MELVILLE, N.Y., Mar 9, 2009 (GlobeNewswire via COMTEX News Network) -- Comtech Telecommunications Corp. (Nasdaq:CMTL) today reported its operating results for the three and six months ended January 31, 2009.

Net sales for the second quarter of fiscal 2009 were $143.9 million compared to $152.0 million for the second quarter of fiscal 2008, reflecting incremental sales in all three of our business segments associated with the Radyne acquisition and core organic growth in our telecommunications transmission and RF microwave amplifiers segments, all of which was offset by an expected significant decrease in net sales in our mobile data communications segment.

GAAP net income was $12.8 million, or $0.46 per diluted share, for the three months ended January 31, 2009 compared to $25.5 million, or $0.91 per diluted share, for the three months ended January 31, 2008. Non-GAAP net income for the three months ended January 31, 2009, which excludes the amortization of stock-based compensation expense, was $14.3 million, or $0.51 per diluted share, as compared to Non-GAAP net income of $27.1 million, or $0.96 per diluted share, for the three months ended January 31, 2008.

Net sales for the six months ended January 31, 2009 were $335.8 million compared to $267.1 million for the six months ended January 31, 2008. GAAP net income was $35.2 million, or $1.26 per diluted share, for the six months ended January 31, 2009 compared to $40.2 million, or $1.45 per diluted share, for the six months ended January 31, 2008. GAAP net income for the six months ended January 31, 2009 has been reduced by a one-time charge of $6.2 million ($0.22 per diluted share) for the amortization of acquired in-process research and development associated with the Radyne acquisition. Non-GAAP net income for the six months ended January 31, 2009, which excludes the amortization of stock-based compensation expense and amortization of acquired in-process research and development, was $44.5 million, or $1.58 per diluted share, as compared to Non-GAAP net income of $43.6 million, or $1.56 per diluted share, for the six months ended January 31, 2008.

In commenting on the Company's performance during the second quarter of fiscal 2009, Fred Kornberg, President and Chief Executive Officer, stated, "Despite difficult market conditions, our second quarter results were in-line with our expectations. We continue to benefit from our strong leadership positions in the markets we serve, the differentiated and compelling value of our products, and the benefits we are generating from the Radyne acquisition."

Mr. Kornberg added, "Although business conditions are much more challenging than they were just a few months ago, we believe our overall business momentum will continue and drive growth into fiscal 2010."

Selected Fiscal 2009 Second Quarter Financial Metrics and Other Items

 * Bookings for the three and six months ended January 31, 2009 were a
   record $386.9 million and $545.5 million, respectively, compared to
   $122.3 million and $357.3 million for the three and six months
   ended January 31, 2008, respectively. Backlog as of January 31,
   2009 was $462.1 million compared to $201.1 million as of July 31,
   2008 and $219.2 million as of January 31, 2008.

 * Earnings before interest, taxes, depreciation and amortization,
   including amortization of acquired in-process research and
   development ("EBITDA"), were $27.1 million and $77.1 million for
   the three and six months ended January 31, 2009, respectively,
   versus $40.7 million and $64.6 million for the three and six months
   ended January 31, 2008, respectively.

 * Net cash provided by operating activities was $24.4 million for the
   six months ended January 31, 2009 compared to net cash used in
   operating activities of $1.0 million for the six months ended
   January 31, 2008. The net increase in cash provided by operating
   activities was primarily driven by a significant decrease in net
   working capital requirements during the six months ended January
   31, 2009 as compared to the six months ended January 31, 2008.

 * Interest income and other was $0.6 million and $1.9 million for the
   three and six months ended January 31, 2009, respectively, as
   compared to $4.1 million and $8.5 million for the three and six
   months ended January 31, 2008, respectively. The decrease in
   interest income was primarily due to the significant reduction in
   our cash and cash equivalents primarily driven by payments relating
   to the August 1, 2008 acquisition of Radyne and the significant
   period-over-period decline in interest rates.

 * As of February 12, 2009, all of our outstanding $105.0 million 2.0%
   Convertible Senior Notes were fully converted by noteholders into
   an aggregate of 3,333,327 shares of our common stock, plus cash in
   lieu of fractional shares. As such, we currently have no long-term
   debt.

 * Our effective tax rate for the three months ended January 31, 2009
   and 2008 reflects discrete tax benefits of $0.3 million and $0.2
   million, respectively. Excluding discrete items in both periods,
   our estimated effective tax rate for the three months ended January
   31, 2009 was 34.5% as compared to 34.75% for the three months ended
   January 31, 2008. This decrease is primarily attributable to the
   retroactive extension of the Federal research and experimentation
   credit from December 31, 2007 through December 31, 2009. Our
   effective tax rate for fiscal 2009, excluding the amortization of
   acquired in-process research and development and the discrete tax
   benefits recorded, is expected to approximate 34.5%.

