Comtech Telecommunications Corp. Announces Results for Fiscal 2018 Second Quarter and Updates Its Fiscal 2018 Guidance

MELVILLE, N.Y. –
March 7, 2018– Comtech Telecommunications Corp. (NASDAQ: CMTL) today
reported its operating results for the second fiscal quarter ended
January 31, 2018 and updated its fiscal 2018 guidance.

Fiscal 2018 Second Quarter Highlights

  • Net sales were $133.7 million.
  • Bookings were $210.6 million, with a book-to-bill ratio (a measure
    defined as bookings divided by net sales) of 1.57.
  • Backlog was $567.3 million, which is close to Comtech’s record high.
    Comtech’s backlog does not include the unfunded portions of multi-year
    contracts. As such, the total value of multi-year contracts that
    Comtech has received is substantially higher.
  • Comtech received several strategic contract awards including: (i) a
    $134.0 million award to provide one of the largest wireless carriers
    in the U.S. with enhanced 911 services; (ii) a $123.6 million contract
    to be the sole provider of sustainment support services for the U.S.
    Army’s “SNAP” mobile satellite communications program; and (iii) an
    initial $11.7 million order to provide several thousand of Comtech’s
    next generation MT-2025 mobile satellite transceivers to support the
    U.S. Army’s Blue Force Tracking-2 (“BFT-2”) system.
  • GAAP operating income was $4.9 million and GAAP net income was $15.8
    million, or $0.66 per diluted share.
  • GAAP net income includes a net tax benefit of $14.0 million, or $0.59
    per diluted share (“Tax Gain”), primarily due to the remeasurement of
    deferred tax assets and liabilities as a result of Tax Reform, which
    also resulted in a reduction to Comtech’s fiscal 2018 estimated
    effective tax rate to approximately 27.75%. Excluding the $0.59 per
    diluted share Tax Gain, GAAP net income would have been approximately
    $1.8 million, or $0.07 per diluted share.
  • Adjusted EBITDA was $14.5 million. Adjusted EBITDA is a non-GAAP
    financial measure which is reconciled to the most directly comparable
    GAAP financial measure and is more fully defined in the below table.
  • Cash flows from operating activities were $2.7 million.
  • Cash dividends of $2.4 million were paid to common stockholders.
  • $40.5 million of cash and cash equivalents as of January 31, 2018.

In commenting on Comtech’s performance during the second quarter of
fiscal 2018 and Comtech’s fiscal 2018 guidance, Fred Kornberg, President
and Chief Executive Officer, stated, “I could not be more pleased with
our better than expected second quarter results and the major multi-year
contract awards that we have received to-date. Business momentum remains
strong and shows no signs of slowing down. Given our year-to-date
performance and strong positive business momentum, we are increasing our
2018 fiscal year financial targets and expect that fiscal 2018 will be a
very strong year.”

Updated 2018 Fiscal Year Financial Targets

  • Comtech is increasing its revenue target to a new range of
    approximately $570.0 million to $585.0 million, as compared to a prior
    range of $550.0 million to $575.0 million. Despite the absence of $6.7
    million of BFT-1 intellectual property license fees that Comtech
    earned in fiscal 2017 supporting the U.S. Army’s Blue Force Tracking
    Program, the mid-point of Comtech’s new fiscal 2018 revenue target
    range represents a year-over-year growth rate of close to 5.0%.
  • Comtech is increasing its Adjusted EBITDA target to a new range of
    $72.0 million to $76.0 million, as compared to a prior range of $69.0
    million to $73.0 million. Despite the absence of the $6.7 million of
    BFT-1 intellectual property license fees, the mid-point of the new
    fiscal 2018 Adjusted EBITDA target range represents a year-over-year
    growth rate of close to 5.0%.
  • Comtech’s third quarter consolidated net sales and Adjusted EBITDA are
    expected to be higher than the related amounts achieved in its second
    quarter of fiscal 2018 by approximately 10.0%. Comtech’s consolidated
    GAAP operating income and Adjusted EBITDA, as a percentage of its
    consolidated third quarter fiscal 2018 net sales, are expected to
    approximate 4.0% and 11.0%, respectively, with significant increases
    in each metric in the fourth quarter of fiscal 2018.
  • Comtech is increasing its GAAP diluted EPS target to a new range of
    $1.08 to $1.23, as compared to a prior range of $0.44 to $0.46. This
    new target range includes the benefits of the $0.59 per diluted share
    Tax Gain and better than expected operating performance, partially
    offset by an increase in expected amortization of stock-based
    compensation. GAAP diluted EPS for Comtech’s third quarter of fiscal
    2018 is expected to approximate a range of $0.10 to $0.12 per diluted
    share, which is higher than the $0.07 per diluted share Comtech
    achieved in its second quarter of fiscal 2018 when excluding the $0.59
    per diluted share Tax Gain.
  • In line with its original Business Outlook for Fiscal 2018, Comtech’s
    fourth quarter of fiscal 2018 is expected to be the peak quarter – by
    far – for consolidated net sales, GAAP operating income and Adjusted
    EBITDA.
  • Comtech’s new estimated effective tax rate of 27.75% reflects seven
    months of benefit related to Tax Reform. Although Comtech continues to
    perform an analysis of Tax Reform and its impact, Comtech’s initial
    assessment is that its effective tax rate in fiscal 2019, before any
    discrete items, will range from 24.5% to 26.0%.
  • If order flow remains strong and Comtech is able to achieve all of its
    fiscal 2018 business goals, it is possible that Comtech’s actual
    fiscal 2018 consolidated net sales, GAAP diluted EPS and Adjusted
    EBITDA could be higher than its targeted amounts.

