Good morning, and welcome to the AMERCO Third Quarter Fiscal 2021 Investor Call and Webcast. All participants will be in a listen only mode. After today's presentation, there will be an opportunity to ask questions. Please note this event is being recorded. I would now like to turn the conference over to Sebastian Reyes.
Please go
ahead. Good morning, and thank you for joining us today. Welcome to the AMERCO Third Quarter Fiscal 2021 Investor Call. Before we begin, I'd like to remind everyone that certain of the statements during this call, including without limitation, statements regarding revenue, expenses, income and general growth of our business may constitute forward looking statements within the meaning of the Safe Harbor provisions of Section 27A of the Securities Act of 1933 as amended In Section 21E of the Securities Exchange Act of 1934 as amended, forward looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified. Certain factors could cause actual results to differ materially from those projected.
For a 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 December 31, 2020, which is on file with the U. S. Securities and Exchange Commission. At this time, I'll now turn the call over to Jason Berg, Chief Financial Officer of AMERCO.
Thanks, Sebastien. I'm speaking today from my office here in Phoenix, Arizona. Joe Shoen, our Chairman and CEO, is out traveling in the field working at some of our locations and is unable to be on the call today. After a few minutes of prepared remarks, then we'll go ahead and open it up for questions and answers after that. Yesterday, we reported 3rd quarter earnings of $9.33 a share compared to $1.58 a share for the same period fiscal 2020.
As usual throughout my presentations, all of my comparisons This will be for the Q3 of this year compared to the Q3 of last year unless otherwise noted. Over the course of the Q3, We continue to see strong customer demand for our self moving products and services. Our frontline teams have been answering the call since the onset of the pandemic and all of the government's responses to it. The efforts of our field teams, our independent dealers, combined with the technology that was already in place, put us in a superior position to serve moving and storage customers. Equipment rentals saw an increase of 30% were about $187,000,000 For the 9 months, we are now up 10% or $219,000,000 That's a good result under even normal conditions.
Compared to the same period last year, we increased the number of retail locations, Independent dealers, box trucks and trailers in the rental fleet. Of note, our corporate account business or what many referred to as last mile business, experienced an increase in revenue for the quarter. We've seen growth in u Move revenue continue for the month of January. Capital expenditures on new rental trucks and trailers were $541,000,000 for the 1st 9 months. That's down from $1,161,000,000 for the same 9 month period last year.
The combination of planned decreases along with COVID-nineteen delays are responsible for the decline. We're working to ramp up the manufacturing of new equipment as quickly as possible. Absent any additional unforeseen delays, it will likely take us a year and a half to 2 years to normalize our fleet rotation program. The investments that we've made in the fleet prior to this are what put us in the position to weather this supply disruption without negatively affecting our ability to serve customers. A rough estimate of fiscal year 2022 fleet CapEx would suggest that spending is going to be similar to that of fiscal 2020.
Proceeds from the sales of retired rental equipment decreased by nearly $162,000,000 to a total of $430,000,000 for the 1st 9 months of this year. Sales volume is still below last year's levels. However, sales prices have improved. The self storage industry as a whole continues to do well and we continue to have success in filling rooms. Looking at our occupied unit count at the end of December, we had an increase of 66,900 occupied units compared to the same During our Q2 earnings call, I reported to you September over September growth of 53,800 rooms.
So you can see the pace of filling rooms has continued to accelerate and is doing so as we go into January as well. Revenues for self storage were up $16,000,000 or 15%. For the 2nd quarter in a row now, our all in blended occupancy rate The 3rd quarter rate went from 67% last year to 73% this year. We've added just over 29,000 new rooms during the 1st 9 months of this year. Last year for the same 9 month period, we had added 59,000 rooms.
For the 1st 9 months of this year, we have invested $365,000,000 in real estate acquisitions as well as development of self storage in U Box warehouse space. That's down from $600,000,000 same time last year. Our goal is to increase the pace of investment. However, that's going to be Our ability to find opportunities that fit our economic model. We currently have approximately 6,600,000 New rentable square feet in development.
