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VELAN PRESS RELEASE FOR IMMEDIATE RELEASE July 13 , 2021 Velan Inc. 7007 Côte de Liesse , Montreal , QC H4T 1G2 Canada Tel : ( 514 ) 748-7743 Fax : ( 514 ) 748-8635 www.velan.com For further information please contact : Yves Leduc , Chief Executive Officer or Benoit Alain , Chief Financial Officer Tel : ( 514 ) 748-7743 Fax : ( 514 ) 748-8635 Web : www.velan.com VELAN INC . REPORTS ITS FIRST QUARTER 2021/22 FINANCIAL RESULTS MONTREAL , QUEBEC Velan Inc. ( TSX : VLN ) ( the " Company " ) , a world - leading manufacturer of industrial valves , announced today its financial results for its first quarter ended May 31 , 2021 . Highlights : Sales remained flat and results decreased due to higher administrative costs and other temporary factors , but the Company is encouraged by the notably improved margins of its global operations and its strengthening backlog . • • • Order backlog of US $ 607.2 million at the end of the quarter representing the highest backlog¹ for the Company since August 2012. The portion of the current backlog¹ deliverable in the next nine months is expected to be $ 323.1 million . Net new orders ( " bookings " ) 1 of $ 116.4 million for the quarter , an increase of $ 39.6 million or 51.7 % , which translated in a strong book - to - bill ratio¹ of 1.56 obtained primarily by the recording of significant orders in the marine , mining , and downstream oil and gas sectors . Sales for the quarter amounted to $ 74.5 million , a decrease of $ 2.1 million or 2.8 % compared to the same quarter of the previous fiscal year . Quarterly sales can vary greatly based on the timing of the delivery of large project orders which are expected to be greater in the latter part of fiscal 2022 ; in particular , the shipment of some important large project orders by the Company's Italian operations , originally planned for this quarter , have shifted into the second quarter . • Gross profit for the quarter of $ 20.0 million , an increase of $ 1.6 million or 280 basis points from the same quarter of the previous year driven by the margin improvement activities performed over the past fiscal years in the scope of the V20 restructuring and transformation plan . • • Net loss² of $ 5.1 million and negative EBITDA¹ of 0.9 $ million for the quarter primarily attributable to an increase in administration costs and lower Canadian federal subsidies ( « CEWS >> ) ; these are the main two factors that drive lower results in the quarter compared to the previous year despite notably improved margins at similar sales level . The Company's net cash amounted to $ 71.2 million at the end of the quarter , an increase of $ 8.3 million since the beginning of the fiscal year , highlighting the Company's healthy financial position . Velan . Quality that lasts .