AMERCO (UHAL) Misses Q2 EPS by 97c, Revenues Beat

AMERCO (NASDAQ: UHAL) reported Q2 EPS of $7.97, $0.97 worse than the analyst estimate of $8.94. Revenue for the quarter came in at $1.15 billion versus the consensus estimate of $1.12 billion.

Highlights of Second Quarter Fiscal 2020 Results

• Self-moving equipment rental revenues increased $22.6 million or 3% during the second quarter of fiscal 2020, compared with the second quarter of fiscal 2019 from improvements in both One-way and in-town markets. Compared with the same period last year, we increased the number of Company-owned locations, along with trucks, trailers and towing devices in the rental fleet.
• Self-storage revenues increased $13.5 million during the second quarter of fiscal 2020, compared with the second quarter of fiscal 2019. The average monthly amount of occupied units increased by 17%, or 47,000 units during the second quarter of fiscal 2020 compared with the same period last year. The growth in revenues comes from a combination of occupancy gains at existing locations and the addition of new facilities to the portfolio. Over the last twelve months, we have added approximately 6.1 million net rentable square feet, or an 18% increase to our owned self-storage portfolio with 1.5 million of that coming on during the second quarter.
• For the second quarter of fiscal 2020 compared with the second quarter of fiscal 2019, depreciation, net of gains and losses on sales increased $18.9 million. Depreciation expense on the rental equipment fleet increased $17.1 million primarily due to a larger fleet while gains on the sales of rental trucks increased $6.0 million. All other depreciation increased $7.8 million from the increase in new moving and storage locations.
• For the first six months of fiscal 2020 and fiscal 2019 gross truck and trailer capital expenditures were approximately $1,037 million compared with $787 million, proceeds from the sales of rental equipment were $397 million compared with $428 million and spending on real estate related acquisitions and projects were approximately $423 million compared with $481 million.
• Fleet maintenance and repair costs increased $3.9 million in the second quarter of fiscal 2020 compared with the same period last year.
• Operating earnings at our Moving and Storage operating segment decreased $6.9 million in the second quarter of fiscal 2020 compared with the same period last year. Total revenues climbed $42.6 million and total costs and expenses increased $49.5 million.
• Cash and credit availability at the Moving and Storage operating segment was $559.0 million at September 30, 2019 compared with $724.5 million at March 31, 2019.
• On August 22, 2019, we declared a cash dividend on our Common Stock of $0.50 per share to holders of record on September 9, 2019. The dividend was paid on September 23, 2019.

"We continued to fill self-storage rooms during the quarter while also adding new locations to the portfolio," stated Joe Shoen, chairman of AMERCO. "Growth in the fleet has led to additional depreciation and maintenance costs. We have not realized the truck and trailer revenue we expected from this investment. I am working to resolve this, but improvement will likely come slowly."

For earnings history and earnings-related data on AMERCO (UHAL) click here.

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