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COPART INC 8-K Report, Financial Results (May 16, 2024)

Reports
Earnings & Results·Exhibits & Filings
Filing Date
Filed May 16, 2024
Period End
May 16, 2024
Security
CPRT
In the record · 2016–202610-K1110-Q328-K93

CPRT filed 11 annual reports (10-K), 32 quarterly reports (10-Q) and 93 current reports (8-K) between 2016 and 2026.

  1. Material agreement8-K · Jul ’16Jul ’16
  2. Leadership change8-K · May ’21May ’21
  3. Leadership change8-K · May ’23May ’23
  4. Deal closed8-K · Oct ’26Oct ’26

01—Abstract

Summary

Summary of the 8-K filed May 16, 2024. Cited figures are marked; the original filing is the authoritative source.

Copart (NASDAQ: CPRT) reported third quarter fiscal 2024 results for the three months ended April 30, 2024, with growth across the top line and profitability.

Total service revenues and vehicle sales rose 10.3% year over year to $1.13 billiona, driven by a 11.7% increase in service revenues to $946.6 million, partially offset by a 3.5% rise in vehicle sales. Gross profit increased 8.7% to $525.5 million, while operating income grew a more modest 4.4% to $437.2 million, as yard operations costs (+13.9%), yard depreciation (+38.4%), and general and administrative expenses (+45.4%) grew faster than revenue. Diluted EPS was $0.39 versus $0.36 a year earlier, up 8.3%, and net income attributable to Copart rose 9.1% to $382.3 million.

Interest income nearly doubled to $36.2 millionb, which helped bolster pre-tax income growth of 7.2%. For the nine months ended April 30, 2024, the picture is stronger: revenue reached $3.17 billion (+10.3%), gross profit rose 13.6% to $1.45 billion, and net income attributable to Copart grew 16.9% to $1.04 billion, with diluted EPS of $1.07 versus $0.92 (+16.3%). Operating cash flow was $1.03 billion, essentially flat year over year, while capital expenditures increased to $373.1 million from $346.5 million.

The company significantly expanded its cash and investment position, with held-to-maturity investments rising to $2.0 billionc and total cash and investments reaching roughly $3.1 billion, alongside a $511 million increase in goodwill that reflects an acquisition during the period. Total assets grew to $8.0 billion and stockholders' equity to $7.2 billion, while total liabilities remained modest at $814 million.

Investors should note the sharp rise in G&A expenses (up 45.4%d in the quarter), which compressed operating margin to roughly 38.8% from 41.0% a year earlier, and the decline in vehicle sales revenue for the nine-month period. The filing itself is a earnings press release furnished under Item 2.02 and is not deemed filed; it does not include forward guidance, and results are unaudited.

02—Key points

Key Highlights

  1. Q3 FY2024 total revenue rose 10.3% to $1.13 billion, with service revenues up 11.7% to $946.6 million.
  2. Q3 diluted EPS was $0.39 versus $0.36 a year ago (+8.3%); net income attributable to Copart grew 9.1% to $382.3 million.
  3. Operating income grew only 4.4% to $437.2 million as G&A expenses surged 45.4% and yard depreciation rose 38.4%, compressing operating margin to about 38.8% from 41.0%.
  4. Nine-month results were stronger: revenue up 10.3% to $3.17 billion, net income up 16.9% to $1.04 billion, and diluted EPS of $1.07 (+16.3%).
  5. Interest income nearly doubled in the quarter to $36.2 million (+102.6%), supported by a larger held-to-maturity investment portfolio of $2.0 billion.
  6. Goodwill increased to $511.4 million from $394.3 million, indicating an acquisition completed during the nine-month period, with $17.7 million of cash acquired.
  7. Operating cash flow was $1.03 billion for the nine months, roughly flat year over year, while capex rose to $373.1 million; the company ended the period with $1.09 billion in cash and restricted cash.

03—Questions

Frequently Asked Questions

  1. How did Copart perform in the third quarter of fiscal 2024?

    Copart grew revenue 10.3% to $1.13 billion and net income attributable to the company 9.1% to $382.3 million. Diluted EPS rose to $0.39 from $0.36. Service revenue growth of 11.7% outpaced a 3.5% increase in vehicle sales.

  2. Why did operating income grow more slowly than revenue?

    Operating expenses grew 14.5%, faster than revenue. The main drivers were a 45.4% increase in general and administrative expenses to $76.2 million, a 13.9% rise in yard operations costs, and a 38.4% increase in yard depreciation and amortization. As a result, operating income rose only 4.4% to $437.2 million.

  3. How much of the earnings growth came from interest income?

    Interest income, net increased to $36.2 million from $17.9 million, contributing meaningfully to pre-tax income. Income before taxes grew 7.2% in the quarter, a rate somewhat above operating income growth of 4.4% due to this higher interest income. Investors should consider that interest income is sensitive to interest rates and portfolio size, so it may not be a durable growth driver.

  4. Did the company make an acquisition, and how did it affect the balance sheet?

    Goodwill increased from $394.3 million to $511.4 million, and the cash flow statement shows $17.7 million of cash acquired in connection with an acquisition during the nine months. Intangibles also rose to $76.8 million. The filing does not detail the acquisition itself, so investors should refer to the company's 10-Q for further information.

  5. Is the company's financial position strong, and does the filing include guidance?

    Copart's balance sheet remains strong, with total assets of $8.0 billion, stockholders' equity of $7.2 billion, and total liabilities of $814 million. Cash, cash equivalents, and held-to-maturity investments total roughly $3.1 billion. The press release contains no forward-looking financial guidance, and the financial statements are unaudited.

04—Continue

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