AMERCO Earnings 2019-12-31

UHAL 10Q Quarterly Report

Balance Sheet	Income Statement	Cash Flow

Comparables ($MM TTM)
Ticker	M Cap	Assets	Liab	Rev	G Profit	Net Inc	EBITDA	EV	G Margin	EV/EBITDA	ROA
UHAL	7,375	12,475	8,606	3,109	2,948	375	1,193	6,855	95%	5.7	3%
G	7,280	4,013	2,429	3,274	1,169	287	493	7,895	36%	16.0	7%
FIVE	7,224	1,659	1,007	1,698	612	157	246	7,045	36%	28.7	9%
R	2,886	14,522	11,914	8,842	0	318	612	9,413	0%	15.4	2%
CAR	2,643	24,455		9,085	0	286	620	5,593	0%	9.0	1%
HTZ	1,605	26,354	25,287	9,670	0	-61	3	951	0%	317.1	-0%
EHIC	1,594	10,928	6,722	0	0	0	0	5,675			0%
SP	842	1,492	1,110	1,563	209	52	109	1,192	13%	11.0	3%
HYRE	52	6	2	8	7	-8	-8	47	88%	-5.8	-137%

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

(Mark One)

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

For the quarterly period ended December 31, 2019

[ ]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	Registrant, State of Incorporation, Address and Telephone Number	I.R.S. Employer Identification No.



001-11255	AMERCO	88-0106815
	(A Nevada Corporation)
	5555 Kietzke Lane Suite 100
	Reno NV 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 [x] 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 [x] 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 [x] 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 [x]

19,607,788 shares of AMERCO Common Stock, $0.25 par value, were outstanding at January 31, 2020.

TABLE OF CONTENTS

		Page
	PART I FINANCIAL INFORMATION
Item 1.	Financial Statements
	a) Condensed Consolidated Balance Sheets as of December 31, 2019 (unaudited) and March 31, 2019	1
	b) Condensed Consolidated Statements of Operations for the Quarters Ended December 31, 2019 and 2018 (unaudited)	2
	c) Condensed Consolidated Statements of Operations for the Nine Months Ended December 31, 2019 and 2018 (unaudited)	3
	d) Condensed Consolidated Statements of Comprehensive Income (Loss) for the Quarters and Nine Months Ended December 31, 2019 and 2018 (unaudited)	4
	e) Condensed Consolidated Statements of Changes in Stockholders’ Equity for the Quarters Ended December 31, 2019 and 2018 (unaudited)	5
	f) Condensed Consolidated Statements of Changes in Stockholders’ Equity for the Nine Months Ended December 31, 2019 and 2018 (unaudited)	6
	g) Condensed Consolidated Statements of Cash Flows for the Nine Months Ended December 31, 2019 and 2018 (unaudited)	7
	h) Notes to Condensed Consolidated Financial Statements (unaudited)	8
Item 2 .	Management’s Discussion and Analysis of Financial Condition and Results of Operations	44
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	61
Item 4.	Controls and Procedures	63

	PART II OTHER INFORMATION
Item 1.	Legal Proceedings	64
Item 1A.	Risk Factors	64
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	64
Item 3.	Defaults Upon Senior Securities	64
Item 4.	Mine Safety Disclosures	64
Item 5.	Other Information	64
Item 6.	Exhibits	64

