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UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

(Mark One)

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934.

For the quarterly period ended June 30, 2022

or

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934.

For the transition period from __________________ to __________________

Commission File Number 001-11255

 

 

 

State or other jurisdiction of incorporation or organization

Registrant, State of Incorporation,

Address and Telephone Number

I.R.S. Employer

Identification No.

 

 

 

 

AMERCOlogo

 

 

 

 

Nevada

AMERCO

88-0106815

 

(A Nevada Corporation)

 

 

5555 Kietzke Lane Suite 100

 

 

Reno , Nevada 89511

 

 

Telephone ( 775 ) 688-6300

 

 

 

 

 

N/A

 

(Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol

Name of each exchange on which registered

Common Stock, $0.25 par value

UHAL

NASDAQ Global Select Market

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes   No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule   405 of Regulation   S-T (§232.405 of this chapter) during the preceding 12   months (or for such shorter period that the registrant was required to submit such files).   Yes     No  

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.  

 

Large Accelerated Filer Accelerated Filer   

Non-accelerated Filer   Smaller Reporting Company

Emerging Growth Company





If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes No

19,607,788 shares of AMERCO Common Stock, $0.25 par value, were outstanding at August 1, 2022.



 

 

TABLE OF CONTENTS

 

        

Page

 

PART I FINANCIAL INFORMATION

 

Item 1.

Financial Statements

 

 

a) Condensed Consolidated Balance Sheets as of June 30, 2022 (unaudited) and March 31, 2022

1

 

b) Condensed Consolidated Statements of Operations for the Quarters Ended June 30, 2022, and 2021 (unaudited)

2

 

c) Condensed Consolidated Statements of Comprehensive Income (Loss) for the Quarters Ended June 30, 2022, and 2021 (unaudited)

3

 

d) Condensed Consolidated Statements of Changes in Stockholders’ Equity for the Quarters Ended June 30, 2022, and 2021 (unaudited)

4

 

e) Condensed Consolidated Statements of Cash Flows for the Quarters Ended June 30, 2022, and 2021 (unaudited)

5

 

f) Notes to Condensed Consolidated Financial Statements (unaudited)

6

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

35

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

44

Item 4.

Controls and Procedures

46

 

 

 

 

PART II OTHER INFORMATION

 

Item 1.

Legal Proceedings

46

Item 1A.

Risk Factors

46

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

46

Item 3.

Defaults Upon Senior Securities

46

Item 4.

Mine Safety Disclosures

47

Item 5.

Other Information

47

Item 6.

Exhibits

47



 

part i financial information

 

Item 1. Financial Statements

 

AMERCO AND CONSOLIDATED SUBSIDIARIES

CONDENSED CONSOLIDATED balance sheets

 

 

June 30,

 

March 31,

 

 

2022

 

2022

 

 

(Unaudited)

 

 

 

 

(In thousands, except share data)

ASSETS

 

 

 

 

Cash and cash equivalents

$

3,098,271

$

2,704,137

Reinsurance recoverables and trade receivables, net

 

219,574

 

229,343

Inventories and parts, net

 

164,579

 

158,888

Prepaid expenses

 

231,714

 

236,915

Investments, fixed maturities and marketable equities

 

2,669,986

 

2,893,399

Investments, other

 

557,124

 

543,755

Deferred policy acquisition costs, net

 

129,568

 

103,828

Other assets

 

53,477

 

60,409

Right of use assets - financing, net

 

568,223

 

620,824

Right of use assets - operating, net

 

72,538

 

74,382

Related party assets

 

45,190

 

47,851

 

 

7,810,244

 

7,673,731

Property, plant and equipment, at cost:

 

 

 

 

Land

 

1,354,587

 

1,283,142

Buildings and improvements

 

6,154,373

 

5,974,639

Furniture and equipment

 

858,094

 

846,132

Rental trailers and other rental equipment

 

671,880

 

615,679

Rental trucks

 

4,873,554

 

