$	12,653			$	19,379,508			$	20,312,952			$	( 337,632	)		$	39,367,481			$	3,211,900			$	42,579,381
Translation adjustment			—				—				—				—				( 67,845	)			( 67,845	)			—				( 67,845	)
Net income (loss)			—				—				—				( 503,358	)			—				( 503,358	)			890,046				386,688
Common stock issued upon exercise of options			37,966				37				73,103				—				—				73,140				—				73,140
Distributions to noncontrolling interests			—				—				—				—				—				—				( 77,466	)			( 77,466	)
Stock-based compensation			—				—				97,919				—				—				97,919				—				97,919
Balance September 30, 2025			12,690,498			$	12,690			$	19,550,530			$	19,809,594			$	( 405,477	)		$	38,967,337			$	4,024,480			$	42,991,817

— See Notes to Unaudited Condensed Interim Consolidated Financial Statements —

FLEXIBLE SOLUTIONS INTERNATIONAL, INC.

CONDENSED INTERIM Consolidated Statements of Stockholders’ Equity

(U.S. Dollars – Unaudited)

		Shares				Par Value				Capital in Excess of Par Value				Accumulated Earnings				Accumulated Other Comprehensive Loss				Total				Non- Controlling Interests				Total Stockholders’ Equity
Balance December 31, 2023			12,435,532			$	12,436			$	17,932,015			$	18,053,051			$	( 795,146	)		$	35,202,356			$	3,065,716			$	38,268,072
Translation adjustment			—				—				—				—				27,223				27,223				—				27,223
Net income			—				—				—				457,226				—				457,226				58,983				516,209
Common stock issued upon exercise of options			15,000				15				26,235				—				—				26,250				—				26,250
Stock-based compensation			—				—				253,357				—				—				253,357				—				253,357
Balance March 31, 2024			12,450,532			$	12,451			$	18,211,607			$	18,510,277			$	( 767,923	)		$	35,966,412			$	3,124,699			$	39,091,111
Translation adjustment			—				—				—				—				35,118				35,118				—				35,118
Net income			—				—				—				1,289,796				—				1,289,796				142,637				1,432,433
Dividends paid			—				—				—				( 1,255,053	)			—				( 1,255,053	)			—				( 1,255,053	)
Distributions to noncontrolling interests			—				—				—				—				—				—				( 365,644	)			( 365,644	)
Stock-based compensation			—				—				125,903				—				—				125,903				—				125,903
Balance June 30, 2024			12,450,532			$	12,451			$	18,337,510			$	18,545,020			$	( 732,805	)		$	36,162,176			$	2,901,692			$	39,063,868
Balance			12,450,532			$	12,451			$	18,337,510			$	18,545,020			$	( 732,805	)		$	36,162,176			$	2,901,692			$	39,063,868
Translation adjustment			—				—				—				—				37,935				37,935				—				37,935
Net income			—				—				—				611,858				—				611,858				480,490				1,092,348
Net income (loss)			—				—				—				611,858				—				611,858				480,490				1,092,348
Stock-based compensation			—				—				134,123				—				—				134,123				—				134,123
Balance September 30, 2024			12,450,532			$	12,451			$	18,471,633			$	19,156,878			$	( 694,870	)		$	36,946,092			$	3,382,182			$	40,328,274
Balance			12,450,532			$	12,451			$	18,471,633			$	19,156,878			$	( 694,870	)		$	36,946,092			$	3,382,182			$	40,328,274

— See Notes to Unaudited Condensed Interim Consolidated Financial Statements —

NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Nine Months Ended September 30, 2025

(U.S. Dollars - Unaudited)

1. BASIS OF PRESENTATION

These condensed interim consolidated financial statements (“consolidated financial statements”) include the accounts of Flexible Solutions International, Inc. (the “Company”), its wholly-owned subsidiaries Flexible Fermentation Ltd., NanoChem Solutions Inc. (“NanoChem”), Flexible Solutions Ltd., Flexible Biomass LP, FS Biomass Inc., NCS Deferred Corp., Natural Chem SEZC Ltd., Pana Chem Solutions Inc., InnFlex Holdings Inc., ENP Peru Investments LLC (“ENP Peru”), its 80 % controlling interest in 317 Mendota LLC (“317 Mendota”), and its 65 % controlling interest in ENP Investments, LLC (“ENP Investments”) and ENP Mendota, LLC (“ENP Mendota”). All inter-company balances and transactions have been eliminated upon consolidation. The Company was incorporated on May 12, 1998 in the State of Nevada and in 2019 the Company redomiciled into Alberta, Canada.

In 2022, NanoChem purchased an additional 50 % in ENP Peru, increasing its share to 91.67 %. ENP Investments owned the remaining 8.33 %, of which the Company has a 65 % interest. In 2023, NanoChem purchased the remaining 8.33 % of shares to become sole owner. ENP Peru was previously accounted for under the equity method however, it is now consolidated into the financial statements from the date control was obtained.

In 2023, the Company purchased an 80 % interest in 317 Mendota, a newly incorporated company established to purchase a large manufacturing building. ENP Investments occupies part of this building, freeing up more space in the building owned by ENP Peru for NanoChem. The remaining 20 % non-controlling interest is held by unrelated parties. The manufacturing building was sold after September 30, 2025 (see Note 13).

