CMTL - Earnings call transcript Q3 2020 | Comtech Telecommunications Corp.

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Ladies and gentlemen thank you for standing by. Welcome to the Comtech Telecommunications Corp.

Third Quarter Fiscal 2020 Earnings Conference Call. At this time, all participants are in a listen-only mode. [Operator Instructions] As a reminder, this conference is being recorded Wednesday, June 3, 2020. to conference like to now would turn over the Mr. I of Comtech DiLorenzo Telecommunications. Jason sir. Please go ahead,

Jason DiLorenzo

Thank the XXXX. Officer; Chief Welcome Chief of third Financial the you. Comtech; to Chief today and Executive quarter for conference call Porcelain, of Officer. of Michael the Officer call Michael and Bondi, fiscal the Fred D. Operating year are With Chairman on Comtech us Kornberg, Telecommunications Board Corp. and President

Harbor are qualified I you Fred The we be information business and Actual forward-looking language. company, outlook in business I and to outlook objectives Safe now and of are statements results to and business the Before the the filings. company’s will entirety the Officer limited Exchange not contained company’s performance, of condition company’s assumptions performance financial and relating Certain outlook the remind on but of Commission to and differ Fred? company’s such call Securities proceed, Comtech, information this pleased the in significant uncertainties. Board regarding information. materially and could Kornberg. forward-looking plans the Chief from such presented Executive by cautionary future the in plans, risks Chairman objectives forward-looking management. the of company’s need include, and to, of introduce statements am and nature their Any involve plans,

Fred Kornberg

for thank Jason, us you, Thank you this joining call. good and everyone, afternoon, on and

Let me about few words the COVID-XX start call pandemic. a this by saying

how current challenging, the and quarter suppliers, call and out our on everyone doubt, I to No has you safety expect, that say from discussed the Also, is our a Health to temporary. turned us surprise quarter strong in coronavirus this pandemic employees, had is spoke hope could the on staying what our was as safe. was saw been to and partners. to characterized As with XXXX. the situation. we was on performance it the top dealing priority customers World March that listening you difficult modest and was due health the of a to coronavirus and healthy protect would we situation time March wrong. We we week the a on QX pipeline that pandemic. X, felt were last we later, The we be. XX, effect by we the Organization situation One thought was Well, But the

there fiscal we in XX, world. Thereafter, throughout a XXXX caused our the business March was by went deterioration On through guidance. later, unexpected days XX sudden COVID-XX and conditions just

can would our we the occurred and few I through Although, quickly continue trust their imagined and leading business. occurring have will a focused. been adjusted EBITDA part has proud our QX industry I positive the and of never technology hear enthusiastic to what this remain over rise our also crisis, in Comtech how to customers Despite We you our cash company. to place performance commitment had, worst about stayed saw and employees I flow. our And expertise. call, the about challenge. grateful employees I’m have dedication never the past months, of exceedingly our to the for we it for our pandemic as Comtech’s customers positive and generated

remains business Our healthy.

Our pipeline full. remains

the earth travel Almost in quarter. impacted our really overview negatively XXX with details, in the that of especially, third Public me what this lines The Porcelain the and pandemic really COVID-XX space. product internationally. If deals our station COVID-XX historically international our Safety and let earth happened Although, or Technologies suspended most, close more importance face- needed during equipment impact impacted all give a to-face, advanced Mike customers reliable communications order anything, line, infrastructure our Mike the the The and Location quality orders our not product of segment, satellite demonstrated sales pipeline. pandemic Commercial is pandemic you like was Commercial will provide station such segment. Bondi as did and satellite to brief

place big customers market in shortly. trust We local Our remains outages we and strong, providing any hope public with Location announce experience Public We in services, state we great XXX Safety operations. believe continue supported and the solutions of continuity agencies wins that flawless very to us. to our and some and didn’t the XXX for

Government the to segment markets. Turning

did see the important for engineering very in pipeline believe, received We order two remains dollars next that, multimillion and the funding services, contract of for DoD revenues won awards customers, we and several for and I some will slippage, Although strong. U.S. initial the fielding government years. result delays particularly prototypes

prowess, quickly for and will also COMET orders the which to what much believe microwave DoD needed, communications has new, We demonstrated been over-the-horizon line, the employable, our rapidly world’s received years we for COMET and the the become call, we engineering terminal. for product warfighter. tropo low COMET The is testament making, a our intercept a smallest tool in

were the we for you our we this and UHP. economic weather lines virus, the strategic impacted although our fundamentals can of We of long-term storms. we the remain strong, acquisitions continue product can negatively by diverse planning Gilat As see, with business believe as with we our feel

Bondi, Mike? over Now our let of provide our the to Mike discussion me will who a financial CFO, call quarter third turn results.

