Highlights for the second quarter, which included the results of the acquisition of the Network Services (NWS) business of Alliance Data for one month, include:

• Total transaction processing volume of $17.1 billion, up 29%, $15.2 billion organic volume, up 14%
• Net Revenue up 29.3%, and excluding NWS increased by 17.7%
• Earnings per share up 15% and net income up 10.3% from the second quarter of 2007
• New margin installed increased by 12.2%
• Operating margin on net revenue of 19.4%

Robert Carr, Chairman and CEO, said, "Our record second quarter is a reflection of our ability to achieve solid current results while investing for the future, even in a challenging environment. In the near term we are clearly facing a difficult economy, which resulted in same store sales in the quarter declining 0.1%, the first such decline in our history. Nevertheless, this quarter we continued our string of double-digit growth in new margin installed while increasing our processing volume 14%, excluding NWS, as we continue to increase our market share. Although we are only two months into the process today, the integration of NWS is proceeding nicely, and we are enthusiastic about the long-term benefits the transaction will offer to Heartland's growth and profitability. Through our organic growth, acquisitions, and investments in new verticals, products, and markets, Heartland's "Fair Deal" is rapidly becoming the premier brand in the payment processing industry."

Total revenues in the second quarter were $395 million, an increase of 18.3% compared to $333 million in the second quarter of 2007. Card processing volume for the three months ended June 30, 2008 increased 29.0% to $17.1 billion, including $2.0 billion of volume from acquisitions. Transaction processing volume and net revenue growth continue to benefit from the installation of larger and more profitable merchants onto our platform.

Mr. Carr continued, "In the quarter we accomplished many strategic objectives, achieving greater penetration of the broad payments space and setting the stage for our next growth phase. Our card business is very strong, growing faster than the industry, and is preparing to add incremental volume, processing Discover and American Express transactions along with the NWS volume already added. In addition, we are also making solid progress in the payroll, remote deposit, and campus card markets. The second half of the year should be an exciting time as we begin to realize the benefits of both the NWS integration and our various investments."

SIX MONTH RESULTS:

For the first six months of 2008, net income was $20.4 million or $0.53 per fully diluted share, increases of 19% and 23%, respectively, from the first six months of 2007. Revenues for the first half of 2008 were $734 million, up 19% compared to the first half of 2007.

FULL YEAR 2008 GUIDANCE:

The Company is affirming guidance for fiscal 2008. For the year, we expect net revenue (total revenues less interchange, dues and assessments) to grow by 16% - 18% organically, and in excess of 35% including NWS; and earnings per share to be $1.13 - $1.17.

DIVIDEND:

The Company also announced that the Board of Directors has declared a third quarter dividend of $0.09 per common share. The dividend is payable to shareholders of record on August 22, 2008 and will be paid on September 15, 2008.

Read the consolidated statements of income here: