cmtl-20220929
FALSECOMTECH TELECOMMUNICATIONS CORP /DE/000002319700000231972022-09-292022-09-29

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
September 29, 2022
0-7928
Date of Report
(Date of earliest event reported)
Commission File Number
(Exact name of registrant as specified in its charter)
Delaware11-2139466
(State or other jurisdiction of
incorporation or organization)

(I.R.S. Employer Identification Number)
68 South Service Road, Suite 230
Melville, New York 11747
(Address of Principal Executive Offices) (Zip Code)
(631) 962-7000
(Registrant’s telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of exchange on which registered
Common Stock, par value $0.10 per shareCMTLNasdaq Stock Market LLC

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
                                    Emerging growth company    ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.



Item 7.01    Regulation FD Disclosure

In the fourth quarter of fiscal 2022, Comtech Telecommunications Corp. (the "Company") re-organized its business segments to better align them with end-markets for its products and services. The Company's businesses have been re-organized into two new reportable segments: “Satellite and Space Communications” and “Terrestrial and Wireless Networks.”

Exhibit 99.1 sets forth an unaudited recast of historical quarterly segment financial information, which was previously reported in the Company's public filings with the Securities and Exchange Commission, to correspond with the Company's new reportable operating segments.

Such unaudited historical quarterly segment financial information is furnished herewith as Exhibit 99.1 and is incorporated herein by reference. The information in this Item 7.01 (including the exhibit hereto) relating to such unaudited historical quarterly segment financial information shall not be deemed filed under the Securities and Exchange Commission's rules and regulations and shall not be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended.

Information presented in this Current Report on Form 8-K does not reflect events occurring after the filing of Company's Annual Report on Form 10-K for the fiscal year ended July 31, 2022, and should be read in conjunction with the Company's previously filed Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q related to fiscal years 2022 and 2021, Current Reports on Form 8-K and the Company's subsequent filings with the Securities and Exchange Commission.

Item 9.01    Financial Statements and Exhibits.

(d) Exhibits.
Exhibit NumberDescription
104Cover Page Interactive Data File (embedded within the Inline XBRL Document)




SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, Comtech Telecommunications Corp. has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
COMTECH TELECOMMUNICATIONS CORP.
Dated:    September 29, 2022
By:        /s/ Michael A. Bondi    
Name:    Michael A. Bondi
Title:    Chief Financial Officer
            



COMTECH TELECOMMUNICATIONS CORP. AND SUBSIDIARIES
RECAST HISTORICAL QUARTERLY SEGMENT FINANCIAL INFORMATION
(unaudited)


Exhibit 99.1

Table of Contents

Page
Basis of Presentation2
Recast segment financial information for the:
Three months ended April 30, 20222
Nine months ended April 30, 20223
Three months ended January 31, 20223
Six months ended January 31, 20224
Three months ended October 31, 20214
Three months ended April 30, 20215
Nine months ended April 30, 20215
Three months ended January 31, 20216
Six months ended January 31, 20216
Three months ended October 31, 20207
















1
COMTECH TELECOMMUNICATIONS CORP. AND SUBSIDIARIES
RECAST HISTORICAL QUARTERLY SEGMENT FINANCIAL INFORMATION
(unaudited)


Basis of Presentation

In the fourth quarter of fiscal 2022, Comtech Telecommunications Corp. (the "Company") re-organized its business segments to better align them with end-markets for its products and services. The Company's businesses have been re-organized into two reportable segments: “Satellite and Space Communications” and “Terrestrial and Wireless Networks.”

