MONTREAL, Quebec — January 14, 2026 — Leads & Copy — Velan Inc. (TSX: VLN) has announced its financial results for the third quarter, which ended Nov. 30, 2025.
The world-leading manufacturer of industrial valves reported sales of $71.7 million, compared to $73.4 million last year. Gross profit reached $27.2 million, representing 37.9% of sales, slightly lower than the previous year’s $28.3 million, or 38.6% of sales.
Operating income amounted to $5.9 million, a significant improvement from the operating loss of $62.4 million a year ago. Net income totaled $3.0 million, or $0.14 per share, a stark contrast to the net loss of $47.8 million, or $2.22 per share, in the prior year.
The company maintains a solid financial position, with access to approximately $86 million in total liquidity and a net cash position of $20.2 million as of Nov. 30, 2025. Backlog increased to $296.8 million, up 8.0% since the beginning of the fiscal year. Bookings reached $77.9 million, compared to $59.1 million last year.
Adjusted net income was $4.0 million, versus adjusted net income of $8.5 million last year. Adjusted EBITDA totaled $9.5 million, compared to $14.3 million last year.
For the nine-month period, sales reached $211.5 million, nearly identical to the $212.0 million reported for the same period last year. Gross profit was $63.5 million, or 30.0% of sales, compared to $65.1 million, or 30.7% of sales, in the previous year.
Operating income was $2.4 million, compared to an operating loss of $64.4 million a year ago. Net income amounted to $19.2 million, or $0.89 per share, a significant improvement from the net loss of $51.2 million, or $2.37 per share last year. Net income, including discontinued operations, was $77.8 million, compared to a net loss of $63.1 million for the same period last year.
Bookings totaled $221.3 million, compared to $230.5 million last year. Adjusted net income was $2.9 million, versus adjusted net income of $11.5 million last year. Adjusted EBITDA was $16.7 million, compared to $23.9 million last year.
According to James A. Mannebach, Chairman of the Board and CEO of Velan, the company delivered solid performance, driven by the execution of high-margin projects and a tight management of operating expenses. The backlog sustained its momentum, reaching $296.8 million at the end of the quarter, driven by bookings rising nearly 32% year over year during the period. This improvement includes an important contract of more than $20 million CAD from Ontario Power Generation for three reactors being refurbished at the Pickering Nuclear Generation Station.
Looking ahead, the recently proposed sale of the Velan family’s majority share ownership in the Company to Birch Hill Equity Partners Management Inc. should provide a dynamic, results-oriented environment conducive to leveraging the company’s strengths.
Rishi Sharma, Chief Financial and Administrative Officer of VeIan, said that higher late-stage, work-in-process inventory raised working capital requirements for a second consecutive quarter. Nevertheless, the balance sheet remains strong with a positive net cash position, $86 million in liquidities available to invest in expansion opportunities, and expected cash inflows as working capital normalizes.
As at Nov. 30, 2025, the backlog from continuing operations stood at $296.8 million, up $21.9 million, or 8.0%, from $274.9 million at the beginning of the fiscal year. As at Nov. 30, 2025, 80.4% of the backlog, representing orders of $238.5 million, is deliverable in the next 12 months, versus 83.4% of last year’s backlog.
Bookings from continuing operations amounted to $77.9 million in the third quarter of fiscal 2026, compared to $59.1 million a year ago. In the first nine months of fiscal 2026, bookings from continuing operations totaled $221.3 million, compared to $230.5 million in the first nine months of fiscal 2025.
Sales from continuing operations totaled $71.7 million, a decrease of $1.7 million or 2.4% compared to $73.4 million for the same period last year. Gross profit from continuing operations was $27.2 million, versus $28.3 million last year. As a percentage of sales, gross profit remained relatively steady, reaching 37.9% compared to 38.6% last year.
Administration costs from continuing operations amounted to $16.5 million, or 23.0% of sales, compared to $17.0 million, or 23.2% of sales, last year. The Company incurred restructuring expenses of $1.3 million consisting of transaction-related costs.
Adjusted EBITDA from continuing operations, excluding non-recurring elements, was $9.5 million, versus $14.3 million in the third quarter of fiscal 2025. Net income from continuing operations was $3.0 million, or $0.14 per share, compared to a net loss of $47.8 million, or a loss of $2.22 per share, a year earlier.
Sales from continuing operations amounted to $211.5 million, a decrease of $0.5 million, or 0.2%, compared to $212.0 million for the nine-month period ended Nov. 30, 2025. Gross profit from continuing operations was $63.5 million, compared to $65.1 million last year. As a percentage of sales, gross profit was 30.0%, compared to 30.7% last year.
Administration costs from continuing operations were $50.1 million, or 23.7% of sales, compared to $48.3 million, or 22.8% of sales, in the nine-month period ended Nov. 30, 2024. The Company incurred restructuring expenses of $7.4 million, including $8.1 million in transaction-related costs, partially offset by a $0.8 million reversal of asbestos-related costs.
Adjusted EBITDA from continuing operations, excluding non-recurring elements, was $16.7 million, versus $23.9 million in the first nine months of fiscal 2025. Net income from continuing operations was $19.2 million, or $0.89 per share, compared to a net loss of $51.2 million, or a loss of $2.37 per share, in the prior year.
As at Nov. 30, 2025, the company held cash and cash equivalents of $36.3 million and short-term investments of $0.4 million. Bank indebtedness stood at $16.1 million, while long-term debt, including the current portion, amounted to $17.7 million.
As at Nov. 30, 2025, orders amounting to $238.5 million, representing 80.4% of a total backlog of $296.8 million, are expected to be delivered in the next 12 months. On Jan. 14, 2026, the Company announced that its controlling shareholder, Velan Holding Co. Ltd., has agreed to sell its 15,566,567 multiple voting shares and one subordinate voting share to funds managed by Birch Hill Equity Partners Management Inc., at a price of C$13.10 per share.
The VH Transaction is expected to close in the first half of 2026, subject to the receipt of the required regulatory approvals and other customary closing conditions.
The company estimates that transaction related fees will be approximately $12 million, as well as additional change of control triggered costs of approximately $5 million relating mostly to the vesting and accelerated vesting of various incentive plans already in place at the time of the transaction.
Under the terms of the Cooperation Agreement, the Company has agreed to suspend the declaration of dividend payments until closing, with ordinary course dividends currently planned to resume thereafter, as, if and when declared by the Board.
On March 31, 2025, the Company announced the closing sale of its French subsidiaries Velan S.A.S. and Segault S.A.S. for a total consideration of $208.2 million (€192.5 million) and net consideration of $183.1 million.
Financial analysts, shareholders, and other interested individuals are invited to attend the third quarter conference call to be held on Thursday, January 15, 2026, at 8:00 a.m. (EST). The toll-free call-in number is 1-800-990-4777 or by RapidConnect URL: https://emportal.ink/4awUyQ3.
Founded in Montreal in 1950, Velan Inc. is one of the world’s leading manufacturers of industrial valves. The Company employs 1,283 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.
Contact:
Rishi Sharma, Chief Financial and Administrative Officer
Martin Goulet, M.Sc., CFA
Velan Inc.
MBC Capital Markets Advisors
Tel: (438) 817-4430
Tel.: (514) 731-0000, ext. 229
Source: Velan Inc.
