AMERCO /NV/ – 10-K/A – Management’s Discussion and Analysis of Financial Condition and Results of Operations
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We begin this MD&A with the overall strategy of
This MD&A should be read in conjunction with the other sections of this Annual Report, including Item 1: Business, Item 6: Selected Financial Data and Item 8: Financial Statements and Supplementary Data. The various sections of this MD&A contain a number of forward-looking statements, as discussed under the caption, Cautionary Statements Regarding Forward-Looking Statements, all of which are based on our current expectations and could be affected by the uncertainties and risk factors described throughout this Annual Report and particularly under the section Item 1A: Risk Factors. Our actual results may differ materially from these forward-looking statements.
Overall Strategy
Our overall strategy is to maintain our leadership position in the North American "do-it-yourself" moving and storage industry. We accomplish this by providing a seamless and integrated supply chain to the "do-it-yourself" moving and storage market. As part of executing this strategy, we leverage the brand recognition of
Our primary focus is to provide our customers with a wide selection of moving rental equipment, convenient self-storage rental facilities and related moving and self-storage products and services. We are able to expand our distribution and improve customer service by increasing the amount of moving equipment and storage rooms and portable storage boxes available for rent, expanding the number of independent dealers in our network and expanding and taking advantage of our eMove capabilities.
Our
Our Life Insurance operating segment is focused on long-term capital growth through direct writing and reinsuring of life,
Description of Operating Segments
• Moving and Storage, comprised of
•
• Life Insurance, comprised of Oxford and its subsidiaries. 18
See Note 1, Basis of Presentation, Note 22, Financial Information by Geographic Area and Note 22A, Consolidating Financial Information by Industry Segment of the Notes to Consolidated Financial Statements included in this Annual Report.
Moving and Storage Operating Segment
Our Moving and Storage operating segment consists of the rental of trucks, trailers, portable moving and storage boxes, specialty rental items and self-storage spaces primarily to the household mover as well as sales of moving supplies, towing accessories and propane. Operations are conducted under the registered trade name U-Haul® throughout
With respect to our truck, trailer, specialty rental items and self-storage rental business, we are focused on expanding our dealer network, which provides added convenience for our customers and expanding the selection and availability of rental equipment to satisfy the needs of our customers.
U-Haul brand self-moving related products and services, such as boxes, pads and tape allow our customers to, among other things; protect their belongings from potential damage during the moving process. We are committed to providing a complete line of products selected with the "do-it-yourself" moving and storage customer in mind.
eMove is an online marketplace that connects consumers to independent Moving Help® service providers and thousands of independent Self-Storage Affiliates. Our network of customer rated affiliates and service providers furnish pack and load help, cleaning help, self-storage and similar services, all over
Since 1945
Property and Casualty Insurance Operating Segment
Our
Life Insurance Operating Segment
Our Life Insurance operating segment provides life and health insurance products primarily to the senior market through the direct writing and reinsuring of life insurance,
Critical Accounting Policies and Estimates
Our financial statements have been prepared in accordance with the generally accepted accounting principles ("GAAP") in
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In the following pages we have set forth, with a detailed description, the accounting policies that we deem most critical to us and that require management's most difficult and subjective judgments. These estimates are based on historical experience, observance of trends in particular areas, information and valuations available from outside sources and on various other assumptions that are believed to be reasonable under the circumstances and which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual amounts may differ from these estimates under different assumptions and conditions; such differences may be material.
We also have other policies that we consider key accounting policies, such as revenue recognition; however, these policies do not meet the definition of critical accounting estimates, because they do not generally require us to make estimates or judgments that are difficult or subjective. The accounting policies that we deem most critical to us, and involve the most difficult, subjective or complex judgments include the following:
Principles of Consolidation
We apply ASC 810 - Consolidation ("ASC 810") in our principles of consolidation. ASC 810 addresses arrangements where a company does not hold a majority of the voting or similar interests of a variable interest entity ("VIE"). A company is required to consolidate a VIE if it has determined it is the primary beneficiary. ASC 810 also addresses the policy when a company owns a majority of the voting or similar rights and exercises effective control.
