Good day, everyone, and welcome to the Copart, Inc. First Quarter Fiscal 2019 Earnings Call. Just a reminder, today's conference is being recorded. For opening remarks and introductions, I would like to turn the call over to Mr. Jay Adair, Chief Executive Officer of Copart, Inc. Please go ahead, sir.

Thank you, Chantelle. Good morning, everyone, and welcome to the first quarter conference call for Copart fiscal 2019. It's my pleasure this morning to turn it over to Jeff, who will go through the financials. We'll then come back to Will, who will give you an update on U.S. and international. And then, I will give you an update on what is happening in Germany, since there are a lot of changes going on there, and pass back to Jeff as well. So with that, I'll turn it over to Jeff.

Thanks, Jay. I'll start today's call with a safe harbor. During today's call, we'll discuss certain non-GAAP measures, including non-GAAP net income per diluted share, which includes adjustments to reverse the effect of disposals of nonoperating assets, foreign-currency-related gains and losses and certain income tax benefits related to accounting for stock option exercises. We've provided a reconciliation of these non-GAAP financial measures to the most directly comparable GAAP measures on our website under the Investor Relations link and in our press release issued yesterday. We believe the presentation of these non-GAAP measures, together with our corresponding GAAP measures, is relevant in assessing Copart's business trends and financial performance. We analyze our results on both a GAAP and non-GAAP bases described above. In addition, this call contains forward-looking statements within the meaning of federal securities laws, which are subject to substantial risks and uncertainties that could cause actual results to differ materially from those projected or implied by our statements and comments. For a more complete discussion of the risks that could affect our business, please review the management's discussion and analysis portions in our related periodic reports filed with the SEC. We do not undertake to update any forward-looking statements that may be made from time-to-time on our behalf. Turning our attention first to the first quarter of fiscal 2019. We achieved a record first quarter in unit sales revenue, gross profit and operating income. The period presents a somewhat noisy comparison in comparison to the first quarter of last year given the events of Hurricane Harvey last year and Florence and Michael this year. We'll provide metrics during this call with and without those events to provide you a cleaner comparison. Starting at the top line. Our global revenue grew 10.1% year-over-year. Excluding those three hurricanes I just mentioned,…

Thank you, Jeff. And I'll provide a few comments about our operational performance for the quarter, where we once again delivered a very strong quarter. In the U.S., our volume grew by 4.3% when adjusted for all CAT activity, which includes Hurricane Harvey last year and Hurricanes Florence and Michael this year. Our volume growth continues to be driven by organic growth and market wins within the insurance market and a continued expansion into the noninsurance markets. Organic growth in the salvage market continues to be driven by, we believe, an increase in total loss frequency as high repair costs are leading to a higher percentage of accidents resulting in an economic total loss. We continue to aggressively develop our noninsurance business, which include franchise and independent dealers, finance companies and leasing companies, fleets, charities, municipalities, equipment dealers and wholesalers. The growth in volume was spread broadly across multiple seller segments. Volume from dealers was up 29%, finance companies, 11%, wholesalers, 54%, rental car companies, 30%; and fleet and industrial equipment, up 77%. The only segments in which we experienced declines were charities and municipalities as we intentionally restricted our sales and marketing activities in these low profit segments. We have successfully grown our noninsurance volume as we developed better systems integration and [de-fleet] [ph] bank and dealership operating systems, developed a more focused internal programs targeting the specific operational needs of individual segments and as we continue to increase the returns that we're delivering to our noninsurance sellers. In total, our U.S. noninsurance volume grew by 14% and 44% over the same quarter last year and same quarter two years ago. However, excluding charities and municipalities, our noninsurance volume grew by 30% and 116% for the same quarters. In total, noninsurance business represented approximately 25% of our total U.S.…

