• Third Quarter Earnings: $67 million, down from $99 million in the same quarter last year.
• Earnings Per Share: $0.35 per nonvoting share, compared to $0.51 per nonvoting share last year.
• EBITDA Increase: $47.8 million in the moving and storage segment.
• Equipment Rental Revenue: Increased by $39 million, over 4.5% for the quarter.
• Capital Expenditures: $1.587 billion for new rental equipment in the first nine months, a $237 million increase from last year.
• Self-Storage Revenue: Up $17 million, an 8% increase for the quarter.
• Average Revenue Per Occupied Foot: Improved by approximately 90 basis points.
• Occupied Unit Count: Increased by nearly 42,000 units compared to last year.
• New Units Added: 80,000 new units added over the same timeframe.
• Average Occupancy: Declined to 78.7% across the whole portfolio.
• Real Estate Investments: $1.214 billion in the first nine months, a $245 million increase over last year.
• U-Box Revenue: Increased by $9 million, with growth in both moving and storage transactions.
• Operating Expenses: Increased by $11.6 million in the moving and storage segment.
• Cash and Loan Facilities: Totaled $1.348 billion as of December 2024.

• Warning! GuruFocus has detected 7 Warning Signs with UHAL.

Release Date: February 06, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• U-Haul Holding Co (NYSE:UHAL) reported a $39 million increase in equipment rental revenue, marking a growth of over 4.5% for the quarter.
• The U-Box business continues to grow, with both moving and storage transactions increasing, contributing significantly to other revenue.
• Self-storage revenues increased by $17 million, an 8% rise for the quarter, with average revenue per occupied foot improving by 90 basis points.
• The company added 2.3 million new net rentable square feet, with a significant portion being newly developed locations.
• U-Haul Holding Co (NYSE:UHAL) has a robust pipeline for U-Box warehouse growth, with plans to continue expanding storage capacity over the next 12 months.

Negative Points

• Third quarter earnings decreased to $67 million from $99 million in the same quarter last year, with earnings per share dropping from $0.51 to $0.35.
• The decline in earnings was attributed to increased fleet depreciation, reduced gains on the sale of retired equipment, and a decrease in interest income.
• The average occupancy across the self-storage portfolio declined to 78.7%, with the same-store occupancy decreasing by 50 basis points to 92.4%.
• Proceeds from the sales of retired equipment decreased by $73 million, contributing to increased depreciation costs.
• The company faces challenges from electric vehicle mandates, which could impact the availability and cost of medium-duty trucks in the future.

Q & A Highlights

Q: What are the drivers behind the recent revenue growth, and how is the pricing environment affecting U-Haul? A: Edward Shoen, Chairman, President & CEO, explained that while there have been cost increases over the past 36 months, U-Haul has been cautious about passing these onto customers. The company aims to communicate value before implementing price hikes. Despite rising costs in equipment acquisition and personnel, customers have shown a willingness to accept some price increases, which has contributed to revenue growth.

Q: How has U-Haul managed to control operating expenses despite revenue growth? A: Edward Shoen noted that there is often a delayed reaction in financial results following internal cost control measures. The company has been focusing on cost management, which has started to reflect in the financial outcomes, with operating expenses rising only 1.6% compared to a 4% to 7% increase in sales.

Q: Can you provide insights into the growth and future expectations for U-Box, particularly in terms of storage versus rental? A: Samuel Shoen, Vice Chairman of the Board and U-Box Project Manager, highlighted that U-Box is seeing growth in both moving and storage transactions. The company is focusing on educating customers about the versatility of U-Box, which is leading to more conversions to self-storage. The storage aspect of U-Box is seen as a significant growth area.

Q: How is U-Haul positioned in terms of market share and pricing strategy in the moving business? A: Edward Shoen emphasized that U-Haul's extensive distribution network gives it a competitive edge, allowing access to customers that competitors cannot economically reach. While pricing needs to remain competitive, U-Haul is well-positioned to benefit from any increase in consumer activity due to its fleet and location advantages.

Q: What is the impact of electric vehicle mandates on U-Haul's business, and how is the company responding? A: Edward Shoen discussed the challenges posed by electric vehicle mandates, particularly those driven by California. He noted that there is currently no viable electric solution for the medium-duty trucks U-Haul rents. The company is cautious about investing in electric vehicles without a clear economic benefit and is hoping for regulatory flexibility that allows for both electric and internal combustion engine vehicles.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.