[May 24, 2017] |
|
Copart Reports Third Quarter Fiscal 2017 Financial Results
Copart, Inc. (NASDAQ: CPRT) today reported financial results for the
quarter ended April 30, 2017.
For the three months ended April 30, 2017, revenue, gross margin, and
net income were $373.9 million, $172.5 million, and $90.5 million,
respectively. These represent an increase in revenue of $26.6 million,
or 7.7%; an increase in gross margin of $14.9 million, or 9.4%; and an
increase in net income of $15.9 million, or 21.3%, respectively, from
the same quarter last year. Fully diluted earnings per share for the
three months were $0.38 compared to $0.32 last year, an increase of
18.8%.
For the nine months ended April 30, 2017, revenue, gross margin, and net
income were $1.1 billion, $464.6 million, and $323.9 million,
respectively. These represent an increase in revenue of $133.6 million,
or 14.3%; an increase in gross margin of $61.4 million, or 15.2%; and an
increase in net income of $137.7 million, or 73.9%, respectively, from
the same period last year. Fully diluted earnings per share for the nine
months were $1.37 compared to $0.75 last year, an increase of 82.7%.
Excluding the impact of 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 April 30, 2017 and 2016, were $0.37 and $0.32,
respectively. Non-GAAP fully diluted earnings per share for the nine
months ended April 30, 2017 and 2016, were $0.94 and $0.74,
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 25, 2017, 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/copart052517.
A replay of the call will be available through July 24, 2017 by calling (877)
919-4059. Use confirmation code # 76132729.
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 vehicles
sourced from individual owners. With operations in over 200 locations in
11 countries, Copart has more than 125,000 vehicles available online
every day. Copart currently operates in the United States (Copart.com),
Canada (Copart.ca),
the United Kingdom (Copart.co.uk),
the Republic of Ireland (Copart.ie),
Brazil (Copart.com.br),
Germany (Copart.de),
the United Arab Emirates, Oman and Bahrain (Copartmea.com),
India (Copart.in),
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 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 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, and 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.
|
Condensed Consolidated Statements of Income
|
(In thousands, except per share data)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended April 30,
|
|
|
Nine Months Ended April 30,
|
|
|
|
|
2017
|
|
|
2016
|
|
|
2017
|
|
|
2016
|
Service revenues and vehicle sales:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Service revenues
|
|
|
|
$
|
332,346
|
|
|
|
$
|
303,507
|
|
|
|
$
|
949,457
|
|
|
|
$
|
814,891
|
|
Vehicle sales
|
|
|
|
41,516
|
|
|
|
43,739
|
|
|
|
119,928
|
|
|
|
120,899
|
|
Total service revenues and vehicle sales
|
|
|
|
373,862
|
|
|
|
347,246
|
|
|
|
1,069,385
|
|
|
|
935,790
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Yard operations
|
|
|
|
155,793
|
|
|
|
142,802
|
|
|
|
471,711
|
|
|
|
401,721
|
|
Cost of vehicle sales
|
|
|
|
34,785
|
|
|
|
37,744
|
|
|
|
101,558
|
|
|
|
103,939
|
|
Yard depreciation and amortization
|
|
|
|
9,951
|
|
|
|
8,339
|
|
|
|
29,116
|
|
|
|
24,932
|
|
Yard stock-based payment compensation
|
|
|
|
828
|
|
|
|
714
|
|
|
|
2,437
|
|
|
|
2,076
|
|
Gross margin
|
|
|
|
172,505
|
|
|
|
157,647
|
|
|
|
464,563
|
|
|
|
403,122
|
|
General and administrative
|
|
|
|
28,280
|
|
|
|
27,360
|
|
|
|
86,879
|
|
|
|
78,447
|
|
General and administrative depreciation and amortization
|
|
|
|
3,257
|
|
|
|
4,019
|
|
|
|
14,016
|
|
|
|
10,638
|
|
General and administrative stock-based payment compensation
|
|
|
|
4,180
|
