Copart, Inc. (NASDAQ: CPRT) today reported financial results for
the quarter and year ended July 31, 2022.
For the three months ended July 31, 2022, revenue, gross profit,
and net income were $883.4 million, $381.6 million, and $263.7
million, respectively. These represent an increase in revenue of
$134.8 million, or 18.0%; an increase in gross profit of $24.1
million, or 6.7%; and an increase in net income of $7.8 million, or
3.0%, respectively, from the same period last year. Fully diluted
earnings per share for the three months ended July 31, 2022 were
$1.10 compared to $1.06 last year, an increase of 3.8%.
For the year ended July 31, 2022, revenue, gross profit, and net
income were $3.5 billion, $1.6 billion, and $1.1 billion,
respectively. These represent an increase in revenue of $808.4
million, or 30.0%; an increase in gross profit of $263.1 million,
or 19.6%; and an increase in net income of $153.6 million, or
16.4%, respectively, from the same period last year. Fully diluted
earnings per share for the year ended July 31, 2022 were $4.52
compared to $3.90 last year, an increase of 15.9%.
Excluding the impact of acquisition related integration charges,
extinguishment of debt, and certain income tax benefits related to
stock-based compensation, non-GAAP fully diluted earnings per share
for the three months ended July 31, 2022 and 2021, were $1.13 and
$1.03, respectively, which was an increase of 9.7%. Excluding the
impact of certain discrete income tax items, acquisition related
integration charges, extinguishment of debt, certain legal matters,
and certain income tax benefits related to stock-based
compensation, non-GAAP fully diluted earnings per share for the
year ended July 31, 2022 and 2021, were $4.46 and $3.70,
respectively, which was an increase of 20.5%. 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, September 8, 2022, at 11:00 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 at
www.copart.com/investorrelations. A replay of the call will be
available through November 2022 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 170
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 discrete income tax items,
acquisition related integration charges, extinguishment of debt,
certain legal matters, 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, 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 July
31,
Twelve Months Ended
July 31,
2022
2021
% Change
2022
2021
% Change
Service revenues and vehicle sales:
Service revenues
$
707,816
$
620,048
14.2
%
$
2,853,040
$
2,291,867
24.5
%
Vehicle sales
175,572
128,582
36.5
%
647,881
400,644
61.7
%
Total service revenues and
vehicle sales
883,388
748,630
18.0
%
3,500,921
2,692,511
30.0
%
Operating expenses:
Yard operations
307,717
250,396
22.9
%
1,186,457
897,086
32.3
%
Cost of vehicle sales
161,255
113,641
41.9
%
585,203
346,128
69.1
%
Yard depreciation and
amortization
31,530
26,567
18.7
%
117,913
100,917
16.8
%
Yard stock-based
compensation
1,314
543
142.0
%
5,127
5,289
(3.1
) %
Gross profit
381,572
357,483
6.7
%
1,606,221
1,343,091
19.6
%
General and administrative
43,257
39,652
9.1
%
177,314
149,978
18.2
%
General and administrative
depreciation and amortization
4,803
3,097
55.1
%
20,072
21,054
(4.7
) %
General and administrative
stock-based compensation
8,719
13,234
(34.1
) %
33,838
35,633
(5.0
) %
Total operating expenses
558,595
447,130
24.9
%
2,125,924
1,556,085
36.6
%
Operating income
324,793
301,500
7.7
%
1,374,997
1,136,426
21.0
%
Other expense:
Interest expense, net
(2,656
)
(5,020
)
(47.1
) %
(16,688
)
(20,247
)
(17.6
) %
Loss on extinguishment of
debt
(16,759
)
—
100.0
%
(16,759
)
—
100.0
%
Other income, net
(1,910
)
2,564
(174.5
) %
(596
)
5,667
(110.5
) %
Total other expense
(21,325
)
(2,456
)
768.3
%
(34,043
)
(14,580
)
133.5
%
Income before income taxes
303,468
299,044
1.5
%
1,340,954
1,121,846
19.5
%
Income tax expense
39,733
43,070
(7.7
) %
250,824
185,351
35.3
%
Net income
$
263,735
$
255,974
3.0
%
$
1,090,130
$
936,495
16.4
%
Basic net income per common share
$
1.11
$
1.08
2.8
%
$
4.59
$
3.96
15.9
%
Weighted average common shares
outstanding
237,841
236,679
0.5
%
237,419
236,252
0.5
%
Diluted net income per common share
$
1.10
$
1.06
3.8
%
$
4.52
$
3.90
15.9
%
Diluted weighted average common shares
outstanding
240,736
240,714
—
%
241,151
240,290
0.4
%
Copart, Inc. Consolidated
Balance Sheets (In thousands) (Unaudited)
July 31, 2022
July 31, 2021
ASSETS
Current assets:
Cash, cash equivalents, and
restricted cash
$
1,384,236
$
1,048,260
Accounts receivable, net
578,573
480,628
Vehicle pooling costs
112,242
94,449
Inventories
58,791
44,968
Income taxes receivable
49,882
20,012
Prepaid expenses and other
assets
18,731
14,294
Total current assets
2,202,455
1,702,611
