COPART INC - FORM 8-K - EX-99.1 - September 8, 2021

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8-K - 8-K - COPART INCcprt-20210908.htm

Exhibit 99.1
Copart, Inc.
For Immediate Release
Copart Reports Fourth Quarter Fiscal 2021 Financial Results
Dallas, Texas. (September 8, 2021) — Copart, Inc. (NASDAQ: CPRT) today reported financial results for the quarter and year ended July 31, 2021.
For the three months ended July 31, 2021, revenue, gross profit, and net income were $748.6 million, $357.5 million, and $256.0 million, respectively. These represent an increase in revenue of $223.0 million, or 42.4%; an increase in gross profit of $107.1 million, or 42.7%; and an increase in net income of $90.4 million, or 54.6%, respectively, from the same period last year. Fully diluted earnings per share for the three months ended July 31, 2021 were $1.06 compared to $0.69 last year, an increase of 53.6%.
For the year ended July 31, 2021, revenue, gross profit, and net income were $2.7 billion, $1.3 billion, and $936.5 million, respectively. These represent an increase in revenue of $486.9 million, or 22.1%; an increase in gross profit of $335.3 million, or 33.3%; and an increase in net income of $236.6 million, or 33.8%, respectively, from the same period last year. Fully diluted earnings per share for the year ended July 31, 2021 were $3.90 compared to $2.93 last year, an increase of 33.1%.
Excluding the impact of certain discrete income tax items, acquisition related integration charges, foreign currency-related gains and losses, and certain income tax benefits, non-GAAP fully diluted earnings per share for the three months ended July 31, 2021 and 2020, were $1.03 and $0.68, respectively, which was an increase of 51.5%. Excluding the impact of certain discrete income tax items, acquisition related integration charges, foreign currency-related gains and losses, certain income tax benefits and payroll taxes related to stock-based compensation, non-GAAP fully diluted earnings per share for the year ended July 31, 2021 and 2020, were $3.70 and $2.56, respectively, which was an increase of 44.5%. 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 Thursday, September 9, 2021, at 11:00 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 www.copart.com/investorrelations. A replay of the call will be available through December 2021 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 platform links sellers to more than 750,000 Members in over 170 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 200 locations in 11 countries, Copart has more than 250,000 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.
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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 certain discrete income tax items, acquisition related integration charges, foreign currency-related gains and losses, certain income tax benefits and payroll taxes related to stock-based compensation. 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.
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


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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 
July 31,		Twelve Months Ended 
July 31,
20212020% Change20212020% Change
Service revenues and vehicle sales:
Service revenues$620,048 $457,668 35.5 %$2,291,867 $1,947,140 17.7 %
Vehicle sales128,582 67,991 89.1 %400,644 258,443 55.0 %
Total service revenues and vehicle sales748,630 525,659 42.4 %2,692,511 2,205,583 22.1 %
Operating expenses:   
Yard operations250,396 197,186 27.0 %897,086 889,733 0.8 %
Cost of vehicle sales113,641 54,643 108.0 %346,128 225,294 53.6 %
Yard depreciation and amortization26,567 21,615 22.9 %100,917 76,999 31.1 %
Yard stock-based compensation543 1,784 (69.6)%5,289 5,755 (8.1)%
Gross profit357,483 250,431 42.7 %1,343,091 1,007,802 33.3 %
General and administrative39,652 34,643 14.5 %149,978 149,745 0.2 %
General and administrative depreciation and amortization3,097 5,764 (46.3)%21,054 24,391 (13.7)%
General and administrative stock-based compensation13,234 4,309 207.1 %35,633 17,567 102.8 %
Total operating expenses447,130 319,944 39.8 %1,556,085 1,389,484 12.0 %
Operating income301,500 205,715 46.6 %1,136,426 816,099 39.3 %
Other expense:   
Interest expense, net(5,020)(4,803)4.5 %(20,247)(18,871)7.3 %
Other income, net2,564 971 164.1 %5,667 3,611 56.9 %
Total other expense(2,456)(3,832)(35.9)%(14,580)(15,260)(4.5)%
Income before income taxes299,044 201,883 48.1 %1,121,846 800,839 40.1 %
Income tax expense43,070 36,350 18.5 %185,351 100,932 83.6 %
Net income$255,974 $165,533 54.6 %$936,495 $699,907 33.8 %
Basic net income per common share$1.08 $0.70 54.3 %$3.96 $3.00 32.0 %
Weighted average common shares outstanding236,679 234,863 0.8 %236,252 233,202 1.3 %
Diluted net income per common share$1.06 $0.69 53.6 %$3.90 $2.93 33.1 %
Diluted weighted average common shares outstanding240,714 238,927 0.7 %240,290 238,656 0.7 %

