Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Apr. 30, 2020 | May 29, 2020 | |
Document and Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Apr. 30, 2020 | |
Current Fiscal Year End Date | --07-31 | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2020 | |
Entity Registrant Name | COMTECH TELECOMMUNICATIONS CORP /DE/ | |
Entity Central Index Key | 0000023197 | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Emerging Growth Company | false | |
Entity Small Business | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 24,731,940 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Apr. 30, 2020 | Jul. 31, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 50,634,000 | $ 45,576,000 |
Accounts receivable, net | 137,887,000 | 145,032,000 |
Inventories, net | 79,423,000 | 74,839,000 |
Prepaid expenses and other current assets | 22,691,000 | 14,867,000 |
Total current assets | 290,635,000 | 280,314,000 |
Property, plant and equipment, net | 27,149,000 | 28,026,000 |
Operating lease right-of-use assets, net | 31,942,000 | 0 |
Goodwill | 335,477,000 | 310,489,000 |
Intangibles with finite lives, net | 260,162,000 | 261,890,000 |
Deferred financing costs, net | 2,575,000 | 3,128,000 |
Other assets, net | 3,792,000 | 3,864,000 |
Total assets | 951,732,000 | 887,711,000 |
Current liabilities: | ||
Accounts payable | 32,942,000 | 24,330,000 |
Accrued expenses and other current liabilities | 83,561,000 | 78,584,000 |
Operating lease liabilities, current | 8,480,000 | 0 |
Finance lease and other obligations, current | 0 | 757,000 |
Dividends payable | 2,466,000 | 2,406,000 |
Contract liabilities | 46,070,000 | 38,682,000 |
Interest payable | 253,000 | 588,000 |
Total current liabilities | 173,772,000 | 145,347,000 |
Non-current portion of long-term debt | 159,400,000 | 165,000,000 |
Operating lease liabilities, non-current | 25,864,000 | 0 |
Income taxes payable | 2,316,000 | 325,000 |
Deferred tax liability, net | 16,676,000 | 12,481,000 |
Long-term contract liabilities | 11,151,000 | 10,654,000 |
Other liabilities | 16,728,000 | 18,822,000 |
Total liabilities | 405,907,000 | 352,629,000 |
Commitments and contingencies (See Note 19) | ||
Stockholders’ equity: | ||
Preferred stock, par value $0.10 per share; shares authorized and unissued 2,000,000 | 0 | 0 |
Common stock, par value $0.10 per share; authorized 100,000,000 shares; issued 39,765,257 shares and 39,276,161 shares at April 30, 2020 and July 31, 2019, respectively | 3,977,000 | 3,928,000 |
Additional paid-in capital | 564,965,000 | 552,670,000 |
Retained earnings | 418,732,000 | 420,333,000 |
Stockholders' equity before treasury stock | 987,674,000 | 976,931,000 |
Treasury stock, at cost (15,033,317 shares at April 30, 2020 and July 31, 2019) | (441,849,000) | (441,849,000) |
Total stockholders’ equity | 545,825,000 | 535,082,000 |
Total liabilities and stockholders’ equity | $ 951,732,000 | $ 887,711,000 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Apr. 30, 2020 | Jul. 31, 2019 |
Stockholders’ equity: | ||
Preferred stock, par value (in dollars per share) | $ 0.10 | $ 0.10 |
Preferred stock, shares authorized (in shares) | 2,000,000 | 2,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.10 | $ 0.10 |
Common stock, shares authorized (in shares) | 100,000,000 | 100,000,000 |
Common stock, shares issued (in shares) | 39,765,257 | 39,276,161 |
Treasury stock, shares (in shares) | 15,033,317 | 15,033,317 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) | 3 Months Ended | 9 Months Ended | ||
Apr. 30, 2020 | Apr. 30, 2019 | Apr. 30, 2020 | Apr. 30, 2019 | |
Income Statement [Abstract] | ||||
Net sales | $ 135,121,000 | $ 170,448,000 | $ 467,042,000 | $ 495,425,000 |
Cost of sales | 82,120,000 | 106,032,000 | 289,872,000 | 311,995,000 |
Gross profit | 53,001,000 | 64,416,000 | 177,170,000 | 183,430,000 |
Expenses: | ||||
Selling, general and administrative | 32,313,000 | 33,409,000 | 93,538,000 | 97,243,000 |
Research and development | 12,324,000 | 13,471,000 | 40,925,000 | 40,664,000 |
Amortization of intangibles | 5,517,000 | 4,536,000 | 15,952,000 | 13,113,000 |
Settlement of intellectual property litigation | 0 | 0 | 0 | (3,204,000) |
Acquisition plan expenses | 5,983,000 | 1,704,000 | 14,397,000 | 4,612,000 |
Total operating expenses | 56,137,000 | 53,120,000 | 164,812,000 | 152,428,000 |
Operating (loss) income | (3,136,000) | 11,296,000 | 12,358,000 | 31,002,000 |
Other expenses: | ||||
Interest expense | 1,504,000 | 2,159,000 | 4,924,000 | 7,095,000 |
Write-off of deferred financing costs | 0 | 0 | 0 | 3,217,000 |
Interest (income) and other | 108,000 | (22,000) | 37,000 | (7,000) |
(Loss) income before (benefit from) provision for income taxes | (4,748,000) | 9,159,000 | 7,397,000 | 20,697,000 |
(Benefit from) provision for income taxes | (759,000) | 1,547,000 | 1,503,000 | 1,791,000 |
Net (loss) income | $ (3,989,000) | $ 7,612,000 | $ 5,894,000 | $ 18,906,000 |
Net (loss) income per share (See Note 6): | ||||
Basic (in dollars per share) | $ (0.16) | $ 0.31 | $ 0.24 | $ 0.79 |
Diluted (in dollars per share) | $ (0.16) | $ 0.31 | $ 0.24 | $ 0.78 |
Weighted average number of common shares outstanding – basic (in shares) | 24,982,000 | 24,192,000 | 24,730,000 | 24,074,000 |
Weighted average number of common and common equivalent shares outstanding – diluted (in shares) | 24,982,000 | 24,330,000 | 24,892,000 | 24,263,000 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Stockholders' Equity - USD ($) | Total | Common Stock | Additional Paid-in Capital | Retained Earnings | Treasury Stock |
Common stock, beginning balance (in shares) at Jul. 31, 2018 | 38,860,571 | ||||
Beginning balance at Jul. 31, 2018 | $ 505,684,000 | $ 3,886,000 | $ 538,453,000 | $ 405,194,000 | $ (441,849,000) |
Treasury stock, beginning balance (in shares) at Jul. 31, 2018 | 15,033,317 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Equity-classified stock award compensation | 3,356,000 | 3,356,000 | |||
Proceeds from exercises of stock options (in shares) | 6,100 | ||||
Proceeds from exercises of stock options | 174,000 | $ 1,000 | 173,000 | ||
Proceeds from issuance of employee stock purchase plan shares (in shares) | 32,035 | ||||
Proceeds from issuance of employee stock purchase plan shares | 709,000 | $ 3,000 | 706,000 | ||
Issuance of restricted stock (in shares) | 10,386 | ||||
Issuance of restricted stock, net | $ 0 | $ 1,000 | (1,000) | ||
Net settlement of stock-based awards (in shares) | 9,345 | 53,438 | |||
Net settlement of stock-based awards | $ (2,069,000) | $ 5,000 | (2,074,000) | ||
Common stock issued for acquisitions (in shares) | 208,669 | ||||
Common stock issued for acquisitions | 5,606,000 | $ 21,000 | 5,585,000 | ||
Cash dividends declared | (7,169,000) | (7,169,000) | |||
Accrual of dividend equivalents, net of reversal | (248,000) | (248,000) | |||
Net income | 18,906,000 | 18,906,000 | |||
Common stock, ending balance (in shares) at Apr. 30, 2019 | 39,171,199 | ||||
Ending balance at Apr. 30, 2019 | 524,949,000 | $ 3,917,000 | 546,198,000 | 416,683,000 | $ (441,849,000) |
Treasury stock, ending balance (in shares) at Apr. 30, 2019 | 15,033,317 | ||||
Common stock, beginning balance (in shares) at Jan. 31, 2019 | 38,950,547 | ||||
Beginning balance at Jan. 31, 2019 | 512,877,000 | $ 3,895,000 | 539,273,000 | 411,558,000 | $ (441,849,000) |
Treasury stock, beginning balance (in shares) at Jan. 31, 2019 | 15,033,317 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Equity-classified stock award compensation | 1,119,000 | 1,119,000 | |||
Proceeds from issuance of employee stock purchase plan shares (in shares) | 11,837 | ||||
Proceeds from issuance of employee stock purchase plan shares | 233,000 | $ 1,000 | 232,000 | ||
Net settlement of stock-based awards (in shares) | 146 | ||||
Net settlement of stock-based awards | (11,000) | (11,000) | |||
Common stock issued for acquisitions (in shares) | 208,669 | ||||
Common stock issued for acquisitions | 5,606,000 | $ 21,000 | 5,585,000 | ||
Cash dividends declared | (2,405,000) | (2,405,000) | |||
Accrual of dividend equivalents, net of reversal | (82,000) | (82,000) | |||
Net income | 7,612,000 | 7,612,000 | |||
Common stock, ending balance (in shares) at Apr. 30, 2019 | 39,171,199 | ||||
Ending balance at Apr. 30, 2019 | $ 524,949,000 | $ 3,917,000 | 546,198,000 | 416,683,000 | $ (441,849,000) |
Treasury stock, ending balance (in shares) at Apr. 30, 2019 | 15,033,317 | ||||
Common stock, beginning balance (in shares) at Jul. 31, 2019 | 39,276,161 | 39,276,161 | |||
Beginning balance at Jul. 31, 2019 | $ 535,082,000 | $ 3,928,000 | 552,670,000 | 420,333,000 | $ (441,849,000) |
Treasury stock, beginning balance (in shares) at Jul. 31, 2019 | 15,033,317 | 15,033,317 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Equity-classified stock award compensation | $ 3,098,000 | 3,098,000 | |||
Proceeds from exercises of stock options (in shares) | 16,700 | ||||
Proceeds from exercises of stock options | 468,000 | $ 2,000 | 466,000 | ||
Proceeds from issuance of employee stock purchase plan shares (in shares) | 36,168 | ||||
Proceeds from issuance of employee stock purchase plan shares | 690,000 | $ 4,000 | 686,000 | ||
Issuance of restricted stock (in shares) | 3,319 | ||||
Issuance of restricted stock, net | $ 0 | $ 0 | 0 | ||
Net settlement of stock-based awards (in shares) | 27,992 | 109,405 | |||
Net settlement of stock-based awards | $ (3,487,000) | $ 11,000 | (3,498,000) | ||
Common stock issued for acquisitions (in shares) | 323,504 | ||||
Common stock issued for acquisitions | 11,575,000 | $ 32,000 | 11,543,000 | ||
Cash dividends declared | (7,326,000) | (7,326,000) | |||
Accrual of dividend equivalents, net of reversal | (169,000) | (169,000) | |||
Net income | $ 5,894,000 | 5,894,000 | |||
Common stock, ending balance (in shares) at Apr. 30, 2020 | 39,765,257 | 39,765,257 | |||
Ending balance at Apr. 30, 2020 | $ 545,825,000 | $ 3,977,000 | 564,965,000 | 418,732,000 | $ (441,849,000) |
Treasury stock, ending balance (in shares) at Apr. 30, 2020 | 15,033,317 | 15,033,317 | |||
Common stock, beginning balance (in shares) at Jan. 31, 2020 | 39,752,559 | ||||
Beginning balance at Jan. 31, 2020 | $ 551,203,000 | $ 3,975,000 | 563,834,000 | 425,243,000 | $ (441,849,000) |
Treasury stock, beginning balance (in shares) at Jan. 31, 2020 | 15,033,317 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Equity-classified stock award compensation | 981,000 | 981,000 | |||
Proceeds from issuance of employee stock purchase plan shares (in shares) | 16,158 | ||||
Proceeds from issuance of employee stock purchase plan shares | 180,000 | $ 2,000 | 178,000 | ||
Forfeiture of restricted stock (in shares) | (5,539) | ||||
Forfeiture of restricted stock | 0 | $ (1,000) | 1,000 | ||
Net settlement of stock-based awards (in shares) | 2,079 | ||||
Net settlement of stock-based awards | (28,000) | $ 1,000 | (29,000) | ||
Cash dividends declared | (2,466,000) | (2,466,000) | |||
Accrual of dividend equivalents, net of reversal | (56,000) | (56,000) | |||
Net income | $ (3,989,000) | (3,989,000) | |||
Common stock, ending balance (in shares) at Apr. 30, 2020 | 39,765,257 | 39,765,257 | |||
Ending balance at Apr. 30, 2020 | $ 545,825,000 | $ 3,977,000 | $ 564,965,000 | $ 418,732,000 | $ (441,849,000) |
Treasury stock, ending balance (in shares) at Apr. 30, 2020 | 15,033,317 | 15,033,317 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Stockholders' Equity (Parenthetical) - $ / shares | 3 Months Ended | 9 Months Ended | ||
Apr. 30, 2020 | Apr. 30, 2019 | Apr. 30, 2020 | Apr. 30, 2019 | |
Statement of Stockholders' Equity [Abstract] | ||||
Dividends declared (in dollars per share) | $ 0.10 | $ 0.10 | $ 0.30 | $ 0.30 |
Accrual of dividend equivalents (in dollars per share) | $ 0.10 | $ 0.10 | $ 0.30 | $ 0.30 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows - USD ($) | 9 Months Ended | |
Apr. 30, 2020 | Apr. 30, 2019 | |
Cash flows from operating activities: | ||
Net income | $ 5,894,000 | $ 18,906,000 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization of property, plant and equipment | 8,022,000 | 8,618,000 |
Amortization of intangible assets with finite lives | 15,952,000 | 13,113,000 |
Amortization of stock-based compensation | 3,098,000 | 3,356,000 |
Amortization of deferred financing costs | 553,000 | 916,000 |
Estimated contract settlement costs | 444,000 | 6,351,000 |
Write-off of deferred financing costs | 0 | 3,217,000 |
Settlement of intellectual property litigation | 0 | (3,204,000) |
Change in other liabilities | (3,100,000) | (23,000) |
Loss on disposal of property, plant and equipment | 3,000 | 40,000 |
(Benefit from) provision for allowance for doubtful accounts | (364,000) | 854,000 |
Provision for excess and obsolete inventory | 1,238,000 | 2,450,000 |
Deferred income tax expense | 1,374,000 | 3,885,000 |
Changes in assets and liabilities, net of effects of business acquisitions: | ||
Accounts receivable | 10,129,000 | 10,970,000 |
Inventories | (5,689,000) | (9,136,000) |
Prepaid expenses and other current assets | (4,080,000) | (1,569,000) |
Other assets | (20,000) | (34,000) |
Accounts payable | 6,748,000 | (8,611,000) |
Accrued expenses and other current liabilities | (78,000) | 5,722,000 |
Contract liabilities | 1,063,000 | 1,333,000 |
Other liabilities, non-current | 303,000 | 377,000 |
Interest payable | (307,000) | 69,000 |
Income taxes payable | (2,176,000) | (3,757,000) |
Net cash provided by operating activities | 39,007,000 | 53,843,000 |
Cash flows from investing activities: | ||
Payment for acquisition of CGC, net of cash acquired | (11,165,000) | 0 |
Payment for acquisition of Solacom, net of cash acquired | 0 | (25,883,000) |
Payment for acquisition of NG-911 Inc. and the GD NG-911 business | (781,000) | (10,000,000) |
Purchases of property, plant and equipment | (4,420,000) | (6,388,000) |
Net cash used in investing activities | (16,366,000) | (42,271,000) |
Cash flows from financing activities: | ||
Net (payments) borrowings of long-term debt under Credit Facility | (5,600,000) | 173,500,000 |
Net payments under Revolving Loan portion of Prior Credit Facility | 0 | (48,603,000) |
Repayment of debt under Term Loan portion of Prior Credit Facility | 0 | (120,121,000) |
Remittance of employees' statutory tax withholdings for stock awards | (5,274,000) | (5,032,000) |
Cash dividends paid | (7,553,000) | (7,381,000) |
Payment of deferred financing costs | 0 | (1,813,000) |
Repayment of principal amounts under finance lease and other obligations | (314,000) | (1,189,000) |
Proceeds from issuance of employee stock purchase plan shares | 690,000 | 709,000 |
Payment of shelf registration costs | 0 | (148,000) |
Proceeds from exercises of stock options | 468,000 | 174,000 |
Net cash used in financing activities | (17,583,000) | (9,904,000) |
Net increase in cash and cash equivalents | 5,058,000 | 1,668,000 |
Cash and cash equivalents at beginning of period | 45,576,000 | 43,484,000 |
Cash and cash equivalents at end of period | 50,634,000 | 45,152,000 |
Cash paid during the period for: | ||
Interest | 4,546,000 | 5,853,000 |
Income taxes, net | 2,330,000 | 1,582,000 |
Non-cash investing and financing activities: | ||
Reclass of finance lease right-of-use assets to property, plant and equipment | 698,000 | 0 |
Cash dividends declared but unpaid (including dividend equivalents) | 2,635,000 | 2,653,000 |
Accrued additions to property, plant and equipment | 1,201,000 | 1,248,000 |
Common stock issued for acquisitions | 11,575,000 | 5,606,000 |
Accruals related to acquisitions | $ 4,020,000 | $ 0 |
General
General | 9 Months Ended |
Apr. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
General | General The accompanying condensed consolidated financial statements of Comtech Telecommunications Corp. and its subsidiaries ("Comtech," "we," "us," or "our") as of and for the three and nine months ended April 30, 2020 and 2019 are unaudited. In the opinion of management, the information furnished reflects all material adjustments (which include normal recurring adjustments) necessary for a fair presentation of the results for the unaudited interim periods. Our results of operations for such periods are not necessarily indicative of the results of operations to be expected for the full fiscal year. The preparation of our condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires us to make estimates and assumptions that affect the reported amount of assets and liabilities, and disclosure of contingent assets and liabilities, at the date of the condensed consolidated financial statements, and the reported amounts of net sales and expenses during the reported period. Actual results may differ from those estimates. Our condensed consolidated financial statements should be read in conjunction with our audited consolidated financial statements, filed with the Securities and Exchange Commission ("SEC"), for the fiscal year ended July 31, 2019 and the notes thereto contained in our Annual Report on Form 10-K, and all of our other filings with the SEC. As disclosed in more detail in Note (15) - " Segment Information ," we manage our business in two reportable segments: Commercial Solutions and Government Solutions. Impact of Coronavirus Disease 2019 ("COVID-19") on Our Business Our third quarter of fiscal 2020, running from February 1 through April 30, 2020, corresponded precisely with the period in which worldwide restrictions on business activities were in force due to COVID-19, which was declared a pandemic by the World Health Organization in March 2020 and a national emergency by the U.S. government. As a result, we experienced significant order delays and lower net sales. In response, we implemented a variety of cost saving measures, including reducing global headcount by approximately 10% , reducing salaries, suspending merit increases and eliminating certain discretionary expenses. Severance costs relating to these actions were not material and cost reduction efforts continue. Although we are deemed an essential business by the U.S. government, for the safety of our employees, customers, partners and suppliers, we have implemented remote working arrangements, curtailed most business travel, and established social distancing safeguards at our facilities. We expect that such precautions will remain in effect for as long as government advisories recommend. Although the COVID-19 pandemic is by no means over and a second wave of COVID-19 could again alter the business landscape, we believe that the pandemic’s worst impact on our business is largely behind us. Our long-term fundamentals remain strong, as we believe we are well-positioned for growth as business conditions meaningfully improve. |
Acquisitions
Acquisitions | 9 Months Ended |
Apr. 30, 2020 | |
Business Combinations [Abstract] | |
Acquisitions | Acquisitions Solacom Technologies Inc. On February 28, 2019 , we completed our acquisition of Solacom Technologies Inc. ("Solacom"), pursuant to the Arrangement Agreement, dated as of January 7, 2019 , by and among Solacom, Comtech and Solar Acquisition Corp., a Canadian corporation and a direct, wholly-owned subsidiary of Comtech. Solacom is a leading provider of Next Generation 911 ("NG-911") solutions for public safety agencies. The acquisition of Solacom was a significant step in our strategy of enhancing our public safety and location technologies. The acquisition had an aggregate purchase price for accounting purposes of $32,934,000 , of which $27,328,000 was settled in cash and $5,606,000 was settled with the issuance of 208,669 shares of Comtech’s common stock. The fair value of consideration transferred in connection with this acquisition was $31,489,000 , which was net of $1,445,000 of cash acquired. The cash portion of the purchase price was funded principally through borrowings under our Credit Facility. We accounted for the acquisition of Solacom under the acquisition method of accounting in accordance with FASB ASC 805, "Business Combinations" ("ASC 805"). The purchase price was allocated to the assets acquired and liabilities assumed, based on their fair value as of February 28, 2019 , pursuant to the business combination accounting rules and was finalized as of January 31, 2020. Acquisition plan expenses were not included as a component of consideration transferred and were expensed in the period incurred. Pro forma financial information was not disclosed, as the acquisition was not material. GD NG-911 Business On April 29, 2019 , we completed the acquisition of a state and local government NG-911 business pursuant to the Asset Purchase Agreement, dated as of April 29, 2019 , by and among General Dynamics Information Technology, Inc., Comtech and Comtech NextGen LLC, a Delaware limited liability company and indirect, wholly-owned subsidiary of Comtech. The acquisition of this NG-911 business (the "GD NG-911 business") had a final cash purchase price of $11,013,000 . In connection with this acquisition, we also announced an award of a five -year contract to develop, implement and operate a NG-911 emergency communications system for a Northeastern state. Immediately after our announcement of this acquisition, we hired approximately sixty GD NG-911 employees and completed the integration of this business into our Commercial Solutions segment’s public safety and location technologies product line. The acquisition, contract award and hiring of talented employees are expected to strengthen Comtech’s position in the growing NG-911 solutions market. We accounted for the acquisition of this business under the acquisition method of accounting in accordance with FASB ASC 805. The purchase price was allocated to the assets acquired and liabilities assumed, based on their fair value as of April 29, 2019 , pursuant to the business combination accounting rules and was finalized as of April 29, 2020. Acquisition plan expenses were not included as a component of consideration transferred and were expensed in the period incurred. Pro forma financial information is not disclosed, as the acquisition is not material. CGC Technology Limited On January 27, 2020, we completed the acquisition of CGC Technology Limited ("CGC"), a privately held company located in the United Kingdom, pursuant to the Share Purchase Agreement, dated as of January 27, 2020. CGC is a leading provider of high precision full motion fixed and mobile X/Y satellite tracking antennas, reflectors, radomes and other ground station equipment around the world. The acquisition of CGC brought established relationships with several top-tier European aerospace companies and other government entities, and we expect CGC to participate in the anticipated growth in the number of low Earth orbit ("LEO") and medium Earth orbit ("MEO") satellite constellations. The acquisition has a preliminary purchase price for accounting purposes of $23,650,000 , of which $12,075,000 was payable in cash and $11,575,000 was payable by the issuance of 323,504 shares of Comtech’s common stock at a volume weighted average stock price of $35.78 . The fair value of consideration transferred in connection with this acquisition was $22,740,000 , which was net of $160,000 of cash acquired and $750,000 payable by us upon the first anniversary of the closing of the transaction, subject to certain conditions. The preliminary purchase price for accounting purposes is subject to finalization. We are accounting for the acquisition of CGC under the acquisition method of accounting in accordance with FASB ASC 805. The purchase price was allocated to the assets acquired and liabilities assumed, based on their preliminary fair value as of January 27, 2020, pursuant to the business combination accounting rules. Acquisition plan expenses were not included as a component of consideration transferred and were expensed in the period incurred. Our condensed consolidated statements of operations for the three and nine months ended April 30, 2020 include a nominal amount of revenue contribution from CGC. Pro forma financial information is not disclosed, as the acquisition is not material. The following table summarizes the preliminary fair value of the assets acquired and liabilities assumed in connection with the CGC acquisition: Purchase Price Allocation (1) Measurement Period Adjustments Purchase Price Allocation (as adjusted) Payable in cash $ 12,075,000 — $ 12,075,000 Payable in common stock issued by Comtech 11,575,000 — 11,575,000 Preliminary purchase price at fair value $ 23,650,000 — $ 23,650,000 Preliminary allocation of aggregate purchase price: Cash and cash equivalents $ 160,000 — $ 160,000 Current assets 3,336,000 1,054,000 4,390,000 Property, plant and equipment 1,457,000 — 1,457,000 Operating lease assets 924,000 — 924,000 Deferred tax assets, non-current 588,000 487,000 1,075,000 Contract liabilities — (6,890,000 ) (6,890,000 ) Accrued warranty obligations (1,000,000 ) — (1,000,000 ) Other current liabilities (7,060,000 ) 862,000 (6,198,000 ) Non-current liabilities (1,329,000 ) — (1,329,000 ) Net tangible liabilities at preliminary fair value $ (2,924,000 ) (4,487,000 ) $ (7,411,000 ) Identifiable intangibles, deferred taxes and goodwill: Estimated Useful Lives Technology $ 5,000,000 — $ 5,000,000 20 years Customer relationships 7,000,000 (500,000 ) 6,500,000 15 years Trade name 800,000 — 800,000 5 years Deferred tax liabilities (2,176,000 ) 85,000 (2,091,000 ) Goodwill 15,950,000 4,902,000 20,852,000 Indefinite Preliminary allocation of aggregate purchase price $ 23,650,000 — $ 23,650,000 (1) As reported in the Company's Quarterly Report on Form 10-Q for the six months ended