Comtech Telecommunications Corp. · NASDAQ:CMTL
Comtech Telecommunications — Southwest IDEAS Conference November 2021
35 slides from Comtech Telecommunications's conference presentation, Nov 17, 2021
Slide 1: Investor Presentation, Southwest IDEAS Conference November 2021
This presentation reflects information as of October 4, 2021 Investor Presentation Southwest IDEAS Conference November 2021
Slide 2: Content
Content 1. Cautionary Statements and Disclaimers 2. Introduction, Q4 2021 and FY2021, and FY2022 Initial Targets 3. About Us and Independent Market Studies 4. Additional Financial Data 5. Reconciliation of GAAP to Non - GAAP Financial Measures 2
Slide 3: Cautionary Statement Regarding Forward-Looking Statements
Cautionary Statement Regarding Forward - Looking Statements 3 Certain information in this presentation contains forward - looking statements, including, but not limited to, information relating to Comtech’s future performance and financial condition, plans and objectives of Comtech’s management and
Slide 4: Use of Non-GAAP Financial Measures
Use of Non - GAAP Financial Measures In order to provide investors with additional information regarding the Company’s financial results, this presentation contains "Non - GAAP financial measures" under the rules of the SEC . The Company’s Adjusted EBITDA is a Non - GAAP measure that represents earn
Slide 5: Legacy of Complex Problem Solving
Legacy of Complex Problem Solving Innovative Solutions for Commercial and Government Customers Thought Leader in Secure Wireless Communications Comtech - Connections that Matter® Note See Reconciliation of GAAP to Non - GAAP Financial Measures section of this presentation for the reconciliation from
Slide 6: Overview of Q4 QTD and YTD FY21 Performance
34.6% 41.5% 23.9% Domestic Intl U.S. Govt 68.0% 32.0% 27.1% 44.9% 28.0% Domestic Intl U.S. Govt Overview of Q4 QTD and YTD FY21 Performance Q4 Financial Performance Q4 FY 2021 Revenue was $145.8 million GAAP Operating Income of $9.7 million includes: - acquisition plan expenses of $0.5 million,
Slide 7: Revenue and Adjusted EBITDA Trends
$ 411.0M $ 550.4M $ 570.6M $ 671.8M $ 616.7M $ 581.7M FY 2016 FY 2017 FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 2016 to 2019 CAGR: 17.8% $ 48.1M $ 70.7M $ 78.4M $ 93.5M $77.8M $ 76.5M FY 2016 FY 2017 FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 2016 to 2019 CAGR: 24.8 % Revenue and Adjusted EBITDA Trends R
Slide 8: We Have Visibility to Over $1.1 Billion of Future Revenue
We Have Visibility to Over $1.1 Billion of Future Revenue Commercial Solutions Government Solutions $526.4M $729.4M $132.5M $399.5M $203.0M $267.0M Backlog Contracts in Place, Not in Backlog Revenue Visibility $658.9M ~ $1.1B +++ $470.0M As of July 31, 2021 As of July 31, 2021 (1) Notes (1) Examples
Slide 9: FY 2022 Targets
Revenue $580.0M - $600.0M Adjusted EBITDA (1) $70.0M - $76.0M FY 2022 Targets (1) Adjusted EBITDA represents earnings (loss) before income taxes, interest (income) and other, write - off of deferred financing cos ts, interest expense, amortization of stock - based compensation, amortization of intan
Slide 10: About Us
11/17/2021 1:25:12 PM 10 About Us
Slide 11: Revenues did not exist in FY 2015: milestones
FY 2015 2019 2018 2020 2016 Approximately $372M or 64% of our FY 2021 revenues did not exist in FY 2015 2020: Wins statewide contract valued at up to $54.0M to design, deploy, and operate NG 911 services for the State of South Carolina. 2022 2021: Secured over $200.0M of NG 911 contract wins with th
Slide 12: Well Positioned to Exploit an Inflection Point in the Satcom Industry
