U-Haul Holding Company Q4 FY2024 earnings call

• Equipment and Gains: Huge price increases from Ford and GM led to less gain on sale. Resale pricing not keeping up with new vehicle prices. Repair costs down but could decrease further. Consumer confidence shows some upturn chance in miles traveled per rental but consumers cautious. Personnel costs up due to wage mandates and inflation; combated by increased productivity via better IT and product improvements.
• Self-Storage Expansion: Continuing to expand self-storage footprint, still filling rooms but slower than additions. Broadest footprint in self-storage, but markets to expand into.
• Financials: Fourth quarter 2024 loss $863,000 vs $37.4 million profit last year. Full fiscal 2024 earnings $628.7 million vs $924.5 million in 2023. Key factors: decline in gains on disposal of retired equipment and increases in depreciation costs. Operating cash flow/EBITDA slightly improved. Fleet repair and maintenance improved for second consecutive quarter but still up year-over-year. Personnel costs up $9 million quarterly and $50 million annually. Liability costs increased $14 million in Q4 due to accident claims. Property costs up

Equipment Rental

• Fourth quarter 2024: $10 million decrease (1%) in revenue compared to same quarter last year. March 2024 was first year-over-year improvement in 19 months.
• Fiscal 2024: Capital expenditures for new rental equipment were $1,619 million, a $320 million increase from prior year. Proceeds from sale of retired rental equipment increased by $40 million to $728 million. Average sales price per unit declined.

Self-Storage

• Fourth quarter 2024: Revenues up $17.5 million (9%). Full year 2024: Revenues up over $86.5 million (12%). Quarterly increase due to 6% more units rented and 2.5% higher revenue per occupied square foot.
• Occupancy ratio: Decreased 140 basis points to under 80% due to new units added. Fiscal 2024: Investment in real estate acquisitions was $1,258 million, down $83 million from prior year. Added 2,424,000 net rentable square feet in the quarter, 12-month total 5,475,000

• Equipment Rental: Gains on disposal of equipment expected to continue receding over next 12 months. Projection for fiscal 2025: $100 million increase in capital expenditures for new rental equipment. Fleet size expected to be about the same or a few thousand less by end of next year as older trucks are removed.
• Self-Storage: Expect growth in total rooms rented, but possibly slight decline in occupied square foot as percent of all square foot. Aim to hold prices steady or get small increase

• Vehicle Pricing and Resale: Large price increases by automakers leading to less gain on sale. Resale pricing not keeping up with new vehicle prices. Uncertainty in how this will play out into the fall.
• Personnel Costs: Government wage mandates and inflation leading to higher personnel costs, requiring increased productivity via IT and product improvements, which is speculative.
• Electrification Impact: Automakers' push for electrification affecting vehicle costs, availability, and resale prices. Ryder study suggests electrification could increase costs significantly, impacting the company

Q: On fleet CapEx and utilization A: Utilization increases by decimal points, refreshing fleet helps with maintenance and uptime. Fleet size may be about the same or less next year as older trucks are shed Q: On one-way moves A: Historically, ~45% of revenue is one-way moves. Consumer conservatism affects miles per rental and one-way move trends Q: On self-storage competitive pricing A: Different rate strategy than competitors; avoids demand pricing model. Competitors' pricing confuses customers. Focus on steady pricing Q: On fiscal 2025 capital spending A: Fleet maintenance CapEx priority, real estate spend similar, net fleet CapEx to increase Q: On U-Box business A: U-Box has higher one-way moves, exploring shorter distance moves. No firm market share data vs competitors Q: On self-storage depreciation A: Fleet depreciation $565 million in 2024, buildings $253 million; compared to 2023: fleet $520 million, buildings $213 million Q: On fleet maintenance and personnel costs A: Expect to recoup some fleet maintenance costs as older trucks are removed, but personnel costs likely elevated due to wage mandates and inflation Q: On self-storage expansion and geographic opportunities A: Continuing to expand self-storage, but specific geographic areas not highlighted to avoid competition