Q2 2025 Velan Inc Earnings Call Transcript
Key Points
- Velan Inc (VLNSF) reported a significant improvement in net income, achieving $100,000 compared to a loss of $2.1 million a year ago.
- The company experienced a 60% increase in bookings and a 20% rise in sales year-over-year, driven by strong performance in sectors like nuclear power, defense, and oil and gas.
- Cash flow from operations improved significantly, reaching $10.1 million in the quarter and $15 million for the first half of the fiscal year.
- Velan Inc (VLNSF) secured a main services agreement with GDH SMR Technologies Canada Limited, positioning itself as a first-mover in supplying small modular reactors (SMRs) with proprietary valve technology.
- The company's order backlog increased by 11.5% to $548 million, with 72% of the backlog expected to be delivered within the next 12 months, indicating strong future sales potential.
- Despite the positive financial performance, Velan Inc (VLNSF) faced a $5.2 million nonrecurring revenue gain related to a canceled agreement, which did not contribute to gross profit.
- Currency movements negatively impacted sales by $0.6 million during the quarter.
- The company's gross profit margin decreased to 27% from 29.1% last year, partly due to higher inventory provisions.
- Administration costs increased to $24.8 million, driven by higher sales commissions, which could impact future profitability.
- The company faces potential logistical risks and supply chain disruptions due to geopolitical tensions in regions like the Middle East.
Good morning. My name is Joelle, and I will be your conference operator today. At this time, I would like to welcome everyone to the conference call. (Operator Instructions)
Mr. Rishi Sharma, Chief Financial Officer, you may now begin your conference.
Thank you, operator. Good morning, and thank you for joining us for our conference call. Let's start by discussing the disclaimer from our related IR presentation, which is available on our website in the Investor Relations section. As usual, the first section mentions that the presentation provides an analysis of our consolidated results for the second quarter ended August 31, 2024. The Board of Directors approved these results yesterday, October 10, 2024.
Second paragraph refers to non-IFRS and supplementary financial measures defined and reconciled at the end of the presentation. The last paragraph refers to forward-looking information, which are subject to risks and uncertainties that are not guaranteed to occur. Forward
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