Comtech Profit Down, But Tops View - Update

(RTTNews) - Comtech Telecommunications Corp. (CMTL) on Wednesday reported a small drop in profit for the first quarter, as sales declined across all units. Earnings for the quarter topped Wall Street estimates, but revenues fell short of expectations.

Moving ahead, the company maintained its earnings outlook for the full year, but tightened its revenue guidance.

Melville, New York-based Comtech's first-quarter profit inched down to $5.2 million or $0.32 per share from $5.3 million or $0.28 per share last year.

Excluding expenses of $0.6 million associated with the company's strategic alternatives analysis, adjusted earnings were $5.6 million or $0.34 per share. Analysts polled by Thomson Reuters expected earnings of $0.29 per share for the quarter. Analysts' estimates typically exclude special items.

Comtech sales for the first-quarter dropped to $76.4 million from $83.4 million a year ago. Analysts had a consensus revenue estimate of $78.84 million for the quarter.

The company said lower sales reflects decline in all three of it operating segments; telecommunications transmission, RF microwave amplifiers and mobile data communications segments.

Commenting on the results, Chief Executive Fred Kornberg Officer said, "Although market conditions remain challenging, we are pleased that we posted solid results in the first quarter. While we have become more cautious, we still expect top and bottom line growth in fiscal 2015."

Looking forward to the full year 2014, the company continues to see earnings of $1.70 to $1.86 per share. However, the company tightened its revenue outlook to range of $355 million to $365 million from a prior guidance of $355 million and $370 million. Analysts currently expect earnings of $1.79 per share on revenue of $359.67 million for 2015.

The company expects its second-quarter results to be similar to the first-quarter. Full-year 2015 growth will be heavily weighted towards the second half of the year, with the fourth quarter being the peak quarter, the company noted.

CMTL closed Wednesday's trading at $35.33, down $3.62 or 9.29%, on the Nasdaq. The stock further dropped $0.00 or 0.01%, in the after-hours trade.