Forward Looking Statements

Except for certain historical information contained herein, this Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve risks, assumptions and uncertainties which are difficult to predict. All statements, other than statements of historical fact, are statements that could be deemed forward-looking statements, including any projections of earnings, revenues, or other financial items; any statements of plans, strategies, and objectives of management for future operations; any statements concerning proposed new strategies or developments; any statements regarding future economic conditions or performance; any statements of belief and any statement of assumptions underlying any of the foregoing. Words such as "believe," "may," "could," "expects," "anticipates," and "likely," and variations of these words or similar expressions, are intended to identify such forward-looking statements. The Company's actual results could differ materially from those discussed in the section entitled "Factors That May Affect Future Results," included in "Management's Discussion and Analysis of Financial Condition and Results of Operations" set forth in the Company's Annual report on Form 10-K, which is by this reference incorporated herein. The Company does not assume, and specifically disclaims, any obligation to update any forward-looking statements contained in this Quarterly report.

Overview

Heartland Express, Inc. is a short-to-medium haul truckload carrier. The Company transports freight for major shippers and generally earns revenue based on the number of miles per load delivered. The Company operated eleven regional operating divisions that provided regional dry van truckload services from nine regional operating centers in addition to its corporate headquarters during the quarter ended March 31, 2009. The Company's eleven regional operating divisions, not including operations at the corporate headquarters, accounted for 73.2% and 73.7% of the 2009 and 2008 operating revenues for the respective periods ended March 31. The Company's newest regional operating center near Dallas, Texas opened in early January 2009. The Company takes pride in the quality of the service that it provides to its customers. The keys to maintaining a high level of service are the availability of late-model equipment and experienced drivers.

Operating efficiencies and cost controls are achieved through equipment utilization, operating a fleet of late model equipment, maintaining an industry leading driver to non-driver employee ratio, and the effective management of fixed and variable operating costs. Fuel prices soared to historical highs during July 2008 and declined through December 31, 2008 and remained relatively stable throughout the quarter ended March 31, 2009. The industry experienced soft freight demand throughout 2008 which created downward pressures on freight rates, in combination with the decline in fuel surcharge revenue, which were lower during the first quarter of 2009. The industry continues to fight excess capacity in the market place along with declining freight volumes due to the current economic downturn. During 2008 the Company undertook fuel initiative strategies to effectively manage fuel costs. These initiatives included encouraging fueling at terminal locations rather than over-the-road purchases to take advantage of bulk fuel purchases when cost effective to do so, reduction of tractor idle time, and controlling out-of-route miles. Fuel expense was reduced approximately $26.0 million for the current quarter compared to the same quarter of prior year mainly due to reduced price of fuel and volumes due to lower miles driven as well as fuel cost savings initiatives previously mentioned. At March 31, 2009, the Company's tractor fleet had an average age of 2.5 years while the trailer fleet had an average age of 4.9 years. The Company continues to focus on growing internally by providing quality service to targeted customers with a high density of freight in the Company's regional operating areas. In addition to the development of its regional operating centers, the Company has made five acquisitions since 1987. Future growth is dependent upon several factors including the level of economic growth and the related customer demand, the available capacity in the trucking industry, potential acquisition opportunities, and the availability of experienced drivers.

The Company ended the first quarter of 2009 with operating revenues of $115.0 million, including fuel surcharges, net income of $14.1 million, and earnings per share of $0.15 on average outstanding shares of 92.5 million. The Company posted an 83.4% operating ratio (operating expenses as a percentage of operating

revenues) and a 12.3% net margin (net income as a percentage of operating revenues). The Company ended the quarter with cash, cash equivalents, short-term and long-term investments of $216.2 million and a debt-free balance sheet. The Company had total assets of $535.0 million at March 31, 2009. The Company achieved a return on assets of 13.1% and a return on equity of 21.0% for the twelve months ended March 31, 2009, compared to the twelve months ended March 31, 2008 which were 11.1% and 16.2%, respectively. The Company's cash flow from operations for the first three months of 2009 of $31.5 million represented a 2.7% increase from the same period of 2008 mainly due to a slight decrease in net income adjusted for gains on disposal of property and equipment and increased cash flows from working capital items which were attributable to trade receivable cash collections and timing of certain prepaid expense items. The Company's cash flow from operations was 27.4% of operating revenues for the quarter ended March 31, 2008 compared to 20.6% for the same period in 2008.

