chrw-20220727
0001043277false00010432772022-07-272022-07-27
    
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K

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

Date of Report: July 27, 2022
(Date of earliest event reported)
C.H. ROBINSON WORLDWIDE, INC.
(Exact name of registrant as specified in its charter)

Commission File Number: 000-23189
Delaware 41-1883630
(State or other jurisdiction of
incorporation or organization)
 
(I.R.S. Employer
Identification No.)

14701 Charlson Road
Eden Prairie, Minnesota 55347
(Address of principal executive offices, including zip code)

Registrant's telephone number, including area code: 952-937-8500

Not Applicable
(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common Stock, $0.10 par valueCHRWNasdaq Global Select Market

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter). Emerging growth company  ☐

If an emerging growth 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.  ☐



    
Item 2.02    Results of Operations and Financial Condition.

The following information is being "furnished" in accordance with the General Instruction B.2 of Form 8-K and shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or otherwise subject to the liabilities of that section, nor shall it be deemed to be incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such filing.

Furnished herewith as Exhibits 99.1 and 99.2, respectively, and incorporated by reference herein are the text of the Company's announcement regarding its financial results for the quarter ended June 30, 2022 and its earnings conference call slides.


Item 9.01    Financial Statements and Exhibits.

(d)    Exhibits
NumberDescription
99.1
99.2
104The cover page from the Current Report on Form 8-K formatted in Inline XBRL



    
SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
C.H. ROBINSON WORLDWIDE, INC.
By:/s/ Ben G. Campbell
Ben G. Campbell
Chief Legal Officer and Secretary
Date: July 27, 2022



C.H. Robinson
14701 Charlson Rd.
Eden Prairie, MN 55347
www.chrobinson.com

FOR INQUIRIES, CONTACT:
Chuck Ives, Director of Investor Relations
FOR IMMEDIATE RELEASE

C.H. Robinson Reports 2022 Second Quarter Results
Eden Prairie, MN, July 27, 2022 - C.H. Robinson Worldwide, Inc. (“C.H. Robinson”) (Nasdaq: CHRW) today reported financial results for the quarter ended June 30, 2022.
Second Quarter Key Metrics:
•Gross profits and adjusted gross profits(1) increased 37.7% to $1.0 billion
•Income from operations increased 80.2% to $469.7 million
•Adjusted operating margin(1) increased 1,070 basis points to 45.5%
•Diluted earnings per share (EPS) increased 85.4% to $2.67
•Cash generated by operations improved by $116.0 million to $265.3 million
(1) Adjusted gross profits and adjusted operating margin are Non-GAAP financial measures. The same factors described in this release that impacted these Non-GAAP measures also impacted the comparable GAAP measures. Refer to page 10 for further discussion and a GAAP to Non-GAAP reconciliation.

"Our second quarter was another quarter of record profits, as our business model performed as we would expect it to in this part of the cycle," said Bob Biesterfeld, President and Chief Executive Officer of C.H. Robinson. "Our investments in our customer relationships through the early part of the cycle, while the cost of purchased transportation was rapidly increasing, are paying dividends as we retain and gain share with these customers through the terms of our agreements. Our strong results were again driven by significant operating margin expansion in our North American Surface Transportation business, as we further improved the profitability of our truckload and less-than truckload businesses and grew our truckload volume in a declining market. Our Global Forwarding team continued to deliver strong financial results, while benefiting from the market share they’ve gained over the past couple of years."

1

Summary of Second Quarter Results Compared to the Second Quarter of 2021
•Total revenues increased 22.9% to $6.8 billion, driven primarily by higher pricing across most of our services and higher truckload and ocean volume.
•Gross profits and adjusted gross profits increased 37.7% to $1.0 billion, primarily driven by higher adjusted gross profit per transaction across most of our services and higher truckload and ocean volume.
•Operating expenses increased 15.0% to $561.9 million. Personnel expenses increased 22.6% to $444.8 million, primarily due to higher headcount, which increased 16.2%, and higher incentive compensation costs. Selling, general and administrative ("SG&A") expenses of $117.2 million decreased 6.8% and included a $25.3 million gain on the sale-leaseback of our Kansas City regional center. This was partially offset by higher purchased and contracted services and increased travel expenses.
•Income from operations totaled $469.7 million, up 80.2% due to the increase in adjusted gross profits, partially offset by the increase in operating expenses. Adjusted operating margin of 45.5% increased 1,070 basis points.
•Interest and other income/expense, net totaled $27.4 million of expense, consisting primarily of $17.0 million of interest expense, which increased $4.3 million versus last year due to a higher average debt balance, and $10.3 million of foreign currency revaluation and realized foreign currency gains and losses, which increased $8.4 million versus last year due to the strengthening of the U.S. Dollar, primarily versus the Euro and Yuan.
•The effective tax rate in the quarter was 21.3% compared to 21.6% in the second quarter last year.
•Net income totaled $348.2 million, up 79.7% from a year ago. Diluted EPS of $2.67 increased 85.4%.


