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.

컨퍼런스 콜

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.

컴텍 소개

는 첨단 통신을 위한 혁신적인 제품, 시스템, 서비스를 설계, 개발, 생산, 판매하는
첨단 통신을 위한 혁신적인 제품, 시스템 및 서비스
솔루션. 컴텍은 글로벌 상업 및 정부 통신 시장의 다양한 고객층에 제품을 판매합니다.
글로벌 상업 및 정부 통신 시장의 다양한 고객층에 제품을 판매합니다.

미래예측 진술에 관한 주의 사항

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.

및 자회사

요약된 연결 재무상태표

(미감사)

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

255,300,000 274,814,000
판매 비용 82,930,000 85,824,000 156,783,000 169,502,000
총 이익 50,801,000 53,204,000 98,517,000 105,312,000
비용:
영업, 일반 및 관리 27,215,000 30,988,000 55,690,000 63,673,000
연구 및 개발 13,435,000 13,314,000 27,185,000 27,410,000
무형자산 상각 5,268,000 6,032,000 10,537,000 12,087,000
지적 재산권 소송 합의 - (9,979,000 ) - (9,979,000 )
45,918,000 40,355,000 93,412,000 93,191,000
영업 이익 4,883,000 12,849,000 5,105,000 12,121,000
기타 비용(수입):
이자 비용 2,519,000 2,852,000 5,107,000 6,177,000
이자(수입) 및 기타 (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
(Benefit from) provision for income taxes (13,349,000 ) 3,486,000 (14,094,000 ) 1,924,000
순이익 $ 15,761,000 6,585,000

14,101,000 4,096,000
주당 순이익:
기본 $ 0.66 0.28

0.59 0.17
희석 $ 0.66 0.28

0.59 0.17
가중 평균 보통주 발행 주식 수 - 기본 사항 23,816,000 23,428,000 23,805,000 23,406,000
보통주 및 보통주에 상응하는 주식의 가중평균 수
미발행 - 희석
23,953,000 23,445,000 23,942,000 23,427,000
해당 배당금 기록일 현재 발행 및 발행된 보통주당 선언된 배당금
해당 배당금 기록일
$ 0.10 0.10

0.20

0.40

COMTECH TELECOMMUNICATIONS CORP.

및 자회사

요약된 연결 대차 대조표

January 31, 2018 2017년 7월 31일
(미감사) (감사)
자산

유동 자산:
현금 및 현금 등가물 $ 40,472,000 41,844,000
미수금, 순 117,973,000 124,962,000
재고, 순 71,707,000 60,603,000
선불 비용 및 기타 유동 자산 14,915,000 13,635,000
총 유동 자산 245,067,000 241,044,000
유형자산, 플랜트 및 장비, 순 30,122,000 32,847,000
영업권 290,633,000 290,633,000
유한한 수명을 가진 무형 자산, 그물망 251,334,000 261,871,000
이연 금융 비용, 순 2,635,000 3,065,000
기타 자산, 순 2,860,000 2,603,000
총 자산 $ 822,651,000 832,063,000
부채 및 주주 자본
유동 부채:
미지급금 계정 $ 27,662,000 29,402,000
미지급 비용 및 기타 유동 부채 60,585,000 68,610,000
지급 가능한 배당금 2,351,000 2,343,000
고객 선불 및 예치금 24,848,000 25,771,000
장기 부채의 유동 부채 비율 17,211,000 15,494,000
자본리스 의무의 현재 부분 1,858,000 2,309,000
지급 이자 83,000 282,000
총 유동 부채 134,598,000 144,211,000
장기 부채의 비유동 부분, 순액 174,225,000 176,228,000
자본리스 의무의 비유동 부분 885,000 1,771,000
납부할 소득세 2,558,000 2,515,000
이연법인세 부채, 순 6,088,000 17,306,000
고객 선급금 및 예치금, 비유동성 8,385,000 7,227,000
기타 부채 5,291,000 2,655,000
총 부채 332,030,000 351,913,000
약정 및 비상 상황
주주 자본:
우선주, 액면가 주당 $.10, 승인된 주식 및
미발행 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
추가 납입 자본 534,224,000 533,001,000
이익잉여금 394,381,000 385,136,000
932,470,000 921,999,000
더 적습니다:

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

and July 31, 2017)

(441,849,000 ) (441,849,000 )
총 주주 자본 490,621,000 480,150,000
총 부채 및 주주 자본 $ 822,651,000 832,063,000

COMTECH TELECOMMUNICATIONS CORP.

