Please stand by. Good day, everyone, and welcome to the Copart, Inc. Q1 Fiscal 2022 Earnings Call. As a reminder, today's conference is being recorded. A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. For opening remarks, I would like to turn the call over to Mr. John North, Chief Financial Officer of Copart, Inc. Please go ahead, sir. Morning. During today's call, we'll discuss certain non-GAAP measures, which include adjustments to reverse payroll tax benefits related to accounting for stock option exercises. We provided a reconciliation of these non-GAAP financial measures to the most directly comparable GAAP measures on our investor relations website and in our press release issued yesterday. We believe these non-GAAP measures, together with our corresponding GAAP measures, are relevant in analyzing our results and assessing our business trends and performance. In addition, our comments today include forward-looking statements within the meaning of federal securities laws, including management's current views with respect to trends, opportunities, and uncertainties in our markets, including the COVID-19 pandemic. These forward-looking statements involve substantial risks and uncertainties. For more detail on the risks associated with our business, we refer you to the section titled Risk Factors in our annual report on Form 10-K for the year ended July 31st, 2021, and each of our subsequent quarterly reports on Form 10-Q. Any forward-looking statements are made as of today, and we have no obligation to update or revise any forward-looking statements. With that, I'll turn it over to our President and CEO, North America, Jeff Liaw. Excellent. Thanks, John. Good morning, and thanks for joining us for the Q1. We're pleased to report a strong Q1 for fiscal 2022 against a backdrop of various extremes, a persistent and evolving pandemic, changing global traffic patterns, supply chain disruptions, a strong used car price environment, and an active storm season, to name a few. We continue to serve our customers successfully to enhance auction liquidity and to continue our long-term trend of profitable growth. I'll elaborate on a handful of key themes for the quarter, and John will provide additional perspective. My comments will center around Hurricane Ida, a brief commentary there. Secondly, the health of our auctions. Third, the implications of the used car price environment. Fourth, our institutional commitment to sustainability. First, on Hurricane Ida. Hurricane Ida struck the Gulf States on August 29th in the Northeast region on September 1st and 2nd. This represents our most substantial storm since Hurricane Harvey in 2017, and our largest storm in the Northeast region since Hurricane Sandy in 2012. Having learned from those experiences in a litany of catastrophic events between then and now, we were better prepared for this event than any in our history due to our very substantial investment over the years in land, in technology, in company-owned trucks, company-employed drivers, heavy equipment, and most importantly, our dedicated CAT team, who deployed at a moment's notice. Hundreds of us from around the country spent our Labor Day weekend on the ground and many weeks thereafter managing the retrieval of vehicles, receiving and imaging them, and navigating the vehicles through the titling process to their eventual sale. As is often the case with major storms, we experienced an operating loss from the event in the quarter of a few million dollars. We view our pre-storm prep and our robust response to catastrophic events as investments in the strong and durable partnerships we have with our insurance sellers. Our storm-related costs, as you know from prior experiences, include lease expense for temporary storage facilities, premiums for towing, labor costs and overtime for our people, travel expenses and lodging, among others. These expenses are, of course, offset by revenue from incremental unit volume. Financially speaking, the impact of the storm in the quarter was approximately 100-150 basis points of gross and operating margin rate compression. You'll note we haven't provided further specifics in our press release or included adjustments in our non-GAAP earnings schedule for the catastrophe. We believe that providing excellent service in difficult times is an intrinsic aspect of our value proposition to our customers, and that these storms will increase in frequency and severity over time. The second theme I wanted to tackle is our unit volume growth and our auction liquidity. We experienced global unit sales increase of 21% year-over-year, of which approximately two points was explained by the hurricane itself. A U.S. increase of almost 24%, again, two or three points of that growth explained by Hurricane Ida. We grew our international unit sales by just shy of 8%. The COVID responses in countries outside the U.S., as a general matter, continues to be more aggressive and more pronounced than what we've experienced here stateside. Our insurance business grew relative to the Q1 of last year at 23%. We are observing certainly continued increases in total loss frequency and benefit from share gain as well. Driving activity itself continues to rebound relative to last year very significantly, but still just shy on measures such as gasoline consumption of what we experienced in the year prior. Total loss