e6377314f56f4f742ebe49ece27a23a4d8ee25a0dda559d0c9656eae7ca7593b

Copart, Inc. is a leading global provider of online auctions and vehicle remarketing services, operating in countries such as the United States, United Kingdom, Germany, Brazil, Canada, and several others **[0000900075-24-000024_cprt-20240731.htm:55]**. The company primarily facilitates the sale of vehicles over the internet using its Virtual Bidding Third Generation (VB3) auction technology, serving sellers like insurance companies, banks, finance companies, and individuals **[0000900075-24-000014_cprt-20240430.htm:6]** **[0000900075-24-000007_cprt-20240131.htm:5]** **[0000900075-24-000030_cprt-20241031.htm:5]**. Copart's business model includes acting as an agent for vehicle sales, deriving revenue from auction-related transaction fees, and in some regions, operating on a principal basis by purchasing and reselling vehicles **[0000900075-24-000014_cprt-20240430.htm:6]** **[0000900075-24-000007_cprt-20240131.htm:5]** **[0000900075-24-000024_cprt-20240731.htm:95]**. The company offers a comprehensive range of services, including vehicle merchandising, title processing, and transportation, which are integral to its auction and remarketing services **[0000900075-24-000024_cprt-20240731.htm:7]**. Copart also emphasizes environmental stewardship by facilitating the reuse and recycling of vehicles, parts, and raw materials, contributing to its role in reducing the environmental footprint of the global transportation industry **[0000900075-24-000024_cprt-20240731.htm:55]**.

1. **Auction and Auction-Related Services** - Facilitates online vehicle sales using VB3 auction technology, serving various sellers and deriving revenue from transaction fees.
2. **Vehicle Merchandising** - Provides services to enhance the presentation and appeal of vehicles for sale.
3. **Title Processing** - Manages the legal documentation required for vehicle sales and transfers.
4. **Transportation Services** - Offers logistics solutions for the movement of vehicles to and from auction sites.
5. **Environmental Stewardship** - Promotes the reuse and recycling of vehicles, parts, and raw materials to reduce environmental impact.

ac037132bb73b5136b9c106308f05a49cc63790756010ca3f96637a30fecb623

| Metric [USD Million] | Q1 2025 | Q4 2024 | Q3 2024 | Q2 2024 | Q1 2024 | Q4 2023 | Q3 2023 | Q2 2023 |
|----------------------|---------|---------|---------|---------|---------|---------|---------|---------|
| **United States**    | **947.5**  **[0000900075-24-000030_cprt-20241031.htm:20]**  | N/A     | **918.916**  **[0000900075-24-000014_cprt-20240430.htm:22]**  | **830.7**  **[0000900075-24-000007_cprt-20240131.htm:21]**  | **840.9**  **[0000900075-23-000043_cprt-20231031.htm:20]**  | N/A     | **833.8**  **[0000900075-23-000021_cprt-20230430.htm:20]**  | **787.9**  **[0000900075-23-000010_cprt-20230131.htm:20]**  |
| **International**    | **199.3**  **[0000900075-24-000030_cprt-20241031.htm:20]**  | N/A     | **208.343**  **[0000900075-24-000014_cprt-20240430.htm:22]**  | **189.4**  **[0000900075-24-000007_cprt-20240131.htm:21]**  | **179.5**  **[0000900075-23-000043_cprt-20231031.htm:20]**  | N/A     | **188.1**  **[0000900075-23-000021_cprt-20230430.htm:20]**  | **168.8**  **[0000900075-23-000010_cprt-20230131.htm:20]**  |
| **Total Revenue**    | **1,146.8**  **[0000900075-24-000027_cprt10312024ex99-1.htm:0]**  | N/A     | **1,127.259**  **[0000900075-24-000014_cprt-20240430.htm:22]**  | **1,020.1**  **[0000900075-24-000004_cprt1312024ex99-1.htm:0]**  | **1,020.4**  **[0000900075-23-000037_cprt10312023ex99-1.htm:0]**  | N/A     | **1,021.8**  **[0000900075-23-000017_cprt4302023ex99-1.htm:0]**  | **956.7**  **[0000900075-23-000004_cprt1312023ex99-1.htm:0]**  |