Results of Operations:

The following  table sets forth the percentage  relationship of expense items to
operating revenue for the periods indicated.


                                                Three Months Ended
                                                     March 31,
                                                  2009      2008
                                                 ------    ------
Operating revenue ..........................     100.0%    100.0%
                                                 ------    ------
Operating expenses:
  Salaries, wages, and benefits ............      38.3%     32.6%
  Rent and purchased transportation ........       2.6       3.4
  Fuel .....................................      21.4      33.9
  Operations and maintenance ...............       3.5       2.7
  Operating taxes and licenses .............       2.0       1.5
  Insurance and claims .....................       3.1       2.5
  Communications and utilities .............       0.9       0.7
  Depreciation .............................      10.3       7.0
  Other operating expenses .................       3.0       2.9
  Gain on disposal of property and equipment      (1.4)     (0.4)
                                                 ------    ------
  Total operating expenses .................      83.4%     86.7%
                                                 ------    ------
                  Operating income .........      16.6%     13.3%
Interest income ............................       0.8       1.9
                                                 ------    ------
         Income before income taxes ........      17.3%     15.2%
Federal and state income taxes .............       5.0       5.3
                                                 ------    ------
         Net income ........................      12.3%      9.8%
                                                 ======    ======

The following is a discussion of the results of operations of the three month period ended March 31, 2009 compared with the same period in 2008.

Three Months Ended March 2009 and 2008

Operating revenue decreased $34.0 million (22.8%), to $115.0 million in the first quarter of 2009 from $149.0 million in the first quarter of 2008. The decrease in operating revenue resulted from a decrease in fuel surcharge revenue of $16.4 million to $11.4 million, as a direct result in decreased fuel costs, and a decrease in line haul revenue of approximately $17.6 million mainly due to a reduction in fleet miles as a direct result of an overall decline in market demand for freight. The reduction in fuel surcharge revenue from $27.8 million in the first quarter of 2008 was the result of decreases in the national average fuel prices for the two comparative periods, $12.5 million, and further by reduced miles, $3.9 million.

Salaries, wages, and benefits decreased $4.5 million (9.3%), to $44.1 million in the first quarter of 2009 from $48.6 million in the first quarter of 2008. The decrease in salaries, wages and benefits was the net result of a decrease of approximately $4.5 million of company driver wages and $0.7 decrease in non-driver payroll and benefits, offset with an increase in workers' compensation of $0.7 million. Driver wages decreased $4.5 million, (12.6%) due to a decrease in total fleet miles as a direct result of an overall decline in

market demand for freight. The mix of the number of employee drivers to independent contractors increased from a mix of 95% company drivers and 5% independent contracts during the first quarter of 2008 to 96% company drivers and 4% independent contractors during 2009. The increase in workers' compensation expense of $0.7 million to $2.8 million in the quarter ended March 31, 2009 from $2.1 million in for the same period in 2008 was due to an increase in frequency and severity of claims. Non-driver payroll and benefits mainly decreased due to lower health insurance expense of $1.3 million in 2009 compared to $1.8 million in 2008. This decrease was mainly due to the decrease in frequency and severity of claims.

Rent and purchased transportation decreased $2.2 million (42.5%), to $2.9 million in the first quarter of 2009 from $5.1 million in the first quarter of 2008. Rent and purchased transportation for both periods includes amounts paid to independent contractors under the Company's fuel stability program. Purchased transportation decreased approximately $0.9 million during the quarter ended March 31, 2009 compared to the quarter ended March 31, 2008 due to a decrease in the Company's fuel stability program. Further reducing purchased transportation was a reduction in miles driven, $1.0 million (29.6%). Other rent expenses decreased approximately $0.3 million during the quarter ended March 31, 2009 compared to the quarter ended March 31, 2008 as a result of other rentals driven mainly by the decreased volume of business.

