|By Business Wire||
|May 28, 2014 08:08 PM EDT||
Copart, Inc. (NASDAQ: CPRT) today reported financial results for the quarter ended April 30, 2014.
For the three months ended April 30, 2014, revenue, gross margin and net income were $309.7 million, $132.3 million and $40.9 million, respectively. These represent increases in revenue of $32.1 million, or 11.6%; and in gross margin of $16.7 million, or 14.4%; and a decrease in net income of $12.4 million, or 23.2%, respectively, from the same quarter last year. Fully diluted earnings per share for the three months were $0.31 compared to $0.41 last year, a decrease of 24.4%.
For the nine months ended April 30, 2014, revenue, gross margin and net income were $876.0 million, $351.6 million and $127.6 million, respectively. These represent increases in revenue of $93.4 million, or 11.9%; and in gross margin of $33.8 million, or 10.6%; and a decrease in net income of $11.1 million, or 8.0%, respectively, from the same period last year. Fully diluted earnings per share for the nine months were $0.97 compared to $1.07 last year, a decrease of 9.3%.
Included in operating results of the current quarter is an impairment charge of $29.1 million. In a prior fiscal year, the Company initiated the development of a third-party enterprise operating system to address its international expansion needs and to eventually replace its proprietary operating system, which is currently utilized in the United States, Canada, the United Kingdom and the United Arab Emirates. During the quarter, the Company reassessed this strategy based on the projected cost to complete, deployment risk and certain other factors. As a result of this assessment, the Company decided to cease development of the third-party enterprise operating system and address its international technology needs through an internally-developed proprietary solution. Accordingly, during the quarter, the Company recognized an impairment charge resulting primarily from the abandonment of work previously capitalized in connection with the development of the third-party solution.
Included in the operating results of the third quarter of the prior fiscal year were the incremental revenues and operating expenses associated with incremental unit volume generated by Hurricane Sandy, which were estimated to be $12.7 million and $7.2 million, respectively.
Excluding the impacts of the impairment charge during the current quarter and the effects of Hurricane Sandy during the same quarter last year, for the three months ended April 30, 2014, non-GAAP revenue, gross margin and net income were $309.7 million, $132.3 million and $60.3 million, respectively. These represent increases in non-GAAP revenue of $44.8 million, or 16.9%; in non-GAAP gross margin of $22.1 million, or 20.1%; and in non-GAAP net income of $10.6 million, or 21.4%, respectively, from the non-GAAP results from the same quarter last year. Non-GAAP fully diluted earnings per share for the three months were $0.46 compared to $0.38 last year, an increase of 21.1%. 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.
For the nine months ended April 30, 2014, non-GAAP revenue, gross margin and net income were $876.0 million, $351.6 million and $146.6 million, respectively. These represent increases in non-GAAP revenue of $124.5 million, or 16.6%; in non-GAAP gross margin of $29.4 million, or 9.1%; and in non-GAAP net income of $5.0 million, or 3.5%, respectively, from the non-GAAP results from the same period last year. Non-GAAP fully diluted earnings per share for the nine months were $1.12 compared to $1.09 last year, an increase of 2.8%.
On Thursday, May 29, 2014, 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://220.127.116.11/conferenceamerica. A replay of the call will be available through July 28, 2014 by calling (877) 919-4059. Use confirmation code #17312559.
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 states, to end users. Copart remarkets the vehicles through Internet sales utilizing its VB3 technology. Copart sells vehicles on behalf of insurance companies, banks, finance companies, fleet operators, dealers, car dealerships and others, 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 (www.copart.ae) and Spain (www.autoresiduos.com). Copart links sellers to more than 750,000 members in over 140 countries worldwide through our online multi-channel platform. For more information or to become a member, visit www.copart.com.
Use of Non-GAAP Financial Measures
Included in this release are certain non-GAAP financial measures, including non-GAAP revenue, non-GAAP gross margin, non-GAAP net income and non-GAAP net income per diluted share, which reflect the impact of an impairment charge in the quarter ended April 30, 2014, and revenues and expenses associated with salvage cars processed as a result of Hurricane Sandy. 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 revenue, non-GAAP gross margin, non-GAAP net income and 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 impairment charges and the effects of Hurricane Sandy.