Part i Financial information

Item 1. Financial Statements

AMERCO AND CONSOLIDATED SUBSIDIARIES

CONDENSED CONSOLIDATED balance sheets

		December 31,		March 31,
		2019		2019
		(Unaudited)
		(In thousands, except share data)
ASSETS
Cash and cash equivalents	$	631,951	$	673,701
Reinsurance recoverables and trade receivables, net		200,164		224,785
Inventories and parts, net		103,003		103,504
Prepaid expenses		188,780		174,100
Investments, fixed maturities and marketable equities		2,469,468		2,235,397
Investments, other		336,727		300,736
Deferred policy acquisition costs, net		106,354		136,276
Other assets		71,821		78,354
Right of use assets - financing, net		1,130,473		–
Right of use assets - operating		107,974		–
Related party assets		47,988		30,889
		5,394,703		3,957,742
Property, plant and equipment, at cost:
Land		1,018,010		976,454
Buildings and improvements		4,522,855		4,003,726
Furniture and equipment		733,063		689,780
Rental trailers and other rental equipment		511,872		590,039
Rental trucks		3,454,759		4,762,028
		10,240,559		11,022,027
Less: Accumulated depreciation		(2,640,940)		(3,088,056)
Total property, plant and equipment, net		7,599,619		7,933,971
Total assets	$	12,994,322	$	11,891,713
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Accounts payable and accrued expenses	$	551,770	$	556,873
Notes, loans and finance/capital leases payable, net		4,548,609		4,163,323
Operating lease liability		107,581		–
Policy benefits and losses, claims and loss expenses payable		1,015,663		1,011,183
Liabilities from investment contracts		1,753,428		1,666,742
Other policyholders' funds and liabilities		12,924		15,047
Deferred income		31,459		35,186
Deferred income taxes, net		869,671		750,970
Total liabilities		8,891,105		8,199,324

Commitments and contingencies (notes 4, 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 December 31 and March 31, 2019
Series B preferred stock, with no par value, 100,000 shares authorized; none
issued and outstanding as of December 31 and March 31, 2019
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 December 31 and March 31, 2019
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 December 31 and March 31, 2019		10,497		10,497
Additional paid-in capital		453,819		453,326
Accumulated other comprehensive income (loss)		39,517		(66,698)
Retained earnings		4,277,034		3,976,962
Cost of common stock in treasury, net (22,377,912 shares as of December 31 and March 31, 2019)		(525,653)		(525,653)
Cost of preferred stock in treasury, net (6,100,000 shares as of December 31 and March 31, 2019)		(151,997)		(151,997)
Unearned employee stock ownership plan shares		–		(4,048)
Total stockholders' equity		4,103,217		3,692,389
Total liabilities and stockholders' equity	$	12,994,322	$	11,891,713

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

AMERCO AND CONSOLIDATED SUBSIDIARIES

CONDENSED CONSOLIDATED Statements of operations

		Quarter Ended December 31,
		2019		2018
		(Unaudited)
		(In thousands, except share and per share amounts)
Revenues:
Self-moving equipment rentals	$	621,471	$	626,136
Self-storage revenues		106,701		93,392
Self-moving and self-storage products and service sales		54,454		55,665
Property management fees		9,098		7,899
Life insurance premiums		31,164		34,778
Property and casualty insurance premiums		19,267		17,668
Net investment and interest income		33,782		32,211
Other revenue		51,943		51,342
Total revenues		927,880		919,091

Costs and expenses:
Operating expenses		517,453		478,461
Commission expenses		66,542		67,493
Cost of sales		35,318		34,149
Benefits and losses		42,864		42,869
Amortization of deferred policy acquisition costs		8,046		6,654
Lease expense		6,490		7,890
Depreciation, net of (gains)/losses on disposal of ($2,151 and ($796), respectively)		170,074		143,473
Net losses on disposal of real estate		528		–
Total costs and expenses		847,315		780,989

Earnings from operations		80,565		138,102
Other components of net periodic benefit costs		(263)		(253)
Interest expense		(39,973)		(34,827)
Pretax earnings		40,329		103,022
Income tax expense		(9,397)		(24,387)
Earnings available to common stockholders	$	30,932	$	78,635
Basic and diluted earnings per common stock	$	1.58	$	4.01
Weighted average common stock outstanding: Basic and diluted		19,607,788		19,591,963

Related party revenues for the third quarter of fiscal 2020 and 2019, net of eliminations, were $ 9.1 million and $ 7.9 million, respectively.

