AMERCO Reports Second Quarter Fiscal 2016 Financial Results

Nov 04, 2015, 17:32 ET from AMERCO

RENO, Nev., Nov. 4, 2015 /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 second quarter ended September 30, 2015, of $183.4 million, or $9.36 per share, compared with net earnings of $156.2 million, or $7.98 per share, for the same period last year.

For the six-month period ended September 30, 2015, net earnings available to shareholders were $354.7 million, or $18.10 per share, compared with net earnings of $280.7 million, or $14.34 per share, for the same period last year.

"We continued to see revenue growth in all major segments," stated Joe Shoen, chairman of AMERCO. "Competitors continue to assert themselves. We aim to make U-Haul the customer's best choice in both self-move and self-store. I continue to view this as a long journey requiring sustained effort."

Highlights of Second Quarter Fiscal 2016 Results

  • Self-moving equipment rental revenues increased $44.7 million or 7% during the second quarter of fiscal 2016, compared with the second quarter of fiscal 2015. Revenue and transactions from both our In-Town and one-way truck and trailer markets increased compared to the same period last year. During the quarter we continued to add new independent dealers and Company-owned locations to our distribution network.
  • Self-storage revenues increased $9.1 million during the second quarter of fiscal 2016, compared with the second quarter of fiscal 2015. 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 2.7 million net rentable square feet to our owned self-storage portfolio with over 1.3 million of that coming on during the second quarter.
  • Operating earnings at our Moving and Storage operating segment increased $36.6 million in the second quarter of fiscal 2016 compared with the same period last year. Total revenues climbed $52.1 million while being partially offset by a $15.5 million increase in total costs and expenses. Included in this increase was an additional $5.0 million accrual associated with the PEI litigation.
  • For the first six months of fiscal 2016 compared with the first six months of fiscal 2015 gross truck and trailer capital expenditures were approximately $426 million compared with approximately $536 million, proceeds from sales of rental equipment were $376 million compared with $259 million and spending on real estate related acquisitions and projects increased approximately $95 million to $276 million.
  • Cash and credit availability at the Moving and Storage operating segment was $981.6 million at September 30, 2015 compared with $561.9 million at March 31, 2015.
  • On August 28, 2015, we declared a cash dividend on our Common Stock of $3.00 per share to holders of record on September 16, 2015. The dividend was paid on October 2, 2015.

AMERCO will hold its investor call for the second quarter of fiscal 2016 on Thursday, November 5, 2015, 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, 2015, 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 2016 and 2015.

Quarter Ended September 30,

2015

2014

(Unaudited)

(In thousands)

 Self-moving equipment rentals

$

698,219

$

653,534

 Self-storage revenues

62,060

52,986

 Self-moving and self-storage product and service sales

70,703

68,043

 Property management fees

6,320

5,796

 Life insurance premiums

40,515

39,041

 Property and casualty insurance premiums

13,372

12,463

 Net investment and interest income

22,151

21,856

 Other revenue

49,563

52,772

 Consolidated revenue

$

962,903

$

906,491

Listed below are revenues and earnings from operations at each of our operating segments for the second quarter of fiscal 2016 and 2015.

Quarter Ended September 30,

2015

2014

(Unaudited)

(In thousands)

 Moving and storage

 Revenues

888,294

836,145

 Earnings from operations before equity in earnings of subsidiaries

297,106

260,496

 Property and casualty insurance  

 Revenues

16,625

16,531

 Earnings from operations

6,065

6,972

 Life insurance   

 Revenues

59,187

55,123

 Earnings from operations

8,057

8,531

 Eliminations

 Revenues

(1,203)

(1,308)

 Earnings from operations before equity in earnings of subsidiaries

(160)

(163)

 Consolidated Results

 Revenues

962,903

906,491

 Earnings from operations

311,068

275,836

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 September 30,

2015

2014

(Unaudited)

(In thousands, except occupancy rate)

Room count as of September 30

252

219

Square footage as of September 30

22,023

19,314

Average monthly number of rooms occupied

205

182

Average monthly occupancy rate based on room count

84.0%

84.1%

Average monthly square footage occupied

18,364

16,252

Listed below on a consolidated basis are revenues for our major product lines for the first six months of fiscal 2016 and 2015.

Six Months Ended September 30,

2015

2014

(Unaudited)

(In thousands)

 Self-moving equipment rentals

$

1,327,505

$

1,229,009

 Self-storage revenues

119,251

102,120

 Self-moving and self-storage product and service sales

147,961

142,522

 Property management fees

12,431

11,473

 Life insurance premiums

80,781

76,971

 Property and casualty insurance premiums

23,928

22,081

 Net investment and interest income

44,123

42,902

 Other revenue

91,728

98,368

 Consolidated revenue

$

1,847,708

$

1,725,446

Listed below are revenues and earnings from operations at each of our operating segments for the first six months of fiscal 2016 and 2015.