Fuel decreased $25.9 million (51.4%), to $24.6 million for the three months ended March 31, 2009 from $50.5 million for the same period of 2008. The decrease is the result of decreased fuel prices and decreased miles driven combined with an increase in fuel efficiency of our revenue equipment due to our initiatives to reduce fuel consumed in idle time and out of route trips. The Company's fuel cost per company-owned tractor mile decreased 44.1% in first quarter of 2009 compared to 2008. The national average of fuel costs per the U.S. Department of Energy was a reduction of 38.2% comparing the same two periods. The Company's first quarter fuel cost per gallon decreased by 41.8% in 2009 compared to 2008. Fuel cost per mile, net of fuel surcharge, decreased 35.1% in the first quarter of 2009 compared to 2008.

Operations and maintenance, operating taxes and licenses, insurance and claims, and communications and utilities remained mostly unchanged at a collective $10.8 million compared to $11.0 million for the same period of 2008.

Depreciation increased $1.4 million (13.5%), to $11.8 million during the first quarter of 2009 from $10.4 million in the first quarter of 2008. The increase is mainly attributable to an increase in tractor purchases for the twelve month periods leading up to and including the quarter ends March 31, 2009 and 2008. As tractors purchased prior to 2009 are depreciated using the 125% declining balance method, depreciation expense in years subsequent to the first year after initial purchase decline. Tractors purchased subsequent to January 1, 2009 are being depreciated using the 150% declining balance method, although, tractors purchased and placed in service during the quarter ended March 31, 2009 did not significantly affect depreciation expense for the quarter ended March 31, 2009. Tractor depreciation increased $1.5 million to $8.4 million in the quarter ended March 31, 2009 from $6.9 million in the quarter ended March 31, 2008. During the second half of 2008 and the 1st quarter of 2009 the Company has placed in service 620 new tractors which have a higher base cost than previous tractors purchased and are in the first year of depreciation. All other depreciation decreased $0.1 million mainly attributable to trailers becoming fully depreciated based on the aging of the trailer fleet.

Other operating expenses decreased $0.9 million (21.4%), to $3.4 million in the first quarter of 2009 from $4.3 million in the first quarter of 2008. Other operating expenses consists of costs incurred for advertising expense, freight handling, highway tolls, driver recruiting expenses, and administrative costs. The decrease of $0.7 million was mainly due to decreases of highway tolls, advertising and freight handling charges due to lower volumes of business and miles driven.

Gain on the disposal of property and equipment increased $1.0 million (159%), to $1.7 million during the first quarter of 2009 from $0.6 million in the first quarter of 2008. The increase in gains during the first quarter of 2009 compared to the first quarter of 2008 was directly attributable to the increase in sales/trades of revenue equipment during 2009 related to the Company's current fleet upgrade program. The Company was not performing any fleet upgrade during the first quarter of 2008.

Interest income decreased $2.0 million (69.6%), to $0.9 million in the first quarter of 2009 from $2.9 million in the same period of 2008. The decrease is mainly the result of lower average returns due to the decline in interest rates applicable to short and long-term investments which the Company saw throughout 2008, and continued into 2009.

The Company's effective tax rate was 29.0% and 35.2%, respectively, in the first quarter of 2009 and 2008. The decrease in the effective tax rate was due to a favorable income tax expense adjustment as a result of the application of FIN 48 and certain state tax benefits upon filing the 2008 state tax returns. Under the application of FIN 48, the Company reduced its liability in the three months ended March 31, 2009, for unrecognized tax benefits related to risks associated with state income tax filing positions for the Company's corporate subsidiaries mainly due to the expiration of certain statutes of limitations.

As a result of the foregoing, the Company's operating ratio (operating expenses as a percentage of operating revenue) was 83.4% during the first quarter of 2009 compared with 86.7% during the first quarter of 2008. Net income decreased $0.5 million (3.6%), to $14.1 million during the first quarter of 2009 from $14.7 million during the first quarter of 2008.

Liquidity and Capital Resources

The growth of the Company's business requires significant investments in new revenue equipment. Historically the Company has been debt-free, funding revenue equipment purchases with cash flow provided by operations, which was the case during 2008 with the 575 new tractors and 400 new trailers that were acquired. The Company also obtains tractor capacity by utilizing independent contractors, who provide a tractor and bear all associated operating and financing expenses. The Company's primary source of liquidity for the period ended March 31, 2009, was net cash provided by operating activities of $31.5 million compared to $30.7 million in 2008 due primarily to net income (excluding non-cash depreciation, deferred tax, and gains on disposal of equipment) being approximately $0.3 million lower in 2009 compared to 2008 offset with an increase in operating cash flow generated by operating assets and liabilities of approximately $1.1 million. The net increase in cash provided by operating assets and liabilities for the first quarter of 2009 compared to the same period of 2008 was primarily the result of reductions in accounts receivable balances due to collections, increases in accident and workers compensation insurance accruals and accounts payable, offset by reductions in accrued income taxes mainly due to uncertain tax position accrual changes and certain net income taxes paid during the quarter. Cash flow from operating activities was 27.4% of operating revenues in 2009 compared with 20.6% in 2008.

