18.6% sales growth and higher gross profit margin  Net income from continuing operations of $17.8 million, consolidated net income including closing of the transactions of $77.2 million Strong financial position with available cash on hand of $59.1 million, highest in five years Significant increase in quarterly dividend payment to CA$0.10 per common share MONTREAL, July 10, 2025 (GLOBE NEWSWIRE) -- Velan Inc. (TSX: VLN) (“Velan” or the “Company”), a world-leading manufacturer of industrial valves, announce ...

Core Insights - Velan Inc. reported a strong financial performance for the first quarter of fiscal 2026, with significant sales growth and improved gross profit margins [3][4][5] Financial Performance - Sales from continuing operations reached $72.2 million, an increase of $11.3 million or 18.6% compared to $60.9 million in the same period last year [5][11] - Gross profit rose to $20.6 million, representing a gross margin of 28.6%, up from 27.6% in the previous year [5][12] - Net income from continuing operations was $17.8 million, or $0.83 per share, compared to a net loss of $2.2 million, or a loss of $0.10 per share, in the prior year [5][16] Cash Position and Dividends - The company ended the quarter with cash and cash equivalents of $59.1 million, the highest level in five years, following the divestiture of asbestos-related liabilities and the sale of French assets [3][4][18] - A significant increase in the quarterly dividend payment was approved, raising it from CA$0.03 to CA$0.10 per common share, reflecting confidence in future performance [20][21] Backlog and Bookings - The backlog stood at $286.1 million, up 4.1% from $274.9 million at the end of the previous quarter, with 84.4% expected to be delivered within the next 12 months [9][19] - Bookings for the quarter amounted to $78.2 million, down from $83.0 million in the previous year, resulting in a book-to-bill ratio of 1.08 [10][19] Significant Transactions - The company completed the sale of its French subsidiaries for a total consideration of $208.2 million, resulting in a gain of $95.8 million recorded in the first quarter [7][8] - Concurrently, Velan sold its exposure to asbestos-related litigation in the U.S. for $143.0 million [8]

Core Insights - Velan Inc. reported significant improvements in bookings, sales, gross profit, and cash flow generation for fiscal year 2025, achieving a sales growth of 14.1% from continuing operations [2][6][16] - The company declared a dividend of CA$0.33 per share, which includes a special dividend of CA$0.30, reflecting its commitment to return funds to shareholders [1][33] Financial Performance - Sales for fiscal 2025 reached $295.2 million, an increase of $36.5 million or 14.1% compared to the previous year [6][16] - Gross profit improved significantly to $84.9 million, representing 28.8% of sales, up from $54.6 million or 21.1% of sales in the prior year [6][17] - Adjusted net income was $6.6 million, or $0.31 per share, compared to an adjusted net loss of $15.7 million, or a loss of $0.73 per share in fiscal 2024 [22] - Adjusted EBITDA rose to $27.5 million from $2.1 million in the previous year, driven by higher sales and gross profit [20][22] Cash Flow and Financial Position - The company ended fiscal 2025 with a net cash position of $32.4 million and cash and cash equivalents of $34.9 million, which is expected to increase to approximately $55.0 million following significant transactions [2][30] - Operating cash flows from continuing operations were $26.5 million, compared to $12.5 million in the previous year [6][30] Significant Transactions - Velan completed the divestiture of its asbestos-related liabilities and the sale of its French subsidiaries, which are expected to enhance liquidity and de-risk the balance sheet [8][9][10] - The asbestos-related liabilities were permanently removed from the balance sheet, and the sale of the French businesses generated a total consideration of $208.2 million [9][10] Backlog and Bookings - The backlog as of February 28, 2025, was $274.9 million, down 3.1% from $283.6 million a year earlier, with 82.1% of the backlog expected to be deliverable within the next 12 months [11][31] - Bookings for fiscal 2025 reached $292.5 million, an increase of 1.3% compared to the previous year, reflecting higher North American bookings in the nuclear sector [14][15] Outlook - The company anticipates continued strong performance in fiscal 2026, supported by a solid backlog and ongoing demand in clean energy markets, particularly nuclear energy [2][31]