Michael Bondi

Fred. Thank you,

during factor Our and customers. net net and have future a with $XXX.X million, total contracts to sales quarter of quarter $X of XXXX visibility our total to of multiyear total of third third the net the future was in the of million. We value received billion funding, customers approximately expect backlog some $XXX.X revenue. QX unfunded and geographic finished worth consolidated we into we were ratio million with were potential we when third sales that $XXX.X for have book-to-bill U.S.-based perspective, X.XX. you XX.X% sales, fiscal From the international in Bookings were quarter XX.X% which

expense in sales. GAAP percentage profit net or XX.X% gross Our was million $XX.X consolidated was of in QX QX XX.X%. SG&A

Turning the amount, Solutions spent QX $X quarter this with $XX.X for amortization net to expense. representing compensation. of X.X% amortization stock-based in segment development related Solutions intangibles our of was our was was and $XX.X Commercial quarter of research amortization full XXXX million quarter. of or of the stock-based spent million million million $X.X a expense Total remainder sales. the million We January CGC. Government Of spent and third compensation segment, $X.X to our in consolidated acquisition of in reflects

impact we Gilat XXXX, million. $XX the pending fiscal Such include does approximate expecting acquisitions. or are For not to the of UHP amortization amount

quarter million. $X.X Our consolidated was GAAP of operating loss for third fiscal the

of operating million acquisition planned include expenses costs. costs acquisition estimated expenses $X settlement of – $X.X and GAAP million Our contract

consolidated Excluding our $X.X net these income million X.X% sales. or been have operating consolidated of costs, would

or Our of segment our sales, EBITDA sales million X.X% $X.X was or consolidated $XX.X EBITDA related Solutions Commercial was quarter. and of our On adjusted was adjusted related net the for million level, net net sales. Solutions of million in a or in $XX.X XX.X% XX.X% third segment segment Government

Now balance was taxes, cash talk interest, $X.X quarter. expense let about the our me third EPS, in flows sheet. million and Interest

which of approximates the rate to borrowing cash amortization costs current financing X.X%. deferred Our excludes X.XX%

XXXX. which share of net tax loss expense, QX rate $X in or is $XXX,XXX GAAP was million fiscal our discrete $X.XX. net expect XX%, for per a what was loss tax a we now Excluding effective net

net for non-GAAP contract acquisition discrete tax estimated per planned settlement income $X.XX net the was or $X.X and items costs Excluding diluted in quarter, QX share. expenses, million

times. Our had leverage our and remains ratio At we cash, sheet X.XX net of strong. XX, of was balance April debt million $XX.X $XXX.X million,

generated positive we quarter, of million. operating the During $X.X cash inflows

predict to somewhat EBITDA we Given net better remains COVID-XX, than be timing awards do providing customer related specific and adjusted our we QX. financial ceased difficult and although that QX the sales, targets, of expect to it shipments, income

hand to Mike will over I Now, it Mike? Porcelain.

Michael D. Porcelain

Thanks.

stated, we lower quarter. as right of was of from the COVID-XX and sales Fred variety a our delays, start cost-saving experienced measures. As implemented result, significant present a And third order

Let me happening. and detailed by segment what some line give product is you of color

million. last were Commercial decrease year, bookings of X.XX quarter this ratio sales XX.X%. a this compared a million in of to of or Our segment Solutions Net million $XX.X achieved $XX.X book-to-bill $XX.X segment

can been by sales resumption product line this and deployment satellite see line channel station required technology meetings impacted significant sales has travel. and in-person ground video our restrictions new you has on business believe in as methods Here, finalized product slowly started to historically business activities partial new business With some that orders most we to of our of which the has recover recent the QX. world, around enter places generate we

for multiple ground have we projects to awarded for for XXXX contracts U.S. technology expect Department satellite station several initial Importantly, and have beyond. we end Defense that solution revenues critical and these customers, funding been of years support generate received will we several

so. is uncertainty increased the right our government business U.S. important, commercial it international given business more and now, markets always was the Although of even

we well announced two and positioned are Here, recently contracts.

