htld-20220630

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2022

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number 0-15087

HEARTLAND EXPRESS INC.

(Exact Name of Registrant as Specified in Its Charter)

Nevada

93-0926999

(State or Other Jurisdiction

(I.R.S. Employer

of Incorporation or organization)

Identification No.)

901 Heartland Way,

North Liberty,

Iowa

52317

(Address of Principal Executive Offices)

(Zip Code)

319-645-7060

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $0.01 par value	HTLD	NASDAQ

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.


Yes [X]			No [ ]

Indicate by check mark whether the registrant has submitted electronically, every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).


Yes [X]			No [ ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See definition of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act:


Large accelerated filer [X]						Accelerated filer [ ]
Non-accelerated filer [ ]						Smaller reporting company [ ]
						Emerging growth company [ ]

If an emerging company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [ ]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).


Yes [ ]			No [ X ]

As of August 1, 2022 there were 78,936,981 shares of the registrant’s common stock ($0.01 par value) outstanding.

HEARTLAND EXPRESS, INC.

AND SUBSIDIARIES

TABLE OF CONTENTS




			Page
PART I - FINANCIAL INFORMATION

Item 1. Financial Statements
Consolidated Balance Sheets as of June 30 , 2022 and December 31, 2021 (unaudited)			3
Consolidated Statements of Comprehensive Income for the Three and Six Mon ths Ended June 30 , 2022 and 2021 (unaudited)			4
Consolidated Statements of Stockholders' Equity for the Three and Six Months Ended June 30 , 2022 and 2021 (unaudited)			5
Consolidated Statements of Cash Flows for the Six Months Ended June 30 , 2022 and 2021 (unaudited)			6
Notes to Consolidated Financial Statements (unaudited)			7
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations			16
Item 3. Quantitative and Qualitative Disclosures about Market Risk			24
Item 4. Controls and Procedures			25

PART II - OTHER INFORMATION

Item 1. Legal Proceedings			26
Item 1A. Risk Factors			26
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds			26
Item 3. Defaults Upon Senior Securities			26
Item 4. Mine Safety Disclosures			26
Item 5. Other Information			26
Item 6. Exhibits			27

Signatures			28

PART I


HEARTLAND EXPRESS, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (in thousands, except per share amounts) (unaudited)
ASSETS	June 30, 2022		December 31, 2021
CURRENT ASSETS
Cash and cash equivalents	$	171,879	$	157,742
Trade receivables, net of $1.3 and $1.1 million allowance in 2022 and 2021, respectively	95,712		52,812
Prepaid tires	8,570		9,168
Other current assets	19,955		9,406
Income tax receivable	—		4,095
Total current assets	296,116		233,223
PROPERTY AND EQUIPMENT
Land and land improvements	71,458		90,218
Buildings	98,877		95,305
Furniture and fixtures	5,187		5,365
Shop and service equipment	16,737		15,727
Revenue equipment	548,541		500,311
Construction in progress	8,951		3,834
Property and equipment, gross	749,751		710,760
Less accumulated depreciation	238,944		222,845
Property and equipment, net	510,807		487,915
GOODWILL	208,800		168,295
OTHER INTANGIBLES, NET	49,230		22,355
OTHER ASSETS	19,454		16,754
OPERATING LEASE RIGHT OF USE ASSETS	28,796		—
	$	1,113,203	$	928,542
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable and accrued liabilities	$	28,804	$	20,538
Compensation and benefits	27,778		21,411
Insurance accruals	15,859		15,677
Long-term debt - current portion	2,304		—
Operating lease liabilities - current portion	14,318		—
Finance lease liabilities - current portion	7,544		—
Other accruals	16,410		13,968
Income tax payable	13,335		—
Total current liabilities	126,352		71,594
LONG-TERM LIABILITIES
Income taxes payable	6,461		5,491
Long-term debt less current portion	8,623		—
Operating lease liabilities less current portion	14,478		—
Finance lease liabilities less current portion	27,199		—
Deferred income taxes, net	77,262		89,971
Insurance accruals less current portion	34,926		34,384
Total long-term liabilities	168,949		129,846
COMMITMENTS AND CONTINGENCIES (Note 15)
STOCKHOLDERS' EQUITY
Preferred stock, par value $.01; authorized 5,000 shares; none issued	—		—
Capital stock, common, $.01 par value; authorized 395,000 shares; issued 90,689 in 2022 and 2021; outstanding 78,936 and 78,923 in 2022 and 2021, respectively	907		907
Additional paid-in capital	4,191		4,141
Retained earnings	1,014,898		924,375
Treasury stock, at cost; 11,753 and 11,766 in 2022 and 2021, respectively	(202,094)		(202,321)
	817,902		727,102
	$	1,113,203	$	928,542

The accompanying notes are an integral part of these consolidated financial statements.