4,638,814

 

 

13,912,488

 

13,358,406

Less: Accumulated depreciation

 

(3,891,128)

 

(3,732,556)

Total property, plant and equipment, net

 

10,021,360

 

9,625,850

Total assets

$

17,831,604

$

17,299,581

LIABILITIES AND STOCKHOLDERS' EQUITY

 

 

 

 

Liabilities:

 

 

 

 

Accounts payable and accrued expenses

$

722,617

$

677,785

Notes, loans and finance leases payable, net

 

6,232,564

 

6,022,497

Operating lease liabilities

 

72,277

 

74,197

Policy benefits and losses, claims and loss expenses payable

 

988,030

 

978,254

Liabilities from investment contracts

 

2,374,250

 

2,336,238

Other policyholders' funds and liabilities

 

11,999

 

10,812

Deferred income

 

63,647

 

49,157

Deferred income taxes, net

 

1,292,369

 

1,265,358

Total liabilities

 

11,757,753

 

11,414,298

 

 

 

 

 

Commitments and contingencies (notes 3, 7, 8 and 9)

 

 

 

 

Stockholders' equity:

 

 

 

 

Series preferred stock, with or without par value, 50,000,000 shares authorized:

 

 

 

 

Series A preferred stock, with no par value, 6,100,000 shares authorized;

 

 

 

 

6,100,000 shares issued and none outstanding as of June 30 and March 31, 2022

 

 

Series B preferred stock, with no par value, 100,000 shares authorized; none

 

 

 

 

issued and outstanding as of June 30 and March 31, 2022

 

 

Serial common stock, with or without par value, 250,000,000 shares authorized:

 

 

 

 

Serial common stock of $ 0.25 par value, 10,000,000 shares authorized;

 

 

 

 

none issued and outstanding as of June 30 and March 31, 2022

 

 

Common stock, with $ 0.25 par value, 250,000,000 shares authorized:

 

 

 

 

Common stock of $ 0.25 par value, 250,000,000 shares authorized; 41,985,700

 

 

 

 

issued and 19,607,788 outstanding as of June 30 and March 31, 2022

 

10,497

 

10,497

Additional paid-in capital

 

453,819

 

453,819

Accumulated other comprehensive income (loss)

 

(89,246)

 

46,384

Retained earnings

 

6,376,431

 

6,052,233

Cost of common stock in treasury, net ( 22,377,912 shares as of June 30 and March 31, 2022)

 

(525,653)

 

(525,653)

Cost of preferred stock in treasury, net ( 6,100,000 shares as of June 30 and March 31, 2022)

 

(151,997)

 

(151,997)

Total stockholders' equity

 

6,073,851

 

5,885,283

Total liabilities and stockholders' equity

$

17,831,604

$

17,299,581

The accompanying notes are an integral part of these condensed consolidated financial statements.

1

 



 



AMERCO AND CONSOLIDATED SUBSIDIARIES

CONDENSED CONSOLIDATED Statements of operations

 

 

Quarter Ended June 30,

 

 

2022

 

2021

 

 

(Unaudited)

 

 

(In thousands, except share and per share amounts)

Revenues:

 

 

 

 

Self-moving equipment rentals

$

1,090,775

$

1,035,377

Self-storage revenues

 

173,177

 

137,393

Self-moving and self-storage products and service sales

 

109,351

 

104,885

Property management fees

 

9,139

 

8,449

Life insurance premiums

 

25,781

 

28,705

Property and casualty insurance premiums

 

19,972

 

16,869

Net investment and interest income

 

33,573

 

34,999

Other revenue

 

136,072

 

106,179

Total revenues

 

1,597,840

 

1,472,856

 

 

 

 

 

Costs and expenses:

 

 

 

 

Operating expenses

 

733,167

 

614,529

Commission expenses

 

118,493

 

113,149

Cost of sales

 

79,671

 

69,915

Benefits and losses

 

44,100

 