frequency has increased steadily, including during the pandemic, though all else equal, as many folks on the phone already know, the strong used car price environment almost certainly is an inhibitor to assignment volume, all else equal, to Copart auctions. Turning to our non-insurance volume. When we exclude lower value cars, such as wholesalers and charities, our non-insurance business grew 7.5% year-over-year, with our dealer unit volume up slightly, approximately 1% versus last year, and strong growth in our Copart Direct business. I'll note, and you'll note, this represents solid absolute performance, but arguably the strongest relative performance in our history to other vehicle marketplaces, given what is the pronounced shortage of available supply in the industry. We think this is a testament to the power of Copart's marketplace, and we've said it before, but it's worth reiterating. The cars we earn the right to sell on behalf of insurance companies, along with rising total loss frequency, enable us to achieve superior returns for progressively more non-insurance cars as well. It's also true in reverse. The dealer rental car fleet, bank, and consumer cars we earn the right to sell drive still more insurance volume and higher total loss frequency as the years go by. The next theme I wanted to address is prices themselves. We are experiencing, of course, high used vehicle prices across the world, and certainly strong ASPs at Copart auctions as well. Our ASPs worldwide grew 11% for the year-over-year for the quarter, with U.S. ASPs up 10% year-over-year as well. The Manheim Index, as one industry proxy, is at all-time highs, with a November mid-month reading of 234.8. The durability of ASPs is, of course, a natural question. There certainly are longer-term trends in favor of higher ASPs, including our auction liquidity, total loss frequency, and the like, as well as growing demand from emerging economies for wrecked vehicles from our origin countries. We also continue to invest significant resources in member registration, member recruitment, registration, retention, and the like. Of course, we should acknowledge the technical forces as well. There remains a chip shortage which is affecting the production of new vehicles and driving higher prices for used vehicles around the world. Our perspective doesn't diverge from the industry consensus, which indicates that this chip shortage will persist well into 2022 and likely into 2023 as well. The important note here is that if and when used car prices do fall, we expect a corresponding increase in assignment volumes. Total loss frequency is negatively correlated with used car prices. The more a car is worth before the accident, the more prone it is to being repaired. Last theme I wanted to tackle before handing it to John is the notion of sustainability. As a long-standing cultural matter, we at Copart have always asked to be judged on our actions and results, not our words or our PowerPoint presentations. We recognize that we're at a moment in history in which companies are being challenged to articulate their ESG position more clearly, and I'll spend a few minutes on that theme. Copart plays a critical role in the automotive circular economy, enabling the reuse, recycling, and responsible disposal of vehicles around the world. We sell well over three million vehicles per year, and by matching those vehicles with their optimal owners, we enable the return to service of automobiles that would otherwise have been scrapped, the reuse of parts that otherwise would have ended up in landfills. As a result, the reuse and recycling that Copart enables displaces what otherwise would have been de novo resource extraction and energy-consuming manufacturing as well. As climate events themselves increase in frequency and severity, Copart will play a growing role in assisting communities in recovering from them as we have in our past, by removing vehicles from roadways, storage facilities, and repair shops, enabling the free flow of people and goods and services in the economies in which we do business. Finally, because so many of our vehicles are ultimately purchased by buyers outside the U.S., our auctions contribute to the physical and economic mobility of residents in countries of emerging economies, including in Central and South America, the Middle East, Africa, and Eastern Europe. If you haven't read it already, please do see our annual shareholder letter on our investor relations website, where we expound further on these themes, among others, including diversity and inclusion. We'll offer more substance in the coming days in the form of a sustainability report as well. With that, I'll turn it over to our CFO, John North, to talk about the Q1 's financial results. Thanks, Jeff. Before I get into the numbers, I'd like to begin by also acknowledging our team's effort relative to Hurricane Ida and thank them for their dedication and sacrifice. Being relatively new to the Copart family, this was my first opportunity to see us in action and to observe firsthand the tremendous sense of ownership we take to ensure a positive outcome in the face of both disaster and tragedy. Our people and our culture have always been, and will continue to be, the key to our success. Now I'll make a few comments on our operational results, and then we'll open it up for questions. For the