Velan (VLN) Q2 2025 earnings summary

Executive summary

• Bookings rose to $116.6 million, up 63% year-over-year, and sales increased 22.8% to $98.7 million, driven by strong demand in nuclear power, defense, and oil & gas sectors.

• Net income improved to $0.1 million from a $2.1 million loss last year; cash flow from operations was $10.1 million for the quarter and $15 million for the first half.

• Achieved highest order backlog in three years at $548.1 million, with $395.9 million deliverable within 12 months.

• Secured major nuclear sector agreements, including a main services agreement with GEH SMR Technologies and a CAD 50 million, 10-year alliance with Bruce Power.

• Diversified product portfolio and global reach contributed to growth, with strong sectoral contributions.

Financial highlights

• Q2 sales totaled $98.7 million, up 22.8% year-over-year, with growth from Italy, France, and North America; included a $5.2 million non-recurring revenue gain from a canceled contract.

• Gross profit was $26.7 million (27% margin), up from $23.4 million last year; adjusted gross margin excluding non-recurring gain was 28.5%.

• EBITDA reached $5.1 million, up from $3.0 million last year; adjusted EBITDA was $5.1 million, up from $3.3 million.

• Cash and equivalents stood at $44.5 million, with short-term investments of $4.8 million and long-term debt of $22.6 million as of August 31, 2024.

• Book-to-bill ratio was 1.18 for the quarter and 1.29 for the first six months.

Outlook and guidance

• Maintains sales growth outlook for the fiscal year, supported by record backlog and strong bookings.

• Expects continued momentum in the second half, with $395.9 million of orders deliverable within 12 months.

• Gross margin expected to benefit from contract execution and fixed capacity, with admin costs stabilizing around current levels.