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.

电话会议

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.

关于康泰克

Comtech电信公司设计、开发、生产和销售用于先进通信的创新产品、系统和服务。
创新产品、系统和服务的先进通信解决方案。
解决方案。康泰科向全球商业和政府通信市场的不同客户群销售产品。
全球商业和政府通信市场的不同客户群。

关于前瞻性声明的警告性声明

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.

和子公司

简明综合业务报表

(未经审计)

Three months ended January 31, Six months ended January 31,
2018 2017 2018 2017
净销售额 $ 133,731,000 139,028,000

255,300,000 274,814,000
销售成本 82,930,000 85,824,000 156,783,000 169,502,000
毛利润 50,801,000 53,204,000 98,517,000 105,312,000
支出:
销售、一般和行政 27,215,000 30,988,000 55,690,000 63,673,000
研究与发展 13,435,000 13,314,000 27,185,000 27,410,000
无形资产的摊销 5,268,000 6,032,000 10,537,000 12,087,000
知识产权诉讼的解决 - (9,979,000 ) - (9,979,000 )
45,918,000 40,355,000 93,412,000 93,191,000
营业收入 4,883,000 12,849,000 5,105,000 12,121,000
其他费用(收入):
利息支出 2,519,000 2,852,000 5,107,000 6,177,000
利息(收入)和其他 (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
净收入 $ 15,761,000 6,585,000

14,101,000 4,096,000
每股净收入:
基本 $ 0.66 0.28

0.59 0.17
稀释的 $ 0.66 0.28

0.59 0.17
已发行普通股的加权平均数-基本 23,816,000 23,428,000 23,805,000 23,406,000
普通股和普通股等价物的加权平均数
流通股 - 摊薄
23,953,000 23,445,000 23,942,000 23,427,000
在适用的红利记录日,每股已发行的普通股所宣布的红利
股息记录日
$ 0.10 0.10

0.20

0.40

COMTECH TELECOMMUNICATIONS CORP.

和子公司

简明合并资产负债表

January 31, 2018 2017年7月31日
(未经审计) (已审计)
资产

流动资产:
现金和现金等价物 $ 40,472,000 41,844,000
应收账款,净额 117,973,000 124,962,000
存货,净值 71,707,000 60,603,000
预付费用和其他流动资产 14,915,000 13,635,000
流动资产总额 245,067,000 241,044,000
财产、厂房和设备,净值 30,122,000 32,847,000
商誉 290,633,000 290,633,000
寿命有限的无形资产,净值 251,334,000 261,871,000
递延融资成本,净额 2,635,000 3,065,000
其他资产,净值 2,860,000 2,603,000
总资产 $ 822,651,000 832,063,000
负债和股东权益
流动负债:
应付账款 $ 27,662,000 29,402,000
应计费用和其他流动负债 60,585,000 68,610,000
应付股利 2,351,000 2,343,000
客户预付款和存款 24,848,000 25,771,000
长期债务的当前部分 17,211,000 15,494,000
资本租赁义务的当前部分 1,858,000 2,309,000
应付利息 83,000 282,000
流动负债总额 134,598,000 144,211,000
长期债务的非流动部分,净值 174,225,000 176,228,000
资本租赁义务的非流动部分 885,000 1,771,000
应付所得税 2,558,000 2,515,000
递延税款负债,净额 6,088,000 17,306,000
客户预付款和存款,非流动 8,385,000 7,227,000
其他负债 5,291,000 2,655,000
负债总额 332,030,000 351,913,000
承诺和或有事项
股东的权益:
优先股,每股面值0.10美元;授权和未发行的股票
未发行的股份 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
额外实收资本 534,224,000 533,001,000
留存收益 394,381,000 385,136,000
932,470,000 921,999,000
少:

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

and July 31, 2017)

(441,849,000 ) (441,849,000 )
股东权益总额 490,621,000 480,150,000
负债和股东权益总额 $ 822,651,000 832,063,000

COMTECH TELECOMMUNICATIONS CORP.

和子公司

非GAAP财务措施与GAAP财务措施的调节
措施
(未经审计)

非公认会计原则财务措施的使用

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, 财政年度
2018 2017 2018 2017 2017
GAAP净收入与调整后EBITDA的对账:
净收入 $ 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
利息(收入)和其他费用 (48,000 ) (74,000 ) (9,000 ) (76,000 ) (68,000 )
利息支出 2,519,000 2,852,000 5,107,000 6,177,000 11,629,000
基于股票的补偿的摊销 1,080,000 1,019,000 1,827,000 1,989,000 8,506,000
无形资产的摊销 5,268,000 6,032,000 10,537,000 12,087,000 22,823,000
折旧 3,317,000 3,568,000 6,663,000 7,317,000 14,354,000
知识产权诉讼的解决 - (9,979,000 ) - (9,979,000 ) (12,020,000 )
调整后的EBITDA $ 14,548,000 13,489,000 24,132,000 23,535,000 $ 70,705,000

ECMTL

媒体:
Michael D. Porcelain,高级副总裁兼首席财务官。
财务官
(631) 962-7103
[email protected]

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