Heartland Express, Inc. Reports Revenues and Earnings for the Second Quarter of 2008

NORTH LIBERTY, Iowa--(Business Wire)--
Heartland Express, Inc. (Nasdaq: HTLD) announced today financial
results for the quarter and six months ended June 30, 2008. Operating
revenues for the quarter increased 10.4% to $164.6 million from $149.1
million in the second quarter of 2007. Net income decreased 13.2% to
$17.2 million from $19.8 million in the 2007 period. Earnings per
share were $0.18 compared to $0.20 for the second quarter of 2007. The
driving components of the decrease in net income and earnings per
share during the second quarter were the continued historical highs in
fuel prices and decreases in gains on sales of property and equipment
offset by a favorable tax expense adjustment related to the
application of Financial Accounting Standards Board ("FASB")
Interpretation No. 48 ("FIN 48"). Operating income for the quarter was
negatively impacted approximately $4.3 million or $0.03 per share due
to increased fuel expenditures, net of fuel surcharge revenue passed
through to customers and approximately $4.1 million or $0.03 per share
due to a reduction in gains on disposal of property and equipment. Net
income for the quarter was positively impacted approximately $1.8
million, as a reduction of income tax expense, or $0.02 per share due
to FIN 48.

For the six months ended June 30, 2008, operating revenues
increased 7.2% to $313.6 from $292.5 million during the same period in
2007. Net income decreased 24.8% to $31.9 million for the six month
period ended June 30, 2008 from $42.4 million in the 2007 period.
Earnings per share were $0.33 in 2008 compared to $0.43 in 2007 for
the six month period. Operating income for the six months was
negatively impacted approximately $9.3 million or $0.07 per share due
to increased fuel expenditures, net of fuel surcharge revenue passed
through to customers and approximately $9.1 million or $0.07 per share
due to a reduction in gains on sales of property and equipment. Net
income for the six month period was positively impacted approximately
$2.3 million, as a reduction of income tax expense, or $0.02 per share
due to FIN 48.

The Company experienced a 60.8% increase in average fuel costs per
gallon in the second quarter of 2008 compared to the second quarter of
2007. The average cost of fuel during the quarter ended June 30, 2008
was $4.21 compared to $2.62 in the second quarter of 2007. The Company
experienced a 51.9% increase in average fuel costs per gallon in the
six month period ended June 30, 2008 compared to the same six month
period of 2007. The average cost of fuel during the six month period
ended June 30, 2008 was $3.80 compared to $2.50 in the six month
period of 2007. The Company continues to stress its fuel cost
controlling initiatives. Such initiatives include the continued
purchasing of fuel in bulk for terminal locations and taking advantage
of bulk purchases where it is cost effective to do so when compared to
over-the-road purchases, reductions in tractor idle time and
controlling out-of-route non-billable miles. All of the Company's
eleven terminal locations have fueling capabilities.

For the quarter, Heartland Express, Inc. posted an operating ratio
(operating expenses as a percentage of operating revenues) of 87.3%
and a 10.5% net margin (net income as a percentage of operating
revenues) compared to 81.2% and 13.3% for the same period of 2007. The
Company reported an operating ratio of 87.0% and a 10.2% net margin
for the six months ended June 30, 2008 compared to 79.7% and 14.5% for
the same period of 2007. The increases in operating ratios for the
current quarter and six month period were attributable to the increase
in fuel costs and lower amounts of gains on disposals of property and
equipment as described above. The Company ended the second quarter
with cash, cash equivalents, short-term and long-term investments of
$215.2 million, a $20.3 million increase from the $194.9 million
reported on December 31, 2007. The Company's balance sheet continues
to be debt-free.

As of June 30, 2008, the majority of the Company's $187.0 million
long-term investments continue to be invested in auction rate student
loan educational bonds backed by the U.S. government and continued to
be associated with unsuccessful auctions. The majority (96.5%) of the
underlying investments continue to hold AAA (or equivalent) ratings
from recognized rating agencies. Management continues to believe that
current amounts of cash and cash equivalents along with cash flows
from operations are sufficient to meet the Company's cash flow
requirements and therefore has chosen to hold such investments until
successful auctions resume or the investments are called by the issuer
rather than selling the securities at discounted pricing. The
Company's average rate of return on these investments continues to
exceed the current rates of return on other AAA rated, short-term, tax
free security investment options. There were not any significant
changes in fair market value during the quarter ended June 30, 2008.

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 July 2, 2008 to shareholders
of record at the close of business on June 20, 2008. The Company has
now paid cash dividends of $228.4 million over the past twenty
consecutive quarters which includes the special dividend of $2.00 per
share during the second quarter of 2007. Interest income decreased in
the six month period of 2008 compared to the same period in 2007
primarily due to a decrease in average investments balance as a result
of the payment of the special dividend in May 2007 of approximately
$196.5 million which was primarily funded with the sale of
investments.