ground-based and to for a a including the will believe millions to happen Cyber Data we phase, the or advanced and for announced Under provide development Eagle $X.X prototype the for we U.S. Aircraft the First, new porting systems million Modernization engineering DLM engineering Satcom Gray support Army’s providing contract will Unmanned by services System. the this fiscal We Security ready begin generate to order which advanced waveforms of program requirements. double-digit and the services, satellite in prime’s customer number airborne hardware years, across once modems of and could supporting installation, Army stringent are XXXX. Link

from services Air large we Space AXM $X.X contractor under a Systems critical a U.S. a the and to contract Space engineering program prime anti-jam and for Missile Force Center. Second, awarded Army support modem or were million Force’s

Air Force for modem satellite terminal communication delivered Our anti-jam will Army communication secure provide equipment with tactical wideband a when the satellite and operations.

engineering it will indefinite receive waveform customer, of initial delivery anti-jam order the contract Center multimillion indefinite also orders I contractor, hardware the military Systems Force’s tactical The development communication prime an this phase. technology. Global Space million Space was delivery, services. the constellation. The Satcom quantity completed, Like prototype In excess in awarded Comtech through contract. expect was production AXM to discussed, hardware satellite and will the on prime be terminals both prime, for Missile capability $XX significant once addition, we key And the a in support providing future. subcontractor a XXX who is ceiling, to million and development Wideband our five-year, operating received and U.S. protected

pretty portfolio to good believe Solutions good our are we ground with XXX Commercial addition visibility technologies. segment’s In business, satellite in of things our location-based government U.S. station from

new projects, have we our contract pandemic of the some finalization location Although we solutions. the importance heightened only in that order has believe delays and experienced for do XXX

communication In fact, the saw reliable demand. solutions of our crisis, unprecedented during highly secure pandemic the peak

lose to result XXX messages and Comtech usage. provide in no normal XXXX, partners our Keep per long their has reliability April cost During the agreed mobile of Americans over with few that it additional our months did a FCC’s and at right ongoing and cost, circumstances. pledge fostered million critical Americans to profit access relationships exceptional of operator highlight our itself over network felt March we decision to of did aligned hour, May, continuing need for do, the and these two-times the messaging of This million solutions. as partners with and mobile not SMS network is into our thing and the and in text our us supported better was dollars Connected connectivity which a the run, help but has with text technologies ensuring

of process As of our that solution will soon. XXX and strong, Next them we multiyear technologies, announce that believe demand for the number remain are it we to remains our projects finalizing and a optimistic we Generation in large relates

XXX they expand a in customer We NGXXX public the Inc, distributor NGXXX, and quarter, time, in to maintain safety the during a Solacom. XXX agencies solutions Midwest. pioneer long relationships on NGXXX in previously and we continue And and acquisition an our with providing leadership. know-how. was and closed Generation a product We Next of as Illinois, partnered to key Iowa local based small Missouri, announced knew

smart to to million deploy secure Given few we purchased for $XX we Right million to have valued to NGXXX, a them support Midwest. after new and in think NGXXX product, more the call several a certain dollars. absolutely more than were We multiyear customers’ more solutions at than contracts buy purchased we less was desire investment. handling able the need

Tier During XG. win a million virtual also that positions strategic, further location-based leading we is mobile were including $X.X operator Public U.S. technology awarded highly $X.X XG contract network which solutions, the enabler applications. a as as supplier five-year This mobile million Comtech contract a key of Safety at we announced quarter, from location-based for for platforms, valued X a it is

product this the and for have been strategy. that year, more we believe recall than of this may win we best, tangible to evidence contract focus of success line do provides repositioning what You our one on we

fully our other are with and is for States it major least working Since location one only announce carrier only standards, and compliant award at real hope industry cloud-native but are adoption, worldwide. XG with not another more major the there We United virtualized, We in opportunities not U.S. in test platform environments, believe is ready all but almost the for soon. to us, world.

