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MarketScreener Homepage  >  Equities  >  Nasdaq  >  Copart, Inc.    CPRT

COPART, INC.

(CPRT)
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Copart : Reports Third Quarter Fiscal 2020 Financial Results

05/20/2020 | 05:56pm EST

Copart, Inc. (NASDAQ: CPRT) today reported financial results for the quarter ended April 30, 2020.

For the three months ended April 30, 2020, revenue, gross profit, and net income were $550.4 million, $242.6 million, and $147.5 million, respectively. These represent a decrease in revenue of $2.8 million, or 0.5%; a decrease in gross profit of $9.0 million, or 3.6%; and a decrease in net income of $45.3 million, or 23.5%, respectively, from the same period last year. Fully diluted earnings per share for the three months were $0.62 compared to $0.81 last year, a decrease of 23.5%.

For the nine months ended April 30, 2020, revenue, gross profit, and net income were $1.7 billion, $757.4 million, and $534.4 million, respectively. These represent an increase in revenue of $180.5 million, or 12.0%; an increase in gross profit of $101.6 million, or 15.5%; and an increase in net income of $96.2 million, or 21.9%, respectively, from the same period last year. Fully diluted earnings per share for the nine months were $2.24 compared to $1.82 last year, an increase of 23.1%.

Excluding the impact of discrete income tax items, disposal of non-operating assets, foreign currency-related gains and losses, certain income tax benefits and payroll taxes related to accounting for stock option exercises, and the effect on common equivalent shares from ASU 2016-09, non-GAAP fully diluted earnings per share for the three and nine months ended April 30, 2020 and 2019, were $0.58, $0.66, $1.88 and $1.64, respectively. 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 21, 2020, 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://stream.conferenceamerica.com/copart052120. A replay of the call will be available through July 20, 2020 by calling (877) 919-4059. Use confirmation code: 48213700.

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 cases, to end users. Copart sells vehicles on behalf of insurance companies, banks, finance companies, charities, fleet operators, dealers and also sells vehicles sourced from individual owners. With operations at over 200 locations in 11 countries, Copart has more than 150,000 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 discrete income tax items, disposal of non-operating assets, foreign currency-related gains and losses, certain income tax benefits and payroll taxes related to accounting for stock option exercises, and the effect on common equivalent shares from ASU 2016-09. 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, disposal of non-operating assets, foreign currency-related gains and losses, certain income tax benefits and payroll taxes related to accounting for stock option exercises, and the effect on common equivalent shares from ASU 2016-09.

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
April 30,

 

Nine Months Ended
April 30,

 

 

2020

 

2019

 

2020

 

2019

Service revenues and vehicle sales:

 

 

 

 

 

 

 

 

Service revenues

 

$

491,582

 

 

$

473,682

 

 

$

1,489,472

 

 

$

1,285,295

 

Vehicle sales

 

58,778

 

 

79,434

 

 

190,452

 

 

214,087

 

Total service revenues and vehicle sales

 

550,360

 

 

553,116

 

 

1,679,924

 

 

1,499,382

 

Operating expenses:

 

 

 

 

 

 

 

 

Yard operations

 

231,985

 

 

213,804

 

 

692,547

 

 

602,664

 

Cost of vehicle sales

 

53,987

 

 

70,984

 

 

170,651

 

 

189,952

 

Yard depreciation and amortization

 

20,333

 

 

15,398

 

 

55,384

 

 

47,422

 

Yard stock-based compensation

 

1,442

 

 

1,351

 

 

3,971

 

 

3,621

 

Gross profit

 

242,613

 

 

251,579

 

 

757,371

 

 

655,723

 

General and administrative

 

37,017

 

 

34,072

 

 

115,102

 

 

102,113

 

General and administrative depreciation and amortization

 

6,382

 

 

5,714

 

 

18,627

 

 

15,958

 

General and administrative stock-based compensation

 

4,113

 

 

4,299

 

 

13,258

 

 

13,979

 

Total operating expenses

 

355,259

 

 

345,622

 

 

1,069,540

 

 

975,709

 

Operating income

 

195,101

 

 

207,494

 

 

610,384

 

 

523,673

 

Other expense:

 

 

 

 

 

 

 

 

Interest expense, net

 

(5,578)

 

 

(5,084)

 

 

(14,068)

 

 

(13,330)

 

Other income, net

 

2,277

 

 

1,719

 

 

2,640

 

 

7,538

 

Total other expense

 

(3,301)

 

 

(3,365)

 

 

(11,428)

 

 

(5,792)

 

Income before income taxes

 

191,800

 

 

