NORTH LIBERTY, Iowa, April 22, 2015 (GLOBE NEWSWIRE) -- Heartland Express, Inc. (Nasdaq: HTLD ) announced today financial results for the quarter ended March 31, 2015. Highlights of the quarter included:
- Net Income increased 25.1%,
- Earnings per share increased 25%,
- Record cash flows from operations of $55.7 million,
- Repaid all long-term debt within 14 months of initial borrowing,
- Operating results increased cash reserves by $34.9 million,
- Year-over-year operating ratio improvement from 90.8% to 84.9%,
- 13% increase in average driver wages, including detention pay after 1 hour.
Financial Results
Heartland Express (the "Company") ended the first quarter of 2015 with net income of $17.6 million, compared to $14.1 million in the first quarter of 2014, a 25.1% increase. Basic earnings per share were $0.20 during the quarter compared to $0.16 earnings per share in the first quarter of 2014, a 25.0% increase. Operating revenues were $187.5 million, a 16.5% decrease, compared to $224.5 million in the first quarter of 2014. Operating revenues for the quarter included fuel surcharge revenues of $26.1 million compared to $45.9 million in the same period of 2014, a $19.8 million decrease. Operating revenues decreased 9.6% excluding the impact of fuel surcharge revenues. Operating income for the three-month period was positively impacted by an $8.1 million increase in gains on disposal of property and equipment and a $9.6 million decrease in net fuel expense. The Company posted an operating ratio (operating expenses as a percentage of operating revenues) of 84.9% and a 9.4% net margin (net income as a percentage of operating revenues) in the first quarter of 2015 compared to 90.8% and 6.3%, respectively in the first quarter of 2014.
Balance Sheet, Liquidity, and Capital Expenditures
At March 31, 2015, the Company had $52.2 million in cash balances and no borrowings under the Company's unsecured line of credit. The Company had $220.6 million in available borrowing capacity on the line of credit at March 31, 2015 after consideration of outstanding letters of credit. The Company is in compliance with associated financial covenants. The Company's debt balance decreased $24.6 million from December 31, 2014 due to repayments during the three months ended March 31, 2015. Since the high point of the Company's debt borrowings of $76.7 million in December of 2013, the Company has repaid the borrowings in full and returned to a balance sheet without long-term debt. The Company ended the quarter with total assets of $780.5 million.
The average age of the Company's tractor fleet was 1.7 years as of March 31, 2015 compared to 2.6 years at March 31, 2014. During the first quarter of 2015 the Company took delivery of approximately 250 new tractors and has approximately 1,300 new tractors scheduled for delivery prior to the end of the year. The new tractors have been and will continue to be a mix of International ProStar Plus and Freightliner Cascadia models in 2015. The average age of tractors is currently expected to decrease throughout the remainder of 2015. The average age of the Company's trailer fleet was 4.5 years at March 31, 2015 compared to 4.8 years at March 31, 2014. During the first quarter of 2015 the Company took delivery of 50 new trailers and has 450 new trailers scheduled for delivery prior to the end of 2015. The Company will continue to take advantage of a favorable used trailer market during the remainder of 2015. It is currently estimated that the Company's dry-van trailer fleet, excluding specialty equipment, will be 100% 2011 and newer model years by the end of 2015.
Net cash flows from operations for the first three months of 2015 was an all-time record high of 29.7% of operating revenues or $55.7 million. The primary use of cash during the three month period ended March 31, 2015 was $24.6 million for the repayment of long-term debt obligations. The Company currently anticipates a total of approximately $80 to $90 million in net capital expenditures for the calendar year. The Company ended the past twelve months with a return on total assets of 11.6% and a 19.0% return on equity.
The Company continues its commitment to stockholders through the payment of cash dividends. A dividend of $0.02 per share was declared during the quarter and was paid on April 2, 2015. The Company has now paid cumulative cash dividends of $452.2 million, including three special dividends, ($2.00 in 2007, $1.00 in 2010, and $1.00 in 2012) over the past forty-seven consecutive quarters. The Company has also repurchased approximately $80.5 million of common stock over the past five years.
