8-K 1 eightk123106.txt 4TH QUARTER 2006 - EARNINGS UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 -------------------------------------------------------------- FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported): January 25, 2007 HEARTLAND EXPRESS, INC. (Exact name of registrant as specified in its charter) Commission File Number - 0-15087 NEVADA 93-0926999 (State of other Jurisdiction (IRS Employer ID No.) of Incorporation) 2777 HEARTLAND DRIVE, CORALVILLE, IOWA 52241 (Address of Principal Executive Offices) (Zip Code) Registrant's Telephone Number (including area code): 319-545-2728 Item 9.01. Financial Statements and Exhibits Exhibit 99.1 - Heartland Express, Inc. press release dated January 25, 2007 with respect to the Company's financial results for the quarter ended December 31, 2006. Item 2.02. Results of Operations and Financial Condition. On January 25, 2007, Heartland Express, Inc. announced its financial results for the quarter ended December 31, 2006. The press release is attached as Exhibit 99.1 to this Form 8-K and is incorporated herein by reference. SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on behalf by the undersigned thereunto duly authorized. HEARTLAND EXPRESS, INC. Date: January 25, 2007 BY:/s/John P. Cosaert ----------------------- JOHN P. COSAERT Vice-President Finance and Treasurer Exhibit No. 99.1 Thursday, January 25, 2007, For Immediate Release Press Release Heartland Express, Inc. Reports Revenues and Earnings for the Fourth Quarter of 2006. CORALVILLE, IOWA - January 25, 2007 - Heartland Express, Inc. (Nasdaq: HTLD) announced today financial results for the quarter and year ended December 31, 2006. Operating revenues for the quarter increased 4.8% to $146.8 million from $140.1 million in the fourth quarter of 2005. Net income decreased 9.2% to $19.6 million from $21.6 million in the 2005 period. Earnings per share were $0.20 compared to $0.22 for the fourth quarter of 2005. For the year ended December 31, 2006, operating revenues increased 9.2% to $571.9 from $523.8 during the same period in 2005. Net income increased 21.2% to $87.2 million from $71.9 million in the 2005 period. Earnings per share were $0.89 compared with $0.73 for the 2005 period. Gains on disposal of revenue equipment decreased to $0.6 million in the fourth quarter of 2006 compared to $5.8 million in the fourth quarter of 2005 primarily due to fewer trade-ins of revenue equipment. As a result, earnings per share were negatively impacted $0.03 per share for the quarter ended December 31, 2006. Operating results for the year are impacted by gains primarily from the trade of revenue equipment. Effective July 1, 2005 gains from the trade of revenue equipment are being recognized in operating income in compliance with Statement of Financial Accounting Standards ("SFAS") No. 153, "Accounting for Non-monetary Transactions". Prior to July 1, 2005 gains from the trade-in of revenue equipment were deferred and presented as a reduction of the depreciable basis of new revenue equipment. Gains on disposal of revenue equipment increased to $18.1 million during the year compared to $8.0 million in 2005. As a result, earnings per share were positively impacted $0.07 per share for the year ended December 31, 2006. Depreciation expense increased $3.3 million during the year ended December 31, 2006 as a result of SFAS No. 153, resulting in a decrease of $0.02 earnings per share. For the quarter, Heartland Express, Inc. posted an operating ratio (operating expenses as a percentage of operating revenues) of 81.4% and a 13.4% net margin. The Company reported an operating ratio of 78.4% and a 15.2% net margin for the year ended December 31, 2006. The Company ended the year with cash, cash equivalents, and short-term investments of $331.3 million, a $43.7 million increase from the $287.6 million reported on December 31, 2005. The Company's balance sheet continues to be debt-free. The Company completed the upgrade of its tractor fleet during the quarter. The Company took delivery of 400 new International tractors during the period and will take delivery of additional units in the first quarter. Federally mandated engine emission standards are required for all newly-manufactured engines beginning in January 2007. The Company is taking delivery of additional new trucks with pre-2007 engines because of the higher costs and untested technology associated with the new engine. The average age of the Company's tractor fleet was 1.2 years at December 31, 2006. The average age of the Company's trailer fleet was 3.1 years at December 31, 2006 with primarily the entire trailer fleet consisting of 2002 or newer model year Wabash trailers. During the quarter, Heartland Express declared a regular quarterly cash dividend. The quarterly dividend of approximately $2.0 million at the rate of $0.02 per share was paid on January 2, 2007 to shareholders of record at the close of business on December 21, 2006. The Company has now paid cash dividends of $20.3 million over the past fourteen consecutive quarters. In addition, the Company declared a 4-for-3 stock split, paid as a 33% stock dividend in the second quarter of 2006. This was the Company's ninth stock split since going public in 1986. The Company's annual cash dividend increased approximately $2.0 million per year, a 33% increase. All share and per share data presented have been adjusted retroactively to reflect the effect of the stock split. The Company purchased 176,700 shares of its outstanding common stock during the year. There are 4.9 million shares remaining under the repurchase program approved in September 2001 by its Board of Directors. Our strong cash position has allowed us to improve shareholder return with share repurchases and cash dividends without effecting growth opportunities. This repurchase of shares demonstrates the Board of Director's confidence in the Company's performance and future prospects. Heartland Express was named to the Forbes Magazine's list of the "200 Best Small Companies in America" for the fifth consecutive year and the fifteenth time during its twenty years as a public company. 