January 31, 2020. The acquired identifiable intangible assets are being amortized on a straight-line basis, which we believe approximates the pattern in which the assets are utilized over their estimated useful lives. The preliminary fair value of customer relationships (which include acquired backlog) was primarily based on the value of the discounted cash flows that the related intangible asset could be expected to generate in the future. The preliminary fair value of technology and trade name was based on the discounted capitalization of royalty expense saved because we now own the assets. Among the factors contributing to the recognition of goodwill, as a component of the preliminary purchase price allocation, were synergies in products and technologies and the addition of a skilled, assembled workforce. This goodwill has been assigned to our Government Solutions segment based on specific identification and is generally not deductible for income tax purposes. The allocation of the preliminary purchase price shown in the above table was based upon a preliminary valuation and estimates and assumptions that are subject to change within the purchase price allocation period, generally one year from the acquisition date. The primary areas of the purchase price allocation not yet finalized include the purchase price (due to potential indemnification obligations of the seller under the Share Purchase Agreement), a final assessment of assets acquired and liabilities assumed, including intangible assets and their remaining useful lives, accrued warranty obligations, income taxes and residual goodwill. UHP Networks Inc. In November 2019, we entered into an agreement to acquire UHP Networks Inc. and its sister company (together, "UHP"), a leading provider of innovative and disruptive satellite ground station solutions. In June 2020, we agreed with UHP to amend the terms of the agreement. Under the amended purchase agreement, the total aggregate purchase price has been reduced by approximately 24% from $50,000,000 to $38,000,000 (of which we anticipate $5,000,000 to be paid in cash with the remaining balance payable in Comtech common stock, cash, or a combination of both, as we may elect at the time of closing). We believe that our acquisition of UHP will be a significant step in enhancing our solutions offerings for the satellite ground station market. The transaction is subject to customary closing conditions, including necessary regulatory approval to allow us to purchase UHP's sister company which is headquartered in Moscow. Gilat Satellite Networks Ltd. On January 29, 2020, we entered into an Agreement and Plan of Merger (the "Merger Agreement") with Gilat Satellite Networks Ltd. ("Gilat"), a worldwide leader in satellite networking technology, solutions and services with market leading positions in the satellite ground station and in-flight connectivity solutions markets and deep expertise in operating large network infrastructures. Under the terms of the Merger Agreement, Comtech will acquire Gilat by way of a merger of Comtech's newly formed subsidiary with and into Gilat, with Gilat surviving the merger as a wholly-owned subsidiary of Comtech. Pursuant to the Merger Agreement, each Gilat ordinary share will be converted into the right to receive consideration of (i) $7.18 in cash, without interest, plus (ii) 0.08425 of a share of Comtech common stock, with cash payable in lieu of fractional shares. Based on such consideration, on January 29, 2020, the date we entered into the Merger Agreement, Gilat had an enterprise value of approximately $532,500,000 . During the twelve months ended December 31, 2019, Gilat reported revenue of $263,492,000 with GAAP operating income of $25,572,000 . As of December 31, 2019, Gilat had approximately $74,778,000 of unrestricted cash and cash equivalents and debt of approximately $8,096,000 . We expect to fund the cash portion of the acquisition by redeploying a portion of both our and Gilat's unrestricted cash and cash equivalents, with the remaining funds provided by a new $800,000,000 secured credit facility, which is discussed further in Note (11) - "Credit Facility." In connection with the acquisition of Gilat, we expect to incur transaction related expenses including certain compensatory and other merger related payments, professional fees and debt related costs. We preliminarily estimate that these expenses will approximate $31,678,000 , some of which were expensed as of April 30, 2020 , others to be expensed upon closing, and others to be expensed over time following the closing or capitalized in accordance with purchase accounting rules. Pursuant to accounting rules, the acquisition is expected to result in a material increase in annual amortization expense related to intangibles and possible other fair value adjustments. Our acquisition of Gilat remains subject to certain conditions to closing, including regulatory approval in Russia. In May 2020, we received notification from the Federal Antimonopoly Service of the Russian Federation that it was extending the review period for our application pending a decision under the Foreign Investment Law to determine whether approval is required from the Chairman of the Russian Government Commission for Supervising Foreign Investments. NG-911, Inc. On February 21, 2020, we completed our acquisition of NG-911, Inc. (“NG-911”), a privately-held company based in Iowa, Illinois and Missouri, pursuant to a stock purchase agreement dated December 27, 2019. NG-911 is a pioneer in providing next generation 911 solutions, including those designed by Comtech Solacom Technologies, Inc., to public safety agencies in the Midwest. Of the $1,188,000 total purchase price, $781,000 was paid in cash at closing, with the remaining $407,000 subject to an earn-out payable over a five -year period, subject to customary post-closing adjustments. The acquisition allows us to cost-effectively expand sales of our industry leading Solacom Guardian call management solutions for public safety. Pro forma financial information was not disclosed, as the acquisition was not material. |
Adoption of Accounting Standard
Adoption of Accounting Standards and Updates | 9 Months Ended |
Apr. 30, 2020 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
Adoption of Accounting Standards and Updates | Adoption of Accounting Standards and Updates We are required to prepare our condensed consolidated financial statements in accordance with the Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") which is the source for all authoritative U.S. generally accepted accounting principles, which is commonly referred to as "GAAP." The FASB ASC is subject to updates by the FASB, which are known as Accounting Standards Updates ("ASUs"). During the nine months ended April 30, 2020 , we adopted: • FASB ASU No. 2016-02 Leases (Topic 842). See Note (12) - "Leases" for further information. • FASB ASU No. 2017-11, which provides guidance on the accounting for certain financial instruments with embedded features that result in the strike price of the instrument or embedded conversion option being reduced on the basis of the pricing of future equity offerings (commonly referred to as "down round" features). On August 1, 2019, we adopted this ASU. Our adoption did not have any impact on our condensed consolidated financial statements and disclosures, as we did not have any financial instruments with such "down round" features. • FASB ASU No. 2017-12, which expands and refines hedge accounting for both non-financial and financial risk components and simplifies and aligns the recognition and presentation of the effects of the hedging instrument and the hedged item in the financial statements. On August 1, 2019, we adopted this ASU. Our adoption did not have any impact on our condensed consolidated financial statements and disclosures, as we are not a party to any such hedging transactions. • FASB ASU No. 2018-07, which expands the scope of ASC 718 to include certain share-based payment transactions for acquiring goods and services from nonemployees. On August 1, 2019, we adopted this ASU. Our adoption did not have any impact on our condensed consolidated financial statements and disclosures, as we did not have any outstanding share-based awards with nonemployees that required remeasurement. • FASB ASU No. 2018-16, which expands the list of eligible U.S. benchmark interest rates permitted in the application of hedge accounting due to broad concerns about the long-term sustainability of the LIBO Rate. This ASU adds the Overnight Index Swap ("OIS") rate, based on the Secured Overnight Financing Rate ("SOFR"), as an eligible U.S. benchmark interest rate. On August 1, 2019, we adopted this ASU. Our adoption did not have any impact on our condensed consolidated financial statements and disclosures, as we are not a party to any such hedging transactions. |
Revenue (Notes)
Revenue (Notes) | 9 Months Ended |
Apr. 30, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | Revenue In accordance with FASB ASC 606 - Revenue from Contracts with Customers ("ASC 606"), we record revenue in an amount that reflects the consideration to which we expect to be entitled in exchange for goods or services promised to customers. Under ASC 606, we follow a five-step model to: (1) identify the contract with our customer; (2) identify our performance obligations in our contract; (3) determine the transaction price for our contract; (4) allocate the transaction price to our performance obligations; and (5) recognize revenue using one of the following two methods: • Over time - We recognize revenue using the over time method when there is a continuous transfer of control to the customer over the contractual period of performance. This generally occurs when we enter into a long-term contract relating to the design, development or manufacture of complex equipment or technology platforms to a buyer’s specification (or to provide services related to the performance of such contracts). Continuous transfer of control is typically supported by contract clauses which allow our customers to unilaterally terminate a contract for convenience, pay for costs incurred plus a reasonable profit and take control of work-in-process. Revenue recognized over time is generally based on the extent of progress toward completion of the related performance obligations. The selection of the method to measure progress requires judgment and is based on the nature of the products or services provided. In certain instances, typically for firm fixed-price contracts, we use the cost-to-cost measure because it best depicts the transfer of control to the customer which occurs as we incur costs on our contracts. Under the cost-to-cost measure, the extent of progress toward completion is measured based on the ratio of costs incurred to date to the total estimated costs at completion, including warranty costs. Revenues, including estimated fees or profits, are recorded proportionally as costs are incurred. Costs to fulfill generally include direct labor, materials, subcontractor costs, other direct costs and an allocation of indirect costs. When these contracts are modified, the additional goods or services are generally not distinct from those already provided. As a result, these modifications form part of an existing contract and we must update the transaction price and our measure of progress for the single performance obligation and recognize a cumulative catch-up to revenue and gross profits. For over time contracts using a cost-to-cost measure of progress, we have an estimate at completion ("EAC") process in which management reviews the progress and execution of our performance obligations. This EAC process requires management judgment relative to assessing risks, estimating contract revenue and costs, and making assumptions for schedule and technical issues. Since certain contracts extend over a long period of time, the impact of revisions in revenue and or cost estimates during the progress of work may impact current period earnings through a cumulative adjustment. Additionally, if the EAC process indicates a loss, a provision is made for the total anticipated loss in the period that it becomes evident. Contract revenue and cost estimates for significant contracts are generally reviewed and reassessed at least quarterly. The cost-to-cost method is principally used to account for contracts in our mission-critical technologies and high-performance transmission technologies product lines and, to a lesser extent, certain location-based and messaging infrastructure contracts in our public safety and location technologies product line. For service-based contracts in our public safety and location technologies product line, we recognize revenue over time. These services are typically recognized as a series of services performed over the contract term using the straight-line method, or based on our customers’ actual usage of the networks and platforms which we provide. • Point in time - When a performance obligation is not satisfied over time, we must record revenue using the point in time accounting method which generally results in revenue being recognized upon shipment or delivery of a promised good or service to a customer. This generally occurs when we enter into short-term contracts or purchase orders where items are provided to customers with relatively quick turn-around times. Modifications to such contracts and or purchase orders, which typically provide for additional quantities or services, are accounted for as a new contract because the pricing for these additional quantities or services are based on standalone selling prices. Point in time accounting is principally applied to contracts in our satellite ground station technologies product line (which includes satellite modems, solid-state and traveling wave tube amplifiers) and certain contracts for our solid-state, high-power amplifiers in our high-performance transmission technologies product line. Point in time accounting is also applied to certain contracts in our mission-critical technologies product line. The contracts related to these product lines do not meet the requirements for over time revenue recognition because our customers cannot utilize the equipment for its intended purpose during any phase of our manufacturing process; customers do not simultaneously receive and or consume the benefits provided by our performance; customers do not control the asset (i.e., prior to delivery, customers cannot direct the use of the asset, sell or exchange the equipment, etc.); and, although many of our contracts have termination for convenience clauses and or an enforceable right to payment for performance completed to date, our performance creates an asset with an alternative use through the point of delivery. In determining that our equipment has alternative use, we considered the underlying manufacturing process for our products. In the early phases of manufacturing, raw materials and work in process (including subassemblies) consist of common parts that are highly fungible among many different types of products and customer applications. Finished products are either configured to our standard configuration or based on our customers’ specifications. Finished products, whether built to our standard specification or to a customers’ specification, can be sold to a variety of customers and across many different end use applications with minimal rework, if needed, and without incurring a significant economic loss. When identifying a contract with our customer, we consider when it has approval and commitment from both parties, if the rights of the parties are identified, if the payment terms are identified, if it has commercial substance and if collectability is probable. When identifying performance obligations, we consider whether there are multiple promises and how to account for them. In our contracts, multiple promises are separated if they are distinct, both individually and in the context of the contract. If multiple promises in a contract are highly interrelated or comprise a series of distinct services performed over time, they are combined into a single performance obligation. In some cases, we may also provide the customer with an additional service-type warranty, which we recognize as a separate performance obligation. Service-type warranties do not represent a significant portion of our consolidated net sales. When service-type warranties represent a separate performance obligation, the revenue is deferred and recognized ratably over the extended warranty period. Our contracts, from time-to-time, may also include options for additional goods and services. To date, these options have not represented material rights to the customer as the pricing for them reflects standalone selling prices. As a result, we do not consider options we offer to be performance obligations for which we must allocate a portion of the transaction price. In many cases, we provide assurance-type warranty coverage for some of our products for a period of at least one year from the date of delivery. When identifying the transaction price, we typically utilize the contract's stated price as a starting point. The transaction price in certain arrangements may include estimated amounts of variable consideration, including award fees, incentive fees or other provisions that can either increase or decrease the transaction price. We estimate variable consideration as the amount to which we expect to be entitled, and we include estimated amounts in the transaction price to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur when the estimation uncertainty is resolved. The estimation of this variable consideration and determination of whether to include estimated amounts in the transaction price are based largely on an assessment of our anticipated performance and all information (e.g., historical, current and forecasted) that is reasonably available to us. When allocating the contract’s transaction price, we consider each distinct performance obligation. For contracts with multiple performance obligations, we allocate the contract’s transaction price to each performance obligation using our best estimate of the standalone selling price of each distinct good or service in the contract. We determine standalone selling price based on the price at which the performance obligation is sold separately. If the standalone selling price is not observable through past transactions, we estimate the standalone selling price taking into account available information such as market conditions, including geographic or regional specific factors, competitive positioning, internal costs, profit objectives and internally approved pricing guidelines related to the performance obligations. Almost all of our contracts with customers are denominated in U.S. dollars and typically are either firm fixed-price or cost reimbursable type contracts (including fixed-fee, incentive-fee and time-and-material type contracts). In almost all of our contracts with customers, we are the principal in the arrangement and report revenue on a gross basis. Transaction prices for contracts with U.S. domestic and international customers are usually based on specific negotiations with each customer and in the case of the U.S. government, sometimes based on estimated or actual costs of providing the goods or services in accordance with applicable regulations. Sales by geography and customer type, as a percentage of consolidated net sales, are as follows: Three months ended April 30, Nine months ended April 30, 2020 2019 2020 2019 United States U.S. government 30.7 % 38.9 % 38.1 % 42.7 % Domestic 45.0 % 34.7 % 38.8 % 32.7 % Total United States 75.7 % 73.6 % 76.9 % 75.4 % International 24.3 % 26.4 % 23.1 % 24.6 % Total 100.0 % 100.0 % 100.0 % 100.0 % Sales to U.S. government customers include sales to the U.S. Department of Defense ("DoD"), intelligence and civilian agencies, as well as sales directly to or through prime contractors. Domestic sales include sales to commercial customers, as well as to U.S. state and local governments. Except for the U.S. government, there were no customers that represented more than 10.0% of consolidated net sales during the three and nine months ended April 30, 2020 and 2019 . International sales include sales to U.S. domestic companies for inclusion in products that are sold to international customers. Except for the U.S., no individual country (including sales to U.S. domestic companies for inclusion in products that are sold to a foreign country) represented more than 10.0% of consolidated net sales for the three and nine months ended April 30, 2020 and 2019 . The following tables summarize our disaggregation of revenue consistent with information reviewed by our chief operating decision-maker ("CODM") for the three and nine months ended April 30, 2020 and 2019 . We believe these categories best depict how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors which impact our business: Three months ended April 30, 2020 Nine months ended April 30, 2020 Commercial Solutions Government Solutions Total Commercial Solutions Government Solutions Total Geographical region and customer type U.S. government $ 7,230,000 34,268,000 $ 41,498,000 $ 41,167,000 136,941,000 $ 178,108,000 Domestic 51,499,000 9,314,000 60,813,000 158,856,000 22,588,000 181,444,000 Total United States 58,729,000 43,582,000 102,311,000 200,023,000 159,529,000 359,552,000 International 19,582,000 13,228,000 32,810,000 68,724,000 38,766,000 107,490,000 Total $ 78,311,000 56,810,000 $ 135,121,000 $ 268,747,000 198,295,000 $ 467,042,000 Contract type Firm fixed price $ 77,553,000 39,079,000 $ 116,632,000 $ 265,318,000 128,677,000 $ 393,995,000 Cost reimbursable 758,000 17,731,000 18,489,000 3,429,000 69,618,000 73,047,000 Total $ 78,311,000 56,810,000 $ 135,121,000 $ 268,747,000 198,295,000 $ 467,042,000 Transfer of control Point in time $ 25,730,000 32,193,000 $ 57,923,000 $ 106,464,000 98,653,000 $ 205,117,000 Over time 52,581,000 24,617,000 77,198,000 162,283,000 99,642,000 261,925,000 Total $ 78,311,000 56,810,000 $ 135,121,000 $ 268,747,000 198,295,000 $ 467,042,000 Three months ended April 30, 2019 Nine months ended April 30, 2019 Commercial Solutions Government Solutions Total Commercial Solutions Government Solutions Total Geographical region and customer type U.S. government $ 17,229,000 49,133,000 $ 66,362,000 $ 52,360,000 159,346,000 $ 211,706,000 Domestic 48,248,000 10,875,000 59,123,000 134,178,000 27,910,000 162,088,000 Total United States 65,477,000 60,008,000 125,485,000 186,538,000 187,256,000 373,794,000 International 24,123,000 20,840,000 44,963,000 67,770,000 53,861,000 121,631,000 Total $ 89,600,000 80,848,000 $ 170,448,000 $ 254,308,000 241,117,000 $ 495,425,000 Contract type Firm fixed price $ 88,125,000 57,451,000 $ 145,576,000 $ 249,982,000 178,080,000 $ 428,062,000 Cost reimbursable 1,475,000 23,397,000 24,872,000 4,326,000 63,037,000 67,363,000 Total $ 89,600,000 80,848,000 $ 170,448,000 $ 254,308,000 241,117,000 $ 495,425,000 Transfer of control Point in time $ 43,935,000 44,078,000 $ 88,013,000 $ 127,912,000 141,883,000 $ 269,795,000 Over time 45,665,000 36,770,000 82,435,000 126,396,000 99,234,000 225,630,000 Total $ 89,600,000 80,848,000 $ 170,448,000 $ 254,308,000 241,117,000 $ 495,425,000 The timing of revenue recognition, billings and collections results in receivables, unbilled receivables and contract liabilities on our Condensed Consolidated Balance Sheet. Under typical payment terms for our contracts accounted for over time, amounts are billed as work progresses in accordance with agreed-upon contractual terms, either at periodic intervals (e.g., monthly) or upon achievement of contractual milestones. For certain contracts with provisions that are intended to protect customers in the event we do not satisfy our performance obligations, billings occur subsequent to revenue recognition, resulting in unbilled receivables. Contract assets increased $824,000 due to business combinations discussed in Note (2) - “ Acquisitions .” Under ASC 606, unbilled receivables constitute contract assets. There were no material impairment losses recognized on contract assets during the nine months ended April 30, 2020 and 2019 , respectively. On large long-term contracts, and for contracts with international customers that do not do business with us regularly, payment terms typically require advanced payments and deposits. Under ASC 606, payments received from customers in excess of revenue recognized to date results in a contract liability. These contract liabilities are not considered to represent a significant financing component of the contract because we believe these cash advances and deposits are generally used to meet working capital demands which can be higher in the earlier stages of a contract. Also, advanced payments and deposits provide us with some measure of assurance that the customer will perform on its obligations under the contract. Under the typical payment terms for our contracts accounted for at a point in time, costs are accumulated in inventory until the time of billing, which generally coincides with revenue recognition. Contract liabilities increased $6,208,000 due to business combinations discussed in Note (2) - “ Acquisitions .” Of the contract liability balance at July 31, 2019 and August 1, 2018, $31,000,000 and $30,061,000 was recognized as revenue during the nine months ended April 30, 2020 and 2019 , respectively. We recognize the incremental costs to obtain or fulfill a contract as an expense when incurred if the amortization period of the asset is one year or less. Incremental costs to obtain or fulfill contracts with an amortization period greater than one year were not material. As commissions payable to our internal sales and marketing employees or contractors are contingent upon multiple factors, such commissions are not considered direct costs to obtain or fulfill a contract with a customer and are expensed as incurred in selling, general and administrative expenses on our Condensed Consolidated Statements of Operations. As for commissions payable to our third-party sales representatives related to large long-term contracts, we do consider these types of commissions both direct and incremental costs to obtain and fulfill such contracts. Therefore, such commissions are included in total estimated costs at completion for such contracts and expensed over time through cost of sales on our Condensed Consolidated Statements of Operations. Remaining performance obligations represent the transaction price of firm orders for which work has not been performed as of the end of a fiscal period. Remaining performance obligations, which we refer to as backlog, exclude unexercised contract options and potential orders under indefinite delivery / indefinite quantity ("IDIQ") contracts. As of April 30, 2020 , the aggregate amount of the transaction price allocated to remaining performance obligations was $640,702,000 (which represents the amount of our consolidated backlog). We estimate that a substantial portion of our remaining performance obligations at April 30, 2020 will be completed and recognized as revenue during the next twenty-four month period, with the rest thereafter. During the three and nine months ended April 30, 2020 , revenue recognized from performance obligations satisfied, or partially satisfied, in previous periods (for example due to changes in the transaction price) was not material. |
