AMERCO Reports Third Quarter Fiscal 2016 Financial Results

Feb 03, 2016, 16:22 ET from AMERCO

RENO, Nev., Feb. 3, 2016 /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, 2015, of $81.8 million, or $4.17 per share, compared with net earnings of $66.5 million, or $3.40 per share, for the same period last year.

For the nine-month period ended December 31, 2015, net earnings available to shareholders were $436.4 million, or $22.27 per share, compared with net earnings of $347.3 million, or $17.73 per share, for the same period last year.

"We have struggled with weather complications in our self-moving business.  Self-storage is being flooded with new entrants seeking easy money returns," stated Joe Shoen, chairman of AMERCO. "Customers continue to have many good options.  Our task is to make U-Haul the customer's best choice."

Highlights of Third Quarter Fiscal 2016 Results

  • Self-moving equipment rental revenues increased $30.0 million or 6% during the third quarter of fiscal 2016, compared with the third quarter of fiscal 2015. Revenue and transactions from both our In-Town and one-way truck and trailer markets increased compared with 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 $9.7 million during the third quarter of fiscal 2016, compared with the third 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 3.6 million net rentable square feet to our owned self-storage portfolio with over 1.2 million of that coming on during the third quarter.
  • Operating earnings at our Moving and Storage operating segment increased $26.2 million in the third quarter of fiscal 2016 compared with the same period last year. Total revenues climbed $36.9 million while being partially offset by a $10.7 million increase in total costs and expenses.
  • For the first nine months of fiscal 2016 compared with the first nine months of fiscal 2015 gross truck and trailer capital expenditures were approximately $586 million compared with approximately $635 million, proceeds from sales of rental equipment were $459 million compared with $319 million and spending on real estate related acquisitions and projects increased approximately $171 million to $439 million.
  • Cash and credit availability at the Moving and Storage operating segment was $697.2 million at December 31, 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 third quarter of fiscal 2016 on Thursday, February 4, 2016, 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, 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 third quarter of fiscal 2016 and 2015.

Quarter Ended December 31,

2015

2014

(Unaudited)

(In thousands)

 Self-moving equipment rentals

$

517,403

$

487,415

 Self-storage revenues

63,164

53,503

 Self-moving and self-storage product and service sales

50,038

49,081

 Property management fees

8,170

7,497

 Life insurance premiums

40,657

39,026

 Property and casualty insurance premiums

14,105

13,584

 Net investment and interest income

19,026

20,752

 Other revenue

32,188

35,497

 Consolidated revenue

744,751

706,355

 

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

Quarter Ended December 31,

2015

2014

(Unaudited)

(In thousands)

 Moving and storage

 Revenues

$

672,752

$

635,833

 Earnings from operations before equity in earnings of subsidiaries

144,070

117,891

 Property and casualty insurance  

 Revenues

17,357

16,545

 Earnings from operations

6,271

6,941

 Life insurance   

 Revenues

56,148

55,377

 Earnings from operations

7,718

8,476

 Eliminations

 Revenues

(1,506)

(1,400)

 Earnings from operations before equity in earnings of subsidiaries

(157)

(156)

 Consolidated Results

 Revenues

744,751

706,355

 Earnings from operations

157,902

133,152

 

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,

2015

2014

(In thousands, except occupancy rate)

Room count as of December 31

265

224

Square footage as of December 31

23,178

19,617

Average monthly number of rooms occupied

205

180

Average monthly occupancy rate based on room count

78.4%

81.1%

Average monthly square footage occupied

18,493

16,144

 

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

Nine Months Ended December 31,

2015

2014

(Unaudited)

(In thousands)

 Self-moving equipment rentals

$

1,844,908

$

1,716,424

 Self-storage revenues

182,415

155,623

 Self-moving and self-storage product and service sales

197,999

191,603

 Property management fees

20,601

18,970

 Life insurance premiums

121,438

115,997

 Property and casualty insurance premiums

38,033

35,665

 Net investment and interest income

63,149

63,654

 Other revenue

123,916

133,865

 Consolidated revenue

2,592,459

2,431,801

 

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

Nine Months Ended December 31,

2015

2014

(Unaudited)

(In thousands)

 Moving and storage

 Revenues

$

2,375,886

$

2,226,899

 Earnings from operations before equity in earnings of subsidiaries

721,755

589,144

 Property and casualty insurance  

 Revenues

48,872

45,488

 Earnings from operations

18,814

17,935

 Life insurance   

 Revenues

171,404

163,120

 Earnings from operations

19,986

21,582

 Eliminations

 Revenues

(3,703)

(3,706)

 Earnings from operations before equity in earnings of subsidiaries

(477)

(474)

 Consolidated Results

 Revenues

2,592,459

2,431,801

 Earnings from operations

760,078

628,187

 

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,

2015

2014

(In thousands, except occupancy rate)

Room count as of December 31

265

224

Square footage as of December 31

23,178

19,617

Average monthly number of rooms occupied

201

179

Average monthly occupancy rate based on room count

81.5%

82.5%

Average monthly square footage occupied

18,064

15,910

 

