AMERCO Reports Third Quarter Fiscal 2013 Financial Results

RENO, Nev., Feb. 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 third quarter ended December 31, 2012, of $36.8 million, or $1.89 per share, compared with $0.7 million, or $0.04 per share, for the same period last year.  Included in the results for December 31, 2011, was an after-tax charge of $1.61 per share associated with Repwest's excess workers' compensation reserve strengthening.  Taking into account this after-tax charge, adjusted earnings were $1.65 per share for the three months ended December 31, 2011.

For the nine-month period ended December 31, 2012, net earnings available to common shareholders were $226.8 million, or $11.62 per share, compared with net earnings of $171.1 million, or $8.79 per share for the same period last year.  Included in the results for December 31, 2011, was the after-tax charge of $1.61 per share associated with Repwest's excess workers' compensation reserve strengthening. Taking into account this after-tax charge, adjusted earnings were $10.40 per share for the nine months ended December 31, 2011. The first nine months of the last fiscal year also included a $0.30 per share one time charge related to the redemption of our Series A 8½% Preferred Stock.

"We continue to perform well with each of our segments reporting improvements for the quarter," stated Joe Shoen, chairman of AMERCO. "Mild winter weather in most of the country has contributed to strong performance in our U-Move segment," concluded Shoen.

Highlights of Third-Quarter Fiscal 2013 Results

  • Self-moving equipment rental revenues increased $19.2 million during the third quarter of fiscal 2013 compared with the third quarter of fiscal 2012 led by continued transaction growth.  While Hurricane Sandy affected portions of our operations in the Northeast United States, we believe the overall effect on revenues was immaterial.
  • Self-storage revenues increased $5.3 million during the third quarter of fiscal 2013, compared with the third quarter of fiscal 2012.  The increase was due to our expansion efforts combined with occupancy improvement at existing locations.  Average monthly occupancy during the third quarter of fiscal 2013 increased by 1.8 million square feet compared to the same period last year.  Over the last twelve months we have added approximately 2.1 million net rentable square feet with nearly 0.8 million of that during the third quarter of fiscal 2013.
  • Operating earnings at the Life Insurance segment increased $0.6 million during the third quarter of fiscal 2013, compared with the third quarter of fiscal 2012.  During the third quarter of fiscal 2012 we acquired a block of life insurance policies resulting in an $83.4 million one-time increase in premiums and a similar increase in benefits expense; the third quarter of fiscal 2013 did not include a similar acquisition.  New annuity deposits from customers increased $81.1 million compared to the same quarter last year as the focus of new sales has shifted from life products to fixed rate deferred annuities.
  • Operating earnings at the Property and Casualty Insurance segment increased $45.5 million for the third quarter of fiscal 2013, compared with the third quarter of fiscal 2012.  The third quarter of fiscal 2012 included $48.0 million of charges related to excess workers' compensation reserves and reinsurance contracts; these charges did not recur in fiscal 2013.
  • In the third quarter of fiscal 2013, the Company paid a special cash dividend of $5.00 per share on its common stock resulting in a $97.4 million cash outflow.  At December 31, 2012 cash and credit availability at the Moving and Storage operating segment was $841.6 million, compared with $628.2 million at March 31, 2012.

AMERCO will hold its investor call for the third quarter of fiscal 2013 on Thursday, February 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

Use of Non-GAAP Financial Information
The Company reports its financial results in accordance with generally accepted accounting principles (GAAP). However, the Company uses certain non-GAAP performance measures, including adjusted earnings per share, to provide a better understanding of the Company's underlying operational results. The Company uses adjusted earnings per share to present the impact of certain transactions or events that management expects to occur only infrequently.

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, 2012, 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 2013 and 2012.


Quarter Ended

December 31,


2012


2011


(Unaudited)


(In thousands)



  Self-moving equipment rentals

$

394,945

$

375,744

  Self-storage revenues


39,111


33,846

  Self-moving and self-storage products and services sales                                           


44,491


43,206

  Property management fees


6,085


5,368

  Life insurance premiums


43,248


132,643

  Property and casualty insurance premiums


9,816


9,429

  Net investment and interest income


18,927


15,234

  Other revenue


22,188


17,619

    Consolidated revenue

$

578,811

$

633,089







Listed below are revenues and earnings (loss) from operations at each of our operating segments for the third quarter of fiscal 2013 and 2012.