The Company and its subsidiaries develop, manufacture and market specialty chemicals which slow the evaporation of water. One product, HEATSAVR®, is marketed for use in swimming pools and spas where its use, by slowing the evaporation of water, allows the water to retain a higher temperature for a longer period of time and thereby reduces the energy required to maintain the desired temperature of the water in the pool. Another product, WATERSAVR®, is marketed for water conservation in irrigation canals, aquaculture, and reservoirs where its use slows water loss due to evaporation. In addition to the water conservation products, the Company also manufactures and markets water-soluble chemicals utilizing thermal polyaspartate biopolymers (hereinafter referred to as “TPAs”), which are beta-proteins manufactured from the common biological amino acid, L-aspartic. TPAs can be formulated to prevent corrosion and scaling in water piping within the petroleum, chemical, utility and mining industries. TPAs are also used as proteins to enhance fertilizers in improving crop yields and can be used as additives for household laundry detergents, consumer care products and pesticides. The TPA division also manufactures two nitrogen conservation products for agriculture that slows nitrogen loss from fields and has installed custom equipment used to produce food and nutritional materials. All the ingredients the Company produces are custom products for specific clients and are confidential. The Company anticipates that this market vertical will grow over time. The Company also manufactures food grade products that are made and sold by the TPA division. The TPA division recognizes research and development income from time to time.

2. SIGNIFICANT ACCOUNTING POLICIES

These condensed interim consolidated financial statements have been prepared on a historical cost basis, except where otherwise noted, in accordance with accounting principles generally accepted in the United States applicable to a going concern and reflect the policies outlined below.

In the opinion of management, the accompanying unaudited condensed interim consolidated financial statements contain all adjustments (all of which are of a normal recurring nature) and disclosures necessary for a fair statement of the Company’s financial position as of September 30, 2025 and the results of its operations and cash flows for the nine months then ended. The consolidated balance sheet as of December 31, 2024 is derived from the December 31, 2024 audited financial statements. The unaudited condensed interim consolidated financial statements do not include all disclosures required of annual consolidated financial statements and, accordingly, should be read in conjunction with our annual financial statements for the year ended December 31, 2024. Operating results for the three and nine months ended September 30, 2025 may not be indicative of results expected for the full year ending December 31, 2025.

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For the three and nine months ended September 30, 2025, the Company’s estimated effective tax rate differs from the U.S. federal statutory rate primarily due to the accrual of interest and penalties related to uncertain tax positions. These amounts are recognized as a component of income tax expense. The Company continues to monitor and assess its uncertain tax positions and adjusts its estimates as new information becomes available.

(a) Term Deposits .

The Company has three term deposits that are maintained by commercials banks. The first term deposit is for $ 313,225 and matures in February 2026. This deposit pays 3 % interest and if withdrawn before maturity, a penalty may be applied. The second term deposit is for $ 752,682 , matures in December 2025 and pays interest at a rate of 1.65 %. If withdrawn before maturity, the greater of the loss of accrued interest or $ 150 , plus 1% of the principal shall be levied. The third term deposit is for $ 320,243 , matures in February 2026 and pays interest at a rate of 3 %. If withdrawn before maturity, a penalty may be applied.

(c) Inventories and Cost of Sales .

The Company has three major classes of inventory: completed goods, work in progress and raw materials and supplies. In all classes inventories are stated at the lower of cost or net realizable value. Cost is determined on a first-in, first-out basis or weighted average cost formula to inventories in different subsidiaries. Cost of sales includes all expenditures incurred in bringing the goods to the point of sale. Inventory costs and costs of sales include direct costs of the raw material, inbound freight charges, warehousing costs, handling costs (receiving and purchasing) and utilities and overhead expenses related to the Company’s manufacturing and processing facilities. Shipping and handling charges included in the accompanying condensed interim consolidated statements of operations are as follows:

SCHEDULE OF SHIPPING AND HANDLING CHARGES

		2025				2024				2025				2024
		Three months ended September 30,								Nine months ended September 30,
		2025				2024				2025				2024
Shipping income in product sales		$	94,511			$	98,348			$	304,741			$	387,174
Product sales		$	94,511			$	98,348			$	304,741			$	387,174
Shipping costs in cost of sales		$	196,983			$	192,020			$	566,590			$	701,187
Cost of sales		$	196,983			$	192,020			$	566,590			$	701,187

(c) Research and Development Services .

Income from research and development services is recognized over a period of time as the Company satisfies contractual performance obligations. Costs related to these services are expensed as research and development costs are incurred.

(d) Risk Management .

The Company’s credit risk is primarily attributable to its accounts receivable. The amounts presented in the accompanying condensed interim consolidated balance sheets are net of allowances for doubtful accounts, estimated by the Company’s management based on prior experience and the current economic environment. The Company is exposed to credit-related losses in the event of non-payment by customers. Credit exposure is minimized by dealing with only credit worthy counterparties.

Excluding research and development services revenue, total revenue for the Company’s three primary customers in each period is as follows:

SCHEDULE OF TOTAL REVENUE

		2025				2024				2025				2024
		Three months ended September 30,								Nine months ended September 30,
		2025				2024				2025				2024
Total revenue for three primary customers		$	6,871,525			$	5,549,750			$	14,453,677			$	15,245,382
Total revenue for three primary customers as a percentage of sales			65	%			60	%			54	%			52	%
Research and development services		$	-			$	-			$	2,500,000			$	-
Research and development services as a percentage of sales			-				-				9	%			-

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Total accounts receivable for the Company’s three primary product sales customers for the three and nine months ended September 30, 2025 is as follows:

			September 30, 2025				December 31, 2024
Accounts receivable of three primary customers for three months ended September 30, 2025		$	6,913,858 ( 73 %)			$	7,501,627 ( 64 %)
Accounts receivable of three primary customers for nine months ended September 30, 2025		$	6,496,537 ( 69 %)			$	7,585,199 ( 65 %)

There was no research and development sales account receivable at December 31, 2024 and September 30, 2025.

