DALLAS–()–Copart, Inc. (NASDAQ: CPRT) today reported financial results for the quarter ended January 31, 2023.

For the three months ended January 31, 2023, revenue, gross profit, and net income were $956.7 million, $426.5 million, and $293.7 million, respectively. These represent an increase in revenue of $89.3 million, or 10.3%; an increase in gross profit of $23.2 million, or 5.7%; and an increase in net income of $6.3 million, or 2.2%, respectively, from the same period last year. Fully diluted earnings per share for the three months were $0.61 compared to $0.60 last year, an increase of 1.7%.

For the six months ended January 31, 2023, revenue, gross profit, and net income were $1,850.1 million, $796.0 million, and $539.5 million, respectively. These represent an increase in revenue of $172.5 million, or 10.3%; an increase in gross profit of $7.6 million, or 1.0%; and a decrease in net income of $8.3 million, or (1.5)%, respectively, from the same period last year. Fully diluted earnings per share for the six months were $1.12 compared to $1.14 last year, a decrease of (1.8)%.

Excluding the impact of certain discrete income tax items and certain income tax benefits related to stock-based compensation, non-GAAP fully diluted earnings per share for the three months ended January 31, 2023 and 2022 were $0.61, and $0.55, respectively, which was an increase of 10.9%. Excluding the impact of certain discrete income tax items and certain income tax benefits related to stock-based compensation, non-GAAP fully diluted earnings per share for the six months ended January 31, 2023 and 2022, were $1.12, and $1.08, respectively, which was an increase of 3.7%. 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 Tuesday, February 21, 2023, 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 May 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.

Copart, Inc.

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 discrete income tax items and 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. 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

January 31,

 

Six Months Ended

January 31,

 

 

 

2023

 

 

 

2022

 

 

% Change

 

 

2023

 

 

 

2022

 

 

% Change

Service revenues and vehicle sales:

 

 

 

 

 

 

 

 

 

 

 

 

Service revenues

 

$

789,797

 

 

$

711,090

 

 

11.1

%

 

$

1,516,637

 

 

$

1,378,908

 

 

10.0

%

Vehicle sales

 

 

166,927

 

 

 

156,370

 

 

6.8

%

 

 

333,459

 

 

 

298,684

 

 

11.6

%

Total service revenues and vehicle sales

 

 

956,724

 

 

 

867,460

 

 

10.3

%

 

 

1,850,096

 

 

 

1,677,592

 

 

10.3

%

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Yard operations

 

 

340,085

 

 

 

294,098

 

 

15.6

%

 

 

677,057

 

 

 

565,374

 

 

19.8

%

Cost of vehicle sales

 

 

154,727

 

 

 

140,304

 

 

10.3

%

 

 

305,839

 

 

 

266,712

 

 

14.7

%

Yard depreciation and amortization

 

 

34,070

 

 

 

28,301

 

 

20.4

%

 

 

68,430

 

 

 

54,738

 

 

25.0

%

Yard stock-based compensation

 

 

1,342

 

 

 

1,415

 

 

(5.2

)%

 

 

2,787

 

 

 

2,396

 

 

16.3

%

Gross profit

 

 

426,500

 

 

 

403,342

 

 

5.7

%

 

 

795,983

 

 

 

788,372

 

 

1.0

%

General and administrative

 

 

47,842

 

 

 

42,754

 

 

11.9

%

 

 

92,377

 

 

 

83,869

 

 

10.1

%

General and administrative depreciation and amortization

 

 

4,344

 

 

 

5,013

 

 

(13.3

)%

 

 

9,042

 

 

 

10,336

 

 

(12.5

)%

General and administrative stock-based compensation

 

 

8,789

 

 

 

8,247

 

 

6.6

%

 

 

17,536

 

 

 

16,718

 

 

4.9

%

Total operating expenses

 

 

591,199

 

 

 

520,132

 

 

13.7

%

 

 

1,173,068

 

 

 

1,000,143

 

 

17.3

%

Operating income

 

 

365,525

 

 

 

347,328

 

 

5.2

%

 

 

677,028

 

 

 

677,449

 

 

(0.1

)%

Other expense:

 

 

 

 

 

 

 

 

 

 

 

 

Interest income (expense), net

 

 

14,480

 

 

 

(4,433

)

 

(426.6

)%

 

 

18,902

 

 

 

(9,540

)

