RENO, Nev., Nov. 8, 2006 (PRIMEZONE) -- AMERCO (Nasdaq:UHAL), parent of U-Haul International, Inc., North America's largest "do-it-yourself" moving and storage operator, today reported net earnings available to common shareholders for its second quarter ending September 30, 2006, of $57.3 million, or $2.74 per share, compared with net earnings of $65.9 million, or $3.16 per share, for the same period last year. Included in the results for September 30, 2006, is a nonrecurring after-tax charge of $0.20 per share associated with the Company's second quarter debt amendment. Taking into account the nonrecurring after-tax charge, adjusted earnings were $2.94 per share for the second quarter of fiscal 2007.
For the six-month period ending September 30, 2006, net earnings available to common shareholders were $109.4 million, or $5.23 per share, compared with net earnings of $97.7 million, or $4.69 per share for the same period last year. Included in the results for September 30, 2006, is a nonrecurring after-tax charge of $0.20 per share associated with the Company's second quarter debt amendment. Included in the results for September 30, 2005 is a nonrecurring after-tax charge of $1.08 per share associated with the Company's first quarter debt refinancing. Taking into account these nonrecurring charges, the adjusted earnings per share were $5.43 for the period ending September 30, 2006 and $5.77 for the six months ending September 30, 2005.
"We experienced success toward improving U-Move transaction volume during the quarter," stated Joe Shoen, chairman of AMERCO. "Pricing in our market has been below levels from prior years and we are undertaking efforts to improve both revenue and transaction levels. We continue to improve the U-Haul fleet through the placement of new trucks. Growth in rooms available and rented in our storage program is continuing on plan with expansion at existing locations and development of new properties," Shoen said.
Highlights of Second Quarter 2007 Results
-- In the second quarter, we placed over 7,700 rental trucks in
service, which helped to increase transactions. Approximately 90
percent of these new trucks were purchased as opposed to leased
as part of our program to reduce current taxes. This has the
effect of shifting per-truck ownership costs to earlier years.
Depreciation expense, before gains and losses on sales,
increased $14.2 million for the quarter and $23.9 million for
the six months compared with the same periods last year.
-- The Company amended a real estate loan during the quarter. The
amended loan increases availability and extends the final
maturity date from 2010 to August 2018. The facility contains a
12-year, $200 million revolver that has yet to be drawn. Cash
and available credit lines at our moving and storage business
totaled $644.5 million at September 30, 2006.
-- On September 13, 2006, the board of directors authorized the
Company to repurchase up to $50 million of its common stock. The
stock may be repurchased by the Company from time to time on the
open market until and October 31, 2007.
AMERCO will hold its investor call for the second quarter of fiscal year 2007 on Thursday, November 9, 2006, at 9 a.m. Mountain Time (11 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., North America's largest do-it-yourself moving and storage operator, AMERCO Real Estate Company, Republic Western Insurance Company and Oxford Life Insurance Company. With a network of over 15,400 locations in all 50 United States and 10 Canadian provinces, the Company has the largest consumer truck-rental fleet in the world, with over 93,000 trucks, 80,675 trailers and 33,500 towing devices.
U-Haul has also been a leader in the storage industry since 1974, with more than 380,000 rooms and more than 33 million square feet of storage space at nearly 1,050 owned and managed facilities throughout North America.
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 Form 10-Q for the quarter ended September 30, 2006, which is on file with the SEC.
Report on Business Operations
Listed on a consolidated basis are revenues for our major product lines for the second quarter of fiscal 2007 and fiscal 2006.
Quarter Ended Sept 30,
---------------------
2006 2005
-------- --------
(Unaudited)
(In thousands)
Revenues
Self-moving equipment rentals $445,720 $446,705
Self-storage revenues 32,416 31,224
Self-moving & self-storage products
and service sales 61,916 62,492
Property management fees 3,986 3,829
Life insurance premiums 31,120 29,718
Property & casualty insurance premiums 6,470 5,399
Net investment & interest income 15,908 12,352
Other revenues 8,999 13,797
-------- --------
Consolidated revenues $606,535 $605,516
-------- --------
Listed on a consolidated basis are revenues for our major product lines for the first six months of fiscal 2007 and fiscal 2006.
Six Months Ended Sept 30,
------------------------
2006 2005
---------- ----------
(Unaudited)
(In thousands)
Revenues
Self-moving equipment rentals $ 852,954 $ 847,965
Self-storage revenues 62,847 59,992
Self-moving & self-storage products
and service sales 129,367 129,055
Property management fees 7,833 8,269
Life insurance premiums 62,039 59,307
Property & casualty insurance premiums 11,852 10,223
Net investment & interest income 29,738 26,066
Other revenues 16,932 24,097
---------- ----------
Consolidated revenues $1,173,562 $1,164,974
---------- ----------
Listed below are revenues and earnings from operations at each of our operating segments for the second quarter of fiscal 2007 and 2006; for the insurance companies the second quarter ended June 30, 2006 and 2005.