|
|
|
4,320
|
|
|
|
13,176
|
|
|
|
13,758
|
|
Total operating expenses
|
|
|
|
237,074
|
|
|
|
225,298
|
|
|
|
718,893
|
|
|
|
635,511
|
|
Operating income
|
|
|
|
136,788
|
|
|
|
121,948
|
|
|
|
350,492
|
|
|
|
300,279
|
|
Other (expense) income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense, net
|
|
|
|
(5,506
|
)
|
|
|
(5,419
|
)
|
|
|
(16,888
|
)
|
|
|
(15,900
|
)
|
Other (expense) income, net
|
|
|
|
(194
|
)
|
|
|
39
|
|
|
|
117
|
|
|
|
5,501
|
|
Total other expenses
|
|
|
|
(5,700
|
)
|
|
|
(5,380
|
)
|
|
|
(16,771
|
)
|
|
|
(10,399
|
)
|
Income before income taxes
|
|
|
|
131,088
|
|
|
|
116,568
|
|
|
|
333,721
|
|
|
|
289,880
|
|
Income tax expense
|
|
|
|
40,542
|
|
|
|
41,944
|
|
|
|
9,829
|
|
|
|
103,642
|
|
Net income
|
|
|
|
$
|
90,546
|
|
|
|
$
|
74,624
|
|
|
|
$
|
323,892
|
|
|
|
$
|
186,238
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic net income per common share
|
|
|
|
$
|
0.39
|
|
|
|
$
|
0.34
|
|
|
|
$
|
1.42
|
|
|
|
$
|
0.80
|
|
Weighted average common shares outstanding
|
|
|
|
229,920
|
|
|
|
221,088
|
|
|
|
228,146
|
|
|
|
234,142
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted net income per common share
|
|
|
|
$
|
0.38
|
|
|
|
$
|
0.32
|
|
|
|
$
|
1.37
|
|
|
|
$
|
0.75
|
|
Diluted weighted average common shares outstanding
|
|
|
|
237,135
|
|
|
|
236,412
|
|
|
|
236,808
|
|
|
|
248,780
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Copart, Inc.
|
Condensed Consolidated Balance Sheets
|
(In thousands)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
April 30, 2017
|
|
|
July 31, 2016
|
ASSETS
|
|
|
|
|
|
|
|
Current assets:
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
|
$
|
189,621
|
|
|
|
$
|
155,849
|
|
Accounts receivable, net
|
|
|
|
302,071
|
|
|
|
266,270
|
|
Vehicle pooling costs and inventories
|
|
|
|
41,061
|
|
|
|
38,987
|
|
Income taxes receivable
|
|
|
|
42,663
|
|
|
|
18,751
|
|
Deferred income taxes
|
|
|
|
191
|
|
|
|
1,444
|
|
Prepaid expenses and other assets
|
|
|
|
18,002
|
|
|
|
18,005
|
|
Total current assets
|
|
|
|
593,609
|
|
|
|
499,306
|
|
Property and equipment, net
|
|
|
|
913,303
|
|
|
|
816,791
|
|
Intangibles, net
|
|
|
|
7,624
|
|
|
|
11,761
|
|
Goodwill
|
|
|
|
258,634
|
|
|
|
260,198
|
|
Deferred income taxes
|
|
|
|
2,978
|
|
|
|
23,506
|
|
Other assets
|
|
|
|
35,538
|
|
|
|
38,258
|
|
Total assets
|
|
|
|
$
|
1,811,686
|
|
|
|
$
|
1,649,820
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY
|
|
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
|
|
Accounts payable and accrued liabilities
|
|
|
|
$
|
192,769
|
|
|
|
$
|
192,379
|
|
Deferred revenue
|
|
|
|
6,147
|
|
|
|
4,628
|
|
Income taxes payable
|
|
|
|
6,421
|
|
|
|
5,625
|
|
Current portion of revolving credit facility and capital lease
obligations
|
|
|
|
16,151
|
|
|
|
76,151
|
|
Total current liabilities
|
|
|
|
221,488
|
|
|
|
278,783
|
|
Deferred income taxes
|
|
|
|
3,773
|
|
|
|
3,816
|
|
Income taxes payable
|
|
|
|
26,772
|
|
|
|
25,641
|
|
Long-term debt, revolving loan facility and capital lease
obligations, net of discount
|
|
|
|
550,755
|
|
|
|
564,341
|
|
Other liabilities
|
|
|
|
2,569
|
|
|
|
2,783
|
|
Total liabilities
|
|
|
|
805,357
|
|
|
|
875,364
|
|
Commitments and contingencies
|
|
|
|
|
|
|
|
Stockholders' equity:
|
|
|
|
|
|
|
|
Preferred stock
|
|
|
|
-
|
|
|
|
-
|
|
Common stock
|
|
|
|
22
|
|
|
|
22
|
|
Additional paid-in capital
|
|
|
|
444,745
|
|
|
|
392,434
|
|
Accumulated other comprehensive loss
|
|
|
|
(114,268
|
)
|
|
|
(109,194
|
)
|
Retained earnings
|
|
|
|
675,830
|
|
|
|
491,194
|
|
Total stockholders' equity
|
|
|
|
1,006,329
|
|
|
|
774,456
|
|
Total liabilities and stockholders' equity
|
|
|
|
$
|
1,811,686
|
|
|
|
$
|
1,649,820
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Copart, Inc.