As such, positioned operators we networks. XG basis on build to are network help mobile and well their a them with global operate

network In at business directly that are area. from and can activities fact, our in XX we benefit this technology there our operators believe other mobile least focusing

significantly expect public applications All all, use also location-based cases support repositioned is that base as competitive and XG backlog and we Our End market to adopted. will NGXXX, customer our opportunities. is safety to ultimately products safety benefit today, technology government product we a line new XG healthy. subject believe funding to in of creating remains location for enables while conditions, we from strong benefit and public and growing good believe, state relationships, and

Government to let segment. our Solutions Now, turn me

orders sales were tracking U.S. reliability year, largely QX on and and global last and as were $XX.X satellite related lower antennas support Here, due and field satellite-based timing million to net contract to components. $XX.X compared space Army the to in high our million performance

experience of as of QX corona solution shipment did result a strong. pandemic, segment government and this Although order for delays, almost remains demand all our the

for that programs, ratio bookings including XX.X or of of Solutions government, Government U.S. equipment sold strength we particular, and saw In sustainment X.XX book-to-bill for orders the fact, saw million. services VSAT In and achieved SNAP to several a also we segment we the in BFT-X critical our ongoing programs.

continue solutions. QX, orders the we received training government addition, Analysis U.S. large Course posture. JCAC support And its cybersecurity Joint Cyber In to with for during

with efforts bode to are to DoD, the the continuing we We make opportunities multi-year that, for awards believe, win for significant future. several large well

many increased is are can attention that you moon to know, there support we this NASA focused the regard, effort. As of space, by proud is In XXXX. and going on on we this

that awarded subcontractor million utilized to intended next yesterday, contract This program. supply our rocket by U.S. XXXX. help $XX.X we program the third a fact, during In just the launch first space we to the be on quarter, a from is NASA to of for were man Artemis components moon announced and EEE major NASA’s carry women

We orders more are to excited of part this program important be and expect follow-on in the future.

mission microwave we mentioned, over-the-horizon is while over-the-horizon probability a world’s the low reliable, The command. Comtech COMET Comtech Fred as of addition, community announced first an power, In addresses COMET, and the terminal deployable, initial and intercept providing high uniquely airline probability low received the operations the terminal Solacom’s from which rapid, checkable concern order of detection, special of essential low communication. smallest U.S. communication

and receiving additional we Given customers. in new product, our XXXX the from these excited very we forward program, look orders Marine’s this with about of troposcatter both success are U.S. to

mostly integration Limited. and leading which of is full-motion Technology the X/Y CGC, we satellite fixed a in completed Kingdom, based antennas. is the QX, tracking during mobile United of provider CGC Finally, high-precision,

in although in very another can Government do tier sales this lumpy growth we working positioned segment companies to in particular, all, Comtech difficult revenues the top- Although space. be Solutions entities, to today, for project, and in LEO and government our adds small other and well satellite MEO’s All this XXXX. is with dynamic in segment believe and several we European acquisition aerospace are

an Now, acquisition let you update. me give

Networks station XXXX. solutions. and technology provider disruptive healthy coronavirus a is we although me in business, business. remains The let the of leading impacted by a ground First, UHP, which start satellite announced UHP UHP innovative first November with

profits. this ended agreement In UHP. changes fact, and XXXX UHP we able completed given April year amend conditions announced to with economy, with afternoon it record the our record that fiscal its overall in and revenue business were Nevertheless,

the million, reduce $XX reflects price a XX% Specifically, to purchase UHP million agreed price to reduction. from which $XX

wait UHP be closing can to I very flexibility The original or Russia. look at were and together. including to remainder amended we on least million we Additionally, in transaction approval able I now tell $X regulatory customary our balance or Comtech, order $XX that cash the cash board, stock agreement subject us for to to in sheet in to provide was when combination market option conditions, at remains to we a allows deal, an UHP. were pay that forward payable reach we only In more with necessary the $XX close. our to of attacking cannot the you with amended million agreement million cash. them in pleased

