Copart Reports Second Quarter Fiscal 2024 Financial Results
- Significant revenue growth of $63.4 million, representing a 6.6% increase year-over-year.
- Gross profit increased by $37.7 million, showing an 8.8% growth compared to the previous year.
- Net income attributable to Copart Inc. rose by $32.0 million, marking a 10.9% increase from the same period last year.
- Fully diluted earnings per share for the quarter were $0.33, a 10.0% increase from $0.30 in the previous year.
- For the six months ended January 31, 2024, Copart reported revenue of $2.04 billion, gross profit of $928.2 million, and net income of $658.2 million.
- The company achieved a 10.3% revenue increase, 16.6% gross profit increase, and 22.0% net income increase compared to the same period last year.
- Fully diluted earnings per share for the six months were $0.68, a 21.4% increase from $0.56 in the previous year.
- None.
Insights
The reported financial results by Copart, Inc. indicate a robust performance characterized by a consistent uptrend in revenue, gross profit and net income. The double-digit growth in net income of 10.9% and 22.0% for the quarter and six-month periods, respectively, is a strong signal of operational efficiency and market strength. This performance surpasses the typical single-digit growth rates often seen in mature industries. The earnings per share (EPS) increase of 10.0% and 21.4% for the respective periods underlines an enhanced shareholder value, which is a crucial metric for investor confidence.
One key aspect to consider is the scalability of Copart's business model, which seems to be effectively managing incremental costs, as evidenced by the higher growth rate in gross profit compared to revenue. This suggests a positive leverage effect, where the company's fixed costs are being spread over a larger revenue base, improving margins. Investors would be keen to understand the drivers behind this scalability, such as technological investments, operational efficiencies, or market expansion strategies.
The automotive salvage industry, where Copart operates, is influenced by factors such as the volume of total loss vehicles, the strength of the used vehicle market and insurance claim patterns. Copart's growth might reflect an increase in total loss frequency, possibly driven by factors like more complex and expensive vehicle repairs. Additionally, a robust used vehicle market can lead to higher demand for salvage auction services, as repairable vehicles and parts become more valuable.
It's also crucial to assess the competitive landscape. Copart's growth must be contextualized against industry peers to evaluate market share dynamics. If Copart is growing faster than the industry average, it could imply effective competitive strategies or a consolidation trend within the industry. Understanding these dynamics can help stakeholders anticipate future growth trajectories and potential market saturation points.
From an economic perspective, Copart's performance may act as an indicator of broader economic conditions. For instance, increased revenues might correlate with economic growth, leading to more vehicle purchases and, consequently, a higher incidence of vehicle accidents and insurance claims. However, it's also possible that during economic downturns, consumers and insurance companies opt for cheaper salvage parts, thus benefiting Copart's business model.
