COPART INC - FORM 8-K - EX-99.1 - EXHIBIT 99.1 - May 25, 2016

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Exhibit 99.1
Copart, Inc.
For Immediate Release
Copart Reports Third Quarter Fiscal 2016 Financial Results
Dallas, Texas. (May 25, 2016) — Copart, Inc. (NASDAQ: CPRT) today reported financial results for the quarter ended April 30, 2016.
For the three months ended April 30, 2016, revenue, gross margin, and net income were $347.2 million, $157.6 million, and $74.0 million, respectively. These represent an increase in revenue of $50.1 million, or 16.9%; an increase in gross margin of $30.2 million, or 23.7%; and an increase in net income of $16.5 million, or 28.6%, respectively, from the same quarter last year. Fully diluted earnings per share for the three months were $0.64 compared to $0.44 last year, an increase of 45.5%.
For the nine months ended April 30, 2016, revenue, gross margin, and net income were $935.8 million, $403.1 million and $185.4 million, respectively. These represent an increase in revenue of $72.0 million, or 8.3%; an increase in gross margin of $38.5 million, or 10.6%; and an increase in net income of $23.0 million, or 14.2%, respectively, from the same period last year. Fully diluted earnings per share for the nine months were $1.51 compared to $1.23 last year, an increase of 22.8%.
On Thursday, May 26, 2016, 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 at http://stream.conferenceamerica.com/copart05262016. A replay of the call will be available through July 25, 2016 by calling (877) 919-4059. Use confirmation code # 73323554.
About Copart
Copart, founded in 1982, provides vehicle sellers with a full range of remarketing services to process and sell salvage and clean title vehicles to dealers, dismantlers, rebuilders, exporters and, in some locations, to end users. Copart remarkets the vehicles through Internet sales utilizing its VB3 technology. Copart sells vehicles on behalf of insurance companies, banks, financial institutions, charities, car dealerships, fleet operators, vehicle rental companies, as well as cars sourced from the general public. The company currently operates in the United States and Canada (www.copart.com), the United Kingdom (www.copart.co.uk), Brazil (www.copart.com.br), Germany (www.copart.de), the United Arab Emirates, Oman and Bahrain (www.copartmea.com), Spain (www.autoresiduos.com), Ireland (www.copart.ie), and India (www.copart.in). Copart links sellers to more than 750,000 members in over 150 countries worldwide through its multi-channel platform. Copart was recently ranked at the top of Deloitte’s “Exceptional 100” list of companies, which reviewed U.S. publicly traded companies based upon a multidimensional approach to measuring financial performance. For more information, or to become a member, visit www.copart.com.


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Copart, Inc. ~ 14185 Dallas Parkway, Suite 300, Dallas TX 75254 ~ (972) 391-5000



Copart, Inc.
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.
Contact:       
Christopher M. Smith, Senior Analyst, Office of the Chief Financial Officer
 
972-391-5021 or christopher.smith3@copart.com



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Copart, Inc. ~ 14185 Dallas Parkway, Suite 300, Dallas TX 75254 ~ (972) 391-5000



Copart, Inc.
Condensed Consolidated Statements of Income
(In thousands, except per share data)
(Unaudited)
 
Three Months Ended 
 April 30,
 
Nine Months Ended 
 April 30,
 
2016
 
2015
 
2016
 
2015
Service revenues and vehicle sales:
 
 
 
 
 
 
 
Service revenues
$
303,507

 
$
256,564

 
$
814,891

 
$
741,692

Vehicle sales
43,739

 
40,578

 
120,899

 
122,094

Total service revenues and vehicle sales
347,246

 
297,142

 
935,790

 
863,786

Operating expenses:
 
 
 
 
   
 
 
Yard operations
142,802

 
125,348

 
401,721

 
367,124

Cost of vehicle sales
37,744

 
34,503

 
103,939

 
103,694

Yard depreciation and amortization
8,339

 
9,248

 
24,932

 
26,655

Yard stock-based payment compensation
714

 
626

 
2,076

 
1,721

Gross margin
157,647

 
127,417

 
403,122

 
364,592

General and administrative
27,360

 
25,940

 
78,447

 
86,741

General and administrative depreciation and amortization
4,019

 
2,916

 
10,638

 
8,646

General and administrative stock-based payment compensation
4,320

 
3,794

 
13,758

 
11,569

Total operating expenses
225,298

 
202,375

 
635,511

 
606,150

Operating income
121,948

 
94,767

 
300,279

 
257,636

Other (expense) income:
 
 
 
 
   
 
 
Interest expense, net
(5,419
)
 
(5,656
)
 
(15,900
)
 
(11,932
)
Other income, net
39

 
(815
)
 
5,501

 
4,919

Total other expenses
(5,380
)
 
(6,471
)
 
(10,399
)
 
(7,013
)
Income before income taxes
116,568

 
88,296

 
289,880

 
250,623

Income taxes
42,552

 
30,733

 
104,488

 
88,252

Net income
$
74,016

 
$
57,563

 
$
185,392

 
$
162,371

 
 
 
 
 
 
 
 
Basic net income per common share
$
0.67

 
$
0.46

 
$
1.58

 
$
1.29

Weighted average common shares outstanding
110,543

 
126,415

 
117,071

 
126,309

 
 
 
 
 
 
 
 