47,298

Amortization of deferred policy acquisition costs

 

7,672

 

8,823

Lease expense

 

7,475

 

7,647

Depreciation, net of gains on disposal ($64,348 and $50,323, respectively)

 

113,796

 

121,717

Net (gains) losses on disposal of real estate

 

2,307

 

(4,430)

Total costs and expenses

 

1,106,681

 

978,648

 

 

 

 

 

Earnings from operations

 

491,159

 

494,208

Other components of net periodic benefit costs

 

(304)

 

(280)

Interest expense

 

(49,799)

 

(39,178)

Pretax earnings

 

441,056

 

454,750

Income tax expense

 

(107,054)

 

(109,575)

Earnings available to common stockholders

$

334,002

$

345,175

Basic and diluted earnings per common share

$

17.03

$

17.60

Weighted average common shares outstanding: Basic and diluted

 

19,607,788

 

19,607,788

 

Related party revenues for the first quarter of fiscal 2023 and 2022, net of eliminations, were $9.1 million and $8.4 million, respectively.

Related party costs and expenses for the first quarter of fiscal 2023 and 2022, net of eliminations, were $25.5 million and $23.5 million, respectively.

Please see Note 9, Related Party Transactions, of the Notes to Condensed Consolidated Financial Statements for more information on the related party revenues and costs and expenses.

The accompanying notes are an integral part of these condensed consolidated financial statements.

2

 



 



AMERCO AND CONSOLIDATED SUBSIDIARIES

Condensed consolidatED statements of COMPREHENSIVE INCOME (loss)

Quarter Ended June 30, 2022

 

Pre-tax

 

Tax

 

Net

 

 

(Unaudited)

 

 

(In thousands)

Comprehensive income:

 

 

 

 

 

 

Net earnings

$

441,056

$

(107,054)

$

334,002

Other comprehensive income (loss):

 

 

 

 

 

 

Foreign currency translation

 

197

 

 

197

Unrealized net loss on investments

 

(173,046)

 

36,664

 

(136,382)

Change in fair value of cash flow hedges

 

170

 

(42)

 

128

Amounts reclassified into earnings on hedging activities

 

566

 

(139)

 

427

Total other comprehensive income (loss)

 

(172,113)

 

36,483

 

(135,630)

 

 

 

 

 

 

 

Total comprehensive income

$

268,943

$

(70,571)

$

198,372

 

 

+  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Quarter Ended June 30, 2021

 

Pre-tax

 

Tax

 

Net

 

 

(Unaudited)

 

 

(In thousands)

Comprehensive income:

 

 

 

 

 

 

Net earnings

$

454,750

$

(109,575)

$

345,175

Other comprehensive income (loss):

 

 

 

 

 

 

Foreign currency translation

 

(3,392)

 

 

(3,392)

Unrealized net loss on investments

 

(92,451)

 

19,424

 

(73,027)

Change in fair value of cash flow hedges

 

(68)

 

17

 

(51)

Amounts reclassified into earnings on hedging activities

 

987

 

(242)

 

745

Total other comprehensive income (loss)

 

(94,924)

 

19,199

 

(75,725)

 

 

 

 

 

 

 

Total comprehensive income

$

359,826

$

(90,376)

$

269,450

 

The accompanying notes are an integral part of these condensed consolidated financial statements.

3

 



 

 

Amerco and consolidated subsidiaries

condensed consolidated statements of changes in stockholders’ equity

 

 

Common Stock

 

Additional Paid-In Capital

 

Accumulated Other Comprehensive

Income (Loss)

 

Retained Earnings

 

Less: Treasury Common Stock

 

Less: Treasury Preferred Stock

 

Total Stockholders' Equity

 

(Unaudited)

 

(In thousands)

Balance as of March 31, 2022

$

10,497

$

453,819

$

46,384

$

6,052,233

$

(525,653)

$

(151,997)

$

5,885,283

Foreign currency translation

 

 

 

197

 

 

 

 