82e9c768f1ec499840959583b3622271dff85c5c53109b13b205d46472914122

| Metric [USD Million] | Q1 2025 | Q4 2024 | Q3 2024 | Q2 2024 | Q1 2024 | Q4 2023 | Q3 2023 | Q2 2023 |
|----------------------|---------|---------|---------|---------|---------|---------|---------|---------|
| Service Revenues     | **986.3**  **[0000900075-24-000027_cprt10312024ex99-1.htm:0]**  | N/A     | **946.63**  **[0000900075-24-000011_cprt4302024ex99-1.htm:0]**  | **861.7**  **[0000900075-24-000004_cprt1312024ex99-1.htm:0]**  | **859.5**  **[0000900075-23-000037_cprt10312023ex99-1.htm:0]**  | N/A     | **847.2**  **[0000900075-23-000017_cprt4302023ex99-1.htm:0]**  | **789.8**  **[0000900075-23-000010_cprt-20230131.htm:20]**  |
| Vehicle Sales        | **160.5**  **[0000900075-24-000027_cprt10312024ex99-1.htm:0]**  | N/A     | **180.63**  **[0000900075-24-000014_cprt-20240430.htm:22]**  | **158.4**  **[0000900075-24-000007_cprt-20240131.htm:21]**  | **160.9**  **[0000900075-23-000043_cprt-20231031.htm:20]**  | N/A     | **174.6**  **[0000900075-23-000021_cprt-20230430.htm:20]**  | **166.9**  **[0000900075-23-000004_cprt1312023ex99-1.htm:0]** **[0000900075-23-000010_cprt-20230131.htm:20]**  |
| Total Revenue        | **1,150**  **[0000900075-24-000027_cprt10312024ex99-1.htm:0]**  | **1,100**  **[0000900075-24-000019_cprt07312024ex99-1.htm:0]** **[CPRT_3400486_3]**  | **1,130**  **[0000900075-24-000011_cprt4302024ex99-1.htm:0]** **[0000900075-24-000014_cprt-20240430.htm:22]**  | **1,020**  **[0000900075-24-000004_cprt1312024ex99-1.htm:0]** **[0000900075-24-000007_cprt-20240131.htm:21]** **[0000900075-24-000007_cprt-20240131.htm:7]**  | **1,020.4**  **[0000900075-23-000043_cprt-20231031.htm:7]**  | **997.6**  **[CPRT_3312726_2]** **[0000900075-23-000027_cprt07312023ex99-1.htm:0]**  | **1,021.8**  **[0000900075-23-000017_cprt4302023ex99-1.htm:0]** **[0000900075-23-000021_cprt-20230430.htm:20]**  | **956.7**  **[0000900075-23-000004_cprt1312023ex99-1.htm:0]**  |

a8999088b0fb6e9f20124068485b54ccf1c1bde0da4f7354e12ee5f8a1dae79f

12f79c84dd7cef3af78bda4a5474e1bbe36a614d573e7923638d3caf316e8f48

bc00d5e2ffea8258127879662e5c544ad5233fbcf1e58c52450b0babc26b447f

1. With the observed 8.6% year-over-year decline in the Manheim Used Vehicle Value Index affecting total loss frequency  **[CPRT_3400486_1]** , how do you plan to sustain growth if used vehicle prices stabilize or increase in the future, potentially reversing this trend?

2. You mentioned that the low-value vehicle segment continues to shrink due to your focus on where you're allocating efforts  **[CPRT_3400486_16]** ; can you elaborate on how this strategic shift impacts your volume and profitability, and whether competition is influencing this decision?

3. Considering the increased yard operation expenses due to expanded acreage and higher property tax bills  **[CPRT_3400486_19]** , what measures are you taking to mitigate these rising costs, and how might this affect your capital allocation and operational efficiency going forward?

4. As you approach a run rate of 1 million titles obtained per year through your Title Express service  **[CPRT_3400486_1]** , what challenges do you anticipate in scaling this offering further, especially given the complexities of varying state regulations and lender requirements?

5. Regarding your Purple Wave business, given that lower interest rates are expected to drive more business activity  **[CPRT_3400486_8]** , how are you positioning yourselves to capitalize on this, and what strategies are in place to manage the diverse needs of sectors like construction and agriculture?

e2e62c93141d39248b0864ffe9708a9f5d1e939c8e4fd0a3e633068e11a5b5a4

United States

- Service Revenues

- Vehicle Sales

- Total Revenue

International

- United Kingdom

- Other

Total Revenue

25ddeb540c331f1ad92a010d0c0f73522675df804f29b0b9d74821949231101a

48c62a9e3bc32997d275238c4d647b7db2cf94ace3ba3f98cd06c6ab54d6439b

Service Revenues

Vehicle Sales

a2cad24def6697d39e3d45388f3cc40f8ebbbb6578976889219d6eb3739bec71

- **Ritchie Bros. (including its subsidiary Insurance Auto Auctions, Inc.)** - Largest national or regional vehicle auctioneer in the U.S.  **[0000900075-24-000024_cprt-20240731.htm:18]** 
- **Carvana** - Competitor in vehicle remarketing  **[0000900075-24-000024_cprt-20240731.htm:18]** 
- **Openlane** - Competitor in vehicle remarketing  **[0000900075-24-000024_cprt-20240731.htm:18]** 
- **Manheim, Inc.** - Competitor in vehicle remarketing  **[0000900075-24-000024_cprt-20240731.htm:18]** 
- **ACV Auctions Inc.** - Competitor in vehicle remarketing  **[0000900075-24-000024_cprt-20240731.htm:18]** 
- **LKQ Corporation** - Largest national dismantler in the U.S., may purchase salvage vehicles directly from insurance companies  **[0000900075-24-000024_cprt-20240731.htm:18]** 