Six Months Ended September 30,

2015

2014

(Unaudited)

(In thousands)

 Moving and storage

 Revenues

$

1,703,134

$

1,591,066

 Earnings from operations before equity in earnings of subsidiaries

577,685

471,253

 Property and casualty insurance  

 Revenues

31,515

28,943

 Earnings from operations

12,543

10,994

 Life insurance   

 Revenues

115,256

107,743

 Earnings from operations

12,268

13,106

 Eliminations

 Revenues

(2,197)

(2,306)

 Earnings from operations before equity in earnings of subsidiaries

(320)

(318)

 Consolidated Results

 Revenues

1,847,708

1,725,446

 Earnings from operations

602,176

495,035

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:

Six Months Ended September 30,

2015

2014

(Unaudited)

(In thousands, except occupancy rate)

Room count as of September 30

252

219

Square footage as of September 30

22,023

19,314

Average monthly number of rooms occupied

200

178

Average monthly occupancy rate based on room count

83.2%

83.2%

Average monthly square footage occupied

17,849

15,794

 

AMERCO AND CONSOLIDATED ENTITIES

CONDENSED CONSOLIDATED BALANCE SHEETS

September 30,

March 31,

2015

2015

(Unaudited)

(In thousands)

ASSETS

Cash and cash equivalents

$

961,647

$

441,850

Reinsurance recoverables and trade receivables, net

176,128

189,869

Inventories, net

72,022

69,472

Prepaid expenses

51,961

126,296

Investments, fixed maturities and marketable equities

1,360,780

1,304,962

Investments, other

330,233

268,720

Deferred policy acquisition costs, net

125,052

115,422

Other assets

93,508

106,157

Related party assets

83,917

141,790

3,255,248

2,764,538

Property, plant and equipment, at cost:

Land

521,964

467,482

Buildings and improvements

1,930,042

1,728,033

Furniture and equipment

370,557

355,349

Rental trailers and other rental equipment

458,472

436,642

Rental trucks

3,085,800

3,059,987

6,366,835

6,047,493

Less: Accumulated depreciation

(2,021,538)

(1,939,856)

Total property, plant and equipment

4,345,297

4,107,637

Total assets

$

7,600,545

$

6,872,175

LIABILITIES AND STOCKHOLDERS' EQUITY

Liabilities:

Accounts payable and accrued expenses

$

508,453

$

496,370

Notes, loans and leases payable

2,483,190

2,190,869

Policy benefits and losses, claims and loss expenses payable

1,072,884

1,062,188

Liabilities from investment contracts

810,474

685,745

Other policyholders' funds and liabilities

11,683

7,764

Deferred income

20,333

18,081

Deferred income taxes

549,910

526,799

Total liabilities

5,456,927

4,987,816

Common stock

10,497

10,497

Additional paid-in capital

450,830

449,668

Accumulated other comprehensive loss

(55,706)

(34,365)

Retained earnings

2,418,890

2,142,600

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

(3,243)

(6,391)

Total stockholders' equity

2,143,618

1,884,359

Total liabilities and stockholders' equity

$

7,600,545

$

6,872,175

 

AMERCO AND CONSOLIDATED ENTITIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

Quarter Ended September 30,

2015

2014

(Unaudited)

(In thousands, except share and per share data)

Revenues:

Self-moving equipment rentals

$

698,219

$

653,534

Self-storage revenues

62,060

52,986

Self-moving and self-storage products and service sales

70,703

68,043

Property management fees

6,320

5,796

Life insurance premiums

40,515

39,041

Property and casualty insurance premiums

13,372

12,463

Net investment and interest income

22,151

21,856

Other revenue

49,563

52,772

Total revenues

962,903

906,491

Costs and expenses:

Operating expenses

406,282

383,970

Commission expenses

80,799

76,160

Cost of sales

39,881

39,836

Benefits and losses

43,428

39,558

Amortization of deferred policy acquisition costs

5,643

4,290

Lease expense

12,724

19,775

Depreciation, net of (gains) losses on disposals

63,078

67,066

Total costs and expenses

651,835

630,655

Earnings from operations

311,068

275,836

Interest expense

(23,973)

(24,877)

Fees and amortization on early extinguishment of debt

-

(4,081)

Pretax earnings

287,095

246,878

Income tax expense

(103,716)

(90,631)

Earnings available to common shareholders

$

183,379

$

156,247

Basic and diluted earnings per common share

$

9.36

$

7.98

Weighted average common shares outstanding: Basic and diluted

19,597,717

19,584,194

 

AMERCO AND CONSOLIDATED ENTITIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

Six Months Ended September 30,

2015

2014

(Unaudited)

(In thousands, except share and per share data)

Revenues:

Self-moving equipment rentals

$

1,327,505

$

1,229,009

Self-storage revenues

119,251

102,120

Self-moving and self-storage products and service sales

147,961

142,522

Property management fees

12,431

11,473

Life insurance premiums

80,781

76,971

Property and casualty insurance premiums

23,928

22,081

Net investment and interest income

44,123

42,902

Other revenue

91,728

98,368

Total revenues

1,847,708

1,725,446

Costs and expenses:

Operating expenses

769,451

747,269

Commission expenses

153,857

142,500

Cost of sales

81,136

81,464

Benefits and losses

86,819

80,342

Amortization of deferred policy acquisition costs

10,421

8,474

Lease expense

29,788

42,245

Depreciation, net of (gains) losses on disposals

114,060

128,117

Total costs and expenses

1,245,532

1,230,411

Earnings from operations

602,176

495,035

Interest expense

(46,073)

(49,025)

Fees and amortization on early extinguishment of debt

-

(4,081)

Pretax earnings

556,103

441,929

Income tax expense

(201,439)

(161,208)

Earnings available to common shareholders

$

354,664

$

280,721

Basic and diluted earnings per common share

$

18.10

$

14.34

Weighted average common shares outstanding: Basic and diluted

19,596,921

19,580,997

 

SOURCE AMERCO



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