HEARTLAND EXPRESS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(in thousands, except per share amounts)
(unaudited)
	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021

OPERATING REVENUE	$	187,821	$	154,128	$	339,097	$	306,530

OPERATING EXPENSES
Salaries, wages, and benefits	65,869		62,931		124,506		127,713
Rent and purchased transportation	3,127		1,009		3,874		1,973
Fuel	42,046		24,804		71,758		48,961
Operations and maintenance	6,066		5,670		11,146		11,358
Operating taxes and licenses	3,352		3,413		6,562		7,034
Insurance and claims	6,339		4,678		11,905		10,117
Communications and utilities	1,126		967		2,204		2,193
Depreciation and amortization	24,309		25,956		47,620		52,882
Other operating expenses	12,244		5,204		18,042		10,756
Gain on disposal of property and equipment	(81,712)		(7,855)		(85,970)		(12,088)
	82,766		126,777		211,647		260,899

Operating income	105,055		27,351		127,450		45,631

Interest income	260		175		406		312
Interest expense	(174)		—		(174)		—

Income before income taxes	105,141		27,526		127,682		45,943

Federal and state income taxes	28,235		6,784		34,001		11,466

Net income	$	76,906	$	20,742	$	93,681	$	34,477
Other comprehensive income, net of tax	—		—		—		—
Comprehensive income	$	76,906	$	20,742	$	93,681	$	34,477

Net income per share
Basic	$	0.97	$	0.26	$	1.19	$	0.43
Diluted	$	0.97	$	0.26	$	1.19	$	0.43

Weighted average shares outstanding
Basic	78,934		79,906		78,931		80,028
Diluted	78,959		79,957		78,956		80,081

Dividends declared per share	$	0.02	$	0.02	$	0.04	$	0.04

The accompanying notes are an integral part of these consolidated financial statements.


HEARTLAND EXPRESS, INC AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
(in thousands, except per share amounts)
(unaudited)

	Capital		Additional
	Stock,		Paid-In		Retained		Treasury
	Common		Capital		Earnings		Stock		Total
Balance, December 31, 2021	$	907	$	4,141	$	924,375	$	(202,321)	$	727,102
Net income	—		—		16,775		—		16,775
Dividends on common stock, $0.02 per share	—		—		(1,579)		—		(1,579)
Stock-based compensation, net of tax	—		64		—		166		230
Balance, March 31, 2022	907		4,205		939,571		(202,155)		742,528
Net income	—		—		76,906		—		76,906
Dividends on common stock, $0.02 per share	—		—		(1,579)		—		(1,579)
Stock-based compensation, net of tax	—		(14)		—		61		47
Balance, June 30, 2022	$	907	$	4,191	$	1,014,898	$	(202,094)	$	817,902






	Capital		Additional
	Stock,		Paid-In		Retained		Treasury
	Common		Capital		Earnings		Stock		Total
Balance, December 31, 2020	$	907	$	4,330	$	890,970	$	(171,873)	$	724,334
Net income	—		—		13,734		—		13,734
Dividends on common stock, $0.02 per share	—		—		(1,599)		—		(1,599)
Repurchases of common stock	—		—		—		(14,537)		(14,537)
Stock-based compensation, net of tax	—		146		—		339		485
Balance, March 31, 2021	907		4,476		903,105		(186,071)		722,417
Net income	—		—		20,742		—		20,742
Dividends on common stock, $0.02 per share	—		—		(1,598)		—		(1,598)
Stock-based compensation, net of tax	—		55		—		150		205
Balance, June 30, 2021	$	907	$	4,531	$	922,249	$	(185,921)	$	741,766

The accompanying notes are an integral part of these consolidated financial statements.


HEARTLAND EXPRESS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
	Six Months Ended June 30,
	2022		2021
OPERATING ACTIVITIES
Net income	$	93,681	$	34,477
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	47,620		52,977
Deferred income taxes	(12,709)		(5,369)
Stock-based compensation expense	343		800
Gain on disposal of property and equipment	(85,970)		(12,088)
Changes in certain working capital items:
Trade receivables	(10,600)		(3,713)
Prepaid expenses and other current assets	(778)		2,073
Accounts payable, accrued liabilities, and accrued expenses	8,521		(5,502)
Accrued income taxes	18,400		(880)
Net cash provided by operating activities	58,508		62,775
INVESTING ACTIVITIES
Proceeds from sale of property and equipment	129,820		56,030
Purchases of property and equipment	(50,563)		(47,585)
Acquisition of business, net of cash acquired	(122,049)		—
Change in other assets	(9)		(174)
Net cash provided by (used in) investing activities	(42,801)		8,271
FINANCING ACTIVITIES
Payment of cash dividends	(1,579)		(3,198)
Shares withheld for employee taxes related to stock-based compensation	(66)		(110)
Repayments on finance leases and debt	(1,113)		—
Repurchases of common stock	—		(15,022)
Net cash used in financing activities	(2,758)		(18,330)
Net increase in cash, cash equivalents and restricted cash	12,949		52,716
CASH, CASH EQUIVALENTS AND RESTRICTED CASH
Beginning of period	173,767		131,140
End of period	$	186,716	$	183,856
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Cash paid during the period for interest expense	$	159	$	—
Cash paid during the period for income taxes, net of refunds