UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10QSB

    [X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
        ACT OF 1934

                  For the quarterly period ended JUNE 30, 2004
                                                 -------------

    [ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT


                      FLEXIBLE SOLUTIONS INTERNATIONAL INC.
                      -------------------------------------
        (Exact name of small business issuer as specified in its charter)

                                     NEVADA
                                     ------
         (State or other jurisdiction of incorporation or organization)

                                   91-1922863
                                   ----------
                        (IRS Employer Identification No.)

                 2614 Queenswood Dr. Victoria BC Canada V8N 1X5
                 ----------------------------------------------
                    (Address of principal executive offices)

                                (250) 477 - 9969
                                ----------------
                           (Issuer's telephone number)


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


                      APPLICABLE ONLY TO CORPORATE ISSUERS

State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date:

       Common stock $.001 par value 11,831,916 shares as of June 30, 2004
       ------------------------------------------------------------------

    Transitional Small Business Disclosure Format (Check one): Yes [ ] No [X]









                                       -1-
<PAGE>
                         PART I - FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS.

<TABLE>
<CAPTION>
FLEXIBLE SOLUTIONS INTERNATIONAL INC.
CONSOLIDATED BALANCE SHEETS
JUNE 30, 2004
(UNAUDITED - U.S. DOLLARS)

---------------------------------------------------------------------------------------------
                                                                JUNE 30          DECEMBER 31
                                                                  2004               2003
---------------------------------------------------------------------------------------------
<S>                                                           <C>                <C>
Assets

CURRENT
  Cash and cash equivalents                                     $ 738,337          $ 237,080
  Short term investments                                        1,334,649          5,033,837
  Accounts receivable                                             533,220            294,238
  Income tax receivable                                            84,003             86,243
  Loan receivable                                                  17,540             17,585
  Inventory                                                       841,398            212,938
  Prepaid expenses                                                 69,820             36,101
---------------------------------------------------------------------------------------------

                                                                3,618,967          5,918,022
PROPERTY AND EQUIPMENT                                          5,252,053            167,589
INVESTMENT                                                        303,500            303,500
---------------------------------------------------------------------------------------------

                                                              $ 9,174,520         $6,389,111
---------------------------------------------------------------------------------------------

LIABILITIES

CURRENT
  Due to shareholders                                                   -              7,700
  Short term loan                                               3,150,000
  Accounts payable and accrued liabilities                        189,195          $ 157,643
---------------------------------------------------------------------------------------------
                                                                3,339,195            165,343

STOCKHOLDERS' EQUITY

CAPITAL STOCK
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
  11,831,916 (2003: 11,794,916) common shares                      11,832             11,794
CAPITAL IN EXCESS OF PAR VALUE                                  7,499,305          7,306,613
OTHER COMPREHENSIVE INCOME (LOSS)                                       -              3,023
DEFICIT                                                        (1,675,812)        (1,097,662)
---------------------------------------------------------------------------------------------

TOTAL STOCKHOLDER'S EQUITY                                      5,835,325          6,223,768
---------------------------------------------------------------------------------------------

TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY                    $ 9,174,520         $6,389,111
---------------------------------------------------------------------------------------------
</TABLE>
                                      -2-
<PAGE>
<TABLE>
<CAPTION>
FLEXIBLE SOLUTIONS INTERNATIONAL INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
SIX MONTHS ENDED JUNE 30, 2004 AND 2003
(UNAUDITED - U.S. DOLLARS)

                                                                   2004                   2003
--------------------------------------------------------------------------------------------------
<S>                                                           <C>                    <C>
SALES                                                          $ 1,035,871            $ 1,942,562
COST OF SALES                                                      411,007              1,095,902
--------------------------------------------------------------------------------------------------

GROSS PROFIT                                                       624,864                846,660
--------------------------------------------------------------------------------------------------

