Comtech Telecommunications Corp. Modifies BFT-1 Sustainment Contract and Receives Initial Order for Year 2 of Sustainment Services
MELVILLE, N.Y.--(BUSINESS WIRE)--
April 8, 2013--Comtech Telecommunications Corp. (Nasdaq: CMTL) announced
today that its Germantown, Maryland-based subsidiary, Comtech Mobile
Datacom Corporation, modified its Blue Force Tracking ("BFT-1")
sustainment contract and received an initial order for Year 2 of BFT-1
Due to budget pressures and administrative issues placed on the U.S.
Army by the Continuing Resolution and Sequester, the U.S. government
requested, and Comtech agreed to, a two year $43.6 million BFT-1
sustainment contract which modified the terms of Comtech's previously
announced three year BFT-1 sustainment contract, which had a
not-to-exceed value of $80.7 million. The contract value for Year 2 was
definitized at $20.8 million and has a performance period of April 1,
2013 to March 31, 2014. The contract value for Year 1 was definitized at
$22.8 million. The modified two year BFT-1 sustainment contract provides
the U.S. government with the ability to fund orders in stages. In
connection with these modifications, Comtech received an initial $5.0
million funded order for Year 2, which includes $2.5 million for the
first three months of the annual IP license fee, with the remaining
funds allocated to network operations center services and telehousing.
Based on indications from the U.S. Army, Comtech expects to receive
additional orders aggregating $15.8 million for the remaining nine
months of Year 2 (including $7.5 million of the $10.0 million annual IP
license fee). As expected, Comtech also received an additional $1.1
million of funding related to the definitization of Year 1 of the BFT-1
sustainment contract (for which the Year 1 performance period ended
March 31, 2013).
The U.S. Army has also informed the Company that it intends to award and
fund a separate contract to Comtech to procure future BFT-1 sustainment
services (including the $10.0 million annual IP license fee) for periods
beyond March 31, 2014.
Fred Kornberg, President and Chief Executive Officer of Comtech
Telecommunications Corp., stated, "We are pleased to continue to support
the U.S. Army's BFT-1 and MTS Programs for deployed and homeland forces.
We recognize the difficult funding situation the U.S. Army is facing
today and have agreed to contract changes to try to help our customer in
this difficult time. We're proud to continue our support to the U.S.
Army to ensure this vital system remains operational for U.S. and Allied
Comtech Mobile Datacom Corporation, a Germantown, Maryland-based
company, is engaged in the provision of satellite-based packet data
communication systems and location and messaging services through the
use of advanced communication and network technology. To learn more
about Comtech Mobile Datacom, please visit the company's website at www.comtechmobile.com.
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, inefficient or too
expensive. The Company conducts business through three complementary
segments: telecommunications transmission, RF microwave amplifiers and
mobile data communications. 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.
Certain information in this press release contains statements that
are forward-looking in nature and involve certain significant risks and
uncertainties. Actual results could differ materially from such
forward-looking information. The Company's Securities and Exchange
Commission filings identify many such risks and uncertainties. Any
forward-looking information in this press release is qualified in its
entirety by the risks and uncertainties described in such Securities and
Exchange Commission filings.
Media Contact: Michael D. Porcelain, Senior Vice President
and Chief Financial Officer (631) 962-7000 Info@comtechtel.com