NASDAQ$CMTL

Comtech Telecommunications Corp · Q4 2020 earnings

Q4 2020 earnings · · Investor relations

Briefing

Comtech reported solid Q4 2020 results, showing a sequential increase in net sales and achieving a book-to-bill ratio of 1.07. The company's prudent financial management enabled them to generate strong operating cash flows.

Comtech Telecommunications Corp. reported solid fourth-quarter results for fiscal year 2020, with net sales of $149.7 million and a book-to-bill ratio of 1.07. The company reported operating income of $2.8 million, a net income of $1.1 million and EPS of $0.04. Comtech provided forward-looking comments and financial targets for fiscal 2021.

  • Consolidated net sales for the fourth quarter of fiscal 2020 were solid at $149.7 million, representing a sequential increase of 10.8% compared to the previous quarter.
  • Bookings of $159.7 million resulted in a book-to-bill ratio of 1.07 for the fourth quarter of fiscal 2020.
  • GAAP operating income was $2.8 million, net income was $1.1 million, and EPS was $0.04 for the fourth quarter of fiscal 2020.
  • Adjusted EBITDA for the fourth quarter of fiscal 2020 was $23.5 million, or 15.7% of consolidated net sales, with strong GAAP operating cash flows of $13.8 million.

Headline financials

Total Revenue

$150M

Previous: $176M-15.1%
EPS (adj)

$0.21

Previous: $0.29-27.6%
Book-to-Bill Ratio

1.07

No prior period
Capital Expenditures

$2.81M

Previous: $2.4M+17.0%
Free Cash Flow

$11M

Previous: $11.8M-7.1%
Net Income

$1.13M

Previous: $6.14M-81.6%
Operating Income

$2.82M

Previous: $10.4M-72.9%
Gross Profit

$49.7M

Previous: $64M-22.4%
Cash & Equivalents

$47.9M

Previous: $45.6M+5.1%
Total Assets

$930M

Previous: $888M+4.7%

Revenue & EPS history

Comtech · Revenue · Quarterly

$150M

Q4 2020-15.1%vs Q4 2019
Beat estimate in 11 of 16 quarters(69%)
ActualEstimate

Revenue by segment

Comtech · $106M total across 2 segments · Q3 2026

  • Allerium
    $55.7M
  • Satellite and Space Communications
    $50.3M

Forward guidance

Comtech expects fiscal 2021 consolidated net sales and Adjusted EBITDA will be slightly higher than the amounts achieved in fiscal 2020.

Tailwinds

  • Strong demand for Manpack Satellite Terminals, networking equipment and other advanced VSAT products by the U.S. Army.
  • Ongoing sustainment services to the U.S. Army for the AN/TSC-198A SNAP terminal.
  • Sustainment services for the U.S. Army's Project Manager Mission Command (“PM MC”) Blue Force Tracking (“BFT-1”) program.
  • Joint Cyber Analysis Course (“JCAC”) training solutions.
  • Additional orders for the newly introduced Comtech COMET, the world’s smallest deployable troposcatter terminal, and its next-generation troposcatter system used by the U.S. Marine Corps.

Headwinds

  • Fiscal 2021 net sales will reflect the absence of a high margin 911 call routing software contract from a large U.S. mobile network operator whose contract with Comtech ended in March 2020.
  • Fiscal 2021 will reflect the cessation of certain software-related services provided to a smaller U.S. mobile network operator that was recently acquired by a competitor.
  • Fiscal 2021 operating income will be impacted by acquisition plan expenses (including litigation expenses) associated with the pending acquisitions of Gilat Satellite Networks Ltd. ("Gilat") and UHP Networks, Inc. ("UHP").
  • To-date, during the first quarter of fiscal 2021, the Company has incurred approximately $14.2 million of acquisition related litigation expenses.
  • Acquisition plan expenses are expected to continue through the Company’s second quarter of fiscal 2021.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 19 quarterly earnings reports · overlaid with Q4 2020

Historical avgQ4 2020

-3.1%

Avg return

Earnings day

-3.0%

Avg return

5 days after

-3.9%

Avg return

30 days after

32%

21 / 66 earnings

Positive

+75.6%

Q3 2024

Best reaction

-26.9%

Q1 2024

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q3 2026
Q2 2026-24.5%-25.4%-17.5%
Q1 2026-15.5%-21.3%+51.1%
Q4 2025+7.0%+6.7%+20.7%
Q3 2025+0.0%+14.4%+26.2%
Q2 2025-11.3%-9.4%-36.6%
Q4 2024-24.8%+1.7%-26.6%
Q3 2024+75.6%+67.7%+40.1%
Q2 2024-25.3%-30.1%-56.2%
Q1 2024-26.9%-36.4%-31.8%
Q4 2023+17.8%+17.3%+37.0%
Q3 2023-19.1%-20.6%-23.8%
Q2 2023-15.8%-22.6%-24.8%
Q1 2023+5.4%+3.1%-1.6%
Q4 2022-2.4%+4.2%+5.9%
Q3 2022-24.0%-28.5%-25.9%
Q2 2022-19.3%-19.5%-25.2%
Q1 2022-2.9%-6.8%-6.7%
Q4 2021-13.5%-12.9%+1.1%
Q3 2021-10.4%-12.1%+1.8%
Q2 2021-3.5%-10.4%-13.8%
Q1 2021-14.4%-11.6%+10.5%
Q4 2020-0.2%-0.4%+6.8%
Q3 2020-7.2%+6.6%-13.3%
Q2 2020-15.2%-22.4%-56.8%
Q1 2020-0.5%-3.9%-1.5%
Q4 2019+17.6%+12.3%+6.6%
Q3 2019+17.5%+17.4%+24.0%
Q2 2019-10.0%-14.9%-12.2%
Q1 2019+13.7%+1.5%-2.7%
Q4 2018-5.9%+2.3%-19.0%
Q3 2018-2.0%-4.5%-1.2%
Q2 2018+25.3%+28.2%+23.9%
Q1 2018+6.3%-0.6%+5.3%
Q4 2017-13.5%-4.3%+5.6%
Q3 2017+17.4%+24.0%+23.6%
Q2 2017+24.8%+28.5%+20.6%
Q1 2017-11.9%-4.8%-0.3%
Q4 2016-7.2%-10.0%-24.6%
Q3 2016-10.8%-20.9%-42.3%
Q2 2016+0.0%
Q1 2016-5.7%
Q4 2015-19.4%
Q3 2015-0.4%
Q2 2015-13.1%
Q1 2015-16.0%
Q4 2014-5.7%
Q3 2014+23.3%
Q2 2014+1.4%
Q1 2014+1.9%
Q4 2013+5.8%
Q3 2013+3.5%
Q2 2013-4.9%
Q1 2013-5.8%
Q4 2012-2.7%
Q3 2012+4.5%
Q2 2012+4.2%
Q1 2012-4.4%
Q4 2011+2.0%
Q4 2009+2.0%
Q3 2010-10.8%
Q3 2011-10.8%
Q2 2010-3.5%
Q2 2011-3.5%
Q1 2011-12.1%
Q4 2010-12.1%
Q1 2010-12.1%

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