We continued to deliver award-winning service and safety to our customers as evidenced by the following awards received during the quarter:
- Unilever - Excellence Award (2014)
- Winegard – Truckload Carrier of the Year (2014)
- Quaker/Gatorade - Carrier of the Year (Central Region - West, 2014)
- Quaker/Gatorade - Carrier of the Year (Northwest Region, 2014)
- Exel - Truckload EDI Compliance Award (2014)
- Eastman - Supplier Excellence Award (2014)
Other Information
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 | ||
| (In thousands, except per share amounts) | ||
| (unaudited) | ||
| Three Months Ended March 31, | ||
| 2015 | 2014 | |
| OPERATING REVENUE | $ 187,523 | $ 224,481 |
| OPERATING EXPENSES: | ||
| Salaries, wages, and benefits | $ 70,996 | $ 70,945 |
| Rent and purchased transportation | 9,327 | 14,510 |
| Fuel | 34,256 | 63,225 |
| Operations and maintenance | 8,134 | 10,121 |
| Operating taxes and licenses | 4,813 | 4,846 |
| Insurance and claims | 6,644 | 7,095 |
| Communications and utilities | 1,543 | 1,830 |
| Depreciation and amortization | 25,974 | 24,573 |
| Other operating expenses | 7,757 | 8,691 |
| Gain on disposal of property and equipment | (10,181) | (2,043) |
| 159,263 | 203,793 | |
| Operating income | 28,260 | 20,688 |
| Interest income | 31 | 36 |
| Interest expense | (19) | (155) |
| Income before income taxes | 28,272 | 20,569 |
| Federal and state income taxes | 10,661 | 6,490 |
| Net income | $ 17,611 | $ 14,079 |
| Earnings per share | ||
| Basic | $ 0.20 | $ 0.16 |
| Diluted | $ 0.20 | $ 0.16 |
| Weighted average shares outstanding | ||
| Basic | 87,791 | 87,704 |
| Diluted | 87,965 | 87,917 |
| Dividends declared per share | $ 0.02 | $ 0.02 |
| HEARTLAND EXPRESS, INC. | ||
| AND SUBSIDIARIES | ||
| CONDENSED CONSOLIDATED BALANCE SHEETS | ||
| (in thousands, except per share amounts) | ||
| (unaudited) | ||
| March 31, | December 31, | |
| ASSETS | 2015 | 2014 |
| CURRENT ASSETS | ||
| Cash and cash equivalents | $ 52,171 | $ 17,303 |
| Trade receivables, net | 73,744 | 77,034 |
| Prepaid tires | 9,424 | 10,160 |
| Prepaid shop supplies | 1,840 | 2,056 |
| Other current assets | 34,061 | 8,992 |
| Income tax receivable | 7,191 | 19,920 |
| Deferred income taxes, net | 16,855 | 14,767 |
| Total current assets | 195,286 | 150,232 |
| PROPERTY AND EQUIPMENT | 655,616 | 678,566 |
| Less accumulated depreciation | 197,306 | 198,007 |
| 458,310 | 480,559 | |
| GOODWILL | 100,212 | 100,212 |
| OTHER INTANGIBLES, NET | 15,754 | 16,380 |
| OTHER ASSETS | 10,953 | 12,611 |
| $ 780,515 | $ 759,994 | |
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||
| CURRENT LIABILITIES | ||
| Accounts payable and accrued liabilities | $ 33,918 | $ 8,261 |
| Compensation and benefits | 28,220 | 26,303 |
| Insurance accruals | 19,534 | 19,249 |
| Other accruals | 13,544 | 14,475 |
| Total current liabilities | 95,216 | 68,288 |
| LONG-TERM LIABILITIES | ||
| Income taxes payable | 17,257 | 18,296 |
| Long-term debt | — | 24,600 |
| Deferred income taxes, net | 102,169 | 101,605 |
| Insurance accruals less current portion | 60,729 | 59,300 |
| Other long-term liabilities | 12,418 | 11,318 |
| Total long-term liabilities | 192,573 | 215,119 |
| COMMITMENTS AND CONTINGENCIES | ||
| STOCKHOLDERS' EQUITY | ||
| Capital stock, common, $.01 par value; authorized 395,000 shares; issued 90,689 in 2015 and 2014; outstanding 87,791 in 2015 and 87,781 in 2014, respectively | 907 | 907 |
| Additional paid-in capital | 4,210 | 4,058 |
| Retained earnings | 525,686 | 509,834 |
| Treasury stock, at cost; 2,898 in 2015 and 2,908 in 2014, respectively | (38,077) | (38,212) |
| 492,726 | 476,587 | |
| $ 780,515 | $ 759,994 | |
Heartland Express, Inc. Mike Gerdin, Chief Executive Officer John Cosaert, Chief Financial Officer 319-626-3600