Thank you, Will. Good morning again, everyone. Before we discuss Germany, I'd like to give you an overview of the U.K. We knew 15 years ago that we need to be a global business to win. We entered the U.K. in June of 2007 with an acquisition of a small company that had 3 locations called Century Salvage. Shortly after that, we purchased Universal Salvage, giving us 9 locations across the U.K. Today, we have 15 locations that allow us to pick up quickly and economically across the U.K. To win, we knew we needed a network of locations. We grew the business organically by winning new business, by opening additional yards and through some future acquisitions. For those of you that have followed us over the years, you know that we used to have this principle on the vast majority of the insurance cars that we sold in the U.K. At the beginning, we didn't have the track record in the U.K. that we obviously had in the U.S., so we were happy to buy cars and make money in the process. Over time, we simply showed to carriers favorable spreads that we were generating on our trades. And in doing that, they shifted to a consignment model instead of selling their vehicles to us. We do this because it is better to be on the side of our customers as a partner rather than as a vendor purchasing vehicles. Now Copart U.K. is the #1 place to go buy a salvaged vehicle in the U.K., selling well over 300,000 units a year and generating the highest returns in the market. To deliver on the Copart promise, in Germany, we need a network of yards, a marketplace, people and the technology to deliver on that promise. And I'm happy to say that we're there today in Germany. Because Will is focused on running the U.S., Jeff has been able to spend a lot of time working on Germany to get us to this point. So I'd like to turn it over to Jeff now to give you an update on the German operations, and I'd like to thank all of those that were involved in the last 6 months in Germany on making the success that we've seen happen for Copart. Jeff?

Thanks, Jay. On the topic of Germany, you've heard piecemeal from us, of course, over the years. And as promised on the first quarter call, we want to take this opportunity to describe the opportunity and our status in greater detail. I'll start first with a description of the German industry more broadly. The German insurance market, auto insurance market, operates very differently from the U.K. and the U.S. with respect to total loss claims. In the U.S., for example, when you as a covered policyholder total your car, the insurance company effectively buys the car from you, and what happens thereafter is invisible. As you know, the insurance company then consigns the car through Copart and keeps the proceeds of the auction. In Germany, by contrast, nearly every car in an accident, even a mangled one, is owner retained. So when an accident occurs, the insurance company estimates how much value the policyholder has lost by comparing the pre-accident value, or PAV, of the car with the post-accident residual value of the vehicle and pays the policyholder that loss of value. As the insurance company assess that post-accident value, the carrier registers the car on multiple listing services, in effect, miniature auctions on which buyers bid for vehicles. The insurance company generally then chooses the highest bid from across all of these listing services to be the "residual value" from which the indemnity payment is calculated and then paid to the policyholder. The policyholder then has a 21-day option period to sell the vehicle to the listing service auction "winner" at the residual value just established. But there's a catch: these listing services are a really tough experience for the buyers themselves. First, buyers are obligated to honor their bids for a full 21 days after bidding, tying up…

Thank you very much. [Operator Instructions] Our first question will come from Craig Kennison, Baird.

Good morning. Thanks for taking my question and thanks for the terrific summary on Germany. I had a question on the consumer experience in Germany. How does a German consumer find out about Copart or your listing service? And is there anything you need to do to promote the service in ways that you don't have to promote it in the U.S.?

The consumer, Craig, I would argue, is a participant today in the total loss process, as you heard us just describe. The insurance carrier provides them with the indemnification payment for their loss then hands them the details of an offer provided by a third party. It's then the consumer's responsibility to orchestrate that subsequent sale of the car to that winning bidder from the listing service. So if anything, in Germany today, the consumer is arguably too involved in that process. You can imagine you're trying to orchestrate the sale of a one-off vehicle from your home or from a repair shop to an individual you have never known in the past and will never see again in the future, may in fact even be picking up a car from a foreign country, is a complicated endeavor. I don't think that Copart's branding among consumers is essential in Germany. I think building our network and building our credibility with insurance companies and certainly with buyers, which I think you know we already have tremendous credibility with the international buyer base, that's much more important than winning the hearts and minds of consumers individually.

So if you think of all of the totaled cars in Germany, to what extent are you getting a listing opportunity on those cars? What's your market share of listing opportunities, if you will, in Germany?

That's frankly hard to quantify, Craig, in part because for every car that it does experience a severe accident, like the carriers, generally speaking, will list the car on multiple services, WOM or Wreck Online Marketplace, the business I described a few moments ago, is certainly one of the handful of clear market leaders. So our market share position I described is strong without being able to quantify it.

And then, the final question on Germany here. Just obviously, you are purchasing a higher percentage of cars there to more or less kickstart liquidity. Can you give us a feel for the economics of that? And how quickly you can turn a car? So if you invest a few thousand dollars in a car, how quickly does that car turn over? Thank you.

