NORTH LIBERTY, IOWA -- Heartland Express, Inc. (Nasdaq: HTLD) announced today financial results for the quarter and year ended December 31, 2007. Operating revenues for the quarter increased 4.1% to $152.8 million from $146.8 million in the fourth quarter of 2006. Net income decreased 15.4% to $16.6 million from $19.6 million in the 2006 period. Earnings per share were $0.17 compared to $0.20 for the fourth quarter of 2006. Operating income during the fourth quarter of 2007 was negatively impacted approximately $4.6 million or $0.03 per share due to an increase in fuel cost, net of fuel surcharge revenue.
For the year ended December 31, 2007, operating revenues increased 3.5% to $591.9 million from $571.9 million during the same period in 2006. Net income decreased 12.6% to $76.2 million from $87.2 million in the 2006 period. Earnings per share were $0.78 compared with $0.89 for the 2006 period. Operating income for the year was negatively impacted by a $8.0 million decrease in gains on disposal of property and equipment. In addition, operating income for the year ended December 31, 2007 was negatively impacted approximately $10.5 million or $0.07 per share due to an increase in fuel cost, net of fuel surcharge revenue.
For the quarter, Heartland Express, Inc. posted an operating ratio (operating expenses as a percentage of operating revenues) of 83.9% and a 10.9% net margin (net income as a percentage of operating revenues). The Company reported an operating ratio of 81.3% and a 12.9% net margin for the year ended December 31, 2007. The Company ended the year with cash, cash equivalents, and short-term investments of $196.6 million, a $134.7 million decrease from the $331.3 million reported on December 31, 2006 due to the special $196.5 million dividend paid in 2007. The Company’s balance sheet continues to be debt-free.
The average age of the Company’s tractor fleet was 2.1 years at December 31, 2007 with the entire tractor fleet consisting of 2005 or newer model year International tractors. The average age of the Company’s trailer fleet was 3.8 years at December 31, 2007 with 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 $1.9 million at the rate of $0.02 per share was paid on January 3, 2008 to shareholders of record at the close of business on December 21, 2007. The Company has now paid cash dividends of $224.6 million over the past eighteen consecutive quarters. Interest income decreased in the fourth quarter of 2007 and for the year ended December 31, 2007 primarily due to the payment of the special dividend.
The Company purchased 1.3 million shares of its outstanding common stock during the year. 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.
On October 11, 2007, Forbes magazine named Heartland Express one of the “Best 200 Small Companies in America.” The Company has been recognized sixteen times during its twenty one years as a public company, and has made the list the past six consecutive years.
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.