Quarter Ended Sept 30,
---------------------
2006 2005
-------- --------
(Unaudited)
(In thousands)
Moving & storage
Revenues $551,821 $555,383
Earnings from operations 121,790 124,573
Property and casualty insurance
Revenues 9,260 8,057
Earnings from operations 1,664 1,742
Life insurance
Revenues 38,731 36,270
Earnings from operations 5,403 3,297
SAC Holding II
Revenues 12,535 12,612
Earnings from operations 4,139 3,049
Eliminations
Revenues (5,812) (6,806)
Earnings from operations (6,743) (4,423)
Consolidated results
Revenues 606,535 605,516
Earnings from operations 126,253 128,238
Listed below are revenues and earnings from operations at each of our operating segments for the first six months fiscal 2007 and 2006; for the insurance companies the first six months ended June 30, 2006 and 2005.
Six Months Ended Sept 30,
------------------------
2006 2005
---------- ----------
(Unaudited)
(In thousands)
Moving & storage
Revenues $1,066,459 $1,062,946
Earnings from operations 228,711 233,538
Property and casualty insurance
Revenues 17,328 16,366
Earnings from operations 3,365 3,324
Life insurance
Revenues 76,868 74,343
Earnings from operations 7,354 6,737
SAC Holding II
Revenues 25,014 24,671
Earnings from operations 8,262 7,100
Eliminations
Revenues (12,107) (13,352)
Earnings from operations (11,273) (9,901)
Consolidated results
Revenues 1,173,562 1,164,974
Earnings from operations 236,419 240,798
The Company owns and manages self-storage facilities. Self-storage revenues reported in the condensed consolidated financial statements for moving and storage 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 (except for SAC Holding II). Self-storage data for both our owned and managed locations for the second quarter of fiscal 2007 and 2006 is as follows:
Quarter Ended Sept 30,
---------------------
2006 2005
------- -------
(Unaudited)
(In thousands, except occupancy rate)
Room count as of Sept 30 380 375
Square footage as of Sept 30 33,471 32,634
Average number of rooms occupied 337 332
Average occupancy rate based on room
count 88.7% 88.5%
Average square footage occupied 30,135 29,517
AMERCO AND CONSOLIDATED ENTITIES
CONDENSED CONSOLIDATED BALANCE SHEETS
Sept 30, March 31,
2006 2006
----------- -----------
(Unaudited)
Assets (In thousands)
Cash and cash equivalents $ 326,616 $ 155,459
Reinsurance recoverables and trade
receivables, net 215,236 230,179
Notes and mortgage receivables, net 2,260 2,532
Inventories, net 74,806 64,919
Prepaid expenses 47,529 53,262
Investments, fixed maturities and
marketable equities 685,428 695,958
Investments, other 162,869 209,361
Deferred policy acquisition costs, net 53,727 47,821
Other assets 95,776 102,094
Related party assets 259,530 270,468
----------- -----------
1,923,777 1,832,053
----------- -----------
Property, plant and equipment, at cost:
Land 186,248 175,785
Buildings and improvements 780,860 739,603
Furniture and equipment 293,768 281,371
Rental trailers and other rental
equipment 201,714 201,273
Rental trucks 1,519,981 1,331,891
SAC Holding II - PP&E 79,393 79,217
----------- -----------
3,061,946 2,809,140
Less: Accumulated depreciation (1,281,629) (1,273,975)
----------- -----------
Total property, plant and equipment 1,780,335 1,535,165
----------- -----------
Total assets 3,704,112 3,367,218
=========== ===========
Liabilities & stockholders' equity
Liabilities:
Accounts payable & accrued expenses $ 248,438 $ 235,878
AMERCO notes and loans payable 1,201,081 965,634
SAC Holding II notes & loans payable,
non-recourse to AMERCO 75,597 76,232
Policy benefits & losses, claims & loss
expenses payable 800,763 800,413
Liabilities from investment contracts 417,318 449,149
Other policyholders' funds &
liabilities 9,431 7,705
Deferred income 15,768 21,346
Deferred income taxes 132,815 108,092
Related party liabilities 3,332 7,165
----------- -----------
Total liabilities 2,904,543 2,671,614
----------- -----------
Stockholders' equity:
Series A common stock 929 929
Common stock 9,568 9,568
Additional paid-in-capital 373,902 367,655
Accumulated other comprehensive loss (41,222) (28,902)
Retained earnings 883,214 773,784
Cost of common shares in treasury, net (418,092) (418,092)
Unearned employee stock ownership plan
shares (8,730) (9,338)
----------- -----------
Total stockholders' equity 799,569 695,604
----------- -----------
Total liabilities & stockholders' equity 3,704,112 3,367,218
=========== ===========
AMERCO AND CONSOLIDATED ENTITIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
Quarter Ended September 30,
2006 2005
------------ ------------
(Unaudited)
(In thousands, except share and
per share amounts)
Revenues:
Self-moving equipment rentals $ 445,720 $ 446,705
Self-storage revenues 32,416 31,224
Self-moving and self-storage