Another factor to consider is the potential impact of macroeconomic variables such as interest rates and inflation. These can affect consumer spending power and insurance rates, which in turn can influence Copart's revenue streams. The company's ability to maintain profitability amidst such economic fluctuations would be indicative of strong pricing power and operational resilience.
For the three months ended January 31, 2024, revenue, gross profit, and net income attributable to Copart Inc. were
For the six months ended January 31, 2024, revenue, gross profit, and net income attributable to Copart Inc. were
On Thursday, February 22, 2024, at 5:30 p.m. Eastern Time (4:30 p.m. Central 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 May 2024 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 platforms link sellers to more than 750,000 members in over 190 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 250 locations in 11 countries, Copart has more than 265,000 vehicles available online every day. Copart currently operates in
Cautionary Note About Forward-Looking Statements
This press release contains forward-looking statements within the meaning of federal securities laws. 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 January 31, |
|
Six Months Ended January 31, |
|||||||||||||||||||
|
|
|
2024 |
|
|
|
2023 |
|
|
% Change |
|
|
2024 |
|
|
|
2023 |
|
|
% Change |
||
Service revenues and vehicle sales: |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Service revenues |
|
$ |
861,745 |
|
|
$ |
789,797 |
|
|
9.1 |
% |
|
|
1,721,281 |
|
|
$ |
1,516,637 |
|
|
13.5 |
% |
Vehicle sales |
|
|
158,404 |
|
|
|
166,927 |
|
|
(5.1 |
)% |
|
|
319,284 |
|
|
|
333,459 |
|
|
(4.3 |
)% |
Total service revenues and vehicle sales |
|
|
1,020,149 |
|
|
|
956,724 |
|
|
6.6 |
% |
|
|
2,040,565 |
|
|
|
1,850,096 |
|
|
10.3 |
% |
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Yard operations |
|
|
366,342 |
|
|
|
340,085 |
|
|
7.7 |
% |
|
|
734,184 |
|
|
|
677,057 |
|
|
8.4 |
% |
Cost of vehicle sales |
|
|
146,819 |
|
|
|
154,727 |
|
|
(5.1 |
)% |
|
|
294,715 |
|
|
|
305,839 |
|
|
(3.6 |
)% |
Yard depreciation and amortization |
|
|
41,208 |
|
|
|
34,070 |
|
|
21.0 |
% |
|
|
80,311 |
|
|
|
68,430 |
|
|
17.4 |
% |
Yard stock-based compensation |
|
|
1,628 |
|
|
|
1,342 |
|
|
21.3 |
% |
|
|
3,184 |
|
|
|
2,787 |
|
|
14.2 |
% |
Gross profit |
|
|
464,152 |
|
|
|
426,500 |
|
|
8.8 |
% |
|
|
928,171 |
|
|
|
795,983 |
|
|
16.6 |
% |
General and administrative |
|
|
72,657 |
|
|
|
47,842 |
|
|
51.9 |
% |
|
|
130,288 |
|
|
|
92,377 |
|
|
41.0 |
% |
General and administrative depreciation and amortization |
|
|
4,054 |
|
|
|
4,344 |
|
|
(6.7 |
)% |
|
|
8,115 |
|
|
|
9,042 |
|
|
(10.3 |
)% |
General and administrative stock-based compensation |
|
|
7,541 |
|
|
|
8,789 |
|
|
(14.2 |
)% |
|
|
14,492 |
|
|
|
17,536 |
|
|
(17.4 |
)% |
Total operating expenses |
|
|
640,249 |
|
|
|
591,199 |
|
|
8.3 |
% |
|
|
1,265,289 |
|
|
|
1,173,068 |
|
|
7.9 |
% |
Operating income |
|
|
379,900 |
|
|
|
365,525 |
|
|
3.9 |
% |
|
|
775,276 |
|
|
|
677,028 |
|
|
14.5 |
% |
Other income (expense): |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest income, net |
|
|
33,956 |
|
|
|
14,480 |
|
|
134.5 |
% |
|
|
65,961 |
|
|
|
18,902 |
|
|
249.0 |
% |
Other expense, net |
|
|
(3,103 |
) |
|
|
(2,902 |
) |
|
6.9 |
% |
|
|
(7,175 |
) |
|
|
(5,724 |
) |
|
25.3 |
% |
Total other income |
|
|
30,853 |
|
|
|
11,578 |
|
|
166.5 |
% |
|
|
58,786 |
|
|
|
13,178 |
|
|
346.1 |
% |
Income before income taxes |
|
|
410,753 |
|
|
|
377,103 |
|
|
8.9 |
% |
|
|
834,062 |
|
|
|
690,206 |
|
|
20.8 |
% |
Income tax expense |
|
|
85,226 |
|
|
|
83,426 |
|
|
2.2 |
% |
|
|