It turns over reasonably quickly. There the titling process is certainly not more complicated than it is in the U.S., for example, so the turnover isn't a challenge per se. The economics -- I think the punchline is that we have been able to buy the cars on these listing services subject to the same adverse selection problems I just described for the marketplace broadly, then turn and sell them to Copart Germany and earn positive profits in the process of doing so. I think the sample size at this point is probably not large enough to provide a deeper -- a very detailed unit economic P&L picture. The punchline is we are able to make money. It's evidence then that the current listing service model is inefficient and costing carriers and policyholders more than it should.

Thanks for the detailed overview.

Thanks, Craig.

Thank you very much. Our next question will come from Bob Labick, CJS Securities.

Lee Jagoda for Bob. Good morning. So just following up on Germany. I think that you guys have about 11 yards in Germany today. What do you think the - what do you think you need to be fully built out in Germany? And how long do you think that, that process could take before we see multiple insurers actually buy in?

Will you let me?

Yes.

Okay. Well, we've announced to date eight locations, correct?

Seven.

Seven, okay. We've announced 7 locations, and we will end up announcing 12 by the time we're done. I would argue, we've got enough of a network now, we can handle cars. So we've got more than enough capacity. We can pick vehicles up quickly, and we're not picking them up economically yet, but we'll be there very soon. I'd say within 90 days, we'll have the economic right, that we'll be happy with what it's costing to get a vehicle picked up. The next step is the marketplace. So by acquiring all these vehicles, as Jeff said, we're getting a strong feel for what they're worth, so we can be even more competitive, buying more vehicles and making a spread on those vehicles. So that will improve, but what's more important than really buying vehicles and making a spread is that we're creating a marketplace where our customers, when they come to Copart, they're guaranteed to get that car. This isn't about going on a platform, and 1 out of 100 times I submit a bid, I end up getting the car because most of the time I'm outbid, I don't know it. And then when I am a high bidder, the insured decides not to sell it to me because they flip it through the dealer to somebody else through adverse selection. So this is a sure thing, guaranteeing that when I bid on Copart, I will get the car. All of our auctions, or I should say, the majority of the cars that we're selling at auction are not on reserve, so there are no reserve auctions. So if you bid, you own it. So that has been our focus. Our focus has not been on getting insurance companies to come on board yet because it's about…

All right. That makes all the sense in the world. Just so I'm clear, though, how many, if any, insurance companies are currently participating on your platform today? And as outsiders, what are the next milestones we should be looking for?

Yes. We have a few, let's say, three, maybe four customers that are really starting to utilize the website now to sell vehicles, but it's not in any way material yet. They're more wanting to try to recover bad vehicles, some hail-damaged vehicles, et cetera, to dispose of those vehicles. And there's a transformation that has to take place where they're not just dealing with inventory that they're stuck with in the sense of recovering [bad] [ph], hail damaged, but that they actually say that this is the process going forward. And again, I can't -- I really can't state it enough, Jeff and I and the rest of the team have been making a number of trips to Germany in the last 6 months, and I can't tell you how confident I am that we're going to see insurers that will switch their process. It's just -- the numbers don't lie. When you look at the returns we're getting on vehicles and you see the amount of times that the insured sells the vehicle somewhere other than the platform, those two combined plus the experience for the customer, I think you're going to see in the next six months some customers switching their process and converting to Copart and the Copart model.

That sounds great. Thank you very much for the color.

You’re welcome.

Thank you very much. Our next question will come from Stephanie Benjamin, Suntrust.

Hi, good afternoon. Thank you for the questions. I just kind of want to go back and again on Germany and kind of thinking through here, obviously you know, there's a lot that – lot that's been done in the last year from building infrastructure, the IT system and just what I'm assuming there a whole lot of investments in the initiative. So just kind of if we think going forward, should we be expecting significantly more investments or this is kind of the run rate and -- to kind of look at it at this point going forward? Or just kind of trying to get a gauge on where we are from just an investment standpoint? And then lastly, I just kind of wanted to follow up on the last question and just thinking about if you have received any pushback for insurance companies or any reasons so far, or maybe they're not just getting it, why they wouldn't immediately switch just considering the returns you can show them, that would be great? Thanks again.