See Note 3 for allowance for doubtful accounts, all unrelated to our primary or research and development customers.

The credit risk on cash is limited because the Company limits its exposure to credit loss by placing its cash with major financial institutions. The Company maintains cash balances at financial institutions which at times exceed federally insured amounts. The Company has not experienced any losses in such accounts.

(e) Reclassification .

Certain prior year amounts have been reclassified to conform to the 2025 financial statements presentation. Reclassifications had no effect on net income, cash flows, or stockholders’ equity as previously reported.

(f) Recent Accounting Pronouncements .

In December 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-09 ( Topic 740) Improvements to Income Tax Disclosures . The new guidance is intended to enhance annual income tax disclosures to address investor requests for more information about the tax risks and opportunities present in an entity’s operations. The amendments in this standard require disclosure of additional information in specified categories with respect to the reconciliation of the effective tax rate to the statutory rate (the rate reconciliation) for federal, state, and foreign income taxes. They also require greater detail about individual reconciling items in the rate reconciliation to the extent the impact of those items exceeds a specified threshold. In addition to new disclosures associated with the rate reconciliation, the amendments in this update require information pertaining to taxes paid (net of refunds received) to be disaggregated for federal, state, and foreign taxes and further disaggregated for specific jurisdictions to the extent the related amounts exceed a quantitative threshold. The amendments in this update are effective on January 1, 2025 for annual periods beginning after December 15, 2024, and early adoption is permitted. The Company adopted the standard on January 1, 2025 and anticipates disclosure regarding income taxes will be expanded in the annual financial statements for the year ended December 31, 2025.

In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, which requires disclosure about the types of costs and expenses included in certain expense captions presented on the income statement. The new disclosure requirements are effective for the Company’s annual periods beginning after December 15, 2026, and interim periods beginning after December 15, 2027, with early adoption permitted, and may be applied either prospectively or retrospectively. The Company is currently evaluating the ASU to determine its impact on its consolidated financial statements and disclosures.

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3. ACCOUNTS RECEIVABLE

SCHEDULE OF ACCOUNTS RECEIVABLE

		September 30, 2025				December 31, 2024
Accounts receivable		$	9,759,931			$	11,983,200
Allowances for doubtful accounts			( 288,230	)			( 287,102	)
Total accounts receivable		$	9,471,701			$	11,696,098

4. INVENTORIES

SCHEDULE OF INVENTORY

		September 30, 2025				December 31, 2024
Completed goods		$	2,307,887			$	3,060,508
Raw materials and supplies			7,178,911				7,829,687
Total inventory		$	9,486,798			$	10,890,195

5. PROPERTY AND EQUIPMENT

SCHEDULE OF PROPERTY AND EQUIPMENT

		September 30, 2025				Accumulated				September 30, 2025
		Cost				Depreciation				Net
Buildings and improvements		$	11,015,384			$	4,753,805			$	6,261,579
Automobiles			199,845				142,515				57,330
Office equipment			131,856				120,191				11,665
Manufacturing equipment			17,410,126				7,752,564				9,657,562
Land			384,027				—				384,027
Technology			97,991				97,991				—
		$	29,239,229			$	12,867,066			$	16,372,163

		December 31, 2024				Accumulated				December 31, 2024
		Cost				Depreciation				Net
Buildings and improvements		$	12,795,750			$	4,521,212			$	8,274,538
Automobiles			196,255				168,807				27,448
Office equipment			124,526				117,011				7,515
Manufacturing equipment			15,318,758				6,922,667				8,396,091
Land			440,592				—				440,592
Technology			94,945				94,945				—
		$	28,970,826			$	11,824,642			$	17,146,184

Amount of depreciation expense for three months ended September 30, 2025 was $ 444,922 (2024 - $ 448,131 ); the amount of depreciation expenses for the nine months ended September 30, 2025 was $ 1,325,015 (2024 - $ 1,307,655 ) and is included in cost of sales in the unaudited interim condensed consolidated statements of operations and comprehensive income.

At September 30, 2025, the Company also had a building and land under contract for sale with a carrying value of $ 2,759,174 . This amount is included as a current asset on the unaudited condensed interim consolidated balance sheets and not included in the table above. The sale completed in October 2025 (see Note 13).

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6. INVESTMENTS

The Company’s investments at September 30, 2025 and December 31, 2024 consisted of the following:

SCHEDULE OF COMPANY’S INVESTMENTS

		September 30, 2025				December 31, 2024
Investments, at cost:
Lygos Inc., simple agreement for future equity (“SAFE”) agreement		$	1,000,000			$	1,000,000
Trio Opportunity Corp., 47,000 non-voting Class B shares (December 31, 2024 – 97,000 non-voting Class B shares)			470,000				970,000
Investments, at cost			470,000				970,000
Investment, equity method:
Florida-based LLC			1,508,860				1,454,381
Total		$	2,978,860			$	3,424,381

In September 2025, the Company received a return of $ 500,000 on its initial investment of 50,000 Class B shares of Trio Opportunity Corp. The Company still holds 47,000 Class B shares.