As promulgated by ASC 810, a VIE is not self-supportive due to having one or both of the following conditions: (i) it has an insufficient amount of equity for it to finance its activities without receiving additional subordinated financial support or (ii) its owners do not hold the typical risks and rights of equity owners. This determination is made upon the creation of a variable interest and is re-assessed on an on-going basis should certain changes in the operations of a VIE, or its relationship with the primary beneficiary trigger a reconsideration under the provisions of ASC 810. After a triggering event occurs the facts and circumstances are utilized in determining whether or not a company is a VIE, which other company(s) have a variable interest in the entity, and whether or not the company's interest is such that it is the primary beneficiary.
We will continue to monitor our relationships with the other entities regarding who is the primary beneficiary, which could change based on facts and circumstances of any reconsideration events.
During the first quarter of fiscal 2013 SAC Holding II fully repaid the
Recoverability of Property, Plant and Equipment
Property, plant and equipment are stated at cost. Interest expense incurred during the initial construction of buildings and rental equipment is considered part of cost. Depreciation is computed for financial reporting purposes using the straight-line or an accelerated method based on a declining balance formula over the following estimated useful lives: rental equipment 2-20 years and buildings and non-rental equipment 3-55 years. We follow the deferral method of accounting based on ASC 908 - Airlines for major overhauls in which engine and transmission overhauls are currently capitalized and amortized over three years. Routine maintenance costs are charged to operating expense as they are incurred. Gains and losses on dispositions of property, plant and equipment are netted against depreciation expense when realized. Equipment depreciation is recognized in amounts expected to result in the recovery of estimated residual values upon disposal, i.e., minimize gains or losses. In determining the depreciation rate, historical disposal experience, holding periods and trends in the market for vehicles are reviewed.
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We regularly perform reviews to determine whether facts and circumstances exist which indicate that the carrying amount of assets, including estimates of residual value, may not be recoverable or that the useful life of assets are shorter or longer than originally estimated. Reductions in residual values (i.e., the price at which we ultimately expect to dispose of revenue earning equipment) or useful lives will result in an increase in depreciation expense over the life of the equipment. Reviews are performed based on vehicle class, generally subcategories of trucks and trailers. We assess the recoverability of our assets by comparing the projected undiscounted net cash flows associated with the related asset or group of assets over their estimated remaining lives against their respective carrying amounts. We consider factors such as current and expected future market price trends on used vehicles and the expected life of vehicles included in the fleet. Impairment, if any, is based on the excess of the carrying amount over the fair value of those assets. If asset residual values are determined to be recoverable, but the useful lives are shorter or longer than originally estimated, the net book value of the assets is depreciated over the newly determined remaining useful lives.
Management determined that additions to the fleet resulting from purchases should be depreciated on an accelerated method based upon a declining formula. Under the declining balances method (2.4 times declining balance), the book value of a rental truck is reduced approximately 16%, 13%, 11%, 9%, 8%, 7%, and 6% during years one through seven, respectively and then reduced on a straight line basis to a salvage value of 20% by the end of year fifteen. Beginning in
Although we intend to sell our used vehicles for prices approximating book value, the extent to which we realize a gain or loss on the sale of used vehicles is dependent upon various factors including but not limited to, the general state of the used vehicle market, the age and condition of the vehicle at the time of its disposal and the depreciation rates with respect to the vehicle. We typically sell our used vehicles at our sales centers throughout
Insurance Reserves
Liabilities for life insurance and certain annuity and health policies are established to meet the estimated future obligations of policies in force, and are based on mortality, morbidity and withdrawal assumptions from recognized actuarial tables which contain margins for adverse deviation. In addition, liabilities for health, disability and other policies include estimates of payments to be made on insurance claims for reported losses and estimates of losses incurred, but not yet reported. Liabilities for annuity contracts consist of contract account balances that accrue to the benefit of the policyholders.