e57c18b53b4a16c85ccc16e97e149257a2b095996a89b286f8002026d71a3d16

23794d91c53ae875c8e247d72561e35d9d06ee07c70c9e0dbcc977a6d161504a

| Name            | Position                                      | Start Date | Short Bio                                                                                                                                                                                                 |
|-----------------|-----------------------------------------------|------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| A. Jayson Adair | Executive Chairman                            | April 2024 | A. Jayson Adair has been with Copart, Inc. since 1989, starting as the manager of operations. He served in various roles including vice president of sales and operations, executive vice president, and president. He became CEO in February 2010 and served until April 2022, then transitioned to co-CEO until April 2024. Since April 2024, he has been serving as the executive chairman  **[0001193125-24-242623_d872193ddef14a.htm:29]** **[0001193125-24-242623_d872193ddef14a.htm:21]** . |
| Jeffrey Liaw    | Chief Executive Officer and Director          | April 2024 | Jeffrey Liaw has served as the CEO of Copart, Inc. since April 2024. He was the Co-CEO from April 2022 to April 2024, and the President and CEO North America from February 2021 until April 2022. He also served as President and CFO in earlier roles. Before joining Copart, he was CFO of FleetPride, Inc. and a principal at TPG Capital Management, L.P.  **[0001193125-24-242623_d872193ddef14a.htm:23]** **[0001193125-24-242623_d872193ddef14a.htm:29]** **[0001193125-24-242623_d872193ddef14a.htm:34]** . |
| Leah C. Stearns | Senior Vice President and Chief Financial Officer | December 2022 | Leah C. Stearns has served as the Senior Vice President and CFO of Copart, Inc. since December 2022. She previously held leadership roles at CBRE Group, Inc. and American Tower Corporation. She has been on the board of directors of EdgeConnex since 2020  **[0001193125-24-242623_d872193ddef14a.htm:29]** **[0001193125-23-263822_d516802ddef14a.htm:40]** . |

5248b3df88ad75cad9d2f8ec58e960a2d756882a0cb52ddf2a4ddfcf682fb11f

| Program Details          | Program 1          |
|--------------------------|--------------------|
| Approval Date            | September 22, 2011  **[0000900075-24-000030_cprt-20241031.htm:18]** **[0000900075-24-000030_cprt-20241031.htm:33]**  |
| End Date/Duration        | No time limit  **[0000900075-24-000030_cprt-20241031.htm:18]** **[0000900075-24-000030_cprt-20241031.htm:33]**  |
| Total additional amount  | 320 million shares  **[0000900075-24-000030_cprt-20241031.htm:18]** **[0000900075-24-000030_cprt-20241031.htm:33]**  |
| Remaining authorization amount | 326 million shares  **[0000900075-24-000030_cprt-20241031.htm:18]** **[0000900075-24-000030_cprt-20241031.htm:33]**  |
| Details                  | Total current authorization is 784 million shares. Repurchases can be made through solicited or unsolicited transactions in the open market or in privately negotiated transactions.  **[0000900075-24-000030_cprt-20241031.htm:18]** **[0000900075-24-000030_cprt-20241031.htm:33]** **[0000900075-24-000024_cprt-20240731.htm:66]** **[0000900075-24-000024_cprt-20240731.htm:111]**  |

82d95f289ff6a7d106b5a9e8bd788ad4163402f6761104b90cdc96fba78d5630

### New Metrics in Q1 2025:
- Specialty Equipment Sales: Expected “meaningful growth in specialty equipment gross transaction value over the next 12 to 24 months”.  **[CPRT_3409787_5]**   
- General and Administrative Expenses: Anticipated that some increased G&A expenses will “partially recede over the next 12 months”.  **[CPRT_3409787_5]**   
- Capital Deployment: Plans to prioritize investments in team development, CAT event portfolio, logistics solutions, and technology platforms.  **[CPRT_3409787_6]**   
- Long-Term Industry Growth: Expects “ongoing organic industry growth” over 5-, 10-, and 20-year horizons.  **[CPRT_3409787_3]**   

37774d33ec74687b22adfdca8227971140b0edc24e7d86a8b9fedbd7c432b85c

| Name               | Start Date | End Date | Reason for Change |
|--------------------|------------|----------|-------------------|
| Ernst & Young LLP | 2006  **[0000900075-24-000024_cprt-20240731.htm:90]**  | Present  | Current auditor   |

adbb21ec7acd2d4f914212f6f77ab0a352ce9bbc41c4d19e2f12014162c6e40c

Number of newly opened facilities in the United States (facilities)