|
Condensed Consolidated Statements of Cash Flows
|
(In thousands)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
Nine Months Ended April 30,
|
|
|
|
|
2017
|
|
|
2016
|
Cash flows from operating activities:
|
|
|
|
|
|
|
|
Net income
|
|
|
|
$
|
323,892
|
|
|
|
$
|
186,238
|
|
Adjustments to reconcile net income to net cash provided by
operating activities:
|
|
|
|
|
|
|
|
Depreciation and amortization, including debt cost
|
|
|
|
43,951
|
|
|
|
35,900
|
|
Allowance for doubtful accounts
|
|
|
|
(542
|
)
|
|
|
1,227
|
|
Equity in losses of unconsolidated affiliates
|
|
|
|
584
|
|
|
|
768
|
|
Stock-based payment compensation
|
|
|
|
15,613
|
|
|
|
15,834
|
|
Gain on sale of property and equipment
|
|
|
|
(125
|
)
|
|
|
(188
|
)
|
Deferred income taxes
|
|
|
|
21,791
|
|
|
|
(325
|
)
|
Changes in operating assets and liabilities, net of effects from
acquisitions:
|
|
|
|
|
|
|
|
Accounts receivable
|
|
|
|
(35,668
|
)
|
|
|
(49,594
|
)
|
Vehicle pooling costs and inventories
|
|
|
|
(2,262
|
)
|
|
|
(8,121
|
)
|
Prepaid expenses and other current assets
|
|
|
|
1,440
|
|
|
|
293
|
|
Other assets
|
|
|
|
(1,185
|
)
|
|
|
3,206
|
|
Accounts payable and accrued liabilities
|
|
|
|
1,140
|
|
|
|
5,024
|
|
Deferred revenue
|
|
|
|
1,532
|
|
|
|
2,038
|
|
Income taxes receivable
|
|
|
|
(23,909
|
)
|
|
|
3,326
|
|
Income taxes payable
|
|
|
|
2,619
|
|
|
|
13,858
|
|
Other liabilities
|
|
|
|
(1,044
|
)
|
|
|
(1,138
|
)
|
Net cash provided by operating activities
|
|
|
|
347,827
|
|
|
|
208,346
|
|
|
|
|
|
|
|
|
|
Cash flows from investing activities:
|
|
|
|
|
|
|
|
Purchases of property and equipment, including acquisitions
|
|
|
|
(134,710
|
)
|
|
|
(143,833
|
)
|
Investment in unconsolidated affiliate
|
|
|
|
(3,566
|
)
|
|
|
-
|
|
Proceeds from sale of property and equipment
|
|
|
|
554
|
|
|
|
485
|
|
Purchases of marketable securities
|
|
|
|
-
|
|
|
|
(21,119
|
)
|
Proceeds from sale of marketable securities
|
|
|
|
-
|
|
|
|
21,498
|
|
Net cash used in investing activities
|
|
|
|
(137,722
|
)
|
|
|
(142,969
|
)
|
|
|
|
|
|
|
|
|
Cash flows from financing activities:
|
|
|
|
|
|
|
|
Proceeds from the exercise of stock options
|
|
|
|
30,171
|
|
|
|
4,989
|
|
Proceeds from the issuance of Employee Stock Purchase Plan shares
|
|
|
|
1,908
|
|
|
|
1,640
|
|
Repurchases of common stock
|
|
|
|
-
|
|
|
|
(442,855
|
)
|
Payments for employee stock-based tax withholdings
|
|
|
|
(134,638
|
)
|
|
|
-
|
|
Proceeds from the issuance of long-term debt, net of discount
|
|
|
|
-
|
|
|
|
93,468
|
|
Repayments on revolving loan facility, net of proceeds
|
|
|
|
(73,000
|
)
|
|
|
-
|
|
Debt offering costs
|
|
|
|
-
|
|
|
|
(165
|
)
|
Principal payments on long-term debt
|
|
|
|
-
|
|
|
|
(37,500
|
)
|
Net cash used in financing activities
|
|
|
|
(175,559
|
)
|
|
|
(380,423
|
)
|
Effect of foreign currency translation
|
|
|
|
(774
|
)
|
|
|
(3,313
|
)
|
Net increase (decrease) in cash and cash equivalents
|
|
|
|
33,772