Capital expenditures for property and equipment, net of trade-ins, totaled $2.5 million for the first quarter of 2009 compared to $0.1 million during the same quarter of 2008. Cash flows during the first quarter of 2009 were mainly attributable to the Company's tractor fleet upgrade program. There were not any significant capital expenditures during the first quarter of 2008. The Company received $1.7 million in cash during the first quarter of 2009 related to a partial call of an ARS compared to $12.0 million net investment in ARS's prior to auction failures in February 2008. The increase in proceeds from sale of property and equipment was directly related to cash received under the Company's tractor fleet upgrade program.

The Company did not pay any dividends during the first quarter of 2009 compared to cash dividends of $1.9 million paid in quarter ended March 31, 2008. The dividend declared in the fourth quarter 2008 was paid in the fourth quarter of 2008. The Company declared a $1.8 million cash dividend in March 2009, included in accounts payable and accrued liabilities at March 31, 2009, which was paid on April 2, 2009.

In September, 2001, the Board of Directors of the Company authorized a program to repurchase 15.4 million shares, adjusted for stock splits, of the Company's Common Stock in open market or negotiated transactions using available cash and cash equivalents. The authorization to repurchase remains open at March 31, 2009 and has no expiration date. During the quarter ended March 31, 2009, approximately 3.5 million shares of the Company's common stock were repurchased for approximately $45.4 million at approximately $12.81 per share. The repurchased shares were subsequently retired. There were approximately 0.8 million shares repurchased for $10.6 million at approximately $13.40 per share during the first quarter of 2008. At March 31, 2009, the Company has approximately 6.5 million shares remaining under the current Board of Director repurchase authorization. Future purchases are dependent upon market conditions.

The Company paid income taxes, net, of $0.8 million in 2009 which was slightly lower than income taxes paid during the same period in 2008 of $0.9 million.

Management believes the Company has adequate liquidity to meet its current and projected needs. Management believes the Company will continue to have

significant capital requirements over the long-term which are expected to be funded from cash flows provided by operations and from existing cash, cash equivalents and investments. The Company's balance sheet remains debt free. The Company ended the quarter with $216.2 million in cash, cash equivalents and investments a decrease of $11.8 million from December 31, 2008. This decrease was mainly driven by stock repurchases, net of cash flows provided by operating activities.

The Company's investments are primarily in the form of tax free, auction rate student loan educational bonds backed by the U.S. government and are classified as available-for-sale. As of March 31, 2009 and December 31, 2008, all of the Company's long-term investment balance was invested in auction rate student loan educational bonds. The investments typically have an interest reset provision of 35 days with contractual maturities that range from 6 to 39 years as of March 31, 2009. At the reset date the Company has the option to roll the investments and reset the interest rate or sell the investments in an auction. The Company receives the par value of the investment plus accrued interest on the reset date if the underlying investment is sold. The majority, (approximately 97% at par) of the underlying investments is backed by the U.S. government. The remaining 3% of the student loan auction rate securities portfolio are insurance backed securities. As of March 31, 2009, approximately 93% of the underlying investments of the total portfolio held AAA (or equivalent) ratings from recognized rating agencies. Of the remaining 7% with less than AAA (or equivalent ratings), the Company received a partial call, at par, on May 1, 2009 which reduced the amount of holdings with credit ratings less than AAA (or equivalent ratings) to approximately 5% of the Company's portfolio at par.

As of March 31, 2009, all of the Company's auction rate student loan bonds were associated with unsuccessful auctions. To date, there have been no instances of delinquencies or non-payment of applicable interest from the issuers and all partial calls of securities by the issuers have been at par value plus accrued interest. Investment income received is generally exempt from federal income taxes and is accrued as earned. Accrued interest income is included in other current assets in the consolidated balance sheet.

