Q1 2026 U-Haul Holding Co Earnings Call

All lines are in listen only mode. Following the presentation, we will conduct a question and answer session. If at any time. During this call are required immediate assistance. Please press star zero for the operator. This call is being recorded on Thursday August seven of 2025.

I would now like to turn the conference over to Sebastian Vegas. Please go ahead Sir.

Good morning, everyone. Thanks for joining us and welcome to the you are holding company first quarter 2026 investor call before.

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 27, a of the Security Act Securities Act of 1933 as amended and section 20 <unk>.

One E 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 the company's business and future operating results. Please refer to the Companys public SEC filings and Form 10-Q for the quarter ended June 32025, which is on file with the U S Securities and Exchange Commission.

I'll now turn the call over to Jason Berg, Chief Financial Officer of U haul holding company.

Thanks Sebastian.

Speaking to you today from our offices here in Phoenix, Arizona, Joe showing our chairman and CEO is unable to attend today's call. However, he is going to be available to speak to you at length and answer questions in two weeks at our annual Investor and analyst webcast.

We do have Sam showing the vice chairman of our board of directors here with us today to answer questions.

Yesterday, we reported first quarter earnings of $142 million compared to $195 million for the same quarter last year.

In terms of EPS at <unk> 73 per nonvoting share this quarter versus a dollar per nonvoting share last year at this time.

Earnings before interest taxes, and depreciation that I'll refer to this as adjusted EBITDA and our moving and storage segment increased 6% or nearly $31 million for the quarter driven by strong revenue growth across our product lines.

All of our product lines.

Included in our release and our financial supplement as a reconciliation of adjusted EBITDA to GAAP earnings.

The largest difference between adjusted EBITDA and GAAP earnings as depreciation and this is also the cause of the largest negative variance in earnings year over year.

During the first quarter of this year, we swung to a $22 million loss on the disposal retired rental equipment as compared to.

For questions.

$8 million gain last year.

Cargo vans that we purchased over the last two years that are now being sold.

Yesterday, we reported first quarter earnings of 142 million compared to 195 million for the same quarter last year.

Came into the fleet with higher initial cost and the current market resale values are not reflecting this.

Hence, resulting in a loss.

Uh, in terms of eps that's 73 cents per non-voting, share this quarter versus a dollar per non- voting share last year, at this time,

We have increased the pace of depreciation of the remaining units to reflect this new reality.

Yeah.

Additionally, we have depreciation from increasing the size of the box truck fleet by approximately 8600 units compared to June of last year.

Earnings before interest taxes and depreciation, that I'll refer to this as adjusted IBA and are moving in storage segment, increased 6% or nearly 31 million for the quarter.

Driven by strong Revenue growth across our product lines.

All of our product lines.

Okay.

Pricing on new cargo vans for the upcoming model year indicates some nominal improvement.

Uh, included in our release and our financial supplement, uh, is a Reconciliation of adjusted ebit dot to gaap earnings.

Of the 27% decline in earnings per share in the first quarter 'twenty, one census from fleet depreciation and 12.

Just from the increase in losses on rental equipment sales.

The largest difference between adjusted, EBA Don Gap. Earnings is a depreciation and this is also the cause of the largest negative variance in earnings year-over-year.

Sales.

For the first quarter, our equipment rental revenue results had a $44 million increase just over 4%.

During the first quarter of this year, we swung to a 22 million dollar loss on the disposal of retired rental equipment as compared to an 8 million dollar gain last year.

Revenue per transaction increased for both our in town and one way markets compared to the first quarter of last year.

Cargo vans that we purchased over the last 2 years that are now being sold.

Overall transactions largely held steady with what we saw in the first quarter of last year.

came into the fleet with higher initial costs and the current market resale values are not reflecting this

For the month of July we've seen revenue continued to trend positively compared to the same period last year, but we haven't yet seen a big improvement in transactions.

as resulting in a loss.

We have increased the dep, the pace of depreciation, of the remaining units to reflect this new reality.

Capital expenditures for new rental equipment in the first quarter were 585 million Thats, a $46 million increase compared to the same time last year.

Additionally, we have depreciation from increasing the size of the box truck Fleet by approximately 8,600 units compared to June of last year.

This increase was spread across acquisitions of box trucks trailers and towing devices in carnival fans.

Pricing on new cargo vans for the upcoming model year. Indicates some nominal Improvement.

Self storage continues to be positive storage revenues were up $19 million, which is about a 9% increase for the quarter.

Of the 27 Cent decline in earnings per share in the first quarter. 21 cents is from Fleet depreciation in 12 cents.

Average revenue per foot continued to improve across the entire portfolio or just over 1%. While our same store portfolio was up but it was up just under 1% per occupied foot.

This is from the increase in losses on rental equipment.

Sales for the first quarter, our equipment rental Revenue results had a 44 million dollar increase, just over 4%.

Our same store occupancy decreased by 100 basis points to just under 93%.

Revenue per transaction increased for both our in town and 1-way markets compared to the first quarter of last year.