Property and equipment, net
2,485,764
2,296,624
Operating lease right-of-use assets
116,303
119,487
Intangibles, net
54,680
45,873
Goodwill
401,954
355,717
Other assets
47,708
41,831
Total assets
$
5,308,864
$
4,562,143
LIABILITIES AND STOCKHOLDERS’
EQUITY
Current liabilities:
Accounts payable and accrued
liabilities
$
399,034
$
369,826
Deferred revenue
20,061
20,973
Income taxes payable
—
7,760
Current portion of operating
and finance lease liabilities
21,794
22,472
Total current liabilities
440,889
421,031
Deferred income taxes
80,060
63,969
Income taxes payable
64,637
52,345
Operating and finance lease liabilities,
net of current portion
95,683
97,961
Long-term debt and other liabilities, net
of discount
1,996
397,636
Total liabilities
683,265
1,032,942
Commitments and contingencies
Stockholders’ equity:
Preferred stock
—
—
Common stock
24
24
Additional paid-in capital
838,532
761,834
Accumulated other comprehensive
loss
(169,365
)
(100,860
)
Retained earnings
3,956,408
2,868,203
Total stockholders’ equity
4,625,599
3,529,201
Total liabilities and
stockholders’ equity
$
5,308,864
$
4,562,143
Copart, Inc. Consolidated
Statements of Cash Flows (In thousands) (Unaudited)
Year Ended July 31,
2022
2021
Cash flows from operating
activities:
Net income
$
1,090,130
$
936,495
Adjustments to reconcile net
income to net cash provided by operating activities:
Depreciation and amortization,
including debt cost
138,605
123,084
Allowance for credit loss
1,349
(1,121
)
Equity in (earnings) losses of
unconsolidated affiliates
284
(3,240
)
Stock-based compensation
38,965
40,922
Gain on sale of property and
equipment
(939
)
(1,480
)
Loss on extinguishment of
debt
16,759
—
Deferred income taxes
17,017
(7,951
)
Changes in operating assets and
liabilities, net of effects from acquisitions:
Accounts receivable
(97,750
)
(127,513
)
Vehicle pooling costs
(18,342
)
(20,476
)
Inventories
(10,851
)
(24,602
)
Prepaid expenses and other
current and non-current assets
(5,156
)
7,025
Operating lease right-of-use
assets and lease liabilities
715
570
Accounts payable and accrued
liabilities
36,306
44,613
Deferred revenue
(574
)
8,781
Income taxes receivable
(29,884
)
6,739
Income taxes payable
49
9,045
Net cash provided by operating
activities
1,176,683
990,891
Cash flows from investing
activities:
Purchases of property and
equipment
(337,448
)
(462,996
)
Purchases of assets and
liabilities in connection with acquisitions, net of cash
acquired
(106,604
)
(5,000
)
Proceeds from sale of property
and equipment
4,333
2,530
Purchase of held to maturity
securities
(374,866
)
—
Proceeds from the sale of held
to maturity securities
374,866
—
Investment in unconsolidated
affiliate
(2,591
)
—
Net cash used in investing
activities
(442,310
)
(465,466
)
Cash flows from financing
activities:
Proceeds from the exercise of
stock options
28,108
39,049
Proceeds from the issuance of
Employee Stock Purchase Plan shares
9,625
9,136
Payments for employee
stock-based tax withholdings
(1,925
)
(6,145
)
Debt offering costs
(1,212
)
—
Principal payments on long-term
debt
(416,759
)
—
Payments of finance lease
obligations
(530
)
(1,118
)
Net cash (used in) provided by
financing activities
(382,693
)
40,922
Effect of foreign currency translation
(15,704
)
4,195
Net increase in cash, cash equivalents,
and restricted cash
335,976
570,542
Cash, cash equivalents, and restricted
cash at beginning of period
1,048,260
477,718
Cash, cash equivalents, and restricted
cash at end of period
$
1,384,236
$
1,048,260
Supplemental disclosure of cash flow
information:
Interest paid
$
18,539
$
19,723
Income taxes paid, net of
refunds
$
263,226
$
178,241
Copart, Inc. Additional
Financial Information Reconciliation of GAAP to Non-GAAP Financial
Measures (In thousands, except per share amounts)
(Unaudited)
Three Months Ended July
31,
Twelve Months Ended
July 31,
2022
2021
2022
2021
GAAP net income
$
263,735
$
255,974
$
1,090,130
$
936,495
Effect of certain discrete income tax
items
—
—
(17,490
)
(19,764
)
Effect of certain legal matters, net of
tax
—
—
5,092
—
Effect of extinguishment of debt, net of
tax
12,929
—
12,929
—
Effect of acquisition related integration
charges, net of tax
—
2,713
—
2,713
Effect of recognizing tax benefit on
exercise of stock-based compensation
(5,077
)
(10,962
)
(14,274
)
(29,812
)
Non-GAAP net income
$
271,587
$
247,725
$
1,076,387
$
889,632
GAAP net income per diluted common
share
$
1.10
$
1.06
$
4.52
$
3.90
Non-GAAP net income per diluted common
share
$
1.13
$
1.03
$
4.46
$
3.70
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220907006175/en/
Brooke Boston, Executive Assistant, Office of the Chief
Financial Officer brooke.boston@copart.com
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