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.
Condensed Consolidated Statements of Income
Three months ended
Nine months ended
(In thousands, except per share data)
|Service revenues and vehicle sales:|
Total service revenues and vehicle sales
|Operating costs and expenses:|
|Cost of vehicle sales||46,263||45,631||135,996||124,146|
|Yard depreciation and amortization||8,110||10,762||27,665||30,524|
|General and administrative||35,856||28,750||110,770||86,186|
|General and administrative depreciation and amortization||4,659||4,034||12,684||11,724|
|Impairment of long-lived assets||29,104||—||29,104||—|
|Total operating expenses||247,089||194,825||676,963||562,749|
|Other (expense) income:|
|Interest expense, net||(2,023||)||(2,400||)||(6,226||)||(7,273||)|
|Total other expense||(1,315||)||(808||)||(2,925||)||(5,230||)|
|Income before income taxes||61,318||82,005||196,151||214,710|
|Earnings per share-basic|
|Basic net income per share||$||0.32||$||0.42||$||1.02||$||1.11|
|Weighted average common shares outstanding||125,794||125,270||125,604||124,755|
|Earnings per share-diluted|
|Diluted net income per share||$||0.31||$||0.41||$||0.97||$||1.07|
|Diluted weighted average common shares outstanding||131,486||130,530||131,095||129,502|
Condensed Consolidated Balance Sheets
|Cash and cash equivalents||$||132,832||$||63,631|
|Accounts receivable, net||192,610||182,714|
|Vehicle pooling costs and inventories||32,216||31,202|
|Income taxes receivable||3,358||9,416|
|Deferred income taxes||4,950||2,216|
|Prepaid expenses and other assets||18,443||15,344|
|Assets held for sale||1,345||1,929|
|Total current assets||385,754||306,452|
|Property and equipment, net||685,707||677,517|
|Goodwill and intangibles, net||313,437||285,169|
|Deferred income taxes||33,971||30,117|
|LIABILITIES AND STOCKHOLDERS’ EQUITY|
|Accounts payable and accrued liabilities||$||164,218||$||136,648|
|Income taxes payable||11,207||4,741|
|Current portion of long-term debt and capital lease obligations||76,171||76,047|
|Total current liabilities||256,742||238,559|
|Deferred income taxes||7,494||8,071|
|Income taxes payable||25,378||23,091|
|Long-term debt and capital lease obligations||242,106||296,410|
|Commitments and contingencies|
|Additional paid-in capital||393,225||368,769|
|Accumulated other comprehensive loss||(21,829||)||(47,161||)|
|Total stockholders’ equity||939,761||762,401|
|Total liabilities and stockholders’ equity||$||1,476,672||$||1,334,481|
Condensed Consolidated Statements of Cash Flows
Nine Months Ended
|Cash flows from operating activities:|
|Adjustments to reconcile net income to net cash provided by operating activities:|
|Depreciation and amortization||40,349||42,248|
|Allowance for doubtful accounts||936||234|
|Impairment of long-lived assets||29,104||—|
|Excess tax benefits from stock-based compensation||(1,219||)||(6,164||)|
|Gain on sale of property and equipment||(1,696||)||(922||)|
|Deferred income taxes||(12,609||)||(3,372||)|
|Changes in operating assets and liabilities, net of effects from acquisitions:|
|Vehicle pooling costs and inventories||(170||)||(4,304||)|
|Prepaid expenses and other current assets||(3,539||)||(2,877||)|
|Accounts payable and accrued liabilities||15,269||21,966|
|Income taxes receivable||7,305||4,213|
|Income taxes payable||8,229||8,695|
|Net cash provided by operating activities||207,634||183,003|
|Cash flows from investing activities:|
|Purchases of property and equipment including acquisitions||(78,078||)||(145,508||)|
|Proceeds from sale of property and assets held for sale||3,271||5,470|
|Net cash used in investing activities||(74,807||)||(140,038||)|
|Cash flows from financing activities:|
|Proceeds from the exercise of stock options||5,680||19,579|
|Excess tax benefit from stock-based payment compensation||1,219||6,164|
|Proceeds from the issuance of Employee Stock Purchase Plan shares||1,115||951|
|Change in bank overdraft||(16,291||)||—|
|Principal payments on long-term debt||(56,250||)||(56,255||)|
