On Sept 7, Copart, Inc. (NASDAQ: CPRT) reported financial results for the quarter and year ended July 31, 2022.
For the three months ended July 31, 2022, revenue, gross profit, and net income were $883.4 million, $381.6 million, and $263.7 million, respectively. These represent an increase in revenue of $134.8 million, or 18.0%; an increase in gross profit of $24.1 million, or 6.7%; and an increase in net income of $7.8 million, or 3.0%, respectively, from the same period last year. Fully diluted earnings per share for the three months ended July 31, 2022, were $1.10 compared to $1.06 last year, an increase of 3.8%.
For the year ended July 31, 2022, revenue, gross profit, and net income were $3.5 billion, $1.6 billion, and $1.1 billion, respectively. These represent an increase in revenue of $808.4 million, or 30.0%; an increase in gross profit of $263.1 million, or 19.6%; and an increase in net income of $153.6 million, or 16.4%, respectively, from the same period last year. Fully diluted earnings per share for the year ended July 31, 2022, were $4.52 compared to $3.90 last year, an increase of 15.9%.
Excluding the impact of acquisition-related integration charges, extinguishment of debt, and certain income tax benefits related to stock-based compensation, non-GAAP fully diluted earnings per share for the three months ended July 31, 2022 and 2021, were $1.13 and $1.03, respectively, which was an increase of 9.7%. Excluding the impact of certain discrete income tax items, acquisition-related integration charges, extinguishment of debt, certain legal matters, and certain income tax benefits related to stock-based compensation, non-GAAP fully diluted earnings per share for the year ended July 31, 2022 and 2021, were $4.46 and $3.70, respectively, which was an increase of 20.5%.
On Thursday, September 8, 2022, at 11:00 a.m. Eastern Time, Copart conducted a conference call to discuss the results for the quarter.
According to Gavin Renfrew – Vice President, Global Accounting, on the conference call:
“Global gross profit in the fourth quarter increased by $24.1 million or 6.7% and our gross margin percentage decreased by approximately 455 basis points to 43.2%. U.S. margins decreased from 51% to 46.3% and international margins decreased from 29.6% to 26.1%. For FY ’22, global gross profit increased by $263.1 million or 19.6% and our gross margin percentage decreased by approximately 400 basis points to 45.9%.
U.S. margins decreased from 52.6% to 48.9% and international margins decreased from 35.1% to 29.9%. As was true last quarter, this margin decline was primarily attributable to two factors: 200 to 225 basis points of the fiscal year decline was due to purchased vehicles from both a mix shift to purchased vehicles and from the contraction in gross margin rate on our purchased vehicles as the absolute values of those vehicles increase. The balance of our margin contraction is attributable to cost inflation in both towing and labor, offset partially by higher revenue per unit and volume growth.”
Renfrew added:
“However, we believe we can continue to increase margin and returns on capital over time, as we benefit from scale and find further operational efficiencies through technology and innovation. I will now move to a discussion of G&A expenditures, excluding stock compensation and depreciation expenses. G&A spend in the quarter increased $3.6 million or 9.2%. For the year, G&A spend increased to $27.6 million or 18.4%.”
The call is a live webcast and can be accessed at www.copart.com/investorrelations. A replay of the call will be available through November 2022.
Sources www.copart.com
