Q1 2027 U-Haul Holding Co Earnings Call Transcript
Key Points
- U-Haul Holding Co (UHAL) is halfway to its goal of adding 3,000 independent dealer locations, with over 1,100 net new dealers added year-over-year, enhancing customer convenience and equipment utilization.
- Equipment rental revenues increased by $29 million, with transactions and revenue growth across both in-town and one-way markets.
- Storage revenues grew by 7% year-over-year, with average revenue per occupied foot improving by over 6% and new customer rental rates up 2.5%.
- The company reported a gain of $1.9 million from the disposal of retired rental equipment, a $24 million improvement year-over-year, reflecting more accurate depreciation.
- U-Haul Holding Co (UHAL) is actively repurchasing shares, with $242 million remaining under its buyback program, signaling confidence in the stock's value.
- The company is seeing positive trends in U-Box storage, with the number of boxes in storage increasing, which is expected to improve margins.
- First-quarter earnings declined to $123 million from $142 million year-over-year, with adjusted EBITDA in the Moving and Storage segment down $9 million.
- Operating expenses increased by $55 million, driven by higher personnel, fleet maintenance, self-insurance costs, and a $22.5 million spike in freight and shipping costs.
- Same-store occupancy in storage fell 456 basis points to 88.3%, largely due to a harder line on delinquent accounts, though net tenant movement is improving.
- Freight costs are expected to remain a headwind for the rest of the year, peaking in July, and may require customer pricing adjustments that could impact demand.
- Capital expenditures for new rental equipment rose to $602 million, while proceeds from sales of retired equipment fell by $14 million, pressuring cash flow.
- The resale market for cargo vans is receding, which could lead to holding units longer and potentially affect future fleet investment decisions.
Hello, everyone.
Thank you for joining us and welcome to U-Haul Holding Company's first quarter fiscal 2027 investor call. After today's prepared remarks, we will host a question-and-answer session. If you would like to ask a question, please press star 1 to raise your hand. To withdraw your question, press star 1 again. I will now hand the conference over to Sebastian Reyes. Sebastian, please go ahead.
Good morning. Welcome to the U-Haul Holding Company First Quarter Fiscal 2027 Investor Call. Before we begin, I'd like to remind everyone that certain of the statements during this call, including without limitations, 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 1,933 as amended and Section 21E of the Securities Exchange Act of 1,934 as amended.
Forward-looking statements are inherently subject to risks and
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