OPERATING EXPENSES
  Wages                                                            257,716                333,872
  Administrative salaries and benefits                              57,544                 39,475
  Advertising and promotion                                         56,792                 29,158
  Investor relations and transfer agent fee                        122,625                 68,667
  Office and miscellaneous                                          96,922                 34,775
  Rent                                                              52,216                 37,522
  Consulting                                                       188,816                 82,651
  Professional fees                                                107,714                127,873
  Travel                                                            49,514                 78,419
  Telecommunications                                                14,714                 24,600
  Shipping                                                          10,797                  8,278
  Research                                                          15,842                 19,704
  Bad debt expense (recovery)                                         (797)                     -
  Currency exchange                                                  3,324                 62,959
  Utilities                                                         14,198                 10,227
  Depreciation                                                     185,547                 15,927
--------------------------------------------------------------------------------------------------

                                                                 1,233,484                974,107
--------------------------------------------------------------------------------------------------

INCOME (LOSS) BEFORE INTEREST INCOME AND INCOME TAX               (608,620)              (127,447)
INTEREST INCOME                                                     30,470                104,246
--------------------------------------------------------------------------------------------------

INCOME (LOSS) BEFORE INCOME TAX                                   (578,150)               (23,201)
INCOME TAX (RECOVERY)                                                                      26,094
--------------------------------------------------------------------------------------------------

NET INCOME (LOSS)                                                 (578,150)               (49,295)

DEFICIT, BEGINNING                                              (1,097,662)            (3,100,974)
--------------------------------------------------------------------------------------------------

DEFICIT, ENDING                                               $ (1,675,812)          $ (3,150,269)

NET INCOME (LOSS) PER SHARE                                          (0.05)                 (0.00)
--------------------------------------------------------------------------------------------------

WEIGHTED AVERAGE NUMBER OF SHARES                               11,819,916             11,677,988
--------------------------------------------------------------------------------------------------
</TABLE>
                                      -3-
<PAGE>
<TABLE>
<CAPTION>
FLEXIBLE SOLUTIONS INTERNATIONAL INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
THREE MONTHS ENDED JUNE 30, 2004 AND 2003
(UNAUDITED - U.S. DOLLARS)

                                                                   2004                   2003
--------------------------------------------------------------------------------------------------
<S>                                                           <C>                    <C>
SALES                                                            $ 547,761              $ 661,296
COST OF SALES                                                      105,088                408,835
--------------------------------------------------------------------------------------------------

GROSS PROFIT                                                       442,673                252,461
--------------------------------------------------------------------------------------------------

OPERATING EXPENSES
  Wages                                                            143,246                195,202
  Administrative salaries and benefits                              32,697                 21,833
  Advertising and promotion                                         49,062                 13,094
  Investor relations and transfer agent fee                         57,947                 35,547
  Office and miscellaneous                                          62,332                  4,817
  Rent                                                              30,867                 23,124
  Consulting                                                       114,138                 30,719
  Professional fees                                                 71,206                104,810
  Travel                                                            25,938                 44,235
  Telecommunications                                                 9,014                 15,838
  Shipping                                                           7,655                  4,586
  Research                                                           6,681                  2,173
  Bad debt expense (recovery)                                         (797)                     -
  Currency exchange                                                  2,902                 46,792
  Utilities                                                          8,833                 10,227
  Depreciation                                                     175,595                  8,116
--------------------------------------------------------------------------------------------------

                                                                   797,316                561,113
--------------------------------------------------------------------------------------------------

INCOME (LOSS) BEFORE INTEREST INCOME AND INCOME TAX               (354,643)              (308,652)
INTEREST INCOME                                                     27,354                 53,978
--------------------------------------------------------------------------------------------------

INCOME (LOSS) BEFORE INCOME TAX                                   (327,289)              (254,674)
INCOME TAX (RECOVERY)                                                                     (24,598)
--------------------------------------------------------------------------------------------------

NET INCOME (LOSS)                                                 (327,289)              (230,076)

DEFICIT, BEGINNING                                              (1,348,523)            (2,920,193)
--------------------------------------------------------------------------------------------------

DEFICIT, ENDING                                               $ (1,675,812)          $ (3,150,269)