Insurance reserves for our
Due to the nature of the underlying risks and high degree of uncertainty associated with the determination of the liability for future policy benefits and claims, the amounts to be ultimately paid to settle these liabilities cannot be precisely determined and may vary significantly from the estimated liability, especially for long-tailed casualty lines of business such as excess workers' compensation. As a result of the long-tailed nature of the excess workers' compensation policies written by Repwest during 1983 through 2002, and similar policies assumed by Repwest during 2001 through 2003, it may take a number of years for claims to be fully reported and finally settled.
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On a regular basis insurance reserve adequacy is reviewed by management to determine if existing assumptions need to be updated. In determining the assumptions for calculating workers' compensation reserves, management considers multiple factors including the following:
• Claimant longevity • Cost trends associated with claimant treatments
• Changes in ceding entity and third party administrator reporting practices
• Changes in environmental factors including legal and regulatory • Current conditions affecting claim settlements • Future economic conditions including inflation
Significant variables that led to the third quarter of fiscal 2012 reserve strengthening were cost trends associated with claimant treatments, changes related to ceding entity and third party administrator reporting practices, projected longevity of claimants terms and assumptions for future claim settlements.
As part of this latest review, the Company has reserved each claim based upon the accumulation of current claim costs projected through the claimants' life expectancy, and then adjusted for applicable reinsurance arrangements. Management reviews each claim bi-annually to determine if the estimated life-time claim costs have increased and then adjusts the reserve estimate accordingly at that time. We have factored in an estimate of what the potential cost increases could be in our IBNR liability. We have not assumed settlement of the existing claims in calculating the reserve amount, unless it is in the final stages of completion.
Continued increases in claim costs, including medical inflation and new treatments and medications could lead to future adverse development resulting in additional reserve strengthening. Conversely, settlement of existing claims or if injured workers return to work or expire prematurely, could lead to future positive development.
Impairment of Investments
Investments are evaluated pursuant to guidance contained in ASC 320 - Investments - Debt and Equity Securities to determine if and when a decline in market value below amortized cost is other-than-temporary. Management makes certain assumptions or judgments in its assessment including but not limited to: ability and intent to hold the security, quoted market prices, dealer quotes or discounted cash flows, industry factors, financial factors, and issuer specific information such as credit strength. Other-than-temporary impairment in value is recognized in the current period operating results. We recognized other-than-temporary impairments of
Income Taxes
Our tax returns are periodically reviewed by various taxing authorities. The final outcome of these audits may cause changes that could materially impact our financial results.
Fair Values
Fair values of cash equivalents approximate carrying value due to the short period of time to maturity. Fair values of short term investments, investments available-for-sale, long term investments, mortgage loans and notes on real estate, and interest rate swap contracts are based on quoted market prices, dealer quotes or discounted cash flows. Fair values of trade receivables approximate their recorded value.
Our financial instruments that are exposed to concentrations of credit risk consist primarily of temporary cash investments, trade receivables, reinsurance recoverables and notes receivable. Limited credit risk exists on trade receivables due to the diversity of our customer base and their dispersion across broad geographic markets. We place our temporary cash investments with financial institutions and limits the amount of credit exposure to any one financial institution.
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We have mortgage receivables, which potentially expose us to credit risk. The portfolio of notes is principally collateralized by self-storage facilities and commercial properties. We have not experienced any material losses related to the notes from individual or groups of notes in any particular industry or geographic area. The estimated fair values were determined using the discounted cash flow method and using interest rates currently offered for similar loans to borrowers with similar credit ratings.
The carrying amount of long term debt and short term borrowings are estimated to approximate fair value as the actual interest rate is consistent with the rate estimated to be currently available for debt of similar term and remaining maturity.
Other investments including short term investments are substantially current or bear reasonable interest rates. As a result, the carrying values of these financial instruments approximate fair value.
