MONTREAL – Velan Inc. (TSX:VLN) credits increased margins, lower costs and favourable foreign currency conversions for an improvement in third-quarter profits despite lower revenue.
The Montreal-based industrial valve maker, which reports in U.S. dollars, said Thursday that net earnings improved to $8.3 million, or 38 cents a share, in the three months ended Nov. 30.
That was up from $5.7 million, or 26 cents per share, in the same year-earlier period even as revenue slipped to $115.6 million from $134.2 million.
Velan noted that the 13.9 per cent decrease in revenue compared with record sales in the 2012 quarter.
“We are pleased with the solid results for both the quarter and year to date,” chief financial officer John Ball said. “Both earnings and gross profit have improved over the previous year. The third quarter was also quite positive for both our cash position and working capital.”
CEO Tom Velan noted that while “bookings in the quarter continued to be lower than we would like, there has been a gradual strengthening over recent months and in December 2013 we had consolidated bookings of more than $50 million.”
“We have many outstanding opportunities in the marketplace and we are working on turning these opportunities into orders,” he added.
Shares in Velan, which reported after markets closed, were up 23 cents at $14.33 Thursday on the Toronto Stock Exchange.