That's across 134 projects. We have an additional cohort of around 50 properties that are not yet in the active development phase, but that we own. As with equipment CapEx, growth in storage CapEx is going to take us some time to ramp back up. Retail product sales increased $20,000,000 or 37% for the quarter with all three of our major product lines reporting gains. These lines are moving supplies, hitches and towing accessories and propane.
We are seeing these improvements continue into the month of January. Operating earnings in our Moving and Storage segment increased $202,000,000 to a total of $264,000,000 for the quarter. For our 3 largest operating expense categories, personnel, maintenance and repair in the fleet and liability costs, We saw quarterly increases, but they were well below the rate of revenue increase. With the volume of rentals over the last 2 quarters, we will see another increase in repair and maintenance costs next quarter, but it should be well below the revenue trend. For personnel, the company has not recorded an expense this year yet for a contribution to the employee stock ownership plan That will likely be recognized in our Q4, whereas last year we spread that expense out over 4 quarters.
We continue to improve our cash and liquidity position. At December 31st this year, cash and availability from existing loan facilities in our Moving and Storage segment totaled $1,343,000,000 During our Q3, we declared and paid a $2 per share special cash dividend. With that, I would like to hand the call back to our operator, Raj Naveed, to begin the question and answer portion of the call. Thank you.
The first question comes from Stephen Ralston with Sachs. Please go ahead.
Good morning. Good morning. Congratulations on, I don't say this often, an amazing quarter. I'm looking through the numbers And historically in the 3rd fiscal quarter, the company has reported usually between $3 $4 Except for 1 year, we had a real estate transaction. And I thought I was very aggressive with my $7 plus estimate.
And you came in with $9 and it shows the extreme leverage of the business. If you could talk about that, because you were quite conservative on the second quarter fiscal quarter call saying that it was going to be a challenge in repositioning the vehicles, the driver being the rental business. And obviously you accomplished that. You sort of gave a one liner. Obviously there was strong consumer demand and you congratulated your field teams.
But could you talk about this leverage that you have When pricing and volume come in and you have this large infrastructure and you're able to utilize it better?
Sure. It's a great question. Thank you, Stephen. So I'll break it down into a couple of pieces, then I'll let you redirect if I start to wander too much. So during this quarter, I would say that of the revenue increase that you saw for equipment, Maybe 40% of that was coming from transaction growth.
The remainder of that is coming from What we refer to as revenue per transaction, which is a combination of either more miles driven per transaction, The mix of trucks that are being rented were rate. And I think what we saw during this quarter was the majority of that was in the So when you talk about from our last call shows concerns about The placement of equipment across the country, I don't think we've solved that to any large degree at all. We're We're coping with it and we're dealing with it. But we still have at any point in the year, there's always equipment dislocations. And I would say they're a little more pronounced through this cycle than what they've been in the past, But our teams are attempting to adapt to it, but there's certainly parts of the country that if you go to, say Nashville, you're going to see a lot more Equipment than you're used to seeing.
And we're still working through that. And one of the ways that we work through that is through the prices that we charge customers. So it's a natural supply and demand. And as the equipment Comes harder for us to put into certain places as rates go up and we saw the benefit of that during the quarter. So I'll let you redirect me if I haven't answered the whole question.
No, That's fine. Thank you. Also, I noticed that the it seems like A range in cost, your cost structure has gone down. Revenues went up 30 some percent and Costs were only up, I think 4%. Was there anything done in that area?
Well, our big three expenses, as I mentioned, personnel is our largest and we probably picked up the most margin there. As I think for The quarter, our personnel expense maybe only went up $5,000,000 $5,500,000 on a pretty significant increase in Revenue. And what we're seeing is the majority of that increase in personnel costs is coming from Field performance compensation. So our field was hit fairly hard in the Q1 of this year as transactions went down and revenue went down, Their adjustable or performance based compensation went down with it. So it was kind of tough on them.
Well, they've now In the last two quarters made that up and then some as a general comment. So, we're seeing Those bonus costs go up. But in total, we've been able to keep a lid on headcount. Our medical plan costs for the most part this year have remained relatively flat as I think the virus has kept people out of utilizing Medical Care that much. And then we have benefited for the 1st 9 months of the year, probably to the tune of about $11,000,000 on I mentioned the ESOP expense, but last year that cost was spread out evenly $3,000,000 or $4,000,000 a quarter, whereas this year It hasn't hit yet and it will probably hit here in the Q4, but that should still keep us in a margin positive area.