197

Unrealized net loss on investments, net of tax

 

 

 

(136,382)

 

 

 

 

(136,382)

Change in fair value of cash flow hedges, net of tax

 

 

 

128

 

 

 

 

128

Amounts reclassified into earnings on hedging activities

 

 

 

427

 

 

 

 

427

Net earnings

 

 

 

 

334,002

 

 

 

334,002

Common stock dividends: ($ 0.50 per share for fiscal 2023)

 

 

 

 

(9,804)

 

 

 

(9,804)

Net activity

 

 

 

(135,630)

 

324,198

 

 

188,568

Balance as of June 30, 2022

$

10,497

$

453,819

$

(89,246)

$

6,376,431

$

(525,653)

 

(151,997)

$

6,073,851

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance as of March 31, 2021

$

10,497

$

453,819

$

106,857

$

4,958,359

$

(525,653)

$

(151,997)

$

4,851,882

Foreign currency translation

 

 

 

(3,392)

 

 

 

 

(3,392)

Unrealized net loss on investments, net of tax

 

 

 

(73,027)

 

 

 

 

(73,027)

Change in fair value of cash flow hedges, net of tax

 

 

 

(51)

 

 

 

 

(51)

Amounts reclassified into earnings on hedging activities

 

 

 

745

 

 

 

 

745

Net earnings

 

 

 

 

345,175

 

 

 

345,175

Common stock dividends: ($ 0.50 per share for fiscal 2022)

 

 

 

 

(9,804)

 

 

 

(9,804)

Net activity

 

 

 

(75,725)

 

335,371

 

 

 

259,646

Balance as of June 30, 2021

$

10,497

$

453,819

$

31,132

$

5,293,730

$

(525,653)

$

(151,997)

$

5,111,528

 

The accompanying notes are an integral part of these condensed consolidated financial statements.

4

 



 

AMERCO AND CONSOLIDATED subsidiaries

Condensed consolidatED statements of cash flows

 

 

Quarter Ended June 30,

 

 

2022

 

2021

 

 

(Unaudited)

 

 

(In thousands)

Cash flows from operating activities:

 

 

 

 

Net earnings

$  

334,002

$  

345,175

Adjustments to reconcile net earnings to cash provided by operations:

 

 

 

 

Depreciation

 

178,144

 

172,040

Amortization of deferred policy acquisition costs

 

7,672

 

8,823

Amortization of premiums and accretion of discounts related to investments, net

 

4,929

 

4,361

Amortization of debt issuance costs

 

1,473

 

1,332

Interest credited to policyholders

 

15,157

 

15,583

Provision for allowance for losses on trade receivables

 

(6,151)

 

(484)

Provision for allowance for inventories and parts reserves

 

4,646

 

3,403

Net gains on disposal of personal property

 

(64,348)

 

(50,323)

Net (gains) losses on disposal of real estate

 

2,307

 

(4,430)

Net (gains) losses on sales of investments

 

268

 

(2,469)

Net (gains) losses on equity investments

 

1,551

 

(2,231)

Deferred income taxes

 

63,493

 

82,374

Net change in other operating assets and liabilities:

 

 

 

 

Reinsurance recoverables and trade receivables

 

15,894

 

(8,082)

Inventories and parts

 

(10,347)

 

(15,765)

Prepaid expenses

 

4,935

 

162,706

Capitalization of deferred policy acquisition costs

 

(7,398)

 

(8,990)

Other assets

 

1,935

 

(853)

Related party assets

 

484

 

562

Accounts payable and accrued expenses

 

74,676

 

71,599

Policy benefits and losses, claims and loss expenses payable

 

10,386

 

9,064

Other policyholders' funds and liabilities

 

1,187

 

(1,430)

Deferred income

 

14,448

 

11,863

Related party liabilities

 

2,028

 

385

Net cash provided by operating activities

 

651,371

 

794,213

 

 

 

 

 

Cash flows from investing activities:

 

 

 