Conference Call

The Company has scheduled an investor conference call for 8:30 AM (ET) on Tuesday, March 10, 2009. 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) 220-0874. In addition, an updated investor presentation, including earnings guidance, will be available on our web site shortly after the conference call.

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 or ineffective. 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, 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 timing of receipt of, and the Company's performance on, new 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 Department of Defense subpoenas, and other factors described in the Company's filings with the Securities and Exchange Commission.

                   COMTECH TELECOMMUNICATIONS CORP.
                           AND SUBSIDIARIES
            Condensed Consolidated Statements of Operations
                              (Unaudited)

                      Three months ended         Six months ended
                         January 31,                January 31,
                  ------------------------- -------------------------
                      2009         2008         2009          2008
                  ------------ ------------ ------------ ------------

 Net sales        $143,886,000  152,030,000  335,801,000  267,085,000
 Cost of sales      84,409,000   85,705,000  189,345,000  150,282,000
                  ------------ ------------ ------------ ------------
   Gross profit     59,477,000   66,325,000  146,456,000  116,803,000
                  ------------ ------------ ------------ ------------

 Expenses:
  Selling,
   general and
   administrative   25,969,000   21,304,000   54,947,000   41,703,000
   Research and
    development     12,522,000    9,140,000   26,647,000   20,181,000
   Amortization
    of acquired
    in-process
    research and
    development             --           --    6,200,000           --
   Amortization
    of
    intangibles      1,796,000      434,000    3,589,000      813,000
                  ------------ ------------ ------------ ------------
                    40,287,000   30,878,000   91,383,000   62,697,000
                  ------------ ------------ ------------ ------------

 Operating income   19,190,000   35,447,000   55,073,000   54,106,000

 Other expenses
  (income):
   Interest
    expense            711,000      670,000    1,377,000    1,347,000
   Interest
    income and
    other             (626,000)  (4,095,000)  (1,903,000)  (8,542,000)
                  ------------ ------------ ------------ ------------

 Income before
  provision for
  income taxes      19,105,000   38,872,000   55,599,000   61,301,000
 Provision for
  income taxes       6,265,000   13,403,000   20,388,000   21,138,000
                  ------------ ------------ ------------ ------------

 Net income       $ 12,840,000   25,469,000   35,211,000   40,163,000
                  ============   ==========  ===========   ==========

 Net income per
  share:
   Basic          $       0.52         1.06         1.43         1.67
                  ============ ============ ============ ============
   Diluted        $       0.46         0.91         1.26         1.45
                  ============ ============ ============ ============

 Weighted
  average number
  of common
  shares
  outstanding -
  basic             24,759,000   24,099,000   24,673,000   24,012,000
                  ============ ============ ============ ============

 Weighted
  average number
  of common and
  common
  equivalent
  shares
  outstanding
  assuming
  dilution -
  diluted           28,633,000   28,303,000   28,585,000   28,256,000
                  ============ ============ ============ ============


                   COMTECH TELECOMMUNICATIONS CORP.
                           AND SUBSIDIARIES
                 Condensed Consolidated Balance Sheets

                                             January 31,    July 31,
                                               2009           2008
                                            ------------ ------------
                       Assets                (Unaudited)   (Audited)
 Current assets:
   Cash and cash equivalents                $232,207,000  410,067,000
   Accounts receivable, net                   95,672,000   70,040,000
   Inventories, net                          111,622,000   85,966,000
   Prepaid expenses and other current
    assets                                    12,041,000    5,891,000
   Deferred tax asset                         17,297,000   10,026,000
                                            ------------ ------------
          Total current assets               468,839,000  581,990,000

 Property, plant and equipment, net           39,433,000   34,269,000
 Goodwill                                    147,677,000   24,363,000
 Intangibles with finite lives, net           59,275,000    7,505,000
 Deferred financing costs, net                 1,080,000    1,357,000
 Other assets, net                               708,000    3,636,000
                                            ------------ ------------
          Total assets                      $717,012,000  653,120,000
                                            ============ ============

          Liabilities and Stockholders'
           Equity

 Current liabilities:
   Accounts payable                         $ 22,588,000   31,423,000
   Accrued expenses and other current
    liabilities                               48,238,000   49,671,000
   Customer advances and deposits             17,514,000   15,287,000
   Current installments of other
    obligations                                   37,000      108,000
   Interest payable                            1,050,000    1,050,000
                                            ------------ ------------
          Total current liabilities           89,427,000   97,539,000