On maintenance and repair, we've sold fewer trucks. So the 2 biggest components of our repair and maintenance structure are Repairs that we do to prep the trucks for sale and then preventative maintenance on the fleet. So we've been doing preventative maintenance on the fleet as fast as we can. We're a little bit behind where we were last year due to the volume of transactions. So we'll see preventive maintenance costs rise again in the 4th quarter.
That's been offset by a decrease in repair and maintenance costs prepping trucks for sale. Those are the 2 largest categories. All the other smaller categories that kind of fall in that. We see some increases in property tax for the year, But revenues outpaced those costs and otherwise I don't recall any other expense category sticking out right now.
Thank you. Your ESOP expense, is that going to be in line with last year or up a bit this year?
It will probably be in line or within say $5,000,000
All right. Again, congratulations on an amazing quarter.
Thank you.
The next question comes from Craig Anyan with Artisan Partners. Please go ahead.
Hey, Jason. I was I thought that the biggest driver of repair is miles driven. So seeing that repair and maintenance number not up a lot is surprising. Can you talk about that?
Sure. I didn't answer the last question. Good enough. So the preventative maintenance, which is driven by which is I don't want to use the bad pun there. It's created by miles driven is the preventive maintenance.
That portion of our expense Repair and maintenance is up. It's just being offset by the decrease where we're down, I think for the quarter, maybe say 4000, 4,000 plus units sold. And so the unit costs for prepping those for sale, the pickups the cargo vans, the ones that we've had issues with in the past, we haven't had as much of those costs running through for the quarter. So we're still seeing an increase in what you're talking about. We do have a little bit higher backlog than normal right now, but that's simply because we don't usually have this volume of transactions In November December.
So we will have some additional catch up in the Q1 of this year, but it's not anything that's out of control.
Okay. I haven't really formulated this question well, but I'll try it. I mean, mobility in the U. S. Is probably on the rise now.
So what's going through management's head With regard to this new found Freedom of driving around or migration across the country. I mean, are you all going to think about making the business Bigger permanently or have we pulled forward demand and now we're at a right level of utilization on the fleet? Some thoughts around just kind of the evolution of migration, how that's affecting your business?
Yes, That's an interesting question and we certainly didn't foresee this coming. But what The business model that we've been working now for decades is trying to be everywhere where The public is going to be. And I think what this has created is the opportunity for us to expand into more markets with company stores. So oftentimes, there's been markets that haven't been big enough or vibrant enough that the economics worked for a company store, so we'd have a network of And I think this has spurred us on To keep working the plan where there's new markets that we can get into. I've mentioned over the years How many markets with at least 50,000 people we're in and there's a number of those markets that we're still not in yet.
I think this has kind of pushed us along to continue down that path, find those markets, find economical ways for us to get in there and meet the demand. Early on, I mentioned that the dealer network early on in this process or in this pandemic. Our dealer network was affected much more than us as more of their businesses were shut down. We stayed open. We redeemed critical essential workers, critical essential business, so we remained open throughout the entire thing.
Many of our independent dealers weren't able to do that. We tried to help many of them stay open by letting them use the U Haul business as a reason to be open. But over the second half of this year, they've come back in a very strong way and are keeping pace with the growth that we're having at company location. And we've grown our dealer network. The dealer network has been relatively flat the last several years and I think we're up a little over 1,000 dealers from December of last year.
So we'll make it a concerted effort to get closer to the customers. So I don't think this has changed Dramatically, our business model, I think in some ways it's reaffirmed it and I think in other ways it's encouraged us to go a little bit harder at it.
Yes. How do you get a pulse on, is this a one time move or is it a more permanent condition in terms of the demand for your product?
Joe may have a different opinion on this. I guess I don't have a real good feel for that. I think I've always said our business is based upon just any life event that would happen. So there's a whole bunch of people that have moved out of the big cities And that's moved our equipment certain places and I think there's going to be a natural ebb and flow to how people view big cities and perhaps they'll move back and then we'll be positioned well To help them do that as well. Or if they stay where they're at, they'll likely be moving around for the other normal life events, marriages, deaths, going to College, I mean, the whole process of going away to school has changed and we'll have to see how the dust settles on that.