2

Summary of Year-to-Date Results Compared to 2021

•Total revenues increased 31.7% to $13.6 billion, driven primarily by higher pricing and higher volume across most of our services.
•Gross profits and adjusted gross profits increased 33.5% to $1.9 billion, primarily driven by higher adjusted gross profit per transaction and higher volume across most of our services.
•Operating expenses increased 16.0% to $1.1 billion. Personnel expenses increased 18.6% to $858.1 million, primarily due to higher headcount, which increased 15.2%, and higher incentive compensation costs. SG&A expenses increased 8.5% to $264.5 million, primarily due to increases in purchased and contracted services, travel expenses and warehouse expenses, partially offset by a $25.3 million gain on the sale-leaseback of our Kansas City regional center.
•Income from operations totaled $815.1 million, up 68.4% from last year, primarily due to the increase in adjusted gross profits, partially offset by the increase in operating expenses. Adjusted operating margin of 42.1% increased 880 basis points.
•Interest and other income/expense, net totaled $41.6 million of expense, which primarily consists of $31.5 million of interest expense, which increased $6.6 million versus last year due to a higher average debt balance. The full year also included a $11.8 million unfavorable impact from foreign currency revaluation and realized foreign currency gains and losses, due to the strengthening of the U.S. Dollar, primarily versus the Euro and Yuan.
•The effective tax rate for the six months was 20.0% compared to 20.1% in the year-ago period.
•Net income totaled $618.5 million, up 68.5% from a year ago. Diluted EPS of $4.71 increased 73.8%.



3

North American Surface Transportation ("NAST") Results
Summarized financial results of our NAST segment are as follows (dollars in thousands):
Three Months Ended June 30,Six Months Ended June 30,
20222021% change20222021% change
Total revenues$4,147,046 $3,585,481 15.7 %$8,261,935 $6,796,904 21.6 %
Adjusted gross profits(1)
624,551 436,596 43.1 %1,130,651 857,704 31.8 %
Income from operations276,499 151,092 83.0 %458,853 287,876 59.4 %
____________________________________________
(1) Adjusted gross profits is a non-GAAP financial measure explained later in this release. The difference between adjusted gross profits and gross profits is not material.

Second quarter total revenues for the NAST segment totaled $4.1 billion, an increase of 15.7% over the prior year, primarily driven by higher truckload and less-than truckload ("LTL") pricing and an increase in truckload shipments. NAST adjusted gross profits increased 43.1% in the quarter to $624.6 million. Adjusted gross profits in truckload increased 50.8% due to a 48.0% increase in adjusted gross profit per shipment and a 2.0% increase in truckload volume. Our average truckload linehaul rate per mile charged to our customers, which excludes fuel surcharges, increased approximately 1.5% in the quarter compared to the prior year, while truckload linehaul cost per mile, excluding fuel surcharges, decreased approximately 5.0%, resulting in a 46.5% increase in truckload adjusted gross profit per mile. LTL adjusted gross profits increased 30.2% versus the year-ago period, as adjusted gross profit per order increased 37.0% and LTL volumes declined 5.0%. Operating expenses increased 21.9% primarily due to increased salaries, incentive compensation, and technology expenses. Income from operations increased 83.0% to $276.5 million, and adjusted operating margin expanded 970 basis points to 44.3%. NAST average headcount was up 14.8% in the quarter.


4

Global Forwarding Results
Summarized financial results of our Global Forwarding segment are as follows (dollars in thousands):
Three Months Ended June 30,Six Months Ended June 30,
20222021% change20222021% change
Total revenues$2,093,190 $1,450,794 44.3 %$4,287,587 $2,606,833 64.5 %
Adjusted gross profits(1)
324,443 238,754 35.9 %646,291 453,054 42.7 %
Income from operations167,557 108,212 54.8 %335,195 198,801 68.6 %
____________________________________________
(1) Adjusted gross profits is a non-GAAP financial measure explained later in this release. The difference between adjusted gross profits and gross profits is not material.