204,129

 

 

598,956

 

 

517,881

 

Income tax expense

 

44,313

 

 

11,388

 

 

64,582

 

 

79,684

 

Net income

 

$

147,487

 

 

$

192,741

 

 

$

534,374

 

 

$

438,197

 

 

 

 

 

 

 

 

 

 

Basic net income per common share

 

$

0.63

 

 

$

0.85

 

 

$

2.30

 

 

$

1.90

 

Weighted average common shares outstanding

 

234,133

 

 

227,984

 

 

232,647

 

 

230,922

 

 

 

 

 

 

 

 

 

 

Diluted net income per common share

 

$

0.62

 

 

$

0.81

 

 

$

2.24

 

 

$

1.82

 

Diluted weighted average common shares outstanding

 

238,591

 

 

237,892

 

 

238,564

 

 

241,158

 

Copart, Inc.

Consolidated Balance Sheets

(In thousands)

(Unaudited)

 

 

 

April 30, 2020

 

July 31, 2019

ASSETS

 

 

 

 

Current assets:

 

 

 

 

Cash and cash equivalents

 

$

306,387

 

 

$

186,319

 

Accounts receivable, net

 

346,244

 

 

367,265

 

Vehicle pooling costs

 

75,357

 

 

76,548

 

Inventories

 

19,809

 

 

20,941

 

Income taxes receivable

 

31,578

 

 

19,526

 

Prepaid expenses and other assets

 

14,777

 

 

16,568

 

Total current assets

 

794,152

 

 

687,167

 

Property and equipment, net

 

1,838,297

 

 

1,427,726

 

Operating lease right-of-use assets

 

106,634

 

 

 

Intangibles, net

 

48,671

 

 

55,156

 

Goodwill

 

338,039

 

 

333,321

 

Deferred income taxes

 

310

 

 

411

 

Other assets

 

35,480

 

 

43,836

 

Total assets

 

$

3,161,583

 

 

$

2,547,617

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

Current liabilities:

 

 

 

 

Accounts payable and accrued liabilities

 

$

250,841

 

 

$

270,918

 

Deferred revenue

 

7,884

 

 

6,466

 

Income taxes payable

 

905

 

 

3,482

 

Current portion of operating lease liabilities

 

23,395

 

 

 

Current portion of finance lease liabilities

 

3,543

 

 

1,138

 

Total current liabilities

 

286,568

 

 

282,004

 

Deferred income taxes

 

57,724

 

 

48,683

 

Income taxes payable

 

46,795

 

 

35,116

 

Operating lease liabilities, net of current portion

 

85,698

 

 

 

Long-term debt and finance lease liabilities, net of discount

 

403,653

 

 

400,091

 

Other liabilities

 

134

 

 

3,342

 

Total liabilities

 

880,572

 

 

769,236

 

Commitments and contingencies

 

 

 

 

Stockholders' equity:

 

 

 

 

Preferred stock

 

 

 

 

Common stock

 

23

 

 

23

 

Additional paid-in capital

 

646,331

 

 

572,559

 

Accumulated other comprehensive loss

 

(138,923)

 

 

(132,529)

 

Retained earnings

 

1,773,580

 

 

1,338,328

 

Total stockholders' equity

 

2,281,011

 

 

1,778,381

 

Total liabilities and stockholders' equity

 

$

3,161,583

 

 

$

2,547,617

 

Copart, Inc.

Consolidated Statements of Cash Flows

(In thousands)

(Unaudited)

 

 

 

Nine Months Ended April 30,

 

 

2020

 

2019

Cash flows from operating activities:

 

 

 

 

Net income

 

$

534,374

 

 

$

438,197

 

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

 

 

 

 

Depreciation and amortization, including debt cost

 

76,756

 

 

63,709

 

Allowance for doubtful accounts

 

1,332

 

 

341

 

Equity in losses (earnings) of unconsolidated affiliates

 

1,918

 

 

(1,852)

 

Stock-based compensation

 

17,229

 

 

17,600

 

Gain on sale of property and equipment

 

(1,745)

 

 

(3,753)

 

Deferred income taxes

 

9,265

 

 

14,583

 

Changes in operating assets and liabilities:

 

 

 

 

Accounts receivable

 

19,102

 

 

(69,920)

 

Vehicle pooling costs

 

661

 

 

(15,026)

 

Inventories

 

1,209

 

 

(5,721)

 

Prepaid expenses and other current and non-current assets

 

6,268

 

 

(8,605)

 

Operating lease right-of-use assets and lease liabilities

 

(221)

 

 

 

Accounts payable and accrued liabilities

 