 

(298.1

)%

Other expense, net

 

 

(2,902

)

 

 

(840

)

 

245.5

%

 

 

(5,724

)

 

 

(28

)

 

20342.9

%

Total other income (expense)

 

 

11,578

 

 

 

(5,273

)

 

(319.6

)%

 

 

13,178

 

 

 

(9,568

)

 

237.7

%

Income before income taxes

 

 

377,103

 

 

 

342,055

 

 

10.2

%

 

 

690,206

 

 

 

667,881

 

 

3.3

%

Income tax expense

 

 

83,426

 

 

 

54,643

 

 

52.7

%

 

 

150,681

 

 

 

120,106

 

 

25.5

%

Net income

 

$

293,677

 

 

$

287,412

 

 

2.2

%

 

$

539,525

 

 

$

547,775

 

 

(1.5

)%

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic net income per common share

 

$

0.62

 

 

$

0.61

 

 

1.6

%

 

$

1.13

 

 

$

1.15

 

 

(1.7

)%

Weighted average common shares outstanding

 

 

476,376

 

 

 

474,372

 

 

0.4

%

 

 

476,237

 

 

 

474,334

 

 

0.4

%

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted net income per common share

 

$

0.61

 

 

$

0.60

 

 

1.7

%

 

$

1.12

 

 

$

1.14

 

 

(1.8

)%

Diluted weighted average common shares outstanding

 

 

482,536

 

 

 

482,374

 

 

%

 

 

482,238

 

 

 

482,488

 

 

(0.1

)%

 

Copart, Inc.

Consolidated Balance Sheets

(In thousands)

(Unaudited)

 

 

 

January 31, 2023

 

July 31, 2022

ASSETS

 

 

 

 

Current assets:

 

 

 

 

Cash, cash equivalents, and restricted cash

 

$

1,660,952

 

 

$

1,384,236

 

Accounts receivable, net

 

 

765,192

 

 

 

578,573

 

Vehicle pooling costs

 

 

133,598

 

 

 

112,242

 

Inventories

 

 

52,071

 

 

 

58,791

 

Income taxes receivable

 

 

436

 

 

 

49,882

 

Prepaid expenses and other assets

 

 

26,532

 

 

 

18,731

 

Total current assets

 

 

2,638,781

 

 

 

2,202,455

 

Property and equipment, net

 

 

2,656,273

 

 

 

2,485,764

 

Operating lease right-of-use assets

 

 

106,656

 

 

 

116,303

 

Intangibles, net

 

 

51,186

 

 

 

54,680

 

Goodwill

 

 

404,046

 

 

 

401,954

 

Other assets

 

 

75,466

 

 

 

47,708

 

Total assets

 

$

5,932,408

 

 

$

5,308,864

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

Current liabilities:

 

 

 

 

Accounts payable and accrued liabilities

 

$

439,271

 

 

$

399,034

 

Deferred revenue

 

 

23,796

 

 

 

20,061

 

Income taxes payable

 

 

3,820

 

 

 

 

Current portion of operating and finance lease liabilities

 

 

20,736

 

 

 

21,794

 

Total current liabilities

 

 

487,623

 

 

 

440,889

 

Deferred income taxes

 

 

76,471

 

 

 

80,060

 

Income taxes payable

 

 

65,322

 

 

 

64,637

 

Operating and finance lease liabilities, net of current portion

 

 

87,394

 

 

 

95,683

 

Long-term debt and other liabilities

 

 

1,946

 

 

 

1,996

 

Total liabilities

 

 

718,756

 

 

 

683,265

 

Commitments and contingencies

 

 

 

 

Stockholders’ equity:

 

 

 

 

Preferred stock

 

 

 

 

 

 

Common stock

 

 

48

 

 

 

48

 

Additional paid-in capital

 

 

875,009

 

 

 

838,508

 

Accumulated other comprehensive loss

 

 

(156,507

)

 

 

(169,365

)

Retained earnings

 

 

4,495,102

 

 

 

3,956,408

 

Total stockholders’ equity

 

 

5,213,652

 

 

 

4,625,599

 

Total liabilities and stockholders’ equity

 

$

5,932,408

 

 

$

5,308,864

 

 

Copart, Inc.