Fair Value Measurements and Fin
Fair Value Measurements and Financial Instruments | 9 Months Ended |
Apr. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements and Financial Instruments | Fair Value Measurements and Financial Instruments Using the fair value hierarchy described in FASB ASC 820 " Fair Value Measurements and Disclosures," we valued our cash and cash equivalents using Level 1 inputs that were based on quoted market prices. We believe that the carrying amounts of our other current financial assets (such as accounts receivable) and other current liabilities (including accounts payable, accrued expenses and the current portion of our favorable AT&T warranty settlement) approximate their fair values due to their short-term maturities. See Note (9) - "Accrued Expenses and Other Current Liabilities" for further discussion of the favorable AT&T warranty settlement. The fair value of our Credit Facility that we entered into on October 31, 2018 approximates its carrying amount due to its variable interest rate and pricing grid that is dependent upon our leverage ratio as of the end of each fiscal quarter. As of April 30, 2020 and July 31, 2019 , other than the financial instruments discussed above, we had no other significant assets or liabilities included in our Condensed Consolidated Balance Sheets recorded at fair value, as such term is defined by FASB ASC 820. |
Earnings Per Share
Earnings Per Share | 9 Months Ended |
Apr. 30, 2020 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share Our basic earnings per share ("EPS") is computed based on the weighted average number of common shares (including vested but unissued stock units, share units, performance shares and restricted stock units ("RSUs")), outstanding during each respective period. Our diluted EPS reflects the dilution from potential common stock issuable pursuant to the exercise of equity-classified stock-based awards, if dilutive, outstanding during each respective period. Pursuant to FASB ASC 260 " Earnings Per Share, " equity-classified stock-based awards that are subject to performance conditions are not considered in our diluted EPS calculations until the respective performance conditions have been satisfied. When calculating our diluted earnings per share, we consider the amount an employee must pay upon assumed exercise of stock-based awards and the amount of stock-based compensation cost attributed to future services and not yet recognized. There were no repurchases of our common stock during the three or nine months ended April 30, 2020 or 2019 . See Note (18) - "Stockholders’ Equity" for more information. Weighted average stock options, RSUs and restricted stock outstanding of 1,440,000 and 1,674,000 for the three months ended April 30, 2020 and 2019 , respectively, and 642,000 and 1,103,000 for the nine months ended April 30, 2020 and 2019 , respectively, were not included in our diluted EPS calculation because their effect would have been anti-dilutive. Our EPS calculations exclude 203,000 and 246,000 weighted average performance shares outstanding for the three months ended April 30, 2020 and 2019 , respectively, and 201,000 and 242,000 for the nine months ended April 30, 2020 and 2019 , respectively, as the performance conditions have not yet been satisfied. However, net income (the numerator) for EPS calculations for each respective period, is reduced by the compensation expense related to these awards. The following table reconciles the numerators and denominators used in the basic and diluted EPS calculations: Three months ended April 30, Nine months ended April 30, 2020 2019 2020 2019 Numerator: Net (loss) income for basic calculation $ (3,989,000 ) 7,612,000 $ 5,894,000 18,906,000 Numerator for diluted calculation $ (3,989,000 ) 7,612,000 $ 5,894,000 18,906,000 Denominator: Denominator for basic calculation 24,982,000 24,192,000 24,730,000 24,074,000 Effect of dilutive securities: Stock-based awards — 138,000 162,000 189,000 Denominator for diluted calculation 24,982,000 24,330,000 24,892,000 24,263,000 |
Accounts Receivable
Accounts Receivable | 9 Months Ended |
Apr. 30, 2020 | |
Accounts Receivable Additional Disclosures [Abstract] | |
Accounts Receivable | Accounts Receivable Accounts receivable consist of the following at: April 30, 2020 July 31, 2019 Receivables from commercial and international customers $ 76,909,000 85,556,000 Unbilled receivables from commercial and international customers 17,919,000 20,469,000 Receivables from the U.S. government and its agencies 40,687,000 38,856,000 Unbilled receivables from the U.S. government and its agencies 4,202,000 2,018,000 Total accounts receivable 139,717,000 146,899,000 Less allowance for doubtful accounts 1,830,000 1,867,000 Accounts receivable, net $ 137,887,000 145,032,000 Unbilled receivables as of April 30, 2020 relate to contracts-in-progress for which revenue has been recognized, but for which we have not yet earned the right to bill the customer for work performed to date. Under ASC 606, unbilled receivables constitute contract assets. Management estimates that substantially all amounts not yet billed at April 30, 2020 will be billed and collected within one year . As of April 30, 2020 , the U.S. government (and its agencies) and Verizon Communications Inc. (through various divisions and, collectively, “Verizon”) represented 32.1% and 10.2% , respectively, of total accounts receivable. As of July 31, 2019 , except for the U.S. government (and its agencies), which represented 27.8% , there were no other customers which accounted for greater than 10.0% of total accounts receivable. |
Inventories
Inventories | 9 Months Ended |
Apr. 30, 2020 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories Inventories consist of the following at: April 30, 2020 July 31, 2019 Raw materials and components $ 60,203,000 53,959,000 Work-in-process and finished goods 38,070,000 40,576,000 Total inventories 98,273,000 94,535,000 Less reserve for excess and obsolete inventories 18,850,000 19,696,000 Inventories, net $ 79,423,000 74,839,000 As of April 30, 2020 and July 31, 2019 , the amount of inventory directly related to long-term contracts (including contracts-in-progress) was $6,410,000 and $4,053,000 , respectively, and the amount of inventory related to contracts from third-party commercial customers who outsource their manufacturing to us was $1,606,000 and $1,513,000 , respectively. |
Accrued Expenses and Other Curr
Accrued Expenses and Other Current Liabilities | 9 Months Ended |
Apr. 30, 2020 | |
Accrued Liabilities, Current [Abstract] | |
Accrued Expenses and Other Current Liabilities | Accrued Expenses and Other Current Liabilities Accrued expenses and other current liabilities consist of the following at: April 30, 2020 July 31, 2019 Accrued wages and benefits $ 23,473,000 23,295,000 Accrued contract costs 12,383,000 15,007,000 Accrued warranty obligations 15,504,000 15,968,000 Accrued legal costs 2,880,000 2,835,000 Accrued commissions and royalties 4,131,000 5,114,000 Other 25,190,000 16,365,000 Accrued expenses and other current liabilities $ 83,561,000 78,584,000 As discussed further in Note (12) - " Leases, " on August 1, 2019, we adopted Topic 842 and, as required by the new standard, reclassified $2,934,000 of accrued expenses and other current liabilities as follows: (i) $2,366,000 of short-term deferred rent liabilities related to operating leases were offset against the respective operating lease right-of-use assets; and (ii) the remaining $568,000 of estimated facility exit costs were reclassified to the current portion of operating lease liabilities. Accrued contract costs represent direct and indirect costs on contracts as well as estimates of amounts owed for invoices not yet received from vendors or reflected in accounts payable. Accrued warranty obligations as of April 30, 2020 relate to estimated liabilities for assurance-type warranty coverage that we provide to our customers. We generally provide warranty coverage for some of our products for a period of at least one year from the date of delivery. We record a liability for estimated warranty expense based on historical claims, product failure rates, consideration of contractual obligations, future costs to resolve software issues and other factors. Some of our product warranties are provided under long-term contracts, the costs of which are incorporated into our estimates of total contract costs. Changes in our accrued warranty obligations during the nine months ended April 30, 2020 and 2019 were as follows: Nine months ended April 30, 2020 2019 Balance at beginning of period $ 15,968,000 11,738,000 Reclass to contract liabilities (see below) — (1,679,000 ) Provision for warranty obligations 1,628,000 1,320,000 Additions (in connection with acquisitions) 1,000,000 6,431,000 Charges incurred (3,394,000 ) (4,828,000 ) Warranty settlement and reclass (see below) 302,000 1,281,000 Balance at end of period $ 15,504,000 14,263,000 On August 1, 2018, in connection with our adoption of ASC 606, $1,679,000 of accrued warranty obligations presented in the above table were reclassified to contract liabilities, as they represented deferred revenue related to service-type warranty performance obligations. Our current accrued warranty obligations at April 30, 2020 and July 31, 2019 include $2,604,000 and $3,999,000 , respectively, of warranty obligations for a small product line that we refer to as the TCS 911 call handling software solution. This solution was licensed to customers prior to our acquisition of TeleCommunication Systems, Inc. ("TCS"). During the fiscal year ended July 31, 2018, we entered into a full and final warranty settlement with AT&T, the largest customer/distributor of this product line, pursuant to which we issued thirty-six credits to AT&T of $153,000 which AT&T can apply on a monthly basis to purchases of solutions from us, beginning October 2017 through September 2020. As of April 30, 2020 , the total present value of these monthly credits is $748,000 , all of which is included in our current accrued warranty obligations on our Condensed Consolidated Balance Sheet. In connection with our acquisition of Solacom, the GD NG-911 business and CGC, we assumed warranty obligations related to certain contracts acquired. See Note (2) - "Acquisitions" for further information pertaining to these acquisitions. |
Prior Period Cost Reduction Act
Prior Period Cost Reduction Actions | 9 Months Ended |
Apr. 30, 2020 | |
Restructuring and Related Activities [Abstract] | |
Prior Period Cost Reduction Actions | Prior Period Cost Reduction Actions During the first quarter of fiscal 2019, we took steps to improve our future operating results and successfully consolidated our Government Solutions segment’s manufacturing facility located in Tampa, Florida with another facility that we maintain in Orlando, Florida. In doing so, during the nine months ended April 30, 2019 , we recorded $1,373,000 of facility exit costs in selling, general and administrative expenses in our Condensed Consolidated Statements of Operations. As discussed further in Note (12) - " Leases, " on August 1, 2019, we adopted Topic 842 and, as required by the new standard, reclassified $568,000 of estimated facility exit costs to the current portion of operating lease liabilities. During the second quarter of fiscal 2019, we began an evaluation and repositioning of our public safety and location technologies solutions in order to focus on providing higher margin solution offerings. To-date, we have ceased offering certain solutions, have worked with customers to wind-down certain legacy contracts and have not renewed certain contracts. In connection with this evaluation and repositioning, we recorded estimated contract settlement costs of $2,465,000 and $6,351,000 for the three and nine months ended April 30, 2019 , respectively. |
Credit Facility
Credit Facility | 9 Months Ended |
Apr. 30, 2020 | |
Line of Credit Facility [Abstract] | |
Credit Facility | Credit Facility On October 31, 2018 , we entered into a First Amended and Restated Credit Agreement (the "Credit Facility") with a syndicate of lenders, replacing our prior Credit Agreement dated as of February 23, 2016 (as amended by that certain First Amendment, dated as of June 6, 2017 (the "Prior Credit Facility")). In connection with the establishment of our Credit Facility, during the three months ended October 31, 2018, we wrote-off $3,217,000 of deferred financing costs primarily related to the Term Loan Facility portion of our Prior Credit Facility and capitalized deferred financing costs of $1,813,000 related to the Credit Facility. The Credit Facility provides a senior secured loan facility of up to $550,000,000 consisting of: (i) a revolving loan facility ("Revolving Loan Facility") with a borrowing limit of $300,000,000 ; (ii) an accordion feature allowing us to borrow up to an additional $250,000,000 ; (iii) a $35,000,000 letter of credit sublimit; and (iv) a swingline loan credit sublimit of $25,000,000 . The Credit Facility matures on October 31, 2023 (the "Revolving Maturity Date"). If we issue new unsecured debt in excess of $5,000,000 with a maturity date that is less than 91 days from October 31, 2023 , the Revolving Maturity Date would automatically accelerate so that it would be 91 days earlier than the maturity date of the new unsecured debt. The proceeds of the Credit Facility were used, in part, to repay in full the outstanding borrowings under the Prior Credit Facility, and additional proceeds of the Credit Facility are expected to be used by us for working capital and other general corporate purposes. As of April 30, 2020 , the amount outstanding under our Credit Facility was $159,400,000 , which is reflected in the non-current portion of long-term debt on our Condensed Consolidated Balance Sheet. At April 30, 2020 , we had $2,672,000 of standby letters of credit outstanding under our Credit Facility related to guarantees of future performance on certain customer contracts and no outstanding commercial letters of credit. During the nine months ended April 30, 2020 , we had outstanding balances under the Credit Facility ranging from $137,000,000 to $174,000,000 . As of April 30, 2020 , total net deferred financing costs related to the Credit Facility were $2,575,000 and are being amortized over the term of our Credit Facility through October 31, 2023 . Interest expense related to our Credit Facility, including amortization of deferred financing costs, recorded during the three months ended April 30, 2020 and 2019 was $1,470,000 and $2,067,000 , respectively. Interest expense related to our credit facilities, including amortization of deferred financing costs, recorded during the nine months ended April 30, 2020 and 2019 was $4,795,000 and $6,780,000 , respectively. The amount for the nine months ended April 30, 2019 relates to both our Prior Credit Facility and our existing Credit Facility. Our blended interest rate approximated 3.73% and 5.00% , respectively, for the three months ended April 30, 2020 and 2019 , and approximated 4.24% and 5.36% , respectively, for the nine months ended April 30, 2020 and 2019 . Borrowings under the Credit Facility shall be either: (i) Alternate Base Rate borrowings, which bear interest from the applicable borrowing date at a rate per annum equal to (x) the greatest of (a) the Prime Rate (as defined) in effect on such day, (b) the Federal Funds Effective Rate (as defined) in effect on such day plus 1/2 of 1.00% per annum and (c) the Adjusted LIBO Rate (as defined) on such day (or, if such day is not a business day, the immediately preceding business day) plus 1.00% per annum, plus (y) the Applicable Rate (as defined), or (ii) Eurodollar borrowings, which bear interest from the applicable borrowing date at a rate per annum equal to (x) the Adjusted LIBO Rate for such interest period plus (y) the Applicable Rate. Determination of the Applicable Rate is based on a pricing grid that is dependent upon our Secured Leverage Ratio (as defined) as of the end of each fiscal quarter for which consolidated financial statements have been most recently delivered. The Credit Facility contains customary representations, warranties and affirmative covenants. The Credit Facility also contains customary negative covenants, subject to negotiated exceptions, including but not limited to: (i) liens, (ii) investments, (iii) indebtedness, (iv) significant corporate changes, including mergers and acquisitions, (v) dispositions, (vi) restricted payments, including stockholder dividends, and (vii) certain other restrictive agreements. The Credit Facility also contains certain financial covenants and customary events of default (subject to grace periods, as appropriate), such as payment defaults, cross-defaults to other material indebtedness, bankruptcy and insolvency, the occurrence of a defined change in control and the failure to observe the negative covenants and other covenants related to the operation of our business. In addition, under certain circumstances, we may be required to enter into amendments to the Credit Facility in connection with any further syndication of the Credit Facility. The Credit Facility provides for, among other things: (i) no scheduled payments of principal until maturity; (ii) a maximum Secured Leverage Ratio of 3.75 x trailing twelve months ("TTM") Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization ("Adjusted EBITDA") and a Maximum Total Leverage Ratio of 4.50 x TTM Adjusted EBITDA, each with no step downs; and (iii) a Minimum Interest Expense Coverage Ratio of 3.25 x TTM Adjusted EBITDA. As of April 30, 2020 , our Secured Leverage Ratio was 1.93 x TTM Adjusted EBITDA compared to the maximum allowable Secured Leverage Ratio of 3.75 x TTM Adjusted EBITDA. Our Interest Expense Coverage Ratio as of April 30, 2020 was 13.37 x TTM Adjusted EBITDA compared to the Minimum Interest Expense Coverage Ratio of 3.25 x TTM Adjusted EBITDA. Given our expected future business performance, we anticipate maintaining compliance with the terms and financial covenants in our Credit Facility for the foreseeable future. The obligations under the Credit Facility are guaranteed by certain of our domestic subsidiaries (the "Guarantors"). As collateral security under the Credit Facility and the guarantees thereof, we and the Guarantors have granted to the administrative agent, for the benefit of the lenders, a lien on, and first priority security interest in, substantially all of our tangible and intangible assets. On December 6, 2018, we entered into the first amendment to the Credit Facility. The purpose of the amendment is to provide for a mechanism to replace the LIBO Rate for Eurodollar borrowings with an alternative benchmark interest rate, should the LIBO Rate generally become unavailable in the future on an other-than-temporary basis. Capitalized terms used but not defined herein have the meanings set forth for such terms in the Credit Facility and the Prior Credit Facility, which have been documented and filed with the SEC. As discussed in " Note (2) - Acquisitions ," in connection with the Merger Agreement with Gilat, we entered into an $800,000,000 commitment letter with major banking partners for a new secured credit facility (the "Gilat Acquisition Related Credit Facility"), the terms of which are expected to be finalized on or prior to the closing of the merger. The Gilat Acquisition Related Credit Facility is expected to replace our existing Credit Facility. |
Leases
Leases | 9 Months Ended |
Apr. 30, 2020 | |
Leases [Abstract] | |
Leases | Leases On August 1, 2019, we adopted ASU No. 2016-02 - Leases (Topic 842), which requires the recognition of lease rights and obligations as assets and liabilities on the balance sheet. Previously, operating leases were not recognized on the balance sheet. As we elected the modified retrospective adoption method, prior-period information was not restated. We also elected the transition package of practical expedients available in the standard, which permits us to not reassess under the new standard our prior conclusions about lease identification, classification and initial direct costs. As part of our adoption, however, we did not elect to use the hindsight or land easements practical expedients. On August 1, 2019, in connection with our adoption of Topic 842, we recognized $35,825,000 of operating lease right-of-use ("ROU") assets (net of a $3,023,000 deferred rent liability that existed as of August 1, 2019 under prior applicable GAAP) and $38,848,000 of related liabilities. Except for the recording of the ROU assets and lease liabilities on our Condensed Consolidated Balance Sheet, and the expanded disclosures about our leasing activities, our adoption did not have a material impact on our condensed consolidated financial statements. Our adoption also did not result in any cumulative-effect adjustment to opening retained earnings. Our leases historically relate to the leasing of facilities and equipment. We determine at inception whether an arrangement is, or contains, a lease and whether the lease should be classified as an operating or a financing lease. At lease commencement, we recognize an ROU asset and lease liability based on the present value of the future lease payments over the estimated lease term. We have elected to not recognize an ROU asset or lease liability for any leases with terms of twelve months or less. Instead, for such short-term leases, we recognize lease expense on a straight-line basis over the lease term. Certain of our leases include options to extend the term of the lease or to terminate the lease early. When it is reasonably certain that we will exercise a renewal option or will not exercise a termination option, we include the impact of exercising or not exercising such option, respectively, in the estimate of the lease term. As our lease agreements do not explicitly state the discount rate implicit in the lease, we use our incremental borrowing rate ("IBR") on the commencement date to calculate the present value of future lease payments. Such IBR represents our estimated rate of interest to borrow on a collateralized basis over a term commensurate with the expected lease term. Some of our leases include payments that are based on the Consumer Price Index ("CPI") or other similar indices. These variable lease payments are included in the calculation of the ROU asset and lease liability using the index as of the lease commencement date. Other variable lease payments, such as common area maintenance, property taxes, and usage-based amounts, are required by Topic 842 to be excluded from the ROU asset and lease liability and expensed as incurred. In addition to the present value of the future lease payments, the calculation of the ROU asset would also consider, to the extent applicable, any deferred rent upon adoption, lease pre-payments or initial direct costs of obtaining the lease (e.g., such as commissions). For all classes of leased assets, we elected the practical expedient to not separate lease components (i.e., the actual item being leased, such as the facility or piece of equipment) from non-lease components (i.e., the distinct elements of a contract not related to securing the use of the leased asset, such as common area maintenance and consumable supplies). Certain of our facility lease agreements (which are classified as operating leases) contain rent holidays or rent escalation clauses. For rent holidays and rent escalation clauses during the lease term, we record rental expense on a straight-line basis over the term of the lease. As of April 30, 2020 , none of our leases contained a residual value guarantee and covenants included in our lease agreements are customary for the types of facilities and equipment being leased. The components of lease expense are as follows: Three months ended April 30, 2020 Nine months ended April 30, 2020 Finance lease expense: Amortization of ROU assets $ — $ 152,000 Interest on lease liabilities — 3,000 Operating lease expense 2,733,000 8,069,000 Short-term lease expense 798,000 2,539,000 Variable lease expense 1,004,000 3,013,000 Sublease income (5,000 ) (5,000 ) Total lease expense $ 4,530,000 $ 13,771,000 Additional information related to leases is as follows: Nine months ended April 30, 2020 Cash paid for amounts included in the measurement of lease liabilities: Operating leases - Operating cash outflows $ 8,681,000 Finance leases - Operating cash outflows 3,000 Finance leases - Financing cash outflows 300,000 ROU assets obtained in the exchange for lease liabilities (non-cash): Operating leases $ 3,096,000 The following table is a reconciliation of future cash flows relating to operating lease liabilities presented on our Condensed Consolidated Balance Sheet as of April 30, 2020 : Operating Remaining portion of fiscal 2020 $ 2,666,000 Fiscal 2021 9,116,000 Fiscal 2022 7,730,000 Fiscal 2023 6,231,000 Fiscal 2024 4,878,000 Thereafter 7,013,000 Total future undiscounted cash flows 37,634,000 Less: Present value discount 3,289,000 Lease liabilities $ 34,345,000 Weighted-average remaining lease terms (in years) 4.71 Weighted-average discount rate 4.04 % We lease our Melville, New York production facility from a partnership controlled by our CEO and Chairman. Lease payments made during the nine months ended April 30, 2020 were $486,000 . The current lease provides for our use of the premises as they exist through December 2021 with an option for an additional ten years. The annual rent of the facility for calendar year 2020 is $657,000 and is subject to customary adjustments. We have a right of first refusal in the event of a sale of the facility. As of April 30, 2020 , we do not have any rental commitments that have not commenced. As we have not restated prior year information given our method of adopting the new standard, the following represents our future minimum lease payments for operating leases and capital leases as of July 31, 2019 under ASC Topic 840 and as reported in our Form 10-K filed with the SEC on September 24, 2019: Operating Capital Total Fiscal 2020 $ 11,812,000 789,000 $ 12,601,000 Fiscal 2021 8,723,000 — 8,723,000 Fiscal 2022 7,343,000 — 7,343,000 Fiscal 2023 5,776,000 — 5,776,000 Fiscal 2024 3,430,000 — 3,430,000 Thereafter 7,130,000 — 7,130,000 Total $ 44,214,000 789,000 $ 45,003,000 Less amount representing interest * 32,000 32,000 Present value of net minimum lease payments * $ 757,000 $ 44,971,000 *Not applicable for operating leases |
