CalAmp Corp. (NASDAQ:CAMP) Q2 2021 Earnings Conference Call - Final Transcript

Sep 24, 2020 • 04:30 pm ET


CalAmp Corp. (NASDAQ:CAMP) Q2 2021 Earnings Conference Call - Final Transcript


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Kurt Binder

an adjusted EBITDA margin of 6.5% compared to adjusted EBITDA of $6.5 million and an adjusted EBITDA margin of 8.1% in the prior quarter. The decrease in adjusted EBITDA was primarily due to the one-time charge for the product performance matter discussed earlier in addition to one time executive relocation expenses, collectively amounting to $1.7 million or 200 basis points of EBITDA margin.

Excluding these items, adjusted EBITDA would have improved in the quarter, reflecting the benefit of our cost containment measures. We continue to manage our spend carefully in this period of uncertainty and our focus has been on closely managing personnel costs including delayed hiring as well as the timing of discretionary spend around T&E, professional services and marketing among others. Our non-GAAP operating expenses as a percentage of revenue was approximately 37% for the current period. And we expect to manage our operating expense in line with consolidated revenue growth as we navigate through this period.

Now turning to our current liquidity position. At the end of the second quarter, we had total cash and cash equivalents of approximately $107 million compared to $104 million last quarter. Our aggregate outstanding debt is approximately $263 million including $230 million of the 2% convertible senior notes due August 2025. This is also the third consecutive quarter in which we generated solid free cash flow since acquiring three businesses in the past year to accelerate our move to a subscription-based business model.

CalAmp continues to maintain a strong financial position with additional capacity available on our revolver and sufficient cash for working capital going forward. In reference to our outlook for the third quarter and as mentioned in today's release, we are maintaining our policy of not providing quarterly guidance due to the ongoing uncertainty related to the pandemic and reduced visibility into customer demand and product shipment.

I do want to state that we are proceeding into the third quarter with solid demand in our SaaS business and we also expect another solid quarter from CAT as we continue to support their 3G to 4G transition. Together, we expect these factors will help to offset the normalization of installation backlog activity in the current quarter and the ongoing weakness in demand for our MRM Telematics products due to the pandemic.

With that, I'll turn the call back over to Jeff to provide some final comments before we open the call up for questions.

Jeff Gardner

Thank you, Kurt. In closing, I'm very pleased with our performance in the second quarter as the CalAmp team continues to execute on our strategic initiatives across the organization. I believe the success we continue to achieve in our SaaS business is an indication of the opportunities ahead of us as we transform our business toward becoming a leading SaaS, telematics solutions provider. We have an exceptional team in place to advance to the next level of growth and expansion.

With that, now I'd like to open the calls up to your questions. Operator?