|
|
|
|
(318,359
|
)
|
Cash and cash equivalents at beginning of period
|
|
|
|
155,849
|
|
|
|
456,012
|
|
Cash and cash equivalents at end of period
|
|
|
|
$
|
189,621
|
|
|
|
$
|
137,653
|
|
Supplemental disclosure of cash flow information:
|
|
|
|
|
|
|
|
Interest paid
|
|
|
|
$
|
17,681
|
|
|
|
$
|
16,996
|
|
Income taxes paid, net of refunds
|
|
|
|
$
|
9,452
|
|
|
|
$
|
86,243
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Additional Financial Information
|
Reconciliation of GAAP to Non-GAAP Financial Measures
|
(In thousands, except per share data)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended April 30,
|
|
|
Nine Months Ended April 30,
|
|
|
|
|
2017
|
|
|
2016
|
|
|
2017
|
|
|
2016
|
GAAP net income
|
|
|
|
$
|
90,546
|
|
|
|
$
|
74,624
|
|
|
|
$
|
323,892
|
|
|
|
$
|
186,238
|
|
Effect of foreign currency-related (gains) losses, net of tax
|
|
|
|
(167
|
)
|
|
|
467
|
|
|
|
(295
|
)
|
|
|
(3,584
|
)
|
Effect of income tax benefit of ASU 2016-09 adoption, net of tax (1)
|
|
|
|
(4,007
|
)
|
|
|
(608
|
)
|
|
|
(106,749
|
)
|
|
|
(847
|
)
|
Effect of payroll taxes on certain executive stock compensation, net
of tax
|
|
|
|
-
|
|
|
|
-
|
|
|
|
3,307
|
|
|
|
48
|
|
Non-GAAP net income
|
|
|
|
$
|
86,372
|
|
|
|
$
|
74,483
|
|
|
|
$
|
220,155
|
|
|
|
$
|
181,855
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP diluted net income per common share
|
|
|
|
$
|
0.38
|
|
|
|
$
|
0.32
|
|
|
|
$
|
1.37
|
|
|
|
$
|
0.75
|
|
Non-GAAP diluted net income per common share
|
|
|
|
$
|
0.37
|
|
|
|
$
|
0.32
|
|
|
|
$
|
0.94
|
|
|
|
$
|
0.74
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP diluted weighted average common shares outstanding
|
|
|
|
237,135
|
|
|
|
236,412
|
|
|
|
236,808
|
|
|
|
248,780
|
|
Effect on common equivalent shares from ASU 2016-09 adoption(1)
|
|
|
|
(1,692
|
)
|
|
|
(1,818
|
)
|
|
|
(2,065
|
)
|
|
|
(1,698
|
)
|
Non-GAAP diluted weighted average commons shares outstanding
|
|
|
|
235,443
|
|
|
|
234,594
|
|
|
|
234,743
|
|
|
|
247,082
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
|
|
In March 2016, the FASB issued ASU No. 2016-09, Improvements to
Employee Share-Based Payment Accounting. Under this standard,
all excess tax benefits and tax deficiencies related to exercises
of stock options are recognized as income tax expense or benefit
in the income statement as discrete items in the reporting period
in which they occur. Additionally, excess tax benefits are
classified as an operating activity on the consolidated statements
of cash flows. The Company early adopted ASU 2016-09 during the
fourth quarter of fiscal 2016 on a modified retrospective basis.
For a more complete discussion, please review the Company's Annual
Report on Form 10-K, filed with the Securities and Exchange
Commission on September 28, 2016.
|
View source version on businesswire.com: http://www.businesswire.com/news/home/20170524006303/en/
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