Q1, global revenue increased $217 million or 37%, including a nearly $4 million benefit due to currency. Global service revenue increased $152 million or 30%, primarily due to higher average selling prices and increased volume. U.S. service revenue was up 31%, and international experienced an increase of 18%. Purchased vehicle sales increased $65 million or 84% due to higher ASPs and increased volume. U.S. purchased vehicle revenue was up 87% over the prior year, and international grew 79%. As a result, purchased vehicle gross profit, defined as vehicle sales less cost of vehicle sales, increased by $2.7 million overall. As Jeff mentioned, we had significant relative growth in our purchased vehicle volume, resulting in gross and operating margin rate contraction of approximately 150-200 basis points. Global gross profit in the first quarter increased by $88 million or 30%, and our gross margin percentage decreased by approximately 250 basis points to 47.5%. U.S margins declined from 52.6% to 50.3%, and international margins decreased from 37% to 33.1% due to a higher purchase vehicle mix at lower margins, partially offset by higher ASPs globally. I'll now move to a discussion of G&A expenditures excluding stock compensation and depreciation expense. G&A spend increased $5.9 million from $35.2 million a year ago to $41.1 million in 2022. Yet it's lower from 5.9% of revenue to 5.1% of revenue this year. We anticipate G&A to continue to improve as a percentage of revenue as we grow our business. As a result, our GAAP operating income increased by 33% from $248.6 million to $330.1 million. Q1 income tax expense was $65.5 million at a 20.1% effective tax rate, which reflected a $3 million tax benefit on the exercise of employee stock options. Adjusting those to a non-GAAP measure included in our earnings release changed our effective tax rate to 21%. Q1 GAAP net income increased by 30% from $200 million last year to $260 million this year. Adjusted to remove the tax benefit on the exercise of stock options, non-GAAP net income increased 37% from $188.5 million last year to $257.4 million in the Q1 of 2022. Our global inventory at the end of October increased 12% from last year. This is comprised of a year-over-year increase of 14% for U.S. inventory, and a decline of 3% for international inventory. This increase in inventory is largely a function of U.S. accident frequency and miles driven returning to normal, supplemented with the effects of Ida and share gains, partially offset by declines in international driven by countries with longer duration lockdowns as a response to COVID. Now to briefly update our liquidity and cash flow. As of the end of the quarter, we had $2.3 billion of liquidity, comprised of $1.3 billion in cash and cash equivalents, and an undrawn revolving credit facility with capacity of over $1 billion. Operating cash flow for the quarter increased by $54 million year-over-year to $312.5 million, driven by stronger earnings. We invested $65 million in capital expenditures in the quarter. Approximately 70% of this amount was attributable to capacity expansion. We are continuing to prioritize investments in physical infrastructure above other choices and believe this continued investment is helping to create durable advantages in our ability to handle increasing numbers of total loss vehicles and adjacent opportunities in the wholesale car marketplace. We're continuing to focus on investing for the future in both capacity and technology while maintaining a conservative capital structure that allows operational flexibility regardless of economic changes or transitory market dynamics. With that, we're happy to open up the call for some questions. Thank you. We'll now be conducting a question and answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate that your line is in the question queue. You may press star two if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment, please, while we poll for questions. Thank you. Our first question comes from Stephanie Moore with Truist. Please proceed with your question. Hi, good afternoon. Thank you. Hey, Stephanie. I wanted to touch a bit on the overall inflationary and cost environment that you're currently experiencing, if you are in fact taking the impact of the hurricane out of the equation, and thanks for quantifying the impact that you saw from that event. Just looking at one, the dynamic that you called out in the last quarter was just operating deleverage as inventory levels increase, as well as somewhat newer dynamics that we've heard, whether it's higher towing costs, higher driving costs, you name it. Just kind of want to walk through, if you could, what you're seeing from an inflationary standpoint on higher costs, and then some levers that you might have in place to offset some of those costs would be helpful. Thank you. Sure. In the cost categories you noted, Stephanie, certainly I think all participants in all economies worldwide are experiencing inflation to some extent in the form of wages, towing expense, fuel, capital equipment, and the like. Certainly we aren't immune to that either. It's our job to manage that, to absorb it where necessary, to manage with productivity, as we can, and to deliver the results. It's we are seeing and experiencing those things. I would note that inflation, though it's certainly more pronounced today, it's