Additional information about Comtech’s fiscal 2018 guidance is included
in Comtech’s second quarter investor presentation which is located on
Comtech’s website at www.comtechtel.com.

Conferenza telefonica

Comtech has scheduled an investor conference call for 8:30 AM (ET) on
Thursday, March 8, 2018. Investors and the public are invited to access
a live webcast of the conference call from the Investor Relations
section of the Comtech website at www.comtechtel.com.
Alternatively, investors can access the conference call by dialing (888)
632-3389 (domestic), or (785) 424-1673 (international) and using the
conference I.D. “Comtech.” A replay of the conference call will be
available for seven days by dialing (800) 839-2383 or (402) 220-7202. In
addition, an updated investor presentation, including earnings guidance,
is available on Comtech’s website.

Informazioni su Comtech

Comtech Telecommunications Corp. progetta, sviluppa, produce e commercializza
prodotti, sistemi e servizi innovativi per soluzioni di comunicazione
avanzate. Comtech vende prodotti a una base di clienti diversificata nei mercati delle comunicazioni
mercati globali delle comunicazioni commerciali e governative.

Dichiarazione di cautela in merito alle dichiarazioni previsionali

Certain information in this press release contains forward-looking
statements, including but not limited to, information relating to the
Company’s future performance and financial condition, plans and
objectives of the Company’s management and the Company’s assumptions
regarding such future performance, financial condition, and plans and
objectives that involve certain significant known and unknown risks and
uncertainties and other factors not under the Company’s control which
may cause its actual results, future performance and financial
condition, and achievement of plans and objectives of the Company’s
management to be materially different from the results, performance or
other expectations implied by these forward-looking statements. These
factors include, among other things: the risk that the Company will be
unsuccessful in implementing a tactical shift in its Government
Solutions segment away from bidding on large commodity service contracts
and toward pursuing contracts for its niche products with higher
margins; the nature and timing of receipt of, and the Company’s
performance on, new or existing orders that can cause significant
fluctuations in net sales and operating results; the timing and funding
of government contracts; adjustments to gross profits on long-term
contracts; risks associated with international sales; rapid
technological change; evolving industry standards; new product
announcements and enhancements, including the risks associated with the
Company’s recent launch of Heights™ Dynamic Network Access Technology
(“HEIGHTS” or “HDNA”); changing customer demands; changes in prevailing
economic and political conditions; changes in the price of oil in global
markets; changes in foreign currency exchange rates; risks associated
with the Company’s and TeleCommunication Systems, Inc.’s (“TCS”) legacy
legal proceedings, customer claims for indemnification and other similar
matters; risks associated with the Company’s obligations under its
Secured Credit Facility, as amended; risks associated with the Company’s
large contracts; the impact of H.R.1, also known as the Tax Cuts and
Jobs Act (“Tax Reform”), which was recently enacted in the U.S.; and
other factors described in this and the Company’s other filings with the
Securities and Exchange Commission.

COMTECH TELECOMMUNICATIONS CORP.

E FILIALI

Bilancio consolidato sintetico

(Non certificato)

Three months ended January 31, Six months ended January 31,
2018 2017 2018 2017
Vendite nette $ 133,731,000 139,028,000