Related party costs and expenses for the third quarter of fiscal 2020 and 2019, net of eliminations, were $ 14.8 million and $ 15.0 million, respectively.

Please see Note 10, 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.

AMERCO AND CONSOLIDATED SUBSIDIARIES

CONDENSED CONSOLIDATED Statements of operations

		Nine Months Ended December 31,
		2019		2018
		(Unaudited)
		(In thousands, except share and per share amounts)
Revenues:
Self-moving equipment rentals	$	2,174,392	$	2,124,451
Self-storage revenues		309,940		271,097
Self-moving and self-storage products and service sales		207,601		207,819
Property management fees		23,487		22,507
Life insurance premiums		96,229		107,586
Property and casualty insurance premiums		51,056		46,732
Net investment and interest income		102,629		85,043
Other revenue		192,009		177,940
Total revenues		3,157,343		3,043,175

Costs and expenses:
Operating expenses		1,617,338		1,504,365
Commission expenses		233,540		232,084
Cost of sales		128,177		130,432
Benefits and losses		137,695		137,196
Amortization of deferred policy acquisition costs		20,625		18,584
Lease expense		19,882		24,229
Depreciation, net of gains on disposal of ($32,526 and $29,127, respectively)		462,227		402,525
Net (gains) losses on disposal of real estate		(1,311)		10
Total costs and expenses		2,618,173		2,449,425

Earnings from operations		539,170		593,750
Other components of net periodic benefit costs		(790)		(760)
Interest expense		(117,983)		(105,111)
Pretax earnings		420,397		487,879
Income tax expense		(100,717)		(117,853)
Earnings available to common stockholders	$	319,680	$	370,026
Basic and diluted earnings per common stock	$	16.31	$	18.89
Weighted average common stock outstanding: Basic and diluted		19,602,484		19,591,282

Related party revenues for the first nine months of fiscal 2020 and 2019, net of eliminations, were $ 23.5 million and $ 22.5 million, respectively.

Related party costs and expenses for the first nine months of fiscal 2020 and 2019, net of eliminations, were $ 51.9 million and $ 51.1 million, respectively.

Please see Note 10, 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.

AMERCO AND CONSOLIDATED SUBSIDIARIES

Condensed consolidatED statements of COMPREHENSIVE INCOME (loss)

Quarter Ended December 31, 2019		Pre-tax		Tax		Net
		(Unaudited)
		(In thousands)
Comprehensive income:
Net earnings	$	40,329	$	(9,397)	$	30,932
Other comprehensive income (loss):
Foreign currency translation		(692)		–		(692)
Unrealized net gain on investments		28,568		(6,190)		22,378
Change in fair value of cash flow hedges		479		(118)		361
Amounts reclassified into earnings on hedging activities		422		(103)		319
Total comprehensive income	$	69,106	$	(15,808)	$	53,298



Quarter Ended December 31, 2018		Pre-tax		Tax		Net
		(Unaudited)
		(In thousands)
Comprehensive income:
Net earnings	$	103,022	$	(24,387)	$	78,635
Other comprehensive income (loss):
Foreign currency translation		(4,101)				(4,101)
Unrealized net gain on investments		1,827		(384)		1,443
Change in fair value of cash flow hedges		(1,001)		246		57
Amounts reclassified into earnings on hedging activities		886		(218)		(144)
Total comprehensive income	$	100,633	$	(24,743)	$	75,890

Nine Months Ended December 31, 2019		Pre-tax		Tax		Net
		(Unaudited)
		(In thousands)
Comprehensive income:
Net earnings	$	420,397	$	(100,717)	$	319,680
Other comprehensive income (loss):
Foreign currency translation		2,919				2,919
Unrealized net gain on investments		133,046		(28,575)		104,471
Change in fair value of cash flow hedges		(1,555)		382		(1,173)
Amounts reclassified into earnings on hedging activities		(3)		1		(2)
Total comprehensive income	$	554,804	$	(128,909)	$	425,895