not a brand new phenomenon. For years, we've experienced very meaningful inflation in healthcare costs. For example, land has continued to grow in value. Capital equipment, the loaders we buy, for example, are more expensive than they were five and 10 years ago as well. Inflation is more pronounced today, but it's not a radically new phenomenon. We do have experience in managing through that, with productivity being the most important long-term lever. Great. I guess maybe just talk a little bit about from an inventory standpoint, do you find that, you know, given where inventory levels are, particularly in the U.S., that you're seeing just as inventory builds, just some operating leverage in the near term, as well as maybe some seasonality? Just trying to think through the dynamic that impacted the Q4 and if that continued in this into the first. A fair question, and as you know, Stephanie, we tend to run the business to deliver service and aren't per se trying to optimize any individual quarter, month or unit in our inventory. I think your observation about inventory growth and unit volume growth helping to absorb fixed or semi-fixed costs is real. There's also other noise in the system, as you know from the inflation you just mentioned a moment ago, Hurricane Ida, among other things. Yes, all else equal, certainly unit volume growth on its own is near medium term accretive to margins. Absolutely. Thank you. Lastly for me, you know, kind of big picture, you know, you put out a release in early November about a partnership with, I believe, Title Express that just talks about some of the digital efforts that you have in place. Kind of rare as I feel like most of the time you don't advertise some of the investments and initiatives you have in place. But maybe if you could talk about incremental investments that you're looking, going forward. Is it focused on improving cycle times, or what are areas where you find or have the largest opportunities for improvement here from an just from for continued investments? Thanks. Fair point. Stephanie, I'll talk perhaps in broader frameworks here. It's our job to serve our clients, and there are, as you know, multiple types of clients, starting with insurance companies, which still represent the strong majority of the units we sell. For them, they care a lot about speed and execution. They care about auction returns. They care about policyholder experience. On all dimensions, we are investing t here are different nuances to each. I think what you mentioned a moment ago about cycle times and the public notice you mentioned a moment ago about our partnership with Title Express, for example. Those are investments to address cycle times, in particular for cars with outstanding liens on them, which also have derivative effects on the policyholder settlement timelines in some cases. We certainly are investing there. Lienholder cars are, in particular, some of the most challenging vehicles in terms of cycle times, and we invest all the time in initiatives like that. Anyway, the point of all that was there are many dimensions to that, and we invest across those dimensions as well. Great. Thank you so much. Thanks, Stephanie. Thank you. Our next question comes from Bob Labick with CJS Securities. Please proceed with your question. Good morning. Thanks for taking my questions. Hey, Bob. Hi. I wanted to start and dig a little further on the total loss frequency commentary you offered us in the prepared remarks and, you know, as it relates to used car prices and insurance carriers' formulas to total a car. If you had said, you know, two years ago, used car prices would rise 40%, now 60% or 70%, you know, over a two-year period, I would have incorrectly said total loss frequency would crater, unless repair costs went up, you know, equally to offset it. I guess my question is, you know, are repair costs up as much in terms of dollars as used car prices? I can't imagine that's true. Or are insurers adjusting their total loss calculation kind of real time to the current salvage recovery rates that you're getting, or is it something else? 'Cause if it's dynamic, you know, insurance calculations, if they're changing it with used car prices, you know, much faster than they have in the past, would that potentially suggest that as used car prices fall, total loss frequency wouldn't rise as fast as anticipated? If that question makes sense. Yeah, it's a very perceptive question, Bob, as usual. I think your statement is accurate in that total loss frequency I think has been impaired all else equal because of high used car prices. Your question as to then what tips the balance in the other direction, I think it is a combination of repair costs as well as rental car costs. You know, the repair path, so to speak, for an insurance carrier is also onerous and expensive today relative to what it was two years ago. I think there's also just the long-term secular trends in this direction anyway, Bob, as you know, which is the accident detection and avoidance systems and the vehicle complexity, substrate mix change from steel to aluminum and carbon and the like, electric vehicles, et cetera. I think those are all contributing to the net effect that total loss frequency is rising when this one variable in isolation would suggest that it shouldn't. Now, the other variable which is worth mentioning, Bob, is, you