Heartland Express, Inc. Reports Revenues and Earnings for the Fourth Quarter of 2003
CORALVILLE, Iowa--Jan. 2, 20043, 2004--Heartland Express, Inc. announced today financial results for the fourth quarter ended December 31, 2003. For the fourth quarter revenue increased 12.0% to $103.0 million from $92.0 million in the fourth quarter of 2002. Net income was $19.0 million and basic earnings per share were $0.38. The results reflect an adjustment pertaining to self insurance accruals. The impact of the reserve adjustment was an increase in net income of $5.4 million or $.11 per share. The reserve adjustment has no impact on cash flows. Heartland Express, Inc. posted an operating ratio (operating expenses as a percentage of gross revenues) of 72.1%. The reserve adjustment reduced the operating ratio from 80.1%.For the twelve months, revenue increased 18.9% to $405.1 million from $340.7 million during the same period in 2002. Net income for the twelve months was $57.2 million and basic earnings per share were $1.14.
During the fourth quarter Heartland Express, Inc. engaged consulting actuaries to assist in determining the liability for self insurance reserves. As a result of the actuarial studies management decreased the amount accrued for accident liability claims and increased the amount accrued for workers' compensation claims. This $5.4 million reserve adjustment, net of taxes, increased fourth quarter earnings by $0.11 per share. Details of the adjustment are as follows (in millions):
Decrease in insurance and claims expense $(11.2)
Increase in salaries, wages, benefits (workers' compensation) 2.9
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Increase in operating income 8.3
Income taxes (2.9)
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Increase in net income $ 5.4
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The Company ended the fourth quarter with cash, cash equivalents, and investments of $202.4 million, a $48.5 million increase from the $153.9 million reported on December 31, 2002. Total assets increased to $448.4 million from $373.1 million at December 31, 2002. The Company's balance sheet continues to be debt-free.
During the quarter, Heartland Express declared a regular quarterly cash dividend. The quarterly dividend of $1,000,000 at the rate of $0.02 per share was paid on January 2, 2004 to shareholders of record at the close of business on December 22, 2003.
This press release may contain statements that might be considered 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
Three months ended Twelve months ended
December 31, December 31,
2003 2002 2003 2002
---- ---- ---- ----
OPERATING
REVENUE $103,015,958 $91,991,577 $405,116,097 $340,745,026
------------ ----------- ------------ ------------
OPERATING
EXPENSES:
Salaries,
wages,
benefits $ 38,840,605 $31,028,763 $141,292,791 $109,959,772
Rent and
purchased
transportation 10,793,789 15,325,211 49,988,074 64,159,365
Operations and
maintenance 18,969,711 16,334,060 75,516,232 56,334,769
Taxes and
licenses 2,139,066 1,894,192 8,402,986 7,144,078
Insurance and
claims (7,732,134) 1,929,319 2,187,537 9,192,632
Communications
and utilities 841,447 716,308 3,604,661 2,956,810
Depreciation 7,100,937 6,350,883 26,533,937 20,378,720
Other operating
expenses 3,352,669 2,591,462 12,538,652 8,843,137
(Gain) on
disposal of
fixed assets (38,813) (422,012) (45,782) (273,549)
------------ ----------- ------------ ------------
$ 74,267,277 $75,748,186 $320,019,088 $278,695,734
------------ ----------- ------------ ------------
Operating
income $ 28,748,681 $16,243,391 $ 85,097,009 $ 62,049,292
Interest income 543,800 682,550 2,045,793 2,811,181
------------ ----------- ------------ ------------
Income before
income taxes $ 29,292,481 $16,925,941 $ 87,142,802 $ 64,860,473
Federal and
state income
taxes 10,252,369 5,754,818 29,921,477 22,052,559
------------ ----------- ------------ ------------
Net income $ 19,040,112 $11,171,123 $ 57,221,325 $ 42,807,914
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Earnings per
common share:
Basic
earnings per
share $ 0.38 $ 0.22 $ 1.14 $ 0.86
============ =========== ============ ============
Basic weighted
average shares
outstanding 50,000,000 50,000,000 50,000,000 50,000,000
============ =========== ============ ============
HEARTLAND EXPRESS, INC.
AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
ASSETS December 31, December 31,
2003 2002
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CURRENT ASSETS
Cash and short term investments $ 202,431,155 $ 153,861,422
Trade receivables 36,836,728 33,012,394
Prepaid tires 2,529,580 4,757,850
Deferred income taxes 21,308,000 21,134,000
Other current assets 673,101 620,344
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Total current assets $ 263,778,564 $ 213,386,010
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PROPERTY AND EQUIPMENT $ 232,650,992 $ 191,116,893
Less accumulated depreciation 56,951,186 39,715,307
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$ 175,699,806 $ 151,401,586
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OTHER ASSETS $ 8,928,186 $ 8,320,593
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$ 448,406,556 $ 373,108,189
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LIABILITIES AND STOCKHOLDERS'
EQUITY
CURRENT LIABILITIES
Accounts payable & accrued liabilities $ 15,684,826 $ 8,632,810
Accrued expenses 53,724,940 52,386,322
Income taxes payable 7,720,875 6,070,318
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Total current liabilities $ 77,130,641 $ 67,089,450
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DEFERRED INCOME TAXES $ 39,760,000 $ 30,089,000
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COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY
Capital stock: Common, $.01 par value;
authorized 395,000,000 shares; issued
and outstanding 50,000,000 $ 500,000 $ 500,000
Additional paid-in capital 8,510,305 8,603,762
Retained earnings 323,710,296 268,488,971
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$ 332,720,601 $ 277,592,733
Less unearned compensation (1,204,686) (1,662,994)
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$ 331,515,915 $ 275,929,739
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$ 448,406,556 $ 373,108,189
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