|Repurchases of common stock||(80||)||(14,512||)|
|Net cash used in financing activities||(64,607||)||(44,073||)|
|Effect of foreign currency translation||981||327|
|Net increase (decrease) in cash and cash equivalents||69,201||(781||)|
|Cash and cash equivalents at beginning of period||63,631||140,112|
|Cash and cash equivalents at end of period||$||132,832||$||139,331|
|Supplemental disclosure of cash flow information:|
|Income taxes paid||$||65,769||$||68,179|
Additional Financial Information
Reconciliation of GAAP to Non-GAAP Financial Measures
(In thousands, except per share data)
Three months ended
Nine months ended
|GAAP total revenue||$||309,722||$||277,638||$||876,039||$||782,689|
|Effect of Hurricane Sandy||—||(12,736||)||—||(31,161)|
|Non-GAAP total revenue||$||309,722||$||264,902||$||876,039||$||751,528|
|GAAP gross margin||$||132,252||$||115,597||$||351,634||$||317,850|
|Effect of Hurricane Sandy||—||(5,494||)||—||4,392|
|Non-GAAP gross margin||$||132,252||$||110,103||$||351,634||$||322,242|
|GAAP net income||$||40,877||$||53,236||$||127,644||$||138,721|
|Impairment of long-lived assets, net of tax||19,402||—||18,939||—|
|Effect of Hurricane Sandy, net of tax||—||(3,567||)||—||2,838|
|Non-GAAP net income||$||60,279||$||49,669||$||146,583||$||141,559|
|Earnings per share-diluted|
|GAAP diluted net income per share||$||0.31||$||0.41||$||0.97||$||1.07|
|Non-GAAP diluted net income per share||$||0.46||$||0.38||$||1.12||$||1.09|
|Diluted weighted average common shares outstanding||131,486||130,530||131,095||129,502|
A completely new computing platform is on the horizon. They’re called Microservers by some, ARM Servers by others, and sometimes even ARM-based Servers. No matter what you call them, Microservers will have a huge impact on the data center and on server computing in general. Although few people are familiar with Microservers today, their impact will be felt very soon. This is a new category of computing platform that is available today and is predicted to have triple-digit growth rates for some ...
Oct. 22, 2016 11:00 PM EDT Reads: 33,925
Effectively SMBs and government programs must address compounded regulatory compliance requirements. The most recent are Controlled Unclassified Information and the EU’s GDPR have Board Level implications. Managing sensitive data protection will likely result in acquisition criteria, demonstration requests and new requirements. Developers, as part of the pre-planning process and the associated supply chain, could benefit from updating their code libraries and design by incorporating changes.
Oct. 22, 2016 10:45 PM EDT Reads: 1,612
November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. Penta Security is a leading vendor for data security solutions, including its encryption solution, D’Amo. By using FPE technology, D’Amo allows for the implementation of encryption technology to sensitive data fields without modification to schema in the database environment. With businesses having their data become increasingly more complicated in their mission-critical applications (such as ERP, CRM, HRM), continued ...
Oct. 22, 2016 10:30 PM EDT Reads: 910
SYS-CON Events announced today that Cloudbric, a leading website security provider, will exhibit at the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. Cloudbric is an elite full service website protection solution specifically designed for IT novices, entrepreneurs, and small and medium businesses. First launched in 2015, Cloudbric is based on the enterprise level Web Application Firewall by Penta Security Sys...
Oct. 22, 2016 10:30 PM EDT Reads: 1,045
SYS-CON Events announced today that SoftNet Solutions will exhibit at the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. SoftNet Solutions specializes in Enterprise Solutions for Hadoop and Big Data. It offers customers the most open, robust, and value-conscious portfolio of solutions, services, and tools for the shortest route to success with Big Data. The unique differentiator is the ability to architect and ...