know, it's the tension between the two as well in terms of what the used car prices are, but also our auction returns. Our auction returns are up, I think more than pre-accident vehicle prices have been over that same period. We have also helped to close that gap with the auction results as well. Got it. Okay. That's great and very helpful. Just kind of going back to cycle times, and I think in general, you know, that's obviously a benefit and barrier to entry, but you're always trying to improve cycle times and obviously they probably have over the last five, 10 years as well. As cycle times, you know, do improve a little bit, they open up yard capacity. Just curious as to, like, you know, when thinking about your over-capitalized balance sheet and the liquidity that you have, what are the primary uses of that liquidity, you know, as you run out of more land to buy, or if cycle times pick up enough, you know, you need less land at the same time. Just trying to balance those two and ask, I guess, other uses of capital beyond land, because eventually, you know, you won't have to always buy land. Many puts and takes on the question of land. The business is growing, and has been growing for years. That by itself would necessitate more land, not less. Cycle times have improved, but there's plenty of complexity in the ecosystem as well. There are many examples, case studies in which cycle times are increasing. Today, arguably, the very strong used car prices are making lien settlements faster than they otherwise would be r elative to an environment in which you had a bunch of underwater loans, for example, Bob, as you know. Mm-hmm. I think in practice we will continue to invest in land for years to come and probably very substantially so. That said, as you noted, overcapitalized, Bob, is more editorializing perhaps than that I offer. Nonetheless, I think the point that we have a very robust balance sheet today. The answer over the next 10 years is for sure that we'll buy stock back as we always have. You know from our share count, ex the split, that we have contracted the open market share, pardon me, the shares outstanding over the years, and we'll continue to do so. That's a matter of timing in comparison to our relative investment options in land and otherwise. We'll be good stewards of capital and return that via share buybacks at some point. Okay, super. I meant to say well-capitalized, but it slipped out as overcapitalized. Thank you, Bob. I apologize. Thank you. Thanks for answering. I'll jump back in queue. Thanks. Thanks, Bob. Thank you. Our next question comes from Craig Kennison with Baird. Please proceed with your question. Good morning. Thanks for taking my question. Some have already been asked, but I thought I'd shift to Europe. I think you mentioned 8% volume growth, which was slower than what you saw in the U.S., and I think you identified COVID and the response there as a factor. It's also a smaller business with potentially a lot of momentum to it. Could you just comment on maybe the secular shift in that business and whether you still feel like you have momentum with insurance carriers in shifting their practices to your platform? Sure. One technical clarification. When we said the growth rate, that was for our, quote, "international business," which includes Canada, Brazil, the U.K., Finland, Spain, Germany, and the Middle East. It's not just Europe alone. I think yeah, underlying your question, Craig, is what's happening in Spain and Germany and our growth markets in Europe, for example. There we've continued to experience very significant year-over-year growth. We continue to prove the economic model. If anything, the gap between the auction returns we generate at Copart Auctions relative to the listing services we've talked about in the past, that gap is expanding still. The economic proposition, I think, is becoming more compelling, not less. What you're seeing in terms of the overall growth rate is for sure that the U.K., and Canada for that matter, and Brazil in certain areas have been more aggressive about COVID-19 countermeasures than the U.S. has. Thanks. You've had good success in the U.S. with your non-insurance business. Is there a point when your international businesses mature such that you feel comfortable rolling out a service like that as well? Which service now, Craig? I'm talking about non-insurance volumes, especially dealers selling cars on your platform. Yes. To some extent we have. Where we do have liquid auction marketplaces, we do, we have pursued other sources of that volume, including dealers and otherwise, in Canada, in Brazil, in the U.K., and for that matter, the Middle East. In most places we do business, the liquidity comes in a hurry, and the cars that we can sell that extend beyond total loss units from insurance carriers happens pretty quickly as well. Then lastly, I appreciate your commentary on sustainability. You know, clearly your story fits that narrative quite well, and it's nice to hear you articulate it. I'm wondering if the board or you have done any analysis on whether, you know, you are underowned by that group of investors that put ESG as their number one priority. A judgment call tough to make from where we sit, right? I'm not sitting in their rooms and understand their criteria, but certainly from our understanding of what constitutes true