But I think it will return to some semblance of normal and if not, we will just adjust to that.
Yes. And then the fleet, obviously, the migration has changed. Did you say I missed the first part of the call, how much of The revenue growth was volume versus transaction or
About 40% has been transaction growth this quarter.
Okay. And the 3 year cohort on, I don't know if you're doing that on Just annually or every quarter in terms of 80% occupancy or that stabilized number, is there any Has that improved?
Yes. So I ditched that whole 3 year deal after that went down in flames a So, but I have been doing I'll give you a few other ways to look at it and you can pick the one that you like the best. But one of the questions that we got from Jamie Weiland, he hasn't been able to make it on the phone yet, but I have some questions I'll answer for him was, I've given out a number of how many of our locations are over 80% occupancy. So at the end of December, 65% of our locations or about 831 locations were over 80% occupancy and that's an increase of 127 locations compared to And the occupancy for locations over 80% now averages about 92% occupancy or up Close to 2% from where those locations were last year. So that was One way of looking at it, I also had done the formula for all properties that were open or had an occupancy of 80% for at least 2 years.
That's kind of what some of our REIT competitors use as a stabilized occupancy number. That group was their average occupancy was 93% and was up about 3 points. So kind of no matter how you look at it, our average occupancy That stabilized properties is probably up about 2 to 3 points. And otherwise, we've seen a growth in a whole bunch of the other facilities are starting to fill up as we had hoped.
Okay. Yes, that's what I was getting at. I couldn't remember which one, which iteration of that we're on, but some look at it is helpful. And then the tax refund, it looks like in the you still have about $380,000,000 to go there?
Yes. So we have About I think it's $123,000,000 that we filed refund for and are waiting for it. And it's now past the point where now the U. S. Treasury is paying interest on those, but we haven't received them yet.
Then in December, we filed our fiscal year 2020 tax returns and Then the refunds that are being filed carrybacks for that are going to total I think another 258,000,000 So that's all still in process, but we during the quarter and up through today, we haven't actually received any of that cash yet. Okay. I would like to slide in now. Jamie Wilen couldn't be on the call today, but he sent some questions ahead of time. And I promise we're not asking people to submit questions ahead of time like Perhaps the White House is doing, but he did send some, so I wanted to hit those questions for everyone.
So Jamie's first question was, occupancy rates at self storage increased nicely for the 2nd straight quarter. Given the pause in construction because of COVID, would it be reasonable to expect occupancy rates to continue to rise versus year ago levels? That one, I can answer just yes is the answer. Have rates changed at our self storage facilities? Well, I would say that in looking at our average rates for customers that are moving into the locations, So locations that were in the portfolio last year versus this year, so I have a comparison.
Those rates are up about 1%. But once you blend in all of the new locations, our average rate per square foot looks relatively Flat across the whole portfolio. His next question is how many square feet of new facilities will we add this fiscal year? How many did we do last year and what would our expectation be for next fiscal year? They typically quote 12 month figures, So just understand that this is going to be a 9 month number.
So for the 1st 9 months of this year, we've done 2,000,000 866,000 new square feet. For all of fiscal 2020, we did 5,845,000 square feet. Right now, our active project list has us projected to build out another 6,600,000 square feet, but that's not all going to happen here in the next 12 months. So I would suspect that by the end of fiscal 2021, we're going to do maybe about 3,500,000 square feet. And for fiscal year 2022, that's probably going to look Closer to this year versus what we did in fiscal year 2020.
Next question, truck rental volume was up nicely while the truck fleet grew only marginally. This obviously drove fleet utilization higher. And as a result, we had a fantastic growth and profitability. Did we ever reach a point where we were close to capacity and trucks for rental were not available? With the pause in delivery of new vehicles, can we expect fleet utilization to continue to be well above the levels of prior years?
So I'll give you the answer that Joe has given in the past. There's always time periods like the end of the month where supply is strained due to demand. You add into that now the significant movement of the one way fleet to these high demand areas and it's just accentuating that. So I want to stress again the investments in the fleet that we've made previously really is how we've been able to handle this demand today. So that whole buildup, so to this, the short answer to the question is yes, we should expect fleet utilization to continue Going forward.