NET INCOME (LOSS) PER SHARE                                          (0.03)                 (0.02)
--------------------------------------------------------------------------------------------------

WEIGHTED AVERAGE NUMBER OF SHARES                               11,819,916             11,709,916
--------------------------------------------------------------------------------------------------
</TABLE>
                                      -4-
<PAGE>
<TABLE>
<CAPTION>
FLEXIBLE SOLUTIONS INTERNATIONAL INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS ENDED JUNE 30, 2004 AND 2003
(UNAUDITED - U.S. DOLLARS)

--------------------------------------------------------------------------------------------------
                                                                    SIX MONTHS ENDED JUNE 30
                                                                   2004                   2003
--------------------------------------------------------------------------------------------------
<S>                                                           <C>                    <C>
OPERATING ACTIVITIES
  Net income (loss)                                           $   (578,150)          $    (49,297)
  Stock compensation expense                                       135,230                 56,591
  Depreciation                                                     185,547                 15,927
Changes in non-cash working capital items:
  Accounts receivable                                             (238,982)              (490,487)
  Inventory                                                       (628,460)                57,589
  Prepaid expenses                                                 (33,719)               (14,124)
  Accounts payable                                                  31,552                 10,777
  Income tax receivable                                              2,240                 87,024
  Decrease in due to shareholders                                   (7,700)                     -
  Unrealized foreign exchange gain/loss                                  -                      -

CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES                 (1,132,442)              (326,000)
--------------------------------------------------------------------------------------------------

INVESTING ACTIVITIES
  Acquisition of property and equipment                         (5,270,011)               (41,799)
  Short-term investments                                         3,699,188                (91,071)
  Loan receivable                                                       45                 (1,827)
  Acquisition of investments                                             -               (271,000)
--------------------------------------------------------------------------------------------------

CASH USED IN INVESTING ACTIVITIES                               (1,570,778)              (405,697)
--------------------------------------------------------------------------------------------------

FINANCING ACTIVITY
  Subscriptions received                                                 -                 (4,560)
  Short term loan                                                3,150,000
  Proceeds from issuance of common stock                            57,500                325,319
--------------------------------------------------------------------------------------------------

CASH PROVIDED BY FINANCING ACTIVITIES                            3,207,500                320,759
--------------------------------------------------------------------------------------------------

Effect of exchange rate changes on cash                             (3,023)                94,933
--------------------------------------------------------------------------------------------------

INFLOW (OUTFLOW) OF CASH                                           501,257               (316,005)
Cash and cash equivalents, beginning of period                     237,080                556,789
--------------------------------------------------------------------------------------------------

CASH AND CASH EQUIVALENTS, END OF PERIOD                      $    738,337  $             240,784
--------------------------------------------------------------------------------------------------

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
  Income taxes paid                                           $          -  $              78,378
  Interest received                                           $     30,470  $             104,246
--------------------------------------------------------------------------------------------------
</TABLE>

                                      -5-
<PAGE>
         FLEXIBLE SOLUTIONS INTERNATIONAL INC.
         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
         PERIODS ENDED JUNE 30
         (U.S. DOLLARS)
         (UNAUDITED)



         1.       BASIS OF PRESENTATION

                  These unaudited consolidated financial statements have been
                  prepared in accordance with generally accepted accounting
                  principles in the United States for interim financial
                  information. These financial statements are condensed and do
                  not include all disclosures required for annual financial
                  statements. The organization and business of the Company,
                  accounting policies followed by the Company and other
                  information are contained in the notes to the Company's
                  audited consolidated financial statements filed as part of the
                  Company's December 31, 2003 Annual Report on Form 10-KSB. This
                  quarterly report should be read in conjunction with such
                  annual report.

                  In the opinion of the Company's management, these consolidated
                  financial statements reflect all adjustments necessary to
                  present fairly the Company's consolidated financial position
                  at June 30, 2004 and the consolidated results of operations
                  and the consolidated statements of cash flows for the six
                  months ended June 30, 2004 and 2003. The results of operations
                  for the three months ended June 30, 2004 are not necessarily
                  indicative of the results to be expected for the entire fiscal
                  year.