 Convertible senior notes                    104,616,000  105,000,000
 Other liabilities                             2,480,000           --
 Income taxes payable                          3,714,000    1,909,000
 Deferred tax liability                       22,464,000    5,870,000
                                            ------------ ------------
          Total liabilities                  222,701,000  210,318,000

 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
    25,017,923 shares and 24,600,166
    shares at January 31, 2009 and
    July 31, 2008, respectively                2,502,000    2,460,000
   Additional paid-in capital                202,502,000  186,246,000
   Retained earnings                         289,492,000  254,281,000
                                            ------------ ------------
                                             494,496,000  442,987,000
     Less:
       Treasury stock (210,937 shares)          (185,000)    (185,000)
                                            ------------ ------------
         Total stockholders' equity          494,311,000  442,802,000
                                            ------------ ------------
         Total liabilities and
          stockholders' equity              $717,012,000  653,120,000
                                            ============ ============


                   COMTECH TELECOMMUNICATIONS CORP.
                           AND SUBSIDIARIES
    Reconciliation of Non-GAAP Financial Measures to GAAP Financial
                               Measures
                              (Unaudited)

                     Three Months Ended          Six Months Ended
                        January 31,                January 31,
                  ------------------------- -------------------------
                      2009         2008         2009         2008
                  ------------ ------------ ------------ ------------
 Reconciliation
  of Non-GAAP
  Net Income to
  GAAP Net
  Income(1):
   Non-GAAP net
    income        $ 14,294,000   27,133,000   44,501,000   43,605,000
   Amortization
    of acquired
    in-process
    research and
    development             --           --   (6,200,000)          --
   Amortization
    of stock-
    based
    compensation    (2,292,000)  (2,552,000)  (4,710,000)  (5,271,000)
   Tax effect of
    stock-based
    compensation
    expense            838,000      888,000    1,620,000    1,829,000
                  ------------ ------------ ------------ ------------
   GAAP net
    income        $ 12,840,000   25,469,000   35,211,000   40,163,000
                  ============ ============ ============ ============

 Reconciliation
  of Non-GAAP
  Diluted
  Earnings Per
  Share to GAAP
  Diluted
  Earnings
  Per Share(1):
   Non-GAAP
    diluted
    earnings
    per share     $       0.51         0.96         1.58         1.56
   Amortization
    of acquired
    in-process
    research and
    development             --           --        (0.22)          --
   Amortization
    of stock-
    based
    compensation         (0.08)       (0.08)       (0.16)       (0.16)
   Tax effect of
    stock-based
    compensation
    expense               0.03         0.03         0.06         0.05
                  ------------ ------------ ------------ ------------
   GAAP diluted
    earnings per
    share         $       0.46         0.91         1.26         1.45
                  ============ ============ ============ ============

 Reconciliation
  of GAAP Net
  Income to
  EBITDA(2):
   GAAP net
    income        $ 12,840,000   25,469,000   35,211,000   40,163,000
   Income taxes      6,265,000   13,403,000   20,388,000   21,138,000
   Net interest
    expense
    (income) and
    other               85,000   (3,425,000)    (526,000)  (7,195,000)
   Amortization
    of acquired
    in-process
    research and
    development             --           --    6,200,000           --
   Amortization
    of stock-
    based
    compensation     2,292,000    2,552,000    4,710,000    5,271,000
   Depreciation
    and other
    amortization     5,608,000    2,693,000   11,074,000    5,184,000
                  ------------ ------------ ------------ ------------
   EBITDA         $ 27,090,000   40,692,000   77,057,000   64,561,000
                  ============ ============ ============ ============

 (1) Non-GAAP net income is used by management in assessing the
     Company's operating results. The Company believes that investors
     and analysts may use non-GAAP measures that exclude the
     amortization of acquired in-process research and development and
     stock-based compensation, along with other information contained
     in its SEC filings, in assessing the Company's operating results.

 (2) 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 and ability to meet debt service
     requirements. 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

This news release was distributed by GlobeNewswire, www.globenewswire.com

SOURCE: Comtech Telecommunications Corp.

Comtech Telecommunications Corp.
          Media Contacts:
          Michael D. Porcelain, Senior Vice President and 
           Chief Financial Officer
         

^© Copyright 2009 GlobeNewswire, Inc. All rights reserved.

News Provided by COMTEX