Quarter Ended

December 31,


2012


2011


(Unaudited)


(In thousands)

Moving and storage


   Revenues

$

514,806

$

483,066

   Earnings from operations before equity in earnings of subsidiaries


72,781


61,766

Property and casualty insurance





   Revenues


11,865


11,666

   Earnings (loss) from operations


2,062


(43,444)

Life insurance





   Revenues


53,090


139,643

   Earnings from operations


7,181


6,599

Eliminations





  Revenues


(950)


(1,286)

 Earnings from operations before equity in earnings of subsidiaries


(78)


(48)

Consolidated results





  Revenues


578,811


633,089

  Earnings from operations


81,946


24,873

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

December 31,


2012


2011


(Unaudited)


(In thousands, except
occupancy rate)

Room count as of December 31

441


420

Square footage as of December 31

39,575


37,464

Average number of rooms occupied

354


329

Average occupancy rate based on room count

80.6%


78.5%

Average square footage occupied

32,356


29,879






Listed below on a consolidated basis are revenues for our major product lines for the first nine months of fiscal 2013 and 2012.


Nine Months Ended

December 31,


2012


2011


(Unaudited)


(In thousands)


  Self-moving equipment rentals

$

1,400,300

$

1,333,918

  Self-storage revenues


111,825


99,682

  Self-moving and self-storage products and service sales


173,399


167,352

  Property management fees


15,847


14,929

  Life insurance premiums


137,341


229,839

  Property and casualty insurance premiums


26,006


25,076

  Net investment and interest income


44,237


48,398

  Other revenue


76,589


60,041

    Consolidated revenue

$

1,985,544

$

1,979,235

Listed below are revenues and earnings (loss) from operations at each of our operating segments for the first nine months of fiscal 2013 and 2012.


Nine Months Ended

December 31,


2012


2011



(Unaudited)



(In thousands)

Moving and storage





   Revenues

$

1,793,224

$

1,697,683

   Earnings from operations before equity in earnings of subsidiaries


407,567


383,072

Property and casualty insurance





   Revenues


32,521


32,471

   Earnings (loss) from operations


6,991


(39,348)

Life insurance





   Revenues


162,396


252,834

   Earnings from operations


12,807


14,430

Eliminations





  Revenues


(2,597)


(3,753)

 Earnings from operations before equity in earnings of subsidiaries


(218)


(485)

Consolidated results





  Revenues


1,985,544


1,979,235

  Earnings from operations


427,147


357,669







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:


Nine Months Ended

December 31,


2012


2011


(Unaudited)


(In thousands, except
occupancy rate)

Room count as of December 31

441


420

Square footage as of December 31

39,575


37,464

Average number of rooms occupied

351


330

Average occupancy rate based on room count

81.3%


79.3%

Average square footage occupied

31,949


29,990






 

 

 


AMERCO AND CONSOLIDATED ENTITIES

CONDENSED CONSOLIDATED BALANCE SHEETS




December 31,



March 31,


2012



2012


(Unaudited)





(In thousands, except share data)

ASSETS





Cash and cash equivalents

$

586,124

$

357,180

Reinsurance recoverables and trade receivables, net


226,340


297,974

Inventories, net


55,989


58,735

Prepaid expenses


55,148


41,858

Investments, fixed maturities and marketable equities


1,019,968


766,792

Investments, other


270,191


258,551

Deferred policy acquisition costs, net


93,533


63,914

Other assets


101,889


120,525

Related party assets


175,175


316,157



2,584,357


2,281,686

Property, plant and equipment, at cost:





Land


338,598


281,140

Buildings and improvements


1,155,754


1,087,119

Furniture and equipment


316,772


308,120

Rental trailers and other rental equipment


303,379


255,010

Rental trucks


2,044,639


1,856,433



4,159,142


3,787,822

Less: Accumulated depreciation


(1,524,194)


(1,415,457)

Total property, plant and equipment


2,634,948


2,372,365

Total assets

$

5,219,305

$

4,654,051

LIABILITIES AND STOCKHOLDERS' EQUITY





Liabilities:





Accounts payable and accrued expenses

$

326,182

$

335,326

Notes, loans and leases payable


1,667,008


1,486,211

Policy benefits and losses, claims and loss expenses payable


1,115,823


1,145,943

Liabilities from investment contracts


486,502


240,961

Other policyholders' funds and liabilities


6,348


7,273

Deferred income


27,840


31,525

Deferred income taxes


399,103


370,992

Total liabilities


4,028,806


3,618,231






Stockholders' equity:





Common stock


10,497


10,497

Additional paid-in capital


436,926


433,743

Accumulated other comprehensive loss


(22,192)


(45,436)

Retained earnings


1,444,757


1,317,064

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


(1,839)


(2,398)

Total stockholders' equity


1,190,499


1,035,820

Total liabilities and stockholders' equity

$

5,219,305

$

4,654,051













 

 

 

AMERCO AND CONSOLIDATED ENTITIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS






Quarter Ended

December 31,



2012


2011



(Unaudited)



