AMERCO Reports Third Quarter Fiscal 2021 Financial Results
RENO, Nev., Feb. 3, 2021 /PRNewswire/ -- AMERCO (Nasdaq: UHAL), parent of U-Haul International, Inc., Oxford Life Insurance Company, Repwest Insurance Company and Amerco Real Estate Company, today reported net earnings available to shareholders for its third quarter ended December 31, 2020, of $183.0 million, or $9.33 per share, compared with net earnings of $30.9 million, or $1.58 per share, for the same period last year.
For the nine-month period ended December 31, 2020, net earnings available to shareholders were $537.1 million, or $27.39 per share, compared with net earnings of $319.7 million, or $16.31 per share, for the same period last year.
"Our investments over the past few years have positioned us to serve new and existing moving and self-storage customers during a time when the public has particularly needed U-Haul," stated Joe Shoen, chairman of AMERCO. "Most of our marketplaces are very competitive. Our team must keep its eye on the ball to meet current demand and build for the future."
Highlights of Third Quarter Fiscal 2021 Results
- Self-moving equipment rental revenues increased $186.7 million or 30% during the third quarter of fiscal 2021, compared with the third quarter of fiscal 2020. Transactions along with average revenue per transaction increased for both our In-town and one-way markets. During the quarter, we experienced an increase in the volume of our Corporate Account business. Compared with the same period last year, we increased the number of retail locations, independent dealers, box trucks and trailers in the rental fleet.
- Self-storage revenues increased $16.3 million, or 15% during the third quarter of fiscal 2021, compared with the third quarter of fiscal 2020. The average monthly number of occupied units increased by 20%, or 65,000 units, during the third quarter of fiscal 2021 compared with the same period last year. The growth in revenues and square feet rented comes from a combination of occupancy gains at existing locations and from the addition of new capacity to the portfolio. Over the last twelve months, we added approximately 4.1 million net rentable square feet, or a 10% increase, with approximately 1.0 million of that coming on during the third quarter of fiscal 2021.
- Sales of self-moving and self-storage products and services increased $20.1 million, or 37% compared with the third quarter of fiscal 2021 due to increased sales of hitches, moving supplies and propane.
- For the third quarter of fiscal 2021 compared with the third quarter of fiscal 2020, depreciation, net of gains and losses on sales decreased $17.5 million. Depreciation expense on the rental equipment fleet decreased $9.5 million as new truck production has been slowed by COVID-19 related production delays earlier this year, while net gains on the disposal of rental equipment increased $13.1 million from higher resale values. All other depreciation increased $5.1 million due primarily to the increase in new moving and storage locations.
- For the first nine months of fiscal 2021 and fiscal 2020, gross truck and trailer capital expenditures totaled approximately $541 million compared with $1,161 million, proceeds from the sales of rental equipment totaled $430 million compared with $591 million and spending on real estate related acquisitions and projects totaled approximately $365 million compared with $600 million, respectively.
- Fleet maintenance and repair costs increased $2.9 million in the third quarter of fiscal 2021 compared with the same period last year.
- Operating earnings at our Moving and Storage operating segment increased $202.2 million in the third quarter of fiscal 2021 compared with the same period last year. Total revenues increased $238.9 million and total costs and expenses increased $36.7 million.
- Cash and credit availability at the Moving and Storage operating segment was $1,343.3 million at December 31, 2020 compared with $498.1 million at March 31, 2020.
- On December 9, 2020, we declared a cash dividend on our Common Stock of $2.00 per share to holders of record on December 21, 2020. The dividend was paid on December 30, 2020.
AMERCO will hold its investor call for the third quarter of fiscal 2021 on Thursday, February 4, 2021, at 8 a.m. Arizona Time (10 a.m. Eastern). The call will be broadcast live over the Internet at www.amerco.com. To hear a simulcast of the call, or a replay, visit www.amerco.com.
About AMERCO
AMERCO is the parent company of U-Haul International, Inc., Oxford Life Insurance Company, Repwest Insurance Company and Amerco Real Estate Company. U-Haul is in the shared use business and was founded on the fundamental philosophy that the division of use and specialization of ownership is good for both U-Haul customers and the environment.
Certain of the statements made in this press release regarding our business constitute forward-looking statements as contemplated under the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those anticipated as a result of various risks and uncertainties. Readers are cautioned not to place undue reliance on these forward-looking statements that speak only as of the date hereof. The Company undertakes no obligation to publish revised forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events, except as required by law. For a brief discussion of the risks and uncertainties that may affect AMERCO's business and future operating results, please refer to our Form 10-Q for the quarter ended December 31, 2020, which is on file with the SEC.
Report on Business Operations
Listed below on a consolidated basis are revenues for our major product lines for the third quarter of fiscal 2021 and 2020.