Subsequent Events
Our management has evaluated subsequent events occurring after
Financial Strength Ratings
In
Recent Accounting Pronouncements
In
Adoption of New Accounting Pronouncements
In
In
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In
From time to time, new accounting pronouncements are issued by the FASB or the
Fiscal 2013 Compared with Fiscal 2012
Listed below, on a consolidated basis, are revenues for our major product lines for fiscal 2013 and fiscal 2012:
Year Ended March 31, 2013 2012 (In thousands) Self-moving equipment rentals$ 1,767,520 $ 1,678,256 Self-storage revenues 152,660 134,376
Self-moving and self-storage products and service sales 221,117 213,854 Property management fees
24,378 23,266 Life insurance premiums 178,115 277,562 Property and casualty insurance premiums 34,342 32,631 Net investment and interest income 82,903 73,552 Other revenue 97,552 78,530 Consolidated revenue$ 2,558,587 $ 2,512,027
Self-moving equipment rental revenues increased
Self-storage revenues increased
Sales of self-moving and self-storage products and services increased
Property management fees increased
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Life insurance premiums decreased
Property and casualty insurance premiums increased
Net investment and interest income increased
Other revenue increased
As a result of the items mentioned above, revenues for
Listed below are revenues and earnings (loss) from operations at each of our operating segments for fiscal 2013 and 2012. The insurance companies' years ended
Year EndedMarch 31, 2013 2012 (In thousands) Moving and storage Revenues$ 2,282,342 $ 2,156,923
Earnings from operations before equity in earnings of subsidiaries
462,328 432,766 Property and casualty insurance Revenues 48,200 42,586 Earnings (loss) from operations 14,194 (36,426) Life insurance Revenues 231,490 317,274 Earnings from operations 22,955 20,149 Eliminations Revenues (3,445) (4,756) Earnings from operations before equity in earnings of subsidiaries (294) (482) Consolidated Results Revenues 2,558,587 2,512,027 Earnings from operations 499,183 416,007
Total costs and expenses decreased
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Total costs and expenses at the Moving and Storage operating segment increased
As a result of the above mentioned changes in revenues and expenses, earnings from operations increased to
Interest expense for fiscal 2013 was
Income tax expense was
Dividends accrued or paid on our Series A Preferred were
As a result of the above mentioned items, earnings available to common shareholders were
Basic and diluted earnings per common share for fiscal 2013 were
The weighted average common shares outstanding basic and diluted were 19,518,779 for fiscal 2013, compared with 19,476,187 for fiscal 2012.
Fiscal 2012 Compared with Fiscal 2011
Listed below, on a consolidated basis, are revenues for our major product lines for fiscal 2012 and fiscal 2011:
Year Ended March 31, 2012 2011 (In thousands) Self-moving equipment rentals$ 1,678,256 $ 1,547,015 Self-storage revenues 134,376 120,698
Self-moving and self-storage products and service sales 213,854 205,570 Property management fees
23,266 22,132 Life insurance premiums 277,562 206,992 Property and casualty insurance premiums 32,631 30,704 Net investment and interest income 73,552 62,745 Other revenue 78,530 55,503 Consolidated revenue$ 2,512,027 $ 2,251,359
Self-moving equipment rental revenues increased
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Self-storage revenues increased
Sales of self-moving and self-storage products and services increased
Life insurance premiums increased
Property and casualty insurance premiums increased
Net investment and interest income increased
Other revenue increased
As a result of the items mentioned above, revenues for
Listed below are revenues and earnings (loss) from operations at each of our operating segments for fiscal 2012 and 2011. The insurance companies' years ended
Year EndedMarch 31, 2012 2011 (In thousands) Moving and storage Revenues$ 2,156,923 $ 1,977,826
Earnings from operations before equity in earnings of subsidiaries
432,766 355,173 Property and casualty insurance Revenues 42,586 38,663 Earnings from operations (36,426) 5,638 Life insurance Revenues 317,274 239,995 Earnings from operations 20,149 17,435 Eliminations Revenues (4,756) (5,125) Earnings from operations before equity in earnings of subsidiaries (482) (551) Consolidated Results Revenues 2,512,027 2,251,359 Earnings from operations 416,007 377,695
Total costs and expenses increased
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Operating expenses for the Moving and Storage operating segment increased
As a result of the above mentioned changes in revenues and expenses, earnings from operations increased to
Interest expense for fiscal 2012 was
Income tax expense was
Dividends paid or accrued on our Series A Preferred were
As a result of the above mentioned items, earnings available to common shareholders were
Basic and diluted earnings per common share for fiscal 2012 were
The weighted average common shares outstanding basic and diluted were 19,476,187 for fiscal 2012, compared with 19,432,781 for fiscal 2011.