(In thousands, except share
and per share amounts)



Revenues:





Self-moving equipment rentals

$

394,945

$

375,744

Self-storage revenues


39,111


33,846

Self-moving and self-storage products and service sales


44,491


43,206

Property management fees


6,085


5,368

Life insurance premiums


43,248


132,643

Property and casualty insurance premiums


9,816


9,429

Net investment and interest income


18,927


15,234

Other revenue


22,188


17,619

Total revenues


578,811


633,089






Costs and expenses:





Operating expenses


290,285


269,834

Commission expenses


51,130


47,864

Cost of sales


23,153


24,505

Benefits and losses


38,932


173,748

Amortization of deferred policy acquisition costs


3,391


3,666

Lease expense


27,575


32,325

Depreciation, net of (gains) on disposals of (($1,831) and ($699), respectively)


62,399


56,274

Total costs and expenses


496,865


608,216






Earnings from operations


81,946


24,873

Interest expense


(22,076)


(22,744)

Pretax earnings


59,870


2,129

Income tax expense


(23,024)


(1,401)

Earnings available to common shareholders

$

36,846

$

728

Basic and diluted earnings per common share

$

1.89

$

0.04

Weighted average common shares outstanding: Basic and diluted


19,523,794


19,481,614










 

 

 


AMERCO AND CONSOLIDATED ENTITIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS




Nine Months Ended


December 31,



2012


2011


(Unaudited) 


(In thousands, except share and per share data)  

Revenues:  





Self-moving equipment rentals

$

1,400,300

$

1,333,918

Self-storage revenues


111,825


99,682

Self-moving and self-storage products and service sales


173,399


167,352

Property management fees


15,847


14,929

Life insurance premiums


137,341


229,839

Property and casualty insurance premiums


26,006


25,076

Net investment and interest income


44,237


48,398

Other revenue


76,589


60,041

Total revenues


1,985,544


1,979,235






Costs and expenses:





Operating expenses


883,892


836,149

Commission expenses


180,801


168,865

Cost of sales


86,292


89,729

Benefits and losses


130,682


268,140

Amortization of deferred policy acquisition costs


9,290


10,716

Lease expense


89,962


99,271

Depreciation, net of (gains) on disposals of (($14,879) and ($18,326), respectively)


177,478


148,696

Total costs and expenses


1,558,397


1,621,566






Earnings from operations


427,147


357,669

Interest expense


(67,680)


(68,340)

Pretax earnings


359,467


289,329

Income tax expense


(132,632)


(109,367)

Net earnings


226,835


179,962

Less: Excess of redemption value over carrying value of preferred shares redeemed


-


(5,908)

Less: Preferred stock dividends


-


(2,913)

Earnings available to common shareholders

$

226,835

$

171,141

Basic and diluted earnings per common share

$

11.62

$

8.79

Weighted average common shares outstanding: Basic and diluted


19,512,974


19,470,886

 

 

 

NON-GAAP FINANCIAL RECONCILIATION SCHEDULE








Quarter Ended



December 31, 2011

(In thousands, except share and per share amounts)






AMERCO and Consolidated Entities



Earnings per common share basic and diluted

$

0.04

Charge for strengthening reserves


1.61

Earnings per common share basic and diluted before charge for strengthening reserves

$

1.65




Charge for strengthening reserves

$

(48,250)

Income tax benefit


16,888

Charge for strengthening reserves, net of taxes

$

(31,362)

Charge for strengthening reserves, net of taxes, per common share basic and diluted

$

(1.61)

Weighted average shares outstanding: basic and diluted


19,481,614






Nine Months Ended



December 31, 2011

(In thousands, except share and per share amounts)






AMERCO and Consolidated Entities



Earnings per common share basic and diluted

$

8.79

Charge for strengthening reserves


1.61

Earnings per common share basic and diluted before charge for strengthening reserves

$

10.40




Charge for strengthening reserves

$

(48,250)

Income tax benefit


16,888

Charge for strengthening reserves, net of taxes

$

(31,362)

Charge for strengthening reserves, net of taxes, per common share basic and diluted

$

(1.61)

Weighted average shares outstanding: basic and diluted


19,470,886







       Impact of Redemption of Preferred Stock and Dividend Payment for Preferred Stock on Earnings Per Share for the Nine Months Ended December 31, 2011:




    Excess of redemption value over carrying value of preferred shares redeemed (In thousands)


$5,908




    Weighted average common shares outstanding: Basic and diluted


19,470,886




    Earnings per share impact


$0.30

    Preferred stock dividends (In thousands)


$2,913




    Weighted average common shares outstanding: Basic and diluted


19,470,886




    Earnings per share impact


$0.15

 

 

SOURCE AMERCO



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