sustainability, I think our businesses should be at the very top of that list. I think that's a reasonable conclusion, Craig, but we don't spend a lot of energy with target lists and trying to figure out who should own us and not. We trust that we deliver the results long term, economically and sustainability-wise, and those questions will take care of themselves. That's great. Thanks, Jeff. Thank you. Our next question comes from Daniel Imbro with Stephens. Please proceed with your question. Yeah. Hey, good morning, guys. Thanks for taking our questions. Jeff, I want to start on the non-insurance side of the business. You noted some pretty stark outperformance versus peers. As you're growing into those diverse synergies back to the business, I guess a few questions. One, right now, are you selling all of those dealer cars internationally o r are you actually transacting some maybe U.S. dealer-sourced cars to other dealers in the U.S.? The second question would be, given the reverse synergies and obviously the attractive just unit economics, what are the limiting factors on maybe growing into that faster, as you think about the next three to five years outlook on unit side? Got it. Daniel, to your first question, the latter. The U.S. dealer cars are being sold both to U.S. buyers and international buyers. Both are meaningful portions of the U.S. dealer buyer base. On your second question about the limit, that's. There are dynamic circumstances. As total loss frequency rises, as we win more dealer cars, we then can win more dealer cars. The logic is a little bit circular. Mm-hmm. Are we the absolute sweet spot for a perfectly intact $75,000 Audi today when it comes to liquidity? Perhaps not yet. I'd argue we can achieve a very strong result there too, but there are certainly many cars and an increasing number of cars for which we are the obvious answer. I don't think we are yet the obvious answer for $75,000 Audis, but there's no ceiling per se. Probably the same conceptually, Daniel, when folks ask, what is the ceiling for total loss frequency? Can it get to 25%? Can it get to 30%? I think this is a dynamic picture, and we'll see that evolution over time. There's no reason there's a hard asymptote. That makes sense. I guess, tied to Bob Labick's question earlier, you know, as you think about land capacity, though, you're not feeling right now like you're having a trade-off, like we don't have enough land for continued growth in either dealer or insurance cars. Your land gives you flexibility to pursue both? Correct. The combination of our land and our logistics and our planning is such that we are in position to serve our customers. Perfect. Last question, just wanted to touch on the percentage of vehicles, I think in 10-K last that was filed, that are getting sold overseas. I think we're still kind of in the mid-30s%. That's pretty flat from the year before. I guess where are we. It's a hard question to answer, but in terms of innings, you know, where are we at in terms of opening up new countries to sell into? Are there still larger emerging markets, thinking like India, that you guys aren't selling into today? Maybe could you talk about just what, you know, the steps look like as you enter into these new countries to really start scaling those buyer bases where you're not maybe fully mature today? Oh, I think it's not anywhere close to mature. I think if you compare, and we did this exercise internally some years ago, but if you compare long-term GDP growth rates and have that on one axis, on the other axis have vehicles per capita, the very fastest-growing economies in the world tend to be the ones with the fewest cars, and vice versa. The ones with the slowest-growing economies have the most cars, to say, U.S., Western Europe, Japan, for example. There will be a 50-year trend of more of our used wrecked, damaged vehicles moving overseas, where they are meaningful contributors to economic and physical mobility there. That theme isn't going away anytime soon. As for tactically how we pursue individual countries, we do both. We are responsive when we see activity from countries that previously didn't buy, and we'll invest in online and physical marketing. In some cases, we will invest in physical resources on the ground there as well to cultivate that new buyer base. In some cases, we are simply proactively identifying countries that fit the parameters that obviously country X looks a whole lot like countries Y and Z that already buy a lot. Let's go dip our toe there, proactively, even before we see actual buyer activity. We do both. Got it. That's helpful. Thanks so much, and best of luck. Thank you. Thank you. Our next question comes from Chris Bottiglieri with BNP Paribas. Please proceed with your question. Hey, thanks for taking the question. Just one quick clerical one to start off with. With the revenue impact on the cat, was that roughly like 2% as well in terms of the contribution to revenue? I think you gave volumes. Yes. Directionally, yes. Okay. Gotcha. Okay. I wanted to ask about what you're seeing in terms of, like, towing availability, to what extent that's, you know, become a constraint as, you know, more, you know, brick-and-mortar dealers are going digital and online retailers. That's putting pressure on the system. Like, relatedly, you have, like, a small but growing fleet in the U.S. that's dedicated