In July we took on an effort system wide to increase the number of available rooms at our existing locations.

Overall transactions largely held steady with what we saw in the first quarter of last year.

By focusing on delinquent units.

While this effort will not affect revenue directly as we don't record any revenue until it's collected that will serve to reduce our reported occupancy level. A few points. If we don't refill all of those rooms in time for September reporting.

For the month of July. We've seen Revenue. Continue to Trend positively compared to the same period last year, but we haven't yet seen a big Improvement in transactions.

And our financial supplement you will see that we have a slide that shows where future storage revenue growth is coming from.

Capital expenditures for new rental equipment. In the first quarter were 585 million, that's a 46 million increase compared to the same time last year.

This increase was spread across Acquisitions the box, trucks trailers, Towing devices, and cargo fans.

And the future revenue growth from our existing portfolio has increased this is partially from us making these rooms now available to paying customers.

Self-storage continues to be positive; storage revenues were up $19 million, which is about a 9% increase for the quarter.

During the first quarter of this year, we invested $294 million.

Real estate acquisitions, along with self storage in U box warehouse development.

It's down $108 million from the first quarter of last year.

Average revenue per foot, continued to improve across the entire portfolio of both just over 1%. While our same store portfolio was up, but it was up just under 1% per occupied foot.

During the three months, we added 15 locations with storage.

Our same store occupancy, decreased by 100 basis points to just under 93%.

It's about $1 2 million, new net rentable square feet.

In July, we took on an effort, systemwide to increase the number of available rooms at our existing locations.

We currently have approximately $6 5 million new square feet being developed across 124 projects.

By focusing on delinquent units.

Our U box revenue results are included in other revenue in our 10-Q filing in this line item increased $21 million.

While this effort will not affect Revenue directly as we don't record any Revenue until it's collected, it will serve to reduce our reported occupancy, level a few points. If we don't refill all of those rooms in time for September reporting.

Of which U box is a large part.

U box revenue by itself was up about 16%.

We continue to have success, increasing U box moving transactions as well as increase in the number of these containers that customers are keeping in storage.

You know our financial supplement, you will see that we have a slide that shows where future storage Revenue. Growth is coming from

Moving and storage operating expenses increased $44 million for the quarter as a percent of revenue we were even with the first quarter of last year.

And the future Revenue growth from our existing portfolio has increased. This is partially from us making these rooms now available to paying customers.

The largest components of the increase were personnel, which was up $20 million.

During the first quarter of this year, we invested 294 million in real estate Acquisitions, along with self storage and ubbox Warehouse development.

Liability costs were up 17, and we did see an increase in fleet repair and maintenance due to the increased size of the fleet that was up about $5 million.

That's down. 108 million from the first quarter of last year.

As of June at the end of June this year cash along with availability from our existing corporate revolver at the moving and storage segment totaled $1 billion $191 million.

During during the 3 months, we added 15 locations with storage and that's about 1.2 million new net, rentable square feet.

Uh we currently have approximately 6 and a half million new square feet being developed across 124 projects.

We are holding our 19th annual virtual analyst and Investor meeting on Thursday August 21 at 11, a M at two o'clock eastern time this.

our ubbox Revenue results are included in other Revenue, in our 10q filing and this line item increased 21 million

Of which your box is a large part.

This is an opportunity to interact directly with company representatives through a live video webcast, which you can find it at investors <unk> Dot com.

You box Revenue by itself was up about 16%?

Once again, we'll have a brief presentation by the company.

We continue to have success increasing U Box, moving transactions, as well as increasing the number of these containers that customers are keeping in storage.

Followed by a question and answer session.

Please feel free to submit questions to us early.

Through the Investor website are sending nodes Sebastian or you can just submit them live during the webcast will be won't be good either way.

44 million for the quarter as a percent of Revenue. We were even with the first quarter of last year.

The largest components of the increase were personnel, which was up 20 million.

With that I'd like to hand, the call back to our operator, Chloe to begin the question and answer portion of the call.

Thank you we will now.

Liability costs were up 17 and we did see an increase in Fleet repair maintenance due to the increased size of the fleet that was up about 5 million.

Ill begin the question and answer those questions to ask a question you May Press Star then one on your Touchtone phone if youre using a speakerphone. Please pick up your handset before pressing the keys to withdraw your question. Please press the pound key.

As of June, the end of June this year, cash along with availability from our existing corporate revolver. At the moving and storage segment told 1,191 million

For just a moment to compile the Q&A roster.

Okay.

Our first question comes from the line of Stephen Boston from Zacks. Your line is open.

We are holding our 19th annual virtual analyst and investor media on Thursday, August 21st at 11:00 a.m. that's 2:00 Eastern Time.

Thank you and good morning.

This is an opportunity to interact directly with company representatives through a live video webcast, which you can find at investors.com.

Good morning.

Okay.

I had some questions specifically for Joe, but I also have one specifically for Sam.

Once again, we'll have a brief presentation by the company.

Followed by a question and answer session.

