Heartland Express profit falls, beats analysts' forecast

Swings in diesel fuel expense hurting North Liberty-based company

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Higher fuel costs and a $4.1 million decrease in gains on disposal of property and equipment reduced the fourth-quarter and annual profit of Heartland Express, but the company still topped analysts' expectations.

The North Liberty-based company recorded fourth-quarter net income of $14.3 million, down 16.5 percent from $17.1 million in the final quarter of 2011. Earnings per share declined 14.4 percent to 17 cents per share from 20 cents per share reported in the fourth quarter of 2011.

Fourth-quarter operating revenue rose 3.8 percent to $136.2 million from $131.2 million in the fourth quarter of 2011.

Wall Street analysts were expecting the company to post earnings of 16 cents per share on operating revenue of $135.2 million.

For the year, net income dipped to $ 61.5 million from $ 69.9 million in 2011. Earnings per share slid to 72 cents per share in 2012 from 78 cents per share reported in 2011.

Operating revenue rose to $545.7 million in 2012 from $ 528.6 million the previous year.

Heartland Express said it continues to experience significant swings in diesel fuel expense from quarter to quarter.

Fuel expense increased $3.2 million, or 8.2 percent, during the fourth quarter of 2012 and $7.1 million, or 4.4 percent, during the year, primarily due to an increase in average fuel prices over the same periods of 2011.

The U.S. average cost of diesel fuel was $4.015 per gallon during the fourth quarter of 2012, a 3.7 percent increase over the fourth quarter of the prior year, and $3.971 for the year, a 3.2 percent increase from 2011.

Heartland Express said it continues to focus on diesel fuel surcharge pricing, truck idling hours, overall tractor fuel economy and fuel purchasing decisions in an effort to lessen the impact of higher prices at the pump.

With regard to upgrading its fleet of tractors and trailers, Heartland Express took delivery of 225 new trucks during the fourth quarter of 2012 and will receive an additional 675 new trucks throughout the first quarter of 2013. The company took delivery of 1,864 new trailers in 2012, including 890 during the fourth quarter, and sold 1,292 trailers during the year.

Heartland Express continues to maintain a debt-free balance sheet with total assets of $467.7 million.

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