We Are Well Positioned to Exploit an Inflection Point in the Satcom Industry “One - Stop - Shop” Approach Allows Comtech To Maximize Long - Term Market Growth Opportunities Satellite Cellular for 3G/4G/5G Complete Solutions Portfolio Deep, Global Market Access R&D and Distribution Scale Government &
Slide 13: Comtech Delivers the Most Important Call You Will Ever Make
Comtech Delivers the Most Important Call You Will Ever Make 800+ PSAPs 60M+ Pop. 9 Statewide 6 R egional 5,600+ PSAPs 220M+ Subs 4,600+ PSAPs 5 0M+ Subs Supporting Next Generation Upgrades and 911 End - to - End Solutions Wireless 911 Solutions NG 911 Solutions VOIP 911 Solutions “Comtech offers the
Slide 14: Proliferation of Networks
Proliferation Of Networks The Ongoing Proliferation of Connected Devices Requires Network Enhancements for Speed, Accuracy, Safety and Connectability Comtech’s Technologies Advance Mission Critical Networks and Modernization Comtech’s unique TDMA and SCPC technology, used in VSAT platforms, has soft
Slide 15: Hundreds of Millions Multi-Year Agreement for Next-Gen Satellite Technology
“Hundreds of Millions” Multi - Year Agreement for Next - Gen Satellite Technology Rapidly Growing Connectivity Demand 15 We anticipate incurring strategic and “start - up” emerging technology costs for next - generation satellite technology. Spending will advance our solution offerings to be use
Slide 16: Comtech's Two Segments Have Common Capabilities
Comtech’s Two Segments Have Common Capabilities We leverage several key competencies, including R&D and engineering, across both segments to deliver superior capabilities to customers Secure Wireless Technology Communications Commercial Solutions Revenue $360.1M 61.9 % of Total Adjusted EBITDA $66.3
Slide 17: The Satellite Ground Station Equipment Market is Expected to Grow
The Satellite Ground Station Equipment Market is Expected to Grow $- $100 $200 $300 $400 USD millions 2019 - 2029 Market Growth by Application Cellular Backhaul Baseband Equipment IP Content Distribution Aeronautical Satcom Earth Stations Enterprise VSAT Maritime Satcom M2M Land-Mobile Trunking $- $
Slide 18: Comtech is a Leader in the NextGen Public Safety Market
Comtech is a Leader in the 911 NextGen Public Safety Market • Frost & Sullivan names Comtech as the fastest growing NG911 provider in the U.S. • Key NG - 911 wins: Massachusetts, Pennsylvania, South Carolina, Arizona, Iowa, Washington, Maine, Ohio. • Comtech also has a small but growing market share
Slide 19: Extensive Acquisition Experience with Successful Integrations
x Entry into the 911 public safety and location markets and significantly strengthened our U.S. Government business, created scale and diversified earnings x Further expanded presence in growing 911 public safety market and increased recurring revenues x Helped secure a five - year $100.0M contract
Slide 20: We Believe the Future is Bright for Many Years to Come
Strong Visibility with Growing Markets History of Long - Term Capital Return to Stockholders Commitment to Innovation and Engineering Experienced Management Team Market Leadership Positions We Believe the Future is Bright for Many Years to Come 20
Slide 21: Additional Financial Data
: Additional Financial Data ro Gl
Slide 22: Historical Revenue Results
2017 2018 2019 2020 2021 $219,501 $225,513 $314,504 $262,985 $221,549 Government Solutions Historical Revenue Results Note (1) Comtech’s fiscal year end is July 31. 2017 2018 2019 2020 2021 $330,867 $345,076 $357,293 $353,730 $360,146 Commercial Solutions $ in 000s $ in 000s 2017 2018 2019 2020 2021
Slide 23: Historical Bookings & Backlog
Historical Bookings & Backlog Note (1) Comtech’s fiscal year end is July 31. (2) See slide 8 for additional information related to funded backlog and unfunded portions of contracts in place. $ in 000s $ in 000s Bookings Total Backlog (2) 2017 2018 2019 2020 2021 $512,593 $755,054 $724,056 $584,448 $
