Mitel (News - Alert) saw increased profits during the third quarter and revenues were up as well – with the good news attributed to the company’s performance in continuing operations. Based in Canada, Mitel provides unified communications and collaboration (UCC) software.

“We are pleased to have delivered revenue, gross margin and non-GAAP operating expenses that were in line with or better than guidance,” Richard McBee, Mitel CEO, said in a company statement.

The company is in the midst of streamlining – so it decided to sell the DataNet/CommSource business division. The sale has yet to take place. The Ottawa Citizen reported that DataNet “did not fit with Mitel's main business of designing and selling Internet phones” and it “was the least profitable within Mitel.”

“We remain focused on our core business where demand remains solid for our Mitel solutions and our broad suite of virtualized UC applications software,” McBee said.

During the quarter, Mitel saw total revenue of $164.4 million. That includes the discontinued DataNet/CommSource division. In December, Mitel predicted total revenue for the quarter to be between $164 million and $170 million.

On the other hand, revenue from continuing operations was $150.5 million, a 4.6 percent jump.

Revenues from Mitel Communications Solutions during the 3Q increased 7 percent to $127.2 million, compared to the same quarter during fiscal 2011. In addition, revenues from Mitel NetSolutions edged up 1 percent to $20.2 million during the 3Q, compared to the same quarter during fiscal 2011.

In the 3Q, ending on Jan. 31, Mitel achieved profits of $4.6 million, while a year ago in the same quarter it saw a drop of $4 million.

“We are pleased to have achieved strong MCS revenue growth, record gross margins, expanded earnings and robust cash flow in our third quarter,” Steve Spooner (News - Alert), Mitel’s chief financial officer. “Our focus in the fourth fiscal quarter will be to deliver continued improvement in our business performance.”

Mitel projects that revenues for the current quarter will be between $152 million and $157 million, when not including the business unit that was discontinued, according to The Wall Street Journal.

McBee also said that Mitel is not being offered for sale “and if anything, could be an acquirer.” In its sector, Mitel has been ranked third after Cisco Systems and Avaya (News - Alert) in the United States, Australia and Canada, according to news reports. Mitel is ranked second in Great Britain, news reports add.

In other recent news, Mitel was given a contract by the Public Works and Government Services Canada for Foreign Affairs and International Trade, TMCnet reported.