Second quarter total revenues for the Global Forwarding segment increased 44.3% to $2.1 billion, primarily driven by higher pricing and higher volume in our ocean service, reflecting the strong demand environment and market share gains. Adjusted gross profits increased 35.9% in the quarter to $324.4 million. Ocean adjusted gross profits increased 51.1%, driven by a 47.5% increase in adjusted gross profit per shipment and a 2.5% increase in shipments. Adjusted gross profits in air increased 7.5% driven by a 14.0% increase in adjusted gross profit per metric ton shipped, partially offset by a 6.0% decrease in metric tons shipped. Customs adjusted gross profits increased 9.0%, driven by a 10.5% increase in transaction volume. Operating expenses increased 20.2%, primarily driven by increased salaries, incentive compensation, technology and travel expenses. Second quarter average headcount increased 17.3%. Income from operations increased 54.8% to $167.6 million, and adjusted operating margin expanded 630 basis points to 51.6% in the quarter.


5

All Other and Corporate Results

Total revenues and adjusted gross profits for Robinson Fresh, Managed Services and Other Surface Transportation are summarized as follows (dollars in thousands):
Three Months Ended June 30,Six Months Ended June 30,
20222021% change20222021% change
Total revenues$558,239 $496,451 12.4 %$1,064,906 $932,858 14.2 %
Adjusted gross profits(1):
Robinson Fresh$34,981 $29,940 16.8 %$65,486 $54,888 19.3 %
Managed Services27,618 26,234 5.3 %55,700 51,790 7.5 %
Other Surface Transportation20,020 17,652 13.4 %39,681 34,120 16.3 %
____________________________________________
(1) Adjusted gross profits is a non-GAAP financial measure explained later in this release. The difference between adjusted gross profits and gross profits is not material.

Second quarter Robinson Fresh adjusted gross profits increased 16.8% to $35.0 million, due to an 8.5% increase in case volume and an increase in integrated supply chain and technology services. Managed Services adjusted gross profits increased 5.3% in the quarter, due to growth in business with both new and existing customers. Other Surface Transportation adjusted gross profits increased 13.4% to $20.0 million, primarily due to a 16.7% increase in Europe truckload adjusted gross profits.

Other Income Statement Items
The second quarter effective tax rate was 21.3%, down from 21.6% last year. We expect our 2022 full-year effective tax rate to be 19% to 21%.
Interest and other income/expense, net totaled $27.4 million of expense, consisting primarily of $17.0 million of interest expense, which increased $4.3 million versus the second quarter of 2021 due to a higher average debt balance, and $10.3 million of foreign currency revaluation and realized foreign currency gains and losses, which increased $8.4 million versus the second quarter of 2021 due to the strengthening of the U.S. Dollar, primarily versus the Euro and Yuan.
Diluted weighted average shares outstanding in the quarter were down 3.4% due primarily to share repurchases over the past twelve months.


6

Cash Flow Generation and Capital Distribution
Cash from operations totaled $265.3 million in the second quarter, compared to $149.3 million in the second quarter of 2021. The $116.0 million improvement was primarily due to a $154.4 million increase in net income.
In the second quarter of 2022, cash returned to shareholders increased 100% versus last year to $409.2 million, with $336.7 million in repurchases of common stock and $72.4 million in cash dividends.
Capital expenditures totaled $43.2 million in the quarter. Capital expenditures for 2022 are now expected to be $110 million to $120 million, up from our prior guidance of $90 million to $100 million, primarily due to a higher level of internally developed software.

Outlook
"As questions linger about global economic growth, inflationary pressures, and consumer discretionary spending, our global suite of multimodal services, our growing digital platform, our responsive team of logistics experts, and our resilient and flexible non-asset-based business model put us in a position to continue delivering strong financial results," Biesterfeld stated. "While we are pleased with our performance this quarter and the fact that both NAST and Global Forwarding delivered operating margins above our publicly stated targets, we know that we have work to do to consistently deliver at our targeted level. The work that the team is executing related to scaling our model, eliminating internal legacy processes and improving quality, while working backwards from the needs of our customers and carriers, will drive continued improvement in operating profits long-term. As we look to the second half of the year, we are watching economic conditions closely, and the management team and board continue to consider all strategies to grow operating profits and maximize long-term shareholder returns through all phases of the business cycle and various economic scenarios."