Thanks, Stephanie. I think as you know, we tend not to grant any forward-looking guidance on any aspect of our P&L, revenue costs or otherwise. But in short, I think you can tell from this description today that we have made real strides in Germany but still have meaningful growth aspirations from here as well. So certainly, our hope is that we are investing much more capital because that's a reflection then of ongoing growth in the business. I don't think we're prepared to quantify that or any point there. As to your second question about any resistance from insurance carriers, I don't think there is a lack of willingness or interest. I think the point is that our model, like the one in Germany, has evolved for a reason. And there are tax and regulatory and commercial practices that have been long-standing in Germany. This is a rather different model, I think, very clearly superior, but it certainly will take time to prove to them. As Jay was describing, unit price for car purchase [indiscernible] but the economics are overwhelming. And so there's no resistance per se. I'd say strong interest, strong curiosity in our model.

Great. Appreciate the color. Thanks, again.

Thank you very much. Our next question will come from Daniel Imbro, Stephens Inc.

Thanks, good morning. Thanks for taking my questions. I wanted to follow up a quick one on Germany. I think you guys mentioned, there are three major platforms in the German market. But given the higher returns that you're generating with your model, does any of the incumbent players have the ability or desire to change strategy as you guys are succeeding in that market?

We haven't seen any indication that they are, that they have the desire. And I think we have a fairly strong belief that they wouldn't have the ability regardless. So recall that a majority of the buyers at Copart Germany today are international, so that's on the back of Copart's global reputation, on the back of Copart's already established international buyer base. If somebody tried to replicate that from scratch solely for the purposes of having a more active listing service in Germany, I think that would be a tall order. So no, there's no indication that they have endeavored to do so and [indiscernible].

Okay. And then staying over there in Europe. With Brexit in the U.K. right now, can you maybe talk through how you guys think different outcomes could play out in your business? Or for one, what percentage of the U.K. business is exported to Continental Europe and how potential Brexit outcome could change or disrupt your U.K operations?

I think we - you saw from the disruption a couple of years ago and a year ago, currency fluctuations, that certainly affects our business, as you know, in multiple ways. And so when the pound is weaker, the earnings reflect our P&L at a much lower U.S. dollar rate. That said, I think Brexit clearly remains very much TBD as the portion of cars that are sold outside of the U.K. are disposed of [indiscernible]. So there are cars in the U.K. that go to other places within Europe and probably beyond Europe as well. We expect trade to continue of those cars. Under precisely what tariffs and under what regime will ultimately emerge, I think, remains to be seen.

Okay. Great. And then one last one, moving back to the U.S. business. We seem to have seen U.S. salvage industry growth slowing a little bit. And part of that is noise from the CAT events but even so shaking out sort of the mid-single-digit range. What are you guys seeing in the industry today? And has your volume outlook that you've previously indicated of kind of high single digit industry growth, has that changed at all? Thanks.

Not really. It may have moderated slightly. But given the difficulty in getting land, we really haven't reduced our efforts in expansion in any meaningful manner. And these trends, we try not to react for quarterly changes in trends. We think that in the long run that we're going to see increases in total loss frequency just because of all the dynamics that you all heard about, pre and post-repair expansions of scans and -- or complex cars and younger cars, all that intuitively leads us to the conclusion that total loss frequency will continue to fall.

Thanks a lot.

Thank you. Our next question will come from Chris Bottiglieri, Wolfe Research.

Thanks for taking the questions. First one, so the global inventory ex CAT was up 10% or ex hurricanes, let me call it that way, and volume was up 4%. I guess, how many points of that inventory growth was from international? And then like what else would you attribute the accelerate from?

We kind of gave that. I mean, international is up 14% and U.S. is up 10.4%, so there was growth internationally.

Okay. And why such strong growth in inventory growth in the U.S. then looking forward? What do you say that's driving that?

Well, we don't predict. We've been looking backwards and say that our average volume growth rate over the last 17 quarters has been 10%. And then, there will be natural fluctuations quarter-to-quarter. We really don't see influences change significantly that have driven that thus far, so we think it's going to be in that range.

Got you. Okay. But I'm trying to understand the European market a little bit better both on the supply side and the demand side. At this point, if you're not sourcing from the insurers, is it super majority of your purchases coming from listing services? And then what were mix like of your own wreck listing service versus the third party ones?

Well, I mean, - a handful of customers who are consigning cars to us, but still, the strong majority of the cars sold in Copart Germany today are cars purchased on our listing service.

Got you. Okay. And then demand side, can you talk about the customer mix, how that might differ from what you see in the U.S.? And give us a sense of - I don't think there's a very big salvaged part industry in Europe yet today. So can you maybe talk about how the buyers are different and kind of how you see it evolving, if you do, just to remain in this market?