         2.       SIGNIFIGANT ACCOUNTING POLICIES

                  These consolidated financial statements have been prepared in
                  accordance with generally accepted accounting principles
                  accepted in the United States of America applicable to a going
                  concern and reflect the policies outlined below.

                  a) Cash and Cash Equivalents -

                  The company considers all highly liquid investments purchased
                  with an original or remaining maturity of less than three
                  months at the date of purchase to be cash equivalents. Cash
                  and cash equivalents are maintained with several financial
                  institutions.

                  b) Inventory -

                  Inventory is valued at the lower of cost and net realizable
                  value. Cost is determined on a first-in, first-out basis.

                c) Property, Equipment and Leaseholds -

                The following assets are recorded at cost and depreciated using
                the following methods using the following annual rates:
                      Computer hardware           30% Declining balance
                      Furniture and fixtures      20% Declining balance
                      Manufacturing equipment     20% Declining balance
                      Office equipment            20% Declining balance
                      Trailer                     30% Declining balance
                      Building                    10% Declining balance
                      Leasehold improvements      Straight-line over lease term

                Property and equipment are written down to net realizable value
                when management determines there has been a change in
                circumstances which indicates its carrying amount may not be
                recoverable. No write downs have been necessary to date.

                                      -6-
<PAGE>
         FLEXIBLE SOLUTIONS INTERNATIONAL INC.
         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
         PERIODS ENDED JUNE 30
         (U.S. DOLLARS)
         (UNAUDITED)



                d) Foreign Currency -

                The functional currency of the company is the Canadian dollar.
                The translation of the Canadian dollar to the reporting currency
                of the U.S. dollar is performed for current assets and current
                liabilities using exchange rates in effect at the balance sheet
                date. Non-monetary assets and liabilities are translated using
                rates prevailing at the time of the acquisition of the assets or
                assumption of the liabilities. Revenue and expense transactions
                are translated using average exchange rates prevailing during
                the year. Translation adjustments arising on conversion of the
                financial statements from the company's functional currency,
                Canadian dollars, into the reporting currency, U.S. dollars, are
                excluded from the determination of income and disclosed as other
                comprehensive income (loss) in stockholders' equity.

                Foreign exchange gains and losses relating to transactions not
                denominated in the applicable local currency are included in
                income if realized during the year and in comprehensive income
                if they remain unrealized at the end of the year.

                e) Revenue Recognition -

                Revenue from product sales is recognized at the time the product
                is shipped since title and risk of losses is transferred to
                purchaser upon delivery to the carrier. Shipments are made
                F.O.B. shipping point. Provisions are made at the time the
                related revenue is recognized for estimated product returns.
                Since the company's inception, product returns have been
                insignificant, therefore no provision has been established for
                estimated product returns.


                f) Stock Issued in Exchange for Services -

                The valuation of the common stock issued in exchange for
                services is valued at an estimated fair market value as
                determined by officers and directors of the company based upon
                trading prices of the company's common stock on the dates of the
                stock transactions.

                g) Stock Based Compensation -

                The company applies APB Opinion No. 25 and related
                interpretations in accounting for its employee stock option
                plans. Compensation expense is recorded when options are granted
                to management at discounts to market.

                h) Comprehensive Income -

                Other comprehensive income refers to revenues, expenses, gains
                and losses that under generally accepted accounting principles
                are included in comprehensive income but are excluded from net
                income as these amounts are recorded directly as an adjustment
                to stockholders' equity. The company's other comprehensive
                income is primarily comprised of unrealized foreign exchange
                gains and losses.

                i) Income (Loss) Per Share -

                Income (loss) per share is calculated by dividing net income
                (loss) by the weighted average number of shares outstanding.