및 자회사

비일반회계기준 재무 측정값과 일반회계기준 재무 측정값의 조정
측정
(미감사)

비일반회계기준 재무 척도 사용

In order to provide investors with additional information regarding its
financial results, this press release contains “Non-GAAP financial
measures” under the rules of the SEC. The Company’s Adjusted EBITDA is a
Non-GAAP measure that represents earnings (loss) before income taxes,
interest (income) and other expense, interest expense, amortization of
stock-based compensation, amortization of intangibles, depreciation
expense, settlement of intellectual property litigation, acquisition
plan expenses or strategic alternatives analysis expenses and other. The
Company’s definition of Adjusted EBITDA may differ from the definition
of EBITDA used by other companies and therefore may not be comparable to
similarly titled measures used by other companies. Adjusted EBITDA is
also a measure frequently requested by the Company’s investors and
analysts. The Company believes that investors and analysts may use
Adjusted EBITDA, along with other information contained in its SEC
filings, in assessing the Company’s performance and comparability of its
results with other companies. These Non-GAAP financial measures have
limitations as an analytical tool as they exclude the financial impact
of transactions necessary to conduct the Company’s business, such as the
granting of equity compensation awards, and are not intended to be an
alternative to financial measures prepared in accordance with GAAP.
These measures are adjusted as described in the reconciliation of GAAP
to Non-GAAP in the below table, but these adjustments should not be
construed as an inference that all of these adjustments or costs are
unusual, infrequent or non-recurring. Non-GAAP financial measures should
be considered in addition to, and not as a substitute for or superior
to, financial measures determined in accordance with GAAP. Investors are
advised to carefully review the GAAP financial results that are
disclosed in the Company’s SEC filings. The Company has not
quantitatively reconciled its fiscal 2018 Adjusted EBITDA target to the
most directly comparable GAAP measure because items such as stock-based
compensation, adjustments to the provision for income taxes,
amortization of intangibles and interest expense, which are specific
items that impact these measures, have not yet occurred, are out of the
Company’s control, or cannot be predicted. For example, quantification
of stock-based compensation expense requires inputs such as the number
of shares granted and market price that are not currently ascertainable.
Accordingly, reconciliations to the Non-GAAP forward looking metrics are
not available without unreasonable effort and such unavailable
reconciling items could significantly impact the Company’s financial
results.

Three months ended January 31, Six months ended January 31, 회계 연도
2018 2017 2018 2017 2017
GAAP 순이익과 조정 EBITDA의 조정:
순이익 $ 15,761,000 6,585,000 14,101,000 4,096,000 $ 15,827,000
(Benefit from) provision for income taxes (13,349,000 ) 3,486,000 (14,094,000 ) 1,924,000 9,654,000
이자(수입) 및 기타 비용 (48,000 ) (74,000 ) (9,000 ) (76,000 ) (68,000 )
이자 비용 2,519,000 2,852,000 5,107,000 6,177,000 11,629,000
주식 기반 보상 상각 1,080,000 1,019,000 1,827,000 1,989,000 8,506,000
무형자산 상각 5,268,000 6,032,000 10,537,000 12,087,000 22,823,000
감가상각 3,317,000 3,568,000 6,663,000 7,317,000 14,354,000
지적 재산권 소송 합의 - (9,979,000 ) - (9,979,000 ) (12,020,000 )
조정 EBITDA $ 14,548,000 13,489,000 24,132,000 23,535,000 $ 70,705,000

ECMTL

미디어:
마이클 D. 포셀린, 수석 부사장 겸 최고 책임자
재무 책임자
(631) 962-7103
[email protected]

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