My question is for Joe until the Investor Conference.

The top line is improving like Joe expected and I had one specific question about U box, which I know Sam hedge.

Uh, please feel free to submit questions to us early, uh, through the investor website, or sending those Sebastian or you can just submit them live during the webcast. We'll be we'll be good either way.

With that, I'd like to hand the call back to our operator. Khloe to begin the question and answer portion of the call.

Thank you. We will now be

U box once again has achieved double digit growth in this quarter.

And it's through that tried and true formula of U haul.

Adding capacity and then specifically in the case of U box, increasing warehouse space, along with the number of containers and the number of <unk>.

Position to ask the question, you may press star then 1 on your touchtone phone. If you're using a speaker-phone, please speak up your handset before pressing the keys. So we draw your question, please. Press the pound key. We'll pause for just a moment to compile the Q&A roster.

Delivery equipment.

Yeah.

This is a growing area.

Assume.

Ultimately will be broken out as a segment as it reaches 10% of revenues.

Our first question comes from the line of Steven roster from Zach. Your line is open.

Thank you and good morning.

How much potential do you still think there is left in the U box.

Morning. Um,

It's.

Been growing.

Uh, I had some questions specifically for Joe, uh, but I also have one specifically for Sam.

Do you think you'd like 10% done at 25% done.

I'll delay my questions for Joe until the investor conference.

Or is it just too early to tell.

Um,

Well thanks for the question Steve This is Sam talking.

I think you start off some wise observations.

The top line is improving like Joe expected. And I had 1 specific question about ubox which I know Sam heads.

Of course, it's way too early to tell him on the more optimistic side.

Um,

I don't see why there is any reason that you box couldnt be as big as U haul is today.

you box. Once again, has achieved double digit growth in this quarter.

<unk>.

I think we're just at the infancy I think.

You're you really can't start answering that question until you start to get some real clarity on.

And it's through that tried and true formula of U-Haul that by adding capacity and in specifically in the case of ubox increasing warehouse space along with the number of containers and the number of of delivery equipment.

From the consumer.

If they understand with this product and service really is of course, we're so blessed with traditional U haul that.

this is a growing area, and

I assume ultimately will be broken out as a segment as it reaches 10% of revenues.

If you're six or <unk> 96.

You know exactly what you holidays and what it does and when you see it parked on the side of the road you know exactly what it is therefore, the customers and quite there the consumers and quite there with with the U box portable moving and storage model. When they do I think you'll really be able to answer. The question you have but but I think.

How much potential do you still think there's less than Ubee box? Um, it's

been growing.

Do you think you're, like, 10% done, or 25% done? Or is it just too early to tell?

It's the market is quite large and as time goes on.

You'll see it.

Continue to grow as a pillar of fuel oil company.

Let me just ask it slightly different.

Well, thanks for the question. Steve. This is Sam talking. Um, I think you you start off some wise observations of of course it's way too early to tell. I'm on the more optimistic side. Uh I don't see why there's any reason that ubox couldn't be as big as as U-Haul is today.

Wei.

Yeah.

Of the number of locations that you have.

Across the United States.

How many.

<unk> functionality for U box.

What are the same questions sure. So it depends what you're defining as a U haul any of course most of the time and you can within the company, we look at our outlets, including our dealers. So if you want to make the calculation from that Youre looking at.

And um I think we're just at the infancy. I think you're at you're you really can't start answering that question until you start to get some real Clarity on uh, from the consumer of if they understand what this product and service. Really is, of course, we're so blessed with traditional U-Haul that if you're

6 or 96.

You, you know exactly what you Haul is and what it does. And when you see it,

Somewhere between.

<unk>, 5% and 10%.

If youre looking based on company stores, Youre looking a little closer around half or so.

Yeah.

Needless to say it.

parked on the side of the road, you know exactly what it's there for, you know, the customer isn't quite there, the consumer isn't quite there with with the ubox portable Moving and Storage model. When they do I think you'll really be able to to to answer the question you have. But but I I think it's it's the Market's quite large.

That's that's not necessarily.

Assuming that you've got adequate build out of the U box product piggyback at those locations. So for example.

And as time goes on, um, you'll you'll see it. Uh, continue to grow as a pillar of of you all company.

You take.

Rather large market like Phoenix, you still barely scratching the surface of the capability that we need to service the customer.

Let me just ask it in a slightly different way. Um, what of the number of locations that you have?

Uh, across the United States.

How many have functionality for you box?

We're going to we're just going to have to keep building it out in.

<unk>.

If what you are trying to do is make a projection to say should this double triple quadruple tenex youre your youre going the right direction.

Alright. Thank you for taking my question and the other questions had to do with Joes experience because he has been running.

Running the company quite a long time and wanted to get into some of the depreciation cycles in first and inflationary cycles were personnel costs are I'll say bodes for the analyst comp.

In the company, we look at our Outlets including our dealers. So if you want to make the calculation from that you're looking at, you know, somewhere between, you know, 5 and 10 percent. Um, if you're looking based on company stores, you're looking a little closer around half.