 

Escrow deposits

 

4,789

 

1,887

Purchases of:

 

 

 

 

Property, plant and equipment

 

(646,137)

 

(508,411)

Short term investments

 

(22,017)

 

(11,810)

Fixed maturities investments

 

(36,488)

 

(281,507)

Equity securities

 

(1,366)

 

Preferred stock

 

 

(8,000)

Real estate

 

 

(67)

Mortgage loans

 

(42,561)

 

(42,538)

Proceeds from sales and paydowns of:

 

 

 

 

Property, plant and equipment

 

159,180

 

182,146

Short term investments

 

18,073

 

12,558

Fixed maturities investments

 

55,808

 

126,956

Equity securities

 

362

 

Mortgage loans

 

32,345

 

5,628

Net cash used by investing activities

 

(478,012)

 

(523,158)

 

 

 

 

 

Cash flows from financing activities:

 

 

 

 

Borrowings from credit facilities

 

393,264

 

161,854

Principal repayments on credit facilities

 

(145,369)

 

(109,334)

Payment of debt issuance costs

 

(1,069)

 

(352)

Finance lease payments

 

(34,982)

 

(45,170)

Common stock dividends paid

 

(9,804)

 

Investment contract deposits

 

85,767

 

113,779

Investment contract withdrawals

 

(62,911)

 

(64,332)

Net cash provided by financing activities

 

224,896

 

56,445

 

 

 

 

 

Effects of exchange rate on cash

 

(4,121)

 

(1,531)

 

 

 

 

 

Increase in cash and cash equivalents

 

394,134

 

325,969

Cash and cash equivalents at the beginning of period

 

2,704,137

 

1,194,012

Cash and cash equivalents at the end of period

$  

3,098,271

$  

1,519,981

 

The accompanying notes are an integral part of these condensed consolidated financial statements

5

 



amerco and consolidated subsidiaries

notes to condensed consolidated financial statements

1.Basis of Presentation

AMERCO, a Nevada corporation (“AMERCO”), has a first fiscal quarter that ends on the 30 th of June for each year that is referenced. Our insurance company subsidiaries have a first quarter that ends on the 31 st of March for each year that is referenced. They have been consolidated on that basis. Our insurance companies’ financial reporting processes conform to calendar year reporting as required by state insurance departments. Management believes that consolidating their calendar year into our fiscal year financial statements does not materially affect the presentation of financial position or results of operations. We disclose material events, if any, occurring during the intervening period. Consequently, all references to our insurance subsidiaries’ years 2022 and 2021 correspond to fiscal 2023 and 2022 for AMERCO.

Accounts denominated in non-U.S. currencies have been translated into U.S. dollars.

The condensed consolidated balance sheet as of June 30, 2022 and the related condensed consolidated statements of operations, comprehensive income (loss), stockholders’ equity and cash flows for the first quarter of fiscal 2023 and 2022 are unaudited.

In our opinion, all adjustments necessary for the fair presentation of such condensed consolidated financial statements have been included. Such adjustments consist only of normal recurring items. Interim results are not necessarily indicative of results for a full year. The information in this Quarterly Report on Form 10-Q (“Quarterly Report”) should be read in conjunction with the audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended March 31, 2022.

Intercompany accounts and transactions have been eliminated.

Description of Legal Entities

AMERCO is the holding company for:

U-Haul International, Inc. (“U-Haul”);

Amerco Real Estate Company (“Real Estate”);

Repwest Insurance Company (“Repwest”); and

Oxford Life Insurance Company (“Oxford”).

Unless the context otherwise requires, the terms “Company,” “we,” “us” or “our” refer to AMERCO and all of its legal subsidiaries.

Description of Operating Segments

AMERCO has three ( 3 ) reportable segments. They are Moving and Storage, Property and Casualty Insurance and Life Insurance.