Now, Gilat. to turn let me

you solutions of large ground networking and presence in and most and services, markets satellite infrastructures. technology know, in operating network Gilat provides As connectivity expertise the a satellite in-flight with station

with you acquisition Gilat’s some the to comments provide relating me Let business and status.

a a XXXX customers. of and have of to slowdown operating As repeat Gilat has from postponed issued incurred publicly to in coronavirus QX that a financial EBITDA and March words its The markets release, in which in reported itself an simply suspended business. XXXX. fiscal in XXXX, results, it was loss fiscal will by in significantly they is about and I today. Gilat’s XXXX, their press travel sales orders as Gilat for runs remains a experienced public QX that and and Gilat QX information resulted has experienced January the has including compared adjusted company, that reduction They decision-making aviation in impacted own

of regulatory the transaction in the One approval Russia. Gilat conditions to is close

whether it that Russian extension is review purchase Investment an under notification Federal sufficient for the extending intended investments. May or update. allow the Commission to required to Government with supervising Antimonopoly Gilat of determine for was application the government Russian Government Gilat. Service interagency Comtech Law, Federation the Russian approval foreign from of Comtech’s foreign to can received from provide Federal from we to group period the This the the XXXX, Russian authority Here, FAS The the is an Chairman, In investments. the certain transaction Russian is review Commission time

processed let the If Antimonopoly to it to a a second Here, Russian application, out send Gilat a need ongoing comments the but we months. not a application our not will by to take Russian some more is our number of I FAS. this to Federal review, me process warranted, or or Service commission, review, decides to Chairman to that FAS. warranted, a of company, If Service regulatory could to but decides the given regulatory Federal application decides this the and processed Chairman will the the give will continue not If be process fill point we color. be want commission or commission continue the will out is the is you the Antimonopoly Chairman regarding to conditions public making closing remains this transaction. process additional be Gilat relating other by and

as will, however, update investors appropriate. We

to closing me let will turn who Fred, some it back remarks. Now, provide

Fred Kornberg

Mike. Thanks,

As are we times, very are we pleased performing. unprecedented how with I in mentioned these previously,

We current have years for an extremely and will sustained dedicated our and talented come. growth that confident support I’m workforce, approach to

as selling We and approve. customers a focused firmly mix determined We achieve the in to strong, we product good market having diversified protected business market-leading remain line fiscal conditions and strength a Comtech in has and source a past, of commercial positions customer our significant today. extend and have diversified to a and believe to customers, base, are it XXXX, is growth government

third XXXX XX, per return still to a our believe to we XX, more declared of the our Board dividend our business program continue I’d at capital shareholders like We payable to dividend question-and-answer long outlook, the conference. XXXX. XXXX $X.XX of great August record our our share, business is of shareholders of July the to close term as of the on Operator? of Now business once Directors to common part quarter Given for fiscal a on grow proceed our to way over

Operator

take will NOBLE from Please a from We Instructions] Capital. [Operator Gomes ahead. question Joe go

Joe Gomes

my afternoon. Good taking for question. Thanks

the… On

Fred Kornberg

you? Hi, Joe. are How

Joe Gomes

Good.

the part the Next also mentioned you Hope one And and some Inc. here. Generation same. that XXX. are know negotiations as acquisition, well you’re quarter Quick large you I guys you of doing NGXXX, the for Last doing question We’re in multiyear order the that received from? from even on to this a market target a Are that also $XX get talking we’re of some talking contracts ones Illinois. bigger Is one that about? there Northern out awards there’s one that about looking said million you to you’re additional orders.

Fred Kornberg

Yes.

So, quarter, how to of contracts a even not running That’s car, high that’s double we’re that’s that you A multimillion-dollar of to with a that during that them very question, number the tell in it are double-digit coronavirus, to. referring we certainly finalization. and Joe. millions number – good near had couple the the folks being one multimillion the range. the There’s contracts close I state finalized. getting can around signatures, is and

pretty and good to feel finalized, contract done that the paperwork we So need things all to are but get going soon. announce get we the

Joe Gomes

got the Okay. Does sounds the to some also? again, ordered about you have fantastic. order. That maybe last the one, year, there go Army Army potentially and the opportunity get business now on But placed contract. talking and special you’re had you – ops back Great. lost give into we other this the COMET, Marines, the And

