Comtech Telecommunications Corp. (NASDAQ:CMTL) Q1 2024 Earnings Call Transcript

George Notter: Got it. Okay. That makes sense. And then so the term loan, do you have more availability on the term loan then between now and when this facility expires?

Mike Bondi: Good question. In our footnotes, we did disclose that we have borrowed up to the maximum on the revolver at this point. I just wanted to make sure that we had efficient access to cash as we’re going through these discussions and negotiations. As we’re going into the second quarter, we did draw down at the start of Q2, just to make sure we had adequate liquidity. So at this point, the answer is no, we don’t have any additional borrowing capacity on the revolver and the term loan, as we pay it down, it settles the commitment on that portion of the facility.

George Notter: Got it. Okay. And then is there any — I’m just thinking about the timing of it all. You guys have been working on kind of resolving the balance sheet issues for some time. And I guess, I’m just curious about the process. I mean I assume the Stellant transaction was kind of, an element or a step in kind of moving down the path. I mean, do you feel like — is there any context you can give us in terms of milestones or progress or what we’re kind of waiting for to kind of arrive at a deal here?

Mike Bondi: Good question. We’ve been at this for a little bit. I think over the last several months, we’ve been approaching alternatives like an asset-based loan, for example, Comtech has never had an asset-based loan before with the borrowing base capacity. So something like that, we needed to educate ourselves on. So, we did engage with third parties to do our own internal evaluation of what a borrowing base could be and how that would fit into our alternatives. So that’s just one example of the homework we’ve been doing to try to get a durable solution here. And stuff like that does take a little bit of time. We think it was worth it to do that. We did get some good insights. And as we’ve been saying, we’ve been talking with several parties.

So, we’ve been also translating all these alternatives and how something like an asset-based loan would fit into the cap structure. So that’s just one example of something that takes a little bit of time to do. But that’s behind us now in terms of the timing. I think we’ve progressed through that step and now trying to fit that into a cash structure.

George Notter: Got it. Okay. Thank you very much.

Ken Peterman: You’re welcome. Thanks.

Operator: And it does appear that there are no further questions at this time. I would now like to turn it back to the speakers for any closing remarks.

Ken Peterman: Thanks, everyone. We’re very excited about the journey we’re on. We’re very excited about what’s ahead of us and we thank you for the call. Thank you.

Operator: This does conclude today’s program. Thank you for your participation. You may disconnect at any time and have a wonderful evening.