Moving and Storage
Fiscal 2013 Compared with Fiscal 2012
Listed below are revenues for the major product lines at our Moving and Storage operating segment for fiscal 2013 and fiscal 2012:
Year Ended March 31, 2013 2012 (In thousands) Self-moving equipment rentals$ 1,769,058 $ 1,679,963 Self-storage revenues 152,660 134,376
Self-moving and self-storage products and service sales 221,117 213,854 Property management fees
24,378 23,266 Net investment and interest income 18,622 27,132 Other revenue 96,507 78,332 Moving and Storage revenue$ 2,282,342 $ 2,156,923
Self-moving equipment rental revenues increased
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Self-storage revenues increased
Sales of self-moving and self-storage products and services increased
Property management fees increased
Net investment and interest income decreased
Other revenue increased
The Company owns and manages self-storage facilities. Self-storage revenues reported in the consolidated financial statements represent Company-owned locations only. Self-storage data for our owned storage locations follows:
Year Ended March 31, 2013 2012 (In thousands, except occupancy rate) Room count as of March 31 186 165 Square footage as of March 31 16,034 13,889 Average monthly number of rooms occupied 139 123 Average monthly occupancy rate based on room count 78.7% 76.9% Average monthly square footage occupied 11,999 10,401
Total costs and expenses increased
During the third quarter of fiscal 2013 Hurricane Sandy struck the Northeastern portion of
As a result of the above mentioned changes in revenues and expenses, earnings from operations for the Moving and Storage operating segment before consolidation of the equity in the earnings of the insurance subsidiaries increased to
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Equity in the earnings of
As a result of the above mentioned changes in revenues and expenses, earnings from operations increased to
Fiscal 2012 Compared with Fiscal 2011
Listed below are revenues for the major product lines at our Moving and Storage operating segment for fiscal 2012 and fiscal 2011:
Year Ended March 31, 2012 2011 (In thousands) Self-moving equipment rentals$ 1,679,963 $ 1,549,058 Self-storage revenues 134,376 120,698
Self-moving and self-storage products and service sales 213,854 205,570 Property management fees
23,266 22,132 Net investment and interest income 27,132 25,702 Other revenue 78,332 54,666 Moving and Storage revenue$ 2,156,923 $ 1,977,826
Self-moving equipment rental revenues increased
Self-storage revenues increased
Sales of self-moving and self-storage products and services increased
Other revenue increased
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The Company owns and manages self-storage facilities. Self-storage revenues reported in the consolidated financial statements represent Company-owned locations only. Self-storage data for our owned storage locations follows:
Year Ended March 31, 2012 2011 (In thousands, except occupancy rate) Room count as of March 31 165 153 Square footage as of March 31 13,889 12,534 Average monthly number of rooms occupied 123 113 Average monthly occupancy rate based on room count 76.9% 75.8% Average monthly square footage occupied 10,401 9,437
Total costs and expenses increased
As a result of the above mentioned changes in revenues and expenses, earnings from operations for the Moving and Storage operating segment before consolidation of the equity in the earnings of the insurance subsidiaries, increased to
Equity in the earnings of
As a result of the above mentioned changes in revenues and expenses, earnings from operations increased to
2012 Compared with 2011
Net premiums were
Net investment income was
Net operating expenses were
Benefits and losses incurred were
As a result of the above mentioned changes in revenues and expenses, pretax earnings (loss) from operations were