Leases | Leases On August 1, 2019, we adopted ASU No. 2016-02 - Leases (Topic 842), which requires the recognition of lease rights and obligations as assets and liabilities on the balance sheet. Previously, operating leases were not recognized on the balance sheet. As we elected the modified retrospective adoption method, prior-period information was not restated. We also elected the transition package of practical expedients available in the standard, which permits us to not reassess under the new standard our prior conclusions about lease identification, classification and initial direct costs. As part of our adoption, however, we did not elect to use the hindsight or land easements practical expedients. On August 1, 2019, in connection with our adoption of Topic 842, we recognized $35,825,000 of operating lease right-of-use ("ROU") assets (net of a $3,023,000 deferred rent liability that existed as of August 1, 2019 under prior applicable GAAP) and $38,848,000 of related liabilities. Except for the recording of the ROU assets and lease liabilities on our Condensed Consolidated Balance Sheet, and the expanded disclosures about our leasing activities, our adoption did not have a material impact on our condensed consolidated financial statements. Our adoption also did not result in any cumulative-effect adjustment to opening retained earnings. Our leases historically relate to the leasing of facilities and equipment. We determine at inception whether an arrangement is, or contains, a lease and whether the lease should be classified as an operating or a financing lease. At lease commencement, we recognize an ROU asset and lease liability based on the present value of the future lease payments over the estimated lease term. We have elected to not recognize an ROU asset or lease liability for any leases with terms of twelve months or less. Instead, for such short-term leases, we recognize lease expense on a straight-line basis over the lease term. Certain of our leases include options to extend the term of the lease or to terminate the lease early. When it is reasonably certain that we will exercise a renewal option or will not exercise a termination option, we include the impact of exercising or not exercising such option, respectively, in the estimate of the lease term. As our lease agreements do not explicitly state the discount rate implicit in the lease, we use our incremental borrowing rate ("IBR") on the commencement date to calculate the present value of future lease payments. Such IBR represents our estimated rate of interest to borrow on a collateralized basis over a term commensurate with the expected lease term. Some of our leases include payments that are based on the Consumer Price Index ("CPI") or other similar indices. These variable lease payments are included in the calculation of the ROU asset and lease liability using the index as of the lease commencement date. Other variable lease payments, such as common area maintenance, property taxes, and usage-based amounts, are required by Topic 842 to be excluded from the ROU asset and lease liability and expensed as incurred. In addition to the present value of the future lease payments, the calculation of the ROU asset would also consider, to the extent applicable, any deferred rent upon adoption, lease pre-payments or initial direct costs of obtaining the lease (e.g., such as commissions). For all classes of leased assets, we elected the practical expedient to not separate lease components (i.e., the actual item being leased, such as the facility or piece of equipment) from non-lease components (i.e., the distinct elements of a contract not related to securing the use of the leased asset, such as common area maintenance and consumable supplies). Certain of our facility lease agreements (which are classified as operating leases) contain rent holidays or rent escalation clauses. For rent holidays and rent escalation clauses during the lease term, we record rental expense on a straight-line basis over the term of the lease. As of April 30, 2020 , none of our leases contained a residual value guarantee and covenants included in our lease agreements are customary for the types of facilities and equipment being leased. The components of lease expense are as follows: Three months ended April 30, 2020 Nine months ended April 30, 2020 Finance lease expense: Amortization of ROU assets $ — $ 152,000 Interest on lease liabilities — 3,000 Operating lease expense 2,733,000 8,069,000 Short-term lease expense 798,000 2,539,000 Variable lease expense 1,004,000 3,013,000 Sublease income (5,000 ) (5,000 ) Total lease expense $ 4,530,000 $ 13,771,000 Additional information related to leases is as follows: Nine months ended April 30, 2020 Cash paid for amounts included in the measurement of lease liabilities: Operating leases - Operating cash outflows $ 8,681,000 Finance leases - Operating cash outflows 3,000 Finance leases - Financing cash outflows 300,000 ROU assets obtained in the exchange for lease liabilities (non-cash): Operating leases $ 3,096,000 The following table is a reconciliation of future cash flows relating to operating lease liabilities presented on our Condensed Consolidated Balance Sheet as of April 30, 2020 : Operating Remaining portion of fiscal 2020 $ 2,666,000 Fiscal 2021 9,116,000 Fiscal 2022 7,730,000 Fiscal 2023 6,231,000 Fiscal 2024 4,878,000 Thereafter 7,013,000 Total future undiscounted cash flows 37,634,000 Less: Present value discount 3,289,000 Lease liabilities $ 34,345,000 Weighted-average remaining lease terms (in years) 4.71 Weighted-average discount rate 4.04 % We lease our Melville, New York production facility from a partnership controlled by our CEO and Chairman. Lease payments made during the nine months ended April 30, 2020 were $486,000 . The current lease provides for our use of the premises as they exist through December 2021 with an option for an additional ten years. The annual rent of the facility for calendar year 2020 is $657,000 and is subject to customary adjustments. We have a right of first refusal in the event of a sale of the facility. As of April 30, 2020 , we do not have any rental commitments that have not commenced. As we have not restated prior year information given our method of adopting the new standard, the following represents our future minimum lease payments for operating leases and capital leases as of July 31, 2019 under ASC Topic 840 and as reported in our Form 10-K filed with the SEC on September 24, 2019: Operating Capital Total Fiscal 2020 $ 11,812,000 789,000 $ 12,601,000 Fiscal 2021 8,723,000 — 8,723,000 Fiscal 2022 7,343,000 — 7,343,000 Fiscal 2023 5,776,000 — 5,776,000 Fiscal 2024 3,430,000 — 3,430,000 Thereafter 7,130,000 — 7,130,000 Total $ 44,214,000 789,000 $ 45,003,000 Less amount representing interest * 32,000 32,000 Present value of net minimum lease payments * $ 757,000 $ 44,971,000 *Not applicable for operating leases |
Income Taxes
Income Taxes | 9 Months Ended |
Apr. 30, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes At April 30, 2020 and July 31, 2019 , total unrecognized tax benefits were $8,309,000 and $7,215,000 , respectively, including interest of $73,000 and $12,000 , respectively. At April 30, 2020 and July 31, 2019 , $2,316,000 and $325,000 , respectively, of our unrecognized tax benefits were recorded as non-current income taxes payable on our Condensed Consolidated Balance Sheets. The remaining unrecognized tax benefits of $5,993,000 and $6,890,000 at April 30, 2020 and July 31, 2019 , respectively, were presented as an offset to the associated non-current deferred tax assets on our Condensed Consolidated Balance Sheets. Of the total unrecognized tax benefits, $7,663,000 and $6,670,000 , at April 30, 2020 and July 31, 2019 , respectively, net of the reversal of the federal benefit recognized as a deferred tax asset relating to state reserves, would favorably impact our effective tax rate, if recognized. Unrecognized tax benefits result from income tax positions taken or expected to be taken on our income tax returns for which a tax benefit has not been recorded in our condensed consolidated financial statements. We do not expect that there will be any significant changes to our total unrecognized tax benefits within the next twelve months. Our federal income tax returns for fiscal 2017 through 2019 are subject to potential future Internal Revenue Service ("IRS") audit. None of our state income tax returns prior to fiscal 2015 are subject to audit. None of TCS's state income tax returns prior to calendar year 2015 are subject to audit. Future tax assessments or settlements could have a material adverse effect on our consolidated results of operations and financial condition. |
Stock-Based Compensation
Stock-Based Compensation | 9 Months Ended |
Apr. 30, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation Overview We issue stock-based awards to certain of our employees and our Board of Directors pursuant to our 2000 Stock Incentive Plan, as amended, (the "Plan") and our 2001 Employee Stock Purchase Plan (the "ESPP"), and recognize related stock-based compensation in our condensed consolidated financial statements. The Plan provides for the granting to employees and consultants of Comtech (including prospective employees and consultants): (i) incentive and non-qualified stock options, (ii) restricted stock units ("RSUs"), (iii) RSUs with performance measures (which we refer to as "performance shares"), (iv) restricted stock, (v) stock units (reserved for issuance to non-employee directors) and share units (reserved for issuance to employees) (collectively, "share units") and (vi) stock appreciation rights ("SARs"), among other types of awards. Our non-employee directors are eligible to receive non-discretionary grants of stock-based awards, subject to certain limitations. As of April 30, 2020 , the aggregate number of shares of common stock which may be issued, pursuant to the Plan, may not exceed 10,962,500 . Stock options granted may not have a term exceeding ten years or, in the case of an incentive stock award granted to a stockholder who owns stock representing more than 10.0% of the voting power, no more than five years . We expect to settle all outstanding awards under the Plan and employee purchases under the ESPP with the issuance of new shares of our common stock. As of April 30, 2020 , we had granted stock-based awards pursuant to the Plan representing the right to purchase and/or acquire an aggregate of 8,568,523 shares (net of 4,191,578 expired and canceled awards), of which an aggregate of 6,525,623 have been exercised or settled. As of April 30, 2020 , the following stock-based awards, by award type, were outstanding: April 30, 2020 Stock options 1,139,675 Performance shares 215,234 RSUs and restricted stock 448,311 Share units 239,680 Total 2,042,900 Our ESPP provides for the issuance of up to 1,050,000 shares of our common stock. Our ESPP is intended to provide our eligible employees the opportunity to acquire our common stock at 85% of fair market value at the date of issuance. Through April 30, 2020 , we have cumulatively issued 823,219 shares of our common stock to participating employees in connection with our ESPP. Stock-based compensation for awards issued is reflected in the following line items in our Condensed Consolidated Statements of Operations: Three months ended April 30, Nine months ended April 30, 2020 2019 2020 2019 Cost of sales $ 45,000 52,000 $ 164,000 170,000 Selling, general and administrative expenses 878,000 1,004,000 2,715,000 2,960,000 Research and development expenses 58,000 63,000 219,000 226,000 Stock-based compensation expense before income tax benefit 981,000 1,119,000 3,098,000 3,356,000 Estimated income tax benefit (204,000 ) (244,000 ) (664,000 ) (732,000 ) Net stock-based compensation expense $ 777,000 875,000 $ 2,434,000 2,624,000 Stock-based compensation for equity-classified awards is measured at the date of grant, based on an estimate of the fair value of the award and is generally expensed over the vesting period of the award. At April 30, 2020 , unrecognized stock-based compensation of $ 9,153,000 , net of estimated forfeitures of $ 1,065,000 , is expected to be recognized over a weighted average period of 3.0 years. Total stock-based compensation capitalized and included in ending inventory at both April 30, 2020 and July 31, 2019 was $48,000 . There are no liability-classified stock-based awards outstanding as of April 30, 2020 or July 31, 2019 . Stock-based compensation expense (benefit), by award type, is summarized as follows: Three months ended April 30, Nine months ended April 30, 2020 2019 2020 2019 Stock options $ 39,000 174,000 $ 203,000 526,000 Performance shares 412,000 374,000 1,185,000 1,166,000 RSUs and restricted stock 477,000 515,000 1,850,000 1,630,000 ESPP 53,000 56,000 170,000 164,000 Share units — — (310,000 ) (130,000 ) Stock-based compensation expense before income tax benefit 981,000 1,119,000 3,098,000 3,356,000 Estimated income tax benefit (204,000 ) (244,000 ) (664,000 ) (732,000 ) Net stock-based compensation expense $ 777,000 875,000 $ 2,434,000 2,624,000 ESPP stock-based compensation expense primarily relates to the 15% discount offered to participants in the ESPP. During the nine months ended April 30, 2020 and 2019 , we recorded benefits of $310,000 and $130,000 , respectively, which primarily represents the recoupment of certain share units. The estimated income tax benefit as shown in the above table was computed using income tax rates expected to apply when the awards are settled. Such deferred tax asset was recorded net as part of our non-current deferred tax liability on our Condensed Consolidated Balance Sheet as of April 30, 2020 and July 31, 2019 . The actual income tax benefit recognized for tax reporting is based on the fair market value of our common stock at the time of settlement and can significantly differ from the estimated income tax benefit recorded for financial reporting. Stock Options The following table summarizes the Plan's activity during the nine months ended April 30, 2020 : Awards (in Shares) Weighted Average Exercise Price Weighted Average Remaining Contractual Term (Years) Aggregate Intrinsic Value Outstanding at July 31, 2019 1,555,555 $ 28.72 Exercised (51,460 ) 28.45 Expired/canceled (800 ) 27.35 Outstanding at October 31, 2019 1,503,295 28.73 Expired/canceled (100 ) 28.35 Exercised (233,330 ) 28.90 Outstanding at January 31, 2020 1,269,865 28.70 Exercised (1,000 ) 28.84 Expired/canceled (129,190 ) 29.18 Outstanding at April 30, 2020 1,139,675 $ 28.65 3.08 $ — Exercisable at April 30, 2020 1,079,985 $ 28.74 2.96 $ — Vested and expected to vest at April 30, 2020 1,116,541 $ 28.68 3.04 $ — Stock options outstanding as of April 30, 2020 have exercise prices ranging from $ 20.90 - $ 33.94 , representing the fair market value of our common stock on the date of grant, a contractual term of five or ten years and a vesting period of three or five years. The total intrinsic value relating to stock options exercised during the three and nine months ended April 30, 2020 was $5,000 and $1,869,000 , respectively. There were no stock options exercised during the three months ended April 30, 2019 . The total intrinsic value relating to stock options exercised during the nine months ended April 30, 2019 was $561,000 . During the nine months ended April 30, 2020 and 2019 , at the election of certain holders of vested stock options, 269,090 and 72,830 , respectively, of stock options were net settled upon exercise. As a result, 27,992 and 9,345 shares of our common stock were issued during the nine months ended April 30, 2020 and 2019 , respectively, net of shares retained to satisfy the exercise price and minimum statutory tax withholding requirements. Performance Shares, RSUs, Restricted Stock and Share Unit Awards The following table summarizes the Plan's activity relating to performance shares, RSUs, restricted stock and share units: Awards (in Shares) Weighted Average Grant Date Fair Value Aggregate Intrinsic Value Outstanding at July 31, 2019 954,676 $ 22.40 Granted 219,425 27.69 Settled (199,466 ) 16.80 Forfeited (41,080 ) 21.00 Outstanding at October 31, 2019 933,555 24.91 Settled (527 ) 11.40 Forfeited (1,836 ) 23.95 Outstanding at January 31, 2020 931,192 24.92 Granted 5,064 21.64 Settled (3,884 ) 23.26 Forfeited (29,147 ) 23.40 Outstanding at April 30, 2020 903,225 $ 24.96 $ 16,719,000 Vested at April 30, 2020 326,186 $ 24.93 $ 6,038,000 Vested and expected to vest at April 30, 2020 860,595 $ 25.12 $ 15,930,000 The total intrinsic value relating to fully-vested awards settled during the three and nine months ended April 30, 2020 was $70,000 and $5,895,000 , respectively. The total intrinsic value relating to fully-vested awards settled during the three and nine months ended April 30, 2019 was $28,000 and $4,252,000 , respectively. The performance shares granted to employees since fiscal 2014 principally vest over a three -year performance period, if pre-established performance goals are attained or as specified pursuant to the Plan and related agreements. As of April 30, 2020 , the number of outstanding performance shares included in the above table, and the related compensation expense prior to consideration of estimated pre-vesting forfeitures, assume achievement of the pre-established goals at a target level. RSUs and restricted stock granted to non-employee directors prior to July 31, 2019 have a vesting period of three years and are convertible into shares of our common stock generally at the time of termination, on a one -for-one basis for no cash consideration, or earlier under certain circumstances. RSUs and restricted stock granted to non-employee directors after July 31, 2019 have a vesting period of five years. RSUs granted to employees have a vesting period of five years and are convertible into shares of our common stock, generally at the time of vesting, on a one -for-one basis for no cash consideration. Share units granted prior to July 31, 2017 were vested when issued and are convertible into shares of our common stock, generally at the time of termination, on a one -for-one basis for no cash consideration, or earlier under certain circumstances. Share units granted on or after July 31, 2017 were granted to certain employees in lieu of non-equity incentive compensation and are convertible into shares of our common stock on the one -year anniversary of the respective grant date. Cumulatively through April 30, 2020 , 431,142 share units granted have been settled. The fair value of performance shares, RSUs, restricted stock and share units is determined using the closing market price of our common stock on the date of grant, less the present value of any estimated future dividend equivalents such awards are not entitled to receive and an applicable estimated discount for any post vesting transfer restrictions. RSUs, performance shares and restricted stock granted since fiscal 2013 are entitled to dividend equivalents unless forfeited before vesting occurs. Share units granted since fiscal 2014 are entitled to dividend equivalents while the underlying shares are unissued. Dividend equivalents are subject to forfeiture, similar to the terms of the underlying stock-based awards, and are payable in cash generally at the time of settlement of the underlying award. During the three and nine months ended April 30, 2020 , we accrued $56,000 and $169,000 , respectively, of dividend equivalents (net of forfeitures) and paid out $1,000 and $287,000 , respectively. Accrued dividend equivalents were recorded as a reduction to retained earnings. As of April 30, 2020 and July 31, 2019 , accrued dividend equivalents were $659,000 and $777,000 , respectively. With respect to the actual settlement of stock-based awards for income tax reporting, during the three and nine months ended April 30, 2020 , we recorded a $122,000 income tax expense and a $349,000 income tax benefit, respectively, and during the three and nine months ended April 30, 2019 , we recorded an income tax benefit of $52,000 and $505,000 , respectively. Such income tax expense generally relates to the reversal of deferred tax assets associated with expired and unexercised stock-based awards and any net income tax shortfalls upon settlement. Such income tax benefit generally relates to any net excess income tax benefits upon settlement. In May 2020, we granted non-qualified stock options under the Plan for an aggregate 342,300 shares of our common stock. The total estimated fair value of such options, net of estimated forfeitures, is $2,800,000 . The options vest over a five -year period and expire ten years after the date of grant. |
Segment Information
Segment Information | 9 Months Ended |
