AMERCO Reports Third Quarter Fiscal 2021 Financial Results

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RENO, Nev., Feb. 3, 2021 /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, 2020, of $183.0 million, or $9.33 per share, compared with net earnings of $30.9 million, or $1.58 per share, for the same period last year.

For the nine-month period ended December 31, 2020, net earnings available to shareholders were $537.1 million, or $27.39 per share, compared with net earnings of $319.7 million, or $16.31 per share, for the same period last year.

"Our investments over the past few years have positioned us to serve new and existing moving and self-storage customers during a time when the public has particularly needed U-Haul," stated Joe Shoen, chairman of AMERCO. "Most of our marketplaces are very competitive. Our team must keep its eye on the ball to meet current demand and build for the future."

Highlights of Third Quarter Fiscal 2021 Results

Self-moving equipment rental revenues increased $186.7 million or 30% during the third quarter of fiscal 2021, compared with the third quarter of fiscal 2020. Transactions along with average revenue per transaction increased for both our In-town and one-way markets. During the quarter, we experienced an increase in the volume of our Corporate Account business. Compared with the same period last year, we increased the number of retail locations, independent dealers, box trucks and trailers in the rental fleet.
Self-storage revenues increased $16.3 million, or 15% during the third quarter of fiscal 2021, compared with the third quarter of fiscal 2020. The average monthly number of occupied units increased by 20%, or 65,000 units, during the third quarter of fiscal 2021 compared with the same period last year. The growth in revenues and square feet rented comes from a combination of occupancy gains at existing locations and from the addition of new capacity to the portfolio. Over the last twelve months, we added approximately 4.1 million net rentable square feet, or a 10% increase, with approximately 1.0 million of that coming on during the third quarter of fiscal 2021.
Sales of self-moving and self-storage products and services increased $20.1 million, or 37% compared with the third quarter of fiscal 2021 due to increased sales of hitches, moving supplies and propane.
For the third quarter of fiscal 2021 compared with the third quarter of fiscal 2020, depreciation, net of gains and losses on sales decreased $17.5 million. Depreciation expense on the rental equipment fleet decreased $9.5 million as new truck production has been slowed by COVID-19 related production delays earlier this year, while net gains on the disposal of rental equipment increased $13.1 million from higher resale values. All other depreciation increased $5.1 million due primarily to the increase in new moving and storage locations.
For the first nine months of fiscal 2021 and fiscal 2020, gross truck and trailer capital expenditures totaled approximately $541 million compared with $1,161 million, proceeds from the sales of rental equipment totaled $430 million compared with $591 million and spending on real estate related acquisitions and projects totaled approximately $365 million compared with $600 million, respectively.
Fleet maintenance and repair costs increased $2.9 million in the third quarter of fiscal 2021 compared with the same period last year.
Operating earnings at our Moving and Storage operating segment increased $202.2 million in the third quarter of fiscal 2021 compared with the same period last year. Total revenues increased $238.9 million and total costs and expenses increased $36.7 million.
Cash and credit availability at the Moving and Storage operating segment was $1,343.3 million at December 31, 2020 compared with $498.1 million at March 31, 2020.
On December 9, 2020, we declared a cash dividend on our Common Stock of $2.00 per share to holders of record on December 21, 2020. The dividend was paid on December 30, 2020.

AMERCO will hold its investor call for the third quarter of fiscal 2021 on Thursday, February 4, 2021, 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 AMERCOAMERCO 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, 2020, 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 2021 and 2020.

		Quarter Ended December 31,
		2020		2019
		(Unaudited)
		(In thousands)
Self-moving equipment rentals	$	808,215	$	621,471
Self-storage revenues		123,024		106,701
Self-moving and self-storage product and service sales		74,586		54,454
Property management fees		8,765		9,098
Life insurance premiums		29,993		31,164
Property and casualty insurance premiums		19,933		19,267
Net investment and interest income		35,580		33,782
Other revenue		69,886		51,943
Consolidated revenue	$	1,169,982	$	927,880

Listed below are revenues and earnings from operations at each of our operating segments for the third quarter of fiscal 2021 and 2020.