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2011 Compared with 2010
Net premiums were
Net investment income was
Net operating expenses were
Benefits and losses incurred were
As a result of the above mentioned changes in revenues and expenses, pretax earnings (loss) from operations were
Life Insurance
2012 Compared with 2011
Net premiums were
Net investment income was
Net operating expenses were
Benefits and losses incurred were
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Amortization of deferred acquisition costs ("DAC"), sales inducement asset ("SIA") and the value of business acquired ("VOBA") was
As a result of the above mentioned changes in revenues and expenses, pretax earnings from operations were
Life Insurance
2011 Compared with 2010
Net premiums were
Net investment income was
Net operating expenses were
Benefits and losses incurred were
Amortization of DAC and VOBA was
As a result of the above mentioned changes in revenues and expenses, pretax earnings from operations were
Liquidity and Capital Resources
We believe our current capital structure is a positive factor that will enable us to pursue our operational plans and goals and provide us with sufficient liquidity for the foreseeable future. The majority of our obligations currently in place mature between fiscal years 2016 and 2019. However, since there are many factors which could affect our liquidity, including some which are beyond our control, there is no assurance that future cash flows and liquidity resources will be sufficient to meet our outstanding debt obligations and our other future capital needs.
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At
Moving & Property and Casualty Life Insurance Storage Insurance (a) (a) (In thousands) Cash and cash equivalents $ 427,560 $ 14,120 $ 22,064 Other financial assets 299,341 420,523 1,072,589 Debt obligations 1,661,845 - - (a) As of December 31, 2012
At
A summary of our consolidated cash flows for fiscal 2013, 2012 and 2011 is shown in the table below: Years Ended March 31, 2013 2012 2011 (In thousands)
Net cash provided by operating activities
(536) (294) 271 Net cash flow 106,564 (25,334) 138,396 Cash at the beginning of the period 357,180 382,514 244,118 Cash at the end of the period$ 463,744 $ 357,180 $ 382,514
Net cash provided by operating activities decreased
Net cash used in investing activities increased
Net cash provided by financing activities increased
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Liquidity and Capital Resources and Requirements of Our Operating Segments
Moving and Storage
To meet the needs of our customers,
Real Estate has traditionally financed the acquisition of self-storage properties to support
Net capital expenditures (purchases of property, plant and equipment less proceeds from the sale of property, plant and equipment and lease proceeds) were$435.3 million ,$420.9 million and$300.0 million for fiscal 2013, 2012 and 2011, respectively. The components of our net capital expenditures are provided in the following table: Years Ended March 31, 2013 2012 2011 (In thousands) Purchases of rental equipment$ 599,044 $ 503,863 $ 386,626 Equipment lease buyouts 60,041 52,340 25,024 Purchases of real estate, construction and renovations 169,535 101,644 64,036 Other capital expenditures 47,330 52,253 49,650 Gross capital expenditures 875,950 710,100 525,336 Less: Lease proceeds (219,966) (120,301) (44,918)
Less: Sales of property, plant and equipment (220,699) (168,912) (180,411) Net capital expenditures
435,285 420,887 300,007
The Moving and Storage operating segment continues to hold significant cash and has access to additional liquidity. Management may invest these funds in our existing operations, expand our product lines or pursue external opportunities in the self-moving and storage market place, or reduce existing indebtedness where possible.