                                      -7-
<PAGE>
         FLEXIBLE SOLUTIONS INTERNATIONAL INC.
         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
         PERIODS ENDED JUNE 30
         (U.S. DOLLARS)
         (UNAUDITED)



                j) Use of Estimates -

                The preparation of consolidated financial statements in
                conformity with accounting principles generally accepted in the
                United States of America requires management to make estimates
                and assumptions that affect the reported amounts of assets and
                liabilities at the date of the consolidated financial statements
                and the reported amounts of revenues and expenses during the
                reporting period. Actual results could differ from those
                estimates and would impact the results of operations and cash
                flows.

                k) Financial Instruments -

                The fair market value of the company's financial instruments
                comprising cash, short-term investment, accounts receivable,
                income tax recoverable, loan receivable, accounts payable and
                accrued liabilities and amounts due to shareholders were
                estimated to approximate their carrying values due to immediate
                or short-term maturity of these financial instruments.

                The company is exposed to foreign exchange and interest rate
                risk to the extent that market value rate fluctuations
                materially differ from financial assets and liabilities subject
                to fixed long-term rates.

                l) Recent Accounting Pronouncements -

                i)   In June 2001, the Financial Accounting Standards Board
                     (FASB) issued FAS 142, Goodwill and Other Intangible
                     Assets. Under FAS 142, goodwill and intangible assets with
                     indefinite lives are no longer amortized but are reviewed
                     at least annually for impairment. The amortization
                     provisions of FAS 142 apply to goodwill and intangible
                     assets acquired after June 30, 2001. With respect to
                     goodwill and intangible assets acquired prior to July 1,
                     2001, the company adopted FAS 142 effective January 1,
                     2002. Application of the non-amortization provisions of FAS
                     142 for goodwill did not have any impact on its financial
                     reporting

                ii)  In October 2001, the FASB issued Statement of Financial
                     Accounting Standards for FAS 144, "Accounting for the
                     Impairment or Disposal of Long-Lived Assets." FAS 144
                     addresses significant issues relating to the implementation
                     of FAS 121, "Accounting for the Impairment of Long-Lived
                     Assets and for Long-Lived Assets to be Disposed Of," and
                     develops a single accounting model, based on the framework
                     established in FAS 121 for long-lived assets to be disposed
                     of by sale, whether such assets are or are not deemed to be
                     a business. FAS 144 also modifies the accounting and
                     disclosure rules for discontinued operations. The standard
                     was adopted on January 1, 2002 and did not have any impact
                     on the financial statements.

                  In November 2001, the FASB issued EITF Issue No. 01-14,.
                  "Income Statement Characterization of Reimbursements Received
                  for "Out of Pocket" Expenses Incurred." This guidance requires
                  companies to recognize the recovery of reimbursable expenses
                  such as travel costs on service contracts as revenue. These
                  costs are not to be netted as a reduction of cost. This
                  guidance was implemented January 1, 2002. The company does not
                  expect this guidance to have a material impact on the
                  financial statements

                                      -8-
<PAGE>
         FLEXIBLE SOLUTIONS INTERNATIONAL INC.
         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
         PERIODS ENDED JUNE 30
         (U.S. DOLLARS)
         (UNAUDITED)




         3.       PROPERTY, EQUIPMENT AND LEASEHOLDS AT JUNE 30
<TABLE>
<CAPTION>
                                                       Accumulated
                                                Cost   Amortization     2004          2003
                                                                        Net            Net
<S>                                        <C>         <C>         <C>            <C>
                  Computer hardware        $   33,587  $    9,576  $   24,011     $    7,365
                  Furniture and equipment      12,278       2,583       9,695          3,268
                  Office equipment             25,745       8,210      17,535         19,875
                  Manufacturing equipment   1,996,107     197,738   1,798,369        117,344
                  Trailer                       1,740         475       1,265              -
                  Building                  3,082,956      77,074   3,005,882              -
                  Leasehold improvements       12,918       8,046       4,873          6,585
                  Land                        390,422           -     390,422              -
                  --------------------------------------------------------------------------

                                           $5,555,754  $  303,701  $5,252,053     $  154,438
                  ==========================================================================
</TABLE>



         4.       STOCKHOLDERS' EQUITY

                  (a)      During the prior periods, the Company granted stock
                           options to consultants and have recognized consulting
                           expense applying SFAS 123 using the Black-Scholes
                           option pricing model which resulted in expense of
                           $68,295 for the three months ended June 30, 2004.

