htld-20210930

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 September 30, 2021

[ ] 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 October 29, 2021 there were 78,904,751 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 September 30, 2021 and December 31, 2020 (unaudited)			4
Consolidated Statements of Comprehensive Income for the Three and Nine Months Ended September 30, 2021 and 2020 (unaudited)			5
Consolidated Statements of Stockholders' Equity for the Three and Nine Months Ended September 30, 2021 and 2020 (unaudited)			6
Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2021 and 2020 (unaudited)			7
Notes to Consolidated Financial Statements (unaudited)			8
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations			15
Item 3. Quantitative and Qualitative Disclosures about Market Risk			23
Item 4. Controls and Procedures			23

PART II - OTHER INFORMATION

Item 1. Legal Proceedings			25
Item 1A. Risk Factors			25
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds			26
Item 3. Defaults U pon 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	September 30, 2021		December 31, 2020
CURRENT ASSETS
Cash and cash equivalents	$	180,366	$	113,852
Trade receivables, net of $1.1 million allowance in 2021 and 2020, respectively	58,538		55,577
Prepaid tires	9,272		8,241
Other current assets	10,398		15,342
Total current assets	258,574		193,012
PROPERTY AND EQUIPMENT
Land and land improvements	83,698		77,525
Buildings	89,375		86,712
Furniture and fixtures	5,282		4,807
Shop and service equipment	14,404		14,380
Revenue equipment	518,505		590,153
Construction in progress	14,238		5,783
Property and equipment, gross	725,502		779,360
Less accumulated depreciation	234,444		240,080
Property and equipment, net	491,058		539,280
GOODWILL	168,295		168,295
OTHER INTANGIBLES, NET	22,953		24,746
DEFERRED INCOME TAXES, NET	—		8,164
OTHER ASSETS	17,400		17,679
	$	958,280	$	951,176
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable and accrued liabilities	$	14,430	$	12,751
Dividend payable	41,095		—
Compensation and benefits	24,355		22,422
Insurance accruals	13,645		15,837
Other accruals	19,001		18,557
Income tax payable	4,513		1,475
Total current liabilities	117,039		71,042
LONG-TERM LIABILITIES
Income taxes payable	5,385		5,801
Deferred income taxes, net	87,217		104,004
Insurance accruals less current portion	39,823		45,995
Total long-term liabilities	132,425		155,800
COMMITMENTS AND CONTINGENCIES (Note 13)
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 2021 and 2020; outstanding 78,943 and 80,653 in 2021 and 2020, respectively	907		907
Additional paid-in capital	4,319		4,330
Retained earnings	905,620		890,970
Treasury stock, at cost; 11,746 and 10,036 in 2021 and 2020, respectively	(202,030)		(171,873)
	708,816		724,334
	$	958,280	$	951,176

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 September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020

OPERATING REVENUE	$	152,612	$	162,282	$	459,142	$	489,473

OPERATING EXPENSES
Salaries, wages, and benefits	62,733		67,178		190,446		205,579
Rent and purchased transportation	950		999		2,922		3,635
Fuel	25,258		21,218		74,220		65,445
Operations and maintenance	5,372		7,118		16,729		21,516
Operating taxes and licenses	3,311		3,664		10,345		11,229
Insurance and claims	5,053		4,827		15,171		16,034
Communications and utilities	1,218		1,398		3,412		4,091
Depreciation and amortization	25,280		27,625		78,162		81,427
Other operating expenses	5,418		6,637		16,173		19,602
Gain on disposal of property and equipment	(15,254)		(5,721)		(27,341)		(8,739)
	119,339		134,943		380,239		419,819

Operating income	33,273		27,339		78,903		69,654

Interest income	181		171		493		704


Income before income taxes	33,454		27,510		79,396		70,358

Federal and state income taxes	8,988		6,796		20,454		17,224

Net income	$	24,466	$	20,714	$	58,942	$	53,134
Other comprehensive income, net of tax	—		—		—		—
Comprehensive income	$	24,466	$	20,714	$	58,942	$	53,134