In January 2019, the Company invested in a Florida based LLC that is engaged in international sales of fertilizer additives. According to the operating agreement, the Company had a 50 % interest in the profit and loss of the Florida based LLC but did not have control. In August 2024, the Company sold a 30.1 % interest in the Florida based LLC to a third party for consideration of $ 2,000,000 . In addition, the Company entered into a subsequent agreement for the sale of its remaining 19.9 % interest over the next five years for an additional $ 4,000,000 . Starting in 2025, the Company will sell a further 3.98 % per year upon receipt of that year’s $ 800,000 payment. At September 30, 2025, the Company continues to account for this investment using the equity investment as it exercises significant influence.

A summary of the activity associated with the Company’s investment in the Florida based LLC during the nine months ended September 30, 2025 and the year ended December 31, 2024 is follows:

SCHEDULE OF EQUITY METHOD INVESTMENT

Balance, December 31, 2023 – 50% interest		$	4,063,960
Balance, December 31, 2023 – 50 % interest		$	4,063,960
Company’s proportionate share of earnings			244,857
Distribution received			( 510,710	)
Basis of 30.1 % of interest sold			( 2,343,726	)
Balance, December 31, 2024 – 19.9 % interest		$	1,454,381
Company’s proportionate share of earnings			54,479
Balance, September 30, 2025 – 19.9 % interest		$	1,508,860

Summarized profit and loss information related to the Florida based LLC is as follows:

SUMMARY OF PROFIT AND LOSS INFORMATION RELATED TO EQUITY ACCOUNTED INVESTMENT

		Nine months ended September 30, 2025				Nine months ended September 30, 2024
Net sales		$	9,166,935			$	10,164,078
Gross profit		$	2,688,323			$	2,649,689
Net income		$	273,762			$	674,885

During the three months ended September 30, 2025, the Company had sales of $ 1,253,034 (2024 – $ 1,794,263 ) to the Florida based LLC and during the nine months ended September 30, 2025, the Company had sales of $ 5,181,609 (2024 - $ 6,606,882 ) to the Florida based LLC, of which $ 1,557,505 is included within accounts receivable as at September 30, 2025 (December 31, 2024 - $ 1,866,645 ).

7. SHORT-TERM LINES OF CREDIT

( a ) In June 2025, ENP Investments renewed the line of credit with Stock Yards Bank and Trust (“Stock Yards”). The revolving line of credit is for an aggregate amount of up to the lesser of (i) $ 5,000,000 , or (ii) 50 - 80 % of eligible domestic accounts receivable plus 50 % of inventory, capped at $ 2,500,000 . Interest on the unpaid principal balance of this loan will be calculated using the greater of prime or 4.0 %. The interest rate at September 30, 2025 is 7.25 % (December 31, 2024 - 7.5 %).

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The revolving line of credit contains customary affirmative and negative covenants, including the following: compliance with laws, provisions of financial statements and periodic reports, payment of taxes, maintenance of inventory and insurance, maintenance of operating accounts at Stock Yards, Stock Yard’s access to collateral, formation or acquisition of subsidiaries, incurrence of indebtedness, dispositions of assets, granting liens, changes in business, ownership or business locations, engaging in mergers and acquisitions, making investments or distributions and affiliate transactions. NanoChem is a guarantor of 65 % of all the principal and other loan costs not to exceed $ 3,250,000 . The non-controlling interest is the guarantor of the remaining 35 % of all the principal and other loan costs not to exceed $ 1,750,000 .

To secure the repayment of any amounts borrowed under the revolving line of credit, the Company granted Stock Yards a security interest in substantially all of the assets of ENP Investments, exclusive of intellectual property assets.

Short-term borrowings outstanding under the revolving line as of September 30, 2025 were $ nil (December 31, 2024 - $ 2,052,159 ).

(b) In August 2025, the Company renewed the line of credit with Stock Yards Bank and Trust (“Stock Yards”). The revolving line of credit is for an aggregate amount of up to the lesser of (i) $ 2,000,000 , or (ii) 80 % of eligible domestic accounts receivable plus 50 % of inventory, capped at $ 1,000,000 . Interest on the unpaid principal balance of this loan will be calculated using the greater of prime or 4.0 %. The interest rate at September 30, 2025 is 7.25 % (December 31, 2024 - 8 %).

The revolving line of credit contains customary affirmative and negative covenants, including the following: compliance with laws, provision of financial statements and periodic reports, payment of taxes, maintenance of inventory and insurance, maintenance of operating accounts at Stock Yards, Stock Yards access to collateral, formation or acquisition of subsidiaries, incurrence of indebtedness, dispositions of assets, granting liens, changes in business, ownership or business locations, engaging in mergers and acquisitions, making investments or distributions and affiliate transactions. The covenants also require that the Company maintain a minimum ratio of qualifying financial assets to the sum of qualifying financial obligations.

To secure repayment of any amounts borrowed under the revolving line of credit, the Company granted Stock Yards a security interest in substantially all of the assets of NanoChem, exclusive of intellectual property assets.

Short-term borrowings outstanding under the revolving line as of September 30, 2025 were $ 557,113 (December 31, 2024 were $ nil ).