Apr. 30, 2020 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information Reportable operating segments are determined based on Comtech’s management approach. The management approach, as defined by FASB ASC 280 "Segment Reporting" is based on the way that the CODM organizes the segments within an enterprise for making decisions about resources to be allocated and assessing their performance. Our CODM, for purposes of FASB ASC 280, is our Chief Executive Officer. Our Commercial Solutions segment offers satellite ground station technologies (such as modems and amplifiers) and public safety and location technologies (such as 911 call routing and mapping solutions) to commercial customers and smaller government customers, such as state and local governments. This segment also serves certain large government customers (including the U.S. government) that have requirements for off-the-shelf commercial equipment. Our Government Solutions segment provides mission-critical technologies (such as tactical satellite-based networks and ongoing support for complicated communications networks) and high-performance transmission technologies (such as troposcatter systems and solid-state, high-power amplifiers) to large government end-users (including those of foreign countries), large international customers and domestic prime contractors. Our CODM primarily uses a metric that we refer to as Adjusted EBITDA to measure an operating segment’s performance and to make decisions about resources to be allocated. Our Adjusted EBITDA metric for the Commercial Solutions and Government Solutions segments do not consider any allocation of indirect expense, or any of the following: income taxes, interest (income) and other, write-off of deferred financing costs, interest expense, amortization of stock-based compensation, amortization of intangible assets, depreciation expenses, estimated contract settlement costs, settlement of intellectual property litigation, acquisition plan expenses, facility exit costs or strategic alternatives analysis expenses and other expenses that relate to our Unallocated segment. These items, while periodically affecting our results, may vary significantly from period to period and may have a disproportionate effect in a given period, thereby affecting the comparability of results. Any amounts shown in the Adjusted EBITDA calculation for our Commercial Solutions and Government Solutions segments are directly attributable to those segments. Our Adjusted EBITDA is also used by our management in assessing the Company's operating results. Although closely aligned, the Company's definition of Adjusted EBITDA is different than the Consolidated EBITDA (as such term is defined in our Credit Facility) utilized for financial covenant calculations and also may differ from the definition of EBITDA or Adjusted EBITDA used by other companies and, therefore, may not be comparable to similarly titled measures used by other companies. Operating segment information, along with a reconciliation of segment net income (loss) and consolidated net income to Adjusted EBITDA is presented in the tables below: Three months ended April 30, 2020 Commercial Solutions Government Solutions Unallocated Total Net sales $ 78,311,000 56,810,000 — $ 135,121,000 Operating income (loss) $ 4,041,000 4,194,000 (11,371,000 ) $ (3,136,000 ) Net income (loss) $ 3,462,000 4,253,000 (11,704,000 ) $ (3,989,000 ) Provision for (benefit from) income taxes 481,000 (65,000 ) (1,175,000 ) (759,000 ) Interest (income) and other 89,000 — 19,000 108,000 Interest expense 9,000 6,000 1,489,000 1,504,000 Amortization of stock-based compensation — — 981,000 981,000 Amortization of intangibles 4,313,000 1,204,000 — 5,517,000 Depreciation 1,993,000 447,000 210,000 2,650,000 Estimated contract settlement costs 476,000 — — 476,000 Acquisition plan expenses 701,000 — 5,282,000 5,983,000 Adjusted EBITDA $ 11,524,000 5,845,000 (4,898,000 ) $ 12,471,000 Purchases of property, plant and equipment $ 1,263,000 531,000 118,000 $ 1,912,000 Long-lived assets acquired in connection with the acquisitions $ 4,023,000 4,402,000 — $ 8,425,000 Total assets at April 30, 2020 $ 663,455,000 235,739,000 52,538,000 $ 951,732,000 Three months ended April 30, 2019 Commercial Solutions Government Solutions Unallocated Total Net sales $ 89,600,000 80,848,000 — $ 170,448,000 Operating income (loss) $ 8,126,000 10,053,000 (6,883,000 ) $ 11,296,000 Net income (loss) $ 8,086,000 10,073,000 (10,547,000 ) $ 7,612,000 Provision for income taxes 10,000 — 1,537,000 1,547,000 Interest (income) and other 9,000 (21,000 ) (10,000 ) (22,000 ) Interest expense 21,000 1,000 2,137,000 2,159,000 Amortization of stock-based compensation — — 1,119,000 1,119,000 Amortization of intangibles 3,692,000 844,000 — 4,536,000 Depreciation 2,374,000 367,000 177,000 2,918,000 Estimated contract settlement costs 2,465,000 — — 2,465,000 Acquisition plan expenses — — 1,704,000 1,704,000 Adjusted EBITDA $ 16,657,000 11,264,000 (3,883,000 ) $ 24,038,000 Purchases of property, plant and equipment $ 1,730,000 296,000 181,000 $ 2,207,000 Long-lived assets acquired in connection with the acquisitions $ 60,451,000 — — $ 60,451,000 Total assets at April 30, 2019 $ 665,499,000 200,442,000 37,546,000 $ 903,487,000 Nine months ended April 30, 2020 Commercial Solutions Government Solutions Unallocated Total Net sales $ 268,747,000 198,295,000 — $ 467,042,000 Operating income (loss) $ 26,501,000 16,280,000 (30,423,000 ) $ 12,358,000 Net income (loss) $ 26,031,000 16,364,000 (36,501,000 ) $ 5,894,000 Provision for (benefit from) income taxes 382,000 (65,000 ) 1,186,000 1,503,000 Interest (income) and other 62,000 (26,000 ) 1,000 37,000 Interest expense 26,000 7,000 4,891,000 4,924,000 Amortization of stock-based compensation — — 3,098,000 3,098,000 Amortization of intangibles 13,037,000 2,915,000 — 15,952,000 Depreciation 6,372,000 1,072,000 578,000 8,022,000 Estimated contract settlement costs 444,000 — — 444,000 Acquisition plan expenses 701,000 — 13,696,000 14,397,000 Adjusted EBITDA $ 47,055,000 20,267,000 (13,051,000 ) $ 54,271,000 Purchases of property, plant and equipment $ 3,178,000 956,000 286,000 $ 4,420,000 Long-lived assets acquired in connection with the acquisitions $ 6,060,000 34,609,000 — $ 40,669,000 Total assets at April 30, 2020 $ 663,455,000 235,739,000 52,538,000 $ 951,732,000 Nine months ended April 30, 2019 Commercial Solutions Government Solutions Unallocated Total Net sales $ 254,308,000 241,117,000 — $ 495,425,000 Operating income (loss) $ 23,942,000 24,480,000 (17,420,000 ) $ 31,002,000 Net income (loss) $ 23,783,000 24,505,000 (29,382,000 ) $ 18,906,000 Provision for income taxes 65,000 — 1,726,000 1,791,000 Interest (income) and other 32,000 (33,000 ) (6,000 ) (7,000 ) Write-off of deferred financing costs — — 3,217,000 3,217,000 Interest expense 62,000 8,000 7,025,000 7,095,000 Amortization of stock-based compensation — — 3,356,000 3,356,000 Amortization of intangibles 10,581,000 2,532,000 — 13,113,000 Depreciation 6,898,000 1,113,000 607,000 8,618,000 Estimated contract settlement costs 6,351,000 — — 6,351,000 Settlement of intellectual property litigation — — (3,204,000 ) (3,204,000 ) Acquisition plan expenses — — 4,612,000 4,612,000 Facility exit costs — 1,373,000 — 1,373,000 Adjusted EBITDA $ 47,772,000 29,498,000 (12,049,000 ) $ 65,221,000 Purchases of property, plant and equipment $ 4,593,000 1,357,000 438,000 $ 6,388,000 Long-lived assets acquired in connection with the acquisitions $ 60,451,000 — — $ 60,451,000 Total assets at April 30, 2019 $ 665,499,000 200,442,000 37,546,000 $ 903,487,000 Unallocated expenses result from corporate expenses such as executive compensation, accounting, legal and other regulatory compliance related costs and also includes all of our amortization of stock-based compensation. During the three months ended April 30, 2020 and 2019 , we recorded $5,983,000 and $1,704,000 of acquisition plan expenses, respectively. During the nine months ended April 30, 2020 and 2019 , we recorded $14,397,000 and $4,612,000 of acquisition plan expenses, respectively. These expenses were recorded primarily in our unallocated expenses. See Note (2) - "Acquisitions" for further information. In addition, offsetting unallocated expenses for the nine months ended April 30, 2019 is a $3,204,000 benefit as a result of a favorable ruling issued by the U.S. Court of Appeals for the Federal Circuit related to a legacy TCS intellectual property matter. Interest expense in the tables above relate to our Prior Credit Facility and Credit Facility, and includes the amortization of deferred financing costs. In addition, during the nine months ended April 30, 2019, we recorded a $3,217,000 loss from the write-off of deferred financing costs primarily related to the Term Loan Facility portion of our Prior Credit Facility. See Note (11) - "Credit Facility" for further discussion. Intersegment sales for the three months ended April 30, 2020 and 2019 by the Commercial Solutions segment to the Government Solutions segment were $3,115,000 and $1,413,000 , respectively. Intersegment sales for the nine months ended April 30, 2020 and 2019 by the Commercial Solutions segment to the Government Solutions segment were $6,876,000 and $14,515,000 , respectively. There were nominal sales by the Government Solutions segment to the Commercial Solutions segment for these periods. All intersegment sales are eliminated in consolidation and are excluded from the tables above. Unallocated assets at April 30, 2020 consist principally of cash and cash equivalents, income taxes receivable, corporate property, plant and equipment and deferred financing costs. Substantially all of our long-lived assets are located in the U.S. |
Goodwill
Goodwill | 9 Months Ended |
Apr. 30, 2020 | |
Goodwill [Abstract] | |
Goodwill | Goodwill The following table represents goodwill by reportable operating segment, including the changes in the net carrying value of goodwill during the nine months ended April 30, 2020 : Commercial Solutions Government Solutions Total Balance as of July 31, 2019 $ 251,296,000 59,193,000 $ 310,489,000 Change related to Solacom acquisition (420,000 ) — (420,000 ) Change related to GD NG-911 acquisition 4,556,000 — 4,556,000 Change related to CGC acquisition — 20,852,000 20,852,000 Balance as of April 30, 2020 $ 255,432,000 80,045,000 $ 335,477,000 As discussed further in Note (2) -"Acquisitions," the goodwill resulting from the acquisition of CGC was based upon a valuation and estimates and assumptions that are subject to change within the purchase price allocation period (generally one year from the acquisition date). In accordance with FASB ASC 350 "Intangibles - Goodwill and Other," we perform a goodwill impairment analysis at least annually (in the first quarter of each fiscal year), unless indicators of impairment exist in interim periods. If we fail the quantitative assessment of goodwill impairment ("quantitative assessment"), we would be required to recognize an impairment loss equal to the amount that a reporting unit's carrying value exceeded its fair value; however, any loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. On August 1, 2019 (the first day of our fiscal 2020 ), we performed our annual quantitative assessment using market participant assumptions to determine if the fair value of each of our reporting units with goodwill exceeded its carrying value. In making this assessment, we considered, among other things, expectations of projected net sales and cash flows, assumptions impacting the weighted average cost of capital, trends in trading multiples of comparable companies, changes in our stock price and changes in the carrying values of our reporting units with goodwill. We also considered overall business conditions. In performing the quantitative assessment, we estimated the fair value of each of our reporting units using a combination of the income and market approaches. The income approach, also known as the discounted cash flow ("DCF") method, utilizes the present value of cash flows to estimate fair value. The future cash flows for our reporting units were projected based on our estimates, at that time, of future revenues, operating income and other factors (such as working capital and capital expenditures). For purposes of conducting our impairment analysis, we assumed revenue growth rates and cash flow projections that are below our actual long-term expectations. The discount rates used in our DCF method were based on a weighted-average cost of capital ("WACC") determined from relevant market comparisons, adjusted upward for specific reporting unit risks (primarily the uncertainty of achieving projected operating cash flows). A terminal value growth rate was applied to the final year of the projected period, which reflects our estimate of stable, perpetual growth. We then calculated a present value of the respective cash flows for each reporting unit to arrive at an estimate of fair value under the income approach. Under the market approach, we estimated a fair value based on comparable companies' market multiples of revenues and earnings before interest, taxes, depreciation and amortization and factored in a control premium. Finally, we compared our estimates of fair values to our August 1, 2019 total public market capitalization and assessed implied control premiums based on our common stock price of $29.54 as of August 1, 2019 . Based on our quantitative evaluation, we determined that our Commercial Solutions and Government Solutions reporting units had estimated fair values in excess of their carrying values of at least 29.0% and 122.2% , respectively, and concluded that our goodwill was not impaired and that neither of our two reporting units was at risk of failing the quantitative assessment. As of April 30, 2020 , we considered both the potential short-term and long-term effects of the COVID-19 pandemic on our two reporting units with goodwill and whether such effects made it more-likely-than-not (i.e., a greater than 50.0% probability) that the fair values of our reporting units with goodwill would fall below their carrying values. Based upon our analysis, we have determined that none of our goodwill has been impaired as of April 30, 2020 . However, it is possible that, during the remainder of fiscal 2020 or beyond, business conditions (both in the U.S. and internationally) could deteriorate from the current state, our current or prospective customers could materially postpone, reduce or even forgo purchases of our products and services to a greater extent than we currently anticipate, or our common stock price could decline further. Such deterioration could be caused by uncertainty about the severity and length of the COVID-19 pandemic, and its impact on global business activity. A significant decline in our customers' spending that is greater than we anticipate or a shift in funding priorities may also have a negative effect on future orders, sales, income and cash flows and we might be required to perform a quantitative assessment during the remainder of fiscal 2020 or beyond. If assumed net sales and cash flow projections are not achieved in future periods or our common stock price significantly declines from current levels, our Commercial Solutions and Government Solutions reporting units could be at risk of failing the quantitative assessment and goodwill assigned to the respective reporting units could be impaired. In any event, we are required to perform the next annual goodwill impairment analysis on August 1, 2020 (the start of our fiscal 2021 ). If our assumptions and related estimates change in the future, or if we change our reporting unit structure or other events and circumstances change (e.g., a sustained decrease in the price of our common stock (considered on both absolute terms and relative to peers)), we may be required to record impairment charges when we perform these tests, or in other future periods. Any impairment charges that we may record in the future could be material to our results of operations and financial condition. |
Intangible Assets
Intangible Assets | 9 Months Ended |
Apr. 30, 2020 | |
Finite-Lived Intangible Assets, Net [Abstract] | |
Intangible Assets | Intangible Assets Intangible assets with finite lives are as follows: As of April 30, 2020 Weighted Average Amortization Period Gross Carrying Amount Accumulated Amortization Net Carrying Amount Customer relationships 20.4 $ 284,558,000 76,205,000 $ 208,353,000 Technologies 13.7 97,649,000 63,866,000 33,783,000 Trademarks and other 16.6 32,526,000 14,500,000 18,026,000 Total $ 414,733,000 154,571,000 $ 260,162,000 As of July 31, 2019 Weighted Average Amortization Period Gross Carrying Amount Accumulated Amortization Net Carrying Amount Customer relationships 20.5 $ 276,834,000 66,484,000 $ 210,350,000 Technologies 12.7 92,649,000 59,522,000 33,127,000 Trademarks and other 16.7 31,026,000 12,613,000 18,413,000 Total $ 400,509,000 138,619,000 $ 261,890,000 The weighted average amortization period in the above table excludes fully amortized intangible assets. Amortization expense for the three months ended April 30, 2020 and 2019 was $5,517,000 and $4,536,000 , respectively. Amortization expense for the nine months ended April 30, 2020 and 2019 was $15,952,000 and $13,113,000 , respectively. The estimated amortization expense consists of the following for the fiscal years ending July 31: 2020 $ 21,445,000 2021 21,040,000 2022 19,458,000 2023 19,458,000 2024 18,766,000 We review net intangible assets with finite lives for impairment when an event occurs indicating the potential for impairment. In light of the COVID-19 pandemic, during the three months ended April 30, 2020, we evaluated whether our long-lived assets, including intangibles with finite lives, were impaired. Based on our assessment, we believe that the carrying values of our net intangible assets were recoverable as of April 30, 2020 . However, if current poor business conditions further deteriorate, we may be required to record impairment losses in the future, which could increase the amortization of intangibles in our fourth quarter of fiscal 2020. Any impairment charges that we may record in the future could be material to our results of operations and financial condition. |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Apr. 30, 2020 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity | Stockholders’ Equity Sale of Common Stock In December 2018, we filed a $400,000,000 shelf registration statement with the SEC for the sale of various types of securities, including debt. The shelf registration was declared effective by the SEC as of December 14, 2018. To date, we have not issued any securities pursuant to our $400,000,000 shelf registration statement. Stock Repurchase Program As of April 30, 2020 and June 3, 2020 , we were authorized to repurchase up to an additional $8,664,000 of our common stock, pursuant to our current $100,000,000 stock repurchase program. Our stock repurchase program has no time restrictions and repurchases may be made in open-market or privately negotiated transactions and may be made pursuant to SEC Rule 10b5-1 trading plans. There were no repurchases made during the three or nine months ended April 30, 2020 or 2019 . Dividends Since September 2010, we have paid quarterly dividends pursuant to an annual targeted dividend amount that was established by our Board of Directors. On September 24, 2019 , December 4, 2019 and March 4, 2020 , our Board of Directors declared a dividend of $0.10 per common share, which were paid on November 15, 2019 , February 14, 2020 , and May 15, 2020 , respectively. On June 3, 2020 , our Board of Directors declared a dividend of $0.10 per common share, payable on August 14, 2020 to stockholders of record at the close of business on July 15, 2020 . Future dividends remain subject to compliance with financial covenants under our Credit Facility as well as Board approval. |
Legal Proceedings and Other Mat
Legal Proceedings and Other Matters | 9 Months Ended |
Apr. 30, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Legal Proceedings and Other Matters | Legal Proceedings and Other Matters Legacy TCS 911 Call Handling Software Matter In fiscal 2019, a customer that purchased a TCS 911 call handling software solution in December 2014 (which was more than one year prior to our acquisition of TCS) (the "TCS Legacy Customer") which claimed that it experienced several network outages and that it would seek indemnification for any claims made against it as a result of such outages. In September 2019, the customer filed a lawsuit in the Sixth Judicial Circuit Court of the State of South Dakota. TCS's contract to provide services to this customer expired in December 2019 and the amount of annual revenue generated from this customer was immaterial. We believe that TCS fully complied with its contractual requirements, that the customer's allegations were baseless, and that it was not entitled to a return of any amounts previously paid to TCS under the contract. During the third quarter of fiscal 2020, an agreement was reached with this TCS Legacy Customer and the lawsuit was dismissed. Such agreement did not have a material impact on our condensed consolidated financial statements. Separately, we also filed a lawsuit in March 2019 against a former employee and her new employer arising from such former employee's violation of her obligation to TCS of confidentiality, non-competition and non-solicitation of customers, including the TCS Legacy Customer. The former employee has responded with her own lawsuit against us. The ultimate resolution of this lawsuit is not expected to have any material negative impact on our condensed consolidated results of operations or financial position. Other Matters In October 2014, we disclosed to the U.S. Department of the Treasury, Office of Foreign Assets Control ("OFAC") that we learned during a self-assessment of our export transactions that a shipment of modems sent to a Canadian customer by Comtech EF Data Corp. was incorporated into a communication system, the ultimate end user of which was the Sudan Civil Aviation Authority. The sales value of this equipment was approximately $288,000 . At the time of shipment, OFAC regulations prohibited U.S. persons from doing business directly or indirectly with Sudan. In late 2015, OFAC issued an administrative subpoena seeking information about the disclosed transaction. We responded to the subpoena, including alerting OFAC to Comtech’s repair of three modems for a customer in Lebanon who may have rerouted the modems from Lebanon to Sudan without the required U.S. licensing authorization. In September 2018, Comtech agreed to enter into a Tolling Agreement with OFAC, which extended the statute of limitations in this matter through December 31, 2019. The Tolling Agreement was shortly followed by a second administrative subpoena seeking additional information about the disclosed transaction. In December 2018, Comtech responded to a second administrative subpoena from OFAC, answering the questions it posed and providing all the documents it sought. In November 2019, Comtech agreed to enter into a second Tolling Agreement with OFAC, which extends the statute of limitations in this matter through June 30, 2020. U.S. sanctions with respect to Sudan were revoked in 2017 and we are in the process of responding to certain additional questions that OFAC asked of us based on its review. Consistent with the revocation of the Sudan Sanction Regulations ("SSR"), shipments to the Sudan Civil Aviation Authority by U.S. persons are now permissible. We are not able to predict whether OFAC will take any enforcement action against us in light of the revocation of the SSR. If OFAC determines that we have violated U.S. trade sanctions, civil and criminal penalties could apply, and we may suffer reputational harm. Even though we take precautions to avoid engaging in transactions that may violate U.S. trade sanctions, those measures may not be effective in every instance. In May 2018, we were informed by the Office of Export Enforcement ("OEE") of the Department of Commerce ("DoC") that it was forwarding to the OEE's Office of Chief Counsel, the results of its audit of international shipments by Comtech Xicom Technology, Inc. for further review and possible determination of an administrative penalty. We fully cooperated with the OEE in their audit and, based on our self-assessment of the approximately 7,800 individual transactions audited, have determined that six ( 6 ) transactions may not have been fully in compliance with the Export Administration Regulations ("EAR"). These six ( 6 ) items, for which export licenses were not obtained, were either spares or repaired power amplifier subassembly components valued at less than $100,000 (in aggregate) and were shipped to Brazil, Italy, Russia, Thailand and the United Arab Emirates. The EAR provides an exception to the requirement to obtain an export license for the replacement of a defective or damaged component. During our self-assessment, we determined that we inadvertently did not obtain export licenses for the spares or evidence of the return or destruction of the defective or damaged components necessary to authorize our use of the export license exception for the replacements. Since discovering this issue, we have implemented additional controls and procedures and have increased awareness of these specific export requirements throughout the Company to help avoid similar occurrences in the future. Administrative penalties under the EAR can range from a warning letter to a denial of export privileges. A civil monetary penalty not to exceed the amount set forth in the Export Administration Act ("EAA") may be imposed for each violation, and in the event that any provision of the EAR is continued by any other authority, the maximum monetary civil penalty for each violation shall be that provided by such other authority. Administrative penalties under the EAR are currently determined pursuant to the International Emergency Economic Powers Act ("IEEPA"), which can reach the greater of twice the amount of the transaction that is the basis of the violation or approximately $300,000 per violation. We have not recorded an accrual related to a possible administrative penalty and continue to work cooperatively with the OEE. In the ordinary course of business, we include indemnification provisions in certain of our customer contracts to indemnify, hold harmless and reimburse such customers for certain losses, including but not limited to losses related to third-party claims of intellectual property infringement arising from the customer’s use of our products or services. We may also, from time to time, receive indemnification requests from customers related to third-party claims that 911 calls were improperly routed during an emergency. We evaluate such claims as and when they arise. We do not always agree with customers that they are entitled to indemnification and in such cases reject their claims. Despite maintaining that we have properly carried out our duties, we may seek coverage under our various insurance policies; however, we cannot be sure that we will be able to maintain or obtain insurance coverage at acceptable costs or in sufficient amounts or that our insurer will not disclaim coverage as to such claims. Accordingly, pending or future claims asserted against us by a party that we agree to indemnify could result in legal costs and damages that could have a material adverse effect on our consolidated results of operations and financial condition. There are certain other pending and threatened legal actions which arise in the normal course of business. Although the ultimate outcome of litigation is difficult to accurately predict, we believe that the outcome of these other pending and threatened actions will not have a material adverse effect on our consolidated financial condition or results of operations. |