Number of newly opened facilities internationally (facilities)

3a3627b99e6fa4d0a77f9edb9affcf3f3702740f1651cb7ae9465864c87327c9

- Total Revenue: $1,146.829M (+12% YoY)  **[0000900075-23-000043_cprt-20231031.htm:2]** **[0000900075-24-000030_cprt-20241031.htm:2]**   
- Service Revenue: $986.336M (+15% YoY)  **[0000900075-23-000043_cprt-20231031.htm:2]** **[0000900075-24-000030_cprt-20241031.htm:2]**   
- **US Service Revenue**: $126.3M (**+30%** YoY)  **[0000900075-23-000043_cprt-20231031.htm:20]** **[0000900075-24-000030_cprt-20241031.htm:20]**   
- **US Vehicle Sales**: $72.9M (**-12%** YoY)  **[0000900075-23-000043_cprt-20231031.htm:20]** **[0000900075-24-000030_cprt-20241031.htm:20]**   
- Cost of Goods Sold (COGS): $138.178M (-7% YoY)  **[0000900075-23-000043_cprt-20231031.htm:2]** **[0000900075-23-000043_cprt-20231031.htm:20]** **[0000900075-24-000030_cprt-20241031.htm:2]** **[0000900075-24-000030_cprt-20241031.htm:20]**   
- Net Income: $362.1M (+9% YoY)  **[0000900075-23-000043_cprt-20231031.htm:2]** **[0000900075-23-000043_cprt-20231031.htm:20]** **[0000900075-24-000030_cprt-20241031.htm:2]** **[0000900075-24-000030_cprt-20241031.htm:20]**   
- Diluted EPS: $0.37 (+9% YoY)  **[0000900075-23-000043_cprt-20231031.htm:2]** **[0000900075-23-000043_cprt-20231031.htm:20]** **[0000900075-24-000030_cprt-20241031.htm:2]** **[0000900075-24-000030_cprt-20241031.htm:20]**   

5887d92367fd73a389141e37561ecfebc7d815fdff324e3a04d3631824da240e

a1231543f0ff101697dff165037cd2cf6dcebbc6cfa385e957436cca212abe58

1. **Total Loss Frequency**  
   **Q:** Can total loss rate exceed 30% long-term?  
   **A:** Management believes total loss frequency can indeed exceed **30%** over the long term.  **[CPRT_3374676_6]**  Before the pandemic, total loss frequency had approached **21.7%**, and while not all the way back yet, it's just a matter of time.  **[CPRT_3374676_6]**  Rising repair costs and stable used car values make total losses more economically attractive for insurers, leading to an expected increase in total loss frequency over time.  **[CPRT_3374676_6]** 

2. **G&A Spending Trend**  
   **Q:** Is G&A growth rate set to continue?  
   **A:** G&A expenses have been increasing due to investments in new senior talent and expansion into the whole car market and insurance sophistication.  **[CPRT_3374676_7]**  The inclusion of Purple Wave added over **$7.5 million** to G&A in the quarter, a permanent addition.  **[CPRT_3374676_7]**  However, management expects operating leverage over the medium to long term, with unit volume and revenue growing faster than G&A over time.  **[CPRT_3374676_7]** 

3. **Capital Allocation Strategy**  
   **Q:** Thoughts on capital allocation into 2024?  
   **A:** The top priority is investing in the core business, including adding capacity and optimizing yard distribution.  **[CPRT_3374676_13]**  They are expanding geographically and exploring complementary acquisitions like Purple Wave.  **[CPRT_3374676_13]**  Management remains disciplined and patient, with high thresholds for long-term returns, and will act opportunistically when there's tremendous value for shareholders.  **[CPRT_3374676_13]** 

4. **Average Selling Price Resilience**  
   **Q:** Why is ASP resilient despite Manheim Index?  
   **A:** The resilience in average selling price is driven by a shift towards higher-value units from "Blue Car" sellers like dealers.  **[CPRT_3374676_10]**  Increased total loss frequency brings in higher-value vehicles, as insurers total more expensive cars due to elevated repair costs.  **[CPRT_3374676_10]**  Additionally, auction liquidity and platform growth help sustain prices beyond what the Manheim Index reflects.  **[CPRT_3374676_10]** 

5. **Capacity for More Volume**  
   **Q:** Can you onboard more large accounts?  
   **A:** Management has invested ahead of the curve in capacity, logistics, and technology, and is well-equipped to handle additional volume.  **[CPRT_3374676_8]**  They are delighted to serve new business and have the operational capacity across storage, logistics, and platform scalability to onboard more accounts.  **[CPRT_3374676_8]** 

