Comtech Telecommunications Issues Letter to Stockholders
Dear Fellow Stockholders,
As you may be aware,
Since our series of announcements, the Company has met and continues to have conversations with our stockholders about our results and our long-term strategy. We have been pleased with these meetings and have received constructive and candid feedback that we are incorporating into our internal discussions among the Board and management team regarding the overall strategy for the Company.
We value all of our stockholders' points of view and remain steadfast in our commitment to an ongoing dialogue with all of our investors. We will address MMI's director nominees in due course; but for now, we wanted to share with all of our stockholders our perspective on
Strong Long-Term Stock Price Performance and Value Creation for Stockholders
Over the past ten years,
A chart that illustrates
2011: A Year of Strong Performance
The Company has continued to deliver value in a turbulent environment and has consistently met or exceeded earnings expectations. Since the beginning of fiscal 2011,
A chart that illustrates
The return of 50.4% reflects how
Our core business (excluding the MTS and BFT-1 programs) grew 2.5% in revenue in fiscal 2011 despite adverse business conditions. We continued to manage these businesses effectively and have positioned them for growth.
All three of the Company's segments were profitable in fiscal 2011 and are expected to be profitable in fiscal 2012, even as we continue to invest judiciously in R&D for future growth. We have undertaken recent cost reduction efforts which should drive operating efficiencies. We have a strong balance sheet which will support investments in new markets and products.
Prudent Capital Allocation Approach;
Over the past year,
September 2010: Established quarterly dividend of $0.25per share and announced $100 millionstock buyback
July 2011: Announced completion of initial $100 millionin buyback and authorization of an additional $150 millionin stock repurchases
September 2011: Increased quarterly cash dividend to $0.275per share and increased stock buyback plan by a further $100 millionto an aggregate of $350 million
We have sought, through our stock repurchase and dividend programs, to strike a prudent balance between returning cash to stockholders and retaining cash on-hand to be opportunistic about attractive acquisition candidates.
Our Commitment to Stockholders
Your Board and senior management team, after consultation with the Company's external advisors who have substantial industry and capital markets experience, routinely evaluate the Company's strategic alternative analyses and future prospects. We remain confident that we are on the right course to deliver a highly attractive return and value for our stockholders.
Our track record of 17% average annual returns for the past 10 years and a total return of 50.4% since the beginning of the last fiscal year in
Chairman of the Board and Chief Executive Officer
Lead Independent Director
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, and 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 its 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 nature and timing of receipt of, and the Company's performance on, new or existing 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 Company's legal proceedings and other matters; risks associated with the Company's MTS and BFT contracts, including the Company's ongoing negotiations with the
Certain Information Regarding Participants
Michael D. Porcelain, Senior Vice President and Chief Financial Officer 631-962-7000 email@example.com Brunswick Group Steve Lipin/ Monika Driscoll212-333-3810 Innisfree M&A Incorporated Art Crozier/ Jennifer Shotwell/ Larry Miller212-750-5833
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