<PAGE>
FORM 10-Q QUARTERLY REPORT UNDER SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
(As last amended in Rel. No. 34-26589, eff. 4/12/89)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20459
Form 10-Q
(Mark One)
(X) Quarterly Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the period ended January 31, 1996
----------------------------------------------
( ) Transition Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the transition period from _________________ to _______________
Commission File Number: 0-7928
---------------------
COMTECH TELECOMMUNICATIONS CORP.
-----------------------------------------------------
(Exact name of registrant as
specified in its charter)
Delaware 11-2139466
- ----------------------------------------------------- ------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
105 Baylis Road, Melville, New York 11747
- ----------------------------------------------------- -------------------------
(Address of principal executive offices) (Zip Code)
(516) 777-8900
-------------------------------------------------------------------------------
(Registrant's telephone number, including area code)
-------------------------------------------------------------------------------
(Former name, former address and former fiscal year, if changed since last
report)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.
(X) Yes ( ) No
APPLICABLE ONLY TO ISSUERS INVOLVED
IN BANKRUPTCY PROCEEDING DURING
THE PRECEDING FIVE YEARS
Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Sections 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a
plan confirmed by a court.
( ) Yes ( ) No
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date.
Common Stock, Par Value $.10 Per Share - 2,605,344 shares outstanding as
------------------------------------------------------------------------
of 01/31/96.
- ------------
<PAGE>
-2-
COMTECH TELECOMMUNICATIONS CORP.
--------------------------------
INDEX
-----
Page
No.
----
PART I FINANCIAL INFORMATION
Consolidated Balance Sheets - 3
January 31, 1996 (unaudited) and
July 31, 1995
Consolidated Statements of Operations - 4
Three Months and Six Months Ended
January 31, 1996 and 1995 (unaudited)
Consolidated Statements of Cash Flows 5
Six Months Ended January 31, 1996 and 1995
(unaudited)
Notes to Consolidated Financial Statements 6-8
Management's Discussion and Analysis of
Financial Condition and Results of Operations 9-12
PART II OTHER INFORMATION 13
Exhibit 11.0 Computation of Income (Loss) Per
Common Share 14
Signature Page 15
<PAGE>
-3-
<TABLE>
<CAPTION>
PART I
------
FINANCIAL INFORMATION
---------------------
COMTECH TELECOMMUNICATIONS CORP. AND SUBSIDIARIES
-------------------------------------------------
CONSOLIDATED BALANCE SHEETS
---------------------------
January 31, July 31,
1996 1995
----------- ------------
(unaudited)
ASSETS:
<S> <C> <C>
Current assets:
Cash and cash equivalents $ 907,000 $ 2,019,000
Restricted cash 477,000 25,000
Marketable investment securities - 275,000
Accounts receivable, less allowance
for doubtful accounts of $58,000 at
January 31, 1996 and $137,000 at
July 31, 1995 4,656,000 4,490,000
Inventories, net 5,981,000 5,011,000
Prepaid expenses and other current
assets 353,000 286,000
------------ ------------
Total current assets 12,374,000 12,106,000
Property, plant and equipment, net 4,078,000 4,212,000
Other assets 442,000 465,000
------------ ------------
Total Assets $ 16,894,000 $ 16,783,000
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current installments of long-term debt
(including payable to related party of
$334,000 at January 31, 1996 and $319,000
at July 31, 1995) $ 588,000 $ 591,000
Notes payable 250,000 250,000
Accounts payable 1,739,000 1,894,000
Accrued expenses and other current
liabilities 2,211,000 1,690,000
------------ ------------
Total current liabilities 4,788,000 4,425,000
------------ ------------
Long-term debt, less current installments
(including payable to related party of
$1,692,000 at January 31, 1996 and
$1,862,000 at July 31, 1995) 2,091,000 2,277,000
------------ ------------
Total Liabilities 6,879,000 6,702,000
Stockholders' equity:
Preferred stock, par value $.10 per
share; shares authorized and unissued
2,000,000 - -
Common stock, par value $.10 per share;
authorized 10,000,000 shares; issued and
outstanding, 2,605,344 shares at January
31, 1996 and July 31, 1995 261,000 261,000
Additional paid-in capital 22,230,000 22,230,000
Accumulated deficit (11,812,000) (11,671,000)
------------ ------------
10,679,000 10,820,000
Less:
Treasury stock (15,000 shares) (180,000) (180,000)
Deferred compensation expense (481,000) (553,000)
Unrealized loss on securities (3,000) (6,000)