Net income per share
Basic	$	0.31	$	0.25	$	0.74	$	0.65
Diluted	$	0.31	$	0.25	$	0.74	$	0.65

Weighted average shares outstanding
Basic	79,336		81,370		79,795		81,530
Diluted	79,364		81,404		79,839		81,587

Dividends declared per share	$	0.52	$	0.02	$	0.56	$	0.06

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, 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
Net income	—		—		24,466		—		24,466
Repurchases of common stock	—		—		—		(16,400)		(16,400)
Dividends on common stock, $0.52 per share	—		—		(41,095)		—		(41,095)
Stock-based compensation, net of tax	—		(212)		—		291		79
Balance, September 30, 2021	$	907	$	4,319	$	905,620	$	(202,030)	$	708,816

	Capital		Additional
	Stock,		Paid-In		Retained		Treasury
	Common		Capital		Earnings		Stock		Total
Balance, December 31, 2019	$	907	$	4,141	$	826,666	$	(147,055)	$	684,659
Net income	—		—		13,238		—		13,238
Dividends on common stock, $0.02 per share	—		—		(1,628)		—		(1,628)
Repurchases of common stock	—		—		—		(12,278)		(12,278)
Stock-based compensation, net of tax	—		291		—		406		697
Balance, March 31, 2020	907		4,432		838,276		(158,927)		684,688
Net income	—		—		19,182		—		19,182
Dividends on common stock, $0.02 per share	—		—		(1,628)		—		(1,628)
Stock-based compensation, net of tax	—		174		—		199		373
Balance, June 30, 2020	907		4,606		855,830		(158,728)		702,615
Net income	—		—		20,714		—		20,714
Dividends on common stock, $0.02 per share	—		—		(1,628)		—		(1,628)
Stock-based compensation, net of tax	—		(208)		—		216		8
Balance, September 30, 2020	$	907	$	4,398	$	874,916	$	(158,512)	$	721,709

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)
	Nine Months Ended September 30,
	2021		2020
OPERATING ACTIVITIES
Net income	$	58,942	$	53,134
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	78,286		81,786
Deferred income taxes	(8,623)		9,256
Stock-based compensation expense	959		1,509
Gain on disposal of property and equipment	(27,341)		(8,739)
Changes in certain working capital items:
Trade receivables	(2,961)		(5,785)
Prepaid expenses and other current assets	3,041		(6,645)
Accounts payable, accrued liabilities, and accrued expenses	(9,231)		5,101
Accrued income taxes	2,622		3,370
Net cash provided by operating activities	95,694		132,987
INVESTING ACTIVITIES
Proceeds from sale of property and equipment	98,421		51,473
Purchases of property and equipment	(93,213)		(163,824)

Change in other assets	(181)		72
Net cash provided by (used in) investing activities	5,027		(112,279)
FINANCING ACTIVITIES
Payment of cash dividends	(3,198)		(4,884)
Shares withheld for employee taxes related to stock-based compensation	(190)		(431)

Repurchases of common stock	(31,422)		(12,278)
Net cash used in financing activities	(34,810)		(17,593)
Net increase in cash, cash equivalents and restricted cash	65,911		3,115
CASH, CASH EQUIVALENTS AND RESTRICTED CASH
Beginning of period	131,140		96,076
End of period	$	197,051	$	99,191
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION

Cash paid during the period for income taxes, net of refunds	$	26,455	$	4,598
Noncash investing and financing activities:
Purchased property and equipment in accounts payable	$	3,258	$	12,114
Sold revenue equipment and property in other current assets	$	1,423	$	5,195
Common stock dividends declared in accounts payable	$	41,095	$	—
RECONCILIATION OF CASH, CASH EQUIVALENTS AND RESTRICTED CASH
Cash and cash equivalents	$

SEC Form 10-Q filed by Heartland Express, Inc.