6. **Rising Ocean Freight Rates**  
   **Q:** Impact of rising ocean freight rates?  
   **A:** While rising ocean freight rates might suggest reduced bidding from international buyers, management notes that demand from developing economies remains strong and sustained.  **[CPRT_3374676_9]**  Copart vehicles often remain the preferred option due to limited alternatives.  **[CPRT_3374676_9]**  Backhaul shipping rates are often cheaper, so headline freight increases may not significantly impact buyers.  **[CPRT_3374676_9]** 

7. **International Market Performance**  
   **Q:** Update on various country performance?  
   **A:** There has been strong unit volume growth across all geographies.  **[CPRT_3374676_11]**  The U.K. business mirrors the U.S. with similar total loss trends.  **[CPRT_3374676_11]**  In newer markets like Germany and Spain, performance improvements are driven by market share gains and local dynamics.  **[CPRT_3374676_11]** 

8. **Purple Wave Initiatives**  
   **Q:** Any initiatives after acquiring Purple Wave?  
   **A:** Management is excited about the partnership with Purple Wave and considers their leadership team outstanding.  **[CPRT_3374676_10]**  They are finding ways to support each other efficiently but are primarily focused on backing a strong team in the industry.  **[CPRT_3374676_10]** 

9. **Recent California Floods Impact**  
   **Q:** Impact of California floods on profitability?  
   **A:** Management is well-equipped with land, trucks, personnel, and technology to respond to events in California.  **[CPRT_3374676_14]**  They have not observed events of significant magnitude similar to previous storms like Ian or Ida.  **[CPRT_3374676_14]**  Should activity increase, they are prepared to invest accordingly.  **[CPRT_3374676_14]** 

10. **Noninsurance Unit Economics**  
    **Q:** Can you discuss noninsurance unit economics?  
    **A:** Management avoids discussing specific seller fees but provides tailored value to each seller.  **[CPRT_3374676_12]**  Noninsurance units often have higher ASPs but can be higher touch and more transactional.  **[CPRT_3374676_12]**  There is scalability with large insurance companies due to B2B integrations, which is less so with smaller sellers.  **[CPRT_3374676_12]** 

85aa854065d736f66fe792d52a7f0a25937ce882d6477eff73588104bc9028b6

1. **Dealer Car ASPs**
   **Q:** How are dealer car ASPs affected as used car values drop?
   **A:** Despite used car values dropping, Copart's dealer car average selling prices (ASPs) have decreased less than the Manheim Index, due to a mix shift toward higher-value units. The Manheim Index is down about **14% year-over-year**, while Copart's dealer units are down just over **5%**, as they're adding higher-value vehicles driven by rising total loss frequency.  **[CPRT_3389649_5]** 

2. **Dealer Car Growth Sources**
   **Q:** Where is dealer car growth coming from?
   **A:** The growth in dealer cars comes from various channels, including physical auctions, online platforms, and direct sales. Copart competes effectively against multiple outlets by expanding its buyer base and offering better auction outcomes, attracting vehicles that might have been sold through other means.  **[CPRT_3389649_6]** 

3. **International Buyer Impact**
   **Q:** Has international buyer demand shifted due to tight supply?
   **A:** International buyers have become increasingly important, now accounting for a majority of the value of U.S. auctions. They are instrumental in driving the value of nearly **90%** of cars sold at Copart, either as buyers or key bidders, and their influence continues to grow as they face tighter supply in their markets.  **[CPRT_3389649_8]** 

4. **Advancements in AI for Total Loss**
   **Q:** How is Copart progressing in monetizing data for total loss decisions?
   **A:** Copart sees significant potential in using AI and data to help insurers make better and faster total loss decisions. While full integration is still in progress, they continue to offer tools that can increase total loss frequency over time by improving decision-making processes.  **[CPRT_3389649_7]** 

5. **Insurance Share Gains**
   **Q:** What drives Copart's share gains with insurers, and how sticky are they?
   **A:** Copart gains share by delivering superior auction returns, reducing costs through faster cycle times, and providing exceptional service during catastrophic events. These relationships have proven durable, as they consistently earn clients' trust by improving outcomes and investing in capabilities that meet insurers' needs.  **[CPRT_3389649_10]** 

6. **Operating Expenses Outlook**
   **Q:** How should we think about OpEx over the next 12-18 months?
   **A:** Over the long term, Copart expects operating income and gross profits to grow faster than operating expenses and G&A. Though they've recently seen meaningful year-over-year growth in expenses due to investments, they remain committed to prudent capital stewardship and investing where it makes sense for long-term returns.  **[CPRT_3389649_15]** 

7. **Purple Wave Progress**
   **Q:** Can you update us on the Purple Wave partnership?
   **A:** Purple Wave continues to grow its Gross Merchandise Value (GMV) year-over-year, with opportunities in geographic expansion and adding new sellers. The trends are promising, and management is focused on prioritizing among multiple growth opportunities.  **[CPRT_3389649_11]** 