Nine Months Ended December 31, 2018		Pre-tax		Tax		Net
		(Unaudited)
		(In thousands)
Comprehensive income:
Net earnings	$	487,879	$	(117,853)	$	370,026
Other comprehensive income (loss):
Foreign currency translation		(5,081)				(5,081)
Unrealized net loss on investments		(70,671)		14,841		(55,830)
Change in fair value of cash flow hedges		700		(172)		528
Amounts reclassified into earnings on hedging activities		31		(8)		23
Total comprehensive income	$	412,858	$	(103,192)	$	309,666

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

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		Less: Unearned Employee Stock Ownership Plan Shares		Total Stockholders' Equity
	(Unaudited)
	(In thousands, except per share amounts)
Balance as of September 30, 2019	$	10,497	$	453,761	$	17,151	$	4,255,906	$	(525,653)	$	(151,997)	$	(1,597)	$	4,058,068
Increase in market value of released ESOP shares		–		58		–		–		–		–		–		58
Release of unearned ESOP shares		–		–		–		–		–		–		1,597		1,597
Purchase of ESOP shares		–		–		–		–		–		–		–		–
Foreign currency translation		–		–		(692)		–		–		–		–		(692)
Unrealized net gain on investments, net of tax		–		–		22,378		–		–		–		–		22,378
Change in fair value of cash flow hedges, net of tax		–		–		361		–		–		–		–		361
Amounts reclassified into earnings on hedging activities		–		–		319		–		–		–		–		319
Net earnings		–		–		–		30,932		–		–		–		30,932
Common stock dividends: ($0.50 per share for fiscal 2020)		–		–		–		(9,804)		–		–		–		(9,804)
Net activity		–		58		22,366		21,128		–		–		1,597		45,149
Balance as of December 31, 2019	$	10,497	$	453,819	$	39,517	$	4,277,034	$	(525,653)	$	(151,997)	$	–	$	4,103,217

Balance as of September 30, 2018	$	10,497	$	453,006	$	(62,238)	$	3,917,087	$	(525,653)	$	(151,997)	$	(7,535)	$	3,633,167
Increase in market value of released ESOP shares		–		110		–		–		–		–		–		110
Release of unearned ESOP shares		–		–		–		–		–		–		2,695		2,695
Purchase of ESOP shares		–		–		–		–		–		–		(303)		(303)
Foreign currency translation		–		–		(4,101)		–		–		–		–		(4,101)
Unrealized net loss on investments, net of tax		–		–		(8,281)		–		–		–		–		(8,281)
Change in fair value of cash flow hedges, net of tax		–		–		57		–		–		–		–		57
Amounts reclassified into earnings on hedging activities		–		–		(144)		–		–		–		–		(144)
Net earnings		–		–		–		78,635		–		–		–		78,635
Common stock dividends: ($0.50 per share for fiscal 2019)		–		–		–		(9,795)		–		–		–		(9,795)
Net activity		–		110		(12,469)		68,840		–		–		2,392		58,873
Balance as of December 31, 2018	$	10,497	$	453,116	$	(74,707)	$	3,985,927	$	(525,653)	$	(151,997)	$	(5,143)	$	3,692,040

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

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

Less: Unearned Employee Stock Ownership Plan Shares

Total Stockholders' Equity

(Unaudited)

(In thousands, except per share amounts)

Balance as of March 31, 2019

10,497

453,326

(66,698)

3,976,962

(525,653)

(151,997)

(4,048)

3,692,389

Increase in market value of released ESOP shares

–

493

–

493

Release of unearned ESOP shares

–

4,253

Purchase of ESOP shares

–

(205)

Foreign currency translation

–

2,919

–

2,919

Unrealized net gain on investments, net of tax

–

104,471

–

104,471

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

–

(1,173)

–

(1,173)

Amounts reclassified into earnings on hedging activities

–

(2)

–

(2)