So, um,

Okay Steve.

You know, needless to say, uh, that's not necessarily.

Yeah.

We will be happy to answer those then.

Alright, Thank you for taking my question.

Youre welcome.

Our next question comes from the line of Steven Ramsey from Thompson Research Group. Your line is open.

Hi, Good morning, I wanted to start with.

Good morning, I wanted to start with U box.

And I would just assume that transactions in U box is more associated with one way booth.

Are you able to see if you box one way moves are growing faster than.

Assuming that you've got adequate buildout of the ubox product, piggybacked at those locations. So, for example, um, there you take a, a, a rather large market, like Phoenix, you're still barely scratching the surface of of the capability that we need to service the customer. And um, you know, we're going to we're just going to have to keep building it out. And and if, if if if what you're trying to do is make a projection to say, should this double triple quadruple 10x your your, uh,

Your your going the right direction.

The rental segment, one way moves or said another way with one way transactions being up is that a rising tide for U box.

This is Jason I'll start and just set the scene with the.

The truck one way transactions trucking those have been.

All right. Thank you for taking my question, and the other questions had to do with Joe's experience because he's been, uh, running the company for quite a long time and wanted to get into some depreciation cycles and first and inflationary Cycles or personal costs are, I'll save those for the analyst conference.

Okay. Steve, uh, uh

From flat to up just slightly up 10 or 20000 transactions in the quarter. So.

We'll be happy to answer those then.

All right. Thank you for taking my question.

Yeah.

You're welcome.

Sandra juxtapose his experience with U box, one way transactions.

Yes U box one way transactions are are leading the way they are exceeding our truck rental transactions as a percentage.

Our next question comes from the line of Stephen Ramsey from Amazon research group, your line is open.

Hi, good morning. I wanted to start with

As far as a rising tide I think they are decoupled and.

In many ways I certainly don't look at the performance of the one way shipping of U box product.

And and and and juxtapose that against the truck rental numbers and say well, while we only have so much we can go we're capped or.

One number is dragging down the other I don't necessarily see it that way and I think what you should expect is for U box performance.

good morning. Yeah, I wanted to start with you box. Um, and I would just assume that transactions in hubbox is more associated with 1 way moves. Are you able to see if you box 1 way? Moves are growing faster than the the, the rental segments? 1 way moves or set another way with 1-way transactions being up? Is that a rising tide for ubox?

Performance as a percentage to exceed the truck rental gains that we're able to make there is there is little doubt of that.

Well, this is Jason. I'll start and just set the the scene with the the truck 1-way transactions truck and tread those have been

Okay. That's helpful and then.

Wanted to think about the margin profile of the business 35.

Uh from Flat to up just slightly, you know up up 10 or 20 thousand transactions in a quarter. So um upon allows Sam to justify his experience with with ubox 1 way transactions.

Virtually flattish year over year, even with moving transactions up and then storage and U box with a higher margin profile also growing faster can you maybe dissect what is causing.

Yeah, you box one way. Transactions are leading the way; they're exceeding. Our truck rental transactions as a percentage.

Margin trends in the quarter or if it's better to reflect over the recent past and maybe the puts and takes to the company margin.

Sure. This is Jason I'll start with that.

We put a new slide in the Investor deck this time around that.

This shows.

Proxy.

Proxy for cash flow, which will be adjusted EBITDA, the EBITDA margin and then the.

Uh, i i i, as far as a rising tide. I I think they're decoupled in, in, in many ways. I certainly don't look at the performance of the 1-way shipping of ubox product and and and, and juxtapose it against the, the truck rental numbers and say, oh well, you know, we only have so much we can go or capped or um, you know, 1 number is dragging down the other. I I don't necessarily see it that way. And uh I think what you you should expect is for ubox

The share of equipment rental revenue.

Versus the share of storage revenue and don't have U box revenue in there yet but.

Uh, performance as a percentage to exceed the truck rental gains that we're able to make. There's, there's little doubt of that.

But the two newer revenue lines storage.

Which is strange calling that newer but that's newer.

Than the original equipment rental revenue.

Both of those when we include those in new projects. It has the effect of increasing the projected return now as you know and you've been to some of our facilities, you'll see how everything kind of intra inter acts and interrelated, it's very hard for us to two.

To break it out separately.

But we certainly have seen that when we add more of each of those products to a location.

Okay, that's helpful. And then, um, 1 to 2, think about the margin profile of the business: 35%, virtually flattish year-over-year, even with moving transactions up and then storage and U-Box with a higher MO margin profile. Also growing faster. Can you maybe dissect what is causing the margin trends in the quarter, or if it's better to reflect over the recent past? And maybe put some takes to the company margin?

Our profitability improves.

Sure, this is Jason. I'll start with that. Um, we we put a new slide in the in the investor deck. This time around that, this shows uh

Okay.

And then maybe to think about the.

Proxy for cash flow, which would be adjusted e. But uh, the EBA margin and then

Some of the dynamics playing out in the storage segment a lot of new.