Slide 24: Our Customer Base
Our Customer Base Notes (1) Comtech’s fiscal year end is July 31. (2) Totals may not foot due to rounding . 2017 2018 2019 2020 2021 33% 36% 40% 36% 35% 39% 39% 35% 40% 41% 28% 26% 25% 24% 24% U.S. Government Domestic International 24
Slide 25: Historical Balance Sheet Trends
Historical Balance Sheet Trends Balance Sheet Notes (1) As defined in our Credit Facility, as amended. Fiscal 2017 and 2018 include capital lease obligations. Excludes insignificant amounts of finance lease obligations. (2) Comtech’s fiscal year end is July 31. 25 Jul. 31, Jul. 31, Jul. 31, Jul. 31,
Slide 26: Historical Research and Development Expense
Historical Research and Development Expense Notes (1) Research and development expense includes company - funded and customer - funded. (2) Comtech’s fiscal year end is July 31. 2017 2018 2019 2020 YTD 2021 $81,310 $70,793 $71,086 $64,103 $62,783 $ in 000s Research and Development Expense 26
Slide 27: Recent Quarterly Operating Results
Recent Quarterly Operating Results Q4 Q1 Q2 Q3 Q4 $ in 000s 2020 2021 2021 2021 2021 Revenue Commercial Solutions 84,983$ 81,802$ 87,825$ 91,364$ 99,154$ Government Solutions 64,690 53,416 73,467 48,012 46,655 Total Revenue 149,673$ 135,218$ 161,292$ 139,376$ 145,809$ Net Income (Loss) 1,126$ (85,84
Slide 28: Historical Annual Operating Results
Historical Annual Operating Results $ in 000s 2017 2018 2019 2020 2021 Revenue Commercial Solutions 330,867$ 345,076$ 357,293$ 353,730$ 360,146$ Government Solutions 219,501 225,513 314,504 262,985 221,549 Total Revenue 550,368$ 570,589$ 671,797$ 616,715$ 581,695$ Net Income (Loss) 15,827$ 29,769$ 2
Slide 29: Market Data
- Market Data ~ SY
Slide 30: Market Data
Market Data General Market Information Nasdaq Symbol: CMTL Institutional Holders (2) : 217 52 - Week Range (1) : $13.20 - $30.01 Analyst Coverage: 6 Source: Nasdaq Analysts Notes (1) 52 - week range indicates the high and low closing prices during the period of August 1, 2020 through July 31, 2021.
Slide 31: Reconciliation of GAAP to Non-GAAP Financial Measures
Reconciliation of GAAP to Non - GAAP Financial Measures
Slide 32: Reconciliation of CMTL GAAP to Non-GAAP: Quarterly Adjusted EBITDA
Reconciliation of CMTL GAAP to Non - GAAP Financial Measures Adjusted EBITDA Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 Q3 2021 Q4 2021 Reported net income (loss) 6,388$ 3,495$ (3,989)$ 1,126$ (85,840)$ 4,205$ 792$ 7,363$ Income tax expense (benefit) 1,145 1,117 (759) 787 (2,239) (155) 316 578
Slide 33: Reconciliation of CMTL GAAP to Non-GAAP: Annual Adjusted EBITDA
Reconciliation of CMTL GAAP to Non - GAAP Financial Measures Adjusted EBITDA 2017 2018 2019 2020 2021 Reported net income (loss) 15,827$ 29,769$ 25,041$ 7,020$ (73,480)$ Income tax expense (benefit) 9,654 (5,143) 3,869 2,290 (1,500) Write-off of deferred financing costs - - 3,217 - - Net interest ex
Slide 34: Reconciliation of Earnings per Diluted Share
Reconciliation of CMTL GAAP to Non - GAAP Financial Measures Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY Earnings (Loss) per Diluted Share 2020 2020 2020 2020 2020 2021 2021 2021 2021 2021 GAAP earnings (loss) per diluted share 0.26$ 0.14$ (0.16)$ 0.04$ 0.28$ (3.39)$ 0.17$ 0.03$ 0.28$ (2.86)$ Acquisition plan exp
Slide 35: About Comtech
About Comtech Comtech Telecommunications Corp. is a leading global provider of next-generation 911 emergency systems and secure wireless communication technologies to commercial and government customers around the world. Headquartered in Melville, New York and with a passion for customer success, Co
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