The Company's chief operating decision maker ("CODM"), our Chief Executive Officer, primarily uses a metric that we refer to as Adjusted EBITDA to measure an operating segment’s performance and to make decisions about resources to be allocated. The Company's Adjusted EBITDA metric does not include any allocation of indirect expense, or any of the following: income taxes, interest (income) and other, change in fair value of the convertible preferred stock purchase option liability, write-off of deferred financing costs, interest expense, amortization of stock-based compensation, amortization of intangibles, depreciation expense, amortization of cost to fulfill assets, estimated contract settlement costs, settlement of intellectual property litigation, acquisition plan expenses, restructuring costs, COVID-19 related costs, strategic emerging technology costs (for next-generation satellite technology), facility exit costs, CEO transition costs, proxy solicitation costs, or strategic alternatives expenses and other. These items, while periodically affecting the Company's results, may vary significantly from period to period and may have a disproportionate effect in a given period, thereby affecting the comparability of results. Any amounts shown in the Adjusted EBITDA calculation for the Company's Satellite and Space Communications and Terrestrial and Wireless Networks segments are directly attributable to those segments. Adjusted EBITDA is also used by management in assessing the Company's operating results. Although closely aligned, the Company's definition of Adjusted EBITDA is different than the Consolidated EBITDA (as such term is defined in the Company's Credit Facility) utilized for financial covenant calculations and also may differ from the definition of EBITDA or Adjusted EBITDA used by other companies and, therefore, may not be comparable to similarly titled measures used by other companies.

The following schedules present the Company's unaudited historical quarterly segment information, which was recast to correspond with the Company’s current reporting structure, along with a reconciliation of segment net income and consolidated net income to Adjusted EBITDA:
  Three Months Ended April 30, 2022
Satellite and Space CommunicationsTerrestrial and Wireless Networks Unallocated Total
 Net sales$69,150,000 52,966,000 — $122,116,000 
 Operating (loss) income$(120,000)4,616,000 (5,062,000)$(566,000)
 Net income (loss)$297,000 4,502,000 (4,824,000)$(25,000)
Provision for (benefit from) income taxes59,000 98,000 (928,000)(771,000)
Interest (income) and other(454,000)16,000 (11,000)(449,000)
 Change in fair value of convertible preferred
     stock purchase option liability		— — (302,000)(302,000)
Interest expense(22,000)— 1,003,000 981,000 
Amortization of costs to fulfill assets233,000 — — 233,000 
Restructuring costs1,600,000 — — 1,600,000 
COVID-19 related costs115,000 — — 115,000 
Strategic emerging technology costs912,000 — — 912,000 
Amortization of stock-based compensation— — 1,071,000 1,071,000 
Amortization of intangibles1,828,000 3,521,000 — 5,349,000 
Depreciation846,000 1,588,000 48,000 2,482,000 
 Adjusted EBITDA$5,414,000 9,725,000 (3,943,000)$11,196,000 
 Purchase of property, plant and equipment$2,297,000 3,311,000 — $5,608,000 
 Total assets at April 30, 2022$485,620,000 469,075,000 28,942,000 $983,637,000 
2
COMTECH TELECOMMUNICATIONS CORP. AND SUBSIDIARIES
RECAST HISTORICAL QUARTERLY SEGMENT FINANCIAL INFORMATION
(unaudited)