Fred Kornberg

guess, you It’s tropo a, small. extremely thin very, call what It’s low answer that ops in could I operations. is I’ll power, one. a line really extremely employable very COMET but special terminal. The

special So special almost That line. product it the past. – that, systems – we the a to supplied a in tropo really have notwithstanding large is it’s that it’s equivalent

we show demonstrated operations. So believe that – COMET effectively Army, the we actual and show will I be in that to see the they yes, to will them performance it certainly question, the actually we as will used that by answer your field

Joe Gomes

receive that from going you and one this you’ve talked in one in and releasing you some get been line. like et time? product, to had to And guys offices lately of back cetera, was But awards satellite but news. stations at last I’ll Again, one mean, point quarter, normal I that into in we how good couldn’t there’s a you jump there think no business number the sounds your me, especially That’s the about, releases. fair would to last of close still on. press are it in

Michael D. Porcelain

that. given applications the they let’s markets should comment sell, XG, other pretty there’s tremendous is point. do need the it early say, that way at market the for are it’s of come recovery end would the say backhaul cellular or are difficult Earlier for think same not can’t opened is, it’s that that’s think what activity now, first, we just in I to I And I some stages the the now. world. we there orders it. an right we’re I we around this activity. characterize we for placing is I seeing. in be I that to feel time, quarter, going I us relatively have the But right with the back customers to to around starting, of V There China are we many in the strongly world is a say still started that would are slow, guess, we’re opposed, the up, and the And one that in the but reopening quickly. at we see you them tell that like a us think and, pickup But types markets, that it’s and and L, about increased guess, strength a are U places think I’d seeing or China,

Joe Gomes

questions. the taking for Thanks Great.

Operator

We Chris question will from Quilty go Analytics. take from ahead. Quilty a Please

Chris Quilty

guys. Hi,

on any internal funding have from Or Just line? you that wanted line. to up COMET that development a product product development customer Was – do it? follow cost

Fred Kornberg

developed by No. It’s totally clients. been Comtech

we couple but Taken to the of and Army actually years, few just to demonstrated it past Marines months. a the us the in

Chris Quilty

tagged that just And separate it kind since that to can go Or period? have is a it’s contract entirely new, through specification some do available Or a on? for be of vehicle something contracting prospectively we and be long product line? might there

Fred Kornberg

interest we’re the number the a an think obviously. guess, at Army. with and to getting moment be the dealing have But I Army both and for I forces, I program ordering a, the special the expressed think actually large Marines

Michael D. Porcelain

Chris, deemphasize business. the very importantly And a we not to they that with special and ways to think market operations now, command. is have big there point. think, do I you this know a, Right

through other companies initial turned be modes, purchased. that Our we��re through communication getting for contracts, that allow that quick equipment orders is have acquisition rapid to

seeing So so and I them not a contract doing obstacle this There’s of out can and they’re not the that talking having ways we’re not government more guess an obstacle, here. the is There’s an there. main procure point vehicle to about we’re orders.

Chris Quilty

some one of their a And customers slowdown Great. a many believe, that, with other seeing for fact of or upon lot any customers, question. the defense expenditures? kind of funding tropo I you Are international related your dependent given those markets are energy

Fred Kornberg

the to similar very satellite very, international is market market. international the Certainly,

– seeing as as placed with usually these meetings and We face-to-face I get negotiations. are contracts mentioned mentioned, delays. are that Mike and We personal

So, to satellite the I very, think it’s area. similar very

Michael D. Porcelain

to of are don’t. prices of to We lot related the use these it the be lower Most we’re into oil the that But equipment the coronavirus to think markets are our and – of it. There’s reason, Chris that to cause their we oil, strictly business. delays these mistake end companies oil-producing would would sell as there it the not the And be serving. customers here out in other be delays. side the that of a a

space. customers key operations the are network mobile Our in

sold we’re of between contract. phases that over-the-horizon to the again, Algeria, we previously a in So business

is the driving So, it’s oil not – moment. delays of any not for the us at

Chris Quilty

mean, version? commentary lower-cost any on we product the on of that should line, product Heights a I given on any question either on, expect know everything customer line. you. acceptance, historic the Got product. new around And I forget I going don’t that the the developments name but