Quarter Ended December 31, |
||||
2020 |
2019 |
|||
(Unaudited) |
||||
(In thousands) |
||||
Self-moving equipment rentals |
$ |
808,215 |
$ |
621,471 |
Self-storage revenues |
123,024 |
106,701 |
||
Self-moving and self-storage product and service sales |
74,586 |
54,454 |
||
Property management fees |
8,765 |
9,098 |
||
Life insurance premiums |
29,993 |
31,164 |
||
Property and casualty insurance premiums |
19,933 |
19,267 |
||
Net investment and interest income |
35,580 |
33,782 |
||
Other revenue |
69,886 |
51,943 |
||
Consolidated revenue |
$ |
1,169,982 |
$ |
927,880 |
Listed below are revenues and earnings from operations at each of our operating segments for the third quarter of fiscal 2021 and 2020.
Quarter Ended December 31, |
||||
2020 |
2019 |
|||
(Unaudited) |
||||
(In thousands) |
||||
Moving and storage |
||||
Revenues |
$ |
1,085,281 |
$ |
846,364 |
Earnings from operations before equity in earnings of subsidiaries |
264,004 |
61,769 |
||
Property and casualty insurance |
||||
Revenues |
26,640 |
25,366 |
||
Earnings from operations |
11,491 |
9,884 |
||
Life insurance |
||||
Revenues |
61,077 |
58,889 |
||
Earnings from operations |
8,724 |
9,190 |
||
Eliminations |
||||
Revenues |
(3,016) |
(2,739) |
||
Earnings from operations before equity in earnings of subsidiaries |
(273) |
(278) |
||
Consolidated Results |
||||
Revenues |
1,169,982 |
927,880 |
||
Earnings from operations |
283,946 |
80,565 |
||
The Company owns and manages self-storage facilities. Self-storage revenues reported in the consolidated financial statements represent Company-owned locations only. Self-storage data for our owned locations follows:
Quarter Ended December 31, |
||||
2020 |
2019 |
|||
(Unaudited) |
||||
(In thousands, except occupancy rate) |
||||
Unit count as of December 31 |
532 |
487 |
||
Square footage as of December 31 |
44,948 |
40,835 |
||
Average monthly number of units occupied |
388 |
323 |
||
Average monthly occupancy rate based on unit count |
73.4% |
66.9% |
||
Average monthly square footage occupied |
34,802 |
29,318 |
||
Listed below on a consolidated basis are revenues for our major product lines for the first nine months of fiscal 2021 and 2020.
Nine Months Ended December 31, |
||||
2020 |
2019 |
|||
(Unaudited) |
||||
(In thousands) |
||||
Self-moving equipment rentals |
$ |
2,393,530 |
$ |
2,174,392 |
Self-storage revenues |
347,252 |
309,940 |
||
Self-moving and self-storage product and service sales |
264,564 |
207,601 |
||
Property management fees |
23,952 |
23,487 |
||
Life insurance premiums |
91,958 |
96,229 |
||
Property and casualty insurance premiums |
49,536 |
51,056 |
||
Net investment and interest income |
85,895 |
102,629 |
||
Other revenue |
225,440 |
192,009 |
||
Consolidated revenue |
$ |
3,482,127 |
$ |
3,157,343 |
Listed below are revenues and earnings from operations at each of our operating segments for the first nine months of fiscal 2021 and 2020.