I think the buyers are ultimately somewhat similar because they are from outside of Germany. So some of the countries that are meaningful buyers, even of Copart U.S. cars today have become the buyers of Copart Germany vehicles as well. They are no doubt dismantling a portion of the cars for parts and are no doubt rebuilding a good number of them as they put back on the road as well.

Okay. Thanks for the help.

Thank you.

Thank you very much. Our next question will come from Gary Prestopino, Barrington Research.

Morning, everyone. Will, you cited various categories of growth in the noninsurance side. I thought it was dealers were up 29%. Could you give me the other segments and the growth that we saw there?

Sure. Our finance companies, which includes banks and leasing companies, was up 11%. Wholesalers, up 4%. Rental car companies was up 30%. And fleet and industrial equipment companies were up 77%.

Okay. Thank you. And then you had 25% of your total U.S. volume in this quarter was noninsurance. What was the percentage last year? Do you have that handy?

I do. It was a little over 22%.

Okay. And then, Jeff, with these noninsurance cars, I would assume that they get sold a hell of a lot faster than the salvaged vehicles. You don't have to put a title and settle with an insurance company on that. Does that - as these grow as a percentage of your U.S. cars sold, does that kind of somewhat distort your inventory growth in a sense of that these cars are flushing out a lot quicker versus the salvage cars?

It can. So each segment that we talked about has its own profile, its own characteristics. So while you might make a sense about a quicker cycle time overall, some segments are actually a slower cycle time. But in general, you're right. It has a - as a group, a quicker cycle time, and therefore, increases the velocity of our yards, improves the utility of our land.

Okay. And then just so I make sure I'm understanding Germany. Germany, if an owner retained, you're actually still going to the owner and buying the car, correct? You're not -- the insurance company is not retaining the car in what you've built?

Correct.

Okay. All right. Do you - and I know, Jay, you mentioned that you're obviously -- you're going to try and do the same strategy that you used in the U.K. to move from a principal agency over time, but are there any U.K. insurers that are writing in Germany right now that could maybe be take the lead in this and kind of start budging the German insurance companies towards going to this contingent basis?

Yes. Gary, we're just in the process right now of preparing the data to share it. So our approach has been very simple. We felt without a marketplace and without a network, we couldn't offer an insurer the vehicle and unit our service and then have to tow it 6 hours north at the Hanover. So we've got the network now. We've got results of the auctions that we can share. And it's really about sharing our data in the next 90 days. And one of the most compelling parts of this to me is, yes, we're making a spread, you can see that, and that's great. But one of the most compelling parts is the fact that the -- when they're a high bidder on one of the platforms, when a buyer is a high bidder on one of the platforms, and that high bidder that's given to the insured, that the majority of the time, the insured doesn't sell it to them. But there's a whole secondary auction that's taking place. That's the problem. And the platform price is the number that the insurance company uses. So that's the number that they're saying, okay, your car is worth 10 grand. It was 30 before the accident. Here's a check for 20, and this buyer will buy it off you. And then the majority of the time, the insured does not sell it to that buyer. Instead, they go out into the secondary market through people that work at the BMW dealership that's doing the repair, through other sources. They're going out because we came out to them. And it's not too hard in Germany, we figured that out. It's not too hard in Germany to figure out where a damaged -- obviously, in the U.S., I give the…

Okay. Thank you very much.

You’re welcome.

Thank you very much. [Operator Instructions] Our next question will come from James Albertine, Consumer Edge.

Thank you so much and good morning to everybody. Great details on Germany. A lot of questions, obviously, already, and I know you don't give guidance. So I wanted to ask sort of a real-world-looking question here a little bit. Are you - can you tell us, rather, if you're on plan or if you're slightly ahead of plan with respect to your -- what you'd budgeted for growth in Germany? And the reason I ask, given the radical change you're bringing to the market and the tax and regulatory setup. I want to understand what the impetus may have been, whether it's consolidation of buyers or sellers or what have you, that may have accelerated the investment there in Germany, and if we could think about the rest of Europe potentially being a little bit faster as that market consolidates over time?