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. Contact: Heartland Express, Inc. Mike Gerdin, President John Cosaert, Chief Financial Officer 319-545-2728 HEARTLAND EXPRESS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME
Three months ended Twelve months ended December 31, December 31, 2006 2005 2006 2005 ---- ---- ---- ---- OPERATING REVENUE ......................... $ 146,803,756 $ 140,054,231 $ 571,919,173 $ 523,792,747 ------------- ------------- ------------- ------------- OPERATING EXPENSES: Salaries, wages, benefits .............. $ 48,842,108 $ 42,987,613 $ 189,179,381 $ 174,180,078 Rent and purchased transportation ...... 5,322,346 6,630,550 24,388,010 29,634,982 Fuel ................................... 36,518,430 35,509,621 146,240,090 123,557,662 Operations and maintenance ............. 3,016,657 4,537,916 12,646,506 14,955,409 Operating taxes and licenses ........... 2,612,938 2,463,156 9,143,059 8,968,439 Insurance and claims ................... 5,076,975 6,120,904 16,620,678 17,938,170 Communications and utilities ........... 913,335 958,068 3,721,282 3,554,328 Depreciation ........................... 13,545,636 10,967,604 47,351,247 38,228,334 Other operating expenses ............... 4,243,309 4,216,045 17,356,647 16,695,948 Gain on disposal of property & equipment (572,157) (5,769,251) (18,143,924) (8,031,915) ------------- ------------- ------------- ------------- 119,519,577 108,622,226 448,502,976 419,681,435 ------------- ------------- ------------- ------------- Operating income .......... 27,284,179 31,432,005 123,416,197 104,111,312 Interest income ........................ 3,178,031 2,119,595 11,731,973 7,372,543 ------------- ------------- ------------- ------------- Income before income taxes ............. 30,462,210 33,551,600 135,148,170 111,483,855 Federal and state income taxes .......... 10,814,083 11,912,142 47,977,601 39,578,093 ------------- ------------- ------------- ------------- Net income ............................. $ 19,648,127 $ 21,639,458 $ 87,170,569 $ 71,905,762 ============= ============= ============= ============= Earnings per share ..................... $ 0.20 $ 0.22 $ 0.89 $ 0.73 ============= ============= ============= ============= Weighted average shares outstanding ............................ 98,251,889 98,428,589 98,359,361 99,125,254 ============= ============= ============= ============= Dividends declared per share ........... $ 0.020 $ 0.015 $ 0.075 $ 0.060 ============= ============= ============= =============
HEARTLAND EXPRESS, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS ASSETS December 31, December 31, 2006 2005 ------------- -------------
CURRENT ASSETS Cash and cash equivalents ................ $ 8,458,882 $ 5,366,929 Short-term investments ................... 322,829,306 282,255,377 Trade receivables ........................ 43,499,482 42,860,411 Prepaid tires ............................ 5,075,566 3,998,430 Other prepaid expenses ................... 1,635,077 304,667 Deferred income taxes .................... 29,177,000 28,721,000 ------------- ------------- Total current assets .................. $ 410,675,313 $ 363,506,814 ------------- ------------- PROPERTY AND EQUIPMENT ..................... $ 344,323,852 $ 281,710,956 Less accumulated depreciation ............ 96,293,111 81,204,416 ------------- ------------- $ 248,030,741 $ 200,506,540 ------------- ------------- OTHER ASSETS ............................... $ 10,363,658 $ 9,494,571 ------------- ------------- $ 669,069,712 $ 573,507,925 ============= ============= LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES Accounts payable & accrued liabilities ... $ 15,075,647 $ 10,572,525 Compensation & benefits .................. 15,028,378 12,629,831 Income taxes payable ..................... 11,721,610 8,064,947 Insurance accruals ....................... 56,651,853 53,631,471 Other accruals ........................... 8,248,415 7,345,499 ------------- ------------- Total current liabilities ............. $ 106,725,903 $ 92,244,273 ------------- ------------- DEFERRED INCOME TAXES ...................... $ 56,408,000 $ 48,012,000 ------------- ------------- COMMITMENTS AND CONTINGENCIES STOCKHOLDERS' EQUITY Capital stock: common, $.01 par value; authorized 395,000,000 shares; issued and outstanding 98,251,889 in 2006 and 98,428,589 in 2005 ....................... $ 982,519 $ 738,215 Additional paid-in capital ............... 376,029 -- Retained earnings ........................ 504,577,261 432,952,138 ------------- ------------- $ 505,935,809 $ 433,690,353 Less unearned compensation ............... -- (438,701) ------------- ------------- $ 505,935,809 $ 433,251,652 ------------- ------------- $ 669,069,712 $ 573,507,925 ============= =============