Consolidated Statements of Cash Flows

(In thousands)

(Unaudited)

 

 

 

Six Months Ended January 31,

 

 

 

2023

 

 

 

2022

 

Cash flows from operating activities:

 

 

 

 

Net income

 

$

539,525

 

 

$

547,775

 

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

 

Depreciation and amortization, including debt cost

 

 

78,094

 

 

 

65,627

 

Allowance for credit loss

 

 

2,133

 

 

 

1,695

 

Equity in losses of unconsolidated affiliates

 

 

4,030

 

 

 

685

 

Stock-based compensation

 

 

20,323

 

 

 

19,114

 

Gain on sale of property and equipment

 

 

(748

)

 

 

(755

)

Deferred income taxes

 

 

(3,309

)

 

 

6,003

 

Changes in operating assets and liabilities:

 

 

 

 

Accounts receivable

 

 

(186,559

)

 

 

(152,763

)

Vehicle pooling costs

 

 

(21,268

)

 

 

(29,623

)

Inventories

 

 

8,001

 

 

 

(8,589

)

Prepaid expenses, other current and non-current assets

 

 

(29,176

)

 

 

(19,889

)

Operating lease right-of-use assets and lease liabilities

 

 

414

 

 

 

657

 

Accounts payable, accrued liabilities and other liabilities

 

 

27,619

 

 

 

10,741

 

Deferred revenue

 

 

3,709

 

 

 

(309

)

Income taxes receivable

 

 

49,430

 

 

 

4,577

 

Income taxes payable

 

 

7,615

 

 

 

1,655

 

Other liabilities

 

 

 

 

 

(53

)

Net cash provided by operating activities

 

 

499,833

 

 

 

446,548

 

 

 

 

 

 

Cash flows from investing activities:

 

 

 

 

Purchases of property and equipment

 

 

(256,719

)

 

 

(156,200

)

Purchase of assets in connection with acquisitions

 

 

 

 

 

(469

)

Proceeds from sale of property and equipment

 

 

16,343

 

 

 

1,252

 

Purchase of held to maturity securities

 

 

 

 

 

(374,866

)

Investment in unconsolidated affiliate

 

 

(1,993

)

 

 

 

Net cash used in investing activities

 

 

(242,369

)

 

 

(530,283

)

 

 

 

 

 

Cash flows from financing activities:

 

 

 

 

Proceeds from the exercise of stock options

 

 

10,815

 

 

 

11,985

 

Proceeds from the issuance of Employee Stock Purchase Plan shares

 

 

5,363

 

 

 

5,022

 

Payments for employee stock-based tax withholdings

 

 

(831

)

 

 

(599

)

Payments of finance lease obligations

 

 

(13

)

 

 

(314

)

Net cash provided by financing activities

 

 

15,334

 

 

 

16,094

 

Effect of foreign currency translation

 

 

3,918

 

 

 

(8,968

)

Net increase (decrease) in cash, cash equivalents, and restricted cash

 

 

276,716

 

 

 

(76,609

)

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

 

$

1,660,952

 

 

$

971,651

 

Supplemental disclosure of cash flow information:

 

 

 

 

Interest paid

 

$

706

 

 

$

9,311

 

Income taxes paid, net of refunds

 

$

98,324

 

 

$

128,972

 

 

Copart, Inc.

Additional Financial Information

Reconciliation of GAAP to Non-GAAP Financial Measures

(In thousands, except per share amounts)

(Unaudited)

 

 

 

Three Months Ended

January 31,

 

Six Months Ended

January 31,

 

 

 

2023

 

 

 

2022

 

 

 

2023

 

 

 

2022

 

GAAP net income

 

$

293,677

 

 

$

287,412

 

 

$

539,525

 

 

$

547,775

 

Effect of certain discrete income tax items

 

 

 

 

 

(17,490

)

 

 

 

 

 

(17,490

)

Effect of recognizing tax benefit on exercise of stock-based compensation

 

 

(115

)

 

 

(3,965

)

 

 

(740

)

 

 

(6,952

)

Non-GAAP net income

 

$

293,562

 

 

$

265,957

 

 

$

538,785

 

 

$

523,333

 

 

 

 

 

 

 

 

 

 

GAAP net income per diluted common share

 

$

0.61

 

 

$

0.60

 

 

$

1.12

 

 

$

1.14

 

Non-GAAP net income per diluted common share

 

$

0.61

 

 

$

0.55

 

 

$

1.12

 

 

$

1.08

 

 

source