Facilities and units in the total base.

The share of equipment rental Revenue, uh, versus the share of storage revenue and and we don't have U Box Revenue in there yet. But

Maybe as a headwind to the margin profile of the slides in the last couple of quarters have been helpful to see that can you maybe talk about the glide path there.

But the two new revenue lines, storage, uh, which is strange calling that newer, but it's newer than the original equipment rental revenue.

How units getting soaked up can be positive to margin certain thresholds that.

That need to be hit to elevate the margin within the storage business.

Yes.

You know, and you've been to some of our facilities, you see how everything kind of inter interacts and interrelates. It's very hard for us to

On the slide in the deck that we have that shows where future storage revenue is coming from there is there is a portion of that that shows.

Storage revenue from existing locations or what we call non same store locations loans that haven't hit 90%.

To to break it out separately. Um, but we certainly have seen that that when we add more of each of those products to a location, the

A profitability uh, improves.

And that number taking it from where it is today to where it would be at 90% is somewhere it's going to be somewhere around $260 million.

Give or take by the time, we get there there's likely going to be rate increases that will be a little bit more.

Those are at locations, where we've opened and the expense load has largely been recognized in our financial statements. So that additional revenue.

Yeah.

A very rough estimate will be maybe 80% of that give or take is going to flow to the bottom line.

At some locations that will be more than that at some of the newer locations that might not be all of that.

Okay, that that Temple. And then maybe to think about the sum of the dynamic playing out in the storage segment. A lot of new, uh, facilities and and units in the total base. Um, maybe as a headwind to the margin profile, the slides in the last couple of quarters have been helpful to see that c. Can you maybe talk about the Glide path there of uh how units getting soaked up? Can be positive to margin certain thresholds that that need to be hit to elevate the margin within the storage business.

But as a general rule of thumb to give you a sense so.

A lot of the headwinds that we're facing right now on the EBITDA margin.

Or on the GAAP operating margin.

Yeah, on on this, on the slide in the in the deck that we have that shows where future storage revenue is coming from. There's, there's a portion of that, that shows

Our truck related.

Yeah.

<unk>.

The liability costs associated with the fleet.

We've seen an increase in the.

Storage revenue from existing locations or what we call non same store, locations, ones that haven't hit 90%. And, and that number T, taking it from where it is today, to where it would be at 90%, is somewhere, it's going to be somewhere around, 260 million dollars.

Severity of claims.

Don't think we're seeing more accidents I think the fleet is in real good condition as far as accidents go but the severity of those that were running into is a little bit more significantly we're building reserves backup.

Give or take, you know, by the time we get there, there's likely going to be rate increases. It'll be a little bit more.

Um, those are at locations where we've opened and the expense load is largely been recognized in our financial statements. So that additional Revenue

And thats affecting the margin in that does hit earnings and EBITDA for both of those and then for the earnings cycle.

Depreciation headwinds that we're facing we're going to have to work through this.

You know, a very rough estimate would be maybe 80% of that give or take is going to flow to the bottom line. Uh, it at some locations, it'll be more than that at some of the newer locations that might not be all of that.

Um,

Cohort of trucks and cargo vans, we purchased last two years.

Then.

Likely after this year the spend on the box truck fleet will begin to slow a bit.

but but as a general rule of thumb, to give you a sense. So uh, a lot of the headwinds that we're facing right now on the IBA margin

And then we should.

Peak on depreciation.

And hopefully trend back down.

Were on the Gap, operating margin, um our our truck related. Um you know, it's it's

um,

Okay. That's helpful. Jason and the last quick one for me.

When looking at the pending and developed storage square footage currently at $14 8 million that's been sliding down for a few quarters is that a number that you expect to kind of gradually keep coming down over the next few quarters or is there a level.

the liability costs associated with the fleet, you know, we've we've seen an increase in in the, um,

Severity of claims. Uh, I don't think we're seeing more accidents. I think the the fleet is in real good condition as far as accidents go, but the severity of those that were running into is a little bit more significant and we're building reserves back up.

Developed in pending square footage that you think it is a minimum level that we do not want to go under.

Okay.

There certainly is an amount that we don't want to go under I don't think we're close to that right now.

Um, and and, and that's affecting the margin and that does hit earnings and even, uh, for, for both of those, and then for the earning cycle, it's, it's this depreciation headwind that, that we're facing. We're going to have to work.

What we've been trying to do is slow the spend.

Not because we don't believe in self storage or not because we don't want to expand but because we want to be.

Be rational in our capital.

<unk> allocation to make sure that we have enough.

Through this, uh, cohort of trucks that, uh, cargo vans, we purchased the last 2 years. And then, uh, likely after this year, the spend on the box truck, Fleet will begin to slow a bit um and and then we should Peak on on depreciation and and then hopefully Trend back down.

Enough to last us and with the way that the fleet has been chewing up some capital during this timeframe.

We're pulling back a little bit on real estate spend.

But you don't want to pull back too much where you have what happens.

