Copart, Inc. (NASDAQ: CPRT) today reported financial results for
the quarter ended October 31, 2022.
For the three months ended October 31, 2022, revenue, gross
profit, and net income were $893.4 million, $369.5 million, and
$245.8 million, respectively. These represent an increase in
revenue of $83.2 million, or 10.3%; a decrease in gross profit of
$15.5 million, or 4.0%; and a decrease in net income of $14.5
million, or 5.6%, respectively, from the same period last year.
Fully diluted earnings per share for the three months were $0.51
compared to $0.54 last year, a decrease of 5.6%.
On September 28th, 2022, Hurricane Ian, a Category 4 hurricane,
came ashore in Florida, with sustained winds of 150mph, the first
such Category 4 storm to impact Southwest Florida since Hurricane
Charley in 2004. Hurricane Ian adversely impacted the operating
results for the three months ended October 31, 2022 resulting in
additional costs of approximately $25 million. These costs included
premiums for subhaulers, labor costs incurred from overtime, and
travel and lodging due to the reassignment of employees to the
affected region.
Excluding the impact of certain income tax benefits related to
stock-based compensation, non-GAAP fully diluted earnings per share
for the three months ended October 31, 2022 and 2021 were $0.51,
and $0.53, respectively, which was a decrease of 3.8%. A
reconciliation of non-GAAP financial measures to the most directly
comparable financial measures computed in accordance with U.S.
generally accepted accounting principles (GAAP) can be found in the
tables attached to this press release.
On Thursday, November 17, 2022, at 11 a.m. Eastern Time, Copart
will conduct a conference call to discuss the results for the
quarter. The call will be webcast live and can be accessed via
hyperlink at www.copart.com/investorrelations. A replay of the call
will be available through February 2023 by visiting
www.copart.com/investorrelations.
About Copart
Copart, Inc., founded in 1982, is a global leader in online
vehicle auctions. Copart’s innovative technology and online auction
platform links sellers to more than 750,000 members in over 190
countries. Copart offers services to process and sell vehicles to
dealers, dismantlers, rebuilders, exporters, and to the general
public. Copart sells vehicles on behalf of insurance companies,
banks, finance companies, charities, fleet operators, dealers,
vehicle rental companies, and individuals. With operations at over
200 locations in 11 countries, Copart has more than 250,000
vehicles available online every day. Copart currently operates in
the United States (Copart.com), Canada (Copart.ca), the United
Kingdom (Copart.co.uk), Brazil (Copart.com.br), the Republic of
Ireland (Copart.ie), Germany (Copart.de), Finland (Copart.fi), the
United Arab Emirates, Oman and Bahrain (Copartmea.com), and Spain
(Copart.es). For more information, or to become a Member, visit
Copart.com/Register.
Use of Non-GAAP Financial Measures
Included in this release are certain non-GAAP financial
measures, including non-GAAP net income per diluted share, which
exclude the impact of certain income tax benefits related to
stock-based compensation. These non-GAAP financial measures do not
represent alternative financial measures under GAAP. In addition,
these non-GAAP financial measures may be different from non-GAAP
financial measures used by other companies. Furthermore, these
non-GAAP financial measures do not reflect a comprehensive view of
Copart’s operations in accordance with GAAP and should only be read
in conjunction with the corresponding GAAP financial measures. This
information constitutes non-GAAP financial measures within the
meaning of Regulation G adopted by the U.S. Securities and Exchange
Commission. Accordingly, Copart has presented herein, and will
present in other information it publishes that contains these
non-GAAP financial measures, a reconciliation of these non-GAAP
financial measures to the most directly comparable GAAP financial
measures.
Copart believes the presentation of non-GAAP net income per
diluted share included in this release in conjunction with the
corresponding GAAP financial measures provides meaningful
information for investors, analysts and management in assessing
Copart’s business trends and financial performance.
Cautionary Note About Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of federal securities laws, including statements
concerning the potential impact of the COVID-19 pandemic on our
business, operations, and operating results. These forward-looking
statements are subject to substantial risks and uncertainties.
These forward-looking statements are subject to certain risks,
trends and uncertainties that could cause actual results to differ
materially from those projected or implied by our statements and
comments. For a more complete discussion of the risks that could
affect our business, please review the “Management’s Discussion and
Analysis” and the other risks identified in Copart’s latest Annual
Report on Form 10-K, Quarterly Reports on Form 10-Q, and Current
Reports on Form 8-K, as filed with the Securities and Exchange
Commission. We encourage investors to review these disclosures
carefully. We do not undertake to update any forward-looking
statement that may be made from time to time on our behalf.
Copart, Inc.
