Copart Reports Second Quarter Fiscal 2021 Financial Results
Dallas, Texas. (February 18, 2021) — Copart, Inc. (NASDAQ: CPRT) today reported financial results for the quarter ended January 31, 2021.
For the three months ended January 31, 2021, revenue, gross profit, and net income were $617.0 million, $307.5 million, and $193.4 million, respectively. These represent an increase in revenue of $41.9 million, or 7.3%; an increase in gross profit of $47.6 million, or 18.3%; and an increase in net income of $24.7 million, or 14.7%, respectively, from the same period last year. Fully diluted earnings per share for the three months were $0.81 compared to $0.71 last year, an increase of 14.1%.
For the six months ended January 31, 2021, revenue, gross profit, and net income were $1.2 billion, $604.3 million, and $393.7 million, respectively. These represent an increase in revenue of $80.4 million, or 7.1%; an increase in gross profit of $89.5 million, or 17.4%; and an increase in net income of $6.8 million, or 1.8%, respectively, from the same period last year. Fully diluted earnings per share for the six months were $1.64 compared to $1.62 last year, an increase of 1.2%.
Excluding the impact of discrete income tax items, foreign currency-related gains and losses, certain income tax benefits and payroll taxes related to accounting for stock option exercises, non-GAAP fully diluted earnings per share for the three months ended January 31, 2021 and 2020, were $0.80, and $0.64, respectively, which was an increase of 25.0%. Excluding the impact of discrete income tax items, foreign currency-related gains and losses, certain income tax benefits and payroll taxes related to accounting for stock option exercises, non-GAAP fully diluted earnings per share for the six months ended January 31, 2021 and 2020, were $1.58, and $1.29, respectively, which was an increase of 22.5%. 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 Friday, February 19, 2021, 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 at http://public.viavid.com/index.php?id=143555 or via hyperlink at www.copart.com/investorrelations. A replay of the call will be available through May 2021 by visiting www.copart.com/investorrelations or http://public.viavid.com/index.php?id=143555.
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 salvage and clean title vehicles to dealers, dismantlers, rebuilders, exporters, and in some jurisdictions, to the general public. Copart sells vehicles on behalf of insurance companies, banks, finance companies, charities, fleet operators, dealers and individuals. With operations at over 200 locations in 11 countries, Copart has more than 175,000 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.
- 1 -
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 discrete income tax items, foreign currency-related gains and losses, certain income tax benefits and payroll taxes related to accounting for stock option exercises. 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. From a financial planning and analysis perspective, Copart management analyzes its operating results with and without the impact of discrete income tax items, foreign currency-related gains and losses, certain income tax benefits and payroll taxes related to accounting for stock option exercises.
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:
Melissa Hunter, Executive Support Manager, Office of the Chief Financial Officer
972-391-5090 or melissa.hunter@copart.com
- 2 -
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 January 31,
Six Months Ended January 31,
2021
2020
2021
2020
Service revenues and vehicle sales:
Service revenues
$
532,601
$
510,034
$
1,047,973
$
997,890
Vehicle sales
84,430
65,106
161,998
131,674
Total service revenues and vehicle sales
617,031
575,140
1,209,971
1,129,564
Operating expenses:
Yard operations
208,910
237,683
415,896
460,562
Cost of vehicle sales
73,629
57,900
137,989
116,664
Yard depreciation and amortization
25,180
18,231
48,474
35,051
Yard stock-based compensation
1,814
1,437
3,345
2,529
Gross profit
307,498
259,889
604,267
514,758
General and administrative
36,014
39,242
71,152
78,085
General and administrative depreciation and amortization
6,212
6,051
11,867
12,245
General and administrative stock-based compensation
7,051
4,704
14,433
9,145
Total operating expenses
358,810
365,248
703,156
714,281
Operating income
258,221
209,892
506,815
415,283
Other expense:
Interest expense, net
(4,849)
(4,464)
(9,881)
(8,490)
Other income, net
(920)
(354)
2,333
363
Total other expense
(5,769)
(4,818)
(7,548)
(8,127)
Income before income taxes
252,452
205,074
499,267
407,156
Income tax expense
59,012
36,367
105,542
20,269
Net income
$
193,440
$
168,707
$
393,725
$
386,887
Basic net income per common share
$
0.82
$
0.73
$
1.67
$
1.67
Weighted average common shares outstanding
236,152
232,671
235,971
231,920
Diluted net income per common share
$
0.81
$
0.71
$
1.64
$
1.62
Diluted weighted average common shares outstanding
240,280
238,470
240,124
238,566
- 3 -
Copart, Inc. ~ 14185 Dallas Parkway, Suite 300, Dallas TX 75254 ~ (972) 391-5000
Copart, Inc.