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

Copart, Inc.
Consolidated Balance Sheets
(In thousands)
(Unaudited)
July 31, 2021July 31, 2020
ASSETS
Current assets:
Cash, cash equivalents, and restricted cash$1,048,260 $477,718 
Accounts receivable, net480,628 350,207 
Vehicle pooling costs94,449 73,684 
Inventories44,968 20,080 
Income taxes receivable20,012 26,740 
Prepaid expenses and other assets14,294 15,330 
Total current assets1,702,611 963,759 
Property and equipment, net2,296,624 1,941,719 
Operating lease right-of-use assets119,487 118,455 
Intangibles, net45,873 47,772 
Goodwill355,717 343,622 
Other assets41,831 39,934 
Total assets$4,562,143 $3,455,261 
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable and accrued liabilities$369,826 $318,530 
Deferred revenue20,973 8,233 
Income taxes payable7,760 3,709 
Current portion of operating and finance lease liabilities22,472 25,572 
Total current liabilities421,031 356,044 
Deferred income taxes63,969 71,686 
Income taxes payable52,345 44,965 
Operating and finance lease liabilities, net of current portion97,961 96,150 
Long-term debt and other liabilities, net of discount397,636 396,900 
Total liabilities1,032,942 965,745 
Commitments and contingencies
Stockholders’ equity:
Preferred stock— — 
Common stock24 24 
Additional paid-in capital761,834 672,727 
Accumulated other comprehensive loss(100,860)(121,088)
Retained earnings2,868,203 1,937,853 
Total stockholders’ equity3,529,201 2,489,516 
Total liabilities and stockholders’ equity$4,562,143 $3,455,261 

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

Copart, Inc.
Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
Year Ended July 31,
20212020
Cash flows from operating activities:
Net income$936,495 $699,907 
Adjustments to reconcile net income to net cash provided by operating activities:      
Depreciation and amortization, including debt cost123,084 104,257 
Allowance for credit loss(1,121)1,670 
Equity in (earnings) losses of unconsolidated affiliates(3,240)1,401 
Stock-based compensation40,922 23,322 
Gain on sale of property and equipment(1,480)(1,913)
Deferred income taxes(7,951)23,082 
Changes in operating assets and liabilities, net of effects from acquisitions:
Accounts receivable(127,513)15,993 
Vehicle pooling costs(20,476)2,590 
Inventories(24,602)1,348 
Prepaid expenses and other current and non-current assets7,025 141 
Operating lease right-of-use assets and lease liabilities570 (572)
Accounts payable and accrued liabilities44,613 41,648 
Deferred revenue8,781 1,615 
Income taxes receivable6,739 (7,216)
Income taxes payable9,045 10,114 
Other liabilities— 498 
Net cash provided by operating activities990,891 917,885 
Cash flows from investing activities:
Purchases of property and equipment(462,996)(591,972)
Purchases of assets and liabilities in connection with acquisitions, net of cash acquired(5,000)(11,702)
Proceeds from sale of property and equipment2,530 2,466 
Net cash used in investing activities(465,466)(601,208)
Cash flows from financing activities:
Proceeds from the exercise of stock options39,049 71,640 
Proceeds from the issuance of Employee Stock Purchase Plan shares9,136 8,276 
Payments for employee stock-based tax withholdings(6,145)(103,451)
Debt offering costs— (2,814)
Payments of finance lease obligations(1,118)(1,065)
Net cash provided by (used in) financing activities40,922 (27,414)
Effect of foreign currency translation4,195 2,136 
Net increase in cash, cash equivalents, and restricted cash570,542 291,399 
Cash, cash equivalents, and restricted cash at beginning of period477,718 186,319 
Cash, cash equivalents, and restricted cash at end of period$1,048,260 $477,718 
Supplemental disclosure of cash flow information:
Interest paid$19,723 $19,728 
Income taxes paid, net of refunds$178,241 $83,770 

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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 
July 31,		Twelve Months Ended 
July 31,
2021202020212020
GAAP net income$255,974 $165,533 $936,495 $699,907 
Effect of certain discrete income tax items— 4,740 (19,764)1,732 
Effect of acquisition related integration charges, net of tax2,713 — 2,713 — 
Effect of foreign currency-related losses (gains), net of tax(422)(268)73 (1,436)
Effect of recognizing tax benefit on exercise of stock-based compensation(10,962)(6,586)(29,812)(92,548)
Effect of payroll taxes on certain executive stock-based compensation, net of tax— — — 2,867 
Non-GAAP net income$247,303 $163,419 $889,705 $610,522 
GAAP net income per diluted common share$1.06 $0.69 $3.90 $2.93 
Non-GAAP net income per diluted common share$1.03 $0.68 $3.70 $2.56 

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

COPART INC Reports