  Nine Months Ended April 30, 2022
Satellite and Space CommunicationsTerrestrial and Wireless Networks Unallocated Total
 Net sales$202,890,000 156,366,000 — $359,256,000 
 Operating (loss) income$(7,933,000)17,574,000 (41,312,000)$(31,671,000)
 Net (loss) income$(7,285,000)17,445,000 (38,043,000)$(27,883,000)
(Benefit from) provision for income taxes(458,000)30,000 (5,672,000)(6,100,000)
Interest (income) and other(287,000)98,000 (71,000)(260,000)
Change in fair value of convertible preferred
     stock purchase option liability		— — (1,004,000)(1,004,000)
Amortization of cost to fulfill assets233,000 — — 233,000 
CEO transition costs— — 13,554,000 13,554,000 
Proxy solicitation costs— — 11,248,000 11,248,000 
Interest expense98,000 — 3,478,000 3,576,000 
Restructuring costs4,038,000 — — 4,038,000 
COVID-19 related costs1,144,000 — — 1,144,000 
Strategic emerging technology costs912,000 — — 912,000 
Amortization of stock-based compensation— — 3,975,000 3,975,000 
Amortization of intangibles5,484,000 10,563,000 — 16,047,000 
Depreciation2,444,000 4,462,000 151,000 7,057,000 
 Adjusted EBITDA$6,323,000 32,598,000 (12,384,000)$26,537,000 
 Purchase of property, plant and equipment$6,522,000 7,898,000 — $14,420,000 
 Total assets at April 30, 2022$485,620,000 469,075,000 28,942,000 $983,637,000 
  Three Months Ended January 31, 2022
Satellite and Space CommunicationsTerrestrial and Wireless Networks Unallocated Total
 Net sales$69,180,000 51,201,000 — $120,381,000 
 Operating (loss) income$(2,500,000)6,856,000 (28,946,000)$(24,590,000)
 Net (loss) income$(2,508,000)6,965,000 (26,331,000)$(21,874,000)
Provision for (benefit from) income taxes82,000 (209,000)(3,149,000)(3,276,000)
Interest (income) and other(80,000)100,000 (50,000)(30,000)
Interest expense6,000 — 982,000 988,000 
Amortization of stock-based compensation— — 1,983,000 1,983,000 
Amortization of intangibles1,828,000 3,521,000 — 5,349,000 
Depreciation773,000 1,510,000 51,000 2,334,000 
CEO transition costs— — 13,554,000 13,554,000 
Change in fair value of convertible preferred
     stock purchase option liability		— — (398,000)(398,000)
Restructuring costs1,726,000 — — 1,726,000 
COVID-19 related costs355,000 — — 355,000 
Proxy solicitation costs— — 9,086,000 9,086,000 
 Adjusted EBITDA$2,182,000 11,887,000 (4,272,000)$9,797,000 
Purchase of property, plant and equipment$3,187,000 1,986,000 — $5,173,000 
 Total assets at January 31, 2022$482,989,000 485,155,000 26,710,000 $994,854,000 

3
COMTECH TELECOMMUNICATIONS CORP. AND SUBSIDIARIES
RECAST HISTORICAL QUARTERLY SEGMENT FINANCIAL INFORMATION
(unaudited)


  Six Months Ended January 31, 2022
Satellite and Space CommunicationsTerrestrial and Wireless Networks Unallocated Total
 Net sales$133,740,000 103,400,000 — $237,140,000 
 Operating (loss) income$(7,813,000)12,958,000 (36,250,000)$(31,105,000)
 Net (loss) income$(7,582,000)12,943,000 (33,219,000)$(27,858,000)
(Benefit from) provision for income taxes(517,000)(68,000)(4,744,000)(5,329,000)
Interest (income) and other167,000 82,000 (60,000)189,000 
Change in fair value of convertible preferred
     stock purchase option liability		— — (702,000)(702,000)
Interest expense120,000 — 2,475,000 2,595,000 
Amortization of stock-based compensation— — 2,904,000 2,904,000 
Amortization of intangibles3,656,000 7,042,000 — 10,698,000 
Depreciation1,598,000 2,874,000 103,000 4,575,000 
CEO transition costs— — 13,554,000 13,554,000 
Proxy solicitation costs— — 11,248,000 11,248,000 
Restructuring costs2,438,000 — — 2,438,000 
COVID-19 related costs1,029,000 — — 1,029,000 
 Adjusted EBITDA$909,000 22,873,000 (8,441,000)$15,341,000 
Purchase of property, plant and equipment$4,224,000 4,587,000 — $8,811,000 
 Total assets at January 31, 2022$482,989,000 485,155,000 26,710,000 $994,854,000 
  Three Months Ended October 31, 2021
Satellite and Space CommunicationsTerrestrial and Wireless Networks Unallocated Total
 Net sales$64,560,000 52,199,000 — $116,759,000 
 Operating (loss) income$(5,313,000)6,102,000 (7,304,000)$(6,515,000)
 Net (loss) income$(5,074,000)5,978,000 (6,888,000)$(5,984,000)
(Benefit from) provision for income taxes(599,000)141,000 (1,595,000)(2,053,000)
Interest (income) and other247,000 (18,000)(10,000)219,000 
Change in fair value of convertible preferred
     stock purchase option liability		— — (304,000)(304,000)
Interest expense114,000 — 1,493,000 1,607,000 
Amortization of stock-based compensation— — 921,000 921,000 
Amortization of intangibles1,828,000 3,521,000 — 5,349,000 
Depreciation825,000 1,364,000 52,000 2,241,000 
Proxy solicitation costs— — 2,162,000 2,162,000 
Restructuring costs712,000 — — 712,000 
COVID-19 related costs674,000 — — 674,000 
 Adjusted EBITDA$(1,273,000)10,986,000 (4,169,000)$5,544,000 
Purchase of property, plant and equipment$1,037,000 2,601,000 — $3,638,000 
 Total assets at October 31, 2021$485,087,000 471,858,000 26,044,000 $982,989,000 
4
COMTECH TELECOMMUNICATIONS CORP. AND SUBSIDIARIES
RECAST HISTORICAL QUARTERLY SEGMENT FINANCIAL INFORMATION
(unaudited)