Consolidated Statements of
Income
(In thousands, except per share
amounts)
(Unaudited)
Three Months Ended
October 31,
2022
2021
% Change
Service revenues and vehicle sales:
Service revenues
$
726,840
$
667,818
8.8
%
Vehicle sales
166,532
142,314
17.0
%
Total service revenues and vehicle
sales
893,372
810,132
10.3
%
Operating expenses:
Yard operations
336,972
271,276
24.2
%
Cost of vehicle sales
151,112
126,408
19.5
%
Yard depreciation and amortization
34,360
26,437
30.0
%
Yard stock-based compensation
1,445
981
47.3
%
Gross profit
369,483
385,030
(4.0
) %
General and administrative
44,535
41,115
8.3
%
General and administrative depreciation
and amortization
4,698
5,323
(11.7
) %
General and administrative stock-based
compensation
8,747
8,471
3.3
%
Total operating expenses
581,869
480,011
21.2
%
Operating income
311,503
330,121
(5.6
) %
Other expense:
Interest income (expense), net
4,422
(5,107
)
186.6
%
Other (expense) income, net
(2,822
)
812
(447.5
) %
Total other income (expense)
1,600
(4,295
)
137.3
%
Income before income taxes
313,103
325,826
(3.9
) %
Income tax expense
67,255
65,463
2.7
%
Net income
$
245,848
$
260,363
(5.6
) %
Basic net income per common share
$
0.52
$
0.55
(5.5
) %
Weighted average common shares
outstanding
476,099
474,136
0.4
%
Diluted net income per common share
$
0.51
$
0.54
(5.6
) %
Diluted weighted average common shares
outstanding
482,168
482,442
(0.1
) %
Copart, Inc.
Consolidated Balance
Sheets
(In thousands)
(Unaudited)
October 31, 2022
July 31, 2022
ASSETS
Current assets:
Cash, cash equivalents, and restricted
cash
$
1,539,391
$
1,384,236
Accounts receivable, net
628,964
578,573
Vehicle pooling costs
116,526
112,242
Inventories
53,866
58,791
Income taxes receivable
5,261
49,882
Prepaid expenses and other assets
20,597
18,731
Total current assets
2,364,605
2,202,455
Property and equipment, net
2,582,481
2,485,764
Operating lease right-of-use assets
112,530
116,303
Intangibles, net
51,847
54,680
Goodwill
394,844
401,954
Other assets
87,370
47,708
Total assets
$
5,593,677
$
5,308,864
LIABILITIES AND STOCKHOLDERS’
EQUITY
Current liabilities:
Accounts payable and accrued
liabilities
$
446,974
$
399,034
Deferred revenue
19,319
20,061
Income taxes payable
16,101
—
Current portion of operating and finance
lease liabilities
22,083
21,794
Total current liabilities
504,477
440,889
Deferred income taxes
77,452
80,060
Income taxes payable
65,275
64,637
Operating and finance lease liabilities,
net of current portion
91,670
95,683
Long-term debt and other liabilities, net
of discount
1,969
1,996
Total liabilities
740,843
683,265
Commitments and contingencies
Stockholders' equity:
Preferred stock
—
—
Common stock
48
48
Additional paid-in capital
849,761
838,508
Accumulated other comprehensive loss
(198,936
)
(169,365
)
Retained earnings
4,201,961
3,956,408
Total stockholders' equity
4,852,834
4,625,599
Total liabilities and stockholders'
equity
$
5,593,677
$
5,308,864
Copart, Inc.
Consolidated Statements of
Cash Flows
(In thousands)
(Unaudited)
Three Months Ended October
31,
2022
2021
Cash flows from operating
activities:
Net income
$
245,848
$
260,363
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization, including
debt cost
39,327
32,049
Allowance for credit loss
1,396
295
Equity in losses of unconsolidated
affiliates
2,122
168
Stock-based compensation
10,192
9,452
Gain on sale of property and equipment
(113
)
(440
)
Deferred income taxes
(1,780
)
8,319
Changes in operating assets and
liabilities:
Accounts receivable
(53,837
)
(82,676
)
Vehicle pooling costs
(4,643
)
(21,697
)
Inventories
4,020
(3,463
)
Prepaid expenses, other current and
non-current assets
(35,303
)
3,071
Operating lease right-of-use assets and
lease liabilities
52
382
Accounts payable, accrued liabilities and
other liabilities
40,372
62,013
Deferred revenue
(588
)
(979
)
Income taxes receivable
44,595
19,479
Income taxes payable
19,899
26,204
Net cash provided by operating
activities
311,559
312,540
Cash flows from investing
activities:
Purchases of property and equipment
(152,655
)
(64,696
)
Proceeds from sale of property and
equipment
185
813
Net cash used in investing activities
(152,470
)
(63,883
)
Cash flows from financing
activities:
Proceeds from the exercise of stock
options
1,061
5,572
Payments for employee stock-based tax
withholdings
(295
)
(249
)
Payments of finance lease obligations
(7
)
(157
)
Net cash provided by financing
activities
759
5,166
Effect of foreign currency translation
(4,693
)
(3,710
)
Net increase in cash, cash equivalents,
and restricted cash
155,155
250,113
Cash, cash equivalents, and restricted
cash at beginning of period
1,384,236
1,048,260
Cash, cash equivalents, and restricted
cash at end of period
$
1,539,391
$
1,298,373
Supplemental disclosure of cash flow
information:
Interest paid
$
64
$
5,080
Income taxes paid, net of refunds
$
5,700
$
10,089
Copart, Inc.
Additional Financial
Information
Reconciliation of GAAP to
Non-GAAP Financial Measures
(In thousands, except per share
amounts)
(Unaudited)
Three Months Ended
October 31,
2022
2021
GAAP net income
$
245,848
$
260,363
Effect of recognizing tax benefit on
exercise of stock-based compensation
(625
)
(2,987
)
Non-GAAP net income
$
245,223
$
257,376
GAAP net income per diluted common
share
$
0.51
$
0.54
Non-GAAP net income per diluted common
share
$
0.51
$
0.53
View source
version on businesswire.com: https://www.businesswire.com/news/home/20221116006057/en/
Brooke Boston, Executive Assistant, Office of the Co-Chief
Executive Officer brooke.boston@copart.com
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