------------ ------------
10,015,000 10,081,000
------------ ------------
Total liabilities and stockholders' equity $ 16,894,000 $ 16,783,000
============ ============
</TABLE>
See accompanying notes to consolidated financial statements
<PAGE>
-4-
<TABLE>
<CAPTION>
COMTECH TELECOMMUNICATIONS CORP. AND SUBSIDIARIES
-------------------------------------------------
CONSOLIDATED STATEMENTS OF OPERATIONS
-------------------------------------
Three Months Ended Six Months Ended
January 31, January 31,
-------------------------- --------------------------
1996 1995 1996 1995
---------- ---------- ---------- ----------
Unaudited Unaudited Unaudited Unaudited
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Net sales $4,747,000 $4,099,000 $9,203,000 $7,041,000
---------- ---------- ---------- ----------
Operating costs and expenses:
Cost of sales 3,313,000 3,019,000 6,455,000 5,110,000
Selling, general and
administrative 1,163,000 1,171,000 2,367,000 2,307,000
Research and development 157,000 265,000 392,000 450,000
---------- ---------- ---------- ----------
Total operating costs and
expenses 4,633,000 4,455,000 9,214,000 7,867,000
---------- ---------- ---------- ----------
Operating earnings (loss) 114,000 (356,000) (11,000) (826,000)
Other expenses (income):
Interest expense 86,000 84,000 157,000 154,000
Interest income (20,000) (46,000) (37,000) (96,000)
---------- ---------- ---------- ----------
Earnings (loss) from
operations before provision
for income taxes 48,000 (394,000) (131,000) (884,000)
Provision for income taxes 3,000 4,000 10,000 8,000
---------- ---------- ---------- ----------
Net income (loss) $ 45,000 $ (398,000) $ (141,000) $ (892,000)
========== ========== ========== ==========
Earnings (loss) per share $.02 $(.15) $(.05) (.34)
========== ========== ========== ==========
Weighted average number of
common and common equivalent
shares outstanding 2,590,344 2,590,344 2,590,344 2,590,344
========== ========== ========== ==========
</TABLE>
See accompanying notes to consolidated financial statements
<PAGE>
-5-
<TABLE>
<CAPTION>
COMTECH TELECOMMUNICATIONS CORP. AND SUBSIDIARIES
-------------------------------------------------
CONSOLIDATED STATEMENTS OF CASH FLOWS
-------------------------------------
Six Months Ended
January 31,
-----------------
(unaudited)
1996 1995
---------- -----------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $ (141,000) $ (892,000)
Adjustments to reconcile net loss
to net cash used in operating activities:
Depreciation and amortization 482,000 361,000
Amortization of deferred compensation 72,000 72,000
Changes in assets and liabilities:
Accounts receivable (166,000) (54,000)
Inventories (970,000) (872,000)
Prepaid expenses and other current
assets (67,000) (175,000)
Other assets (17,000) 34,000
Accounts payable (155,000) 153,000
Accrued expenses and other current
liabilities 521,000 (508,000)
---------- -----------
Net cash used in operating activities (441,000) (1,881,000)
---------- -----------
Cash flows from investing activities:
Purchases of property, plant and equipment (148,000) (139,000)
Net proceeds of sales of marketable securities 278,000 4,083,000
---------- -----------
Net cash provided by
investing activities 130,000 3,944,000
---------- -----------
Cash flows from financing activities:
Principal payments on long-term debt (349,000) (266,000)
---------- -----------
Net cash used in financing
activities (349,000) (266,000)
---------- -----------
Net decrease (increase) in cash and cash
equivalents (660,000) 1,797,000
Cash and cash equivalents at beginning of
period 2,044,000 505,000
---------- -----------
Cash and cash equivalents at end of period $1,384,000 $ 2,302,000
========== ===========
Supplemental cash flow disclosure:
- ---------------------------------
Cash paid during the period for:
Interest $ 157,000 $ 154,000
Income taxes $ 10,000 $ 0
</TABLE>
See accompanying notes to consolidated financial statements
<PAGE>
-6-
COMTECH TELECOMMUNICATIONS CORP. AND SUBSIDIARIES
-------------------------------------------------
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
------------------------------------------
(1) General
The accompanying consolidated financial statements for the six months ended
January 31, 1996 and 1995 are unaudited. In the opinion of management, the
information furnished reflects all adjustments, consisting only of normal
recurring adjustments, necessary for a fair presentation of the results for the
unaudited interim periods. The results of operations for the six months ended
January 31, 1996 are not necessarily indicative of the results of operations to
be expected for the full year.
