MONTREAL, Jan. 12, 2022 (GLOBE NEWSWIRE) -- Velan Inc. (TSX: VLN) (the “Company”), a world-leading manufacturer of industrial valves, announced today its financial results for its third quarter ended November 30, 2021.
Highlights:
- Sales for the quarter amounted to $110.0 million, an increase of 38.4 million or 53.7% compared to the same quarter of the previous fiscal year. This quarter’s sales level represents the highest volume in the last seven quarters.
- Gross profit for the quarter of $35.9 million, or 32.6%, an increase of $13.8 million or 180 basis points from the same quarter of the previous year. The gross profit percentage of 30.5% for the first nine-month of the fiscal year is driven by an improved sales volume, a more profitable product mix, as well as the margin improvement activities undertaken over the past fiscal years within the scope of the V20 restructuring and transformation plan.
- Net income1 of $4.5 million and EBITDA2 of $13.3 million for the quarter. EBITDA2 is comparable to the same quarter last year which included a non-recurring gain of $9.6 million recognized on the disposal of one of the Company’s Montreal plants in the scope of the V20 transformation plan. The improved EBITDA2, when adjusted for the non-recurring gain, is explained primarily by an increased gross profit, driven by an improved sales volume and product mix, despite $2.7 million lower Canada Emergency Wage Subsidies («CEWS»).
- Strong order backlog2 of $543.0 million at the end of the quarter compared to $561.8 million at the end of the same quarter last year.
- Net new orders (“bookings”)2 of $88.4 million for the quarter, a decrease of $79.2 million or 47.3% compared to the same quarter of the previous fiscal year. The decrease for the quarter is primarily attributable to a generally lower level of bookings3 in the current quarter, coupled with large oil and gas and nuclear orders recorded in the third quarter of the previous year. The book-to-bill ratio2 for the nine-month period stands at an even 1.00.
- The Company’s net cash amounted to $65.8 million at the end of the quarter, a decrease of $2.3 million or 3.4% compared to the previous quarter of the current fiscal year. The Company used the cash primarily generated by its operations during the quarter to pay down $11.9 million of its revolving credit facility in order to reduce its overall debt load.
Bruno Carbonaro, CEO and President of Velan Inc., said, “I am very pleased to announce our strong results this quarter. Our quarterly sales of $110.0 million yielded a gross margin of 32.6% and brought our year-to-date sales to $286.4 million, which represents our highest sales volume since fiscal year 2016. The sales volume was achieved thanks to the delivery of large orders dedicated to the petrochemical and oil and gas markets by our North American and Italian operations. Our backlog2 remains high at $543.0 million, and our book-to-bill ratio2 remains at an even 1.00 when we consider the nine-month period.
On the Covid-19 front, we took the necessary measures in all our subsidiaries. The fifth wave is challenging for us, especially in Europe and North America, and we are taking all the necessary precautions to ensure our employees’ safety and wellbeing.
We are now shifting our focus to our fourth quarter, where we will continue to build on the momentum from the last two quarters.”
About Velan
Founded in Montreal in 1950, Velan Inc. (www.velan.com) is one of the world’s leading manufacturers of industrial valves, with sales of US$302.1 million in its last reported fiscal year. The Company employs close to 1,700 people and has manufacturing plants in 9 countries. Velan Inc. is a public company with its shares listed on the Toronto Stock Exchange under the symbol VLN.
https://www.globenewswire.com/news-release/2022/01/12/2365997/0/en/Velan-Inc-Reports-Its-Strong-Third-Quarter-2021-22-Financial-Results-Highlighted-by-a-Significant-Increase-in-Sales-and-Improved-Margins.html