U-Haul 2007 Annual Report Download - page 16

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10
W
l
levera ca :
flows from operations to debt service payments
enue. In
ations of existing or future
re
ging regulations could substantially impair real property and equipment
It
olved staff comments at March 31, 2007.
It
ly facilities. We also operate over 245 fixed site-repair
fa
management fees received by U-Haul for other properties owned by unrelated parties and previously managed by us.
e are highly leveraged.
As of March 31, 2007 we had total debt outstanding of $1,181.2 million. Although we believe that additiona
ge n be supported by the Company’ s operations, our existing debt could impact us in the following ways
• require us to allocate a considerable portion of cash
• limit our ability to obtain additional financing
• place us at a disadvantage compared to our competitors who may have less debt
Our ability to make payments on our debt depends upon our ability to maintain and improve our operating
performance and generate cash flow. To some extent, this is subject to prevailing economic and competitive
conditions and to certain financial, business and other factors, some of which are beyond our control. If we are
unable to generate sufficient cash flow from operations to service our debt and meet our other cash needs, we may
be forced to reduce or delay capital expenditures, sell assets or operations, seek additional capital or restructure or
refinance our indebtedness. If we must sell our assets, it may negatively affect our ability to generate rev
addition, we may incur additional debt that would exacerbate the risks associated with our indebtedness.
We operate in a highly regulated industry and changes in existing regulations or viol
gulations could have a material adverse effect on our operations and profitability.
Our truck and trailer rental business is subject to regulation by various federal, state and foreign governmental
entities. Specifically, the U.S. Department of Transportation and various state and federal agencies exercise broad
powers over our motor carrier operations, safety, and the generation, handling, storage, treatment and disposal of
waste materials. In addition, our storage business is also subject to federal, state and local laws and regulations
relating to environmental protection and human health and safety. The failure to adhere to these laws and regulations
may adversely affect our ability to sell or rent such property or to use the property as collateral for future
borrowings. Compliance with chan
productivity and increase our costs.
em 1B.
Unresolved Staff Comments
There were no unres
em 2.
Properties
The Company, through its legal subsidiaries, owns property, plant and equipment that are utilized in the
manufacture, repair and rental of U-Haul equipment and storage space as well as providing office space for the
Company. Such facilities exist throughout the United States and Canada. The Company also manages storage
facilities owned by others. The Company operates nearly 1,450 U-Haul retail centers of which 498 are managed for
other owners, and operates 13 manufacturing and assemb
cilities located throughout the United States and Canada.
SAC Holdings owns property, plant and equipment that are utilized in the sale of moving supplies, rental of self-
storage rooms and U-Haul equipment. Such facilities exist throughout the United States and Canada. We manage the
storage facilities under property management agreements whereby the management fees are consistent with