8. LONG TERM DEBT

Long term debt, all of which is with Stock Yards Bank and Trust, at September 30, 2025 and December 31, 2024 consisted of the following:

SCHEDULE OF LONG TERM DEBT

		September 30, 2025				December 31, 2024
ENP Mendota, 10 -year mortgage, 5 year fixed index plus 4.50 % interest ( 7.18 %) monthly payments through to January 2030, collateralized by real property and all rents on said property		$	365,749			$	387,577
NanoChem, 3 -year note payable, 4.90 % interest, monthly principal and interest payments through June 2025, collateralized by real property			-				345,036
ENP Peru, 10 -year mortgage, 7.18 % interest (December 31, 2024 – 4.35 %), monthly principal and interest payments through January 2030, collateralized by real property (1 st mortgage)			2,611,401				2,658,381
ENP Peru, 10 -year mortgage, 5.4 % interest, monthly principal payments plus interest through June 2032, collateralized by real property (2nd mortgage)			239,020				243,957
NanoChem, 3 -year note payable, 6.5 % interest, interest only payments through to July 2024, then monthly principal and interest payments through December 2025, collateralized by manufacturing equipment			347,347				1,355,285
317 Mendota, 5 -year note payable, 6.79 % interest, interest only payments through June 2024, then monthly principal and interest payments through June 2028 with lump sum payment of $ 2,024,710 due in June 2028, collateralized by real property			2,184,591				2,223,667
NanoChem, 5 -year note payable, 7.0 % interest, monthly principal payments plus interest through August 2029, collateralized by manufacturing equipment			1,331,436				1,545,945
Long-term debt			7,079,544				8,759,848
Less: current portion			( 2,932,752	)			( 2,140,981	)
Long-term debt non current		$	4,146,792			$	6,618,867

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The following table summarizes the scheduled annual future principal payments as of September 30, 2025:

SCHEDULE OF ANNUAL FUTURE PRINCIPAL PAYMENTS

Year Ended December 31,		Principal Amount Due
Remainder of 2025		$	2,631,563
2026			415,250
2027			442,783
2028			471,866
Thereafter			3,118,082
Total		$	7,079,544

9. STOCK OPTIONS

The Company has a stock option plan (“Plan”). The purpose of this Plan is to provide additional incentives to key employees, officers, directors and consultants of the Company and its subsidiaries in order to help attract and retain the best available personnel for positions of responsibility and otherwise promote the success of the Company’s business. It is intended that options issued under this Plan constitute non-qualified stock options. The general terms of awards under the option plan are that 100 % of the options granted will vest the year following the grant unless an executive employee is granted a multi-year stock option grant where an equal amount vests over the next 5 years. The maximum term of options granted is 5 years and the exercise price for all options are issued for not less than fair market value at the date of the grant.

The following table summarizes the Company’s stock option activities for the year ended December 31, 2024 and the nine months ended September 30, 2025:

SCHEDULE OF STOCK OPTION ACTIVITIES

		Number of shares				Exercise price per share				Weighted average exercise price
Balance, December 31, 2023			1,114,000			$	1.75 – 3.61			$	3.13
Granted			1,081,000			$	2.00 – 4.05			$	2.12
Cancelled or expired			( 275,000	)		$	1.75 – 3.61			$	2.54
Exercised			( 80,000	)		$	1.75 – 2.44			$	2.31
Balance, December 31, 2024			1,840,000			$	2.00 – 4.05			$	2.68
Cancelled or expired			( 5,034	)		$	2.00 – 3.61			$	3.24
Exercised			( 174,966	)		$	2.00 – 3.61			$	2.84
Balance, September 30, 2025			1,660,000			$	2.00 – 4.05			$	2.67
Exercisable, September 30, 2025			759,000			$	2.00 – 3.61			$	2.69

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During the three and nine months ended September 30, 2025 and 2024, the Company recognized stock based compensation associated with stock options as follows:

SCHEDULE OF RECOGNIZED STOCK BASED COMPENSATION

		2025				2024				2025				2024
		Three months ended September 30,								Nine months ended September 30,
		2025				2024				2025				2024
Line item on the statement of operations and comprehensive income (loss):
Wages, administrative salaries and benefits		$	79,739			$	126,136			$	239,219			$	489,421
Consulting			18,180				7,987				54,540				23,962
Stock based compensation		$	97,919			$	134,123			$	293,759			$	513,383

During the nine months ended September 30, 2025, the Company granted nil (2024 – 56,000 ) stock options to consultants and nil (2024 – 944,000 ) stock options to employees. The fair value of options granted during 2024 was calculated using the following range of assumptions:

SCHEDULE OF STOCK OPTION FAIR VALUE ASSUMPTIONS

		2024
Expected life – years			3.0
Interest rate			1.76 – 4.11	%
Volatility			66.01 – 71.59	%
Fair value of options granted			$ 1.46 – 2.02

As of September 30, 2025, the weighted-average remaining contractual life of outstanding and exercisable options is 2.8 years and 2.6 years, respectively. As of September 30, 2025, there was approximately $ 310,092 of compensation expense related to non-vested awards that is expected to be recognized over a weighted average period of 1.2 years.

The aggregate intrinsic value of options outstanding and exercisable at September 30, 2025 is $ 11,573,559 (2024 - $ 2,022,015 ) and $ 5,274,469 (2024 - $ 637,270 ), respectively. During the nine months ended September 30, 2025, the intrinsic value of stock options exercised was $ 687,633 (2024 - $ 720 ).

