Copart Reports First Quarter Financial Results
FAIRFIELD, Calif.--Nov. 3, 20040, 2004--Copart, Inc. the largest provider of vehicle salvage disposition services in the United States, today reported results for the quarter ended October 31, 2004, the first quarter of its 2005 fiscal year.During the first quarter ended October 31, 2004, Copart earned net income of $22.7 million on revenues of $104.1 million. In the same period last year the company earned $15.2 million on revenues of $91.5 million. These represent increases in net income and revenue of 49% and 14%, respectively. Fully diluted earnings per share (EPS) for the quarter was $.24 compared to $.17 last year, an increase of 41%.
During this quarter same store sales, sales from stores owned or open more than twelve months, increased by 13%.
"We are pleased with our financial performance which continues the trend of double digit growth in revenue and earnings," said A. Jayson Adair, Copart's President. "We attribute these results to the impact of VB2, our proprietary virtual auction technology, which we believe has helped to open our sales to buyers worldwide, eliminating the barriers created by time and distance. In fact, sales of vehicles during the first quarter, to buyers outside the state where the vehicle is located, accounted for 46% of total vehicles sold; 26% were sold out of state and 20% were sold out of country.
"We are delighted at how quickly our buyers have adopted VB2 and the operational leverage it creates for them. Our buyers no longer have to waste their valuable time traveling to and attending physical sales. They can bid from anywhere in the world with Internet access. VB2 has provided access to more vehicles for our growing number of registered buyers to bid on. Since the first quarter of our fiscal 2004, our registered buyer base has increased by over 10% to more than 43,000 buyers.
"We are proud of the value that VB2 has brought to our sellers, buyers and shareholders and we strive to continue to develop compelling, innovative and unique products and services to serve our customers."
Copart, founded in 1982, provides vehicle suppliers, primarily insurance companies, with a full range of services to process and sell salvage vehicles through auctions, principally to licensed dismantlers, rebuilders and used vehicle dealers. Salvage vehicles are either damaged vehicles deemed a total loss for insurance or business purposes or are recovered stolen vehicles for which an insurance settlement with the vehicle owner has already been made. The Company operates 107 facilities in the United States and Canada. It also provides services in other locations through its national network of independent salvage vehicle processors.
Copart, Inc.
Consolidated Statements of Income -- 1
(Dollars in thousands, except per share data)
Three Months Ended
October 31,
2004 2003
Revenues $104,110 $91,467
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Operating costs and expenses:
Yard operations 52,724 51,662
General and administrative 8,713 8,118
Depreciation and amortization 7,605 7,400
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Total operating expenses 69,042 67,180
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Operating income 35,068 24,287
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Other income:
Interest income, net 779 294
Gain on sale of fleet equipment 125 -
Other income 1,070 611
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Total other income 1,974 905
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Income before income taxes 37,042 25,192
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Income taxes 14,372 9,951
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Net income $ 22,670 $15,241
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Basic net income per share $ .25 $ .17
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Weighted average shares outstanding 90,081 89,492
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Diluted net income per share $ .24 $ .17
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Weighted average shares and dilutive
potential common shares outstanding 92,634 91,183
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Copart, Inc.
Consolidated Balance Sheets -- 2
(in thousands, except share data)
October 31, July 31,
2004 2004
ASSETS
Current assets:
Cash and cash equivalents $ 200,041 $ 178,320
Accounts receivable, net 90,710 81,633
Vehicle pooling costs 26,694 23,966
Prepaid expenses and other assets 5,067 5,437
Equipment held for sale 1,289 3,755
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Total current assets 323,801 293,111
Other assets 6,825 6,613
Property and equipment, net 261,660 257,667
Intangibles, net 2,533 2,941
Goodwill 112,691 112,691
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Total assets $ 707,510 $ 673,023
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LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued liabilities $ 41,915 $ 44,080
Deferred revenue 11,352 9,721
Income taxes payable 12,703 3,819
Deferred income taxes 6,489 5,438
Other current liabilities 163 165
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Total current liabilities 72,622 63,223
Deferred income taxes 8,377 6,355
Other liabilities 1,140 1,182
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Total liabilities 82,139 70,760
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Commitments and contingencies
Shareholders' equity:
Common stock, no par value - 180,000,000
shares authorized; 90,092,897 and
90,075,843 shares issued and
outstanding at October 31, 2004 and
July 31, 2004, respectively 267,538 267,276
Accumulated other comprehensive gain 271 95
Retained earnings 357,562 334,892
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Total shareholders' equity 625,371 602,263
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Total liabilities and shareholders'
equity $ 707,510 $ 673,023
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Copart, Inc.
Consolidated Cash Flows -- 3
(in thousands)
Three Months Ended
October 31,
2004 2003
Cash flows from operating activities:
Net income $ 22,670 $ 15,241
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation and amortization 7,605 7,400
Deferred rent (40) (10)
(Gain)/loss on sale of fleet equipment
and other property and equipment (500) 43
Deferred income taxes 3,073 (677)
Changes in operating assets and
liabilities:
Accounts receivable (9,077) (7,231)
Vehicle pooling costs (2,728) (1,709)
Prepaid expenses and other current
assets 370 (425)
Other non current assets (212) 1,150
Accounts payable and accrued
liabilities (2,167) 506
Deferred revenue 1,631 1,008
Income taxes 8,935 9,982
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Net cash provided by operating
activities 29,560 25,278
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Cash flows from investing activities:
Purchase of property and equipment (11,909) (11,260)
Proceeds from sale of property and equipment 3,791 100
Purchase of net current assets in connection
with acquisitions - (154)
Purchase of goodwill and intangible assets
in connection with acquisitions - (685)
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Net cash used in investing
activities (8,118) (11,999)
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Cash flows from financing activities:
Proceeds from the exercise of stock options 211 182
Repurchases of common stock - (10,723)
Principal payments on notes payable (2) (86)
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Net cash provided by financing
activities 209 (10,627)
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Effect of foreign currency translation 70 65
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Net increase in cash and cash
equivalents 21,721 2,717
Cash and equivalents at beginning of period 178,320 116,746
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Cash and equivalents at end of period $200,041 $119,463
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Supplemental disclosure of cash flow information:
Interest paid $ - $ 2
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Income taxes paid $ 1,771 $ 646
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