		Quarter Ended December 31,
		2020		2019
		(Unaudited)
		(In thousands)
Moving and storage
Revenues	$	1,085,281	$	846,364
Earnings from operations before equity in earnings of subsidiaries		264,004		61,769
Property and casualty insurance
Revenues		26,640		25,366
Earnings from operations		11,491		9,884
Life insurance
Revenues		61,077		58,889
Earnings from operations		8,724		9,190
Eliminations
Revenues		(3,016)		(2,739)
Earnings from operations before equity in earnings of subsidiaries		(273)		(278)
Consolidated Results
Revenues		1,169,982		927,880
Earnings from operations		283,946		80,565

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,
	2020	2019
	(Unaudited)
	(In thousands, except occupancy rate)
Unit count as of December 31	532	487
Square footage as of December 31	44,948	40,835
Average monthly number of units occupied	388	323
Average monthly occupancy rate based on unit count	73.4%	66.9%
Average monthly square footage occupied	34,802	29,318

Listed below on a consolidated basis are revenues for our major product lines for the first nine months of fiscal 2021 and 2020.

		Nine Months Ended December 31,
		2020		2019
		(Unaudited)
		(In thousands)
Self-moving equipment rentals	$	2,393,530	$	2,174,392
Self-storage revenues		347,252		309,940
Self-moving and self-storage product and service sales		264,564		207,601
Property management fees		23,952		23,487
Life insurance premiums		91,958		96,229
Property and casualty insurance premiums		49,536		51,056
Net investment and interest income		85,895		102,629
Other revenue		225,440		192,009
Consolidated revenue	$	3,482,127	$	3,157,343

Listed below are revenues and earnings from operations at each of our operating segments for the first nine months of fiscal 2021 and 2020.

		Nine Months Ended December 31,
		2020	2019
		(Unaudited)
		(In thousands)
Moving and storage
Revenues	$	3,256,899	2,916,314
Earnings from operations before equity in earnings of subsidiaries		789,621	492,652
Property and casualty insurance
Revenues		62,947	69,199
Earnings from operations		24,338	27,442
Life insurance
Revenues		170,290	179,069
Earnings from operations		16,684	19,912
Eliminations
Revenues		(8,009)	(7,239)
Earnings from operations before equity in earnings of subsidiaries		(821)	(836)
Consolidated Results
Revenues		3,482,127	3,157,343
Earnings from operations		829,822	539,170

	Nine Months Ended December 31,
	2020	2019
	(Unaudited)
	(In thousands, except occupancy rate)
Unit count as of December 31	532	487
Square footage as of December 31	44,948	40,835
Average monthly number of units occupied	369	316
Average monthly occupancy rate based on unit count	71.0%	68.2%
Average monthly square footage occupied	33,036	28,646

AMERCO AND CONSOLIDATED ENTITIES CONDENSED CONSOLIDATED BALANCE SHEETS

		December 31,		March 31,
		2020		2020
		(Unaudited)
		(In thousands)
ASSETS
Cash and cash equivalents	$	1,398,840	$	494,352
Reinsurance recoverables and trade receivables, net		224,447		186,672
Inventories and parts, net		104,180		101,083
Prepaid expenses		450,889		562,904
Investments, fixed maturities and marketable equities		2,606,953		2,492,738
Investments, other		447,902		360,373
Deferred policy acquisition costs, net		92,139		103,118
Other assets		44,261		71,956
Right of use assets – financing, net		920,321		1,080,353
Right of use assets - operating		97,186		106,631
Related party assets		34,963		34,784
		6,422,081		5,594,964
Property, plant and equipment, at cost:
Land		1,059,177		1,032,945
Buildings and improvements		4,996,900		4,663,461
Furniture and equipment		778,732		752,363
Rental trailers and other rental equipment		552,892		511,520
Rental trucks		3,629,888		3,595,933
		11,017,589		10,556,222
Less: Accumulated depreciation		(2,992,365)		(2,713,162)
Total property, plant and equipment, net		8,025,224		7,843,060
Total assets	$	14,447,305	$	13,438,024
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Accounts payable and accrued expenses	$	608,765	$	554,353
Notes, loans and finance/capital leases payable, net		4,678,227		4,621,291
Operating lease liability		97,224		106,443
Policy benefits and losses, claims and loss expenses payable		1,013,582		997,647
Liabilities from investment contracts		1,997,936		1,802,217
Other policyholders' funds and liabilities		34,867		10,190
Deferred income		37,005		31,620
Deferred income taxes, net		1,222,544		1,093,543
Total liabilities		9,690,150		9,217,304

Common stock		10,497		10,497
Additional paid-in capital		453,819		453,819
Accumulated other comprehensive income		85,910		34,652
Retained earnings		4,884,579		4,399,402
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		-		-
Total stockholders' equity		4,757,155		4,220,720
Total liabilities and stockholders' equity	$	14,447,305	$	13,438,024

AMERCO AND CONSOLIDATED ENTITIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