products and service sales 61,916 62,492
Property management fees 3,986 3,829
Life insurance premiums 31,120 29,718
Property and casualty insurance
premiums 6,470 5,399
Net investment and interest income 15,908 12,352
Other revenue 8,999 13,797
------------ ------------
Total revenues 606,535 605,516
------------ ------------
Costs and expenses:
Operating expenses 280,808 289,701
Commission expenses 53,605 53,197
Cost of sales 31,448 30,917
Benefits and losses 28,842 26,709
Amortization of deferred policy
acquisition costs 4,825 5,854
Lease expense 37,667 36,578
Depreciation, net of (gains)
losses on disposals 43,087 34,322
------------ ------------
Total costs and expenses 480,282 477,278
------------ ------------
Earnings from operations 126,253 128,238
Interest expense (21,063) (15,245)
Amortization of fees on early
extinguishment of debt (6,969) --
------------ ------------
Pretax earnings 98,221 112,993
Income tax expense (37,730) (43,871)
------------ ------------
Net earnings 60,491 69,122
Less: Preferred stock dividends (3,241) (3,241)
------------ ------------
Earnings available to common
shareholders $ 57,250 $ 65,881
============ ============
Basic and diluted earnings per
common share $ 2.74 $ 3.16
============ ============
Weighted average common shares
outstanding:
Basic and diluted shares 20,910,204 20,848,620
============ ============
AMERCO AND CONSOLIDATED ENTITIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
Six Months Ended
September 30,
2006 2005
----------- -----------
(Unaudited)
(In thousands, except
share and per share
amounts)
Revenues:
Self-moving equipment rentals $ 852,954 $ 847,965
Self-storage revenues 62,847 59,992
Self-moving and self-storage products
and service sales
129,367 129,055
Property management fees 7,833 8,269
Life insurance premiums 62,039 59,307
Property and casualty insurance premiums 11,852 10,223
Net investment and interest income 29,738 26,066
Other revenue 16,932 24,097
----------- -----------
Total revenues 1,173,562 1,164,974
----------- -----------
Costs and expenses:
Operating expenses 542,187 556,493
Commission expenses 103,141 101,215
Cost of sales 63,764 61,961
Benefits and losses 59,448 54,023
Amortization of deferred policy
acquisition costs 10,451 12,052
Lease expense 75,394 69,873
Depreciation, net of (gains) losses on
disposals 82,758 68,559
----------- -----------
Total costs and expenses 937,143 924,176
----------- -----------
Earnings from operations 236,419 240,798
Interest expense (39,525) (34,881)
Fees and amortization on early
extinguishment of debt (6,969) (35,627)
----------- -----------
Pretax earnings 189,925 170,290
Income tax expense (74,013) (66,106)
----------- -----------
Net earnings 115,912 104,184
Less: Preferred stock dividends (6,482) (6,482)
----------- -----------
Earnings available to common shareholders 109,430 $ 97,702
=========== ===========
Basic and diluted earnings per common
share $ 5.23 $ 4.69
=========== ===========
Weighted average common shares
outstanding:
Basic and diluted shares 20,903,946 20,842,539
=========== ===========
NON-GAAP FINANCIAL RECONCILIATION SCHEDULE
Quarter Ended
September 30, 2006
------------------
(In thousands, except share and per share
amounts)
AMERCO and Consolidated Entities
Amortization of fees on early extinguishment
of debt $ (6,969)
Income tax benefit 2,718
------------------
Amortization of fees on early extinguishment
of debt, net of taxes $ (4,251)
------------------
Amortization of fees on early extinguishment
of debt, net of taxes, per common share
basic and diluted $ (0.20)
------------------
Weighted average shares outstanding: Basic
and diluted 20,910,204
------------------
Six Months Ended
September 30, 2006
------------------
(In thousands, except share and per share
amounts)
AMERCO and Consolidated Entities
Amortization of fees on early extinguishment
of debt $ (6,969)
Income tax benefit 2,718
------------------
Amortization of fees on early extinguishment
of debt, net of taxes $ (4,251)
------------------
Amortization of fees on early extinguishment
of debt, net of taxes, per common share
basic and diluted $ (0.20)
------------------
Weighted average shares outstanding: Basic
and diluted 20,903,946
------------------
Six Months Ended
September 30, 2005
------------------
(In thousands, except share and per share
amounts)
AMERCO and Consolidated Entities
Amortization of fees on early extinguishment
of debt $ (35,627)
Income tax benefit 13,109
------------------
Amortization of fees on early extinguishment
of debt, net of taxes $ (22,518)
------------------
Amortization of fees on early extinguishment
of debt, net of taxes, per common share
basic and diluted $ (1.08)
------------------
Weighted average shares outstanding: Basic
and diluted 20,842,539
------------------