(15,636)

 

 

17,747

 

Deferred revenue

 

1,365

 

 

3,512

 

Income taxes receivable

 

(12,076)

 

 

(3,578)

 

Income taxes payable

 

9,168

 

 

7,304

 

Other liabilities

 

1,999

 

 

(1,042)

 

Net cash provided by operating activities

 

650,968

 

 

453,496

 

 

 

 

 

 

Cash flows from investing activities:

 

 

 

 

Purchases of property and equipment, including acquisitions

 

(490,998)

 

 

(260,081)

 

Proceeds from sale of property and equipment

 

2,153

 

 

17,928

 

Net cash used in investing activities

 

(488,845)

 

 

(242,153)

 

 

 

 

 

 

Cash flows from financing activities:

 

 

 

 

Proceeds from the exercise of stock options

 

55,656

 

 

17,261

 

Proceeds from the issuance of Employee Stock Purchase Plan shares

 

3,955

 

 

3,501

 

Repurchases of common stock

 

 

 

(364,997)

 

Payments for employee stock-based tax withholdings

 

(102,191)

 

 

(45,594)

 

Net proceeds on revolving loan facility

 

 

 

7,000

 

Net cash used in financing activities

 

(42,580)

 

 

(382,829)

 

Effect of foreign currency translation

 

525

 

 

(208)

 

Net increase (decrease) in cash and cash equivalents

 

120,068

 

 

(171,694)

 

Cash and cash equivalents at beginning of period

 

186,319

 

 

274,520

 

Cash and cash equivalents at end of period

 

$

306,387

 

 

$

102,826

 

Supplemental disclosure of cash flow information:

 

 

 

 

Interest paid

 

$

14,514

 

 

$

14,700

 

Income taxes paid, net of refunds

 

$

59,302

 

 

$

60,926

 

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,

 

 

2020

 

2019

 

2020

 

2019

GAAP net income

 

$

147,487

 

 

$

192,741

 

 

$

534,374

 

 

$

438,197

 

Effect of discrete income tax items

 

 

 

(10,170)

 

 

(3,008)

 

 

(10,170)

 

Effect of disposal of non-operating assets, net of tax

 

 

 

 

 

 

 

(1,598)

 

Effect of foreign currency-related (gains) losses, net of tax

 

(490)

 

 

94

 

 

(1,169)

 

 

(304)

 

Effect of recognizing tax benefit on exercise of employee stock options

 

(8,768)

 

 

(29,074)

 

 

(85,962)

 

 

(34,096)

 

Effect of payroll taxes on certain executive stock compensation, net of tax

 

 

 

1,295

 

 

2,867

 

 

1,295

 

Non-GAAP net income

 

$

138,229

 

 

$

154,886

 

 

$

447,102

 

 

$

393,324

 

 

 

 

 

 

 

 

 

 

GAAP net income per diluted common share

 

$

0.62

 

 

$

0.81

 

 

$

2.24

 

 

$

1.82

 

Non-GAAP net income per diluted common share

 

$

0.58

 

 

$

0.66

 

 

$

1.88

 

 

$

1.64

 

 

 

 

 

 

 

 

 

 

GAAP diluted weighted average common shares outstanding

 

238,591

 

 

237,892

 

 

238,564

 

 

241,158

 

Effect on common equivalent shares from ASU 2016-09

 

(710)

 

 

(1,731)

 

 

(995)

 

 

(1,949)

 

Non-GAAP diluted weighted average common shares outstanding

 

237,881

 

 

236,161

 

 

237,569

 

 

239,209

 

 


© Business Wire 2020
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Financials (USD)
Sales 2021 2 470 M - -
Net income 2021 753 M - -
Net cash 2021 418 M - -
P/E ratio 2021 36,1x
Yield 2021 -
Capitalization 26 468 M 26 468 M -
EV / Sales 2021 10,5x
EV / Sales 2022 9,59x
Nbr of Employees 7 600
Free-Float 88,3%
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Technical analysis trends COPART, INC.
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TrendsNeutralBullishBullish
Income Statement Evolution
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Mean consensus OUTPERFORM
Number of Analysts 9
Average target price 124,14 $
Last Close Price 112,09 $
Spread / Highest target 20,4%
Spread / Average Target 10,8%
Spread / Lowest Target -3,65%
EPS Revisions
Managers
NameTitle
Aaron Jayson Adair Chief Executive Officer & Director
Jeffrey Liaw President
Willis J. Johnson Executive Chairman
Steve Powers Chief Operating Officer
John F. North Chief Financial Officer & Senior Vice President
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