		Quarter Ended December 31,
		2020		2019
		(Unaudited)
		(In thousands, except share and per share data)
Revenues:
Self-moving equipment rentals	$	808,215	$	621,471
Self-storage revenues		123,024		106,701
Self-moving and self-storage products and service sales		74,586		54,454
Property management fees		8,765		9,098
Life insurance premiums		29,993		31,164
Property and casualty insurance premiums		19,933		19,267
Net investment and interest income		35,580		33,782
Other revenue		69,886		51,943
Total revenues		1,169,982		927,880

Costs and expenses:
Operating expenses		539,942		517,453
Commission expenses		86,891		66,542
Cost of sales		45,752		35,318
Benefits and losses		45,631		42,864
Amortization of deferred policy acquisition costs		6,572		8,046
Lease expense		7,522		6,490
Depreciation, net of (gains)/losses on disposal		152,602		170,074
Net losses on disposal of real estate		1,124		528
Total costs and expenses		886,036		847,315

Earnings from operations		283,946		80,565
Other components of net periodic benefit costs		(247)		(263)
Interest expense		(42,128)		(39,973)
Pretax earnings		241,571		40,329
Income tax expense		(58,586)		(9,397)
Earnings available to common shareholders	$	182,985	$	30,932
Basic and diluted earnings per common share	$	9.33	$	1.58
Weighted average common shares outstanding: Basic and diluted		19,607,788		19,607,788

AMERCO AND CONSOLIDATED ENTITIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

		Nine Months Ended December 31,
		2020		2019
		(Unaudited)
		(In thousands, except share and per share data)
Revenues:
Self-moving equipment rentals	$	2,393,530	$	2,174,392
Self-storage revenues		347,252		309,940
Self-moving and self-storage products and service sales		264,564		207,601
Property management fees		23,952		23,487
Life insurance premiums		91,958		96,229
Property and casualty insurance premiums		49,536		51,056
Net investment and interest income		85,895		102,629
Other revenue		225,440		192,009
Total revenues		3,482,127		3,157,343

Costs and expenses:
Operating expenses		1,606,687		1,617,338
Commission expenses		255,431		233,540
Cost of sales		159,516		128,177
Benefits and losses		130,660		137,695
Amortization of deferred policy acquisition costs		19,012		20,625
Lease expense		20,995		19,882
Depreciation, net of gains on disposal		455,711		462,227
Net (gains) losses on disposal of real estate		4,293		(1,311)
Total costs and expenses		2,652,305		2,618,173

Earnings from operations		829,822		539,170
Other components of net periodic benefit costs		(740)		(790)
Interest expense		(122,174)		(117,983)
Pretax earnings		706,908		420,397
Income tax expense		(169,832)		(100,717)
Earnings available to common shareholders	$	537,076	$	319,680
Basic and diluted earnings per common share	$	27.39	$	16.31
Weighted average common shares outstanding: Basic and diluted		19,607,788		19,602,484

NON-GAAP FINANCIAL RECONCILIATION SCHEDULE

As of April 1, 2019, we adopted the new accounting standard for leases. Part of this adoption resulted in approximately $1 billion of property, plant and equipment, net ("PPE") being reclassed to Right of use assets - financing, net ("ROU-financing"). As of December 31, 2020, the balance of ROU-financing also includes the rental equipment purchased under new financing liability leases during the first nine months of fiscal 2021. The table below shows adjusted PPE as of December 31, 2020 and March 31, 2020, by including the ROU-financing. The assets included in the ROU-financing is not a true book value as some of the assets are recorded at between 70% and 100% of value based on the lease agreement.

						December 31,		March 31,
						2020		2020
		December 31,		ROU Assets		Property, Plant and Equipment		Property, Plant and Equipment
		2020		Financing		Adjusted		Adjusted
		(Unaudited)
		(In thousands)

Property, plant and equipment, at cost
Land	$	1,059,177	$	-	$	1,059,177	$	1,032,945
Buildings and improvements		4,996,900		-		4,996,900		4,663,461
Furniture and equipment		778,732		20,966		799,698		773,476
Rental trailers and other rental equipment		552,892		106,961		659,853		627,592
Rental trucks		3,629,888		1,614,194		5,244,082		5,334,014
Subtotal		11,017,589		1,742,121		12,759,710		12,431,488
Less: Accumulated depreciation		(2,992,365)		(821,800)		(3,814,165)		(3,508,075)
Total property, plant and equipment, net	$	8,025,224	$	920,321	$	8,945,545	$	8,923,413

View original content:http://www.prnewswire.com/news-releases/amerco-reports-third-quarter-fiscal-2021-financial-results-301221656.html

SOURCE AMERCO

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