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Press release from PR Newswire

AMERCO Reports Third Quarter Fiscal 2013 Financial Results

Wednesday, February 06, 2013

AMERCO Reports Third Quarter Fiscal 2013 Financial Results16:20 EST Wednesday, February 06, 2013RENO, 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 ResultsSelf-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.comUse of Non-GAAP Financial InformationThe 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 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, 2012, which is on file with the SEC.Report on Business OperationsListed below on a consolidated basis are revenues for our major product lines for the third quarter of fiscal 2013 and 2012.Quarter Ended December 31,20122011(Unaudited)(In thousands)  Self-moving equipment rentals$394,945$375,744  Self-storage revenues39,11133,846  Self-moving and self-storage products and services sales                                            44,49143,206  Property management fees6,0855,368  Life insurance premiums43,248132,643  Property and casualty insurance premiums9,8169,429  Net investment and interest income18,92715,234  Other revenue22,18817,619    Consolidated revenue$578,811$633,089Listed 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 31,20122011(Unaudited)(In thousands)Moving and storage   Revenues$514,806$483,066   Earnings from operations before equity in earnings of subsidiaries72,78161,766Property and casualty insurance   Revenues11,86511,666   Earnings (loss) from operations2,062(43,444)Life insurance   Revenues53,090139,643   Earnings from operations7,1816,599Eliminations  Revenues(950)(1,286) Earnings from operations before equity in earnings of subsidiaries(78)(48)Consolidated results  Revenues578,811633,089  Earnings from operations81,94624,873The 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 31,20122011(Unaudited)(In thousands, exceptoccupancy rate)Room count as of December 31 441420Square footage as of December 3139,57537,464Average number of rooms occupied354329Average occupancy rate based on room count80.6%78.5%Average square footage occupied32,35629,879Listed 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 31,20122011(Unaudited)(In thousands)  Self-moving equipment rentals$1,400,300$1,333,918  Self-storage revenues111,82599,682  Self-moving and self-storage products and service sales173,399167,352  Property management fees15,84714,929  Life insurance premiums137,341229,839  Property and casualty insurance premiums26,00625,076  Net investment and interest income44,23748,398  Other revenue76,58960,041    Consolidated revenue$1,985,544$1,979,235Listed 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 31,20122011(Unaudited)(In thousands)Moving and storage   Revenues$1,793,224$1,697,683   Earnings from operations before equity in earnings of subsidiaries407,567383,072Property and casualty insurance   Revenues32,52132,471   Earnings (loss) from operations6,991(39,348)Life insurance   Revenues162,396252,834   Earnings from operations12,80714,430Eliminations  Revenues(2,597)(3,753) Earnings from operations before equity in earnings of subsidiaries(218)(485)Consolidated results  Revenues1,985,5441,979,235  Earnings from operations427,147357,669The 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 31,20122011(Unaudited)(In thousands, exceptoccupancy rate)Room count as of December 31441420Square footage as of December 3139,57537,464Average number of rooms occupied351330Average occupancy rate based on room count81.3%79.3%Average square footage occupied31,94929,990   AMERCO AND CONSOLIDATED ENTITIESCONDENSED CONSOLIDATED BALANCE SHEETSDecember 31,March 31,20122012(Unaudited)(In thousands, except share data)ASSETSCash and cash equivalents$586,124$357,180Reinsurance recoverables and trade receivables, net226,340297,974Inventories, net55,98958,735Prepaid expenses55,14841,858Investments, fixed maturities and marketable equities1,019,968766,792Investments, other270,191258,551Deferred policy acquisition costs, net93,53363,914Other assets101,889120,525Related party assets175,175316,1572,584,3572,281,686Property, plant and equipment, at cost:Land338,598281,140Buildings and improvements1,155,7541,087,119Furniture and equipment316,772308,120Rental trailers and other rental equipment303,379255,010Rental trucks2,044,6391,856,4334,159,1423,787,822Less: Accumulated depreciation(1,524,194)(1,415,457)Total property, plant and equipment2,634,9482,372,365Total assets$5,219,305$4,654,051LIABILITIES AND STOCKHOLDERS' EQUITYLiabilities:Accounts