7

About C.H. Robinson
C.H. Robinson solves logistics problems for companies across the globe and across industries, from the simple to the most complex. With $28 billion in freight under management and 20 million shipments annually, we are one of the world’s largest logistics platforms. Our global suite of services accelerates trade to seamlessly deliver the products and goods that drive the world’s economy. With the combination of our multimodal transportation management system and expertise, we use our information advantage to deliver smarter solutions for our 100,000 customers and 85,000 contract carriers. Our technology is built by and for supply chain experts to bring faster, more meaningful improvements to our customers’ businesses. As a responsible global citizen, we are also proud to contribute millions of dollars to support causes that matter to our company, our Foundation and our employees. For more information, visit us at www.chrobinson.com (Nasdaq: CHRW).

Except for the historical information contained herein, the matters set forth in this release are forward-looking statements that represent our expectations, beliefs, intentions or strategies concerning future events. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from our historical experience or our present expectations, including, but not limited to, such factors as changes in economic conditions, including uncertain consumer demand; changes in market demand and pressures on the pricing for our services; fuel price increases or decreases, or fuel shortages; competition and growth rates within the global logistics industry; freight levels and increasing costs and availability of truck capacity or alternative means of transporting freight; risks associated with significant disruptions in the transportation industry; changes in relationships with existing contracted truck, rail, ocean, and air carriers; changes in our customer base due to possible consolidation among our customers; risks with reliance on technology to operate our business; cyber-security related risks; risks associated with operations outside of the United States; our ability to identify or complete suitable acquisitions; our ability to successfully integrate the operations of acquired companies with our historic operations; risks associated with litigation, including contingent auto liability and insurance coverage; risks associated with the potential impact of changes in government regulations; our ability to hire and retain a sufficient number of qualified personnel; risks associated with the changes to income tax regulations; risks associated with the produce industry, including food safety and contamination issues; the impact of war on the economy; changes to our capital structure; changes due to catastrophic events including pandemics such as COVID-19; and other risks and uncertainties detailed in our Annual and Quarterly Reports.
Any forward-looking statement speaks only as of the date on which such statement is made, and we undertake no obligation to update such statement to reflect events or circumstances arising after such date. All remarks made during our financial results conference call will be current at the time of the call, and we undertake no obligation to update the replay.

Conference Call Information:
C.H. Robinson Worldwide Second Quarter 2022 Earnings Conference Call
Wednesday, July 27, 2022; 5:00 p.m. Eastern Time
Presentation slides and a simultaneous live audio webcast of the conference call may be accessed through the Investor Relations link on C.H. Robinson’s website at www.chrobinson.com.
To participate in the conference call by telephone, please call ten minutes early by dialing: 877-269-7756
International callers dial +1-201-689-7817

8


Adjusted Gross Profit by Service Line
(in thousands)

This table of summary results presents our service line adjusted gross profits on an enterprise basis. The service line adjusted gross profits in the table differ from the service line adjusted gross profits discussed within the segments as our segments have revenues from multiple service lines.
Three Months Ended June 30,Six Months Ended June 30,
20222021% change20222021% change
Adjusted gross profits(1):
  Transportation
     Truckload$456,260 $308,027 48.1 %$816,047 $608,050 34.2 %
     LTL168,298 129,868 29.6 %320,610 251,421 27.5 %
     Ocean227,958 150,986 51.0 %449,421 286,496 56.9 %
     Air56,871 53,057 7.2 %118,305 98,951 19.6 %
     Customs27,820 25,513 9.0 %55,315 49,735 11.2 %
     Other logistics services61,561 53,692 14.7 %117,197 105,432 11.2 %
     Total transportation998,768 721,143 38.5 %1,876,895 1,400,085 34.1 %
  Sourcing32,845 28,033 17.2 %60,914 51,471 18.3 %
Total adjusted gross profits$1,031,613 $749,176 37.7 %$1,937,809 $1,451,556 33.5 %
____________________________________________
(1) Adjusted gross profits is a non-GAAP financial measure explained later in this release. The difference between adjusted gross profits and gross profits is not material.
9

GAAP to Non-GAAP Reconciliation
(unaudited, in thousands)