AMERCO AND CONSOLIDATED ENTITIES

CONDENSED CONSOLIDATED BALANCE SHEETS

December 31,

March 31,

2015

2015

(Unaudited)

(In thousands)

ASSETS

Cash and cash equivalents

$

674,627

$

441,850

Reinsurance recoverables and trade receivables, net

181,326

189,869

Inventories, net

75,032

69,472

Prepaid expenses

180,628

126,296

Investments, fixed maturities and marketable equities

1,463,997

1,304,962

Investments, other

323,039

268,720

Deferred policy acquisition costs, net

129,218

115,422

Other assets

90,989

106,157

Related party assets

92,677

141,790

3,211,533

2,764,538

Property, plant and equipment, at cost:

Land

589,492

467,482

Buildings and improvements

2,026,840

1,728,033

Furniture and equipment

383,914

355,349

Rental trailers and other rental equipment

463,034

436,642

Rental trucks

3,162,170

3,059,987

6,625,450

6,047,493

Less: Accumulated depreciation

(2,074,449)

(1,939,856)

Total property, plant and equipment

4,551,001

4,107,637

Total assets

$

7,762,534

$

6,872,175

LIABILITIES AND STOCKHOLDERS' EQUITY

Liabilities:

Accounts payable and accrued expenses

$

446,044

$

496,370

Notes, loans and leases payable

2,424,671

2,190,869

Policy benefits and losses, claims and loss expenses payable

1,073,600

1,062,188

Liabilities from investment contracts

891,243

685,745

Other policyholders' funds and liabilities

8,439

7,764

Deferred income

18,977

18,081

Deferred income taxes

674,621

526,799

Total liabilities

5,537,595

4,987,816

Common stock

10,497

10,497

Additional paid-in capital

451,492

449,668

Accumulated other comprehensive loss

(59,068)

(34,365)

Retained earnings

2,500,659

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

(991)

(6,391)

Total stockholders' equity

2,224,939

1,884,359

Total liabilities and stockholders' equity

$

7,762,534

$

6,872,175

 

AMERCO AND CONSOLIDATED ENTITIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

Quarter Ended December 31,

2015

2014

(Unaudited)

(In thousands, except share and per share data)

Revenues:

Self-moving equipment rentals

$

517,403

$

487,415

Self-storage revenues

63,164

53,503

Self-moving and self-storage products and service sales

50,038

49,081

Property management fees

8,170

7,497

Life insurance premiums

40,657

39,026

Property and casualty insurance premiums

14,105

13,584

Net investment and interest income

19,026

20,752

Other revenue

32,188

35,497

Total revenues

744,751

706,355

Costs and expenses:

Operating expenses

356,156

338,692

Commission expenses

58,347

58,439

Cost of sales

29,460

30,751

Benefits and losses

41,574

40,084

Amortization of deferred policy acquisition costs

5,138

4,722

Lease expense

10,461

18,705

Depreciation, net of (gains) losses on disposals

85,713

81,810

Total costs and expenses

586,849

573,203

Earnings from operations

157,902

133,152

Interest expense

(25,407)

(25,719)

Pretax earnings

132,495

107,433

Income tax expense

(50,726)

(40,893)

Earnings available to shareholders

$

81,769

$

66,540

Basic and diluted earnings per share

$

4.17

$

3.40

Weighted average shares outstanding: Basic and diluted

19,599,352

19,590,555

 

AMERCO AND CONSOLIDATED ENTITIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

Nine Months Ended December 31,

2015

2014

(Unaudited)

(In thousands, except share and per share data)

Revenues:

Self-moving equipment rentals

$

1,844,908

$

1,716,424

Self-storage revenues

182,415

155,623

Self-moving and self-storage products and service sales

197,999

191,603

Property management fees

20,601

18,970

Life insurance premiums

121,438

115,997

Property and casualty insurance premiums

38,033

35,665

Net investment and interest income

63,149

63,654

Other revenue

123,916

133,865

Total revenues

2,592,459

2,431,801

Costs and expenses:

Operating expenses

1,125,607

1,085,961

Commission expenses

212,204

200,939

Cost of sales

110,596

112,215

Benefits and losses

128,393

120,426

Amortization of deferred policy acquisition costs

15,559

13,196

Lease expense

40,249

60,950

Depreciation, net of (gains) losses on disposals

199,773

209,927

Total costs and expenses

1,832,381

1,803,614

Earnings from operations

760,078

628,187

Interest expense

(71,480)

(74,744)

Fees and amortization on early extinguishment of debt

-

(4,081)

Pretax earnings

688,598

549,362

Income tax expense

(252,165)

(202,101)

Earnings available to shareholders

$

436,433

$

347,261

Basic and diluted earnings per share

$

22.27

$

17.73

Weighted average shares outstanding: Basic and diluted

19,597,735

19,584,183

 

SOURCE AMERCO



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