(2) Marketable Investment Securities
At January 31, 1996, investments are comprised principally of commercial
debt obligations and United States Treasury obligations. The Company utilizes
the services of a financial institution to administer its cash management short
term investment program within parameters established by the Company. The
Registrant classifies its debt and marketable equity securities as available-
for-sale securities that are principally being held for an unspecified period of
time, as such, the Registrant may consider selling them to meet liquidity needs
or as part of the Registrant's risk management program.
Available-for-sale securities are recorded at fair value. Dividend and
interest income are recognized when earned. Realized gains and losses are
included in earnings and are derived using the specific identification method
for determining the cost of securities sold. Unrealized gains and losses are
excluded from earnings and are reported as a separate component of stockholders'
equity until realized.
(3) Accounts Receivable
<TABLE>
<CAPTION>
Accounts receivable consist of the following:
January 31, July 31,
1996 1995
---------- ---------
<S> <C> <C>
Accounts receivable from commercial
customers $3,377,000 $3,368,000
Unbilled receivables (including
retainages) on contracts-in-progress 1,058,000 920,000
Amounts receivable from the United
States Government and its agencies 279,000 339,000
---------- ----------
4,714,000 4,627,000
---------- ----------
Less allowance for doubtful accounts 58,000 137,000
---------- ----------
Accounts receivable, net $4,656,000 $4,490,000
========== ==========
</TABLE>
(4) Inventories
Inventories consist of the following:
<TABLE>
<CAPTION>
January 31, July 31,
1996 1995
----------- ----------
<S> <C> <C>
Raw materials and components $1,317,000 $1,437,000
Work-in-process 5,822,000 4,234,000
---------- ----------
7,139,000 5,671,000
</TABLE>
<PAGE>
-7-
<TABLE>
<CAPTION>
Less:
<S> <C> <C>
Progress payments 513,000 93,000
Inventory reserves 645,000 567,000
---------- ----------
Inventories - net $5,981,000 $5,011,000
========== ==========
</TABLE>
(5) Accrued Expenses and Other Current Liabilities
<TABLE>
<CAPTION>
Accrued expenses and other current liabilities consist of the following:
January 31, July 31,
1996 1995
---------- --------
<S> <C> <C>
Customer advances and deposits $ 562,000 $ 321,000
Accrued wages and benefits 490,000 461,000
Accrued commissions 578,000 401,000
Other 581,000 $ 507,000
---------- ----------
$2,211,000 $1,690,000
========== ==========
</TABLE>
(6) Long-Term Debt
Long-term debt consists of the following:
<TABLE>
<CAPTION>
January 31, July 31,
1996 1995
---------- ----------
<S> <C> <C>
Obligations under capital leases $2,679,000 $2,868,000
Less current installments 588,000 591,000
---------- ----------
$2,091,000 $2,277,000
========== ==========
</TABLE>
(7) Income Taxes
For the six months ended January 31, 1996 and 1995, the provision for
income taxes was $10,000 and $8,000, respectively.
The provision for income taxes included in the accompanying consolidated
financial statements of operations consisted entirely of estimated state and
local income tax.
The tax effects of temporary differences that give rise to significant
portions of the deferred tax assets at July 31, 1995 are presented below. There
are no temporary differences that give rise to deferred tax liabilities.
<PAGE>
-8-
Deferred tax asset:
Allowances for doubtful accounts receivable $ 47,000
Inventories, principally due to additional costs
inventoried for tax purposes pursuant to the Tax
Reform Act of 1986 452,000
Plant and equipment, principally due to capitalized
interest and differences in depreciation 186,000
Compensated absences, principally due to accrual
for financial reporting purposes 195,000
Deferred compensation 94,000
Net operating loss carryforwards 4,294,000
Investment tax credit carryforwards 440,000
Alternative minimum tax credit carryforwards 87,000
----------
Total gross deferred tax assets 5,795,000
Less valuation allowance (5,795,000)
----------
Net deferred tax assets $ -
==========
The valuation allowance for deferred tax assets as of July 31, 1995 was
$5,795,000. In assessing the realizability of deferred tax assets, management
considers whether it is more likely than not that some portion or all of the
deferred tax assets will not be realized.