The next question, when you talk about corporate business, are you specifically referring to supplementing the fleets of Amazon, FedEx and UPS during the holidays. I assume they will not want to own too many trucks that are We used during the holiday crunch, so should we expect that there will always be a call for us to fill in with rentals during that time when they are operating above capacity? So when we say corporate accounts, those are the majority of what we're talking about, the last mile delivery business. We have a whole team of account managers that work with smaller accounts than just that. So this business comes in throughout the year.
We have a great working relationship with these organizations. I don't see any reason why that's not going to continue. As I mentioned in the prepared remarks, we saw this business increase during the quarter with more of our traditional last mile operators, not so much with Amazon. Depreciation charges changed dramatically with the pause in self storage construction and fleet additions. What would you expect depreciation to be in the next fiscal year?
Okay. I think we listed it out in the 10 Qs. Quarter fleet depreciation, I think, was down about 9,500,000 It's $17,500,000 for the 9 months, so you're not going to see that very often. A few quarters ago, I think I told everyone That we're going to start trending up towards the end of this fiscal year. Well, that's been pushed back.
So I think probably now we're looking at the middle of next year. And A lot of that really has to do with the timing of the production of our 26 foot trucks and we're now starting to produce those and those have a pretty big effect. All other non fleet depreciation, I think we listed was up about $5,000,000 for the quarter and maybe $18,000,000 $19,000,000 for the 9 months. Looking at how that expense, which is largely related to our self storage development, looking at how that's layered on, I would expect that to continue to increase, but at a lower rate now as we start to run into larger comparable quarters here starting in the Q4. Can you begin to quantify U Box revenues, their percentage increase from last year and its profit margins?
We're not at the point where we're required to report that and we feel that reporting that puts us at a competitive disadvantage. So we're not In a hurry to do that because no one else is reporting their results. What I will say is that these revenues are embedded in the moving and storage The revenue line, so if you look at that line and you look at the change in it, you should be able to at least get a sense of the direction of the program. And regarding the profit margins, we do a cut of kind of a managerial P and L for them that allocates expenses as best as we can. And that Kind of pro form a EBITDAR margin sits just below our overall moving and storage.
So it's It's not quite at the same level as the overall Movie and Storage segment, but it's still quite positive and it's within a couple of points. There is a 1 quarter lag in the change in marketable securities value hitting the income statement. This is for our insurance companies. What will the figure be for the March quarter? So, we have two things going on.
Both of our insurance companies are affected by The expected credit loss standard or what they call CECL. So For the 12 months, I think our life insurance segment is going to have a charge of around $900,000 So that's I think in the Q4 though, It will actually work out to be about a benefit of $800,000 to get them there. I think they were affected more negatively in the first half of the year. For our P&C Company, it's a smaller adjustment. I think it was actually ended up for the quarter end of being positive as they reduced their allowances As the securities market, in particular the corporate bond market has improved, that has the effect of improving our CECL allowance.
And then, I think we had one question come in from Steve Galbraith At Kindred, he asked about our cash build. So at the end of December, we were at Just cash, so excluding available debt, just cash we had $1,250,000,000 at the moving to storage segment. At March, that was $459,000,000 So a couple of things going on. First, we reduced CapEx. Our net CapEx, so CapEx less Asset sales was down $792,000,000 for the 9 months versus the previous year.
And then cash flow operating cash flows as presented in the GAAP cash We're up $405,000,000 We don't officially espouse EBITDA because it's a non GAAP measurement, but I believe if you were to look at our 9 month EBITDA, it's at a record level right now of about $1,272,000,000 That's a $300,000,000 increase. For the outlook on cash, we're going to remain cautious As we try to ramp back up the CapEx programs and then also see what happens with COVID and see what direction government regulation and tax policy takes. So, I think that's all the questions. So, if the operator doesn't mind, I can Go ahead and wrap up the call right now. We appreciate everyone's support.
Our next earnings release is going to be for our annual our 4th quarter results, our 10 ks, and we'll be back. We'll file those on May 26, then we'll have our next call on May 27. So thank you all for your participation and we'll talk to you then.
The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.