8. **International Growth Drivers**
   **Q:** What's driving international growth, and are you gaining traction in Europe?
   **A:** Copart is experiencing growth across all major international markets, including Canada, Brazil, the U.K., and Europe. Growth is driven by increased total loss frequency and market penetration, leading to meaningful growth and traction in larger vehicle markets like the EU.  **[CPRT_3389649_13]** 

9. **Inflation Impact on Insurance**
   **Q:** How does inflation in the insurance industry affect Copart?
   **A:** Inflation leading to higher insurance rates may have marginal effects, such as slight increases in uninsured motorists or shifts to liability-only coverage. However, Copart doesn't expect a meaningful impact on its business, as total loss vehicles will eventually be processed regardless of insurance coverage.  **[CPRT_3389649_9]** 

10. **Higher-Value Dealer Units**
    **Q:** Can you update us on initiatives toward higher-value dealer units?
    **A:** Copart continues to develop services like condition reporting, inspection, and arbitration to better serve dealers with higher-value units. By expanding these offerings, they aim to make more dealer cars addressable through Copart auctions.  **[CPRT_3389649_14]** 

7249b903a60ab3b294d395a942777cb6ae97a653e95516efb518acf32ce7fd4e

- **Copart is experiencing strong international growth**, with unit volumes increasing over **21%** in markets like Canada, Brazil, the UK, Germany, and Spain.  **[CPRT_3389649_13]**
- **International buyers are becoming increasingly important**, accounting for a majority of the auction value and driving higher returns for Copart's auctions.  **[CPRT_3389649_8]**
- **Copart is successfully expanding in the dealer segment**, moving towards higher-value units, leading to increased unit volumes and capturing market share from competitors.  **[CPRT_3389649_6]** ,  **[CPRT_3389649_14]**

89de4ae479195d6751cfe848ff45fedb66e0f8143ce1dfef244d65e195c378c7

- **International expansion is progressing slowly**, with **"nothing radically new to report"** in key markets like Germany and Spain, potentially limiting growth opportunities.  **[CPRT_3367479_13]** **[CPRT_3367479_12]**
- The company acknowledges that **"our own bandwidth"** is a scarce resource, which may **limit the ability to pursue multiple initiatives successfully**, potentially impacting growth prospects.  **[CPRT_3367479_6]**
- Copart incurs **significant costs to prepare for storm seasons**, even when storms do not result in **increased vehicle volumes**, which could **negatively impact margins**.  **[CPRT_3367479_9]**

f6f919f5855898ac0e432c25ef5f92da1e6841a0dcbe9ce1c10fbbc42abed260

- **Copart's general and administrative expenses have increased meaningfully year-over-year**, which may pressure margins in the short term. This rise is due to investments in sales, marketing, product development, technology functions, system implementations, and the consolidation of acquisitions like Purple Wave.  **[CPRT_3389649_15]**
- **Declining used car values are leading to softer selling prices for dealer cars**, potentially impacting Copart's revenues in this segment. The company acknowledges that selling prices for dealer cars are somewhat softer due to the drop in used car values.  **[CPRT_3389649_4]**
- **Copart faces multidimensional competition in its non-insurance vehicle segment**, including physical auctions, online platforms, wholesalers, and sellers' own channels, which may impact growth and margins in this area.  **[CPRT_3389649_6]**

6240c08dd0e1937d9fb774f4e001e3979a1e09081110b9092f34dc94e4ccf551

- Copart is experiencing strong growth in its non-insurance segments, with the **Blue Car** segment growing over **35%** and the **dealer** segment growing **13%**, driven by multiple accounts across banks, rental car companies, and corporate fleets.  **[CPRT_3367479_16]** ,  **[CPRT_3367479_13]**
- The company is expanding internationally, focusing on growth in markets like **Germany** and **Spain**, and continues to invest aggressively in its international buyer base.  **[CPRT_3367479_12]** ,  **[CPRT_3367479_19]**
- Copart is strategically expanding into new markets through investments like **Purple Wave**, entering the industrial, construction, and agricultural equipment auction spaces, which offers significant future growth potential.  **[CPRT_3367479_7]** ,  **[CPRT_3367479_5]**

d9cc316ec4fb04ea0c1d8771c35b34e86dcfac6eb1ce047b2ab02a9cae0bcfd7

- **Copart's non-insurance business is expanding significantly**, with substantial contributions from Blue Car volume, serving institutional sellers like banks, rental car companies, corporate fleets, and dealers, all of which are meaningful in their non-insurance business.  **[CPRT_3400486_20]**
- **The introduction of the Express Titling product** allows Copart to take over title processing from insurance companies, saving **time and costs** for insurers and strengthening relationships, as they trust Copart to handle functions historically led by the insurance industry.  **[CPRT_3400486_10]** **[CPRT_3400486_12]**
- **Building out the whole car business, particularly Dealer and Blue Car, is expected to yield higher average selling prices and better unit economics in the long term**, despite upfront investments to support growth.  **[CPRT_3400486_6]**