  Three Months Ended April 30, 2021
Satellite and Space CommunicationsTerrestrial and Wireless Networks Unallocated Total
 Net sales$83,340,000 56,036,000 — $139,376,000 
 Operating income (loss)$3,093,000 6,993,000 (7,736,000)$2,350,000 
 Net income (loss)$3,041,000 6,731,000 (8,980,000)$792,000 
(Benefit from) provision for income taxes(77,000)294,000 99,000 316,000 
Interest (income) and other126,000 (32,000)(370,000)(276,000)
Interest expense3,000 — 1,515,000 1,518,000 
Amortization of stock-based compensation— — 1,204,000 1,204,000 
Amortization of intangibles1,648,000 3,662,000 — 5,310,000 
Depreciation907,000 1,311,000 56,000 2,274,000 
Acquisition plan expenses— — 5,267,000 5,267,000 
Restructuring costs594,000 — — 594,000 
COVID-19 related costs416,000 — — 416,000 
Strategic emerging technology costs315,000 — — 315,000 
 Adjusted EBITDA$6,973,000 11,966,000 (1,209,000)$17,730,000 
Purchase of property, plant and equipment$2,168,000 2,380,000 3,000 $4,551,000 
 Long-lived assets acquired in connection with
     acquisitions		$45,597,000 — — $45,597,000 
 Total assets at April 30, 2021$482,370,000 477,285,000 38,937,000 $998,592,000 

  Nine Months Ended April 30, 2021
Satellite and Space CommunicationsTerrestrial and Wireless Networks Unallocated Total
 Net sales$282,775,000 153,111,000 — $435,886,000 
 Operating income (loss)$16,809,000 19,443,000 (114,216,000)$(77,964,000)
 Net income (loss)$16,985,000 18,771,000 (116,599,000)$(80,843,000)
(Benefit from) provision for income taxes(431,000)792,000 (2,439,000)(2,078,000)
Interest (income) and other188,000 (120,000)(344,000)(276,000)
Interest expense67,000 — 5,166,000 5,233,000 
Amortization of stock-based compensation— — 3,190,000 3,190,000 
Amortization of intangibles3,867,000 11,804,000 — 15,671,000 
Depreciation2,973,000 4,021,000 289,000 7,283,000 
Acquisition plan expenses— (1,052,000)100,859,000 99,807,000 
Restructuring costs1,195,000 — — 1,195,000 
COVID-19 related costs576,000 — — 576,000 
Strategic emerging technology costs315,000 — — 315,000 
 Adjusted EBITDA$25,735,000 34,216,000 (9,878,000)$50,073,000 
Purchase of property, plant and equipment$4,296,000 3,858,000 83,000 $8,237,000 
 Long-lived assets acquired in connection with
     acquisitions		$48,040,000 — — $48,040,000 
 Total assets at April 30, 2021$482,370,000 477,285,000 38,937,000 $998,592,000 

5
COMTECH TELECOMMUNICATIONS CORP. AND SUBSIDIARIES
RECAST HISTORICAL QUARTERLY SEGMENT FINANCIAL INFORMATION
(unaudited)