10. CAPITAL STOCK

During the nine months ended September 30, 2025, 174,966 shares were issued upon the exercise of stock options (2024 – 15,000 ).

During the nine months ended September 30, 2025, the Company declared a $ 0.10 special dividend payable on May 28, 2025 to shareholders of record on May 19, 2025 for a total payment of $ 1,274,753 .

During the nine months ended September 30, 2024, the Company announced a special dividend of $ 0.10 per share that was paid on May 16, 2024 to shareholders for a total payment of $ 1,255,053 .

11. NON-CONTROLLING INTERESTS

( a ) ENP Investments is a limited liability corporation (“LLC”) that manufactures and distributes golf, turf and ornamental agriculture products in Mendota, Illinois. The Company owns a 65 % interest in ENP Investments through its wholly-owned subsidiary NanoChem. An unrelated party (“NCI”) owns the remaining 35 % interest in ENP Investments. ENP Mendota is a wholly owned subsidiary of ENP Investments. ENP Mendota is a LLC that leases warehouse space. For financial reporting purposes, the assets, liabilities and earnings of both of the LLC’s are consolidated into these condensed interim consolidated financial statements. The NCI’s ownership interest in ENP Investments is recorded in non-controlling interests in these condensed interim consolidated financial statements. The non-controlling interest represents NCI’s interest in the earnings and equity of ENP Investments. ENP Investments is allocated to the TPA segment. See Note 12.

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ENP Investments makes cash distributions to its equity owners based on formulas defined within its Ownership Interest Purchase Agreement dated October 1, 2018. Distributions are defined in the Ownership Interest Purchase Agreement as cash on hand to the extent it exceeds current and anticipated long-term and short-term needs, including, without limitation, needs for operating expenses, debt service, acquisitions, reserves, and mandatory distributions, if any.

From the effective date of acquisition onward, the minimum distributions requirements under the Ownership Interest Purchase Agreement were satisfied. The total distribution from the effective date of acquisition onward was $ 4,350,314 .

SCHEDULE OF DISTRIBUTIONS

Balance, December 31, 2023		$	2,901,199
Distribution			( 794,722	)
Non-controlling interest share of income			1,164,037
Balance, December 31, 2024			3,270,514
Distribution			( 329,635	)
Non-controlling interest share of income			1,095,139
Balance, September 30, 2025		$	4,036,018

During the three months ended September 30, 2025, the Company had sales of $ 5,116,815 (2024 - $ 2,812,736 ) to the NCI and during the nine months ended September 30, 2025, the Company had sales of $ 7,041,541 (2024 - $ 5,238,881 ) to the NCI, of which $ 4,898,789 is included in Accounts Receivable as of September 30, 2025 (December 31, 2024 – $ 5,377,088 ).

b ) 317 Mendota is a LLC that owns real estate that the Company occupies part of while renting out the excess. The Company owns a 80 % interest in 317 Mendota and an unrelated party (“317 NCI”) owns the remaining 20 % interest in 317 Mendota. For financial reporting purposes, the assets, liabilities and earnings of 317 Mendota are consolidated into these condensed interim financial statements and the 317 NCI’s ownership interest in 317 Mendota is recorded in non-controlling interests in these condensed interim consolidated financial statements. The non-controlling interest represents 317 NCI’s interest in the earnings and equity of 317 Mendota. 317 Mendota is allocated to the TPA segment as that is the intended use of the building. See Note 13.

SCHEDULE OF NON CONTROLLING INTEREST RELATED TO ACQUISITION

Balance, December 31, 2023		$	164,517
Non-controlling interest share of income (loss)			( 100,977	)
Balance, December 31, 2024			63,540
Non-controlling interest share of income (loss)			( 75,078	)
Balance, September 30, 2025		$	( 11,538	)

12. SEGMENTS

The Company operates in two segments :

(a) Energy and water conservation products (as shown under the column heading “EWCP” below), which consists of a (i) liquid swimming pool blankets which save energy and water by inhibiting evaporation from the pool surface, and (ii) food-safe powdered form of the active ingredient within the liquid blankets and which are designed to be used in still or slow moving drinking water sources.

(b) Biodegradable polymers, also known as TPA’s (as shown under the column heading “BCPA” below), used by the petroleum, chemical, utility and mining industries to prevent corrosion and scaling in water piping. This product can also be used in detergents to increase biodegradability and in agriculture to increase crop yields by enhancing fertilizer uptake.

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.

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

The Company’s reportable segments are strategic business units that offer different, but synergistic products and services. They are managed separately because each business requires different technology and marketing strategies.

Segment information aligns with how the Company’s Chief Operating Decision Maker (“CODM”) reviews and manages our business. The Company’s CODM is the Company’s Chief Executive Officer. Profit or loss from operations before income taxes, not including nonrecurring gains and losses and foreign exchange gains and losses are reviewed by the CODM at a consolidated level. The CODM assesses performance for each of the Company’s segments and decides how to better allocate resources based on consolidated net income that is reported on the Consolidated Statements of Income. The Company’s objective in making resource allocation decisions is to optimize the consolidated financial results.