9189ba97c9261f20af95e887ec91855dbbe338cbd08650cef40fc8d3609dbfea

- **General and administrative expenses increased by over $24 million**, reaching over $72 million in the quarter, which may negatively impact profitability in the short term. This increase includes over $3 million in one-time costs and investments in technology and sales organizations.  **[CPRT_3374676_3]** ,  **[CPRT_3374676_7]**
- **Rising ocean freight rates due to geopolitical conflicts** could potentially impact international buyers, leading to lower bidding prices and affecting auction results.  **[CPRT_3374676_9]**
- **Higher touch and more transactional nature of the non-insurance (Blue Car) business** implies higher costs, which could affect unit economics and margins.  **[CPRT_3374676_12]**

59f3c40b3387ea468e29a96915f5fffb171d2cbd7683609ba155fa5ca92fe7fd

- **Declining Accident Frequency May Reduce Insurance Vehicle Volumes**: Copart's executive acknowledged that accident frequency is gradually declining due to safer vehicles, which could potentially reduce the supply of total loss vehicles from insurance companies.  **[CPRT_3400486_9]**
- **Upfront Investments Could Pressure Short-Term Margins**: Copart is making significant upfront investments in infrastructure and sales to build out its whole car business, particularly in Dealer and Blue Car segments. These investments may pressure margins in the near term before yielding long-term benefits.  **[CPRT_3400486_6]**
- **Shrinking Low-Value Vehicle Segment Due to Competition**: The company is experiencing continued shrinkage in its low-value vehicle segment, attributed to competitive tensions and strategic resource allocation, which could negatively impact volumes and revenue from this segment.  **[CPRT_3400486_16]**

5e97461c4116454840cb58a02c5cfcca3ece6423720f9d12b931f7e21fc30d57

1. **Insurance Unit Growth**  
   **Q:** Is the 6% insurance volume growth driven by share gains?  
   **A:** The **6% growth** in insurance units reflects both organic growth and market share capture. While exact figures aren't specified, this increase showcases our efforts in expanding the insurance segment.  **[CPRT_3400486_17]** 

2. **Express Title Service Impact**  
   **Q:** How does Express Title service benefit insurers and Copart?  
   **A:** Our Express Title service saves insurers time and fully burdened costs by handling title transfers more efficiently than they could individually. This forward integration leverages our scale and expertise, resulting in over **1 million title transfers** this year. It strengthens relationships with insurers and contributes to market share gains.  **[CPRT_3400486_10]** **[CPRT_3400486_11]** **[CPRT_3400486_12]** 

3. **Yard Operating Expenses**  
   **Q:** What's driving the increase in yard operating expenses?  
   **A:** Higher yard operation costs are due to nonrecurring expenses, including **$16 million** in the fourth quarter related to prior period property taxes and vendor invoicing. Increased acreage and rising property values have also raised property taxes. While we continue to invest in expanding our real estate footprint, these costs are expected to stabilize over time.  **[CPRT_3400486_13]** **[CPRT_3400486_19]** 

4. **Impact of Reduced Insurance Coverage**  
   **Q:** How do consumers cancelling or reducing insurance affect Copart?  
   **A:** Historically, a reduction in insurance coverage has a modestly negative impact on our business. If consumers drop collision or comprehensive coverage, fewer vehicles are processed through insurance claims and thus don't reach Copart. However, past economic downturns showed only negligible effects on our volumes.  **[CPRT_3400486_15]** 

5. **Purple Wave Expansion**  
   **Q:** How is Purple Wave expanding, and will lower rates help?  
   **A:** Purple Wave is transitioning from a regional to a national presence, expanding geographically. Lower interest rates could stimulate more business activity, increasing equipment purchases and trade-ins, which benefits intermediaries like Purple Wave. Growth is driven by both territory expansion and in-territory growth.  **[CPRT_3400486_7]** **[CPRT_3400486_8]** **[CPRT_3400486_14]** 

6. **Non-Insurance Volume Dynamics**  
   **Q:** Why is the low-value vehicle segment shrinking?  
   **A:** The low-value vehicle segment continues to shrink due to our strategic focus and allocation of resources. It's a combination of competitive tension and prioritizing higher-value units where we can maximize returns.  **[CPRT_3400486_16]** 

7. **Fee Increase Approach**  
   **Q:** Any updates on fee increases amid pricing moderation?  
   **A:** While it's a substantive question, we don't discuss fee schedules publicly. Our focus remains on delivering value to our sellers and buyers, trusting we'll capture our appropriate share over time. No changes in our approach due to the competitive environment were disclosed.  **[CPRT_3400486_21]** 