Michael D. Porcelain

but you Heights are think seeing. referring Yes. slowdown I Pico Chris, to lumped into it’s line, the of we’re kind the that

I more. that think it’s a are hearing test allowing sales one of the the from to team things that product customers lot our we is

folks the much bode happening So if that will good. instead this which networks, time what’s those tests spending a of that rolling is go good out it, testing ultimately lot is of more they’re actively –

So right stuff, the now nothing anything things have improve. again, for just the I but – don’t think to on Heights opportunities big there’s waiting to still we there, announce and they’re are

Chris Quilty

Are NGXXX Switching outlays thrown specific your identify being Lots gears to or of any over decisions? the accelerate customers’ government can or their there whatnot that ability government might around. or money either grants to benefit expand that you purchasing area.

Michael D. Porcelain

no. there’s would Many I guess, of projects end already with and yes this everybody’s our customers, a XXX bill. say charms on phone I appears there’s talking we’re that the that

So money. there some is XXX

On that states recognize budget lot the revenue. are on we They that money hand, state other out now having spent reductions constraints. a tax have of there are some some they’re coronavirus, the of income do of

cognizant we’re that. So, of

I have is we likely will customers hearing economy. a local when equipment back budget to we’re that going boost sit the that upgrades the from feedback access will there’s and be to they’ll federal most passed, on things and infrastructure think our and be and spend

increases important has market. to most the we everyone think to XXX citizens. faster. going go to the a bill will and anything, And more – are – to an – if this anything continues things infrastructure is how help employment, also that get solidify passed, and realize it’s XXX drive equipment tangible benefit is, picture, there out Upgrading it provides pandemic through and I definitely if things system definitely moving So money some potentially think big if

Chris Quilty

evenly Or across commercial heavily final sales where cost-cutting the Can side just you initiatives. either by perspective, you or folks mentioned quantify it and were fall, from or they help production of marketing? And these out some P&L perhaps board? was split more a on Understand. government or question,

Michael D. Porcelain

I I bore line discussed, product I as obviously, would satellite coronavirus. both brunt our it’s more the station mean, earth Fred say broad-based. and the of

So but you group, was broad-based. to this Doing it fun that a we cost could higher pretty it assume wasn’t percentage easy a do, is want in get into don’t specifics. to and during reductions that not activity but time was

Chris Quilty

you, Understand. Thank gentlemen.

Operator

a Latimore ahead. Northland take Capital. will go from We from Mike Please question

open. is line Your

Mike Latimore

you. Thank Great. Yes.

– it the what On just Inc. are assets NGXXX, technology, what the can bit there? there? of getting you’re acquiring sort XXX or services you a Is little acquisition, about talk you

Michael D. Porcelain

was do NGXXX in means it you the local of do get what town. really you stuff know as kind in remarks the local and And you the system. local who also distributor means The with installations mentioned done and prepared And do know-how how small know-how. where do is we the a Yes.

So a $XX that technology say, lot subsequently than of that’s awards to it in really was hard resulted make, I hard intangibles would nominal it why a for us we rather was, investment those million very equipment. or received. which contract And

Mike Latimore

know, closed then guess, some Got your I does don’t what on Clara it. quarter? a for during effect weeks. your – running? you the that everything I of, of I few Santa then And quarter, revenue up like is facility And the think kind and back have

Michael D. Porcelain

mode. the and I from We first of But Clara definitely mean, both And of out, think, that counties announcement, of were it local sort came the a some one shutdown to we definition the I overrode Yes. – that these issue – ordinances. week of sort and of in production any did. think, company this issued side. side about order U.S. of in the was eventually, thereafter, United shortly Defense Santa States essential when later, Department I

a couple in suppressed say we’re facility. the facilities the way, impacted is operating would Almost weeks at self-quarantine, is we capacity. not were time, that lost But the lower can really. at we’ve certainly we’re by and we I social implement accommodate flow, or as That been We think full the order since them I also able same flow separating case. form. moment, at all at the order production, to not of our implementing doing people, self-quarantine, of are distancing, best some of coronavirus So shape

Mike Latimore

on pushouts you spike pipeline Okay, bit this the I a expecting I mean, orders talked is you’re more spending think, U.S. a government, in about, little fiscal clear. but some projects And federal believe, bit year, at? then you looking the there, year-end the of are demand of in at least is the a little I from there. kind