Okay. Well, I think the big change is that we have spent the last two years trying to understand the marketplace with a single location, and it's a learning process. The first part I'd say, you've got to learn how the market works, and there is been a lot of us trying to figure out, okay, why it's the insured - why is our buyer on our platform the high bidder and they don't get the car? And then, you eventually realize as you reach out and make phone calls and talk to people, you find out and you kind of decipher how the marketplace works. And that's how we've now come to the conclusion that there's a secondary auction that takes place and a bunch of other facts that we know about the marketplace. And I would say that it's a big investment in time and it's a big investment in dollars, and we want to make sure that we knew that our model in our minds would work. And we came to that conclusion this year, and that's why we opened up so many locations to build the network of facilities, where we can pick cars up quickly, store them, liquidate them at auction and replicate that process over and over and over. So it was really about being prudent in our approach upfront and learning, and we've spent the last two years doing that. And now we're in a very quick pace to accelerate the market in terms of units going through auction and accelerate the market in terms of getting clients to convert now to the Copart model. And this is simple math, right? They're going to convert, and the insurer is going to be happier that they don't have to deal with a buyer coming at 8:00 at night to pick the vehicle up, and so that's a win. They're going to see Net Promoter Score increases from a customer service standpoint, and they're going to see more money in their pocket because they're not losing the vehicle in the secondary auction. So this should benefit the insured and benefit the insurance company. And our research so far proves that to be the case. Did you want to add to that?

No.

Maybe as a quick follow-up, Jay, if I may. Given the progress you made, the learnings and the breakthrough you've had or it seems that you're having in Germany, does that lower the degree of difficulty to go laterally kind of across Europe? Or will you have to effectively start over in a similar way as you did in Germany if you were to shift into other markets? And then, if I can ask one, Jeff. You talked about the economics. You said it's profitable with your ROIC over time. I would guess this is a very compelling opportunity economically. But from a modeling perspective, and there's no guidance here, but I wanted to get a sense. This must be coming on as sort of dilutive to your corporate EBITDA margin near term, I would imagine. Is that a fair assessment while you're maturing in that market?

So let me tackle those questions individually. First is your question as to the rest of Western Europe. It's certainly the case that we're building the muscle memory now to understand how to roll out in a market with some of the nuances and its own refinements. Certainly, our ability to succeed in Germany will inform our approaches in other countries. So there's -- there will be additional work to be done, so it's not simply replicating the next morning and staying in France or otherwise. But I think we have -- we will have enhanced our capabilities and enhance our reputation, and the friction should be lower for the next iterations of this approach. As for the profitability of the model, I'd first note that given the principal nature of it, I suppose, if you want to literally talk about the math on a -- because they're principal cars, they are clearly dilutive to the margin rates both on the gross line and the operating profit line. As for how the balance of it will evolve over time, I think we just have to be patient and see in future quarters. We're not in a position to provide a forecast.

Understood and appreciate it. And best of luck.

Thank you.

Thank you. Our final question will come from Bret Jordan, Jefferies.

Good morning, guys.

Good morning.

My star one was broken. A quick - I might have missed this. Did you size the German market, how many cars total there annually?

We haven't. We characterize it as substantially larger than the U.K. market. For example, just by comparison, I think if you look at the metrics, whether it's population, GDP per capita, GDP, et cetera, I think we believe it's meaningfully larger than the U.K. And we view the Western European market collectively as being similar or larger than the U.S.

Okay. Great. And then a question on the noninsurance U.S. vehicle. Do a higher percentage of those go to export in the sense that there's less concern around a condition report, whether it's essentially a whole car, is your export shifting as that mix shifts?

Certainly, some are appropriate for the export market, but I would say that the -- without knowing exactly -- without looking it up, I wouldn't think it'd be too materially different than our normal export percentages. So 35% is probably an appropriate expectation.

Right. Directionally, probably a little bit higher because -- simply because the scrap cars are sold in the States. So a local car that's going to be melted down pretty much right away will be sold within a pretty narrow radius location of the yard. And so simply by virtue of dealer cars generally not being melted down, there's probably a higher mix that go in export, but I don't think the difference would be dramatic.

Okay, great. Thank you.

Thank you.

Thank you very much. Ladies and gentlemen, at this time, we have no further questions in the queue, so I'd like to turn the conference back over to management for any closing remarks.

All right. Thanks, Chantelle. Thank you, everyone, for attending the first quarter call for Copart, and we look forward to reporting on next year, and wish you all a happy Thanksgiving.

Thank you very much. Ladies and gentlemen, at this time, this conference has now concluded. You may disconnect your phone lines, and have a great rest of the week. Thank you.