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

June 6, 2018– Comtech Telecommunications Corp. (NASDAQ: CMTL) today
reported its operating results for the third fiscal quarter ended
April 30, 2018 and updated its fiscal 2018 guidance.

Fiscal 2018 Third Quarter Highlights

  • Net sales were $147.9 million.
  • Bookings were $164.3 million, with a book-to-bill ratio (a measure
    defined as bookings divided by net sales) of 1.11.
  • Backlog increased from the level reported as of the second quarter of
    fiscal 2018 and is a near record $583.7 million. This amount does not
    include the portions of multi-year contracts that have not been
    funded. As such, the total value of multi-year contracts that Comtech
    has received is substantially higher.
  • Comtech received a number of strategic contracts and orders,
    including: (i) a $59.0 million contract to provide the U.S. Navy with
    SLM-5650B satellite modems, upgrade kits and related services; (ii)
    $16.9 million of orders to provide ongoing sustainment services for
    the U.S. Army’s “SNAP” mobile satellite communications program; (iii)
    $14.2 million of orders to supply the U.S. Army with advanced VSAT
    equipment; (iv) a $10.1 million multi-year contract to provide one of
    the largest wireless carriers in the U.S. with a hosted, advanced
    location services platform; (v) $8.5 million in contracts to supply
    Modular Transportable Transmission System troposcatter terminals to
    two international customers; and (vi) a $3.7 million contract
    modification from the Consortium Management Group to support the U.S.
    Army Project Manager Mission Command and the Blue Force Tracking-2
    (“BFT-2”) program to port additional waveforms onto the current BFT-2
  • GAAP operating income was $14.0 million and GAAP net income was $8.2
    million, or $0.34 per diluted share.
  • Adjusted EBITDA was $23.5 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 $21.4 million.
  • Cash dividends of $2.4 million were paid to common stockholders.
  • $44.2 million of cash and cash equivalents as of April 30, 2018.

In commenting on Comtech’s performance during the third quarter of
fiscal 2018 and Comtech’s updated fiscal 2018 guidance, Fred Kornberg,
President and Chief Executive Officer, stated, “Our results for the
third quarter exceeded our expectations and our pipeline of
opportunities remains strong. Based on our strong year-to-date
performance and positive business momentum, we are increasing our fiscal
2018 operating income and Adjusted EBITDA targets, and expect fiscal
2018 to be a successful year. As we begin to look to fiscal 2019, we
believe that we are firmly positioned for growth.”

Updated 2018 Fiscal Year Financial Targets

  • Comtech is maintaining its revenue target of approximately $570.0
    million to $585.0 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 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
    $73.5 million to $76.5 million, as compared to a prior range of $72.0
    million to $76.0 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 an annual growth
    rate of close to 6.0%. Adjusted EBITDA, as a percentage of net sales,
    is expected to be close to 13.0%.
  • From a timing perspective, Comtech’s fourth quarter of fiscal 2018 is
    still expected to be the peak quarter for both net sales and Adjusted
    EBITDA, but its third quarter of fiscal 2018 is now expected to be the
    peak quarter of operating income. Comtech’s operating income for the
    third quarter reflects the benefit of shipments of satellite earth
    station equipment to the U.S. Navy that were previously expected to
    occur in its fourth quarter of fiscal 2018. Comtech’s fourth quarter
    net sales assumptions now reflect this and other changes in product
    mix (including lower expected sales of higher margin cyber training
    software solutions).
  • Comtech’s fourth quarter net sales and Adjusted EBITDA are expected to
    be higher than the related amounts achieved in its third quarter of
    fiscal 2018 by approximately 15.0%. Comtech’s GAAP operating income
    and Adjusted EBITDA, as a percentage of its consolidated fourth
    quarter fiscal 2018 net sales, are expected to approximate 6.0% and
    15.0%, respectively.
  • Comtech’s new estimated effective tax rate of 27.0% for fiscal 2018
    reflects seven months of benefit related to Tax Reform. Although
    Comtech continues to perform an analysis of Tax Reform and its impact,
    Comtech’s assessment is that its effective tax rate in fiscal 2019,
    before any discrete items, will now range from 23.5% to 25.0%. During
    the nine months ended April 30, 2018, Comtech recorded an estimated
    net discrete tax benefit of $14.1 million, primarily due to the
    remeasurement of deferred tax liabilities associated with
    non-deductible amortization related to intangible assets that was
    required as a result of Tax Reform.
  • Comtech is updating its GAAP diluted EPS target to a new range of
    $1.17 to $1.23, as compared to a prior range of $1.08 to $1.23. The
    new target range includes the benefit of $0.59 per diluted share
    primarily due to the remeasurement of deferred tax assets and
    liabilities as a result of Tax Reform. GAAP diluted EPS for Comtech’s
    fourth quarter of fiscal 2018 is expected to approximate a range of
    $0.24 to $0.30 per diluted share.
  • If order flow remains strong and Comtech is able to achieve all of its
    fiscal 2018 business goals, it is possible that Comtech’s fiscal 2018
    consolidated net sales, GAAP diluted EPS and Adjusted EBITDA could be
    higher than its targeted amounts.