During COVID-19, where we shut a bunch of stuff down and then it takes a while to start it back up and you get kind of this unusual amount if we could stay somewhere in the <unk>.

Four five to 6 million square foot range each year I think that's something that operationally, we've proven that we can handle it.

And if we do that spending is likely to continue to decrease.

Okay, that's helpful, Jason. This is the last Quick 1 for me. When looking at the pending and developed storage square footage, currently at 14.8 million, that's been sliding down for a few quarters. Is that a number that you expect to kind of gradually keep coming down over the next few quarters? Or is there a level of developed and pending square footage that you think is a minimum level that we do not want to go under?

That's great color. Thank you.

Yeah.

Our next question is from.

From Wolfe Research your line is now open.

There there certainly is an amount that we don't want to go under. I don't think we're close to that right now. Um, what what we're we've been trying to do is slow the spend

Hey, good morning, everyone and thank you for taking the question. So really just wanted to double click first on B.

Transaction volume desktop.

Um, not because we don't believe in self storage or not because we don't want to expand, but because we want to be rational in our Capital allocation and make sure that that we have enough.

Flat, maybe slightly up in the quarter just wondering if you guys noticed anything in terms of.

Sort of like from one month right.

Um, enough to last us. And with the way that the fleet has been showing up some capital during this time frame, we're pulling back a little bit on real estate spend.

And flat in the quarter, but the month month trend was it like improving through the quarter alright.

Pretty steady for the quarter.

Any color would be helpful.

Sure all of our comparisons are going to be year over year because our.

But you don't want to pull back too much. Where you have, what happens to us during Co where we, we shut a bunch of stuff down and then it takes a while to start it back up and you get kind of this unusual amount. If if we could say somewhere in the

Our business doesn't really.

Compare well month to month, so our best quarter for moving is really our second quarter.

The second best would be the first quarter that we just finished and then it goes third quarter and the fourth quarters are worst so we're always comparing with how we did the year before because largely moving activity.

We do believe that spending is likely to continue to decrease.

It's a great color. Thank you.

To look the same year over year so.

All right. Next question is from Andy Lou from Wall Street. Your line is open.

While I mentioned for July as we're again seeing.

I appreciate it. Good morning everyone. And I thank you for taking the question. Uh, so really just wanted to

Revenue increase from.

Our rates that we're having to charge because our cost of doing business has gone up.

But we havent yet seen traction on the.

On <unk>.

Transactions and we're going through a process right now I mentioned that the.

The fleet the size of the fleet has increased I think.

From last year were up maybe 5700 trucks from last quarter, we're up about 5000 trucks.

Uh double click first on the uh transaction volume you guys talked. I was kind of you know, flash maybe slightly up in the quarter just wondering if you guys notice anything. In terms of you guys speak to you know sort of like a 1 month Trend. You know if it's flat in the quarter, but has the month month, Trend kind of was like improving through the quarter or is it, you know, kind of pretty steady to the quarter? Any kind of any color will be helpful.

Sure, all of our comparisons are going to be year over year because our our business doesn't really.

But were also up.

Close to 800 locations compared to last year.

Between dealer locations and our company locations.

Compare well month to month. So, you know, our our our best quarter for moving is really our second quarter.

So we're going through the process, which is fairly difficult.

Placing this new equipment in places that we think is going to be productive and opening dealers in doing that.

Efficient fashion and.

That's what we're working on now now if that doesn't work out the way that we think it is we will probably end up increasing the sales of trucks and reduce the size of the fleet, but right now we think theres opportunity.

The second best would be the first quarter that we just finished. And then it goes third quarter, and the fourth quarter is our worst. So we're always comparing with how we did the year before, because movement activity tends to look the same year over year. So, um, what I mentioned for July is we're again seeing.

To use these trucks.

Um Revenue increase from uh rates that we're having to charge because our cost of doing business has gone up.

To give you a sense of the the challenge that we're facing in the last two years.

Uh, but we haven't yet seen traction on the

The number of locations that we've added is equal to the size of our our second largest truck competitor right. So.

On on transactions and and we're going through a process right now. I mentioned that the the fleet the size of the fleet is increased. I think

And opening that many locations and distributing trucks across them and getting customers and our team to PPL to route customers both locations.

From last year, we're up maybe 5,700 trucks from last quarter or up about 5,000 trucks.

As a bit of a challenge and that's what we're working through right now and we're working through it at the same time that we're investing quite a bit in the fleet.

But we're also up um, you know close to 800 locations compared to last year uh between dealer locations and and our Company locations.

Our plan is that all of this is going to pay off in the years to come.

So we're we're going through the process, which is fairly difficult of.

Got it got it.

Sorry about that.

Question, a little clearer.

Monthly trend how did April year over year.

May year over year and your year over year is that have you been on a year over year.

For all three months or has it been maybe.

Improving on a year over year basis from April.

Thank you.