Diluted net income per common share
$
0.64

 
$
0.44

 
$
1.51

 
$
1.23

Diluted weighted average common shares outstanding
116,388

 
132,124

 
122,692

 
131,837



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Copart, Inc. ~ 14185 Dallas Parkway, Suite 300, Dallas TX 75254 ~ (972) 391-5000



Copart, Inc.
Condensed Consolidated Balance Sheets
(In thousands)
(Unaudited)
 
April 30, 2016
 
July 31, 2015
ASSETS
 
 
 
Current assets:
 
 
 
Cash and cash equivalents
$
137,653

 
$
456,012

Accounts receivable, net
263,292

 
215,696

Vehicle pooling costs and inventories
41,210

 
33,562

Income taxes receivable
2,772

 
6,092

Deferred income taxes
668

 
3,396

Prepaid expenses and other assets
18,910

 
19,824

Total current assets
464,505

 
734,582

Property and equipment, net
806,973

 
700,402

Intangibles, net
13,390

 
17,857

Goodwill
267,367

 
271,850

Deferred income taxes
31,245

 
28,840

Other assets
40,655

 
46,421

Total assets
$
1,624,135

 
$
1,799,952

 
 
 
 
LIABILITIES AND STOCKHOLDERS’ EQUITY
 
 
 
Current liabilities:
 
 
 
Accounts payable and accrued liabilities
$
150,298

 
$
147,452

Deferred revenue
5,745

 
3,724

Income taxes payable
17,169

 
8,279

Current portion of long-term debt, revolving credit facility, and capital lease obligations
30,369

 
53,671

Total current liabilities
203,581

 
213,126

Deferred income taxes
5,001

 
5,322

Income taxes payable
25,675

 
21,157

Long-term debt and capital lease obligations, net of discount
670,507

 
592,135

Other liabilities
2,844

 
3,748

Total liabilities
907,608

 
835,488

Commitments and contingencies
 
 
 
Stockholders' equity:
 
 
 
Preferred stock
—

 
—

Common stock
11

 
12

Additional paid-in capital
393,351

 
407,808

Accumulated other comprehensive loss
(83,791
)
 
(68,793
)
Retained earnings
406,956

 
625,437

Total stockholders' equity
716,527

 
964,464

Total liabilities and stockholders' equity
$
1,624,135

 
$
1,799,952




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Copart, Inc. ~ 14185 Dallas Parkway, Suite 300, Dallas TX 75254 ~ (972) 391-5000



Copart, Inc.
Condensed Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
 
Nine Months Ended April 30,
 
2016
 
2015
Cash flows from operating activities:
 
 
 
Net income
$
185,392

 
$
162,371

Adjustments to reconcile net income to net cash provided by operating activities:
 
 
 
Depreciation and amortization
35,900

 
37,579

Allowance for doubtful accounts
1,227

 
(453
)
Equity in losses of unconsolidated affiliates
768

 
—

Stock-based payment compensation
15,834

 
13,290

Excess tax benefits from stock-based payment compensation
(848
)
 
(1,279
)
Gain on sale of property and equipment
(188
)
 
(735
)
Deferred income taxes
(325
)
 
3,641

Changes in operating assets and liabilities, net of effects from acquisitions:
 
 
 
Accounts receivable
(49,594
)
 
(21,763
)
Vehicle pooling costs and inventories
(8,121
)
 
(1,874
)
Prepaid expenses and other current assets
293

 
1,480

Other assets
3,206

 
7,584

Accounts payable and accrued liabilities
5,024

 
2,042

Deferred revenue
2,038

 
445

Income taxes receivable
4,172

 
985

Income taxes payable
13,858

 
1,313

Other liabilities
(1,138
)
 
(1,257
)
Net cash provided by operating activities
207,498

 
203,369

 
 
 
 
Cash flows from investing activities:
 
 
 
Purchases of property and equipment
(143,833
)
 
(49,079
)
Proceeds from sale of property and equipment
485

 
1,087

Purchases of marketable securities
(21,119
)
 
—

Proceeds from sale of marketable securities
21,498

 
—

Net cash used in investing activities
(142,969
)
 
(47,992
)
 
 
 
 
Cash flows from financing activities:
 
 
 
Proceeds from the exercise of stock options
4,989

 
3,372

Excess tax benefit from stock-based payment compensation
848

 
1,279

Proceeds from the issuance of Employee Stock Purchase Plan shares
1,640

 
1,495

Repurchases of common stock
(442,855
)
 
(1,737
)
Proceeds from the issuance of long-term debt, net of discount
93,468

 
698,939

Debt offering costs
(165
)
 
(955
)
Principal payments on long-term debt
(37,500
)
 
(331,250
)
Net cash (used in) provided by financing activities
(379,575
)
 
371,143

Effect of foreign currency translation
(3,313
)
 
(6,446
)
Net (decrease) increase in cash and cash equivalents
(318,359
)
 
520,074

Cash and cash equivalents at beginning of period
456,012

 
158,668

Cash and cash equivalents at end of period
$
137,653

 
$
678,742

Supplemental disclosure of cash flow information:
 
 
 
Interest paid
$
16,996

 
$
9,705

Income taxes paid, net of refunds
$
86,243

 
$
81,995


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Copart, Inc. ~ 14185 Dallas Parkway, Suite 300, Dallas TX 75254 ~ (972) 391-5000

COPART INC Reports