                  (b)      The following table summarizes the Company's stock
                           option activity for the period:
<TABLE>
<CAPTION>
                           ----------------------------------------------------------------------------------
                                                              2004
                                                                                                   Weighted
                                                                              Exercise             Average
                                                             Number             Price              Exercise
                                                            of Shares         Per Share             Price
                           ----------------------------------------------------------------------------------
<S>                                                        <C>           <C>                        <C>
                           Balance, March 31, 2004          1,669,000      $1.20 to $4.55             $ 3.18
                           Granted During the Period           77,000      $4.25 to $4.55               4.37
                           Exercised                         (12,000)     $(1.00 to $1.50)             (1.42)
                           ----------------------------------------------------------------------------------
                           Balance, June 30, 2004           1,734,000      $1.00 to $ 4.25            $ 3.06
                           ----------------------------------------------------------------------------------
</TABLE>

                                      -9-
<PAGE>
         FLEXIBLE SOLUTIONS INTERNATIONAL INC.
         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
         PERIODS ENDED JUNE 30
         (U.S. DOLLARS)
         (UNAUDITED)

         5.       ACQUISITION OF ASSETS OF DONLAR CORPORATION

                  Pursuant to a purchase agreement dated May 26, 2004, the
                  company acquired the assets of Donlar Corporation on June 9,
                  2004.

                  The purchase price of the transaction was $6,150,000 with
                  consideration being a combination of cash and debt. Under the
                  purchase agreement and as part of the consideration, the
                  company issued a promissory note bearing interest at the prime
                  rate to the vendor to satisfy $3,150,000 of the purchase
                  price.

                  The following table summarizes the estimated fair value of the
                  assets acquired at the date of acquisition:
<TABLE>
<CAPTION>
                  As at June 9, 2004:
<S>                                                                          <C>
                  Current assets                                             $  1,126,805
                  Property and equipment                                        5,023,195
                  -----------------------------------------------------------------------
                                                                             $  6,150,000
                  Acquisitions costs assigned to property and equipment           219,475
                  -----------------------------------------------------------------------

                        Total assets acquired                                $  6,369,475
                  =======================================================================
</TABLE>

         6.       CONTIGENCIES


                  a)  The company has been named as a plaintiff in a lawsuit
                      filed in the state of Illinois by a former employee. In
                      November 2003, an ex-employee, Patrick Grant filed suit
                      against Flexible Solutions in Cook County Circuit Court,
                      Cook County IL, claiming wrongful dismissal and seeking
                      return of options rights or cash. The company believes
                      these allegations are without merit and intends to
                      vigorously defend against them.

                  b)  The company is plaintiff in a lawsuit demanding return of
                      the share certificate of 100,000 shares of stock
                      originally given to the defended as payment in advance for
                      services. The services for which the advance was given
                      were never performed or given to the company, and the
                      company therefore received no consideration or value for
                      such advance. Return of the share certificate for 100,000
                      shares was demanded within ten (10) days, namely August
                      22, 2001, however, to date remains unreturned.

                      On date of issue, January 4, 2001, the share transaction
                      was recorded as shares issued for services at fair market
                      value, a value of $0.80 per share.

                                      -10-
<PAGE>
ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS

The following information contains certain forward looking statements that
anticipate future trends or events. These statements are based on certain
assumptions that may prove to be erroneous and are subject to certain risks
including but not limited to the risks of increased competition in the Company's
industry and other risks detailed in the Company's Securities and Exchange
Commission filings. Accordingly, actual results may differ, possibly materially,
from the predictions contained herein.