Our adjusted gross profit is a non-GAAP financial measure. Adjusted gross profit is calculated as gross profit excluding amortization of internally developed software utilized to directly serve our customers and contracted carriers. We believe adjusted gross profit is a useful measure of our ability to source, add value, and sell services and products that are provided by third parties, and we consider adjusted gross profit to be a primary performance measurement. Accordingly, the discussion of our results of operations often focuses on the changes in our adjusted gross profit. The reconciliation of gross profit to adjusted gross profit is presented below (in thousands):
 Three Months Ended June 30,Six Months Ended June 30,
20222021% change20222021% change
Revenues:
Transportation$6,465,642 $5,240,448 23.4 %$12,993,993 $9,800,675 32.6 %
Sourcing332,833 292,278 13.9 %620,435 535,920 15.8 %
Total revenues6,798,475 5,532,726 22.9 %13,614,428 10,336,595 31.7 %
Costs and expenses:
Purchased transportation and related services5,466,874 4,519,305 21.0 %11,117,098 8,400,590 32.3 %
Purchased products sourced for resale299,988 264,245 13.5 %559,521 484,449 15.5 %
Direct internally developed software amortization6,640 4,802 38.3 %12,374 9,449 31.0 %
Total direct expenses5,773,502 4,788,352 20.6 %11,688,993 8,894,488 31.4 %
Gross profit$1,024,973 $744,374 37.7 %$1,925,435 $1,442,107 33.5 %
Plus: Direct internally developed software amortization6,640 4,802 38.3 %12,374 9,449 31.0 %
Adjusted gross profit$1,031,613 $749,176 37.7 %$1,937,809 $1,451,556 33.5 %

Our adjusted operating margin is a non-GAAP financial measure calculated as operating income divided by adjusted gross profit. We believe adjusted operating margin is a useful measure of our profitability in comparison to our adjusted gross profit which we consider a primary performance metric as discussed above. The comparison of operating margin to adjusted operating margin is presented below:
Three Months Ended June 30,Six Months Ended June 30,
20222021% change20222021% change
Total revenues$6,798,475 $5,532,726 22.9 %$13,614,428 $10,336,595 31.7 %
Operating income469,665 260,604 80.2 %815,139 483,933 68.4 %
Operating margin6.9 %4.7 %220 bps6.0 %4.7 %130 bps
Adjusted gross profit$1,031,613 $749,176 37.7 %$1,937,809 $1,451,556 33.5 %
Operating income469,665 260,604 80.2 %815,139 483,933 68.4 %
Adjusted operating margin45.5 %34.8 %1,070 bps42.1 %33.3 %880 bps

10

Condensed Consolidated Statements of Income
(unaudited, in thousands, except per share data)
Three Months Ended June 30,Six Months Ended June 30,
20222021% change20222021% change
Revenues:
 Transportation$6,465,642 $5,240,448 23.4 %$12,993,993 $9,800,675 32.6 %
 Sourcing332,833 292,278 13.9 %620,435 535,920 15.8 %
   Total revenues6,798,475 5,532,726 22.9 %13,614,428 10,336,595 31.7 %
Costs and expenses:
 Purchased transportation and related services5,466,874 4,519,305 21.0 %11,117,098 8,400,590 32.3 %
 Purchased products sourced for resale299,988 264,245 13.5 %559,521 484,449 15.5 %
 Personnel expenses444,764 362,901 22.6 %858,125 723,736 18.6 %
Other selling, general, and administrative expenses117,184 125,671 (6.8)%264,545 243,887 8.5 %
   Total costs and expenses6,328,810 5,272,122 20.0 %12,799,289 9,852,662 29.9 %
Income from operations469,665 260,604 80.2 %815,139 483,933 68.4 %
Interest and other income/expense, net(27,395)(13,497)103.0 %(41,569)(24,757)67.9 %
Income before provision for income taxes442,270 247,107 79.0 %773,570 459,176 68.5 %
Provision for income taxes94,085 53,318 76.5 %155,037 92,082 68.4 %
Net income$348,185 $193,789 79.7 %$618,533 $367,094 68.5 %
Net income per share (basic)$2.71 $1.45 86.9 %$4.78 $2.74 74.5 %
Net income per share (diluted)$2.67 $1.44 85.4 %$4.71 $2.71 73.8 %
Weighted average shares outstanding (basic)128,405 133,275 (3.7)%129,447 133,888 (3.3)%
Weighted average shares outstanding (diluted)130,338 134,856 (3.4)%131,218 135,276 (3.0)%


