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Copart Expands in Germany

Zacks Equity Research

Copart, Inc. (CPRT) has announced the acquisition of WOM Wreck Online Marketing Aktiengesellschaft. Based in Ettlingen, Germany, WOM provides auction platforms for both buyers and sellers of salvage vehicles in Europe and primarily serves the insurance markets in Germany.

The acquisition of WOM will expand the company’s footprint in Germany and will support its expansion strategy in Europe. The company plans to enhance the WOM platform as well as provide added service to its existing customers in other parts of the world.

Recently, Copart acquired Sao Paulo, Brazil-based Central de Leiloes LTDA. Central is a salvage vehicle auction company, which serves many of the leading automobile insurance companies in Brazil. The acquisition will expand Copart’s presence in South America. The company plans to improve the services available in Brazil and make it at par with the services available in the U.S., Canada, U.K and UAE.

Copart, recorded a 20.7% growth in its earnings to 35 cents per share in fiscal fourth quarter ended July 31, 2012, from 29 cents per share in the corresponding quarter last year. The results surpassed the Zacks Consensus Estimate by a couple of cents. Profit escalated 10.8% to $44.9 million from $40.5 million in the year-ago quarter.

Total revenue increased 5.2% year over year to $226.6 million in the quarter, beating the Zacks Consensus Estimate of $219 million. The year-over-year growth was attributable to increased unit volume sales in North America. However, volume sales in the U.K. remained flat due to the challenging economic condition in the region.

Copart is the provider of online auctions and vehicle remarketing services in the U.S., Canada, U.K. and U.A.E. The company provides a wide range of remarketing services to vehicle suppliers, primarily insurance companies, to process and sell salvage vehicles, mainly over the Internet through its Virtual Bidding Internet auction-style sales technology.

Currently, Copart retains a Zacks #2 Rank, which translates into a short-term Buy rating.

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