Heartland Express, North Liberty, Iowa, reported revenues up 13 percent and net income up 44 percent for the fourth quarter of 2010 compared to a year earlier. For 2010, revenues and net income were both up about 9 percent from 2009.


Operating revenues for the quarter increased 13.2% to $129.2 million from $114.2 million in the fourth quarter of 2009. Net income was $15.4 million compared to $10.7 million in the 2009 period, a 43.9% increase. Earnings per share increased 41.7% to $0.17 from $0.12 reported in the fourth quarter of 2009.

Heartland reported an operating ratio (operating expenses as a percentage of operating revenues) of 81% and a 11.9% net margin (net income as a percentage of operating revenues) compared to 86.2% and 9.4%, respectively, in the fourth quarter of last year.

Operating revenues for the year increased 8.7% to $499.5 million from $459.5 million in the 2009 period. Net income was $62.2 million compared to $56.9 million in the 2009 period, a 9.2% increase. Earnings per share increased 11.3% to $0.69 from $0.62 reported in the year ended December 31, 2009.

The company notes that it accomplished this increase in earnings per share despite a decrease in gains on disposal of property and equipment and an increase in depreciation expense, which collectively reduced earnings per share by $0.07. These changes were primarily attributable to the purchase of new tractors during the latter half of 2009 and the third and fourth quarters of 2010. For the year, Heartland posted an operating ratio of 81.7% and a 12.5% net margin compared to 82.8% and 12.4%, respectively, reported last year.

Operating revenues continue to trend upward as a result of tighter industry capacity, the company says. However, freight volumes are "still moderate in this less-than-robust economy."

Heartland's release also noted that industry capacity will continue to be restrained by the shortage of qualified drivers, explaining that driver recruitment and retention are expected to be impacted by the stringent safety requirements of the CSA enforcement (Compliance Safety Accountability).

Heartland says by the end of the first quarter, it will complete the installation of PeopleNet electronic on-board recorders in all 2009 model and newer trucks, estimated to be approximately 95 percent of the fleet.

The average age of the company's tractor fleet was 1.8 years as of December 31, 2010, with 89.5% of the fleet being 2009 models and newer. The company completed the purchase and delivery of 200 new 2011 ProStar Internationals in the fourth quarter and will take delivery of 200 new 2012 ProStar Internationals in the first quarter of 2011.

The company began an upgrade of its trailer fleet during 2010. The first phase of this upgrade was the purchase of 600 new Great Dane trailers during the third and fourth quarters of 2010. This upgrade will continue throughout 2011 with purchases of new Great Dane and Wabash trailers.

Fuel expense increased $6.1 million or 21.6% during the fourth quarter, primarily due to an increase in average fuel prices. Heartland says it is aggressively managing truck idling hours and fuel purchasing decisions, and all 2009 and newer model trucks are more fuel efficient and equipped with idle management controls.