Placing this new equipment in places that we think it's going to be productive and and opening dealers and doing that in in a efficient fashion. And that's that's what we're working on now. Now if that doesn't work out the way that we think it is, we'll probably end up increasing the sales of trucks and reduce the the size of the fleet. But right now we think there's an opportunity.

Got it okay. Good afternoon.

I want to stress that one didnt I.

So.

The revenue has been steadily up year over year, I would say that the transactions. We have we have some on waste and some off leaks and.

And we deal with the same issue that we've dealt with since the very beginning of the company and that is people tend to move at the end of the month.

So you get this cluster of transactions at the end of the month and depending upon how the calendar falls from year to year you can see these weird oddities. So looking at it over a three month period to tend to flatten some of that out and what I would say is we still haven't got traction.

To, to use these trucks, um, you know, to, to give you a sense of the the challenge that we're facing in the last 2 years. The number of locations that we've added is, is equal to the size of our, our second largest truck competitor, right? So, you know, in in, in opening that many locations and distributing trucks across them and getting customers, and our team to be able to Route customers to those locations.

Is a bit of a challenge and that's what we're working through right now and we're working through it. At the same time that we're investing quite a bit in the fleet but our our plan is that all of this is going to pay off in in the years to come

However, you want to look at it month over.

Month versus last year or for the three months that the traction is still hasnt hasnt hit.

And I'm not seeing that in July yet either but it's not like we're far off there. Some weeks that were up on transactions. So we're right there.

Got it, got it. And, and sorry about that. Probably should have went my question, a little clearer. And then, like, and then once we Trend, as in, you know, how did April year over year ago, how they made year over year and June, year over year, is that, has it been kind of over your slack for all 3 months, or has it been, you know, maybe uh, improving on a year-over-year basis from April through?

We're right there.

Yeah.

Okay got it got it. Thank you that's helpful and then kind of shifting over to the slide.

Slide as far as Stefan you guys.

Slide six so I think that segment getting you guys are pushing for a little more segments that really want to ask on that slide on the.

Sure you know revenue coming out on why you guys gave.

Got it. Okay, yeah, I I went, I went to stray on that 1. I, um, so the revenue has been steadily up year-over-year. I would say that transactions. We have, we have some on leaks and some off weeks. And, and, and we're we deal with the same issue that we've dealt with since the very beginning of the company and that is people tend to move at the end of the month.

That future will look like on a revenue basis have you guys looked at it maybe on an NOI on EBITDA basis kind of what's that.

Yes.

Finance.

You guys don't disclose volume, but just wanted to get a sense.

So, you get this cluster of transactions at the end of the month. And depending upon how the calendar falls from year to year, you can see these weird oddities. So, looking at it over a 3-month period to flatten some of that out. And what I would say is we still haven't got traction.

If that is the revenue number because you know how that hits the bottom line.

Yes, I am.

Answer the question for Chris.

For Stephen just now.

However, you want to look at it month over, you know, month versus last year or for the 3 months, the the traction still hasn't hasn't hit. Um,

Non same store locations that are already open.

The additional revenue somewhere around I would say, 80% of that should probably fall to the bottom line.

And I'm not saying that in July yet either, but it's not like we're far off. There are some weeks that we're up on transactions. So we're right there.

Youre asking about the other ones that haven't opened yet those are tougher because as a whole has most of them have all of our product lines embedded in so I don't have.

we're we're right there.

A clear answer to that.

To give you on that because.

Breaking out storage.

Revenue as part of that.

No it's not.

Thats all I hear anything on.

That's fine so Ken I guess.

Another way maybe on the development.

The spending side of that.

How much.

The cost for you.

This pipeline.

Yeah.

Great.

We look back period, you did about $5 $5 billion of investment he brought 26 million square feet.

Not quite on a revenue basis. Have you guys looked at it? Maybe on, even an noi or even data basis, kind of what that um, you know, future pipeline is, you know, I know you guys go to school as large and just want to get a sense, you know, if that is the revenue number just, you know how that gets the bottom line,

Yeah, you know, I answered a question for...

The new space, our lines that kind of facts.

200, Bucks, but I'm not sure yet.

Okay, alright, thank going for it.

Yes, I don't know if I would I would be here. This long aside allowed a bunch of $220 a foot storage.

Yes.

So that on that slide the $5 8 billion.

For Stephen. Just now on the on this, non same store locations that are already open the, the additional Revenue somewhere around, I would say 80% of, that should probably fall to, to the bottom line. If you're asking about the the the other ones that haven't opened yet, those are tougher because it has a whole has most of them have all of our product lines embedded. And so I I don't have a a, a clear answer to

<unk> represents the amount that we spent in that five years. So it's not exactly thats not for the.

To give you an update on that, because we are breaking out storage revenue as part of that.

That doesn't represent the 26 million square feet that went on and it represents a big portion of it but.

I'd say, there's two complicating factors to that calculation one is.

Because we do all of this development on balance sheet. There is a certain amount that we spent there.

That isn't yet productive right. We bought the properties we've started considerably of construction in progress, but theyre not renting rooms yet.

