Copart Reports Third Quarter Fiscal 2022 Financial Results
Dallas, Texas May 18, 2022 — Copart, Inc. (NASDAQ: CPRT) today reported financial results for the quarter ended April 30, 2022.
For the three months ended April 30, 2022, revenue, gross profit, and net income were $939.9 million, $436.3 million, and $278.6 million, respectively. These represent an increase in revenue of $206.0 million, or 28.1%; an increase in gross profit of $54.9 million, or 14.4%; and a decrease in net income of $(8.2) million, or (2.9)%, respectively, from the same period last year. Fully diluted earnings per share for the three months were $1.16 compared to $1.19 last year, a decrease of (2.5)%.
For the nine months ended April 30, 2022, revenue, gross profit, and net income were $2,617.5 million, $1,224.6 million, and $826.4 million, respectively. These represent an increase in revenue of $673.7 million, or 34.7%; an increase in gross profit of $239.0 million, or 24.3%; and an increase in net income of $145.9 million, or 21.4%, respectively, from the same period last year. Fully diluted earnings per share for the nine months were $3.42 compared to $2.83 last year, an increase of 20.8%.
Excluding the impact of certain income tax benefits related to stock-based compensation and certain legal matters, non-GAAP fully diluted earnings per share for the three months ended April 30, 2022 and 2021 were $1.17, and $1.09, respectively, which was an increase of 7.3%. Excluding the impact of certain income tax benefits related to stock-based compensation, certain legal matters and discrete income tax items, non-GAAP fully diluted earnings per share for the nine months ended April 30, 2022 and 2021, were $3.34, and $2.68, respectively, which was an increase of 24.6%. 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, May 19, 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 August 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.
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Copart, Inc. ~ 14185 Dallas Parkway, Suite 300, Dallas TX 75254 ~ (972) 391-5000
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 income tax benefits related to stock-based compensation, certain legal matters and discrete income tax items. 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.
Contact:
Brooke Boston, Executive Assistant, Office of the Chief Financial Officer
brooke.boston@copart.com
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Copart, Inc. ~ 14185 Dallas Parkway, Suite 300, Dallas TX 75254 ~ (972) 391-5000
Copart, Inc.
Consolidated Statements of Income
(In thousands, except per share amounts)
(Unaudited)
Three Months Ended April 30,
Nine Months Ended April 30,
2022
2021
% Change
2022
2021
% Change
Service revenues and vehicle sales:
Service revenues
$
766,316
$
623,846
22.8
%
$
2,145,224
$
1,671,819
28.3
%
Vehicle sales
173,625
110,064
57.7
%
472,309
272,062
73.6
%
Total service revenues and vehicle sales
939,941
733,910
28.1
%
2,617,533
1,943,881
34.7
%
Operating expenses:
Yard operations
313,365
230,794
35.8
%
878,740
646,690
35.9
%
Cost of vehicle sales
157,236
94,498
66.4
%
423,948
232,487
82.4
%
Yard depreciation and amortization
31,646
25,876
22.3
%
86,383
74,350
16.2
%
Yard stock-based compensation
1,417
1,401
1.1
%
3,813
4,746
(19.7)
%
Gross profit
436,277
381,341
14.4
%
1,224,649
985,608
24.3
%
General and administrative
50,188
39,174
28.1
%
134,057
110,326
21.5
%
General and administrative depreciation and amortization
4,933
6,090
(19.0)
%
15,269
17,957
(15.0)
%
General and administrative stock-based compensation
8,401
7,966
5.5
%
25,119
22,399
12.1
%
Total operating expenses
567,186
405,799
39.8
%
1,567,329
1,108,955
41.3
%
Operating income
372,755
328,111
13.6
%
1,050,204
834,926
25.8
%
Other expense:
Interest expense, net
(4,492)
(5,346)
(16.0)
%
(14,032)
(15,227)
(7.8)
%
Other income, net
1,342
770
74.3
%
1,314
3,103
(57.7)
%
Total other expense
(3,150)
(4,576)
(31.2)
%
(12,718)
(12,124)
4.9
%
Income before income taxes
369,605
323,535
14.2
%
1,037,486
822,802
26.1
%
Income tax expense
90,985
36,739
147.7
%
211,091
142,281
48.4
%
Net income
$
278,620
$
286,796
(2.9)
%
$
826,395
$
680,521
21.4
%
Basic net income per common share
$
1.17
$
1.21
(3.3)
%
$
3.48
$
2.88
20.8
%
Weighted average common shares outstanding
237,505
236,396
0.5
%
237,277
236,110
0.5
%
Diluted net income per common share
$
1.16
$
1.19
(2.5)
%
$
3.42
$
2.83
20.8
%
Diluted weighted average common shares outstanding
240,724
240,208
0.2
%
241,288
240,149
0.5
%
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Copart, Inc. ~ 14185 Dallas Parkway, Suite 300, Dallas TX 75254 ~ (972) 391-5000
Copart, Inc.