Adoption of Accounting Standa_2
Adoption of Accounting Standards and Updates Adoption of Accounting Standards and Updates (Policies) | 9 Months Ended |
Apr. 30, 2020 | |
Accounting Policies [Abstract] | |
Adoption of Accounting Standards and Updates | Adoption of Accounting Standards and Updates We are required to prepare our condensed consolidated financial statements in accordance with the Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") which is the source for all authoritative U.S. generally accepted accounting principles, which is commonly referred to as "GAAP." The FASB ASC is subject to updates by the FASB, which are known as Accounting Standards Updates ("ASUs"). During the nine months ended April 30, 2020 , we adopted: • FASB ASU No. 2016-02 Leases (Topic 842). See Note (12) - "Leases" for further information. • FASB ASU No. 2017-11, which provides guidance on the accounting for certain financial instruments with embedded features that result in the strike price of the instrument or embedded conversion option being reduced on the basis of the pricing of future equity offerings (commonly referred to as "down round" features). On August 1, 2019, we adopted this ASU. Our adoption did not have any impact on our condensed consolidated financial statements and disclosures, as we did not have any financial instruments with such "down round" features. • FASB ASU No. 2017-12, which expands and refines hedge accounting for both non-financial and financial risk components and simplifies and aligns the recognition and presentation of the effects of the hedging instrument and the hedged item in the financial statements. On August 1, 2019, we adopted this ASU. Our adoption did not have any impact on our condensed consolidated financial statements and disclosures, as we are not a party to any such hedging transactions. • FASB ASU No. 2018-07, which expands the scope of ASC 718 to include certain share-based payment transactions for acquiring goods and services from nonemployees. On August 1, 2019, we adopted this ASU. Our adoption did not have any impact on our condensed consolidated financial statements and disclosures, as we did not have any outstanding share-based awards with nonemployees that required remeasurement. • FASB ASU No. 2018-16, which expands the list of eligible U.S. benchmark interest rates permitted in the application of hedge accounting due to broad concerns about the long-term sustainability of the LIBO Rate. This ASU adds the Overnight Index Swap ("OIS") rate, based on the Secured Overnight Financing Rate ("SOFR"), as an eligible U.S. benchmark interest rate. On August 1, 2019, we adopted this ASU. Our adoption did not have any impact on our condensed consolidated financial statements and disclosures, as we are not a party to any such hedging transactions. |
Acquisitions (Tables)
Acquisitions (Tables) | 9 Months Ended |
Apr. 30, 2020 | |
CGC Technology | |
Business Acquisition [Line Items] | |
Fair Value of Assets Acquired and Liabilities Assumed | The following table summarizes the preliminary fair value of the assets acquired and liabilities assumed in connection with the CGC acquisition: Purchase Price Allocation (1) Measurement Period Adjustments Purchase Price Allocation (as adjusted) Payable in cash $ 12,075,000 — $ 12,075,000 Payable in common stock issued by Comtech 11,575,000 — 11,575,000 Preliminary purchase price at fair value $ 23,650,000 — $ 23,650,000 Preliminary allocation of aggregate purchase price: Cash and cash equivalents $ 160,000 — $ 160,000 Current assets 3,336,000 1,054,000 4,390,000 Property, plant and equipment 1,457,000 — 1,457,000 Operating lease assets 924,000 — 924,000 Deferred tax assets, non-current 588,000 487,000 1,075,000 Contract liabilities — (6,890,000 ) (6,890,000 ) Accrued warranty obligations (1,000,000 ) — (1,000,000 ) Other current liabilities (7,060,000 ) 862,000 (6,198,000 ) Non-current liabilities (1,329,000 ) — (1,329,000 ) Net tangible liabilities at preliminary fair value $ (2,924,000 ) (4,487,000 ) $ (7,411,000 ) Identifiable intangibles, deferred taxes and goodwill: Estimated Useful Lives Technology $ 5,000,000 — $ 5,000,000 20 years Customer relationships 7,000,000 (500,000 ) 6,500,000 15 years Trade name 800,000 — 800,000 5 years Deferred tax liabilities (2,176,000 ) 85,000 (2,091,000 ) Goodwill 15,950,000 4,902,000 20,852,000 Indefinite Preliminary allocation of aggregate purchase price $ 23,650,000 — $ 23,650,000 (1) As reported in the Company's Quarterly Report on Form 10-Q for the six months ended January 31, 2020. |
Revenue (Tables)
Revenue (Tables) | 9 Months Ended |
Apr. 30, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of concentration of risk | Sales by geography and customer type, as a percentage of consolidated net sales, are as follows: Three months ended April 30, Nine months ended April 30, 2020 2019 2020 2019 United States U.S. government 30.7 % 38.9 % 38.1 % 42.7 % Domestic 45.0 % 34.7 % 38.8 % 32.7 % Total United States 75.7 % 73.6 % 76.9 % 75.4 % International 24.3 % 26.4 % 23.1 % 24.6 % Total 100.0 % 100.0 % 100.0 % 100.0 % |
Schedule of disaggregation of revenue | Three months ended April 30, 2020 Nine months ended April 30, 2020 Commercial Solutions Government Solutions Total Commercial Solutions Government Solutions Total Geographical region and customer type U.S. government $ 7,230,000 34,268,000 $ 41,498,000 $ 41,167,000 136,941,000 $ 178,108,000 Domestic 51,499,000 9,314,000 60,813,000 158,856,000 22,588,000 181,444,000 Total United States 58,729,000 43,582,000 102,311,000 200,023,000 159,529,000 359,552,000 International 19,582,000 13,228,000 32,810,000 68,724,000 38,766,000 107,490,000 Total $ 78,311,000 56,810,000 $ 135,121,000 $ 268,747,000 198,295,000 $ 467,042,000 Contract type Firm fixed price $ 77,553,000 39,079,000 $ 116,632,000 $ 265,318,000 128,677,000 $ 393,995,000 Cost reimbursable 758,000 17,731,000 18,489,000 3,429,000 69,618,000 73,047,000 Total $ 78,311,000 56,810,000 $ 135,121,000 $ 268,747,000 198,295,000 $ 467,042,000 Transfer of control Point in time $ 25,730,000 32,193,000 $ 57,923,000 $ 106,464,000 98,653,000 $ 205,117,000 Over time 52,581,000 24,617,000 77,198,000 162,283,000 99,642,000 261,925,000 Total $ 78,311,000 56,810,000 $ 135,121,000 $ 268,747,000 198,295,000 $ 467,042,000 Three months ended April 30, 2019 Nine months ended April 30, 2019 Commercial Solutions Government Solutions Total Commercial Solutions Government Solutions Total Geographical region and customer type U.S. government $ 17,229,000 49,133,000 $ 66,362,000 $ 52,360,000 159,346,000 $ 211,706,000 Domestic 48,248,000 10,875,000 59,123,000 134,178,000 27,910,000 162,088,000 Total United States 65,477,000 60,008,000 125,485,000 186,538,000 187,256,000 373,794,000 International 24,123,000 20,840,000 44,963,000 67,770,000 53,861,000 121,631,000 Total $ 89,600,000 80,848,000 $ 170,448,000 $ 254,308,000 241,117,000 $ 495,425,000 Contract type Firm fixed price $ 88,125,000 57,451,000 $ 145,576,000 $ 249,982,000 178,080,000 $ 428,062,000 Cost reimbursable 1,475,000 23,397,000 24,872,000 4,326,000 63,037,000 67,363,000 Total $ 89,600,000 80,848,000 $ 170,448,000 $ 254,308,000 241,117,000 $ 495,425,000 Transfer of control Point in time $ 43,935,000 44,078,000 $ 88,013,000 $ 127,912,000 141,883,000 $ 269,795,000 Over time 45,665,000 36,770,000 82,435,000 126,396,000 99,234,000 225,630,000 Total $ 89,600,000 80,848,000 $ 170,448,000 $ 254,308,000 241,117,000 $ 495,425,000 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 9 Months Ended |
Apr. 30, 2020 | |
Earnings Per Share [Abstract] | |
Schedule of numerators and denominators used in basic and diluted EPS calculations | The following table reconciles the numerators and denominators used in the basic and diluted EPS calculations: Three months ended April 30, Nine months ended April 30, 2020 2019 2020 2019 Numerator: Net (loss) income for basic calculation $ (3,989,000 ) 7,612,000 $ 5,894,000 18,906,000 Numerator for diluted calculation $ (3,989,000 ) 7,612,000 $ 5,894,000 18,906,000 Denominator: Denominator for basic calculation 24,982,000 24,192,000 24,730,000 24,074,000 Effect of dilutive securities: Stock-based awards — 138,000 162,000 189,000 Denominator for diluted calculation 24,982,000 24,330,000 24,892,000 24,263,000 |
Accounts Receivable (Tables)
Accounts Receivable (Tables) | 9 Months Ended |
Apr. 30, 2020 | |
Accounts Receivable Additional Disclosures [Abstract] | |
Accounts receivable | Accounts receivable consist of the following at: April 30, 2020 July 31, 2019 Receivables from commercial and international customers $ 76,909,000 85,556,000 Unbilled receivables from commercial and international customers 17,919,000 20,469,000 Receivables from the U.S. government and its agencies 40,687,000 38,856,000 Unbilled receivables from the U.S. government and its agencies 4,202,000 2,018,000 Total accounts receivable 139,717,000 146,899,000 Less allowance for doubtful accounts 1,830,000 1,867,000 Accounts receivable, net $ 137,887,000 145,032,000 |
Inventories (Tables)
Inventories (Tables) | 9 Months Ended |
Apr. 30, 2020 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories consist of the following at: April 30, 2020 July 31, 2019 Raw materials and components $ 60,203,000 53,959,000 Work-in-process and finished goods 38,070,000 40,576,000 Total inventories 98,273,000 94,535,000 Less reserve for excess and obsolete inventories 18,850,000 19,696,000 Inventories, net $ 79,423,000 74,839,000 |
Accrued Expenses and Other Cu_2
Accrued Expenses and Other Current Liabilities (Tables) | 9 Months Ended |
Apr. 30, 2020 | |
Accrued Liabilities, Current [Abstract] | |
Accrued expenses and other current liabilities | Accrued expenses and other current liabilities consist of the following at: April 30, 2020 July 31, 2019 Accrued wages and benefits $ 23,473,000 23,295,000 Accrued contract costs 12,383,000 15,007,000 Accrued warranty obligations 15,504,000 15,968,000 Accrued legal costs 2,880,000 2,835,000 Accrued commissions and royalties 4,131,000 5,114,000 Other 25,190,000 16,365,000 Accrued expenses and other current liabilities $ 83,561,000 78,584,000 |
Schedule of changes in current accrued warranty obligations | Changes in our accrued warranty obligations during the nine months ended April 30, 2020 and 2019 were as follows: Nine months ended April 30, 2020 2019 Balance at beginning of period $ 15,968,000 11,738,000 Reclass to contract liabilities (see below) — (1,679,000 ) Provision for warranty obligations 1,628,000 1,320,000 Additions (in connection with acquisitions) 1,000,000 6,431,000 Charges incurred (3,394,000 ) (4,828,000 ) Warranty settlement and reclass (see below) 302,000 1,281,000 Balance at end of period $ 15,504,000 14,263,000 |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Apr. 30, 2020 | |
Leases [Abstract] | |
Components of lease expense and additional information | The components of lease expense are as follows: Three months ended April 30, 2020 Nine months ended April 30, 2020 Finance lease expense: Amortization of ROU assets $ — $ 152,000 Interest on lease liabilities — 3,000 Operating lease expense 2,733,000 8,069,000 Short-term lease expense 798,000 2,539,000 Variable lease expense 1,004,000 3,013,000 Sublease income (5,000 ) (5,000 ) Total lease expense $ 4,530,000 $ 13,771,000 Additional information related to leases is as follows: Nine months ended April 30, 2020 Cash paid for amounts included in the measurement of lease liabilities: Operating leases - Operating cash outflows $ 8,681,000 Finance leases - Operating cash outflows 3,000 Finance leases - Financing cash outflows 300,000 ROU assets obtained in the exchange for lease liabilities (non-cash): Operating leases $ 3,096,000 |
Future cash flows relating to operating lease liabilities | The following table is a reconciliation of future cash flows relating to operating lease liabilities presented on our Condensed Consolidated Balance Sheet as of April 30, 2020 : Operating Remaining portion of fiscal 2020 $ 2,666,000 Fiscal 2021 9,116,000 Fiscal 2022 7,730,000 Fiscal 2023 6,231,000 Fiscal 2024 4,878,000 Thereafter 7,013,000 Total future undiscounted cash flows 37,634,000 Less: Present value discount 3,289,000 Lease liabilities $ 34,345,000 Weighted-average remaining lease terms (in years) 4.71 Weighted-average discount rate 4.04 % |
Schedule of Future Minimum Rental Payments for Operating Leases | As we have not restated prior year information given our method of adopting the new standard, the following represents our future minimum lease payments for operating leases and capital leases as of July 31, 2019 under ASC Topic 840 and as reported in our Form 10-K filed with the SEC on September 24, 2019: Operating Capital Total Fiscal 2020 $ 11,812,000 789,000 $ 12,601,000 Fiscal 2021 8,723,000 — 8,723,000 Fiscal 2022 7,343,000 — 7,343,000 Fiscal 2023 5,776,000 — 5,776,000 Fiscal 2024 3,430,000 — 3,430,000 Thereafter 7,130,000 — 7,130,000 Total $ 44,214,000 789,000 $ 45,003,000 Less amount representing interest * 32,000 32,000 Present value of net minimum lease payments * $ 757,000 $ 44,971,000 *Not applicable for operating leases |
Schedule of Future Minimum Lease Payments for Capital Leases | As we have not restated prior year information given our method of adopting the new standard, the following represents our future minimum lease payments for operating leases and capital leases as of July 31, 2019 under ASC Topic 840 and as reported in our Form 10-K filed with the SEC on September 24, 2019: Operating Capital Total Fiscal 2020 $ 11,812,000 789,000 $ 12,601,000 Fiscal 2021 8,723,000 — 8,723,000 Fiscal 2022 7,343,000 — 7,343,000 Fiscal 2023 5,776,000 — 5,776,000 Fiscal 2024 3,430,000 — 3,430,000 Thereafter 7,130,000 — 7,130,000 Total $ 44,214,000 789,000 $ 45,003,000 Less amount representing interest * 32,000 32,000 Present value of net minimum lease payments * $ 757,000 $ 44,971,000 *Not applicable for operating leases |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 9 Months Ended |
Apr. 30, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Summary of Stock-based Awards Outstanding by Award Type | As of April 30, 2020 , the following stock-based awards, by award type, were outstanding: April 30, 2020 Stock options 1,139,675 Performance shares 215,234 RSUs and restricted stock 448,311 Share units 239,680 Total 2,042,900 |
Stock-based compensation for awards detailing where recorded in Condensed Consolidated Statement of Operations | Stock-based compensation for awards issued is reflected in the following line items in our Condensed Consolidated Statements of Operations: Three months ended April 30, Nine months ended April 30, 2020 2019 2020 2019 Cost of sales $ 45,000 52,000 $ 164,000 170,000 Selling, general and administrative expenses 878,000 1,004,000 2,715,000 2,960,000 Research and development expenses 58,000 63,000 219,000 226,000 Stock-based compensation expense before income tax benefit 981,000 1,119,000 3,098,000 3,356,000 Estimated income tax benefit (204,000 ) (244,000 ) (664,000 ) (732,000 ) Net stock-based compensation expense $ 777,000 875,000 $ 2,434,000 2,624,000 |
Summary of net stock-based compensation expense by award type | Stock-based compensation expense (benefit), by award type, is summarized as follows: Three months ended April 30, Nine months ended April 30, 2020 2019 2020 2019 Stock options $ 39,000 174,000 $ 203,000 526,000 Performance shares 412,000 374,000 1,185,000 1,166,000 RSUs and restricted stock 477,000 515,000 1,850,000 1,630,000 ESPP 53,000 56,000 170,000 164,000 Share units — — (310,000 ) (130,000 ) Stock-based compensation expense before income tax benefit 981,000 1,119,000 3,098,000 3,356,000 Estimated income tax benefit (204,000 ) (244,000 ) (664,000 ) (732,000 ) Net stock-based compensation expense $ 777,000 875,000 $ 2,434,000 2,624,000 |
Summary of the Plan's activity relating to stock options | The following table summarizes the Plan's activity during the nine months ended April 30, 2020 : Awards (in Shares) Weighted Average Exercise Price Weighted Average Remaining Contractual Term (Years) Aggregate Intrinsic Value Outstanding at July 31, 2019 1,555,555 $ 28.72 Exercised (51,460 ) 28.45 Expired/canceled (800 ) 27.35 Outstanding at October 31, 2019 1,503,295 28.73 Expired/canceled (100 ) 28.35 Exercised (233,330 ) 28.90 Outstanding at January 31, 2020 1,269,865 28.70 Exercised (1,000 ) 28.84 Expired/canceled (129,190 ) 29.18 Outstanding at April 30, 2020 1,139,675 $ 28.65 3.08 $ — Exercisable at April 30, 2020 1,079,985 $ 28.74 2.96 $ — Vested and expected to vest at April 30, 2020 1,116,541 $ 28.68 3.04 $ — |
Summary of the Plan's activity relating to performance shares, RSUs, restricted stock and share units | The following table summarizes the Plan's activity relating to performance shares, RSUs, restricted stock and share units: Awards (in Shares) Weighted Average Grant Date Fair Value Aggregate Intrinsic Value Outstanding at July 31, 2019 954,676 $ 22.40 Granted 219,425 27.69 Settled (199,466 ) 16.80 Forfeited (41,080 ) 21.00 Outstanding at October 31, 2019 933,555 24.91 Settled (527 ) 11.40 Forfeited (1,836 ) 23.95 Outstanding at January 31, 2020 931,192 24.92 Granted 5,064 21.64 Settled (3,884 ) 23.26 Forfeited (29,147 ) 23.40 Outstanding at April 30, 2020 903,225 $ 24.96 $ 16,719,000 Vested at April 30, 2020 326,186 $ 24.93 $ 6,038,000 Vested and expected to vest at April 30, 2020 860,595 $ 25.12 $ 15,930,000 |
Segment Information (Tables)
Segment Information (Tables) | 9 Months Ended |
Apr. 30, 2020 | |
Segment Reporting [Abstract] | |
Segment information | Operating segment information, along with a reconciliation of segment net income (loss) and consolidated net income to Adjusted EBITDA is presented in the tables below: Three months ended April 30, 2020 Commercial Solutions Government Solutions Unallocated Total Net sales $ 78,311,000 56,810,000 — $ 135,121,000 Operating income (loss) $ 4,041,000 4,194,000 (11,371,000 ) $ (3,136,000 ) Net income (loss) $ 3,462,000 4,253,000 (11,704,000 ) $ (3,989,000 ) Provision for (benefit from) income taxes 481,000 (65,000 ) (1,175,000 ) (759,000 ) Interest (income) and other 89,000 — 19,000 108,000 Interest expense 9,000 6,000 1,489,000 1,504,000 Amortization of stock-based compensation — — 981,000 981,000 Amortization of intangibles 4,313,000 1,204,000 — 5,517,000 Depreciation 1,993,000 447,000 210,000 2,650,000 Estimated contract settlement costs 476,000 — — 476,000 Acquisition plan expenses 701,000 — 5,282,000 5,983,000 Adjusted EBITDA $ 11,524,000 5,845,000 (4,898,000 ) $ 12,471,000 Purchases of property, plant and equipment $ 1,263,000 531,000 118,000 $ 1,912,000 Long-lived assets acquired in connection with the acquisitions $ 4,023,000 4,402,000 — $ 8,425,000 Total assets at April 30, 2020 $ 663,455,000 235,739,000 52,538,000 $ 951,732,000 Three months ended April 30, 2019 Commercial Solutions Government Solutions Unallocated Total Net sales $ 89,600,000 80,848,000 — $ 170,448,000 Operating income (loss) $ 8,126,000 10,053,000 (6,883,000 ) $ 11,296,000 Net income (loss) $ 8,086,000 10,073,000 (10,547,000 ) $ 7,612,000 Provision for income taxes 10,000 — 1,537,000 1,547,000 Interest (income) and other 9,000 (21,000 ) (10,000 ) (22,000 ) Interest expense 21,000 1,000 2,137,000 2,159,000 Amortization of stock-based compensation — — 1,119,000 1,119,000 Amortization of intangibles 3,692,000 844,000 — 4,536,000 Depreciation 2,374,000 367,000 177,000 2,918,000 Estimated contract settlement costs 2,465,000 — — 2,465,000 Acquisition plan expenses — — 1,704,000 1,704,000 Adjusted EBITDA $ 16,657,000 11,264,000 (3,883,000 ) $ 24,038,000 Purchases of property, plant and equipment $ 1,730,000 296,000 181,000 $ 2,207,000 Long-lived assets acquired in connection with the acquisitions $ 60,451,000 — — $ 60,451,000 Total assets at April 30, 2019 $ 665,499,000 200,442,000 37,546,000 $ 903,487,000 Nine months ended April 30, 2020 Commercial Solutions Government Solutions Unallocated Total Net sales $ 268,747,000 198,295,000 — $ 467,042,000 Operating income (loss) $ 26,501,000 16,280,000 (30,423,000 ) $ 12,358,000 Net income (loss) $ 26,031,000 16,364,000 (36,501,000 ) $ 5,894,000 Provision for (benefit from) income taxes 382,000 (65,000 ) 1,186,000 1,503,000 Interest (income) and other 62,000 (26,000 ) 1,000 37,000 Interest expense 26,000 7,000 4,891,000 4,924,000 Amortization of stock-based compensation — — 3,098,000 3,098,000 Amortization of intangibles 13,037,000 2,915,000 — 15,952,000 Depreciation 6,372,000 1,072,000 578,000 8,022,000 Estimated contract settlement costs 444,000 — — 444,000 Acquisition plan expenses 701,000 — 13,696,000 14,397,000 Adjusted EBITDA $ 47,055,000 20,267,000 (13,051,000 ) $ 54,271,000 Purchases of property, plant and equipment $ 3,178,000 956,000 286,000 $ 4,420,000 Long-lived assets acquired in connection with the acquisitions $ 6,060,000 34,609,000 — $ 40,669,000 Total assets at April 30, 2020 $ 663,455,000 235,739,000 52,538,000 $ 951,732,000 Nine months ended April 30, 2019 Commercial Solutions Government Solutions Unallocated Total Net sales $ 254,308,000 241,117,000 — $ 495,425,000 Operating income (loss) $ 23,942,000 24,480,000 (17,420,000 ) $ 31,002,000 Net income (loss) $ 23,783,000 24,505,000 (29,382,000 ) $ 18,906,000 Provision for income taxes 65,000 — 1,726,000 1,791,000 Interest (income) and other 32,000 (33,000 ) (6,000 ) (7,000 ) Write-off of deferred financing costs — — 3,217,000 3,217,000 Interest expense 62,000 8,000 7,025,000 7,095,000 Amortization of stock-based compensation — — 3,356,000 3,356,000 Amortization of intangibles 10,581,000 2,532,000 — 13,113,000 Depreciation 6,898,000 1,113,000 607,000 8,618,000 Estimated contract settlement costs 6,351,000 — — 6,351,000 Settlement of intellectual property litigation — — (3,204,000 ) (3,204,000 ) Acquisition plan expenses — — 4,612,000 4,612,000 Facility exit costs — 1,373,000 — 1,373,000 Adjusted EBITDA $ 47,772,000 29,498,000 (12,049,000 ) $ 65,221,000 Purchases of property, plant and equipment $ 4,593,000 1,357,000 438,000 $ 6,388,000 Long-lived assets acquired in connection with the acquisitions $ 60,451,000 — — $ 60,451,000 Total assets at April 30, 2019 $ 665,499,000 200,442,000 37,546,000 $ 903,487,000 |
Goodwill (Tables)
Goodwill (Tables) | 9 Months Ended |
Apr. 30, 2020 | |
Goodwill [Abstract] | |
Schedule of goodwill by segment | The following table represents goodwill by reportable operating segment, including the changes in the net carrying value of goodwill during the nine months ended April 30, 2020 : Commercial Solutions Government Solutions Total Balance as of July 31, 2019 $ 251,296,000 59,193,000 $ 310,489,000 Change related to Solacom acquisition (420,000 ) — (420,000 ) Change related to GD NG-911 acquisition 4,556,000 — 4,556,000 Change related to CGC acquisition — 20,852,000 20,852,000 Balance as of April 30, 2020 $ 255,432,000 80,045,000 $ 335,477,000 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 9 Months Ended |
Apr. 30, 2020 | |
Finite-Lived Intangible Assets, Net [Abstract] | |
Intangible assets with finite lives | Intangible assets with finite lives are as follows: As of April 30, 2020 Weighted Average Amortization Period Gross Carrying Amount Accumulated Amortization Net Carrying Amount Customer relationships 20.4 $ 284,558,000 76,205,000 $ 208,353,000 Technologies 13.7 97,649,000 63,866,000 33,783,000 Trademarks and other 16.6 32,526,000 14,500,000 18,026,000 Total $ 414,733,000 154,571,000 $ 260,162,000 As of July 31, 2019 Weighted Average Amortization Period Gross Carrying Amount Accumulated Amortization Net Carrying Amount Customer relationships 20.5 $ 276,834,000 66,484,000 $ 210,350,000 Technologies 12.7 92,649,000 59,522,000 33,127,000 Trademarks and other 16.7 31,026,000 12,613,000 18,413,000 Total $ 400,509,000 138,619,000 $ 261,890,000 |
Estimated future amortization expense | The estimated amortization expense consists of the following for the fiscal years ending July 31: 2020 $ 21,445,000 2021 21,040,000 2022 19,458,000 2023 19,458,000 2024 18,766,000 |
General Narrative (Details)
General Narrative (Details) - operating_segment | 3 Months Ended | 9 Months Ended |
Apr. 30, 2020 | Apr. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Number of reportable segments | 2 | |
Global COVID-19 Pandemic | ||
Unusual or Infrequent Item, or Both [Line Items] | ||
Global headcount reduction percentage | 10.00% |
Acquisitions (Narrative) (Detai
Acquisitions (Narrative) (Details) | Jun. 01, 2020 | May 31, 2020USD ($) | Apr. 30, 2020USD ($) | Feb. 21, 2020USD ($) | Jan. 27, 2020USD ($)$ / sharesshares | Apr. 29, 2019USD ($)employee | Feb. 28, 2019USD ($)shares | Jul. 31, 2020USD ($) | Apr. 30, 2020USD ($) | Apr. 30, 2019USD ($) | Sep. 30, 2020USD ($)$ / shares | Apr. 30, 2020USD ($) | Apr. 30, 2019USD ($) | Dec. 31, 2019USD ($) | Jan. 29, 2020USD ($) | Jul. 31, 2019USD ($) |
Business Acquisition [Line Items] | ||||||||||||||||
Revenue | $ 135,121,000 | $ 170,448,000 | $ 467,042,000 | $ 495,425,000 | ||||||||||||
Operating income | (3,136,000) | $ 11,296,000 | 12,358,000 | $ 31,002,000 | ||||||||||||