The ultimate realization of deferred tax assets is dependent upon the
generation of future taxable income during the periods in which those temporary
differences become deductible. Management considers projected future taxable
income and tax planning strategies in making this assessment. In order to fully
realize the deferred tax asset, the Company will need to generate future taxable
income of approximately $16,500,000. Taxable loss for the six months ended
January 31, 1996 was approximately $140,000. Based upon the level of historical
taxable income and projections for future taxable income over the periods which
the deferred tax assets are deductible, management believes it is more likely
than not the Company will not realize the benefits of these deferred tax assets
and has fully reserved the deferred asset.
(8) Earnings Per Share
Earnings per share are based on the weighted average number of common and
common equivalent shares (if dilutive) outstanding during each year.
<PAGE>
-9-
COMTECH TELECOMMUNICATIONS CORP. AND SUBSIDIARIES
-------------------------------------------------
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
---------------------------------------------------------
CONDITION AND RESULTS OF OPERATIONS
-----------------------------------
COMPARISON OF THE RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED JANUARY 31,
- ------------------------------------------------------------------------------
1996 AND JANUARY 31, 1995
- -------------------------
Net Sales. Net sales were $4,747,000 and $4,099,000 for the three months ended
January 31, 1996 and 1995, respectively, representing an increase of $648,000,
or 15.8%. This was due primarily to a higher level of sales at Comtech
Communications Corp., and to a lesser extent, increased sales at Comtech
Systems Inc. partially offset by lower sales at Comtech Antenna Systems Inc.
Gross Margin. Gross profit was $1,434,000 or 30.2% of net sales for the three
months ended January 31, 1996 compared to $1,080,000 or 26.3% for the same
period in fiscal 1995. The increase in gross margins was due primarily to the
effect of higher margins at Comtech Communications Corp. and the increase in
gross profits was primarily due to the overall higher sales.
Selling, General and Administrative. Selling, general and administrative
expenses were $1,163,000 or 24.5% of net sales for the three month period ended
January 31, 1996 and $1,171,000 or 28.6% for the same period in fiscal 1995.
This decrease as a percentage of sales was primarily due to the higher level of
sales without a corresponding higher level of expenses.
Research and Development. Research and development expenses were $157,000 and
$265,000 for the three months ended January 31, 1996 and 1995, respectively,
representing a decrease of $108,000, or 40.8%. This decrease was due primarily
to the decrease in these expenses at Comtech Communications Corp. as they moved
from their developmental stage to the production and shipments of their
products.
Results from Operations. As a result of the foregoing factors, the Company had
a net operating profit of $114,000 for the three months ended January 31, 1996
compared to a net operating loss of $356,000 for the comparable prior year
period.
Interest Expense. Interest expense was $86,000 and $84,000 for the three months
ended January 31, 1996 and 1995, respectively. Interest expense for both
periods was attributable largely to interest associated with the Company's
capital lease obligations. There was no borrowing against the Company's bank
line of credit in either period.
Interest Income. Interest income was $20,000 and $46,000 for the three months
ended January 31, 1996 and 1995, respectively. This decrease was due primarily
to the decrease in the amount of cash available to invest in the fiscal 1996
period.
Provision for Income Taxes. The provision for income taxes was
$3,000 and $4,000 for the three months ended January 31, 1996 and 1995,
respectively, which principally relates to state income taxes. The Company
files on a consolidated basis for federal income tax purposes and is not
expected to incur federal taxes for these periods due to the losses incurred.
The Company believes its tax benefits are subject to a 100% valuation allowance
due to earnings fluctuations inherent in the Company's operations and the
potential limitations on utilization of loss and credit carryforwards pursuant
to Sections 382 and 383 of the Internal Revenue Code of 1986.
<PAGE>
-10-
COMPARISON OF THE RESULTS OF OPERATIONS FOR THE SIX MONTHS ENDED JANUARY 31,
----------------------------------------------------------------------------
1996 AND JANUARY 31, 1995
-------------------------
Net Sales. Net sales were $9,203,000 and $7,041,000 for the six months ended
January 31, 1996 and 1995, respectively, representing $2,162,000, or a 30.7%
increase. This was due primarily to a higher level of sales at Comtech
Communications Corp.
Gross Margin. Gross profit was $2,748,000 or 29.9% of net sales and $1,931,000
or 27.4% of net sales for the six months ended January 31, 1996 and 1995,
respectively, representing a period-to-period increase of $817,000 or 42.3%. The
The increase in gross margins was primarily due to higher gross margins at
Comtech Communications Corp. and Comtech Systems, Inc. The increase in gross
profits was due primarily to the increase in sales.