Consolidated Balance Sheets
(In thousands)
(Unaudited)
April 30, 2022
July 31, 2021
ASSETS
Current assets:
Cash, cash equivalents, and restricted cash
$
1,454,818
$
1,048,260
Investment in held to maturity securities
224,889
—
Accounts receivable, net
585,914
480,628
Vehicle pooling costs
114,028
94,449
Inventories
56,988
44,968
Income taxes receivable
1,581
20,012
Prepaid expenses and other assets
19,208
14,294
Total current assets
2,457,426
1,702,611
Property and equipment, net
2,402,809
2,296,624
Operating lease right-of-use assets
121,006
119,487
Intangibles, net
40,854
45,873
Goodwill
348,000
355,717
Other assets
73,779
41,831
Total assets
$
5,443,874
$
4,562,143
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable and accrued liabilities
$
398,414
$
369,826
Deferred revenue
21,087
20,973
Income taxes payable
6,907
7,760
Current portion of operating and finance lease liabilities
22,687
22,472
Total current liabilities
449,095
421,031
Deferred income taxes
78,023
63,969
Income taxes payable
61,359
52,345
Operating and finance lease liabilities, net of current portion
99,610
97,961
Long-term debt and other liabilities, net of discount
402,733
397,636
Total liabilities
1,090,820
1,032,942
Commitments and contingencies
Stockholders' equity:
Preferred stock
—
—
Common stock
24
24
Additional paid-in capital
811,900
761,834
Accumulated other comprehensive loss
(152,596)
(100,860)
Retained earnings
3,693,726
2,868,203
Total stockholders' equity
4,353,054
3,529,201
Total liabilities and stockholders' equity
$
5,443,874
$
4,562,143
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Copart, Inc. ~ 14185 Dallas Parkway, Suite 300, Dallas TX 75254 ~ (972) 391-5000
Copart, Inc.
Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
Nine Months Ended April 30,
2022
2021
Cash flows from operating activities:
Net income
$
826,395
$
680,521
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization, including debt cost
102,333
93,141
Allowance for credit loss
1,456
(1,429)
Equity in losses (earnings) of unconsolidated affiliates
794
(2,121)
Stock-based compensation
28,932
27,145
Gain on sale of property and equipment
(1,280)
(1,257)
Deferred income taxes
14,582
(14,130)
Changes in operating assets and liabilities:
Accounts receivable
(109,636)
(81,593)
Vehicle pooling costs
(20,029)
(12,777)
Inventories
(13,367)
(18,788)
Prepaid expenses, other current and non-current assets
(37,842)
6,879
Operating lease right-of-use assets and lease liabilities
436
389
Accounts payable, accrued liabilities and other liabilities
45,745
47,914
Deferred revenue
388
8,467
Income taxes receivable
18,416
16,152
Income taxes payable
6,531
13,692
Net cash provided by operating activities
863,854
762,205
Cash flows from investing activities:
Purchases of property and equipment
(234,810)
(364,395)
Purchase of assets in connection with acquisitions
(493)
—
Proceeds from sale of property and equipment
2,622
599
Purchase of held to maturity securities
(374,866)
—
Proceeds from the sale of held to maturity securities
149,977
—
Net cash used in investing activities
(457,570)
(363,796)
Cash flows from financing activities:
Proceeds from the exercise of stock options
16,108
28,829
Proceeds from the issuance of Employee Stock Purchase Plan shares
5,026
4,880
Payments for employee stock-based tax withholdings
(872)
(938)
Debt offering costs
(1,212)
—
Payments of finance lease obligations
(472)
(962)
Net cash provided by financing activities
18,578
31,809
Effect of foreign currency translation
(18,304)
3,954
Net increase in cash, cash equivalents, and restricted cash
406,558
434,172
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
$
1,454,818
$
911,890
Supplemental disclosure of cash flow information:
Interest paid
$
14,485
$
14,736
Income taxes paid, net of refunds
$
195,521
$
126,303
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Copart, Inc. ~ 14185 Dallas Parkway, Suite 300, Dallas TX 75254 ~ (972) 391-5000
Copart, Inc.
Additional Financial Information
Reconciliation of GAAP to Non-GAAP Financial Measures
(In thousands, except per share amounts)
(Unaudited)
Three Months Ended April 30,
Nine Months Ended April 30,
2022
2021
2022
2021
GAAP net income
$
278,620
$
286,796
$
826,395
$
680,521
Effect of certain discrete income tax items
—
(19,764)
(17,490)
(19,764)
Effect of certain legal matters, net of tax
5,092
—
5,092
—
Effect of recognizing tax benefit on exercise of stock-based compensation
(2,244)
(4,910)
(9,197)
(18,850)
Non-GAAP net income
$
281,468
$
262,122
$
804,800
$
641,907
GAAP net income per diluted common share
$
1.16
$
1.19
$
3.42
$
2.83
Non-GAAP net income per diluted common share
$
1.17
$
1.09
$
3.34
$
2.68
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Copart, Inc. ~ 14185 Dallas Parkway, Suite 300, Dallas TX 75254 ~ (972) 391-5000