Oct. 22, 2016 10:15 PM EDT Reads: 642
Most people haven’t heard the word, “gamification,” even though they probably, and perhaps unwittingly, participate in it every day. Gamification is “the process of adding games or game-like elements to something (as a task) so as to encourage participation.” Further, gamification is about bringing game mechanics – rules, constructs, processes, and methods – into the real world in an effort to engage people. In his session at @ThingsExpo, Robert Endo, owner and engagement manager of Intrepid D...
Oct. 22, 2016 09:30 PM EDT Reads: 9,653
WebRTC adoption has generated a wave of creative uses of communications and collaboration through websites, sales apps, customer care and business applications. As WebRTC has become more mainstream it has evolved to use cases beyond the original peer-to-peer case, which has led to a repeating requirement for interoperability with existing infrastructures. In his session at @ThingsExpo, Graham Holt, Executive Vice President of Daitan Group, will cover implementation examples that have enabled ea...
Oct. 22, 2016 09:00 PM EDT Reads: 2,252
SYS-CON Events announced today that Enzu will exhibit at the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. Enzu’s mission is to be the leading provider of enterprise cloud solutions worldwide. Enzu enables online businesses to use its IT infrastructure to their competitive advantage. By offering a suite of proven hosting and management services, Enzu wants companies to focus on the core of their online busine...
Oct. 22, 2016 09:00 PM EDT Reads: 1,253
@DevOpsSummit has been named the ‘Top DevOps Influencer' by iTrend. iTrend processes millions of conversations, tweets, interactions, news articles, press releases, blog posts - and extract meaning form them and analyzes mobile and desktop software platforms used to communicate, various metadata (such as geo location), and automation tools. In overall placement, @DevOpsSummit ranked as the number one ‘DevOps Influencer' followed by @CloudExpo at third, and @MicroservicesE at 24th.
Oct. 22, 2016 09:00 PM EDT Reads: 3,894
In the next forty months – just over three years – businesses will undergo extraordinary changes. The exponential growth of digitization and machine learning will see a step function change in how businesses create value, satisfy customers, and outperform their competition. In the next forty months companies will take the actions that will see them get to the next level of the game called Capitalism. Or they won’t – game over. The winners of today and tomorrow think differently, follow different...
Oct. 22, 2016 08:45 PM EDT Reads: 853
SYS-CON Events announced today that Roundee / LinearHub will exhibit at the WebRTC Summit at @ThingsExpo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. LinearHub provides Roundee Service, a smart platform for enterprise video conferencing with enhanced features such as automatic recording and transcription service. Slack users can integrate Roundee to their team via Slack’s App Directory, and '/roundee' command lets your video conference ...
Oct. 22, 2016 08:45 PM EDT Reads: 2,004
Enterprise IT has been in the era of Hybrid Cloud for some time now. But it seems most conversations about Hybrid are focused on integrating AWS, Microsoft Azure, or Google ECM into existing on-premises systems. Where is all the Private Cloud? What do technology providers need to do to make their offerings more compelling? How should enterprise IT executives and buyers define their focus, needs, and roadmap, and communicate that clearly to the providers?
Oct. 22, 2016 08:45 PM EDT Reads: 2,470
More and more brands have jumped on the IoT bandwagon. We have an excess of wearables – activity trackers, smartwatches, smart glasses and sneakers, and more that track seemingly endless datapoints. However, most consumers have no idea what “IoT” means. Creating more wearables that track data shouldn't be the aim of brands; delivering meaningful, tangible relevance to their users should be. We're in a period in which the IoT pendulum is still swinging. Initially, it swung toward "smart for smar...
Oct. 22, 2016 08:15 PM EDT Reads: 690
So you think you are a DevOps warrior, huh? Put your money (not really, it’s free) where your metrics are and prove it by taking The Ultimate DevOps Geek Quiz Challenge, sponsored by DevOps Summit. Battle through the set of tough questions created by industry thought leaders to earn your bragging rights and win some cool prizes.
Oct. 22, 2016 08:15 PM EDT Reads: 3,786