255,300,000 274,814,000
Costo del venduto 82,930,000 85,824,000 156,783,000 169,502,000
Utile lordo 50,801,000 53,204,000 98,517,000 105,312,000
Spese:
Vendite, spese generali e amministrative 27,215,000 30,988,000 55,690,000 63,673,000
Ricerca e sviluppo 13,435,000 13,314,000 27,185,000 27,410,000
Ammortamento delle attività immateriali 5,268,000 6,032,000 10,537,000 12,087,000
Risoluzione di controversie in materia di proprietà intellettuale - (9,979,000 ) - (9,979,000 )
45,918,000 40,355,000 93,412,000 93,191,000
Utile operativo 4,883,000 12,849,000 5,105,000 12,121,000
Altri costi (proventi):
Interessi passivi 2,519,000 2,852,000 5,107,000 6,177,000
Interessi (proventi) e altri (48,000 ) (74,000 ) (9,000 ) (76,000 )
Income before (benefit from) provision for income taxes 2,412,000 10,071,000 7,000 6,020,000
(Beneficio da) accantonamento per imposte sul reddito (13,349,000 ) 3,486,000 (14,094,000 ) 1,924,000
Utile netto $ 15,761,000 6,585,000

14,101,000 4,096,000
Utile netto per azione:
Base $ 0.66 0.28

0.59 0.17
Diluito $ 0.66 0.28

0.59 0.17
Numero medio ponderato di azioni ordinarie in circolazione - base 23,816,000 23,428,000 23,805,000 23,406,000
Numero medio ponderato di azioni ordinarie ed equivalenti ad azioni ordinarie
in circolazione - diluito
23,953,000 23,445,000 23,942,000 23,427,000
Dividendi dichiarati per ogni azione ordinaria emessa e in circolazione alla
data di registrazione dei dividendi
$ 0.10 0.10

0.20

0.40

COMTECH TELECOMMUNICATIONS CORP.

E FILIALI

Bilancio consolidato sintetico

January 31, 2018 31 luglio 2017
(Non certificato) (certificato)
Attività

Attività correnti:
Liquidità ed equivalenti di cassa $ 40,472,000 41,844,000
Crediti, netti 117,973,000 124,962,000
Rimanenze, nette 71,707,000 60,603,000
Risconti attivi e altre attività correnti 14,915,000 13,635,000
Totale attività correnti 245,067,000 241,044,000
Immobili, impianti e attrezzature, netti 30,122,000 32,847,000
Avviamento 290,633,000 290,633,000
Attività immateriali a vita definita, nette 251,334,000 261,871,000
Costi di finanziamento differiti, netti 2,635,000 3,065,000
Altre attività, nette 2,860,000 2,603,000
Totale attività $ 822,651,000 832,063,000
Passivo e patrimonio netto
Passività correnti:
Debiti $ 27,662,000 29,402,000
Ratei passivi e altre passività correnti 60,585,000 68,610,000
Dividendi da pagare 2,351,000 2,343,000
Anticipi e depositi dei clienti 24,848,000 25,771,000
Quota corrente del debito a lungo termine 17,211,000 15,494,000
Parte corrente degli obblighi di leasing di capitale 1,858,000 2,309,000
Interessi passivi 83,000 282,000
Totale passività correnti 134,598,000 144,211,000
Quota non corrente del debito a lungo termine, netto 174,225,000 176,228,000
Quota non corrente degli obblighi di leasing di capitale 885,000 1,771,000
Imposte sul reddito da pagare 2,558,000 2,515,000
Passività fiscali differite, nette 6,088,000 17,306,000
Anticipi e depositi di clienti, non correnti 8,385,000 7,227,000
Altre passività 5,291,000 2,655,000
Totale passività 332,030,000 351,913,000
Impegni e imprevisti
Patrimonio netto:
Azioni privilegiate, valore nominale di $.10 per azione; azioni autorizzate e
non emesse 2.000.000
- -
Common stock, par value $.10 per share; authorized 100,000,000
shares; issued 38,653,430 shares and 38,619,467 shares at January
31, 2018 and July 31, 2017, respectively
3,865,000 3,862,000
Riserva di capitale versato 534,224,000 533,001,000
Utili a nuovo 394,381,000 385,136,000
932,470,000 921,999,000
Meno:

Treasury stock, at cost (15,033,317 shares at January 31, 2018

and July 31, 2017)

(441,849,000 ) (441,849,000 )
Totale patrimonio netto 490,621,000 480,150,000
Totale passività e patrimonio netto $ 822,651,000 832,063,000

COMTECH TELECOMMUNICATIONS CORP.