176,003 |
|
|
|
150,681 |
|
|
16.8 |
% |
Net income |
|
|
325,527 |
|
|
|
293,677 |
|
|
10.8 |
% |
|
|
658,059 |
|
|
|
539,525 |
|
|
22.0 |
% |
Less: Net income/(loss) attributable to noncontrolling interest |
|
|
(108 |
) |
|
|
— |
|
|
100.0 |
% |
|
|
(103 |
) |
|
|
— |
|
|
100.0 |
% |
Net income attributable to Copart, Inc. |
|
$ |
325,635 |
|
|
$ |
293,677 |
|
|
10.9 |
% |
|
$ |
658,162 |
|
|
$ |
539,525 |
|
|
22.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic net income per common share |
|
$ |
0.34 |
|
|
$ |
0.31 |
|
|
9.7 |
% |
|
$ |
0.69 |
|
|
$ |
0.57 |
|
|
21.1 |
% |
Weighted average common shares outstanding |
|
|
960,525 |
|
|
|
952,752 |
|
|
0.8 |
% |
|
|
959,326 |
|
|
|
952,474 |
|
|
0.7 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Diluted net income per common share |
|
$ |
0.33 |
|
|
$ |
0.30 |
|
|
10.0 |
% |
|
$ |
0.68 |
|
|
$ |
0.56 |
|
|
21.4 |
% |
Diluted weighted average common shares outstanding |
|
|
974,589 |
|
|
|
965,072 |
|
|
1.0 |
% |
|
|
973,135 |
|
|
|
964,476 |
|
|
0.9 |
% |
Copart, Inc. |
||||||||
Consolidated Balance Sheets |
||||||||
(In thousands) |
||||||||
(Unaudited) |
||||||||
|
|
January 31, 2024 |
|
July 31, 2023 |
||||
ASSETS |
|
|
|
|
||||
Current assets: |
|
|
|
|
||||
Cash, cash equivalents, and restricted cash |
|
$ |
1,256,948 |
|
|
$ |
957,395 |
|
Investment in held to maturity securities |
|
|
1,411,122 |
|
|
|
1,406,589 |
|
Accounts receivable, net |
|
|
846,357 |
|
|
|
702,038 |
|
Vehicle pooling costs |
|
|
137,907 |
|
|
|
123,725 |
|
Inventories |
|
|
42,812 |
|
|
|
39,973 |
|
Income taxes receivable |
|
|
17,030 |
|
|
|
6,574 |
|
Prepaid expenses and other assets |
|
|
36,310 |
|
|
|
26,310 |
|
Total current assets |
|
|
3,748,486 |
|
|
|
3,262,604 |
|
Property and equipment, net |
|
|
3,042,711 |
|
|
|
2,844,339 |
|
Operating lease right-of-use assets |
|
|
112,838 |
|
|
|
108,139 |
|
Intangibles, net |
|
|
84,049 |
|
|
|
62,702 |
|
Goodwill |
|
|
510,563 |
|
|
|
394,289 |
|
Other assets |
|
|
99,873 |
|
|
|
65,806 |
|
Total assets |
|
$ |
7,598,520 |
|
|
$ |
6,737,879 |
|
|
|
|
|
|
||||
LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS AND STOCKHOLDERS’ EQUITY |
||||||||
Current liabilities: |
|
|
|
|
||||
Accounts payable and accrued liabilities |
|
$ |
473,856 |
|
|
$ |
440,810 |
|
Deferred revenue |
|
|
26,204 |
|
|
|
26,117 |
|
Income taxes payable |
|
|
4,740 |
|
|
|
4,374 |
|
Current portion of operating and finance lease liabilities |
|
|
21,223 |
|
|
|
21,468 |
|
Total current liabilities |
|
|
526,023 |
|
|
|
492,769 |
|
Deferred income taxes |
|
|
94,140 |
|
|
|
89,492 |
|
Income taxes payable |
|
|
71,314 |
|
|
|
69,193 |
|
Operating and finance lease liabilities, net of current portion |
|
|
93,876 |
|
|
|
88,082 |
|
Long-term debt and other liabilities |
|
|
453 |
|
|
|
10,903 |
|
Total liabilities |
|
|
785,806 |
|
|
|
750,439 |
|
Commitments and contingencies |
|
|
|
|
||||
Redeemable non-controlling interest |
|
|
25,114 |
|
|
|
— |
|
Stockholders' equity: |
|
|
|
|
||||
Preferred stock |
|
|
— |
|
|
|
— |
|
Common stock |
|
|
96 |
|
|
|
96 |
|
Additional paid-in capital |
|
|
1,087,345 |
|
|
|
938,910 |
|
Accumulated other comprehensive loss |
|
|
(145,279 |
) |
|
|
(141,006 |
) |
Retained earnings |
|
|
5,845,438 |
|
|
|
5,189,440 |
|
Total stockholders' equity |
|
|
6,787,600 |
|
|
|
5,987,440 |
|
Total liabilities, redeemable noncontrolling interests and stockholders’ equity |
|
$ |
7,598,520 |
|
|
$ |
6,737,879 |
|
Copart, Inc. |
||||||||
Consolidated Statements of Cash Flows |
||||||||
(In thousands) |