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State insurance regulations restrict the amount of dividends that can be paid to stockholders of insurance companies. As a result, our
The Company believes that stockholders equity at the Property and Casualty operating segment remains sufficient and we do not believe that its ability to pay ordinary dividends to
Stockholder's equity was
Life Insurance
Life Insurance's stockholder's equity was
Cash Provided (Used) from Operating Activities by Operating Segments
Moving and Storage
Net cash provided by operating activities was
Net cash provided by operating activities was
Our
Life Insurance
Net cash provided (used) by operating activities was
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In addition to cash flows from operating activities and financing activities, a substantial amount of liquid funds are available through our Life Insurance's operating segment short-term portfolio. At
Liquidity and Capital Resources - Summary
We believe we have the financial resources needed to meet our business plans including our working capital needs. The Company continues to hold significant cash and has access to existing credit facilities and additional liquidity to meet our anticipated capital expenditure requirements for investment in our rental fleet, rental equipment and storage acquisitions and build outs.
Our borrowing strategy is primarily focused on asset-backed financing and rental equipment operating leases. As part of this strategy, we seek to ladder maturities and hedge floating rate loans through the use of interest rate swaps. While each of these loans typically contains provisions governing the amount that can be borrowed in relation to specific assets, the overall structure is flexible with no limits on overall Company borrowings. Management feels it has adequate liquidity between cash and cash equivalents and unused borrowing capacity in existing credit facilities to meet the current and expected needs of the Company over the next several years. At
Fair Value of Financial Instruments
Assets and liabilities are recorded at fair value on the consolidated balance sheets and are measured and classified based upon a three tiered approach to valuation. ASC 820 requires that financial assets and liabilities recorded at fair value be classified and disclosed in a Level 1, Level 2 or Level 3 category. For more information, please see Note 16, Fair Value Measurements of the Notes to Consolidated Financial Statements.
The available-for-sale securities held by the Company are recorded at fair value. These values are determined primarily from actively traded markets where prices are based either on direct market quotes or observed transactions. Liquidity is a factor considered during the determination of the fair value of these securities. Market price quotes may not be readily available for certain securities or the market for them has slowed or ceased. In situations where the market is determined to be illiquid, fair value is determined based upon limited available information and other factors including expected cash flows. At
The interest rate swaps held by the Company as hedges against interest rate risk for our variable rate debt are recorded at fair value. These values are determined using pricing valuation models which include broker quotes for which significant inputs are observable. They include adjustments for counterparty credit quality and other deal-specific factors, where appropriate and are classified as Level 2.
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Disclosures about Contractual Obligations and Commercial Commitments
The following table provides contractual commitments and contingencies as ofMarch 31, 2013 : Payment due by Period (as of March 31, 2013) Contractual 04/01/13 - 04/01/14 - 04/01/16 - Obligations Total 03/31/14 03/31/16 03/31/18 Thereafter (In thousands) Notes, loans and leases payable - Principal$ 1,661,845 $ 226,944 $ 633,114 $ 455,470 $ 346,317 Notes, loans and leases payable - Interest 315,023 79,607 115,518 50,815 69,083 Revolving credit agreements - Principal - - - - - Revolving credit agreements - Interest - - - - - Operating leases 354,499 120,260 169,429 33,698 31,112 Property and casualty obligations (a) 153,654 15,871 24,170 19,801 93,812 Life, health and annuity obligations (b) 2,715,218 194,365 338,292 329,585 1,852,976 Self insurance accruals (c) 380,824 101,180 161,886 68,256 49,502 Post retirement benefit liability 10,476 493 1,262 1,747 6,974 Total contractual obligations$ 5,591,539 $ 738,720 $ 1,443,671 $ 959,372 $ 2,449,776
(a) These estimated obligations for unpaid losses and loss adjustment expenses include case reserves for reported claims and IBNR claims estimates and are net of expected reinsurance recoveries. The ultimate amount to settle both the case reserves and IBNR is an estimate based upon historical experience and current trends and such estimates could materially differ from actual results. The assumptions do not include future premiums. Due to the significant assumptions employed in this model, the amounts shown could materially differ from actual results.
