Heartland Express, Inc. Reports Revenues and Earnings for the Third Quarter of 2012

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| Source: Heartland Express, Inc.

NORTH LIBERTY, Iowa, Oct. 11, 2012 (GLOBE NEWSWIRE) -- Heartland Express, Inc. (Nasdaq:HTLD) announced today financial results for the quarter ended September 30, 2012. Operating revenues for the quarter increased 1.9% to $135.0 million from $132.5 million in the third quarter of 2011. Operating revenues for the nine month period increased 3.1% to $409.6 million from $397.4 million in the 2011 period. Operating income for the three and nine month periods of 2012 were negatively impacted by a $5.1 million and $12.9 million decrease in gains on disposal of property and equipment, respectively. Net income was $12.4 million in the 2012 quarter period compared to $15.4 million in the 2011 quarter period, a 19.3% decrease. Net income was $47.2 million in the nine month period ended September 30, 2012 compared to $52.8 million in the same nine month period in 2011, a 10.5% decrease. Basic earnings per share decreased 11.8% to $0.15 from $0.17 reported in the third quarter of 2011. Basic earnings per share decreased 5.2% to $0.55 from $0.58 reported in the first nine months of 2011.

Fuel surcharge revenues for the quarter decreased 1.0% to $27.1 million from $27.4 million in the third quarter of 2011. Fuel surcharge revenues for the nine month period increased 3.9% to $84.4 million from $81.3 million in the 2011 nine month period. For the quarter, we posted an operating ratio (operating expenses as a percentage of operating revenues) of 85.4% and a 9.2% net margin (net income as a percentage of operating revenues). For the nine month period, the Company posted an operating ratio of 82.9% and an 11.5% net margin.

The industry continues to be challenged by the shortage of qualified drivers and erratic fuel prices. We achieved minimal fleet growth in the 3rd quarter of 2012 compared to the third quarter of 2011. We continue to aggressively manage our fuel cost through newer model revenue equipment and strategic fuel purchasing decisions. Fuel expense increased $1.5 million or 3.6% during the quarter. The U.S. average cost of diesel fuel was $3.957 per gallon during the third quarter of 2012 compared to $3.859 per gallon in the third quarter of 2011, a 2.5% increase. The average cost of diesel fuel increased approximately $0.40 per gallon during the 3rd quarter of 2012 and the spread between the highest price and lowest price during the quarter was $0.45 per gallon. Fuel price swings of this nature will continue to have negative impacts to our earnings.

The average age of our tractor fleet was 2.4 years as of September 30, 2012 with all of the fleet being 2010 models and newer. The average age of our trailer fleet has improved to 3.3 years at September 30, 2012 compared to 4.2 years at September 30, 2011. We will continue to take advantage of the favorable used trailer market throughout the 4th quarter to upgrade our trailer fleet. As of September 30, 2012 we had taken delivery of 974 new Wabash trailers during 2012 including delivery of 496 during the 3rd quarter. We anticipate delivery of an additional 26 trailers in October. By the end of the year, 100% of our trailer fleet will be 2007 models or newer.

Our financial position continues to be strong. We ended the quarter with cash, cash equivalents, and long-term investments totaling $233.8 million, a $43.5 million increase from the $190.3 million reported at December 31, 2011. Long-term investments include $22.3 million of illiquid auction rate securities, at par. Since February 2008, the Company has received $176.1 million in calls, all at par. No calls were received during the third quarter of 2012. Net cash flows from operations continue to be strong at 16.5% of operating revenues. The Company's balance sheet continues to be debt-free with total assets of $546.3 million. The Company ended the past twelve month period with a return on total assets of 11.8% and a 17.9% return on equity.

Commitment to our shareholders continues through the payment of cash dividends and the purchase of our common stock. A dividend of $0.02 per share was declared during the quarter and was paid on October 2, 2012. The Company has now paid cumulative cash dividends of $349.8 million, including two special dividends, over the past thirty-seven consecutive quarters. Also, we repurchased 690,906 shares of our common stock during the quarter for approximately $9.5 million. At September 30, 2012, we had 3.9 million remaining shares under our share repurchase program.

Award winning on-time service is the foundation of our organization. This year we have been recognized with several customer service awards. These awards include the Eastman Chemical 2011 Supplier Excellence Award for the sixteenth consecutive year, the 2011 Winegard Company Truckload Carrier of the Year Award, the Cost Plus World Market 2011 Premier Carrier Partner Award, the Lowe's 2011 Gold Carrier Award, the Walmart Transportation 2011 Sam's Carrier of the Year Award, the Nestle Waters Madison 2011 World Class Customer Service Award, the FedEx SmartPost Carrier of the Year award for the fifth time, the FedEx Gold Service Award for 99.87% on time service, the Dupont 2011 Outstanding Service Award, TransFreight Certificate of Appreciation for dedication to exceptional performance, the United Sugars 2012 Service in Excellence Award, the Sonoco 2012 Prospector Award, the Schneider Logistics Carrier of the Year Award, the 2011 BP Safety Award, and the LXP Managed Freight Elite Fleet Member Award. In addition, we received the Fleet Owner magazine 2011 For-Hire Fleet of the Year and the Logistics Management magazine Dry-Freight Carriers Quest for Quality Award for the tenth consecutive year as well as the Environmental Protection Agency's SmartWay Excellence Award.

