Comtech Telecommunications (CMTL) 8-K Jerome Kapelus, Senior Vice President, Strategy and Business Development

Exhibit 99.1

Media Contacts:

Michael D. Porcelain, Senior Vice President and Chief Financial Officer

Jerome Kapelus, Senior Vice President, Strategy and Business Development

(631) 962-7000

Info@comtechtel.com

COMTECH TELECOMMUNICATIONS CORP. ANNOUNCES

RESULTS FOR THE SECOND QUARTER OF FISCAL 2010 AND

UPDATES REVENUE AND EPS GUIDANCE FOR FISCAL 2010

Melville, New York – March 3, 2010 – Comtech Telecommunications Corp. (NASDAQ: CMTL) today reported its operating results for the three and six months ended January 31, 2010.

Net sales for the second quarter of fiscal 2010 were $171.1 million compared to $143.9 million for the second quarter of fiscal 2009. The period-over-period increase in net sales is attributable to higher sales, as anticipated, in our mobile data communications segment, offset, in part, by lower sales in both our telecommunications transmission and RF microwave amplifiers segments.

GAAP net income was $16.3 million, or $0.51 per diluted share, for the second quarter of fiscal 2010 compared to $12.1 million, or $0.46 per diluted share, for the second quarter of fiscal 2009.

Net sales for the six months ended January 31, 2010 were $304.9 million compared to $335.8 million for the six months ended January 31, 2009. The period-over-period decrease in net sales is attributable to lower sales, as anticipated in both our telecommunications transmission and RF microwave amplifiers segments, partially offset by an increase in sales in our mobile data communications segment.

GAAP net income was $25.4 million, or $0.81 per diluted share, for the six months ended January 31, 2010 compared to $33.7 million, or $1.26 per diluted share, for the six months ended January 31, 2009.

During the second quarter of fiscal 2010, the Company’s third-party supplier of new MTS ruggedized computers and certain related accessories continued to experience production and technical issues. These issues, which are ongoing, resulted in shipping and related deployment delays to the U.S. Army, which impacted the Company’s second quarter results. Based on the third-party supplier’s revised delivery schedule provided to Comtech yesterday, the Company expects that approximately $90.0 million to $100.0 million of orders in its backlog previously expected to ship in fiscal 2010 will now ship in fiscal 2011. Based on the Company’s year to date results and the impact of the aforementioned shift of revenue, the Company now expects fiscal 2010 revenue to approximate $740.0 million to $760.0 million and its fiscal 2010 diluted earnings per share to approximate $1.85 to $1.95.

In commenting on the Company's performance and updated revenue and EPS guidance, Fred Kornberg, President and Chief Executive Officer, stated, “Although we are disappointed that our third-party supplier continues to experience production-related issues, our second quarter results for fiscal 2010 were solid and we continue to believe that fiscal 2010 will be another year of record revenues and that our operating income will significantly increase as compared to fiscal 2009.”

Mr. Kornberg added, “Our market leadership positions are firmly intact and we continue to invest for the eventual economic recovery. We see some signs that global business conditions are slowly improving and we believe that this will bode well for us in fiscal 2011. Additionally, with over $514.2 million of cash and cash equivalents, we are well-positioned to achieve our strategic goal of executing key acquisitions that will supplement our expected organic growth as well as diversify our business.”

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Selected Fiscal 2010 Second Quarter Financial Metrics and Other Items

·   Backlog as of January 31, 2010 was $446.8 million compared to $549.8 million as of July 31, 2009 and $462.1 million as of January 31, 2009. Bookings for the three and six months ended January 31, 2010 were $82.3 million and $202.9 million, respectively, compared to $386.9 million and $545.5 million for the three and six months ended January 31, 2009, respectively.

·   Earnings before interest, taxes, depreciation and amortization, including amortization of acquired in-process research and development (“EBITDA”), was $33.7 million and $55.1 million for the three and six months ended January 31, 2010, respectively, versus $27.1 million and $77.1 million for the three and six months ended January 31, 2009, respectively.