Selling, General and Administrative. Selling, general and administrative
expenses were $2,367,000 or 25.7% of net sales and $2,307,000 or 32.8% of net
sales for the six months ended January 31, 1996 and 1995, respectively. The
decrease, as a percentage of net sales, was due primarily to achieving a higher
level of sales with only a nominal increase in expenses.
Research and Development. Research and development expenses were $392,000 and
$450,000 for the six months ended January 31, 1996 and 1995, respectively. This
decrease was due primarily to a decrease in these expenses at Comtech
Communications Corp. as they moved from their developmental stage to the
production and shipments of their products.
Operating Loss. As a result of the foregoing factors, the Company had an
operating loss of $11,000 for the six months ended January 31, 1996 compared to
an operating loss of $826,000 for the comparable prior year period.
Interest Expense. Interest expense was $157,000 and $154,000 for the six month
period ended January 31, 1996 and 1995, respectively. Interest expense for both
periods was mainly attributable to interest associated with the Company's
capital lease obligations. There was no borrowing against the Company's bank
line of credit in either year.
Interest Income. Interest income was $37,000 and $96,000 for the six months
ended January 31, 1996 and 1995, respectively. This decrease was due primarily
to the decrease in the amount of cash available to invest in the fiscal 1996
period.
Provision for Income Taxes. The provision for income taxes was $10,000 and
$8,000 for the six months ended January 31, 1996 and 1995, respectively, which
principally relates to state income taxes. The Company files on a consolidated
basis for federal income tax purposes and is not expected to incur federal taxes
for these periods due to the losses incurred. The Company believes its tax
benefits are subject to a 100% valuation allowance due to earnings fluctuations
inherent in the Company's operations and the potential limitations on
utilization of loss and credit carryforwards pursuant to Sections 382 and 383 of
the Internal
<PAGE>
-11-
Revenue Code of 1986.
LIQUIDITY AND CAPITAL RESOURCES
- -------------------------------
As of January 31, 1996, the Company's cash and cash equivalents position
decreased by $660,000 from $2,044,000 at July 31, 1995 to $1,384,000 at January
31, 1996.
Operating activities used $441,000 as a result of a net loss as adjusted for
depreciation and other non-cash charges, an increase in accounts receivable,
inventories, other current assets and a decrease in accounts payable partially
offset by an increase in accrued expenses and other current liabilities and a
decrease in other assets.
Accounts receivable were $4,656,000 at January 31, 1996 as compared to
$4,490,000 at July 31, 1995 net of an allowance for doubtful accounts of $58,000
at January 31, 1996 and $137,000 at July 31, 1995. Of these amounts $3,598,000
and $3,570,000 represented net amounts due from customers for products and
services rendered as of January 31, 1996 and July 31, 1995, respectively, and
the balances of $1,058,000 and $920,000, respectively, represented unbilled
amounts for sales recorded on a percentage-of-completion basis as of such dates.
The portion of accounts receivable represented by unbilled accounts receivable
will vary at any time as a function of the volume of contracts being performed
by the Company that are accounted for on a percentage-of-completion basis. The
Company believes that its allowance for doubtful accounts is sufficient based on
past experience and the Company's credit standards. The Company generally
requires international customers to secure their obligations by letter of
credit.
Inventory levels of materials and components and work-in-process, net of
progress payments and reserves were $5,981,000 and $5,011,000 at January 31,
1996 and July 31, 1995, respectively. This increase was due primarily to the
additional inventory required to address the increased backlog at January 31,
1996 which was $12,411,000 as compared to $10,242,000 at July 31, 1995. The
Company generally operates on a job-order cost basis, that is, costs are
incurred as work-in-process inventory for specific contracts or "jobs" and,
accordingly, inventory levels will vary as a function of the status of the
Company's order backlog. The Company does have some product lines which require
a more competitive response to customers requirements and require the Company to
provide for a level of "off-the-shelf" equipment. The only other general
inventory that the Company maintains is for basic components which are common
for most of its products.
Accounts payable decreased by $155,000, primarily as a result of the faster
payments to vendors.
Accrued expenses and other current liabilities increased by $521,000 as a result
of increased advances and deposits received from customers, additional accrued
wages and benefits, increased commissions and other expenses.
<PAGE>
-12-
Investing activities provided $130,000 of cash principally as the result of
the net proceeds from the sale of marketable securities less the amount utilized
for the purchase of equipment.