During the three months ended June 30th 2004, the Company experienced a net loss
of $327,289 as compared to a loss of $230,076 for the three months ended June
30th 2003. The loss resulted from the following: a continued loss from
operatioins including wages, travel and overhead in our Water$avr division
required by the world wide sales effort, start up expenses for the new Ecosavr
marketing office in Richmond BC, and a very large increase in depreciation
($175,596 vs $8,116) resulting from the acquisition of depreciable assets from
the bankruptcy estate of Donlar Corp on June 9th 2004. Our gross profit
increased from 38.3% to 80.8%. The ratio was positively affected by the
increased efficiency in our Calgary factory, the increase in revenue per unit
sold resulting from taking over the distribution of the Ecosavr residential
product and the addition of some low cost sales from the new NanoChem division.
Total sales in the swimming pool division were less than the previous year as a
result of excess product in the retail pipeline from product purchased in first
quarter 2004 and last quarter 2003 by our ex-distributor working its way through
the retail channels. Management believes that this product is now in the hands
of end users and residential sales will soon return to higher levels and at
twice the price per unit realized in 2003.



RESULTS OF OPERATIONS

The following analysis and discussion pertains to the Company's results of
operations for the three month and six month periods ended June 30th 2004
compared to the results of operations for the three month and six month periods
ended June 30th 2003, and to changes in the Company's financial condition from
December 31st 2003 to June 30th 2004.

THREE MONTHS ENDED June 30th 2004 and 2003

For the second quarter of the current fiscal year ending June 30th 2004, sales
were $547,761 compared to $661,296 for the same quarter of the previous year.
The small decrease in sales was a direct result of a one time switch in our
residential pool division from sales through external distribution to internal
distribution by our own employees. The previous distributor, Sunsolar Energy
Technologies, whose contract ended on February 29th 2004, preordered significant
quantities of product in anticipation of the lapse of the contract and that
purchase prevented us from realizing the dollar value of sales normally expected
in 2nd quarter. Sales from our newly formed NanoChem division mitigated this
somewhat and management expects that unit sales in residential pool products
will return to historical levels in 3rd quarter 2004.

Operating expenses were $797,316 for the second quarter, up from $561,113. Wages
decreased from $195,202 to $143, 246 as a result of reorganization and
efficiency increases in the Watersavr division. There were also reductions in
travel from 44,235 down to 25,938, in telecom from 15,838 down to 9,014 and in
professional fees down from 104,810 to 71,206 as we gained better control of
marketing costs in our Watersavr division. On the other hand, our costs for
consulting rose to 114,138 from 30,719, advertising rose to 49,062 from 13,094
as we became responsible for distribution of Ecosavr, and depreciation soared
from 8,116 to 175,595 resulting from acquisition of depreciable assets for cash
from the estate of Donlar Corp.

                                      -11-
<PAGE>
The net loss of $327,289 for the quarter represents an increase over second
quarter last year when the net loss was $230,076. The increased loss can be
attributed to the depreciation of assets acquired from the estate of Donlar
Corp. The loss per share was $0.03 for the three months ended June 30th 2004
compared to $0.02 for the three months ended June 30th 2003.

SIX MONTHS ENDED June 30th 2004

Sales in the six months ended June 30th 2004 were $1,035,871 compared to
$1,942,562 for the six months ended June 30th 2003. The large decrease in sales
was due to the following factors. In the comparable period of 2003, there were
sales of $473,000 in the Watersavr division that were not repeated this year
because the distributor responsible was unable to meet contractual quotas and
was terminated. The residential pool product distributor whose contract ended on
Feb 29th 2004 preordered large amounts of product in 4th quarter 2003 for sale
in the first 6 months of 2004. Our obligation to produce as requested shifted
revenue backwards into 2003 from 2004 first half. Finally, acquisition of the
assets of Donlar Corp (renamed NanoChem Solutions Inc.) was not complete until
June 9th and therefore only a small portion of the sales for the quarter and
half were consolidated with those of Flexible Solutions.

Operating expenses for the Company were $1,233,484 for the six months ended June
30th 2004 up from $974,107 for the six months ended June 30th 2003. The increase
in operating expense is a result of increased depreciation, advertising,
consulting fees, investor relations, research and development and expansion of
sales and marketing for commercial pool products and water conservation
products.