Three months ended September 30, 2025:

SCHEDULE OF REPORTABLE SEGMENTS

		EWCP				BPCA				Other (1)				Consolidated
Product sales		$	128,635			$	10,427,656			$	-			$	10,556,291
Cost of sales			28,455				8,004,061				-				8,032,516
Gross profit			100,180				2,423,595				-				2,523,775
Wages, administrative salaries and benefits			38,619				872,099				-				910,718
Office & miscellaneous			13,004				336,120				612				349,736
Other segment items (2)			( 15,935	)			814,421				153,532				952,018
Net operating income (loss)			64,492				400,955				( 154,144	)			311,303
Interest expense			-				136,465				-				136,465
Depreciation and amortization (included in cost of sales)			3,340				481,582				-				484,922
Capital expenditures			-				1,979,126				-				1,979,126
Assets at September 30, 2025 (3)			1,823,376				55,374,547				1,154,863				58,352,786

Three months ended September 30, 2024:

		EWCP				BPCA				Other (1)				Consolidated
Product sales		$	291,830			$	9,023,107			$	-			$	9,314,937
Cost of sales			109,804				5,398,317				-				5,508,121
Gross profit			182,026				3,624,790				-				3,806,816
Wages, administrative salaries and benefits			12,551				872,389				-				884,940
Office & miscellaneous			9,495				257,885				104				267,484
Other segment items (2)			48,818				608,751				82,873				740,442
Net operating income (loss)			111,162				1,885,765				( 82,977	)			1,913,950
Interest expense			309				132,432				-				132,741
Depreciation and amortization (included in cost of sales)			3,840				484,291				-				488,131
Capital expenditures			-				1,212,422				-				1,212,422
Assets at December 31, 2024 (3)			2,588,731				56,415,104				964,744				59,968,579

Nine months ended September 30, 2025:

		EWCP				BPCA				Other (1)				Consolidated
Product sales		$	301,558			$	26,595,557			$	-			$	26,897,115
Research and development sales			-				2,500,000				-				2,500,000
Cost of sales			98,480				19,438,030				-				19,536,510
Gross profit			203,078				9,657,527				-				9,860,605
Wages, administrative salaries and benefits			80,885				2,619,860				-				2,700,745
Office & miscellaneous			35,886				687,326				1,479				724,691
Other segment items (2)			57,723				2,355,141				483,045				2,895,909
Net operating income (loss)			28,584				3,995,200				( 484,524	)			3,539,260
Interest expense			-				518,610				-				518,610
Depreciation and amortization (included in cost of sales)			9,870				1,435,145				-				1,445,015
Capital expenditures			-				3,310,168				-				3,310,168
Assets at September 30, 2025 (3)			1,823,376				55,374,547				1,154,863				58,352,786

18

Nine months ended September 30, 2024:

		EWCP				BPCA				Other (1)				Consolidated
Product sales		$	500,934			$	28,567,614			$	-			$	29,068,548
Cost of sales			281,680				18,220,590				-				18,502,270
Gross profit			219,254				10,347,024				-				10,566,278
Wages, administrative salaries and benefits			63,391				2,774,727				-				2,838,118
Office & miscellaneous			31,394				591,114				306				622,814
Other segment items (2)			141,927				1,995,798				316,928				2,454,653
Net operating income (loss)			( 17,458	)			4,985,385				( 317,234	)			4,650,693
Interest expense			309				464,829				-				465,138
Depreciation and amortization (included in cost of sales)			11,551				1,416,104				-				1,427,655
Capital expenditures			-				2,876,119				-				2,876,119
Assets at December 31, 2024 (3)			2,588,731				56,415,104				964,744				59,968,579
Assets			2,588,731				56,415,104				964,744				59,968,579

	(1)	Other is not considered an operating segment and includes expenses and income not identifiable to an operating segment and is not included in operating segment results
	(2)	Other segment items for each reportable segment includes items such as insurance, consulting, research and development, professional fees, and travel.
	(3)	Segment assets include cash, term deposits, accounts receivable, inventory, prepaid expenses, property and equipment, security deposits, investments, intangible assets, and goodwill.

Sales by territory are shown below:

SCHEDULE OF REVENUE GENERATED IN UNITED STATES AND CANADA

		2025				2024				2025				2024
		Three months ended September 30,								Nine months ended September 30,
		2025				2024				2025				2024
Canada		$	215,234			$	6,873			$	670,349			$	229,956
United States and abroad		$	10,341,057			$	9,308,064			$	28,726,766			$	28,838,592
Total		$	10,556,291			$	9,314,937			$	29,397,115			$	29,068,548

The Company’s long-lived assets (property, equipment, intangibles, and goodwill) are located in Canada and the United States and abroad as follows:

SCHEDULE OF LONG-LIVED ASSETS ARE LOCATED IN CANADA AND UNITED STATE

		September 30, 2025				December 31, 2024
Canada		$	110,334			$	116,496
United States and abroad			20,796,104				21,683,963
Total		$	20,906,438			$	21,800,459

13. SUBSEQUENT EVENTS

In October 2025, the Company completed the sale of the building and land owned by 317 Mendota. The building and land was sold for $ 3,750,000 and the Company paid off the $ 2,184,591 mortgage held with Stock Yards Bank. EnP Investments will continue to rent from the new owners.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

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 and Comprehensive Income (Loss) for nine and three months ended September 30, 2025 compared to the same period in the prior year are discussed below:

Three Months ended September 30, 2025

Item		Increase (I) or Decrease (D)		Reason
Sales
EWCP products		D		Decreased customer orders.
TPA products		I		Increased customer orders.
Gross profit as a percentage of sales		D		Increased costs associated with scaling up new products.