Nine Months Ended December 31, |
||||
2020 |
2019 |
|||
(Unaudited) |
||||
(In thousands) |
||||
Moving and storage |
||||
Revenues |
$ |
3,256,899 |
2,916,314 |
|
Earnings from operations before equity in earnings of subsidiaries |
789,621 |
492,652 |
||
Property and casualty insurance |
||||
Revenues |
62,947 |
69,199 |
||
Earnings from operations |
24,338 |
27,442 |
||
Life insurance |
||||
Revenues |
170,290 |
179,069 |
||
Earnings from operations |
16,684 |
19,912 |
||
Eliminations |
||||
Revenues |
(8,009) |
(7,239) |
||
Earnings from operations before equity in earnings of subsidiaries |
(821) |
(836) |
||
Consolidated Results |
||||
Revenues |
3,482,127 |
3,157,343 |
||
Earnings from operations |
829,822 |
539,170 |
||
The Company owns and manages self-storage facilities. Self-storage revenues reported in the consolidated financial statements represent Company-owned locations only. Self-storage data for our owned locations follows:
Nine Months Ended December 31, |
||||
2020 |
2019 |
|||
(Unaudited) |
||||
(In thousands, except occupancy rate) |
||||
Unit count as of December 31 |
532 |
487 |
||
Square footage as of December 31 |
44,948 |
40,835 |
||
Average monthly number of units occupied |
369 |
316 |
||
Average monthly occupancy rate based on unit count |
71.0% |
68.2% |
||
Average monthly square footage occupied |
33,036 |
28,646 |
||
AMERCO AND CONSOLIDATED ENTITIES CONDENSED CONSOLIDATED BALANCE SHEETS |
||||
December 31, |
March 31, |
|||
2020 |
2020 |
|||
(Unaudited) |
||||
(In thousands) |
||||
ASSETS |
||||
Cash and cash equivalents |
$ |
1,398,840 |
$ |
494,352 |
Reinsurance recoverables and trade receivables, net |
224,447 |
186,672 |
||
Inventories and parts, net |
104,180 |
101,083 |
||
Prepaid expenses |
450,889 |
562,904 |
||
Investments, fixed maturities and marketable equities |
2,606,953 |
2,492,738 |
||
Investments, other |
447,902 |
360,373 |
||
Deferred policy acquisition costs, net |
92,139 |
103,118 |
||
Other assets |
44,261 |
71,956 |
||
Right of use assets – financing, net |
920,321 |
1,080,353 |
||
Right of use assets - operating |
97,186 |
106,631 |
||
Related party assets |
34,963 |
34,784 |
||
6,422,081 |
5,594,964 |
|||
Property, plant and equipment, at cost: |
||||
Land |
1,059,177 |
1,032,945 |
||
Buildings and improvements |
4,996,900 |
4,663,461 |
||
Furniture and equipment |
778,732 |
752,363 |
||
Rental trailers and other rental equipment |
552,892 |
511,520 |
||
Rental trucks |
3,629,888 |
3,595,933 |
||
11,017,589 |
10,556,222 |
|||
Less: Accumulated depreciation |
(2,992,365) |
(2,713,162) |
||
Total property, plant and equipment, net |
8,025,224 |
7,843,060 |
||
Total assets |
$ |
14,447,305 |
$ |
13,438,024 |
LIABILITIES AND STOCKHOLDERS' EQUITY |
||||
Liabilities: |
||||
Accounts payable and accrued expenses |
$ |
608,765 |
$ |
554,353 |
Notes, loans and finance/capital leases payable, net |
4,678,227 |
4,621,291 |
||
Operating lease liability |
97,224 |
106,443 |
||
Policy benefits and losses, claims and loss expenses payable |
1,013,582 |
997,647 |
||
Liabilities from investment contracts |
1,997,936 |
1,802,217 |
||
Other policyholders' funds and liabilities |
34,867 |
10,190 |
||
Deferred income |
37,005 |
31,620 |
||
Deferred income taxes, net |
1,222,544 |
1,093,543 |
||
Total liabilities |
9,690,150 |
9,217,304 |
||
Common stock |
10,497 |
10,497 |
||
Additional paid-in capital |
453,819 |
453,819 |
||
Accumulated other comprehensive income |
85,910 |
34,652 |
||
Retained earnings |
4,884,579 |
4,399,402 |
||
Cost of common shares in treasury, net |
(525,653) |
(525,653) |
||
Cost of preferred shares in treasury, net |
(151,997) |
(151,997) |
||
Unearned employee stock ownership plan shares |
- |
- |
||
Total stockholders' equity |
4,757,155 |
4,220,720 |
||
Total liabilities and stockholders' equity |
$ |
14,447,305 |
$ |
13,438,024 |
AMERCO AND CONSOLIDATED ENTITIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS |
||||
Quarter Ended December 31, |
||||
2020 |
2019 |
|||
(Unaudited) |
||||
(In thousands, except share and per share data) |
||||
Revenues: |
||||
Self-moving equipment rentals |
$ |
808,215 |
$ |
621,471 |
Self-storage revenues |
123,024 |
106,701 |
||
Self-moving and self-storage products and service sales |
74,586 |
54,454 |
||
Property management fees |
8,765 |
9,098 |
||
Life insurance premiums |
29,993 |
31,164 |
||
Property and casualty insurance premiums |
19,933 |
19,267 |
||
Net investment and interest income |
35,580 |
33,782 |