(b) These estimated obligations are based on mortality, morbidity, withdrawal and lapse assumptions drawn from our historical experience and adjusted for any known trends. These obligations include expected interest crediting but no amounts for future annuity deposits or premiums for life and
(c) These estimated obligations are primarily the Company's self insurance accruals for portions of the liability coverage for our rental equipment. The estimates for future settlement are based upon historical experience and current trends. Due to the significant assumptions employed in this model, the amounts shown could materially differ from actual results.
As presented above, contractual obligations on debt and guarantees represent principal payments while contractual obligations for operating leases represent the notional payments under the lease arrangements.
ASC 740 - Income Taxes liabilities and interest of
Off Balance Sheet Arrangements
The Company uses off-balance sheet arrangements in situations where management believes that the economics and sound business principles warrant their use.
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Historically,
We currently manage the self-storage properties owned or leased by
We lease space for marketing company offices, vehicle repair shops and hitch installation centers from subsidiaries of
At
During fiscal 2013, subsidiaries of the Company held various junior unsecured notes of
These agreements along with notes with subsidiaries of
Fiscal 2014 Outlook
We will continue to focus our attention on increasing transaction volume and improving pricing, product and utilization for self-moving equipment rentals. Maintaining an adequate level of new investment in our truck fleet is an important component of our plan to meet our operational goals. Revenue in the U-Move program could be adversely impacted should we fail to execute in any of these areas. Even if we execute our plans, we could see declines in revenues primarily due to the economic conditions or competitive pressures that are beyond our control.
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We have added new storage locations and expanded at existing locations. In fiscal 2014, we are looking to continue to acquire new locations, complete current projects and increase occupancy in our existing portfolio of locations. New projects and acquisitions will be considered and pursued if they fit our long-term plans and meet our financial objectives. In the current environment we have focused fewer resources on new construction than in recent history. We will continue to invest capital and resources in the U-Box storage container program throughout fiscal 2014.
Quarterly Results (unaudited)
The quarterly results shown below are derived from unaudited financial statements for the eight quarters beginning
Quarter Ended December 31, September March 31, 2013 2012 30, 2012 June 30, 2012 (In thousands, except for share and per share data) Total revenues$ 564,307 $ 582,487 $ 744,117 $ 667,676 Earnings from operations 72,036 81,946 194,322 150,879 Net earnings 37,873 36,846 109,420 80,569 Earnings available to common shareholders 37,873 36,846 109,420 80,569 Basic and diluted earnings per common share $ 1.93 $ 1.89 $ 5.61 $ 4.13 Weighted average common shares outstanding: basic and diluted 19,536,630 19,523,794 19,512,550 19,502,369 Quarter Ended December 31, September March 31, 2012 2011 30, 2011 June 30, 2011 (In thousands, except for share and per share data) Total revenues$ 525,657 $ 635,429 $ 705,508 $ 645,433 Earnings from operations 58,338 24,873 184,433 148,363 Net earnings 25,405 728 101,011 78,223 Earnings available to common shareholders 25,405 728 101,175 69,238 Basic and diluted earnings per common share $ 1.29 $ 0.04 $ 5.20 $ 3.56 Weighted average common shares outstanding: basic and diluted 19,492,159 19,481,614 19,470,948 19,460,126 40
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- ATTORNEY GENERAL MAYES SUES MULTIPLAN AND MAJOR HEALTH INSURERS FOR ALLEGED PRICE-FIXING CONSPIRACY
- Arizona sues major health insurance companies for 'price fixing'
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- Study Data from National Institutes of Health Provide New Insights into Law and the Biosciences (Taking actuarial fairness seriously: what is required for the ethical use of genetics in insurance?): Legal Issues – Law and the Biosciences
- 26North Re Agrees to Acquire 100% of Independent Insurance Group
- Lincoln Financial Announces Executive Leadership Transitions
- Setting the record straight on premium-financed IUL
- AM Best Affirms Credit Ratings of Halyk-Life, JSC
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