  Three Months Ended January 31, 2021
Satellite and Space CommunicationsTerrestrial and Wireless Networks Unallocated Total
 Net sales$113,650,000 47,642,000 — $161,292,000 
 Operating income (loss)$10,339,000 4,492,000 (9,429,000)$5,402,000 
 Net income (loss)$10,464,000 4,514,000 (10,773,000)$4,205,000 
(Benefit from) provision for income taxes(194,000)125,000 (86,000)(155,000)
Interest (income) and other66,000 (148,000)16,000 (66,000)
Interest expense4,000 — 1,414,000 1,418,000 
Amortization of stock-based compensation— — 1,287,000 1,287,000 
Amortization of intangibles724,000 4,071,000 — 4,795,000 
Depreciation1,052,000 1,325,000 80,000 2,457,000 
Acquisition plan expenses— — 3,357,000 3,357,000 
Restructuring costs601,000 — — 601,000 
COVID-19 related costs160,000 — — 160,000 
 Adjusted EBITDA$12,877,000 9,887,000 (4,705,000)$18,059,000 
Purchase of property, plant and equipment$1,674,000 1,122,000 — $2,796,000 
 Total assets at January 31, 2021$441,991,000 470,836,000 33,768,000 $946,595,000 

  Six Months Ended January 31, 2021
Satellite and Space CommunicationsTerrestrial and Wireless Networks Unallocated Total
 Net sales199,435,000 $97,075,000 — $296,510,000 
 Operating income (loss)13,716,000 $12,450,000 (106,480,000)$(80,314,000)
 Net income (loss)13,944,000 $12,040,000 (107,619,000)$(81,635,000)
(Benefit from) provision for income taxes(354,000)498,000 (2,538,000)(2,394,000)
Interest (income) and other62,000 (88,000)26,000 — 
Interest expense64,000 — 3,651,000 3,715,000 
Amortization of stock-based compensation— — 1,986,000 1,986,000 
Amortization of intangibles2,219,000 8,142,000 — 10,361,000 
Depreciation2,066,000 2,710,000 233,000 5,009,000 
Acquisition plan expenses— (1,052,000)95,592,000 94,540,000 
Restructuring costs601,000 — — 601,000 
COVID-19 related costs160,000 — — 160,000 
 Adjusted EBITDA18,762,000 $22,250,000 (8,669,000)$32,343,000 
Purchase of property, plant and equipment2,128,000 $1,478,000 80,000 $3,686,000 
 Total assets at January 31, 2021441,991,000 $470,836,000 33,768,000 $946,595,000 

6
COMTECH TELECOMMUNICATIONS CORP. AND SUBSIDIARIES
RECAST HISTORICAL QUARTERLY SEGMENT FINANCIAL INFORMATION
(unaudited)


  Three Months Ended October 31, 2020
Satellite and Space CommunicationsTerrestrial and Wireless Networks Unallocated Total
 Net sales$85,785,000 49,433,000 — $135,218,000 
 Operating income (loss)$3,377,000 7,958,000 (97,051,000)$(85,716,000)
 Net income (loss)$3,480,000 7,526,000 (96,846,000)$(85,840,000)
(Benefit from) provision for income taxes(160,000)373,000 (2,452,000)(2,239,000)
Interest (income) and other(4,000)60,000 10,000 66,000 
Interest expense60,000 — 2,237,000 2,297,000 
Amortization of stock-based compensation— — 699,000 699,000 
Amortization of intangibles1,495,000 4,071,000 — 5,566,000 
Depreciation1,014,000 1,385,000 153,000 2,552,000 
Acquisition plan expenses— (1,052,000)92,235,000 91,183,000 
 Adjusted EBITDA$5,885,000 12,363,000 (3,964,000)$14,284,000 
Purchase of property, plant and equipment$454,000 356,000 80,000 $890,000 
 Total assets at October 31, 2020$419,165,000 465,271,000 34,075,000 $918,511,000 

















7