·   At January 31, 2010, the Company had $514.2 million of cash and cash equivalents. Net cash provided by operating activities was $28.0 million for the six months ended January 31, 2010 compared to $24.4 million for the six months ended January 31, 2009.

·   As further discussed in the Company’s Form 10-Q filed earlier today, on August 1, 2009, although the Company’s 2.0% convertible senior notes were no longer outstanding, it was required to retroactively adjust the historical reporting relating to its 2.0% convertible senior notes in accordance with FASB ASC 470-20, “Debt - Debt with Conversion and Other Options.” The retroactive adjustment did not impact the Company’s diluted earnings per share for the three and six months ended January 31, 2009.

Conference Call

The Company has scheduled an investor conference call for 8:30 AM (ET) on Thursday, March 4, 2010. Investors and the public are invited to access a live webcast of the conference call from the investor relations section of the Comtech web site at www.comtechtel.com. Alternatively, investors can access the conference call by dialing (800) 862-9098 (domestic) or (785) 424-1051 (international) and using the conference I.D. of “Comtech.” A replay of the conference call will be available for seven days by dialing (402) 220-0871. In addition, an updated investor presentation, including earnings guidance, will be available on our web site shortly after the conference call.

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About Comtech

Comtech Telecommunications Corp. designs, develops, produces and markets innovative products, systems and services for advanced communications solutions. The Company believes many of its solutions play a vital role in providing or enhancing communication capabilities when terrestrial communications infrastructure is unavailable, inefficient or too expensive. The Company conducts business through three complementary segments: telecommunications transmission, mobile data communications and RF microwave amplifiers. The Company sells products to a diverse customer base in the global commercial and government communications markets. The Company believes it is a market leader in the market segments that it serves.

Cautionary Statement Regarding Forward-Looking Statements

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 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 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, frequent new product announcements and enhancements, changing customer demands, changes in prevailing economic and political conditions, risks associated with the results of ongoing investigations into the Company’s compliance with export regulations, risks associated with the Radyne acquisition, risks associated with the Company’s legal proceedings and other matters, risks associated with the Company’s recent MTS orders, risks associated with the Company’s MTS and BFT contracts, risks associated with the Company’s obligations under its revolving credit facility, and other factors described in the Company’s filings with the Securities and Exchange Commission.

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COMTECH TELECOMMUNICATIONS CORP.

AND SUBSIDIARIES

Condensed Consolidated Statements of Operations

(Unaudited)

	Three months ended January 31,						Six months ended January 31,
	2010			2009			2010			2009
				(as adjusted)						(as adjusted)
Net sales	$	171,132,000			143,886,000			304,948,000			335,801,000
Cost of sales		107,631,000			84,409,000			191,673,000			189,345,000
Gross profit		63,501,000			59,477,000			113,275,000			146,456,000
Expenses:
Selling, general and administrative		22,909,000			25,969,000			44,628,000			54,947,000
Research and development		11,431,000			12,522,000			22,755,000			26,647,000
Amortization of acquired in-process research and development		-			-			-			6,200,000
Amortization of intangibles		1,765,000			1,796,000			3,529,000			3,589,000
		36,105,000			40,287,000			70,912,000			91,383,000
Operating income		27,396,000			19,190,000			42,363,000			55,073,000
Other expenses (income):
Interest expense		1,966,000			1,894,000			3,933,000			3,719,000
Interest income and other		(178,000	)		(626,000	)		(413,000	)		(1,903,000	)
Income before provision for income taxes		25,608,000			17,922,000			38,843,000			53,257,000
Provision for income taxes		9,275,000			5,826,000			13,478,000			19,520,000
Net income	$	16,333,000			12,096,000			25,365,000			33,737,000
Net income per share:
Basic	$	0.58			0.49			0.90			1.37
Diluted	$	0.51			0.46			0.81			1.26
Weighted average number of common shares outstanding – basic		28,250,000			24,759,000			28,236,000			24,673,000
Weighted average number of common and common equivalent shares outstanding – diluted		34,080,000			28,633,000			34,069,000			28,585,000

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COMTECH TELECOMMUNICATIONS CORP.

AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

	January 31, 2010			July 31, 2009
Assets	(Unaudited)			(Audited)
				(as adjusted)
Current assets:
Cash and cash equivalents	$	514,155,000			485,450,000
Accounts receivable, net		100,828,000			79,477,000
Inventories, net		90,420,000			95,597,000
Prepaid expenses and other current assets		7,430,000			13,398,000
Deferred tax asset		14,073,000			15,129,000
Total current assets		726,906,000			689,051,000
Property, plant and equipment, net		35,348,000			38,486,000
Goodwill		149,253,000			149,253,000
Intangibles with finite lives, net		51,856,000			55,272,000
Deferred financing costs, net		5,368,000			6,053,000
Other assets, net		1,284,000			556,000
Total assets	$	970,015,000			938,671,000
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable	$	33,631,000			19,233,000
Accrued expenses and other current liabilities		41,539,000			51,741,000
Customer advances and deposits		11,186,000			19,571,000
Interest payable		1,531,000			1,418,000
Income taxes payable		6,290,000			563,000
Total current liabilities		94,177,000			92,526,000
Convertible senior notes		200,000,000			200,000,000
Other liabilities		2,325,000			2,283,000
Income taxes payable		5,363,000			4,267,000
Deferred tax liability		8,246,000			10,466,000
Total liabilities		310,111,000			309,542,000
Commitments and contingencies
Stockholders’ equity:
Preferred stock, par value $.10 per share; shares authorized and unissued 2,000,000		-			-
Common stock, par value $.10 per share; authorized 100,000,000 shares, issued 28,482,155 shares and 28,390,855 shares at January 31, 2010 and July 31, 2009, respectively		2,848,000			2,839,000
Additional paid-in capital		341,057,000			335,656,000
Retained earnings		316,184,000			290,819,000
		660,089,000			629,314,000
Less:
Treasury stock (210,937 shares)		(185,000	)		(185,000	)
Total stockholders’ equity		659,904,000			629,129,000
Total liabilities and stockholders’ equity	$	970,015,000			938,671,000

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COMTECH TELECOMMUNICATIONS CORP.

AND SUBSIDIARIES

Reconciliation of Non-GAAP Financial Measures to GAAP Financial Measures

(Unaudited)

	Three Months Ended January 31,				Six Months Ended January 31,
	2010		2009		2010		2009
			(as adjusted)				(as adjusted)
Reconciliation of GAAP Net Income to EBITDA(1):
GAAP net income	$	16,333,000		12,096,000		25,365,000		33,737,000
Income taxes		9,275,000		5,826,000		13,478,000		19,520,000
Net interest expense (income) and other		1,788,000		1,268,000		3,520,000		1,816,000
Amortization of acquired in-process research and development		-		-		-		6,200,000
Amortization of stock-based compensation		1,650,000		2,292,000		3,426,000		4,710,000
Depreciation and other amortization		4,683,000		5,608,000		9,349,000		11,074,000
EBITDA	$	33,729,000		27,090,000		55,138,000		77,057,000

(1)   Represents earnings before interest, income taxes, depreciation and amortization of intangibles, stock-based compensation and acquired in-process research and development. EBITDA is a non-GAAP operating metric used by management in assessing the Company’s operating results. The Company’s definition of EBITDA may differ from the definition of EBITDA used by other companies and may not be comparable to similarly titled measures used by other companies.  EBITDA is also a measure frequently requested by the Company’s investors and analysts. The Company believes that investors and analysts may use EBITDA, along with other information contained in its SEC filings, in assessing its ability to generate cash flow and service debt.

ECMTL

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