Consolidated Balance Sheets
(In thousands)
(Unaudited)
January 31, 2021
July 31, 2020
ASSETS
Current assets:
Cash, cash equivalents, and restricted cash
$
616,403
$
477,718
Accounts receivable, net
462,405
350,207
Vehicle pooling costs
92,928
73,684
Inventories
30,203
20,080
Income taxes receivable
6,498
26,740
Prepaid expenses and other assets
17,030
15,330
Total current assets
1,225,467
963,759
Property and equipment, net
2,175,346
1,941,719
Operating lease right-of-use assets
107,602
118,455
Intangibles, net
44,270
47,772
Goodwill
346,966
343,622
Deferred income taxes
221
213
Other assets
34,566
39,721
Total assets
$
3,934,438
$
3,455,261
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable and accrued liabilities
$
324,108
$
318,530
Deferred revenue
14,431
8,233
Income taxes payable
8,672
3,709
Current portion of operating lease liabilities
22,554
24,821
Current portion of finance lease liabilities
1,250
751
Total current liabilities
371,015
356,044
Deferred income taxes
81,316
71,686
Income taxes payable
51,177
44,965
Operating lease liabilities, net of current portion
85,307
95,584
Long-term debt and finance lease liabilities, net of discount
402,703
397,036
Other liabilities
328
430
Total liabilities
991,846
965,745
Commitments and contingencies
Stockholders' equity:
Preferred stock
—
—
Common stock
24
24
Additional paid-in capital
718,497
672,727
Accumulated other comprehensive loss
(106,720)
(121,088)
Retained earnings
2,330,791
1,937,853
Total stockholders' equity
2,942,592
2,489,516
Total liabilities and stockholders' equity
$
3,934,438
$
3,455,261
- 4 -
Copart, Inc. ~ 14185 Dallas Parkway, Suite 300, Dallas TX 75254 ~ (972) 391-5000
Copart, Inc.
Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
Six Months Ended January 31,
2021
2020
Cash flows from operating activities:
Net income
$
393,725
$
386,887
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization, including debt cost
60,898
48,097
Allowance for credit loss
213
1,301
Equity in (earnings) losses of unconsolidated affiliates
(1,343)
3,124
Stock-based compensation
17,778
11,674
Gain on sale of property and equipment
(1,145)
(1,315)
Deferred income taxes
9,442
6,719
Changes in operating assets and liabilities:
Accounts receivable
(111,148)
(78,510)
Vehicle pooling costs
(19,099)
(13,921)
Inventories
(9,772)
2,765
Prepaid expenses and other current and non-current assets
5,802
7,184
Operating lease right-of-use assets and lease liabilities
470
331
Accounts payable and accrued liabilities
10,041
24,862
Deferred revenue
6,098
1,021
Income taxes receivable
20,243
(48,722)
Income taxes payable
10,838
5,794
Other liabilities
—
(371)
Net cash provided by operating activities
393,041
356,920
Cash flows from investing activities:
Purchases of property and equipment, including acquisitions
(283,214)
(400,352)
Proceeds from sale of property and equipment
129
1,639
Net cash used in investing activities
(283,085)
(398,713)
Cash flows from financing activities:
Proceeds from the exercise of stock options
23,112
32,594
Proceeds from the issuance of Employee Stock Purchase Plan shares
4,880
3,955
Payments for employee stock-based tax withholdings
(787)
(101,422)
Net proceeds on revolving loan facility
—
13,600
Payments of finance lease obligations
(622)
—
Net cash provided by (used in) financing activities
26,583
(51,273)
Effect of foreign currency translation
2,146
258
Net increase (decrease) in cash, cash equivalents, and restricted cash
138,685
(92,808)
Cash, cash equivalents, and restricted cash at beginning of period
477,718
186,319
Cash, cash equivalents, and restricted cash at end of period
$
616,403
$
93,511
Supplemental disclosure of cash flow information:
Interest paid
$
7,614
$
9,007
Income taxes paid, net of refunds
$
64,860
$
57,591
- 5 -
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 January 31,
Six Months Ended January 31,
2021
2020
2021
2020
GAAP net income
$
193,440
$
168,707
$
393,725
$
386,887
Effect of discrete income tax items
—
—
—
(3,008)
Effect of foreign currency-related losses (gains), net of tax
238
(416)
48
(679)
Effect of recognizing tax benefit on exercise of employee stock options
(2,167)
(14,829)
(13,939)
(77,194)
Effect of payroll taxes on certain executive stock compensation, net of tax
—
—
—
2,867
Non-GAAP net income
$
191,511
$
153,462
$
379,834
$
308,873
GAAP net income per diluted common share
$
0.81
$
0.71
$
1.64
$
1.62
Non-GAAP net income per diluted common share
$
0.80
$
0.64
$
1.58
$
1.29
- 6 -
Copart, Inc. ~ 14185 Dallas Parkway, Suite 300, Dallas TX 75254 ~ (972) 391-5000
