AMERCO Reports Second Quarter Fiscal 2014 Financial Results

Nov 06, 2013, 16:20 ET from AMERCO

RENO, Nev., Nov. 6, 2013 /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 common shareholders for its second quarter ended September 30, 2013, of $138 million, or $7.06 per share, compared with net earnings of $109.4 million, or $5.61 per share, for the same period last year.

For the six-month period ended September 30, 2013, net earnings available to common shareholders were $251 million, or $12.84 per share compared with net earnings of $190 million, or $9.74 per share, for the same period last year.

"Our efforts to improve convenience for our customers through the addition of new company operated locations and independent dealers along with an expanded fleet of trucks and trailers has resulted in continued revenue growth," stated Joe Shoen, chairman of AMERCO. 

Highlights of Second Quarter Fiscal 2014 Results

  • Self-moving equipment rental revenues increased $60.6 million or 11% during the second quarter of fiscal 2014, compared with the second quarter of fiscal 2013 on continued growth in moving transactions. Continued expansion of the rental fleet, incremental improvements in utilization and additional retail locations are enabling us to serve more customers.
  • Self-storage revenues increased $7.6 million during the second quarter of fiscal 2014, compared with the second quarter of fiscal 2013. We are increasing both the number of rooms rented through acquisitions and by improving occupancy at existing locations. Over the last twelve months we have added approximately 2.2 million net rentable square feet to our owned self-storage portfolio.
  • Operating earnings at our Moving and Storage operating segment increased $38.3 million in the second quarter of fiscal 2014 compared with the same period last year. Total revenues climbed $96.6 million while being partially offset by a $58.3 million increase in total costs and expenses. The expense increases included personnel, rental equipment maintenance, operating costs associated with the U-Box program, equipment depreciation and commissions on rental equipment transactions.
  • For the first six months of fiscal 2014 compared with the first six months of fiscal 2013 gross truck and trailer capital expenditures were approximately $383 million compared with approximately $331 million, proceeds from sales of rental equipment were $167 million compared with $131 million and spending on real estate related acquisitions and projects increased approximately $84 million to $155 million.
  • Cash and credit availability at the Moving and Storage operating segment was $712.7 million at September 30, 2013 compared with $543.6 million at March 31, 2013. Subsequent to the quarter end, we entered into two new real estate loans totaling $150 million.

AMERCO will hold its investor call for the second quarter of fiscal 2014 on Thursday, November 7, 2013, 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 September 30, 2013, 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 second quarter of fiscal 2014 and 2013.

Quarter Ended September 30,

2013

2012

(Unaudited)

(In thousands)

Revenue:

  Self-moving equipment rentals

$

598,931

$

538,361

  Self-storage revenues

45,572

37,978

  Self-moving and self-storage products and service sales                                             

65,379

61,730

  Property management fees

5,292

4,902

  Life insurance premiums

39,448

47,667

  Property and casualty insurance premiums

10,867

8,947

  Net investment and interest income

19,960

15,853

  Other revenue

51,042

28,679

    Consolidated revenue

$

836,491

$

744,117

 

Listed below are revenues and earnings from operations at each of our operating segments for the second quarter of fiscal 2014 and 2013.

Quarter Ended September 30,

2013

2012

(Unaudited)

(In thousands)

Moving and storage

   Revenues

$

772,199

$

675,569

   Earnings from operations before equity in earnings of subsidiaries

226,109

187,827

Property and casualty insurance

   Revenues

13,330

11,213

   Earnings from operations

6,411

2,342

Life insurance

   Revenues

54,673

58,224

   Earnings from operations

7,542

4,222

Eliminations

  Revenues

(3,711)

(889)

  Earnings from operations before equity in earnings of subsidiaries

(96)

(69)

Consolidated results

  Revenues

836,491

744,117

  Earnings from operations

239,966

194,322

 