This press release may contain statements that might be considered as forward-looking statements or predictions of future operations. Such statements are based on management's belief or interpretation of information currently available. These statements and assumptions involve certain risks and uncertainties. Actual events may differ from these expectations as specified from time to time in filings with the Securities and Exchange Commission.

         
HEARTLAND EXPRESS, INC. 
AND SUBSIDIARIES 
         
CONSOLIDATED STATEMENTS OF INCOME   
(Unaudited, in thousands, except per share amounts)
         
  Three Months Ended
September 30,
Nine Months Ended
September 30,
  2012 2011 2012 2011
OPERATING REVENUE $ 135,010 $ 132,529 $ 409,552 $ 397,413
         
OPERATING EXPENSES:        
Salaries, wages, and benefits $ 40,899 $ 40,903 $ 125,857 $ 124,832
Rent and purchased transportation 1,495 1,832 4,752 5,767
Fuel 42,443 40,966 126,259 122,421
Operations and maintenance 6,468 5,257 18,371 16,504
Operating taxes and licenses 2,122 2,400 6,445 6,952
Insurance and claims 4,832 3,920 11,297 10,373
Communications and utilities 756 770 2,249 2,141
Depreciation 14,250 14,900 42,184 40,942
Other operating expenses 3,752 3,248 11,379 10,119
Gain on disposal of property and equipment (1,674) (6,799) (9,433) (22,329)
         
  115,343 107,397 339,360 317,722
         
Operating income 19,667 25,132 70,192 79,691
         
Interest income 191 174 500 620
         
Income before income taxes 19,858 25,306 70,692 80,311
         
Federal and state income taxes 7,424 9,907 23,443 27,501
         
Net income $ 12,434 $ 15,399 $ 47,249 $ 52,810
         
Earnings per share        
Basic $ 0.15 $ 0.17 $ 0.55 $ 0.58
Diluted $ 0.14 $ 0.17 $ 0.55 $ 0.58
         
Weighted average shares outstanding        
Basic 85,646 90,129 86,189 90,500
Diluted 85,925 90,129 86,508 90,500
         
Dividends declared per share $ 0.02 $ 0.02 $ 0.06 $ 0.06
         
     
HEARTLAND EXPRESS, INC.
AND SUBSIDIARIES
     
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except per share amounts)
     
  September 30, December 31,
ASSETS 2012 2011
CURRENT ASSETS (Unaudited)  
Cash and cash equivalents $ 212,741 $ 139,770
Trade receivables, net 50,756 44,198
Prepaid tires 7,146 12,820
Other current assets 4,550 1,932
Income tax receivable 1,828 314
Deferred income taxes, net 13,069 14,401
Total current assets 290,090 213,435
     
PROPERTY AND EQUIPMENT 410,268 409,710
Less accumulated depreciation 188,280 161,269
  221,988 248,441
LONG-TERM INVESTMENTS 21,041 50,569
OTHER ASSETS 13,225 13,221
  $ 546,344 $ 525,666
LIABILITIES AND STOCKHOLDERS' EQUITY    
CURRENT LIABILITIES    
Accounts payable and accrued liabilities $ 9,258 $ 9,088
Compensation and benefits 16,928 15,493
Insurance accruals 13,916 13,997
Other accruals 7,384 7,085
Total current liabilities 47,486 45,663
LONG-TERM LIABILITIES    
Income taxes payable 21,855 24,077
Deferred income taxes, net 47,263 57,661
Insurance accruals less current portion 57,582 57,494
Total long-term liabilities 126,700 139,232
COMMITMENTS AND CONTINGENCIES    
STOCKHOLDERS' EQUITY    
Capital stock, common, $.01 par value; authorized 395,000 shares; issued 90,689 in 2012 and 2011; outstanding 85,490 in 2012 and 86,475 in 2011 907 907
Additional paid-in capital 2,589 589
Retained earnings 440,768 398,706
Treasury stock, at cost; 5,199 shares in 2012 and 4,214 shares in 2011 (70,822) (56,350)
Accumulated other comprehensive loss (1,284) (3,081)
  372,158 340,771
  $ 546,344 $ 525,666
     
Heartland Express, Inc.
Mike Gerdin, Chief Executive Officer
John Cosaert, Chief Financial Officer
319-626-3600