Cash and cash equivalents | $ 50,634,000 | 50,634,000 | 50,634,000 | $ 45,576,000 | ||||||||||||
Debt | 159,400,000 | 159,400,000 | 159,400,000 | $ 165,000,000 | ||||||||||||
Gilat | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Revenue | $ 263,492,000 | |||||||||||||||
Operating income | 25,572,000 | |||||||||||||||
Cash and cash equivalents | 74,778,000 | |||||||||||||||
Debt | $ 8,096,000 | |||||||||||||||
Secured Credit Facility | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Secured credit facility, maximum borrowing capacity | 550,000,000 | $ 550,000,000 | $ 550,000,000 | |||||||||||||
Secured Credit Facility | Forecast | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Secured credit facility, maximum borrowing capacity | $ 800,000,000 | |||||||||||||||
Solacom | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Aggregate purchase price | $ 32,934,000 | |||||||||||||||
Aggregate purchase price - settled in cash | 27,328,000 | |||||||||||||||
Aggregate purchase price - settled with issuance of common stock | $ 5,606,000 | |||||||||||||||
Aggregate purchase price - settled with issuance of common stock (in shares) | shares | 208,669 | |||||||||||||||
Consideration transferred, net of cash acquired | $ 31,489,000 | |||||||||||||||
Cash acquired from acquisition | $ 1,445,000 | |||||||||||||||
GD NG-911 business | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Aggregate purchase price | $ 11,013,000 | |||||||||||||||
Development contract term | 5 years | |||||||||||||||
Number of employees hired | employee | 60 | |||||||||||||||
CGC Technology | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Aggregate purchase price | 23,650,000 | $ 23,650,000 | ||||||||||||||
Aggregate purchase price - settled in cash | 12,075,000 | 12,075,000 | ||||||||||||||
Aggregate purchase price - settled with issuance of common stock | $ 11,575,000 | $ 11,575,000 | ||||||||||||||
Aggregate purchase price - settled with issuance of common stock (in shares) | shares | 323,504 | |||||||||||||||
Consideration transferred, net of cash acquired | $ 22,740,000 | |||||||||||||||
Cash acquired from acquisition | $ 160,000 | |||||||||||||||
Weighted average stock price (in dollars per share) | $ / shares | $ 35.78 | |||||||||||||||
Payable subject to closing conditions | $ 750,000 | |||||||||||||||
UHP Networks | Forecast | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Aggregate purchase price | 38,000,000 | |||||||||||||||
Aggregate purchase price - settled in cash | $ 5,000,000 | |||||||||||||||
Gilat | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Enterprise value | $ 532,500,000 | |||||||||||||||
Gilat | Forecast | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Consideration, cash, per share (in usd per share) | $ / shares | $ 7.18 | |||||||||||||||
Consideration, shares, share issuance ratio | 0.08425 | |||||||||||||||
Transaction related costs, capitalized and expensed | $ 31,678,000 | |||||||||||||||
NG-911 | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Aggregate purchase price | $ 1,188,000 | |||||||||||||||
Aggregate purchase price - settled in cash | 781,000 | |||||||||||||||
Earn out additional payable | $ 407,000 | |||||||||||||||
Earn out additional payable, term | 5 years | |||||||||||||||
Subsequent Event | UHP Networks | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Percent reduction in previously agreed-upon purchase price | 24.00% | |||||||||||||||
Previously agreed-upon purchase price | $ 50,000,000 |
Acquisitions (Fair Value of Ass
Acquisitions (Fair Value of Assets Acquired and Liabilities Assumed) (Details) - USD ($) | Apr. 30, 2020 | Jan. 27, 2020 | Apr. 30, 2020 | Apr. 30, 2020 | Jul. 31, 2019 |
Business Acquisition [Line Items] | |||||
Goodwill | $ 335,477,000 | $ 335,477,000 | $ 335,477,000 | $ 310,489,000 | |
Customer relationships | |||||
Measurement Period Adjustments | |||||
Estimated useful lives | 20 years 5 months | 20 years 6 months | |||
CGC Technology | |||||
Business Acquisition [Line Items] | |||||
Settled or payable in cash | 12,075,000 | $ 12,075,000 | |||
Settled or payable in common stock issued by Comtech | 11,575,000 | 11,575,000 | |||
Preliminary purchase price at fair value | 23,650,000 | 23,650,000 | |||
Cash and cash equivalents | 160,000 | 160,000 | 160,000 | $ 160,000 | |
Current assets | 4,390,000 | 3,336,000 | 4,390,000 | 4,390,000 | |
Property, plant and equipment | 1,457,000 | 1,457,000 | 1,457,000 | 1,457,000 | |
Operating lease assets | 924,000 | 924,000 | 924,000 | 924,000 | |
Deferred tax assets, non-current | 1,075,000 | 588,000 | 1,075,000 | 1,075,000 | |
Contract liabilities | (6,890,000) | 0 | (6,890,000) | (6,890,000) | |
Accrued warranty obligations | (1,000,000) | (1,000,000) | (1,000,000) | (1,000,000) | |
Other current liabilities | (6,198,000) | (7,060,000) | (6,198,000) | (6,198,000) | |
Non-current liabilities | (1,329,000) | (1,329,000) | (1,329,000) | (1,329,000) | |
Net tangible liabilities at preliminary fair value | (7,411,000) | (2,924,000) | (7,411,000) | (7,411,000) | |
Deferred tax liabilities | (2,091,000) | (2,176,000) | (2,091,000) | (2,091,000) | |
Goodwill | 20,852,000 | 15,950,000 | 20,852,000 | 20,852,000 | |
Allocation of aggregate purchase price | 23,650,000 | 23,650,000 | 23,650,000 | 23,650,000 | |
Measurement Period Adjustments | |||||
Current assets | 1,054,000 | ||||
Deferred tax assets, non-current | 487,000 | ||||
Contract liabilities | (6,890,000) | ||||
Other current liabilities | 862,000 | ||||
Net tangible liabilities at preliminary fair value | (4,487,000) | ||||
Deferred tax liabilities | 85,000 | ||||
Goodwill | 4,902,000 | ||||
CGC Technology | Technology | |||||
Business Acquisition [Line Items] | |||||
Identifiable intangible assets | 5,000,000 | $ 5,000,000 | 5,000,000 | 5,000,000 | |
Measurement Period Adjustments | |||||
Estimated useful lives | 20 years | ||||
CGC Technology | Customer relationships | |||||
Business Acquisition [Line Items] | |||||
Identifiable intangible assets | 6,500,000 | $ 7,000,000 | 6,500,000 | 6,500,000 | |
Measurement Period Adjustments | |||||
Identifiable intangible assets | (500,000) | ||||
Estimated useful lives | 15 years | ||||
CGC Technology | Trade name | |||||
Business Acquisition [Line Items] | |||||
Identifiable intangible assets | $ 800,000 | $ 800,000 | $ 800,000 | $ 800,000 | |
Measurement Period Adjustments | |||||
Estimated useful lives | 5 years |
Revenue Revenue - Sale Informat
Revenue Revenue - Sale Information, Percent (Details) | 3 Months Ended | 9 Months Ended | ||
Apr. 30, 2020 | Apr. 30, 2019 | Apr. 30, 2020 | Apr. 30, 2019 | |
Concentration Risk [Line Items] | ||||
Entity wide revenue percentage by major customer type | 100.00% | 100.00% | 100.00% | 100.00% |
U.S. government | ||||
Concentration Risk [Line Items] | ||||
Entity wide revenue percentage by major customer type | 30.70% | 38.90% | 38.10% | 42.70% |
Domestic | ||||
Concentration Risk [Line Items] | ||||
Entity wide revenue percentage by major customer type | 45.00% | 34.70% | 38.80% | 32.70% |
Total United States | ||||
Concentration Risk [Line Items] | ||||
Entity wide revenue percentage by major customer type | 75.70% | 73.60% | 76.90% | 75.40% |
International | ||||
Concentration Risk [Line Items] | ||||
Entity wide revenue percentage by major customer type | 24.30% | 26.40% | 23.10% | 24.60% |
Revenue - Disaggregation of Rev
Revenue - Disaggregation of Revenues (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Apr. 30, 2020 | Apr. 30, 2019 | Apr. 30, 2020 | Apr. 30, 2019 | |
Disaggregation of Revenue [Line Items] | ||||
Revenues | $ 135,121,000 | $ 170,448,000 | $ 467,042,000 | $ 495,425,000 |
Point in time | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 57,923,000 | 88,013,000 | 205,117,000 | 269,795,000 |
Over time | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 77,198,000 | 82,435,000 | 261,925,000 | 225,630,000 |
Firm fixed price | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 116,632,000 | 145,576,000 | 393,995,000 | 428,062,000 |
Cost reimbursable | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 18,489,000 | 24,872,000 | 73,047,000 | 67,363,000 |
U.S. government | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 41,498,000 | 66,362,000 | 178,108,000 | 211,706,000 |
Domestic | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 60,813,000 | 59,123,000 | 181,444,000 | 162,088,000 |
Total United States | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 102,311,000 | 125,485,000 | 359,552,000 | 373,794,000 |
International | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 32,810,000 | 44,963,000 | 107,490,000 | 121,631,000 |
Commercial Solutions | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 78,311,000 | 89,600,000 | 268,747,000 | 254,308,000 |
Commercial Solutions | Point in time | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 25,730,000 | 43,935,000 | 106,464,000 | 127,912,000 |
Commercial Solutions | Over time | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 52,581,000 | 45,665,000 | 162,283,000 | 126,396,000 |
Commercial Solutions | Firm fixed price | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 77,553,000 | 88,125,000 | 265,318,000 | 249,982,000 |
Commercial Solutions | Cost reimbursable | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 758,000 | 1,475,000 | 3,429,000 | 4,326,000 |
Commercial Solutions | U.S. government | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 7,230,000 | 17,229,000 | 41,167,000 | 52,360,000 |
Commercial Solutions | Domestic | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 51,499,000 | 48,248,000 | 158,856,000 | 134,178,000 |
Commercial Solutions | Total United States | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 58,729,000 | 65,477,000 | 200,023,000 | 186,538,000 |
Commercial Solutions | International | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 19,582,000 | 24,123,000 | 68,724,000 | 67,770,000 |
Government Solutions | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 56,810,000 | 80,848,000 | 198,295,000 | 241,117,000 |
Government Solutions | Point in time | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 32,193,000 | 44,078,000 | 98,653,000 | 141,883,000 |
Government Solutions | Over time | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 24,617,000 | 36,770,000 | 99,642,000 | 99,234,000 |
Government Solutions | Firm fixed price | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 39,079,000 | 57,451,000 | 128,677,000 | 178,080,000 |
Government Solutions | Cost reimbursable | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 17,731,000 | 23,397,000 | 69,618,000 | 63,037,000 |
Government Solutions | U.S. government | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 34,268,000 | 49,133,000 | 136,941,000 | 159,346,000 |
Government Solutions | Domestic | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 9,314,000 | 10,875,000 | 22,588,000 | 27,910,000 |
Government Solutions | Total United States | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 43,582,000 | 60,008,000 | 159,529,000 | 187,256,000 |
Government Solutions | International | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | $ 13,228,000 | $ 20,840,000 | $ 38,766,000 | $ 53,861,000 |
Revenue - Narrative (Details)
Revenue - Narrative (Details) - USD ($) | 9 Months Ended | |
Apr. 30, 2020 | Apr. 30, 2019 | |
Revenue from Contract with Customer [Abstract] | ||
Contract assets, increase due to business combinations | $ 824,000 | |
Contract liabilities, increase due to business combinations | 6,208,000 | |
Revenue recognized | 31,000,000 | $ 30,061,000 |
Remaining performance obligation, amount | $ 640,702,000 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-05-01 | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Estimated period to satisfy a substantial portion of remaining performance obligations | 24 months |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Apr. 30, 2020 | Apr. 30, 2019 | Apr. 30, 2020 | Apr. 30, 2019 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Share repurchased during period (in shares) | 0 | 0 | 0 | 0 |
Weighted average performance shares outstanding during the period that are excluded from EPS Calculation (in shares) | 203,000 | 246,000 | 201,000 | 242,000 |
Numerator: | ||||
Net (loss) income for basic calculation | $ (3,989,000) | $ 7,612,000 | $ 5,894,000 | $ 18,906,000 |
Numerator for diluted calculation | $ (3,989,000) | $ 7,612,000 | $ 5,894,000 | $ 18,906,000 |
Denominator: | ||||
Denominator for basic calculation (in shares) | 24,982,000 | 24,192,000 | 24,730,000 | 24,074,000 |
Effect of dilutive securities: Stock-based awards (in shares) | 0 | 138,000 | 162,000 | 189,000 |
Denominator for diluted calculation (in shares) | 24,982,000 | 24,330,000 | 24,892,000 | 24,263,000 |
Stock options, performance shares (with the performance conditions satisfied), RSUs and restricted stock | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Anti-dilutive equity-classified stock-based awards not included in calculation of diluted earnings per share (in shares) | 1,440,000 | 1,674,000 | 642,000 | 1,103,000 |
Accounts Receivable (Details)
Accounts Receivable (Details) - USD ($) | Apr. 30, 2020 | Jul. 31, 2019 | Apr. 30, 2020 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Total accounts receivable | $ 139,717,000 | $ 146,899,000 | $ 139,717,000 |
Less allowance for doubtful accounts | 1,830,000 | 1,867,000 | 1,830,000 |
Accounts receivable, net | $ 137,887,000 | $ 145,032,000 | 137,887,000 |
U.S. government | Accounts Receivable | Customer concentration risk | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Concentration risk, percentage | 32.10% | 27.80% | |
Verizon | Accounts Receivable | Customer concentration risk | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Concentration risk, percentage | 10.20% | ||
Billed Receivables | Commercial and International | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Total accounts receivable | $ 76,909,000 | $ 85,556,000 | 76,909,000 |
Billed Receivables | U.S. government | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Total accounts receivable | 40,687,000 | 38,856,000 | $ 40,687,000 |
Unbilled Receivables | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Maximum period that management estimates unbilled accounts receivable to be billed and collected | 1 year | ||
Unbilled Receivables | Commercial and International | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Total accounts receivable | 17,919,000 | 20,469,000 | $ 17,919,000 |
Unbilled Receivables | U.S. government | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Total accounts receivable | $ 4,202,000 | $ 2,018,000 | $ 4,202,000 |
Inventories (Details)
Inventories (Details) - USD ($) | Apr. 30, 2020 | Jul. 31, 2019 |
Inventory Disclosure [Abstract] | ||
Raw materials and components | $ 60,203,000 | $ 53,959,000 |
Work-in-process and finished goods | 38,070,000 | 40,576,000 |
Total inventories | 98,273,000 | 94,535,000 |
Less reserve for excess and obsolete inventories | 18,850,000 | 19,696,000 |
Inventories, net | 79,423,000 | 74,839,000 |
Inventory directly related to long-term contracts | 6,410,000 | 4,053,000 |
Inventory related to contracts from third party commercial customers who outsource their manufacturing to us | $ 1,606,000 | $ 1,513,000 |
Accrued Expenses and Other Cu_3
Accrued Expenses and Other Current Liabilities - Schedule (Details) - USD ($) | Apr. 30, 2020 | Jul. 31, 2019 | Apr. 30, 2019 | Jul. 31, 2018 |
Accrued Liabilities, Current [Abstract] | ||||
Accrued wages and benefits | $ 23,473,000 | $ 23,295,000 | ||
Accrued contract costs | 12,383,000 | 15,007,000 | ||
Accrued warranty obligations | 15,504,000 | 15,968,000 | $ 14,263,000 | $ 11,738,000 |
Accrued legal costs | 2,880,000 | 2,835,000 | ||
Accrued commissions and royalties | 4,131,000 | 5,114,000 | ||
Other | 25,190,000 | 16,365,000 | ||
Accrued expenses and other current liabilities | $ 83,561,000 | $ 78,584,000 |
Accrued Expenses and Other Cu_4
Accrued Expenses and Other Current Liabilities - Product Warranty Rollforward (Details) - USD ($) | 9 Months Ended | |
Apr. 30, 2020 | Apr. 30, 2019 | |
Changes in Product Warranty Liability | ||
Balance at beginning of period | $ 15,968,000 | $ 11,738,000 |
Provision for warranty obligations | 1,628,000 | 1,320,000 |
Additions (in connection with acquisitions) | 1,000,000 | 6,431,000 |
Charges incurred | (3,394,000) | (4,828,000) |
Warranty settlement and reclass | 302,000 | 1,281,000 |
Balance at end of period | $ 15,504,000 | $ 14,263,000 |
Accrued Expenses and Other Cu_5
Accrued Expenses and Other Current Liabilities - Narrative (Details) | 9 Months Ended | 12 Months Ended | ||||
Apr. 30, 2020USD ($) | Jul. 31, 2018USD ($)credit | Aug. 01, 2019USD ($) | Jul. 31, 2019USD ($) | Apr. 30, 2019USD ($) | Aug. 01, 2018USD ($) | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||
Operating lease right-of-use assets, net | $ 31,942,000 | $ 0 | ||||
Operating lease liabilities, current | $ 8,480,000 | 0 | ||||
Minimum coverage period of product warranty from the date of shipment | 1 year | |||||
Accrued warranty obligations | $ 15,504,000 | $ 11,738,000 | 15,968,000 | $ 14,263,000 | ||
ASU 2016-02 | ||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||
Accrued expenses and other current liabilities | $ 2,934,000 | |||||
Operating lease right-of-use assets, net | 35,825,000 | |||||
Estimated facility exit costs | 568,000 | |||||
Operating lease liabilities, current | 568,000 | |||||
ASU 2016-02, Accrued expenses and other current liabilities adjustment | ||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||
Short-term deferred rent liabilities | 2,366,000 | |||||
Operating lease right-of-use assets, net | 2,366,000 | |||||
Estimated facility exit costs | 568,000 | |||||
Operating lease liabilities, current | $ 568,000 | |||||
Difference between Revenue Guidance in Effect before and after Topic 606 | ASU 2014-09 | ||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||
Accrued warranty obligations | $ (1,679,000) | |||||
TeleCommunication Systems Inc. | TCS 911 call handling software solution | ||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||
Accrued warranty obligations | 2,604,000 | $ 3,999,000 | ||||
Full and final warranty settlement with AT&T | TeleCommunication Systems Inc. | TCS 911 call handling software solution | ||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||
Number of monthly credits issued | credit | 36 | |||||
Amount of monthly credit | $ 153,000 | |||||
Present value of monthly credits | $ 748,000 |
Prior Period Cost Reduction A_2
Prior Period Cost Reduction Actions - Narrative (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||||
Apr. 30, 2020 | Apr. 30, 2019 | Apr. 30, 2020 | Apr. 30, 2019 | Aug. 01, 2019 | Jul. 31, 2019 | |
Restructuring Cost and Reserve [Line Items] | ||||||
Facility exit costs | $ 1,373,000 | |||||
Operating lease liabilities, current | $ 8,480,000 | $ 8,480,000 | $ 0 | |||
Estimated contract settlement costs | 476,000 | $ 2,465,000 | 444,000 | 6,351,000 | ||
Government Solutions Segment | Operating Segments | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Facility exit costs | 1,373,000 | |||||
Estimated contract settlement costs | 0 | 0 | 0 | 0 | ||
Commercial Solutions Segment | Operating Segments | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Facility exit costs | 0 | |||||
Estimated contract settlement costs | $ 476,000 | $ 2,465,000 | $ 444,000 | $ 6,351,000 | ||
ASU 2016-02 | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Estimated facility exit costs | $ 568,000 | |||||
Operating lease liabilities, current | $ 568,000 |
Credit Facility (Details)
Credit Facility (Details) | Apr. 30, 2020USD ($) | Apr. 30, 2020USD ($) | Apr. 30, 2019USD ($) | Apr. 30, 2020USD ($) | Apr. 30, 2019USD ($) | Jul. 31, 2020USD ($) | Oct. 31, 2018USD ($) |
Line of Credit Facility [Line Items] | |||||||
Write-off of deferred financing costs | $ 0 | $ 0 | $ 0 | $ 3,217,000 | |||
New debt issuance maximum amount | $ 5,000,000 | 5,000,000 | $ 5,000,000 | ||||
Triggering event, days before maturity of old debt | 91 days | ||||||
Long-term line of credit | 159,400,000 | 159,400,000 | $ 159,400,000 | ||||
Secured Credit Facility | |||||||
Line of Credit Facility [Line Items] | |||||||
Write-off of deferred financing costs | 3,217,000 | ||||||
Capitalized deferred financing costs | $ 1,813,000 | ||||||
Secured credit facility, maximum borrowing capacity | 550,000,000 | 550,000,000 | 550,000,000 | ||||
Outstanding standby letters of credit at period end | 2,672,000 | 2,672,000 | 2,672,000 | ||||
Outstanding commercial letters of credit at period end | 0 | 0 | 0 | ||||
Unamortized deferred financing costs | $ 2,575,000 | 2,575,000 | 2,575,000 | ||||
Interest expense including amortization of deferred financing costs | $ 1,470,000 | $ 2,067,000 | $ 4,795,000 | $ 6,780,000 | |||
Blended interest rate (percent) | 3.73% | 5.00% | 4.24% | 5.36% | |||
Maximum Secured Leverage Ratio | 3.75 | 3.75 | 3.75 | ||||
Maximum Total Leverage Ratio | 4.5 | 4.5 | 4.5 | ||||
Minimum Interest Expense Coverage Ratio | 3.25 | ||||||
Secured Leverage Ratio | 1.93 | 1.93 | 1.93 | ||||
Interest Expense Coverage Ratio | 13.37 | ||||||
Revolving Loan Facility | Secured Credit Facility | |||||||
Line of Credit Facility [Line Items] | |||||||
Secured credit facility, maximum borrowing capacity | $ 300,000,000 | $ 300,000,000 | $ 300,000,000 | ||||
Line of credit facility, accordion feature | 250,000,000 | 250,000,000 | 250,000,000 | ||||
Swingline Loan | Secured Credit Facility | |||||||
Line of Credit Facility [Line Items] | |||||||
Secured credit facility, maximum borrowing capacity | 25,000,000 | 25,000,000 | 25,000,000 | ||||
Letter of Credit | Secured Credit Facility | |||||||
Line of Credit Facility [Line Items] | |||||||
Secured credit facility, maximum borrowing capacity | $ 35,000,000 | $ 35,000,000 | 35,000,000 | ||||
October 2018 Credit Facility | |||||||
Line of Credit Facility [Line Items] | |||||||
Minimum amount outstanding during period | 137,000,000 | ||||||
Maximum amount outstanding during period | $ 174,000,000 | ||||||
Federal Funds Effective Rate | Revolving Loan Facility | Secured Credit Facility | |||||||
Line of Credit Facility [Line Items] | |||||||
Variable interest rate (percent) | 0.50% | ||||||
Adjusted LIBO rate | Revolving Loan Facility | Secured Credit Facility | |||||||
Line of Credit Facility [Line Items] | |||||||
Variable interest rate (percent) | 1.00% | ||||||
Forecast | Secured Credit Facility | |||||||
Line of Credit Facility [Line Items] | |||||||
Secured credit facility, maximum borrowing capacity | $ 800,000,000 |
Leases - Narrative (Details)
Leases - Narrative (Details) - USD ($) | 9 Months Ended | ||
Apr. 30, 2020 | Aug. 01, 2019 | Jul. 31, 2019 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Operating lease right-of-use assets, net | $ 31,942,000 | $ 0 | |
Deferred rent liability | $ 3,023,000 | ||
Lease liabilities | 34,345,000 | ||
ASU 2016-02 | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Operating lease right-of-use assets, net | 35,825,000 | ||
Lease liabilities | $ 38,848,000 | ||
Executive Chairman [Member] | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Lease payments to related party | $ 486,000 | ||
Option for additional term | 10 years | ||
Annual rent | $ 657,000 |
Leases - Lease Cost and Additio
Leases - Lease Cost and Additional Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended |
Apr. 30, 2020 | Apr. 30, 2020 | |
Leases [Abstract] | ||
Amortization of ROU assets | $ 0 | $ 152,000 |
Interest on lease liabilities | 0 | 3,000 |
Operating lease expense | 2,733,000 | 8,069,000 |
Short-term lease expense | 798,000 | 2,539,000 |
Variable lease expense | 1,004,000 | 3,013,000 |
Sublease income | (5,000) | (5,000) |
Total lease expense | $ 4,530,000 | 13,771,000 |
Operating leases - Operating cash outflows | 8,681,000 | |
Finance leases - Operating cash outflows | 3,000 | |
Finance leases - Financing cash outflows | 300,000 | |
ROU assets obtained in the exchange for lease liabilities (non-cash): operating leases | $ 3,096,000 |
Leases - Operating and Finance
Leases - Operating and Finance Lease Liabilities (Details) | Apr. 30, 2020USD ($) |
Leases [Abstract] | |
Remaining portion of fiscal 2020 | $ 2,666,000 |
Fiscal 2021 | 9,116,000 |
Fiscal 2022 | 7,730,000 |
Fiscal 2023 | 6,231,000 |
Fiscal 2024 | 4,878,000 |
Thereafter | 7,013,000 |
Total future undiscounted cash flows | 37,634,000 |
Less: Present value discount | 3,289,000 |
Lease liabilities | $ 34,345,000 |
Weighted-average remaining lease terms | 4 years 8 months 15 days |
Weighted-average discount rate | 4.04% |
Leases - Lease Maturity Under T
Leases - Lease Maturity Under Topic 840 (Details) | Jul. 31, 2019USD ($) |
Operating | |
Fiscal 2020 | $ 11,812,000 |
Fiscal 2021 | 8,723,000 |
Fiscal 2022 | 7,343,000 |
Fiscal 2023 | 5,776,000 |
Fiscal 2024 | 3,430,000 |
Thereafter | 7,130,000 |
Total | 44,214,000 |
Capital | |
Fiscal 2020 | 789,000 |
Fiscal 2021 | 0 |
Fiscal 2022 | 0 |
Fiscal 2023 | 0 |
Fiscal 2024 | 0 |
Thereafter | 0 |
Total | 789,000 |
Less amount representing interest | 32,000 |
Present value of net minimum lease payments | 757,000 |
Total | |
Fiscal 2020 | 12,601,000 |
Fiscal 2021 | 8,723,000 |
Fiscal 2022 | 7,343,000 |
Fiscal 2023 | 5,776,000 |
Fiscal 2024 | 3,430,000 |
Thereafter | 7,130,000 |
Total | 45,003,000 |
Present value of net minimum lease payments | $ 44,971,000 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) | Apr. 30, 2020 | Jul. 31, 2019 |
Income Tax Contingency [Line Items] | ||