payable and accrued expenses$326,182$335,326Notes, loans and leases payable1,667,0081,486,211Policy benefits and losses, claims and loss expenses payable1,115,8231,145,943Liabilities from investment contracts486,502240,961Other policyholders' funds and liabilities6,3487,273Deferred income27,84031,525Deferred income taxes399,103370,992Total liabilities4,028,8063,618,231Stockholders' equity:Common stock10,49710,497Additional paid-in capital436,926433,743Accumulated other comprehensive loss(22,192)(45,436)Retained earnings1,444,7571,317,064Cost 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' equity1,190,4991,035,820Total liabilities and stockholders' equity$5,219,305$4,654,051   AMERCO AND CONSOLIDATED ENTITIESCONDENSED CONSOLIDATED STATEMENTS OF OPERATIONSQuarter Ended December 31,20122011(Unaudited)(In thousands, except shareand per share amounts)Revenues:Self-moving equipment rentals$394,945$375,744Self-storage revenues39,11133,846Self-moving and self-storage products and service sales44,49143,206Property management fees6,0855,368Life insurance premiums43,248132,643Property and casualty insurance premiums9,8169,429Net investment and interest income18,92715,234Other revenue22,18817,619Total revenues578,811633,089Costs and expenses:Operating expenses290,285269,834Commission expenses51,13047,864Cost of sales23,15324,505Benefits and losses38,932173,748Amortization of deferred policy acquisition costs3,3913,666Lease expense27,57532,325Depreciation, net of (gains) on disposals of (($1,831) and ($699), respectively)62,39956,274Total costs and expenses496,865608,216Earnings from operations81,94624,873Interest expense(22,076)(22,744)Pretax earnings 59,8702,129Income tax expense (23,024)(1,401)Earnings available to common shareholders$36,846$728Basic and diluted earnings per common share$1.89$0.04Weighted average common shares outstanding: Basic and diluted19,523,79419,481,614   AMERCO AND CONSOLIDATED ENTITIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONSNine Months EndedDecember 31,20122011(Unaudited) (In thousands, except share and per share data)  Revenues:  Self-moving equipment rentals$1,400,300$1,333,918Self-storage revenues111,82599,682Self-moving and self-storage products and service sales173,399167,352Property management fees15,84714,929Life insurance premiums137,341229,839Property and casualty insurance premiums26,00625,076Net investment and interest income44,23748,398Other revenue76,58960,041Total revenues1,985,5441,979,235Costs and expenses:Operating expenses883,892836,149Commission expenses180,801168,865Cost of sales86,29289,729Benefits and losses130,682268,140Amortization of deferred policy acquisition costs9,29010,716Lease expense89,96299,271Depreciation, net of (gains) on disposals of (($14,879) and ($18,326), respectively)177,478148,696Total costs and expenses1,558,3971,621,566Earnings from operations427,147357,669Interest expense(67,680)(68,340)Pretax earnings 359,467289,329Income tax expense (132,632)(109,367)Net earnings 226,835179,962Less: 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$171,141Basic and diluted earnings per common share$11.62$8.79Weighted average common shares outstanding: Basic and diluted19,512,97419,470,886   NON-GAAP FINANCIAL RECONCILIATION SCHEDULEQuarter EndedDecember 31, 2011(In thousands, except share and per share amounts)AMERCO and Consolidated EntitiesEarnings per common share basic and diluted$0.04Charge for strengthening reserves1.61Earnings per common share basic and diluted before charge for strengthening reserves$1.65Charge for strengthening reserves$(48,250)Income tax benefit16,888Charge 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 diluted19,481,614Nine Months EndedDecember 31, 2011(In thousands, except share and per share amounts)AMERCO and Consolidated EntitiesEarnings per common share basic and diluted$8.79Charge for strengthening reserves1.61Earnings per common share basic and diluted before charge for strengthening reserves$10.40Charge for strengthening reserves$(48,250)Income tax benefit16,888Charge 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 diluted19,470,886       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 diluted19,470,886    Earnings per share impact$0.30    Preferred stock dividends (In thousands)$2,913    Weighted average common shares outstanding: Basic and diluted19,470,886    Earnings per share impact$0.15  SOURCE AMERCOFor further information: Jennifer Flachman, Director of Investor Relations, AMERCO, +1-602-263-6601, Flachman@amerco.com