11

Business Segment Information
(unaudited, in thousands, except average headcount)
NASTGlobal Forwarding
All
Other and Corporate
Consolidated
Three Months Ended June 30, 2022
Total revenues$4,147,046 $2,093,190 $558,239 $6,798,475 
Adjusted gross profits(1)
624,551 324,443 82,619 1,031,613 
Income from operations276,499 167,557 25,609 469,665 
Depreciation and amortization6,123 5,471 11,668 23,262 
Total assets(2)
3,688,215 2,851,114 918,110 7,457,439 
Average headcount7,552 5,759 4,582 17,893 
NASTGlobal Forwarding
All
Other and Corporate
Consolidated
Three Months Ended June 30, 2021
Total revenues$3,585,481 $1,450,794 $496,451 $5,532,726 
Adjusted gross profits(1)
436,596 238,754 73,826 749,176 
Income from operations151,092 108,212 1,300 260,604 
Depreciation and amortization6,534 6,276 10,127 22,937 
Total assets(2)
3,278,540 1,852,473 775,551 5,906,564 
Average headcount6,580 4,909 3,916 15,405 
____________________________________________
(1) Adjusted gross profits is a non-GAAP financial measure explained above. The difference between adjusted gross profits and gross profits is not material.
(2) All cash and cash equivalents are included in All Other and Corporate.


12

Business Segment Information
(unaudited, in thousands, except average headcount)
NASTGlobal Forwarding
All
Other and Corporate
Consolidated
Six Months Ended June 30, 2022
Total revenues$8,261,935 $4,287,587 $1,064,906 $13,614,428 
Adjusted gross profits(1)
1,130,651 646,291 160,867 1,937,809 
Income from operations458,853 335,195 21,091 815,139 
Depreciation and amortization12,362 11,026 22,360 45,748 
Total assets(2)
3,688,215 2,851,114 918,110 7,457,439 
Average headcount7,442 5,690 4,422 17,554 
NASTGlobal Forwarding
All
Other and Corporate
Consolidated
Six Months Ended June 30, 2021
Total revenues$6,796,904 $2,606,833 $932,858 $10,336,595 
Adjusted gross profits(1)
857,704 453,054 140,798 1,451,556 
Income (loss) from operations287,876 198,801 (2,744)483,933 
Depreciation and amortization13,159 11,925 21,131 46,215 
Total assets(2)
3,278,540 1,852,473 775,551 5,906,564 
Average headcount6,578 4,832 3,823 15,233 

____________________________________________
(1) Adjusted gross profits is a non-GAAP financial measure explained above. The difference between adjusted gross profits and gross profits is not material.
(2)All cash and cash equivalents are included in All Other and Corporate.




13

Condensed Consolidated Balance Sheets
(unaudited, in thousands)
June 30, 2022December 31, 2021
Assets
   Current assets:
     Cash and cash equivalents$238,925 $257,413 
     Receivables, net of allowance for credit loss4,302,321 3,963,487 
     Contract assets, net of allowance for credit loss518,752 453,660 
     Prepaid expenses and other108,258 129,593 
        Total current assets5,168,256 4,804,153 
 
  Property and equipment, net of accumulated depreciation and amortization155,829 139,831 
  Right-of-use lease assets338,223 292,559 
  Intangible and other assets, net of accumulated amortization1,795,131 1,791,569 
Total assets$7,457,439 $7,028,112 
Liabilities and stockholders’ investment
  Current liabilities:
     Accounts payable and outstanding checks$1,926,857 $1,919,301 
     Accrued expenses:
        Compensation190,428 201,421 
        Transportation expense405,284 342,778 
        Income taxes38,850 100,265 
        Other accrued liabilities177,645 171,266 
Current lease liabilities72,686 66,311 
Current portion of debt674,000 525,000 
        Total current liabilities3,485,750 3,326,342 
Long-term debt1,594,055 1,393,649 
Noncurrent lease liabilities281,319 241,369 
Noncurrent income taxes payable26,291 28,390 
Deferred tax liabilities16,521 16,113 
  Other long-term liabilities1,088 315 
Total liabilities5,405,024 5,006,178 
Total stockholders’ investment2,052,415 2,021,934 
Total liabilities and stockholders’ investment$7,457,439 $7,028,112 