The Company owns and manages self-storage facilities. Self-storage revenues reported in the consolidated financial statements represent Company-owned locations only. U-Haul also provides property management services for storage locations and earns a fee for these services. These storage centers are not owned by the Company and therefore are not reported on the balance sheet and the rental revenues are not reported in the statements of operations. Self-storage data for both our owned and managed locations follows:

Quarter Ended September 30,

2013

2012

(Unaudited)

(In thousands, except occupancy rate)

Room count as of September 30

456

435

Square footage as of September 30

40,980

38,818

Average monthly number of rooms occupied

387

359

Average monthly occupancy rate based on room count

85.0%

83.3%

Average monthly square footage occupied

35,455

32,603

 

Listed below on a consolidated basis are revenues for our major product lines for the first six months of fiscal 2014 and 2013.

Six Months Ended September 30,

2013

2012

(Unaudited)

(In thousands)

Revenue:

  Self-moving equipment rentals

$

1,120,580

$

1,005,355

  Self-storage revenues

87,671

72,714

  Self-moving and self-storage products and service sales                                                   

136,070

128,908

  Property management fees

10,453

9,762

  Life insurance premiums

80,510

94,093

  Property and casualty insurance premiums

18,833

16,190

  Net investment and interest income

38,949

30,370

  Other revenue

90,256

54,401

    Total revenues

$

1,583,322

$

1,411,793

 

Listed below are revenues and earnings from operations at each of our operating segments for the first six months of fiscal 2014 and 2013. The insurance companies first six months ended June 30, 2013 and 2012.

Six Months Ended September 30,

2013

2012

(Unaudited)

(In thousands)

Moving and storage

   Revenues

$

1,456,602

$

1,278,418

   Earnings from operations before equity in earnings of subsidiaries

420,117

334,786

Property and casualty insurance

   Revenues

23,773

20,656

   Earnings from operations

10,801

4,929

Life insurance

   Revenues

109,452

114,366

   Earnings from operations

11,602

5,626

Eliminations

  Revenues

(6,505)

(1,647)

  Earnings from operations before equity in earnings of subsidiaries

(178)

(140)

Consolidated results

  Revenues

1,583,322

1,411,793

  Earnings from operations

442,342

345,201

 

The Company owns and manages self-storage facilities. Self-storage revenues reported in the consolidated financial statements represent Company-owned locations only. U-Haul also provides property management services for storage locations and earns a fee for these services. These storage centers are not owned by the Company and therefore are not reported on the balance sheet and the rental revenues are not reported in the statements of operations. Self-storage data for both our owned and managed locations follows:

Six Months Ended September 30,

2013

2012

(Unaudited)

(In thousands, except occupancy rate)

Room count as of September 30

456

435

Square footage as of September 30

40,980

38,818

Average monthly number of rooms occupied

379

350

Average monthly occupancy rate based on room count

83.7%

81.6%

Average monthly square footage occupied

34,668

31,745

 

 

 

AMERCO AND CONSOLIDATED ENTITIES

CONDENSED CONSOLIDATED BALANCE SHEETS

September 30, 2013

March 31, 2013

(Unaudited)

ASSETS

(In thousands)

  Cash and cash equivalents

$

679,576

$

463,744

  Reinsurance recoverables and trade receivables, net

237,235

261,789

  Inventories, net

61,430

56,396

  Prepaid expenses

55,129

57,451

  Investments, fixed maturities and marketable equities

1,114,340

1,095,338

  Investments, other

212,707

241,765

  Deferred policy acquisition costs, net

109,303

93,043

  Other assets

104,591

99,986

  Related party assets

168,830

182,035

2,743,141

2,551,547

  Property, plant and equipment, at cost:

    Land

363,142

333,228

    Buildings and improvements

1,313,963

1,197,875

    Furniture and equipment

311,765

311,142

    Rental trailers and other rental equipment

350,101

317,476

    Rental trucks

2,330,298

2,154,688

4,669,269

4,314,409

  Less: Accumulated depreciation

(1,636,065)

(1,559,355)