The Moving and Storage operating segment (“Moving and Storage”) includes AMERCO, U-Haul and Real Estate and the wholly owned subsidiaries of U-Haul and Real Estate. Operations consist of the rental of trucks and trailers, sales of moving supplies, sales of towing accessories, sales of propane, and the rental of fixed and portable moving and storage units to the “do-it-yourself” mover and management of self-storage properties owned by others. Operations are conducted under the registered trade name U-Haul ® throughout the United States and Canada.

The Property and Casualty Insurance operating segment (“Property and Casualty Insurance”) includes Repwest and its wholly owned subsidiaries and ARCOA Risk Retention Group (“ARCOA”). Property and Casualty Insurance provides loss adjusting and claims handling for U-Haul ® through regional offices in the United States and Canada. Property and Casualty Insurance also underwrites components of the Safemove ® , Safetow ® , Safemove Plus ® , Safestor ® and Safestor Mobile ® protection packages to U-Haul customers. The business plan for Property and Casualty Insurance includes offering property and casualty insurance products in other U-Haul-related programs. ARCOA is a group captive insurer owned by us and our wholly owned subsidiaries whose purpose is to provide insurance products related to our moving and storage business.

The Life Insurance operating segment (“Life Insurance”) includes Oxford and its wholly owned subsidiaries. Life Insurance provides life and health insurance products primarily to the senior market through the direct writing and reinsuring of life insurance, Medicare supplement and annuity policies.

2. Investments

Expected maturities may differ from contractual maturities as borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

6

 



amerco and consolidated subsidiaries

notes to condensed consolidated financial statements – (continued)

We deposit bonds with insurance regulatory authorities to meet statutory requirements. The adjusted cost of bonds on deposit with insurance regulatory authorities was $ 23.8 million and $ 27.1 million as of March 31, 2022 and December 31, 2021, respectively.

Available-for-Sale Investments

Available-for-sale investments as of June 30, 2022 were as follows:

 

 

 

Cost

Amortized

 

Unrealized

Gains

Gross

 

Unrealized

Losses More than 12 Months

Gross

 

Unrealized

Losses Less than 12 Months

Gross

 

Allowance for Expected Credit Losses

 

Market

Value

Estimated

 

 

(Unaudited)

 

 

(In thousands)

U.S. treasury securities and government obligations

$

127,940

$  

2,947

$  

(1,578)

$  

(2,493)

$  

$  

126,816

U.S. government agency mortgage-backed securities

 

37,806

 

149

 

(380)

 

(4,126)

 

 

33,449

Obligations of states and political subdivisions

 

166,572

 

5,830

 

(1,275)

 

(2,009)

 

 

169,118

Corporate securities

 

1,970,857

 

38,302

 

(11,259)

 

(51,863)

 

(77)

 

1,945,960

Mortgage-backed securities

 

337,023

 

2,206

 

(1)

 

(16,372)

 

 

322,856

 

$

2,640,198

$  

49,434

$  

( 14,493 )

$  

( 76,863 )

$  

( 77 )

$  

2,598,199

 

Available-for-sale investments as of March 31, 2022 were as follows:

 

 

 

Cost

Amortized

 

Unrealized

Gains

Gross

 

Unrealized

Losses More than 12 Months

Gross

 

Unrealized

Losses Less than 12 Months

Gross

 

Allowance for Expected Credit Losses

 

Market

Value

Estimated

 

 

 

 

 

(In thousands)

U.S. treasury securities and government obligations

$

128,078

$  

7,984

$  

$  

(969)

$  

$  

135,093

U.S. government agency mortgage-backed securities

 

44,678

 

280

 

(42)

 

(3,111)

 

 

41,805

Obligations of states and political subdivisions

 

178,040

 

15,450

 

 

(508)

 

 

192,982

Corporate securities

 

1,989,212

 

138,909

 

(402)

 

(6,604)

 

(60)

 

2,121,055

Mortgage-backed securities

 

324,029

 

7,671

 

(1)

 

(1,542)

 

 

330,157

 

$

2,664,037

$  

170,294

$  

( 445 )

$  

( 12,734 )

$  

( 60 )

$  

2,821,092

 

We sold available-for-sale securities with a fair value of $ 54.1 million during the first quarter of fiscal 2023 and $ 352.3 million for the full year of fiscal 2022. The gross realized gains on these sales totaled $ 0.3 million during the first quarter of fiscal 2023 and $ 9.5 million for the full year of fiscal 2022.   The gross realized losses on these sales totaled $ 0.1 million during the first quarter of fiscal 2023 and $ 1.4 million for the full year of fiscal 2022.

