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Comtech Telecommunications Corp. has reported its operating results for the first fiscal quarter ended October 31, 2020 and updated its financial targets for fiscal 2021.
Fiscal 2021 First Quarter Highlights
Consolidated net sales of $135.2 million and Adjusted EBITDA of $14.3 million (or 10.6% of consolidated net sales) exceeded Comtech's expectation for its first quarter of fiscal 2021. Adjusted EBITDA is a non-GAAP financial measure which is reconciled to the most directly comparable GAAP financial measure and is more fully defined below.
With bookings of $123.2 million, the Company achieved a book-to-bill ratio (a measure defined as bookings divided by net sales) of 0.91 during its first quarter of fiscal 2021. Backlog as of October 31, 2020 was $605.5 million. The total value of multi-year contracts that Comtech has received is substantially higher than its reported backlog. When adding Comtech’s backlog and the total unfunded value of multi-year contracts that Comtech has received and for which it expects future orders, its revenue visibility approximates $1.0 billion.
The Company incurred an aggregate of $91.2 million of acquisition plan expenses.
Approximately $88.3 million of that amount related to the previously announced litigation and merger termination with Gilat Satellite Networks, Ltd. ("Gilat"), including $70.0 million paid in cash to Gilat. The remaining costs primarily related to the pending acquisition of UHP and GD NG-911 acquisition-related litigation. No tax benefit was recorded for the $70.0 million. The Company also recorded $1.2 million of incremental interest expense for ticking fees related to a now terminated financing commitment letter.
The Company's annual effective income tax rate was 13.75% and excludes a net discrete tax expense of $0.2 million, primarily related to stock-based awards that were settled during the quarter.
Including all acquisition plan expenses and ticking fees incurred, Comtech reported a GAAP operating loss of $85.7 million, a GAAP net loss of $85.8 million and a GAAP net loss per diluted share ("EPS") of $3.39 for the first quarter of fiscal 2021. Excluding such costs, the net discrete tax expense and as reconciled to the most directly comparable GAAP financial measures in the table below, Non-GAAP operating income was $5.5 million, Non-GAAP net income was $3.7 million and Non-GAAP EPS was $0.15.
As of October 31, 2020, Comtech had $32.5 million of cash and cash equivalents and total debt outstanding of $217.0 million.
In commenting on the Company's first quarter fiscal 2021 performance, Fred Kornberg, chairman of the board and chief executive officer, noted, "Our first quarter net sales and Adjusted EBITDA exceeded our expectations. With our diversified customer base, product leadership positions and mounting prospects, we are clearly holding our own despite the second wave of the COVID-19 pandemic. Our second quarter of fiscal 2021 has started off strong with the receipt of a $111.6 million funded order to deploy Next-Generation 911 services to the Commonwealth of Pennsylvania. We believe this contract firmly puts us on pace to achieve a book-to-bill ratio in excess of 1.0 for fiscal 2021 and on track for a respectable fiscal year in light of everything that is going on in the world."