||
Other revenue |
69,886 |
51,943 |
||
Total revenues |
1,169,982 |
927,880 |
||
Costs and expenses: |
||||
Operating expenses |
539,942 |
517,453 |
||
Commission expenses |
86,891 |
66,542 |
||
Cost of sales |
45,752 |
35,318 |
||
Benefits and losses |
45,631 |
42,864 |
||
Amortization of deferred policy acquisition costs |
6,572 |
8,046 |
||
Lease expense |
7,522 |
6,490 |
||
Depreciation, net of (gains)/losses on disposal |
152,602 |
170,074 |
||
Net losses on disposal of real estate |
1,124 |
528 |
||
Total costs and expenses |
886,036 |
847,315 |
||
Earnings from operations |
283,946 |
80,565 |
||
Other components of net periodic benefit costs |
(247) |
(263) |
||
Interest expense |
(42,128) |
(39,973) |
||
Pretax earnings |
241,571 |
40,329 |
||
Income tax expense |
(58,586) |
(9,397) |
||
Earnings available to common shareholders |
$ |
182,985 |
$ |
30,932 |
Basic and diluted earnings per common share |
$ |
9.33 |
$ |
1.58 |
Weighted average common shares outstanding: Basic and diluted |
19,607,788 |
19,607,788 |
||
AMERCO AND CONSOLIDATED ENTITIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS |
||||
Nine Months Ended December 31, |
||||
2020 |
2019 |
|||
(Unaudited) |
||||
(In thousands, except share and per share data) |
||||
Revenues: |
||||
Self-moving equipment rentals |
$ |
2,393,530 |
$ |
2,174,392 |
Self-storage revenues |
347,252 |
309,940 |
||
Self-moving and self-storage products and service sales |
264,564 |
207,601 |
||
Property management fees |
23,952 |
23,487 |
||
Life insurance premiums |
91,958 |
96,229 |
||
Property and casualty insurance premiums |
49,536 |
51,056 |
||
Net investment and interest income |
85,895 |
102,629 |
||
Other revenue |
225,440 |
192,009 |
||
Total revenues |
3,482,127 |
3,157,343 |
||
Costs and expenses: |
||||
Operating expenses |
1,606,687 |
1,617,338 |
||
Commission expenses |
255,431 |
233,540 |
||
Cost of sales |
159,516 |
128,177 |
||
Benefits and losses |
130,660 |
137,695 |
||
Amortization of deferred policy acquisition costs |
19,012 |
20,625 |
||
Lease expense |
20,995 |
19,882 |
||
Depreciation, net of gains on disposal |
455,711 |
462,227 |
||
Net (gains) losses on disposal of real estate |
4,293 |
(1,311) |
||
Total costs and expenses |
2,652,305 |
2,618,173 |
||
Earnings from operations |
829,822 |
539,170 |
||
Other components of net periodic benefit costs |
(740) |
(790) |
||
Interest expense |
(122,174) |
(117,983) |
||
Pretax earnings |
706,908 |
420,397 |
||
Income tax expense |
(169,832) |
(100,717) |
||
Earnings available to common shareholders |
$ |
537,076 |
$ |
319,680 |
Basic and diluted earnings per common share |
$ |
27.39 |
$ |
16.31 |
Weighted average common shares outstanding: Basic and diluted |
19,607,788 |
19,602,484 |
||
NON-GAAP FINANCIAL RECONCILIATION SCHEDULE
As of April 1, 2019, we adopted the new accounting standard for leases. Part of this adoption resulted in approximately $1 billion of property, plant and equipment, net ("PPE") being reclassed to Right of use assets - financing, net ("ROU-financing"). As of December 31, 2020, the balance of ROU-financing also includes the rental equipment purchased under new financing liability leases during the first nine months of fiscal 2021. The table below shows adjusted PPE as of December 31, 2020 and March 31, 2020, by including the ROU-financing. The assets included in the ROU-financing is not a true book value as some of the assets are recorded at between 70% and 100% of value based on the lease agreement.
December 31, |
March 31, |
||||||||
2020 |
2020 |
||||||||
December 31, |
ROU Assets |
Property, Plant |
Property, |
||||||
2020 |
Financing |
Adjusted |
Adjusted |
||||||
(Unaudited) |
|||||||||
(In thousands) |
|||||||||
Property, plant and equipment, at cost |
|||||||||
Land |
$ |
1,059,177 |
$ |
- |
$ |
1,059,177 |
$ |
1,032,945 |
|
Buildings and improvements |
4,996,900 |
- |
4,996,900 |
4,663,461 |
|||||
Furniture and equipment |
778,732 |
20,966 |
799,698 |
773,476 |
|||||
Rental trailers and other rental equipment |
552,892 |
106,961 |
659,853 |
627,592 |
|||||
Rental trucks |
3,629,888 |
1,614,194 |
5,244,082 |
5,334,014 |
|||||
Subtotal |
11,017,589 |
1,742,121 |
12,759,710 |
12,431,488 |
|||||
Less: Accumulated depreciation |
(2,992,365) |
(821,800) |
(3,814,165) |
(3,508,075) |
|||||
Total property, plant and equipment, net |
$ |
8,025,224 |
$ |
920,321 |
$ |
8,945,545 |
$ |
8,923,413 |
|
SOURCE AMERCO
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