||||||||
(Unaudited) |
||||||||
|
|
Six Months Ended January 31, |
||||||
|
|
|
2024 |
|
|
|
2023 |
|
Cash flows from operating activities: |
|
|
|
|
||||
Net income |
|
$ |
658,059 |
|
|
$ |
539,525 |
|
Adjustments to reconcile net income to net cash provided by operating activities: |
|
|
|
|
||||
Depreciation and amortization, including debt cost |
|
|
88,485 |
|
|
|
78,094 |
|
Allowance for credit loss |
|
|
3,702 |
|
|
|
2,133 |
|
Equity in (earnings) losses of unconsolidated affiliates |
|
|
(5,402 |
) |
|
|
4,030 |
|
Stock-based compensation |
|
|
17,676 |
|
|
|
20,323 |
|
Gain on sale of property and equipment |
|
|
(971 |
) |
|
|
(748 |
) |
Deferred income taxes |
|
|
(2,103 |
) |
|
|
(3,309 |
) |
Changes in operating assets and liabilities: |
|
|
|
|
||||
Accounts receivable |
|
|
(169,508 |
) |
|
|
(186,559 |
) |
Vehicle pooling costs |
|
|
(14,387 |
) |
|
|
(21,268 |
) |
Inventories |
|
|
(2,994 |
) |
|
|
8,001 |
|
Prepaid expenses, other current and non-current assets |
|
|
(35,040 |
) |
|
|
(29,176 |
) |
Operating lease right-of-use assets and lease liabilities |
|
|
865 |
|
|
|
414 |
|
Accounts payable, accrued liabilities and other liabilities |
|
|
6,556 |
|
|
|
27,619 |
|
Deferred revenue |
|
|
(13 |
) |
|
|
3,709 |
|
Income taxes receivable |
|
|
(10,463 |
) |
|
|
49,430 |
|
Income taxes payable |
|
|
2,577 |
|
|
|
7,615 |
|
Net cash provided by operating activities |
|
|
537,039 |
|
|
|
499,833 |
|
|
|
|
|
|
||||
Cash flows from investing activities: |
|
|
|
|
||||
Purchases of property and equipment |
|
|
(285,289 |
) |
|
|
(256,719 |
) |
Cash acquired in connection with acquisition |
|
|
17,662 |
|
|
|
— |
|
Proceeds from sale of property and equipment |
|
|
2,069 |
|
|
|
16,343 |
|
Investment in held to maturity securities |
|
|
(1,411,122 |
) |
|
|
— |
|
Proceeds from the sale of held to maturity securities |
|
|
1,430,000 |
|
|
|
— |
|
Investment in unconsolidated affiliate |
|
|
(1,000 |
) |
|
|
(1,993 |
) |
Net cash used in investing activities |
|
|
(247,680 |
) |
|
|
(242,369 |
) |
|
|
|
|
|
||||
Cash flows from financing activities: |
|
|
|
|
||||
Proceeds from the exercise of stock options |
|
|
13,482 |
|
|
|
10,815 |
|
Proceeds from the issuance of Employee Stock Purchase Plan shares |
|
|
5,961 |
|
|
|
5,363 |
|
Payments for employee stock-based tax withholdings |
|
|
(2,164 |
) |
|
|
(831 |
) |
Principal payments on revolver facility |
|
|
(10,820 |
) |
|
|
— |
|
Payments of finance lease obligations |
|
|
(11 |
) |
|
|
(13 |
) |
Net cash provided by financing activities |
|
|
6,448 |
|
|
|
15,334 |
|
Effect of foreign currency translation |
|
|
3,746 |
|
|
|
3,918 |
|
Net increase in cash, cash equivalents, and restricted cash |
|
|
299,553 |
|
|
|
276,716 |
|
Cash, cash equivalents, and restricted cash at beginning of period |
|
|
957,395 |
|
|
|
1,384,236 |
|
Cash, cash equivalents, and restricted cash at end of period |
|
$ |
1,256,948 |
|
|
$ |
1,660,952 |
|
Supplemental disclosure of cash flow information: |
|
|
|
|
||||
Interest paid |
|
$ |
2,036 |
|
|
$ |
706 |
|
Income taxes paid, net of refunds |
|
$ |
188,480 |
|
|
$ |
98,324 |
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20240222913683/en/
Brooke
brooke.boston@copart.com
Source: Copart, Inc.
FAQ
What were Copart's (CPRT) revenue figures for the quarter ended January 31, 2024?
What was the gross profit for Copart (CPRT) in the same quarter?
What was Copart's (CPRT) net income for the quarter ended January 31, 2024?
How much did Copart's (CPRT) revenue increase by in the reported quarter?