The net loss for the six months ended June 30th 2004 was $578,150compared to a
net loss of $49,295 for the six months ended June 30th 2003 The loss was due to
reduced sales in the Watersavr and swimming pool divisions combined with the
reduced interest income resulting from using capital to purchase assets and the
large increase in depreciation resulting from substituting depreciable assets
for cash. Cost of goods sold decreased to 39.7% from 56.4% as our pool products
factory increased efficiency and our price per unit rose. The loss per share was
$0.05 for the six-month period ended June 30th 2004 compared to $0.00 for the
six-month period ended June 30th 2003.
]
LIQUIDITY AND CAPITAL RESOURCES

As of June 30th 2004 the Company had working capital of $297,772, which
represented a decrease of $5,464,907 as compared to the working capital of
December 31st 2003. The decrease was entirely related to the purchase of assets
from the bankruptcy estate of Donlar that closed on June 9th. We used $3,000,000
in cash from our working capital and signed a promissory note for a further
$3,150,000 that is set against current assets because it has a term of less than
one year as of this report. The note is due June 9th 2005.

The Company has no external sources of liquidity in the form of credit lines
from banks.

Management believes that its available cash will be sufficient to fund the
Company's working capital requirements through December 31st 2004. Management
further believes that available cash will be sufficient to implement the
Company's expansion plans. No investment banking agreements are in place and
there is no guarantee that the Company will be able to raise capital in the
future should that become necessary.


                                      -12-
<PAGE>
ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKS:

The Company does not have any derivative financial instruments as of June 30th
2004. However, the Company is exposed to interest rate risk.

The Company's interest income and expense are most sensitive to changes in the
general level of U.S. and Canadian interest rates. In this regard, changes in
U.S. and Canadian interest rates affect the interest paid on the Company's cash
equivalents as well as the interest paid on debt.

FOREIGN CURRENCY RISK

The Company operates in both the United States and Canada. Therefore, the
Company's business and financial condition is sensitive to currency exchange
rates or any other restriction imposed on its currency.


                           PART II - OTHER INFORMATION

         ITEM 1.  Legal proceedings - On July 27th 2004, Sunsolar Energy
                  Technologies of St. Laurent, Quebec filed suit in the Federal
                  Court of Canada against Flexible Solutions Ltd., Flexible
                  Solutions International Inc., and Daniel O'Brien alleging
                  trademark infringement and seeking up to $7,000,000 Canadian
                  in damages and costs. The Company considers the complaint
                  frivolous, has filed a statement of defense, is considering a
                  countersuit and will defend itself vigorously.

         ITEM 2.  Changes in Securities -12,000 common shares were issued during
                  the quarter.
         ITEM 3.  Default upon Senior Securities - None
         ITEM 4.  Submission of Matters to a Vote of Securities Holders - On May
                  26th the annual general meeting of shareholders was held in
                  Victoria BC. The results are as follows.
                  -    Mr. Dan O'Brien, Mr. Robert O'Brien, Ms. Dale Friend, Mr.
                       John Bientjes and Mr. Eric Hodges were confirmed as
                       directors for the following year.
                  -    Cinnamon Jang Willoughby were confirmed as Auditor for
                       the year ending Dec 31 2004
                  -    Stock option compensation to directors and insiders was
                       approved
         Item 5.  Other Information - None
         Item 6.(a)        Exhibits
                  31   Certifications Pursuant to Section 302 of the Sarbanes-
                       Oxley Act of 2002
                  32   Certifications Pursuant to Section 906 of the Sarbanes-
                       Oxley Act of 2002

         Item 6.(b)        Reports on Form 8-K - July 26th 2004, June 1st 2004,
                       May 18th 2004, May 18th 2004


                                    SIGNATURES

         Pursuant to the requirements of the Securities Exchange Act of 1934,
         the registrant has duly caused this report to be signed on its behalf
         by the undersigned, there unto duly authorized.

                                          FLEXIBLE SOLUTIONS INTERNATIONAL INC.
(Registrant)

Dated: August 13th 2004                   /s/ DAN O'BRIEN
       ----------------                   ----------------
                                          Dan O'Brien, President and Director


                                      -13-