for cat events. But what do you do with those towing vehicles when you're not in a cat, right? The other 365-4 days of the year. How do you use those towing trucks, you know, in other parts of the year a nd is there any opportunity to expand that to vertically integrate, or is it just not enough scale? How do you think about that trade-off? Yeah. When not deployed, they support our business in markets in which we are facing the most pressure in terms of towing vehicles. So you're right that even when there are not active storms, we make good use of those assets. Medium, long-term, I think there is an opportunity to invest further still here. Historically, we have done very well with the third-party contractor model. They tend to be very resourceful and productive, and it's a good alignment of interest as they want to grow and support their own businesses and to work productively for us b ut that's always an evolving mix and one we continue to evaluate over time. During the catastrophic event and certainly even in afterwards as well, we are certainly happy that we have those trucks and those drivers employed in-house. They have been very productive members of our team. Gotcha. Yeah, thank you. That's helpful. As a reminder, if you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. Thank you. Our next question comes from Bret Jordan with Jefferies. Please proceed with your question. Hey, good morning, guys. Good morning, Bret. On the Ida cars, and I think you called out the 14% U.S. inventory growth. Have most of Ida cars been processed, or are there any that flow into the Q2 that might come with margins but fewer expenses associated with them? Many of those cars, we have not yet sold the majority of the cars, so they are coming in, many of them in the Q2, and some no doubt will. There'll be a tail that takes longer still than that. Okay, you did comment that insurance growth of 23% included both a higher total loss rate as well as share. Could you maybe give us some what was share versus total loss in that growth? No, we don't break that out. Bret, the share commentary, I think as you know, is a long. That comment you can probably find in literally every earnings call. It's been true for a long time. The industry tends to move more slowly in terms of switching providers. Over the very long haul, we have generally speaking grown our share both in the insurance realm and certainly in non-insurance as well. That was true in this quarter, as it was in the past 30 quarters as well. Okay. Then I guess a question sort of a longer term. As you think about the purchase vehicle trend and purchase vehicles up 85%, if you were to think out three to five years, do you see this becoming a business where you are doing a greater percentage of your unit volume on purchased versus service? No, I think the long-term winds of history would suggest we move the other way, that we migrate eventually from principal to a consignment basis. The principal business, for example, in the U.K., when we entered in 2007, it was largely principal-oriented, and today we shifted the strong majority over to a consignment basis instead, which we think is a better long-term alignment of our incentives with those of our sellers, right? As opposed to being principals who trade against them, we are on the same side rooting for the highest possible sale price for those cars. Now, the realms in which we do have more principal activity tend to be places where we are less established as a known brand and a known quantity. Today we are not yet a prominent consumer brand, so it's tough to ask Bret Jordan to consign his car through us and assume that we'll get a good return for you. Instead, we can offer you a compelling price. You sell the car to us, and we sell it in turn as a principal. Ditto in the U.K. in the early days. Today, that's no longer necessary because we certainly are a well-established brand among the insurance industry and otherwise in the U.K. Okay. The point being all long term as liquidity grows, as our recognition grows in those subsections of the marketplace, so to speak, we'll migrate to a consignment model. Okay, great. I guess one final question, just percentage. As you think about the run and drive, what percentage of the cars that you are processing could be put back on the road in these emerging markets? I mean, obviously some are beyond repair, but when you think about, you know, the mix, is it 30% or 40% of cars that you see in theory could be roadworthy again? Of the cars that are exported, I don't know offhand, Bret, so I don't wanna speculate, but it's high. That number doesn't sound unreasonable to me, in part because there's a natural filter, as you might imagine, for the kinds of cars that's even worth putting on a boat to get to Eastern Europe, period. You will filter out the cars that are pure metal content or a couple of recycled parts and then otherwise disposed of. They tend to, by their nature, be the more drivable, repairable cars that would ever leave the country in the first place. Got it. Okay. Thank you. Thanks, Bret. Thank you. Our next question is from Ryan Brinkman with JPMorgan. Please proceed with your question. Hi. Thanks for taking my question. I wanted to ask on what you think are the biggest drivers of your non-insurance volume, in particular the dealer cars, which we know from following KAR Global