E FILIALI

Riconciliazione delle misure finanziarie non-GAAP con le misure finanziarie GAAP
GAAP
(Non certificato)

Uso di misure finanziarie non-GAAP

Al fine di fornire agli investitori ulteriori informazioni sui risultati finanziari, il presente comunicato stampa contiene i "dati finanziari non-GAAP".
risultati finanziari, il presente comunicato stampa contiene "misure finanziarie non-GAAP
non-GAAP" ai sensi delle norme della SEC. L'EBITDA rettificato della Società è una misura
Non-GAAP che rappresenta l'utile (perdita) prima delle imposte sul reddito,
interessi (reddito) e altre spese, interessi passivi, ammortamento di
di compensazione a base azionaria, ammortamento di beni immateriali, ammortamento
svalutazione, risoluzione di controversie in materia di proprietà intellettuale, spese per piani di acquisizione o per l'analisi di alternative strategiche.
di acquisizione o di analisi di alternative strategiche e altre spese. La definizione di
La definizione di EBITDA rettificato della Società può differire da quella utilizzata da altre società.
di EBITDA utilizzata da altre società e pertanto potrebbe non essere paragonabile a
misure con titolo simile utilizzate da altre società. L'EBITDA rettificato è
è anche un parametro spesso richiesto dagli investitori e dagli analisti della Società.
analisti della Società. L'azienda ritiene che gli investitori e gli analisti possano utilizzare
l'EBITDA rettificato, insieme ad altre informazioni contenute nella documentazione SEC
nella valutazione delle prestazioni della Società e della comparabilità dei suoi risultati con quelli di altre società.
risultati della Società con quelli di altre società. Queste misure finanziarie Non-GAAP hanno
come strumento analitico, in quanto non tengono conto dell'impatto finanziario delle
delle transazioni necessarie per la conduzione dell'attività della Società, come ad esempio la
concessione di premi di compensazione azionaria, e non sono da intendersi come un'alternativa alle misure
alternativa alle misure finanziarie preparate in conformità ai GAAP.
Tali misure sono rettificate come descritto nella riconciliazione tra GAAP e Non-GAAP riportata di seguito.
GAAP a Non-GAAP nella tabella sottostante, ma tali rettifiche non devono essere
non devono essere interpretate come un'affermazione che tutti questi aggiustamenti o costi siano
insoliti, infrequenti o non ricorrenti. Le misure finanziarie Non-GAAP devono
essere considerati in aggiunta, e non come sostitutivi o superiori a
alle misure finanziarie determinate in conformità ai GAAP. Si consiglia agli investitori di
si consiglia agli investitori di esaminare attentamente i risultati finanziari GAAP che sono
divulgati nei documenti SEC della Società. La Società non ha
quantitativamente l'obiettivo dell'EBITDA rettificato per l'anno fiscale 2018 alla misura GAAP più
misura GAAP più direttamente comparabile, in quanto voci come i compensi basati su azioni, gli
come i compensi basati sulle azioni, le rettifiche all'accantonamento per le imposte sul reddito,
ammortamento di beni immateriali e interessi passivi, che sono voci specifiche che incidono su queste misure, non hanno
che incidono su queste misure, non si sono ancora verificati, sono fuori dal controllo della Società o non possono essere
controllo della Società o non possono essere previsti. Ad esempio, la quantificazione
delle spese per compensi basati su azioni richiede input quali il numero di azioni concesse e il prezzo di mercato
numero di azioni concesse e il prezzo di mercato che non sono attualmente accertabili.
Di conseguenza, le riconciliazioni con le metriche previsionali Non-GAAP non sono disponibili senza uno sforzo eccessivo.
non sono disponibili senza uno sforzo irragionevole e tali voci di riconciliazione non disponibili potrebbero
elementi di riconciliazione potrebbero avere un impatto significativo sui risultati finanziari della Società.
risultati finanziari della Società.

Three months ended January 31, Six months ended January 31, Anno fiscale
2018 2017 2018 2017 2017
Riconciliazione dell'utile netto GAAP con l'EBITDA rettificato:
Utile netto $ 15,761,000 6,585,000 14,101,000 4,096,000 $ 15,827,000
(Beneficio da) accantonamento per imposte sul reddito (13,349,000 ) 3,486,000 (14,094,000 ) 1,924,000 9,654,000
Interessi (proventi) e altri costi (48,000 ) (74,000 ) (9,000 ) (76,000 ) (68,000 )
Interessi passivi 2,519,000 2,852,000 5,107,000 6,177,000 11,629,000
Ammortamento dei compensi basati su azioni 1,080,000 1,019,000 1,827,000 1,989,000 8,506,000
Ammortamento delle attività immateriali 5,268,000 6,032,000 10,537,000 12,087,000 22,823,000
Ammortamento 3,317,000 3,568,000 6,663,000 7,317,000 14,354,000
Risoluzione di controversie in materia di proprietà intellettuale - (9,979,000 ) - (9,979,000 ) (12,020,000 )
EBITDA rettificato $ 14,548,000 13,489,000 24,132,000 23,535,000 $ 70,705,000

ECMTL

Media:
Michael D. Porcellana, Vicepresidente Senior e Direttore Finanziario
Direttore finanziario
(631) 962-7103
[email protected]

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