786519d82711a0ebe37cadfd4c2838954f615272c856f2999c9755a73116886f

- **Significant growth in Copart's non-insurance business**, with U.S. non-insurance automotive volume (excluding low-value and wholesale units) increasing over **30% year-over-year**.  **[CPRT_3374676_0]**  This growth is driven by higher volumes from Blue Car sellers and dealer units, which are higher average selling price (ASP) units.  **[CPRT_3374676_10]**
- **Resilient average selling prices** despite industry-wide decreases in used car prices, due to a mix shift towards higher-value vehicles and strong auction liquidity from a global buyer base.  **[CPRT_3374676_10]**  This demonstrates Copart's **pricing power** and robust demand in its marketplace.
- **Strategic investments in capacity expansion, technology, and talent** position Copart for future growth and market share gains.  **[CPRT_3374676_8]** **[CPRT_3374676_13]**  The company has the operational capacity to handle additional volumes and is well-prepared to onboard new accounts and manage increased demand from both insurance and non-insurance sellers.  **[CPRT_3374676_8]**

9a275ce3d56102fefe19104f036bc139cb5a6c4d5edda2168cec6d84bc873d19

1. **Consignment Shift in Germany**  
   **Q:** Are we reaching a turning point towards consignment models in Germany?  
   **A:** Management noted progress in moving towards consignment models in Germany, following a gradual progression similar to other markets. They aim to align interests with clients by being on the same side of the table and believe there's still room to grow in this direction.  **[CPRT_3409787_14]** 

2. **CapEx Investments Uptick**  
   **Q:** Can you explain the uptick in CapEx spend and expectations?  
   **A:** CapEx is primarily invested in **land**, **development**, and **technology**.  **[CPRT_3409787_15]**  Management emphasized their willingness to invest thoughtfully to serve clients, noting that fluctuations in capital expenditures can occur due to the timing of land acquisitions and development projects.  **[CPRT_3409787_15]** 

3. **Dealer Services Volume Dip**  
   **Q:** Dealer Services was down under 1%; what's driving this?  
   **A:** Management observed a slight pause in September due to lower volumes related to specific accounts but noted that volumes came back in October.  **[CPRT_3409787_13]**  They believe the softness was correlated with the broader wholesale market and do not expect this headwind to persist.  **[CPRT_3409787_13]** 

4. **G&A and Sales Team Growth**  
   **Q:** Will G&A spending continue to increase with sales team growth?  
   **A:** The company has **doubled the headcount** in their sales team since the acquisition.  **[CPRT_3409787_11]**  While they will be disciplined in making investments, opportunistic hires may continue if they find the right talent.  **[CPRT_3409787_11]** 

5. **Loss Frequency Variations**  
   **Q:** What causes variations in total loss frequency among insurers?  
   **A:** Variations are due to factors like the **type of cars insured**, customer service accommodations, and differing total loss practices.  **[CPRT_3409787_7]**  Some insurers use statutory thresholds for totaling vehicles, while others make individual economic decisions, leading to a **huge dispersion** among carriers.  **[CPRT_3409787_7]** 

6. **Impact of CAT Events on Uninsured Motorists**  
   **Q:** Do CAT events affect uninsured motorist rates?  
   **A:** Management stated that, based on data from the Insurance Institute, they haven't seen meaningful changes in uninsured motorist populations attributable to CAT events.  **[CPRT_3409787_9]** 

7. **Blue Car Initiative and Off-Lease Vehicles**  
   **Q:** Does reduction in off-lease vehicles impact Blue Car supply?  
   **A:** Off-lease volumes impact their **CDS (Dealer Services)** business more than the Blue Car program.  **[CPRT_3409787_8]**  Blue Car units typically have some level of damage, and off-lease reductions influence overall wholesale unit volume and pricing but are **less impactful** on Blue Car.  **[CPRT_3409787_8]** 

8. **CAT Cars in Florida Market Share**  
   **Q:** How does three out of four CAT cars in Florida going through Copart compare to market share?  
   **A:** Management believes it reflects their market presence and **competitive advantage** in responding quickly to catastrophic events.  **[CPRT_3409787_12]**  Their Title Express team helps in retrieving titles swiftly, contributing to this advantage.  **[CPRT_3409787_12]** 

9. **Impact of Tariffs on Business**  
   **Q:** Did the Trump tariffs affect your business in '18-'19?  
   **A:** They did not observe a **meaningful impact** attributable to tariffs.  **[CPRT_3409787_10]**  Countries affected by the tariffs are not significant importers of cars to the U.S. nor significant export markets for Copart.  **[CPRT_3409787_10]** 

faf2d2114d2ce477e0bc8f9ff744d32a504de205f9a9ba078cacb170fdebe2c3

Copart Inc (CPRT)

Financials