    Total property, plant and equipment

3,033,204

2,755,054

  Total assets

$

5,776,345

$

5,306,601

LIABILITIES AND STOCKHOLDERS' EQUITY

Liabilities:

  Accounts payable and accrued expenses

$

362,493

$

358,491

  Notes, loans and leases payable

1,775,119

1,661,845

  Policy benefits and losses, claims and loss expenses payable

1,115,025

1,115,048

  Liabilities from investment contracts

570,321

510,789

  Other policyholders' funds and liabilities

7,788

7,294

  Deferred income

32,388

30,217

  Deferred income taxes

451,392

393,658

Total liabilities

4,314,526

4,077,342

Stockholders' equity:

  Common stock

10,497

10,497

  Additional paid-in capital

440,938

438,168

  Accumulated other comprehensive loss

(44,109)

(22,680)

  Retained earnings

1,733,589

1,482,630

  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

(1,446)

(1,706)

Total stockholders' equity

1,461,819

1,229,259

Total liabilities and stockholders' equity

$

5,776,345

$

5,306,601

 

 

 

AMERCO AND CONSOLIDATED ENTITIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

Quarter Ended September 30,

2013

2012

(Unaudited)

(In thousands, except share and per share data)

Revenues:

  Self-moving equipment rentals

$

598,931

$

538,361

  Self-storage revenues

45,572

37,978

  Self-moving and self-storage products and service sales

65,379

61,730

  Property management fees

5,292

4,902

  Life insurance premiums

39,448

47,667

  Property and casualty insurance premiums

10,867

8,947

  Net investment and interest income

19,960

15,853

  Other revenue

51,042

28,679

    Total revenues

836,491

744,117

Costs and expenses:

  Operating expenses

350,540

310,214

  Commission expenses

78,378

68,564

  Cost of sales

34,532

30,912

  Benefits and losses

37,992

48,472

  Amortization of deferred policy acquisition costs

6,057

3,088

  Lease expense

25,818

29,591

  Depreciation, net of (gains) on disposals of (($9,311) and ($5,532), respectively)

63,208

58,954

    Total costs and expenses

596,525

549,795

Earnings from operations

239,966

194,322

  Interest expense

(23,118)

(22,113)

Pretax earnings

216,848

172,209

  Income tax expense

(78,857)

(62,789)

Earnings available to common shareholders

$

137,991

$

109,420

Basic and diluted earnings per common share

$

7.06

$

5.61

Weighted average common shares outstanding: Basic and diluted

19,554,633

19,512,550

 

 

AMERCO AND CONSOLIDATED ENTITIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

Six Months Ended September 30,

2013

2012

(Unaudited)

(In thousands, except share and per share data)

Revenues:

  Self-moving equipment rentals

$

1,120,580

$

1,005,355

  Self-storage revenues

87,671

72,714

  Self-moving and self-storage products and service sales

136,070

128,908

  Property management fees

10,453

9,762

  Life insurance premiums

80,510

94,093

  Property and casualty insurance premiums

18,833

16,190

  Net investment and interest income

38,949

30,370

  Other revenue

90,256

54,401

    Total revenues

1,583,322

1,411,793

Costs and expenses:

  Operating expenses

660,041

593,607

  Commission expenses

147,005

129,671

  Cost of sales

70,102

63,139

  Benefits and losses

80,625

96,810

  Amortization of deferred policy acquisition costs

9,740

5,899

  Lease expense

52,825

62,387

  Depreciation, net of (gains) on disposals of (($20,876) and ($13,048), respectively)

120,642

115,079

    Total costs and expenses

1,140,980

1,066,592

Earnings from operations

442,342

345,201

  Interest expense

(46,446)

(45,604)

Pretax earnings

395,896

299,597

  Income tax expense

(144,937)

(109,608)

Earnings available to common shareholders

$

250,959

$

189,989

Basic and diluted earnings per common share

$

12.84

$

9.74

Weighted average common shares outstanding: Basic and diluted

19,550,128

19,507,456

 

SOURCE AMERCO



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