U-Haul pany(US:UHAL)2021-02-04 18:59Financial Data and Key Metrics Changes - The company reported third quarter earnings of $9.33 per share, a significant increase from $1.58 per share for the same period in fiscal 2020 [8] - Equipment rentals increased by 30%, approximately $187 million, while for the nine months, the increase was 10%, or $219 million [9] - Operating earnings in the moving and storage segment rose by $202 million to a total of $264 million for the quarter [19] - Cash and availability from existing loan facilities totaled $1.343 million at December 31 [21] Business Line Data and Key Metrics Changes - Retail product sales increased by $20 million or 37% for the quarter, with all major product lines reporting gains [18] - The self-storage segment saw revenues up by $16 million or 15%, with an increase of 66,900 occupied units compared to the same time last year [14] - Capital expenditures on new rental trucks and trailers were $541 million for the first nine months, down from $1.161 billion for the same period last year [11] Market Data and Key Metrics Changes - The company added over 29,000 new rooms during the first nine months of the year, compared to 59,000 rooms added in the same period last year [15] - The all-in blended occupancy rate increased from 67% last year to 73% this year [15] - Approximately 6.6 million new rentable square feet are in development across 134 projects [17] Company Strategy and Development Direction - The company aims to expand into more markets with company stores, focusing on areas that have not been economically viable in the past [45] - There is a goal to increase the pace of investment in self-storage and U-Box warehouse space, contingent on finding suitable opportunities [16] - The company is working to ramp up the manufacturing of new equipment to normalize fleet rotation over the next 1.5 to 2 years [12] Management's Comments on Operating Environment and Future Outlook - Management noted strong customer demand for self-moving products and services, attributing success to frontline teams and technology [9] - The company is cautious about future cash flow and plans to ramp back up CapEx programs while monitoring COVID-19 developments [76] - Management expressed confidence in the ability to adapt to changing consumer behavior and migration patterns, indicating a potential for sustained demand [49] Other Important Information - The company declared and paid a $2 per share special cash dividend during the third quarter [21] - Proceeds from the sales of retired rental equipment decreased by nearly $162 million to a total of $430 million for the first nine months of this year [13] Q&A Session Summary Question: Can you discuss the leverage of the business given the strong quarter? - Management indicated that 40% of the revenue increase was from transaction growth, with the remainder from revenue per transaction, primarily driven by rate increases [28] Question: How has the cost structure changed with revenue increases? - Personnel expenses increased only slightly, with the majority of the increase attributed to performance-based compensation for field teams [31] Question: What is the outlook for occupancy rates in self-storage? - Management expects occupancy rates to continue rising due to a pause in construction caused by COVID-19 [60] Question: How is the company adapting to changes in mobility and migration? - The company plans to continue expanding into new markets and enhancing its dealer network to meet demand [46] Question: What is the expected depreciation in the next fiscal year? - Depreciation is expected to trend upwards as production of new trucks resumes, with a significant impact anticipated from the timing of truck production [68]