For available-for-sale debt securities in an unrealized loss position, we first assess whether the security is below investment grade.  For securities that are below investment grade, we evaluate whether the decline in fair value has resulted from credit losses or other factors such as the interest rate environment. Declines in value due to credit are recognized as an allowance. In making this assessment, management considers the extent to which fair value is less than amortized cost, any changes to the rating of the security by a rating agency, and adverse market conditions specifically related to the security, among other factors.  If this assessment indicates that a credit loss exists, cumulative default rates based on ratings are used to determine the potential cost of default, by year.  The present value of these potential costs is then compared to the amortized cost of the security to determine the credit loss, limited by the amount that the fair value is less than the amortized cost basis.

7

 



amerco and consolidated subsidiaries

notes to condensed consolidated financial statements – (continued)

Declines in fair value that have not been recorded through an allowance for credit losses, such as declines due to changes in market interest rates, are recorded through accumulated other comprehensive income, net of applicable taxes. If we intend to sell a security, or it is more likely than not that we will be required to sell the security before recovery of its amortized cost basis, the security is written down to its fair value and the write down is charged against the allowance for credit losses, with any incremental impairment reported in earnings. Reversals of the allowance for credit losses are permitted and should not exceed the allowance amount initially recognized.

Changes in the allowance for credit losses are recorded as provision for (or reversal of) credit loss expense. There was a $ 17 thousand net impairment charge recorded in the first quarter ended June 30, 2022.

The adjusted cost and estimated market value of available-for-sale investments by contractual maturity were as follows:

 

 

June 30, 2022

 

March 31, 2022

 

 

Cost

Amortized

 

Market

Value

Estimated

 

Cost

Amortized

 

Market

Value

Estimated

 

 

(Unaudited)

 

 

 

 

(In thousands)

Due in one year or less

$

104,389

$

105,325

$

97,969

$

99,432

Due after one year through five years

 

554,348

 

557,915

 

541,840

 

570,135

Due after five years through ten years

 

713,435

 

717,393

 

704,295

 

765,073

Due after ten years

 

931,003

 

894,710

 

995,904

 

1,056,295

 

 

2,303,175

 

2,275,343

 

2,340,008

 

2,490,935

 

 

 

 

 

 

 

 

 

Mortgage-backed securities

 

337,023

 

322,856

 

324,029

 

330,157

 

$

2,640,198

$

2,598,199

$

2,664,037

$

2,821,092

As of June 30, 2022 and March 31, 2022, our common stock and non-redeemable preferred stock that are included in Investments, fixed maturities and marketable equities on our balance sheet are stated in the table below. The changes in the fair value of these equity investments are recognized through Net investment and interest income.

Equity investments of common stock and non-redeemable preferred stock were as follows:

 

 

June 30, 2022

 

March 31, 2022

 

 

Cost

Amortized

 

Market

Value

Estimated

 

Cost

Amortized

 

Market

Value

Estimated

 

 

(Unaudited)

 

 

 

 

 

 

(In thousands)

 

 

 

 

 

 

 

 

 

Common stocks

$

28,707

$

45,837

$

27,674

$

46,212

Non-redeemable preferred stocks

 

26,054

 

25,950

 

26,054

 

26,095

 

$

54,761

$

71,787

$

53,728

$

72,307

 

Investments, other

The carrying value of the other investments was as follows:

 

 

June 30,