The Company anticipates beginning a tractor fleet upgrade in the
third quarter. The upgrade is expected to include the purchase of
approximately 1,600 International ProStar tractors. Delivery of
tractors is scheduled to begin during the third quarter of 2008 and
will continue through 2009. The Company will also take delivery of 400
2009 Wabash trailers during the second half of 2008. Management
believes the Company has adequate liquidity to meet these capital
requirements through cash generated through operations and existing
cash and cash equivalents.

The Company has recently been awarded five service awards in
addition to the six service awards announced during the first quarter
of 2008. These awards evidence the Company's continued ability to
deliver the highest quality of service to the Company's customers.
Such second quarter awards include 2007 National Carrier of the Year
and Platinum Award for Federal Express, Kimberly Clark Carrier of the
Year for 2007, Whirlpool Truckload Supplier of the Year for 2007, and
General Mills Dry National Carrier of the Year for fiscal 2008. The
award received from Kimberly Clark was the first award of its kind
distributed by Kimberly Clark and the Company was honored and
extremely proud to be the recipient of this inaugural 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.

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HEARTLAND EXPRESS, INC.
AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share amounts)

Three months ended Six months ended
June 30, June 30,
2008 2007 2008 2007
--------- --------- --------- ---------
(unaudited) (unaudited)
OPERATING REVENUE $164,592 $149,103 $313,641 $292,532
--------- --------- --------- ---------

OPERATING EXPENSES:

Salaries, wages, benefits $48,591 $50,951 $97,183 $98,964

Rent and purchased
transportation 5,144 5,643 10,250 10,865

Fuel 60,495 39,697 110,993 76,510

Operations and maintenance 4,353 3,499 8,316 6,703

Operating taxes and licenses 2,343 2,338 4,585 4,619

Insurance and claims 7,012 5,688 10,795 11,278

Communications and utilities 931 1,013 1,936 1,869

Depreciation 10,663 11,877 21,076 23,581

Other operating expenses 4,139 4,439 8,471 8,564

Loss (gain) on disposal of
property & equipment 11 (4,112) (633) (9,778)
--------- --------- --------- ---------

143,682 121,033 272,972 233,175
--------- --------- --------- ---------

Operating income 20,910 28,070 40,669 59,357

Interest income 2,236 2,906 5,099 6,222
--------- --------- --------- ---------

Income before income taxes 23,146 30,976 45,768 65,579

Federal and state income taxes 5,915 11,135 13,874 23,185
--------- --------- --------- ---------

Net income $17,231 $19,841 $31,894 42,394
========= ========= ========= =========

Earnings per share $0.18 $0.20 $0.33 $0.43
========= ========= ========= =========

Weighted average shares
outstanding 96,158 98,252 96,186 98,252
========= ========= ========= =========

Dividends declared per share $0.02 $2.02 $0.04 $2.04
========= ========= ========= =========
*T

HEARTLAND EXPRESS, INC.

AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except per share amounts)

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*T

June 30, December 31,
ASSETS 2008 2007
------------ ------------
(unaudited)
CURRENT ASSETS
Cash and cash equivalents $ 27,753 $ 7,960
Short-term investments 460 186,944
Trade receivables, net 53,036 44,359
Prepaid tires 4,760 4,764
Other current assets 5,976 3,391
Income tax receivable - 57
Deferred income taxes 32,578 30,443
------------ -----------
Total current assets 124,563 277,918
------------ -----------

PROPERTY AND EQUIPMENT 367,552 370,358
Less accumulated depreciation 151,454 132,545
------------ -----------
216,098 237,813
LONG-TERM INVESTMENTS 187,014 -
OTHER ASSETS 10,491 10,563
------------ -----------
$538,166 $526,294
============ ===========

LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES
Accounts payable & accrued liabilities $ 14,866 $ 13,073
Compensation & benefits 15,449 14,699
Income taxes payable 1,136 -
Insurance accruals 65,308 60,882
Other accruals 7,916 6,718
------------ -----------
Total current liabilities 104,675 95,372
------------ -----------

LONG-TERM LIABILITIES
Income taxes payable 34,130 37,593
Deferred income taxes 49,335 50,570
------------ -----------
83,465 88,163
------------ -----------
COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS' EQUITY
Preferred stock, $0.01 par value;
authorized
5,000 shares, none issued - -
Capital stock: common, $0.01 par value;
authorized 395,000 shares; issued and
outstanding 96,158 in 2008, 96,949 in
2007 962 970
Additional paid-in capital 439 439
Accumulated other comprehensive loss (10,159) -
Retained earnings 358,784 341,350
------------ -----------
350,026 342,759
------------ -----------
$538,166 $526,294
============ ===========
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Heartland Express, Inc.
Mike Gerdin, 319-626-3600
President
or
John Cosaert, 319-626-3600
Chief Financial Officer

Copyright Business Wire 2008