Velan (VLN) Q3 2026 earnings summary

Executive summary

• Q3 2026 sales were CAD 71.7 million, with adjusted EBITDA of CAD 9.5 million, driven by high-margin projects and disciplined cost management.

• Backlog increased 8% since the fiscal year start to CAD 296.8 million, with 80.4% deliverable within 12 months.

• Bookings grew 32% year-over-year to CAD 77.9 million, led by strong performance in nuclear and oil & gas sectors, especially in North America.

• Most rescheduled orders from the previous quarter were recaptured, though some remain deferred.

• A major contract was secured with Ontario Power Generation for over CAD 20 million, reinforcing leadership in the nuclear sector.

Financial highlights

• Q3 sales were CAD 71.7 million, down 2.4% year-over-year, mainly due to lower Italian shipments and order timing.

• Gross profit was CAD 27.2 million (37.9% margin), stable versus last year.

• Adjusted EBITDA was CAD 9.5 million, down from CAD 14.3 million last year, reflecting lower gross profit and higher other expenses.

• Adjusted net income for Q3 was CAD 4 million, down from CAD 8.5 million last year.

• Cash flow from operations used CAD 6.7 million, mainly due to working capital changes.

Outlook and guidance

• Management expects normalization of customer delivery schedules to improve cash inflows.

• Strong backlog and bookings, especially in nuclear and oil & gas, support a positive outlook.

• No immediate changes to management or strategy are expected before transaction closing; post-closing plans may be shared.

• 80.4% of backlog is expected to be delivered in the next 12 months.

• Management anticipates another solid performance for fiscal 2026, despite tariff uncertainties.