Additional information about Comtech’s third quarter financial results
and Business Outlook for Fiscal 2018 is more thoroughly described in
Comtech’s Form 10-Q filed with the SEC today and Comtech’s third quarter
investor presentation which is located on its website at


Comtech has scheduled an investor conference call for 8:30 AM (ET) on
Thursday, June 7, 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
Alternatively, investors can access the conference call by dialing (877)
876-9176 (domestic), or (785) 424-1667 (international) and using the
conference I.D. “Comtech.” A replay of the conference call will be
available for seven days by dialing (800) 839-2434 or (402) 220-7211. In
addition, an updated investor presentation, including earnings guidance,
is available on Comtech’s website.




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 HeightsTM 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 enacted in
December 2017 in the U.S.; and other factors described in this and the
Company’s other filings with the Securities and Exchange Commission.





4月30日に終了した3ヵ月間、 4月30日に終了した9ヵ月間、
2018 2017 2018 2017
売上高 $ 147,854,000 127,792,000 403,154,000 402,606,000
売上原価 85,418,000 75,331,000 242,201,000 244,833,000
売上総利益 62,436,000 52,461,000 160,953,000 157,773,000
販売費及び一般管理費 30,410,000 25,923,000 86,100,000 89,596,000
研究・開発 12,778,000 12,961,000 39,963,000 40,371,000
無形固定資産償却費 5,269,000 5,468,000 15,806,000 17,555,000
知的財産権訴訟の和解 - (2,041,000 ) - (12,020,000 )
48,457,000 42,311,000 141,869,000 135,502,000
営業利益 13,979,000 10,150,000 19,084,000 22,271,000
支払利息 2,500,000 2,761,000 7,607,000 8,938,000
利息(収益)およびその他 198,000 88,000 189,000 12,000

Income before provision for (benefit from)
income taxes

11,281,000 7,301,000 11,288,000 13,321,000
法人税等調整額(利益 3,071,000 2,884,000 (11,023,000 ) 4,808,000
当期純利益 $ 8,210,000 4,417,000 22,311,000 8,513,000
ベーシック $ 0.34 0.19 0.94 0.36
希薄化 $ 0.34 0.19 0.93 0.36

Weighted average number of common shares
outstanding – basic

23,834,000 23,449,000 23,819,000 23,420,000

Weighted average number of common and
common equivalent
shares outstanding – diluted

24,052,000 23,503,000 23,999,000 23,449,000

Dividends declared per issued and outstanding
common share as
of the applicable dividend
record date

$ 0.10 0.10 0.30 0.50




2018年4月30日(金 2017年7月31日
(未監査) (監査済)