For the last couple of years that numbers run about a $1 billion seven were probably above.

1 billion $6 90.

In.

No, no. It's, you know, it's, it's totally serious if you're on, um, on that front. So kind of gets, um, asking another way. Maybe on the development, you know, the the spending side of it, you know, kind of how much does it cost for you to you know, put this pipeline up as I look at you know your slides, right? And if you have a 5 year lookback period, you did about 5 and a half billion dollars of Investments and you crossed 26 million square feet of new space online. So I kind of backed into like 200 bucks a foot. I'm not sure if that's like a good.

Capital, we've invested that isn't really producing revenue right now.

Okay, for this thing going forward.

And I would say five years ago that number was probably closer to.

One 1 billion.

So then I would take $650 million out of.

The numerator because that really is extra money spent on assets that aren't productive yet.

And then the part that's a little also challenging.

Figure out is that also includes building U box warehouse space.

And if you were to convert the amount of covered spaces that we've added the last five years to storage.

Yeah, I I don't know if I I would be I would be here this long. If I allowed a bunch of 220, a foot storage to to okay. Yeah, yeah for sure. Um, so that on that slide the the 5.8 billion is represents the amount that we spent in that 5 years so it's it's not exactly that. That's not for the. That doesn't represent the the 26 million square feet. That went on. It represents a big portion of it but the the I I'd say there's 2 complicated factors to that calculation 1 is

Square foot because each one of those boxes.

because we do all this development on balance sheet, there's a certain amount that we've spent

It's a five by storage room.

That's going to add somewhere between eight to 9 million square feet of self storage space.

That isn't yet productive. Right? We've, we've bought the properties. We've started, we have construction and progress but they're not renting rooms yet.

No.

In reality, what the number could get too for our investment per foot should be much closer to say $150. That's the long.

For the last couple of years, that number has run about $1 billion. We're probably about...

Story to get to the short answer which is it should be about 150.

a, a billion $690 in in

Okay got it got it Super helpful. And then I started last question for me I know you guys you know what I asked last quarter as well.

Uh, capital is invested. That isn't really producing Revenue right now.

and I would say 5 years ago, that number was probably closer to

a billion.

Yes, the only thing you guys said on resource development, you guys mentioned, Eric its Mike.

so then I would take

650 million out of

It was like 10% right so it would be.

Just curious how you guys or is that 10% number is that 10% the one.

The numerator because that that really is extra money, that's spent on assets that aren't productive yet.

Per square foot span.

Hey, I guess preference or is there.

Let's say you're using to calculate the 10%.

And then the part that's a little also challenging to to figure out is that also includes building ubox warehouse space.

Yes, that's going to be the Unlevered IRR. So you take the total investment in the property.

And if, if you were to convert the amount of covered spaces that we've added in the last 5 years to storage,

And we're looking out.

Square foot. Because each one of those boxes is a

I think at seven to 10 years within capping it at the end of that timeframe and looking to see how it performs over that timeframe.

is a 5 by 8 storage room.

If you were trying to convert that to a cap rate, it's probably going to be somewhere between 758.

That's going to add somewhere between 8 to 9 million square feet of self storage space. So in, in reality, what the number should get to for our investment per foot, should be much closer to say, 150 a foot. Is that that's the long.

Okay Awesome Super helpful. Thanks, So much for taking my question.

Story to get to the short answer, which is it should be about 150.

A great day.

You too thank you.

There are no further questions at this time I would now like to share the conference back over to management for any closing remarks.

Well this is Jason <unk>.

Hope everyone's just holding their questions for the annual Investor day, which is going to be in about two weeks.

If you have any any feedback in between please feel free to shoot to us otherwise we will.

We look forward to seeing you then thank you very much.

Okay, got it, got it. Super helpful. And then I started last question for me. I know you guys, you know, and I asked last quarter as well the um development, you know, the user that you guys get on these stores at the moment. You guys mentioned, it was closer to like, I think it was like 10%, right? So it would be. So just curious how you guys close that. 10% number is that 10% on the 150 of first square foot spend that you just uh, that you just referenced. Or is there, is there a different method that you're using to calculate the 10%?

This concludes today's conference call. Thank you for participating you may now disconnect.

Yeah, that that's going to be the the unlevered irr. So you take your total investment in the property.

And we're looking out.

I think it's 7 to 10 years within capping it at at the end of that time frame and and looking to see how how it performs over that time frame.

Um,

On, if you were to try to convert that to a cap rate, it's probably going to be somewhere between 7 and a half 8.

Okay, awesome. Super helpful. Thanks so much for taking my questions. Have a good have a great day you too. Thank you.

No further questions at this time, I would now like to share in the conference back over to management for the closing remarks.

Well, this is Jason, I I hope everyone's just holding their their questions for the annual investor day, which is going to be in in about 2 weeks.

Any feedback in between, please feel free to to shoot it to us. Otherwise we will uh we, we look forward to to seeing you then. Thank you very much.

This concludes today's conference call, thank you for participating. You may now disconnect