14

Condensed Consolidated Statements of Cash Flow
(unaudited, in thousands, except operational data)
Six Months Ended June 30,
20222021
Operating activities:
Net income$618,533 $367,094 
Adjustments to reconcile net income to net cash provided by (used for) operating activities:
 Depreciation and amortization45,748 46,215 
 Provision for credit losses(2,142)(36)
 Stock-based compensation52,535 53,150 
 Deferred income taxes(5,844)(2,474)
 Excess tax benefit on stock-based compensation(7,553)(9,367)
Other operating activities(26,356)933 
Changes in operating elements, net of acquisitions:
Receivables(378,641)(717,340)
Contract assets (65,362)(96,154)
Prepaid expenses and other(14,170)(38,971)
Accounts payable and outstanding checks37,207 406,875 
Accrued compensation(9,673)12,115 
Accrued transportation expenses62,506 73,167 
Accrued income taxes(54,964)(4,431)
Other accrued liabilities1,391 210 
Other assets and liabilities(1,886)1,612 
Net cash provided by operating activities251,329 92,598 
Investing activities:
Purchases of property and equipment(36,781)(12,856)
Purchases and development of software(32,622)(16,981)
Acquisitions, net of cash acquired— (14,749)
Other investing activities63,208 — 
Net cash used for investing activities(6,195)(44,586)
Financing activities:
Proceeds from stock issued for employee benefit plans53,574 36,674 
Total repurchases of common stock(514,483)(285,987)
Cash dividends(145,268)(139,756)
Proceeds from long-term borrowings200,000 — 
Proceeds from short-term borrowings2,735,000 1,661,000 
Payments on short-term borrowings(2,586,000)(1,390,038)
Net cash used for financing activities(257,177)(118,107)
Effect of exchange rates on cash(6,445)(898)
Net change in cash and cash equivalents(18,488)(70,993)
Cash and cash equivalents, beginning of period257,413 243,796 
Cash and cash equivalents, end of period$238,925 $172,803 
As of June 30,
Operational Data:20222021
Employees 18,146 15,705 


Source: C.H. Robinson
CHRW-IR
15
1 Q2 2022 July 27, 2022 Earnings Presentation Bob Biesterfeld, CEO Arun Rajan, CPO Mike Zechmeister, CFO Chuck Ives, Director of IR

 
Safe Harbor Statement Except for the historical information contained herein, the matters set forth in this presentation and the accompanying earnings release are forward-looking statements that represent our expectations, beliefs, intentions or strategies concerning future events. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from our historical experience or our present expectations, including, but not limited to such factors as changes in economic conditions, including uncertain consumer demand; changes in market demand and pressures on the pricing for our services; fuel price increases or decreases, or fuel shortages; competition and growth rates within the global logistics industry; freight levels and increasing costs and availability of truck capacity or alternative means of transporting freight; risks associated with significant disruptions in the transportation industry; changes in relationships with existing contracted truck, rail, ocean, and air carriers; changes in our customer base due to possible consolidation among our customers; risks with reliance on technology to operate our business; cyber- security related risks; risks associated with operations outside of the United States; our ability to identify or complete suitable acquisitions; our ability to successfully integrate the operations of acquired companies with our historic operations; risks associated with litigation, including contingent auto liability and insurance coverage; risks associated with the potential impact of changes in government regulations; our ability to hire and retain a sufficient number of qualified personnel; risks associated with the changes to income tax regulations; risks associated with the produce industry, including food safety and contamination issues; the impact of war on the economy; changes to our capital structure; changes due to catastrophic events including pandemics such as COVID-19; and other risks and uncertainties detailed in our Annual and Quarterly Reports. Any forward-looking statement speaks only as of the date on which such statement is made, and we undertake no obligation to update such statement to reflect events or circumstances arising after such date. 2©2022 C.H. Robinson Worldwide, Inc. All Rights Reserved.

 
Q2 Highlights: Record Quarterly Financial Results 3 ■ Adjusted operating margin expanded to 44.3% in NAST and 51.6% in Global Forwarding ■ Grew Truckload volume in a declining market ■ Truckload AGP per shipment improved 48% as the cost of purchased transportation declined faster than prices ■ Global Forwarding continues to deliver strong financial results from market share gains ■ Results include a $25.3M gain from a sale-leaseback of our Kansas City regional center and a $10.3M loss on foreign currency revaluation $6.8B Total Revenues +23% Y/Y $1.0B Adj. Gross Profit +38% Y/Y $470M Income from Ops. +80% Y/Y $2.67 Diluted Earnings/Share +85% Y/Y Q2 2022

