C-COM Satellite Systems, a leading provider of mobile auto-deploying satellite antenna systems, announced financial results for the second quarter ended May 31, 2020. The Company has generated revenues of $1,061,665 and a net after tax loss of $466,930 or -1 cent per share. This compared with revenues of $2,566,595 and a net after tax profit of $267,342 or 1 cent per share for Q2, 2019 – representing a decrease of 59% and 275% respectively.
The Q2 net after tax loss incorporates a onetime expense of $316,498 ($430,609 pre-tax). Excluding the impact of this onetime expense, the net after tax loss reduces to $150,432. The working capital of the Company decreased by 4.7% to $21,334,750 at May 31, 2020 as compared to $22,383,369 at November 30, 2019.
The Company paid out $477,045 in dividends during this second quarter compared to $470,894 in the second quarter of 2019, representing a 1.3% increase. The Company has maintained its quarterly dividend payout while continuing to innovate and invest into the next generation of advanced antenna products.
The Company also approved the payment of its eligible quarterly dividend in the amount of $0.0125 per common share payable on August 18, 2020 to all shareholders of record as of August 4, 2020. Based on the closing price of $3.16 per share on July 20th, 2020, this dividend represents a yield of 1.58% on an annualized basis. This is the Company’s 37th consecutive quarterly dividend.
“In Q2 the Company continued to experience a slowdown in our markets that grew beyond Asia to the US and other areas impacted by the spread of the COVID-19 virus. Also, the OPEC oil production dispute that had dampened activity with our oil sector customers spilled into the early part of the quarter” said Dr. Leslie Klein, President & CEO of C-COM Satellite Systems. “The COVID-19 virus will make 2020 a challenging year for all businesses. Our healthy balance sheet, extensive inventory, and new products position us well to mitigate challenges that this year will bring. However, I am encouraged that increased activity recently triggered the need for our engineering and testing teams to return to a full workweek.”
“In addition, there has been a resumption of tangible interest from Asia and North America in our new Manpack series antennas. As well, a new vertical market for tracking LEO’s, Smallsats and CubeSats is emerging and C-COM has developed advanced tracking algorithms for this market for use with its existing Flyaway antennas. We expect this new market to generate incremental revenue for the Company.”
Klein added, “In spite of the impact of COVID-19, we were able to push ahead with our R&D efforts. For example, we announced in Q2 that we had successfully completed the integration of the UHP-200 modem and the Comtech EF Data branded Heights™ Networking Platform with our iNetVu antenna controllers.”
“The Company is also involved in extensive R&D of next generation antenna technologies in conjunction with the University of Waterloo. This effort should provide C-COM with a revolutionary, patentable Ka-band antenna technology to be used with the growing number of LEO constellations being launched in the next several years. This modular and conformal antenna technology is designed to be mass producible and be compatible with 5G and other developing millimeter wave technologies.” Klein concluded.
The Company also announced that Drew Klein, Vice President of Sales at C-COM is transitioning to a Special Projects Consulting position with the Company, effective July 22, 2020.