Consulting		D		Decreased reliance on consultants.
Office and miscellaneous		I		Increase related to building repair and maintenance.
Professional fees		I		Increase in accounting fees related to tax filings and increase in audit fees related to growth of the Company.
Research and development		I		New product development.
Utilities		I		Increase related to increase in production hours.
Gain on investment		D		Sale of 30.1% of Florida based LLC in 2024 reduced our Company’s portion of the profits.
Loss on sale of investment		D		One time loss on the sale of 30.1 % of Florida based LLC in 2024.
Interest income		I		Increased interest rates.

Nine Months ended September 30, 2025

Item		Increase (I) or Decrease (D)		Reason
Sales
EWCP products		D		Decreased customer orders.
TPA products		D		Decreased customer orders.
Research and development services		I		Due to a successful project that completed in 2025.
Advertising and promotion		I		Increase in marketing.
Consulting		D		Decreased reliance on consultants.
Office and miscellaneous		I		Increase related to building repair and maintenance.
Professional fees		I		Increase in accounting fees related to tax filings and increase in audit fees related to growth of the Company.
Research and development		I		New product development.
Travel		D		Travel requirements were lower for the first nine months in 2025 than in 2024.

Utilities		I		Increase related to increase in production hours.
Gain on investment		D		Sale of 30.1% of Florida based LLC in 2024 reduced our Company’s portion of the profits.
Loss on sale of investment		D		One time loss on the sale of 30.1 % of Florida based LLC in 2024.
Interest expense		I		Increase of interest rate on one of the mortgages.

Three customers accounted for 65% of our product sales during the three months ended September 30, 2025 (2024 –60%) and 54% of our product sales during the nine months ended September 30, 2025 (2024 – 52%). The amount of revenue (all from the sale of TPA products) attributable to each customer is shown below. Research and development services sales are not included in product sales

		Three months ended September 30,								Nine months ended September 30,
Customer		2025				2024				2025				2024
Company A		$	5,116,815			$	2,812,736			$	7,041,541			$	5,238,881
Company B		$	1,253,034			$	1,794,262			$	5,181,609			$	6,606,882
Company C		$	411,435	*		$	942,752			$	2,230,577			$	3,399,619
Company D		$	501,676			$	-			$	982,517	*		$	742,429	*

*not a primary customer in that period

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

		September 30,
		2025				2024
Company A		$	4,898,789			$	2,571,320
Company B		$	1,557,505			$	1,434,835

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 nine months ended September 30, 2025 and 2024 are shown below:

		2025				2024
Cash provided by operating activities			6,757,198				7,787,989
Net purchases (maturities) of term deposits			1,014,766				319,916
Purchase of property and equipment			(3,310,168	)			(2,876,119	)
Return of investment			500,000				-
Distributions received from equity investments			-				430,402
Proceeds from sale of investment			-				2,000,000
Repayment of short term lines of credit, net			(1,495,046	)			(1,810,479	)
Repayment of long term debt			(1,680,304	)			(917,692	)
Proceeds from long term debt			-				2,162,412
Dividends paid			(1,274,753	)			(1,255,053	)
Distributions to non-controlling interest			(329,635	)			(365,644	)
Proceeds from shares issued upon exercise of stock options			467,030				26,250
Effect of exchange rate change on cash			201,509				100,276

The Company has sufficient cash resources to meets its future commitments and cash flow requirements for the coming year. As of September 30, 2025, working capital was $21,780,752 (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 capital requirements for the twelve months ending September 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.

Item 4. CONTROLS AND PROCEDURES.

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 September 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 September 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 September 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 September 30, 2025 that materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II

Item 5. Other Information

None of our directors or officers adopted or terminated a Rule 10b5-1 trading arrangement or a non-Rule 10b5-1 trading arrangement (as defined in Item 408(c) of Regulation S-K) during the quarterly period ending September 30, 2025

Item 6. Exhibits.

Number		Description
3.1		Articles of Continuance (Articles of Incorporation) (1)
3.2		Bylaws (2)
31.1		Certification of Principal Executive Officer Pursuant to §302 of the Sarbanes-Oxley Act of 2002.*
31.2		Certification of Principal Financial Officer Pursuant to §302 of the Sarbanes-Oxley Act of 2002.*
32.1		Certification of Principal Executive and Financial Officer Pursuant to 18 U.S.C. §1350 and §906 of the Sarbanes-Oxley Act of 2002.*
101.INS		Inline XBRL Instance Document
101.SCH		Inline XBRL Taxonomy Extension Schema Document
101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF		Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB		Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase Document
104		Cover Page Interactive Data File (embedded within the Inline XBRL document)

* Filed with this report.

(1)	Incorporated by reference the same exhibit filed with the Company’s March 31, 2022 10-Q report.
(2)	Incorporated by reference to Exhibit 3(ii) filed the Company’s 8-K report dated April 10, 2022.

SIGNATURES

In accordance with the requirements of Section 13 or 15(d) of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

November 14, 2025

	Flexible Solutions International, Inc.
	By:	/s/ Daniel B. O’Brien
	Name:	Daniel B. O’Brien
	Title:	President and Principal Executive Officer
	By:	/s/ Daniel B. O’Brien
	Name:	Daniel B. O’Brien
	Title:	Principal Financial and Accounting Officer