Unrecognized tax benefits | $ 8,309,000 | $ 7,215,000 |
Interest accrued relating to income taxes | 73,000 | 12,000 |
Unrecognized tax benefits that would positively impact our effective tax rate, if recognized | 7,663,000 | 6,670,000 |
Non-current income taxes payable | ||
Income Tax Contingency [Line Items] | ||
Unrecognized tax benefits | 2,316,000 | 325,000 |
Included in the non-current deferred tax liabilities (as an offset to the associated deferred tax asset) | ||
Income Tax Contingency [Line Items] | ||
Unrecognized tax benefits | $ 5,993,000 | $ 6,890,000 |
Stock-Based Compensation - Over
Stock-Based Compensation - Overview (Details) - shares | 9 Months Ended | |||
Apr. 30, 2020 | Jan. 31, 2020 | Oct. 31, 2019 | Jul. 31, 2019 | |
Stock options | ||||
Stock-Based Awards Outstanding By Award Type | ||||
Number of stock-based option awards outstanding at period end (in shares) | 1,139,675 | 1,269,865 | 1,503,295 | 1,555,555 |
2000 Stock Incentive Plan | ||||
2000 Stock Incentive Plan | ||||
Authorized for issuance (in shares) | 10,962,500 | |||
Aggregate net number of stock-based awards granted (in shares) | 8,568,523 | |||
Aggregate number of stock based awards expired and canceled (in shares) | 4,191,578 | |||
Aggregate number of stock-based awards exercised or settled (in shares) | 6,525,623 | |||
Stock-Based Awards Outstanding By Award Type | ||||
Number of total stock-based awards outstanding (in shares) | 2,042,900 | |||
2000 Stock Incentive Plan | Stock options | ||||
2000 Stock Incentive Plan | ||||
Contractual term | 10 years | |||
Percentage of a stockholder's voting power that limits the contractual term of an incentive stock-based award | 10.00% | |||
Maximum term for incentive stock-based awards granted to stockholders who own more than 10% of the voting power | 5 years | |||
Stock-Based Awards Outstanding By Award Type | ||||
Number of stock-based option awards outstanding at period end (in shares) | 1,139,675 | |||
2000 Stock Incentive Plan | Performance shares | ||||
Stock-Based Awards Outstanding By Award Type | ||||
Number of stock-based non-option awards outstanding at period end (in shares) | 215,234 | |||
2000 Stock Incentive Plan | RSUs and restricted stock | ||||
Stock-Based Awards Outstanding By Award Type | ||||
Number of stock-based non-option awards outstanding at period end (in shares) | 448,311 | |||
2000 Stock Incentive Plan | Share units | ||||
Stock-Based Awards Outstanding By Award Type | ||||
Number of stock-based non-option awards outstanding at period end (in shares) | 239,680 | |||
2001 Employee Stock Purchase Plan | ESPP | ||||
2000 Stock Incentive Plan | ||||
Authorized for issuance (in shares) | 1,050,000 | |||
2001 Employee Stock Purchase Plan | ||||
Discount rate from market value, on purchase date, offered to employees participating in the Employee Stock Purchase Plan (ESPP) | 85.00% | |||
Total number of shares of common stock issued to employees under employee stock purchase plan and through the end of the reporting period (in shares) | 823,219 |
Stock-Based Compensation - Expe
Stock-Based Compensation - Expenses (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||||
Apr. 30, 2020 | Apr. 30, 2019 | Apr. 30, 2020 | Apr. 30, 2019 | Jan. 31, 2020 | Oct. 31, 2019 | Jul. 31, 2019 | |
Stock-based Compensation Expenses | |||||||
Stock-based compensation expense before income tax benefit | $ 981,000 | $ 1,119,000 | $ 3,098,000 | $ 3,356,000 | |||
Estimated income tax benefit | (204,000) | (244,000) | (664,000) | (732,000) | |||
Net stock-based compensation expense | 777,000 | 875,000 | 2,434,000 | 2,624,000 | |||
Total remaining unrecognized compensation cost related to the unvested stock-based awards | 9,153,000 | 9,153,000 | |||||
Estimated forfeitures related to unvested stock-based awards | 1,065,000 | $ 1,065,000 | |||||
Weighted average number of years net compensation cost is expected to be recognized over | 2 years 11 months 14 days | ||||||
Stock-based compensation capitalized and included in ending inventory | 48,000 | $ 48,000 | $ 48,000 | ||||
Cost of sales | |||||||
Stock-based Compensation Expenses | |||||||
Stock-based compensation expense before income tax benefit | 45,000 | 52,000 | 164,000 | 170,000 | |||
Selling, general and administrative expenses | |||||||
Stock-based Compensation Expenses | |||||||
Stock-based compensation expense before income tax benefit | 878,000 | 1,004,000 | 2,715,000 | 2,960,000 | |||
Research and development expenses | |||||||
Stock-based Compensation Expenses | |||||||
Stock-based compensation expense before income tax benefit | $ 58,000 | 63,000 | $ 219,000 | 226,000 | |||
Stock Appreciation Rights (SARs) [Member] | |||||||
Stock-based Compensation Expenses | |||||||
Number of stock-based option awards outstanding at period end (in shares) | 0 | 0 | 0 | ||||
Stock options | |||||||
Stock-based Compensation Expenses | |||||||
Stock-based compensation expense before income tax benefit | $ 39,000 | 174,000 | $ 203,000 | 526,000 | |||
Number of stock-based option awards outstanding at period end (in shares) | 1,139,675 | 1,139,675 | 1,269,865 | 1,503,295 | 1,555,555 | ||
Performance Shares | |||||||
Stock-based Compensation Expenses | |||||||
Stock-based compensation expense before income tax benefit | $ 412,000 | 374,000 | $ 1,185,000 | 1,166,000 | |||
RSUs and restricted stock | |||||||
Stock-based Compensation Expenses | |||||||
Stock-based compensation expense before income tax benefit | 477,000 | 515,000 | 1,850,000 | 1,630,000 | |||
ESPP | |||||||
Stock-based Compensation Expenses | |||||||
Stock-based compensation expense before income tax benefit | 53,000 | 56,000 | $ 170,000 | 164,000 | |||
ESPP | 2001 Employee Stock Purchase Plan | |||||||
Stock-based Compensation Expenses | |||||||
Discount offered to employees participating in the ESPP as a percentage of market price | 15.00% | ||||||
Share units | |||||||
Stock-based Compensation Expenses | |||||||
Stock-based compensation expense before income tax benefit | $ 0 | $ 0 | $ (310,000) | $ (130,000) |
Stock-Based Compensation - Stoc
Stock-Based Compensation - Stock Options (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||||
Apr. 30, 2020 | Jan. 31, 2020 | Oct. 31, 2019 | Apr. 30, 2019 | Apr. 30, 2020 | Apr. 30, 2019 | |
Additional Disclosures | ||||||
Net settlement of stock-based awards (in shares) | 27,992 | 9,345 | ||||
Stock options | ||||||
Awards (in Shares) | ||||||
Outstanding, Beginning Balance (in shares) | 1,269,865 | 1,503,295 | 1,555,555 | 1,555,555 | ||
Exercised (in shares) | (1,000) | (233,330) | (51,460) | |||
Expired/canceled (in shares) | (129,190) | (100) | (800) | |||
Outstanding, Ending Balance (in shares) | 1,139,675 | 1,269,865 | 1,503,295 | 1,139,675 | ||
Exercisable (in shares) | 1,079,985 | 1,079,985 | ||||
Vested and Expected to Vest, Ending Balance (in shares) | 1,116,541 | 1,116,541 | ||||
Weighted Average Exercise Price | ||||||
Outstanding, Beginning Balance (in dollars per share) | $ 28.70 | $ 28.73 | $ 28.72 | $ 28.72 | ||
Exercised (in dollars per share) | 28.84 | 28.90 | 28.45 | |||
Expired/canceled (in dollars per share) | 29.18 | 28.35 | 27.35 | |||
Outstanding, Ending Balance (in dollars per share) | 28.65 | $ 28.70 | $ 28.73 | 28.65 | ||
Exercisable, Ending Balance (in dollars per share) | 28.74 | 28.74 | ||||
Vested and Expected to Vest, Ending Balance (in dollars per share) | $ 28.68 | $ 28.68 | ||||
Weighted Average Remaining Contractual Term (Years) | ||||||
Outstanding, Ending Balance | 3 years 30 days | |||||
Exercisable, Ending Balance | 2 years 11 months 14 days | |||||
Vested And Expected To Vest, Ending Balance | 3 years 13 days | |||||
Aggregate Intrinsic Value | ||||||
Outstanding, Ending Balance | $ 0 | $ 0 | ||||
Exercisable, Ending Balance | 0 | 0 | ||||
Vested and Expected to Vest, Ending Balance | 0 | $ 0 | ||||
Additional Disclosures | ||||||
Exercise price, lower range limit (in dollars per share) | $ 20.90 | |||||
Exercise price, upper range limit (in dollars per share) | $ 33.94 | |||||
Total intrinsic value of stock-based awards settled | $ 5,000 | $ 0 | $ 1,869,000 | $ 561,000 | ||
Vested stock based awards net settled upon exercise (in shares) | 269,090 | 72,830 | ||||
Minimum | Stock options | ||||||
Additional Disclosures | ||||||
Contractual term | 5 years | |||||
Vesting period | 3 years | |||||
Maximum | Stock options | ||||||
Additional Disclosures | ||||||
Contractual term | 10 years | |||||
Vesting period | 5 years |
Stock-Based Compensation - Perf
Stock-Based Compensation - Performance Shares, RSUs, Restricted Stock and Share Unit Awards, and Additional Information (Details) | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||||
May 31, 2020USD ($)$ / sharesshares | Apr. 30, 2020USD ($)$ / sharesshares | Jan. 31, 2020$ / sharesshares | Oct. 31, 2019$ / sharesshares | Apr. 30, 2019USD ($) | Apr. 30, 2020USD ($)$ / sharesshares | Apr. 30, 2019USD ($) | Jul. 31, 2019USD ($) | |
Additional Disclosures | ||||||||
Accrual of dividend equivalents, net of reversal | $ 56,000 | $ 82,000 | $ 169,000 | $ 248,000 | ||||
Carrying value at period end | 405,907,000 | 405,907,000 | $ 352,629,000 | |||||
Settlement of stock-based awards, income tax expense (benefit) | $ 122,000 | (52,000) | $ (349,000) | (505,000) | ||||
Subsequent Event | ||||||||
Additional Disclosures | ||||||||
Estimated fair value, net of estimated forfeitures of options | $ 2,800,000 | |||||||
Performance Shares, RSUs, Restricted Stock and Share Units | ||||||||
Awards (in Shares) | ||||||||
Outstanding, Beginning Balance (in shares) | shares | 903,225 | 931,192 | 933,555 | 954,676 | 954,676 | |||
Granted (in shares) | shares | 5,064 | 219,425 | ||||||
Settled (in shares) | shares | (3,884) | (527) | (199,466) | |||||
Forfeited (in shares) | shares | (29,147) | (1,836) | (41,080) | |||||
Outstanding, Ending Balance (in shares) | shares | 903,225 | 931,192 | 933,555 | 903,225 | ||||
Vested, Ending Balance (in shares) | shares | 326,186 | 326,186 | ||||||
Vested and Expected to Vest, Ending Balance (in shares) | shares | 860,595 | 860,595 | ||||||
Weighted Average Grant Date Fair Value | ||||||||
Outstanding, Beginning Balance (in dollars per share) | $ / shares | $ 24.96 | $ 24.92 | $ 24.91 | $ 22.40 | $ 22.40 | |||
Granted (in dollars per share) | $ / shares | 21.64 | 27.69 | ||||||
Settled (in dollars per share) | $ / shares | 23.26 | 11.40 | 16.80 | |||||
Forfeited (in dollars per share) | $ / shares | 23.40 | 23.95 | 21 | |||||
Outstanding, Ending Balance (in dollars per share) | $ / shares | 24.96 | $ 24.92 | $ 24.91 | 24.96 | ||||
Vested, Ending Balance (in dollars per share) | $ / shares | 24.93 | 24.93 | ||||||
Vested and Expected to Vest, Ending Balance (in dollars per share) | $ / shares | $ 25.12 | $ 25.12 | ||||||
Aggregate Intrinsic Value | ||||||||
Outstanding, Ending Balance | $ 16,719,000 | $ 16,719,000 | ||||||
Vested, Ending Balance | 6,038,000 | |||||||
Vested and Expected to Vest, Ending Balance | 15,930,000 | 15,930,000 | ||||||
Additional Disclosures | ||||||||
Total intrinsic value of stock-based awards settled | $ 70,000 | 28,000 | $ 5,895,000 | 4,252,000 | ||||
Performance Shares | Employees | Granted since fiscal 2014 | ||||||||
Additional Disclosures | ||||||||
Performance period | 3 years | |||||||
RSUs and restricted stock | Non-Employee Director | ||||||||
Additional Disclosures | ||||||||
Common Stock conversion ratio | 1 | 1 | ||||||
RSUs and restricted stock | Non-Employee Director | Granted prior to July 31, 2019 | ||||||||
Additional Disclosures | ||||||||
Vesting period | 3 years | |||||||
RSUs and restricted stock | Non-Employee Director | Granted after July 31, 2019 | ||||||||
Additional Disclosures | ||||||||
Vesting period | 5 years | |||||||
RSUs and restricted stock | Employees | ||||||||
Additional Disclosures | ||||||||
Vesting period | 5 years | |||||||
Common Stock conversion ratio | 1 | 1 | ||||||
Share units | ||||||||
Additional Disclosures | ||||||||
Common Stock conversion ratio | 1 | 1 | ||||||
Cumulative number of units settled as of the date (in shares) | shares | 431,142 | 431,142 | ||||||
Share units | Granted on or after July 31, 2017 | ||||||||
Additional Disclosures | ||||||||
Conversion period of fully-vested share units into Common Stock from grant date (in years) | 1 year | |||||||
Dividend Equivalents | ||||||||
Additional Disclosures | ||||||||
Accrual of dividend equivalents, net of reversal | $ 56,000 | $ 169,000 | ||||||
Dividend equivalents paid | 1,000 | 287,000 | ||||||
Carrying value at period end | 659,000 | 659,000 | $ 777,000 | |||||
Stock options | ||||||||
Additional Disclosures | ||||||||
Total intrinsic value of stock-based awards settled | $ 5,000 | $ 0 | $ 1,869,000 | $ 561,000 | ||||
Stock options | Subsequent Event | ||||||||
Additional Disclosures | ||||||||
Vesting period | 5 years | |||||||
Authorized for issuance (in shares) | shares | 342,300 | |||||||
Contractual life | 10 years |
Segment Information (Details)
Segment Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Apr. 30, 2020 | Apr. 30, 2019 | Apr. 30, 2020 | Apr. 30, 2019 | Jul. 31, 2019 | |
Segment Reporting Information [Line Items] | |||||
Net sales | $ 135,121,000 | $ 170,448,000 | $ 467,042,000 | $ 495,425,000 | |
Operating income (loss) | (3,136,000) | 11,296,000 | 12,358,000 | 31,002,000 | |
Net income (loss) | (3,989,000) | 7,612,000 | 5,894,000 | 18,906,000 | |
Provision for (benefit from) income taxes | (759,000) | 1,547,000 | 1,503,000 | 1,791,000 | |
Interest (income) and other expense | 108,000 | (22,000) | 37,000 | (7,000) | |
Write-off of deferred financing costs | 0 | 0 | 0 | 3,217,000 | |
Interest expense | 1,504,000 | 2,159,000 | 4,924,000 | 7,095,000 | |
Amortization of stock-based compensation | 981,000 | 1,119,000 | 3,098,000 | 3,356,000 | |
Amortization of intangibles | 5,517,000 | 4,536,000 | 15,952,000 | 13,113,000 | |
Depreciation | 2,650,000 | 2,918,000 | 8,022,000 | 8,618,000 | |
Estimated contract settlement costs | 476,000 | 2,465,000 | 444,000 | 6,351,000 | |
Settlement of intellectual property litigation | 0 | 0 | 0 | (3,204,000) | |
Acquisition plan expenses | 5,983,000 | 1,704,000 | 14,397,000 | 4,612,000 | |
Facility exit costs | 1,373,000 | ||||
Adjusted EBITDA | 12,471,000 | 24,038,000 | 54,271,000 | 65,221,000 | |
Purchases of property, plant and equipment | 1,912,000 | 2,207,000 | 4,420,000 | 6,388,000 | |
Long-lived assets acquired in connection with the acquisitions | 8,425,000 | 60,451,000 | 40,669,000 | 60,451,000 | |
Total assets | 951,732,000 | 903,487,000 | 951,732,000 | 903,487,000 | $ 887,711,000 |
Unallocated | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 0 | 0 | 0 | 0 | |
Operating income (loss) | (11,371,000) | (6,883,000) | (30,423,000) | (17,420,000) | |
Net income (loss) | (11,704,000) | (10,547,000) | (36,501,000) | (29,382,000) | |
Provision for (benefit from) income taxes | (1,175,000) | 1,537,000 | 1,186,000 | 1,726,000 | |
Interest (income) and other expense | 19,000 | (10,000) | 1,000 | (6,000) | |
Write-off of deferred financing costs | 3,217,000 | ||||
Interest expense | 1,489,000 | 2,137,000 | 4,891,000 | 7,025,000 | |
Amortization of stock-based compensation | 1,119,000 | 3,098,000 | 3,356,000 | ||
Amortization of intangibles | 0 | 0 | 0 | 0 | |
Depreciation | 210,000 | 177,000 | 578,000 | 607,000 | |
Estimated contract settlement costs | 0 | 0 | 0 | 0 | |
Settlement of intellectual property litigation | (3,204,000) | ||||
Acquisition plan expenses | 5,282,000 | 1,704,000 | 13,696,000 | 4,612,000 | |
Facility exit costs | 0 | ||||
Adjusted EBITDA | (4,898,000) | (3,883,000) | (13,051,000) | (12,049,000) | |
Purchases of property, plant and equipment | 118,000 | 181,000 | 286,000 | 438,000 | |
Long-lived assets acquired in connection with the acquisitions | 0 | 0 | 0 | 0 | |
Total assets | 52,538,000 | 37,546,000 | 52,538,000 | 37,546,000 | |
Commercial Solutions Segment | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 78,311,000 | 89,600,000 | 268,747,000 | 254,308,000 | |
Commercial Solutions Segment | Operating Segments | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 78,311,000 | 89,600,000 | 268,747,000 | 254,308,000 | |
Operating income (loss) | 4,041,000 | 8,126,000 | 26,501,000 | 23,942,000 | |
Net income (loss) | 3,462,000 | 8,086,000 | 26,031,000 | 23,783,000 | |
Provision for (benefit from) income taxes | 481,000 | 10,000 | 382,000 | 65,000 | |
Interest (income) and other expense | 89,000 | 9,000 | 62,000 | 32,000 | |
Write-off of deferred financing costs | 0 | ||||
Interest expense | 9,000 | 21,000 | 26,000 | 62,000 | |
Amortization of stock-based compensation | 0 | 0 | 0 | 0 | |
Amortization of intangibles | 4,313,000 | 3,692,000 | 13,037,000 | 10,581,000 | |
Depreciation | 1,993,000 | 2,374,000 | 6,372,000 | 6,898,000 | |
Estimated contract settlement costs | 476,000 | 2,465,000 | 444,000 | 6,351,000 | |
Settlement of intellectual property litigation | 0 | ||||
Acquisition plan expenses | 701,000 | 0 | 701,000 | 0 | |
Facility exit costs | 0 | ||||
Adjusted EBITDA | 11,524,000 | 16,657,000 | 47,055,000 | 47,772,000 | |
Purchases of property, plant and equipment | 1,263,000 | 1,730,000 | 3,178,000 | 4,593,000 | |
Long-lived assets acquired in connection with the acquisitions | 4,023,000 | 60,451,000 | 6,060,000 | 60,451,000 | |
Total assets | 663,455,000 | 665,499,000 | 663,455,000 | 665,499,000 | |
Commercial Solutions Segment | Intersegment Eliminations | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 3,115,000 | 1,413,000 | 6,876,000 | 14,515,000 | |
Government Solutions Segment | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 56,810,000 | 80,848,000 | 198,295,000 | 241,117,000 | |
Government Solutions Segment | Operating Segments | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 56,810,000 | 80,848,000 | 198,295,000 | 241,117,000 | |
Operating income (loss) | 4,194,000 | 10,053,000 | 16,280,000 | 24,480,000 | |
Net income (loss) | 4,253,000 | 10,073,000 | 16,364,000 | 24,505,000 | |
Provision for (benefit from) income taxes | (65,000) | 0 | (65,000) | 0 | |
Interest (income) and other expense | 0 | (21,000) | (26,000) | (33,000) | |
Write-off of deferred financing costs | 0 | ||||
Interest expense | 6,000 | 1,000 | 7,000 | 8,000 | |
Amortization of stock-based compensation | 0 | 0 | 0 | 0 | |
Amortization of intangibles | 1,204,000 | 844,000 | 2,915,000 | 2,532,000 | |
Depreciation | 447,000 | 367,000 | 1,072,000 | 1,113,000 | |
Estimated contract settlement costs | 0 | 0 | 0 | 0 | |
Settlement of intellectual property litigation | 0 | ||||
Acquisition plan expenses | 0 | 0 | 0 | 0 | |
Facility exit costs | 1,373,000 | ||||
Adjusted EBITDA | 5,845,000 | 11,264,000 | 20,267,000 | 29,498,000 | |
Purchases of property, plant and equipment | 531,000 | 296,000 | 956,000 | 1,357,000 | |
Long-lived assets acquired in connection with the acquisitions | 4,402,000 | 0 | 34,609,000 | 0 | |
Total assets | $ 235,739,000 | $ 200,442,000 | $ 235,739,000 | $ 200,442,000 |
Goodwill (Details)
Goodwill (Details) | Apr. 30, 2020USD ($)reporting_unit | Aug. 01, 2019USD ($)reporting_unit$ / shares | Apr. 30, 2020USD ($) | Apr. 30, 2020USD ($) |
Goodwill [Roll Forward] | ||||
Beginning balance | $ 310,489,000 | $ 310,489,000 | ||
Ending balance | $ 335,477,000 | $ 335,477,000 | 335,477,000 | |
Number of reporting units | reporting_unit | 2 | 2 | ||
Common Stock | ||||
Goodwill [Roll Forward] | ||||
Common stock price (in dollars per share) | $ / shares | $ 29.54 | |||
Solacom | ||||
Goodwill [Roll Forward] | ||||
Change resulting from acquisitions, adjustments | (420,000) | |||
GD NG-911 business | ||||
Goodwill [Roll Forward] | ||||
Change resulting from acquisitions | 4,556,000 | |||
CGC Technology | ||||
Goodwill [Roll Forward] | ||||
Beginning balance | 15,950,000 | |||
Change resulting from acquisitions, adjustments | 4,902,000 | |||
Change resulting from acquisitions | 20,852,000 | |||
Ending balance | $ 20,852,000 | 20,852,000 | 20,852,000 | |
Commercial Solutions Segment | ||||
Goodwill [Roll Forward] | ||||
Beginning balance | $ 251,296,000 | 251,296,000 | ||
Ending balance | 255,432,000 | 255,432,000 | 255,432,000 | |
Reporting unit, percentage of fair value in excess of carrying amount | 29.00% | |||
Commercial Solutions Segment | Solacom | ||||
Goodwill [Roll Forward] | ||||
Change resulting from acquisitions, adjustments | (420,000) | |||
Commercial Solutions Segment | GD NG-911 business | ||||
Goodwill [Roll Forward] | ||||
Change resulting from acquisitions | 4,556,000 | |||
Commercial Solutions Segment | CGC Technology | ||||
Goodwill [Roll Forward] | ||||
Change resulting from acquisitions | 0 | |||
Government Solutions Segment | ||||
Goodwill [Roll Forward] | ||||
Beginning balance | $ 59,193,000 | 59,193,000 | ||
Ending balance | $ 80,045,000 | $ 80,045,000 | 80,045,000 | |
Reporting unit, percentage of fair value in excess of carrying amount | 122.20% | |||
Government Solutions Segment | Solacom | ||||
Goodwill [Roll Forward] | ||||
Change resulting from acquisitions, adjustments | 0 | |||
Government Solutions Segment | GD NG-911 business | ||||
Goodwill [Roll Forward] | ||||
Change resulting from acquisitions | 0 | |||
Government Solutions Segment | CGC Technology | ||||
Goodwill [Roll Forward] | ||||
Change resulting from acquisitions | $ 20,852,000 |
Intangible Assets (Details)
Intangible Assets (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Apr. 30, 2020 | Apr. 30, 2019 | Apr. 30, 2020 | Apr. 30, 2019 | Jul. 31, 2019 | |
Finite-Lived Intangible Assets [Line Items] | |||||
Gross carrying amount | $ 414,733,000 | $ 414,733,000 | $ 400,509,000 | ||
Accumulated amortization | 154,571,000 | 154,571,000 | 138,619,000 | ||
Net carrying amount | 260,162,000 | 260,162,000 | $ 261,890,000 | ||
Amortization of intangibles | 5,517,000 | $ 4,536,000 | 15,952,000 | $ 13,113,000 | |
Amortization expense - year one | 21,445,000 | 21,445,000 | |||
Amortization expense - year two | 21,040,000 | 21,040,000 | |||
Amortization expense - year three | 19,458,000 | 19,458,000 | |||
Amortization expense - year four | 19,458,000 | 19,458,000 | |||
Amortization expense - year five | 18,766,000 | $ 18,766,000 | |||
Customer Relationships | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Weighted average amortization period | 20 years 5 months | 20 years 6 months | |||
Gross carrying amount | 284,558,000 | $ 284,558,000 | $ 276,834,000 | ||
Accumulated amortization | 76,205,000 | 76,205,000 | 66,484,000 | ||
Net carrying amount | 208,353,000 | $ 208,353,000 | $ 210,350,000 | ||
Technologies | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Weighted average amortization period | 13 years 8 months 12 days | 12 years 8 months 12 days | |||
Gross carrying amount | 97,649,000 | $ 97,649,000 | $ 92,649,000 | ||
Accumulated amortization | 63,866,000 | 63,866,000 | 59,522,000 | ||
Net carrying amount | 33,783,000 | $ 33,783,000 | $ 33,127,000 | ||
Trademarks and other | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Weighted average amortization period | 16 years 7 months 12 days | 16 years 8 months 12 days | |||
Gross carrying amount | 32,526,000 | $ 32,526,000 | $ 31,026,000 | ||
Accumulated amortization | 14,500,000 | 14,500,000 | 12,613,000 | ||
Net carrying amount | $ 18,026,000 | $ 18,026,000 | $ 18,413,000 |
Stockholders' Equity (Details)
Stockholders' Equity (Details) - USD ($) | Aug. 14, 2020 | Jun. 03, 2020 | May 15, 2020 | Mar. 04, 2020 | Feb. 14, 2020 | Dec. 04, 2019 | Nov. 15, 2019 | Sep. 24, 2019 | Apr. 30, 2020 | Apr. 30, 2019 | Apr. 30, 2020 | Apr. 30, 2019 | Dec. 06, 2018 |
Class of Stock [Line Items] | |||||||||||||
Amount under shelf registration | $ 400,000,000 | ||||||||||||
Treasury Stock Transactions, Excluding Value of Shares Reissued [Abstract] | |||||||||||||
Stock repurchase program, remaining authorized repurchase amount | $ 8,664,000 | $ 8,664,000 | |||||||||||
Maximum amount authorized by the Board of Directors for repurchases of the Company's common stock | $ 100,000,000 | $ 100,000,000 | |||||||||||
Repurchases (in shares) | 0 | 0 | 0 | 0 | |||||||||
Dividends [Abstract] | |||||||||||||
Dividends, declared (in dollars per share) | $ 0.10 | $ 0.1 | $ 0.10 | $ 0.10 | $ 0.10 | $ 0.30 | $ 0.30 | ||||||
Dividends, cash paid (in dollars per share) | $ 0.10 | $ 0.10 | |||||||||||
Forecast | |||||||||||||
Dividends [Abstract] | |||||||||||||
Dividends, cash paid (in dollars per share) | $ 0.10 | ||||||||||||
Subsequent Event | |||||||||||||
Treasury Stock Transactions, Excluding Value of Shares Reissued [Abstract] | |||||||||||||
Stock repurchase program, remaining authorized repurchase amount | $ 8,664,000 | ||||||||||||
Dividends [Abstract] | |||||||||||||
Dividends, declared (in dollars per share) | $ 0.10 | ||||||||||||
Dividends, cash paid (in dollars per share) | $ 0.10 |
Legal Proceedings and Other M_2
Legal Proceedings and Other Matters Commitments and Contingencies (Details) - Other Matters | 1 Months Ended | |||
May 31, 2018USD ($) | May 31, 2018action | May 31, 2018transaction | Oct. 31, 2014USD ($) | |
Loss Contingencies [Line Items] | ||||
Sales value of equipment | $ 288,000 | |||
Approximate number of transactions audited by the Office of Export Enforcement relating to international shipments by Xicom Technologies, Inc. | transaction | 7,800 | |||
Number of transactions that may not have been fully in compliance with the Export Administrative Regulations, based on Company's self assessment of transactions audited | 6 | 6 | ||
Aggregated value of international shipments that may not have been fully in compliance with Export Administration Regulations (less than) | $ 100,000 |