Net earnings

–

319,680

–

319,680

Common stock dividends: ($1.00 per share for fiscal 2020)

–

(19,608)

–

(19,608)

Net activity

–

493

106,215

300,072

Closing Price ($)	Shares Out (MM)	Market Cap ($MM)
$0.00	20	$7,375

10-Q	2020-02-05	Quarter: 2019-12-31
10-Q	2019-11-06	Quarter: 2019-09-30
10-Q	2019-08-07	Quarter: 2019-06-30
10-K	2019-05-29	Annual: 2019-03-31
10-Q	2019-02-06	Quarter: 2018-12-31
10-Q	2018-11-07	Quarter: 2018-09-30
10-Q	2018-08-08	Quarter: 2018-06-30
10-K	2018-05-30	Annual: 2018-03-31
10-Q	2018-02-07	Quarter: 2017-12-31
10-Q	2017-11-08	Quarter: 2017-09-30
10-Q	2017-08-09	Quarter: 2017-06-30
10-K	2017-05-24	Annual: 2017-03-31
10-Q	2017-02-08	Quarter: 2016-12-31
10-Q	2016-11-09	Quarter: 2016-09-30
10-Q	2016-08-03	Quarter: 2016-06-30
10-K	2016-05-25	Annual: 2016-03-31
10-Q	2016-02-03	Quarter: 2015-12-31
10-Q	2015-11-04	Quarter: 2015-09-30
10-Q	2015-08-05	Quarter: 2015-06-30
10-K	2015-05-27	Annual: 2015-03-31
10-Q	2015-02-04	Quarter: 2014-12-31
10-Q	2014-11-05	Quarter: 2014-09-30
10-Q	2014-08-06	Quarter: 2014-06-30
10-K	2014-05-28	Annual: 2014-03-31
10-Q	2014-02-05	Quarter: 2013-12-31
10-Q	2013-11-06	Quarter: 2013-09-30
10-Q	2013-08-07	Quarter: 2013-06-30
10-K	2013-06-05	Annual: 2013-03-31
10-Q	2013-02-06	Quarter: 2012-12-31
10-Q	2012-11-07	Quarter: 2012-09-30
10-Q	2012-08-08	Quarter: 2012-06-30
10-K	2012-06-06	Annual: 2012-03-31
10-Q	2012-02-08	Quarter: 2011-12-31
10-Q	2011-11-02	Quarter: 2011-09-30
10-Q	2011-08-03	Quarter: 2011-06-30
10-K	2011-06-09	Annual: 2011-03-31
10-Q	2011-02-02	Quarter: 2010-12-31
10-Q	2010-11-03	Quarter: 2010-09-30
10-Q	2010-08-04	Quarter: 2010-06-30
10-K	2010-06-09	Annual: 2010-03-31
10-Q	2010-02-04	Quarter: 2009-12-31

8-K	2020-02-18	Exhibits
8-K	2020-01-10	Exhibits
8-K	2019-12-10	Exhibits
8-K	2019-12-04	Officers, Other Events, Exhibits
8-K	2019-11-06	Officers
8-K	2019-08-22	Shareholder Vote, Other Events, Exhibits
8-K	2019-08-02
8-K	2019-05-03	Exhibits
8-K	2019-05-03	Exhibits
8-K	2019-03-29
8-K	2019-03-07	Exhibits
8-K	2019-03-06	Other Events, Exhibits
8-K	2018-12-05	Other Events, Exhibits
8-K	2018-10-23	Exhibits
8-K	2018-08-28	Exhibits
8-K	2018-08-28	Exhibits
8-K	2018-08-23	Shareholder Vote, Other Events, Exhibits
8-K	2018-06-12	Other Events
8-K	2018-06-06	Other Events, Exhibits
8-K	2018-03-08	Other Events, Exhibits
8-K	2018-03-06	Exhibits

EX-31.1	ex311.htm
EX-31.2	ex312.htm
EX-32.1	ex321.htm
EX-32.2	ex322.htm