現金及び現金同等物 $ 44,173,000 41,844,000
売掛金(純額 127,267,000 124,962,000
棚卸資産(純額 76,554,000 60,603,000
前払い費用およびその他の流動資産 13,912,000 13,635,000
流動資産合計 261,906,000 241,044,000
有形固定資産(純額) 30,240,000 32,847,000
のれん 290,633,000 290,633,000
耐用年数が確定している無形資産(純額) 246,065,000 261,871,000
繰延金融費用(純額 2,420,000 3,065,000
その他の資産(純額 2,808,000 2,603,000
総資産額 $ 834,072,000 832,063,000
買掛金 $ 30,125,000 29,402,000
未払費用およびその他の流動負債 66,258,000 68,610,000
配当金支払額 2,354,000 2,343,000
Customer advances and other 33,485,000 25,771,000
一年以内返済予定長期借入金 17,211,000 15,494,000
一年内返済予定のキャピタル・リースおよびその他の債務 2,540,000 2,309,000
支払利息 532,000 282,000
流動負債合計 152,505,000 144,211,000
長期債務の非流動部分(純額 161,856,000 176,228,000
キャピタル・リースおよびその他の債務の非流動部分 993,000 1,771,000
未払法人税等 2,592,000 2,515,000
繰延税金負債(純額 6,069,000 17,306,000
Customer advances and other, non-current 7,761,000 7,227,000
その他の負債 4,512,000 2,655,000
負債合計 336,288,000 351,913,000


- -

Common stock, par value $.10 per share; authorized 100,000,000
issued 38,675,301 shares and 38,619,467 shares at
April 30, 2018 and July
31, 2017, respectively

3,868,000 3,862,000
追加払込資本 535,620,000 533,001,000
利益剰余金 400,145,000 385,136,000
939,633,000 921,999,000

Treasury stock, at cost (15,033,317 shares at April 30, 2018
July 31, 2017)

(441,849,000 ) (441,849,000 )
株主資本合計 497,784,000 480,150,000
負債および株主資本合計 $ 834,072,000 832,063,000



Reconciliation of Non-GAAP Financial Measures to GAAP Financial Measures



投資家の皆様に当社の業績に関する追加情報を提供するため、本プレスリリースには「非 GAAP 型財務情報」が含まれています。
当社は、投資家およびアナリストが当社の業績および他社との比較可能性を評価する際に、調整後 EBITDA を当社の SEC 提出書類に記載された他の情報とともに使用するものと考えています。
これらの指標に影響を与える特定の項目である株式報酬や税金費用の調整、無形資産償却、支払利息などの項目は、まだ発生し ておらず、当社の管理下にはなく、予測することもできません。例えば、株式報酬費用の定量化には

4月30日に終了した3ヵ月間、 4月30日に終了した9ヵ月間、 会計年度
2018 2017 2018 2017 2017

Reconciliation of GAAP Net Income to

当期純利益 $ 8,210,000 4,417,000 22,311,000 8,513,000 $ 15,827,000
法人税等調整額(利益 3,071,000 2,884,000 (11,023,000 ) 4,808,000 9,654,000
利息(収益)およびその他の費用 198,000 88,000 189,000 12,000 (68,000 )
支払利息 2,500,000 2,761,000 7,607,000 8,938,000 11,629,000
株式ベースの報酬の償却 1,104,000 991,000 2,931,000 2,980,000 8,506,000
無形固定資産償却費 5,269,000 5,468,000 15,806,000 17,555,000 22,823,000
減価償却費 3,170,000 3,532,000 9,833,000 10,849,000 14,354,000
知的財産権訴訟の和解 - (2,041,000 ) - (12,020,000 ) (12,020,000 )
調整後EBITDA $ 23,522,000 18,100,000 47,654,000 41,635,000 $ 70,705,000


Michael D. Porcelain, Senior Vice President and Chief
Financial Officer
[email protected]


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