Financing activities used $349,000 of cash for principal payments of long term
debt.
The Company has a $4.5 million credit facility which expires on January 31,
1997. The facility is to finance working capital requirements and is available
for direct borrowing and standby letters of credit. Direct borrowings under the
line will bear interest at 1% over the prime rate and is to be secured at the
time of borrowing with collateral satisfactory to the financial institution.
There were no borrowings under the Company's credit facility during the six
months ended January 31, 1996. At January 31, 1996, the Company had letters of
credit outstanding, secured by short-term certificates of deposit in the amount
of $477,000, representing the amount of restricted cash.
The Company believes that its current cash position, funds generated from
operations and funds available from its current credit facility, collectively,
are adequate to meet the Company's foreseeable cash requirements.
The Company's cash investments consist of highly liquid interest bearing
commercial debt obligations and U.S. Treasury obligations.
<PAGE>
-13-
PART II
-------
OTHER INFORMATION
-----------------
Item 6. Exhibits and Reports on Form 8-K
--------------------------------
(a) Exhibit 11.
--- -----------
The following exhibit is annexed hereto:
Computation of Earnings (Loss) per Common Share - Page 14
<PAGE>
-14-
SIGNATURE
---------
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
COMTECH TELECOMMUNICATIONS CORP.
--------------------------------
(Registrant)
Date: March 14, 1996 By: _______________________________
Fred Kornberg
Chairman of the Board
Chief Executive Officer
and President
Date: March 14, 1996 By: _______________________________
J. Preston Windus, Jr.
Chief Financial Officer
Vice President and Secretary
<PAGE>
-15-
SIGNATURE
---------
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
COMTECH TELECOMMUNICATIONS CORP.
--------------------------------
(Registrant)
Date: March 14, 1996 By: s/Fred Kornberg
--------------------------------
Fred Kornberg
Chairman of the Board
Chief Executive Officer
and President
Date: March 14, 1996 By: s/J. Preston Windus, Jr.
--------------------------------
J. Preston Windus, Jr.
Vice President, Chief Financial
Officer and Secretary
<PAGE>
Exhibit 11.0
COMTECH TELECOMMUNICATIONS CORP. AND SUBSIDIARIES
-------------------------------------------------
COMPUTATION OF EARNINGS (LOSS) PER COMMON SHARE
-----------------------------------------------
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
January January
----------------- -----------------
1996 1995 1996 1995
---- ---- ---- ----
<S> <C> <C> <C> <C>
Net Earnings (Loss) $ 45,000 $ (398,000) $ (141,000) $ (892,000)
- ------------------- ========== ========== ========== ==========
Computation of weighted average
number of common equivalent
shares outstanding during the period:
Weighted average number of common
shares 2,605,344 2,605,344 2,605,344 2,605,344
Weighted average shares assumed
to be issued upon exercise of
common stock option - - - -
Less Treasury Stock (15,000) (15,000) (15,000) (15,000)
---------- ---------- ---------- ----------
Weighted average number of
common and common equivalent
shares outstanding during the
period 2,590,344 2,590,344 2,590,344 2,590,344
========== ========== ========== ==========
Earnings (loss) per share: $ .02 $ (.15) $ (.05) $ (.34)
- -------------------------- ========== ========== ========== ==========
</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM CONSOLIDATED
FINANCIAL STATEMENTS 10Q 01/31/96 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE
TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> JUL-31-1996
<PERIOD-START> AUG-01-1995
<PERIOD-END> JAN-31-1995
<CASH> 1,384
<SECURITIES> 0
<RECEIVABLES> 4,714
<ALLOWANCES> 58
<INVENTORY> 5,981
<CURRENT-ASSETS> 12,374
<PP&E> 13,947
<DEPRECIATION> 9,869
<TOTAL-ASSETS> 16,894
<CURRENT-LIABILITIES> 4,788
<BONDS> 0
0
0
<COMMON> 261
<OTHER-SE> 9,754
<TOTAL-LIABILITY-AND-EQUITY> 16,894
<SALES> 9,203
<TOTAL-REVENUES> 9,203
<CGS> 6,455
<TOTAL-COSTS> 9,214
<OTHER-EXPENSES> 0
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<INTEREST-EXPENSE> 157
<INCOME-PRETAX> (131)
<INCOME-TAX> 10
<INCOME-CONTINUING> (141)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (141)
<EPS-PRIMARY> (.05)
<EPS-DILUTED> (.05)
</TABLE>