The Company estimates the fair value of the auction rate securities applying the guidance in SFAS No. 157 ("SFAS 157"). Fair value represents an estimate of what the Company could sell the investments for in an orderly transaction with a third party as of the March 31, 2009 measurement date although it is not the intent of the Company to sell such securities at discounted pricing. Historically, the fair value of such investments was reported based on amortized cost. Until auction failures began, the fair value of these investments were calculated using Level 1 observable inputs per SFAS 157 and fair value was deemed to be equivalent to amortized cost due to the short-term and regularly occurring auction process. Based on auction failures beginning in mid-February 2008 and continued failures through March 31, 2009, there were not any observable quoted prices or other relevant inputs for identical or similar securities. Estimated fair value of all auction rate security investments as of March 31, 2009 was calculated using unobservable, Level 3 inputs, as defined by SFAS 157 due to the lack of observable market inputs specifically related to student loan auction rate securities. The fair value of these investments as of the March 31, 2009 measurement date could not be determined with precision based on lack of observable market data and could significantly change in future measurement periods.

The estimated fair value of the underlying investments as of March 31, 2009 declined below amortized cost of the investments, as a result of liquidity issues in the auction rate markets. With the assistance of the Company's financial advisors, fair values of the student loan auction rate securities were estimated, on an individual investment basis, using a discounted cash flow approach to value the underlying collateral of the trust issuing the debt securities considering an anticipated estimated outstanding average life of the underlying student loans (range of two to ten years) that are the collateral to the trusts, principal outstanding, expected rates of returns, and payout formulas. These underlying cash flows, by individual investment, were discounted using interest rates consistent with instruments of similar quality and duration with an adjustment for a higher required yield for lack of liquidity in the market for these auction rate securities (range of 2.6%-11.0%). The Company obtained an understanding of assumptions in models used by third party financial institutions to estimate fair value and considered these assumptions in the Company's cash flow models but did not exclusively use the fair values provided by financial institutions based on their internal modeling. The Company is aware that trading of student loan auction rate securities is occurring in secondary markets, which were considered in the Company's fair value assessment, although the Company has not listed any of its assets for sale on the secondary market. As a result of the fair value measurements, there were no changes to the unrealized loss and reduction to investments, of $8.6 million, net of tax, during period ended March 31, 2009. The unrealized loss of $8.6 million, net of tax, is recorded as an adjustment to accumulated other comprehensive loss. There were not any realized gains or losses related to these investments for the period ended March 31, 2009.

During the third and fourth quarters of 2008, various financial institutions and respective regulatory authorities announced proposed settlement terms in response to various regulatory authorities alleging certain financial institutions misled investors regarding the liquidity risks associated with auction rate securities that the respective financial institutions underwrote, marketed and sold. Further the respective regulatory authorities alleged the respective financial institutions misrepresented to customers that auction rate securities were safe, highly liquid investments that were comparable to money markets. Certain settlement agreements were finalized prior to December 31, 2008. Approximately 97% (at par value) of our auction rate security investments were not covered by the terms of the above mentioned settlement agreements. The focus of the initial settlements was generally towards individuals, charities, and businesses with small investment balances, generally with holdings of $25 million and less. As part of the general terms of the settlements, the respective financial institutions have agreed to provide their best efforts in providing liquidity to the auction rate securities market for investors not specifically covered by the terms of the respective settlements. Such liquidity solutions could be in the form of facilitating issuer redemptions, resecuritizations, or other means. The Company can not currently project when liquidity will be obtained from these investments, and plans to continue to hold such securities until the securities are called, redeemed, or resecuritized by the debt issuers.

The remaining 3.0% (at par value) was specifically covered by a settlement agreement which the Company signed during the fourth quarter of 2008. By signing the settlement agreement the Company relinquished its rights to bring any claims against the financial institution as well as its right to serve as a class representative or receive benefits under any class action. Further, the Company no longer has the sole discretion and right to sell or otherwise dispose of, and/or enter orders in the auction process with respect to the underlying securities. As part of the settlement, the Company obtained a put option to sell the underlying securities to the financial institution which is exercisable during the period starting on June 30, 2010 through July 2, 2012 plus accrued interest. Should the financial institution sell or otherwise dispose of our securities the Company will receive the par value of the securities plus accrued interest one business day after the transaction. Upon signing the settlement . . .