and ACV are under significant pressure as the chip shortages weighed on new vehicle inventories and therefore new vehicle sales and used vehicle trade-ins. Given your significant outperformance of the trend in dealer cars, I'm curious if you're doing anything differently or have changed your go-to-market strategy, with regard to dealer cars or maybe it's a function of your greater capacity after the land purchases or just, you know, what have been the drivers there and what do you think the longer term potential for dealer cars might be? Sure. Nothing radical in terms of our approach. We have a very capable sales team who approaches those dealers and communicates our value proposition to them, being our global auction liquidity, subjecting your car to a global buyer base and finding the best home for that car, whether it's in Ohio, Florida, Poland or Honduras. I think there's a compelling value proposition there, but there's nothing radical that we had changed in the last quarter or two or three. This is the byproduct of the auction liquidity we talked about a moment ago, as well as our own proactive sales efforts. Okay, thanks. I'm not sure what% of the non-insurance cars you auction are whole cars, as opposed to, like, non-insurance salvage cars. Maybe you can help us with that. Of the whole cars, you know, what% are dealer cars versus from other sources such as off lease, off rental and repossession? Because I think these other, you know, non-dealer whole car categories are down even more than the dealer cars. Just curious what you're seeing there too, and if those other categories are also a potential source of share gain, going forward beyond the opportunity in dealer cars. The answer to your latter question is yes, those are also relevant and addressable for us. All cars, as you well know, are on a spectrum. Even what you define as a salvage versus whole car is a more nuanced matter than simply a binary distinction between the two. We have grown our business very naturally, of course, a rental car company with a car that's slightly damaged or meaningfully damaged. We are absolute obvious home for it. Older car, we're a good and obvious home for it as well. The newer rental cars, those of course are very meaningfully compressed in terms of available industry volume because of the shortage of new cars. The fleets are hanging on to the cars they've got. Yes, long term, those are addressable targets for us as well. Okay, thanks. Just lastly, I wanna follow up on your comment about higher used car prices being a global phenomenon. I found that quite interesting. I'm curious if you could identify any sort of trends that you're seeing in terms of used vehicle inflation by market. I think it is more severe in the U.S. I don't know if you have any ideas as to why that might be or if that's not what you're seeing. Also if used vehicle prices are inflating more in the U.S. than internationally, and the U.S. dollar has somehow outperformed all expectations, hanging in there very strong, rallying recently, you know, how does that impact affordability overseas for these cars? I think of vehicles, with some notable exceptions of the automotive industry as being a reasonably liquid global market, right? I don't think you could see 50% inflation for two-year-old Toyota Corollas in one market and 8% inflation in another, currency adjusted. I do think we have observed increases in used car values around the world in most countries in which we do business. There are sources of friction and distortion, of course, in comparing those trends, whether it's tariffs or shipping or otherwise, that can introduce discontinuities in that comparison. By and large, I think of the vehicle business as being a global one in nature. In terms of the long-term trends, short-term trends, I think we certainly can be affected by currency in any given auction, any given week, any given quarter, maybe even any given year. But I think the long-term trends of our cars being in higher demand in other countries still than they are in the U.S., that's not going away. That over a multiple year horizon will dwarf any currency effects. Very helpful. Thank you. Thank you. Our last question comes from Chris Bottiglieri with BNP Paribas. Please proceed with your question. Hey, guys. Thanks for fitting me back in. Just had a follow-up to Bret's question. Just wanna make sure I heard you correctly. You said the vast majority of the cat cars hadn't been sold yet. Should we expect to see? No, the majority. We've sold a bunch, but the majority have not yet been sold. Gotcha. I mean, are we thinking like if it was one or two point impact this quarter, is it like two or three or is it just much more than that? Any sense? And the margin rate should be similar headwind? Like, how do we think about all that? Yeah, as you know, we don't provide any kind of forward guidance. Those cars will sell. They will generate revenue. They do have costs associated with them. They'll have some variations. We'll talk about it next quarter. Gotcha. Okay. Thank you. Thank you. There are no further questions at this time. I would like to turn the floor back over to Jeff Liaw for any closing comments. Good. Thanks everyone for joining us. We'll talk to you next quarter. Ladies and gentlemen, thank you for your participation. This concludes today's conference. Have a great rest of your day.