Copart Sees Profits In Line

Copart, Inc. ( CPRT - Snapshot Report ) posted a 23% increase in profits to 43 cents per share for the third quarter of its fiscal year ended April 30, 2012 from 35 cents in the comparable quarter of prior fiscal year. The bottom line was at par with the Zacks Consensus Estimate during the quarter.

In absolute terms, profits increased 10.6% to $55.5 million from $50.1 million in the third quarter of prior fiscal year. Operating profits rose 7.2% to $87.9 million from $82.0 million a year ago. Consequently, operating margin increased to 36.0% from 34.7% a year ago.

Revenues in the quarter scaled up 3.1% to $244.1 million. Service revenues escalated 3.7% to $203.5 million while revenues from Vehicle sales were flat at $40.6 million on a year-over-year basis.

Copart had cash and cash equivalents of $207.1 million as of April 30, 2012, significantly up from $74.0 million as of July 31, 2011. The company’s total debt increased to $462.9 million as of April 30, 2012 from $375.8 million as of July 31, 2011. Consequently, debt-to-capitalization ratio increased to 44.4% from 40.4% a year ago.

In the first nine months of the fiscal year, the company’s net cash flow from operations deteriorated to $197.0 million from $200.7 million in the prior-year period, mainly due to lower deferred income taxes. Meanwhile, capital expenditures declined to $27.1 million from $70.7 million in the prior-year period.

Copart, headquartered in Fairfield, California, provides a full range of remarketing services to vehicle owners to process and sell salvage and clean title vehicles to dealers, dismantlers, rebuilders, exporters and end users. The company remarkets the vehicles through Internet utilizing its patented Virtual Bidding Second Generation (VB2) technology.

Copart sells vehicles on behalf of insurance companies, banks, finance companies, fleet operators, dealers, car dealerships and individuals. It currently operates 154 facilities in the U.S., Canada and the U.K.

Currently, the company retains a Zacks #3 Rank on its shares, which translates to a short-term (1 to 3 months) rating of Hold. Its competitors include Liquidity Services, Inc. ( LQDT - Snapshot Report ) and Ritchie Bros. Auctioneers Incorporated ( RBA - Snapshot Report ) .