Michael D. Porcelain

actually some letting Yes. made In X. do on on yes, the have the at bases they’re work until not that least government public announcements that short-term, folks the of July we grounds

would do and there’s that again, services normally an we field do. to inability certain support So

shifted the there. it’s to definitely But we going saw to So get right. delays

can’t And so already. is of some do. We in backlog that stuff

stuff lose at the the the not – of is the doesn’t money. like Some of of has day, end government to money. funded It’s government a And question money.

out year, some they’re figure to But that through do well to and in the QX that work as in expecting do customer. the And QX regulations. in has how of every and is to continuing we’re to expect some as we’re with trying what this county behind receive we logistics rules So, the every orders nice state yes, its own working XXXX. in deliveries in and short, do

Mike Latimore

more then just messaging It Has lot at And last given more. had home, influence just like text communicating there’s activity, it. staying of some any kind Got your I of seems messaging on that been one. a people guess business?

Michael D. Porcelain

with connected the down the said, there’s that our is to twice for make messaging system But to that not user, doubt. network in that pass work. been we categorize No had America And cost capability. connection were on Like – cost would very and is didn’t some sure FCC’s Keep what this us, there, Yes. type we end pledge, opportunities millions mobile passing the in our phone cell to operators trying I we’ve than right on had decided the I that very we to want processing in on high-margin critical people who normal. revenue

and felt And for critical most revenue during and work And opportunity increased be to But happening going there’s office. a I to incremental crisis. of get don’t what’s that piece think long think guess, to customers. at number at Now, I network technology. something be and the always needed to to time. think home, an its be going messaging, to it’s importantly, reopenings I will a certainly start these I’ve I back It’s around, come importantly, I some people that dead is some think some worth for is this proved infrastructure. the probably most us and going see – a from you people not these it there’s point. messaging That It’s text it’s drop going anywhere

Mike Latimore

lot. Thanks Great. a

Operator

a will ahead. from Research. go Please Singular Chris question We Sakai from take

open. is line Your

Chris Sakai

Hi, everyone.

that question. into running states that? mean, how a all? had you budgetary with are have dealt I mentioned affected Just you the you know Has I issues. guys that at some

Michael D. Porcelain

drove I the joke, signatures. some to to get we around county in state a particular try

funding, to So need the provide states do XXX services. obviously, funding to

So, getting it’s a of an order. part

We states don’t projects them. those are at hopefully, short safety forward deal projects, some with haven’t That’s We moment. we orientated. announced the with those their Chris, and And have delays. will issues budgets have why funding in their orders the seen These move the and allocate term.

and seeing for you’re space as purchasing responders states the ready down the think XXX I of to of mobilization masks try shifting see back forth, a the of you’ll to think I computers to wind get wave. and next sort healthcare hospitals, the these for So of networks so the money

Chris Sakai

was great. you I the book-to-bill ratio the then so And But Commercial your for – this. – light Okay, can don’t X.XX. if segment, some know shed on Solutions

idea current might land? book-to-bill or the quarter, in give wondering, can ratio in was guys Just ballpark, you this the where an

Michael D. Porcelain

For be think QX, it’s higher. we going to

for on growth we’d business, network think a to back that months. trailing station to X.X us, like the get operators earth backhaul mobile XX given requirements market a We it business have. it’s satellite Our cellular

business XXX basis. short-term is a like book-to-bill, that the we to this So a on would XXX, believe is

we things obviously, kind didn’t in given happen like to that’s But of where just coronavirus, go. QX. just So the

be we So, to is, QX. currently than think it I the best was say it’s in going higher can

Chris Sakai

Okay, Yes. all for that. thanks Well, right.

Michael D. Porcelain

Great.

Operator

turn And any time. the this I not questions we to do speakers. will back over have further at it

Fred Kornberg

to XXXX today. you you for very Thank the us much. again forward to look in you with fiscal call discuss And results. thank certainly Well, again we joining speaking our full-year

Operator

your you today’s program. participation. concludes This for Thank

disconnect may any time. at You

Comtech Telecommunications (CMTL) 3 Jun 202020 Q3 Earnings call transcript