Comtech Telecommunications Corp. Reports Results for the 1st Quarter of Fiscal 2016 and Updated Guidance
Melville, NY, December 10, 2015--Comtech Telecommunications Corp. (NASDAQ:CMTL) today reported its operating results for the three months ended October 31, 2015. Net sales for the three months ended October 31, 2015 were $64.1 million compared to $76.4 million for the three months ended October 31, 2014.
The period-over-period decrease reflects significantly lower net sales in the Company's telecommunications transmission segment, partially offset by higher net sales in its RF microwave amplifier segment. Sales in its mobile data communications segment were nominally lower period-over-period. Consistent with the Company's prior guidance discussed during its September 29, 2015 investor call, the Company's first quarter results are expected to be the lowest quarter of fiscal 2016.
GAAP net income was $1.4 million, or $0.09 per diluted share, for the three months ended October 31, 2015 as compared to $5.2 million, or $0.32 per diluted share, for the three months ended October 31, 2014. Excluding $1.4 million of pre-tax expenses related to the Company's focused acquisition plan that were incurred during the three months ended October 31, 2015, diluted EPS would have been $0.15. The large majority of the focused acquisition plan expenses related to activities which resulted in the November 2015 signing of a definitive merger agreement to acquire TeleCommunication Systems, Inc. ("TCS"), a leading provider of mission critical Command, Control, Communications, Computers, Intelligence, Surveillance and Reconnaissance (“C4ISR”) solutions and next generation emergency 911 services to leading cellular and Voice Over Internet Protocol ("VoIP") providers.
The company also announced that it is maintaining its fiscal 2016 revenue guidance of $300.0 million to $310.0 million and maintaining its fiscal 2016 Adjusted EBITDA guidance of $50.0 million to $54.0 million. Including the $1.4 million of pre-tax expenses related to the Company's focused acquisition plan, GAAP diluted EPS is now expected to be between $1.28 and $1.44. Excluding the $1.4 million of pre-tax expenses related to the Company's focused acquisition plan, the Company's diluted EPS guidance for fiscal 2016 would have been between $1.34 and $1.50. The Company’s fourth quarter of fiscal 2016 is still expected to be the peak quarter in fiscal 2016. The Company’s fiscal 2016 guidance does not give effect to the TCS acquisition, which is expected to close no later than March 2016. The Company expects to provide combined revenue, Adjusted EBITDA and diluted earnings per share guidance, which will give effect to the TCS acquisition, in a future announcement following the closing of the acquisition.
In commenting on the company's performance and fiscal 2016 business outlook, Dr. Stanton Sloane, President and Chief Executive Officer, stated, “Although market conditions remain challenging, we continue to execute our business strategies and position ourselves for growth when our end-markets improve.”
Dr. Sloane added, “I believe that the acquisition of TCS is a turning point for Comtech and I am excited about the growth opportunities that are ahead of us. With a combination of experience, careful planning and preparation, we are well on our way to bring these two great companies together and I look forward to working with all stakeholders to make this acquisition a success.”
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