 
All Other & Corporate ■ Robinson Fresh case volume up 8.5% in Q2 ■ Managed Services Q2 FUM(3) up 13% Y/Y ■ Europe Surface Transportation continues to grow truckload AGP Global Forwarding (GF) ■ Nine consecutive quarters of year-over-year growth in total revenues, AGP and operating income ■ Continuing to add new commercial relationships with strategic, multi- national customers ■ Continuing to make investments in technology, data and analytics and our global network North American Surface Transportation (NAST) ■ Adjusted gross profit (AGP) per load continued to improve in both TL and LTL ■ Digital investments continue to deliver customer and carrier value and unlock growth ■ Load-to-truck ratios indicate the truckload market is more balanced by historical standards ■ Significant market share opportunities ■ 598,000 fully automated truckload bookings w/carriers, up 107% Y/Y ■ 71% of spot volume was priced through our real-time, dynamic pricing tools in Q2 Segment Highlights: Diversified, Global Suite of Services 4 Q2 2022 Adjusted Gross Profit(2) +43.1% Y/Y +11.9% Y/Y +35.9% Y/Y 1. Measured over trailing twelve months 2. Adjusted gross profit and adjusted gross profit margin are non-GAAP financial measures. Adjusted gross profit is calculated as gross profit excluding amortization of internally developed software utilized to directly serve our customers and contracted carriers. 3. FUM = Freight under Management Over half of total revenues and adjusted gross profits came from customers to whom we provide both surface transportation and global forwarding services.(1)

 
NAST Q2’22 Results by Service 5 ▪ Truckload volume up 2.0%, compared to the Cass Freight Index that reflected a 2% decline in shipments (2) ▪ Truckload AGP per shipment increased 48% due to a higher AGP per shipment on contractual volume (2) ▪ Continued to reprice contractual portfolio with focus on profitable market share ▪ LTL volume down 5.0% and AGP per order increased 37.0% (2) ▪ 598,000 fully automated truckload bookings in Q2, up 107% ▪ Added 12,300 new carriers in Q2 2Q22 2Q21 %▲ Truckload (“TL”) $432.0 $286.6 50.8% Less than Truckload (“LTL”) $166.9 $128.2 30.2% Other $25.6 $21.9 17.2% Total Adjusted Gross Profits $624.6 $436.6 43.1% Adjusted Gross Profit Margin % 15.1% 12.2% 290 bps Adjusted Gross Profit (1) ($ in millions) 1. Adjusted gross profit and adjusted gross profit margin are non-GAAP financial measures. Adjusted gross profit is calculated as gross profit excluding amortization of internally developed software utilized to directly serve our customers and contracted carriers. 2. Growth rates are rounded to the nearest 0.5 percent.

 
Truckload Price and Cost Change (1)(2)(3) 6 Truckload Q2 Volume(2)(4) +2.0 % Pricing(1)(2)(3) +1.5 % Cost(1)(2)(3) -5.0 % Adjusted Gross Profit(4) +50.8 % 1. Price and cost change represents YoY change for North America truckload shipments across all segments. 2. Growth rates are rounded to the nearest 0.5 percent. ■ 60% / 40% truckload contractual to transactional volume mix, up from 55% / 45% in Q2 last year ■ Average routing guide depth of 1.4 in Managed Services business vs. 1.7 in Q2 last year 3. Pricing and cost measures exclude fuel surcharges and costs. 4. Truckload volume and adjusted gross profit growth represents YoY change for NAST truckload. Yo Y % C ha ng e in P ric e an d C os t YoY Price Change YoY Cost Change 2016 2017 2018 2019 2020 2021 2022 -20% -10% 0% 10% 20% 30% 40% 50%

 
Truckload AGP $ per Shipment Significantly Improved 7 ■ AGP $ per Truckload Shipment reflects business performance better than AGP Margin % (1) ■ While NAST AGP Margin % has declined 20 bps compared to Q2 2020, AGP $ per Truckload Shipment has grown 59% over the same timeframe N A ST A dj us te d G ro ss P ro fit $ p er T ru ck lo ad Sh ip m en t N A ST A djusted G ross Profit M argin % NAST Adjusted Gross Profit $ per Truckload Shipment NAST Adjusted Gross Profit Margin % Average AGP $ per Truckload Shipment 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 11% 12% 13% 14% 15% 16% 17% 18% 19% 20% 1. Adjusted gross profit and adjusted gross profit margin are non-GAAP financial measures. Adjusted gross profit is calculated as gross profit excluding amortization of internally developed software utilized to directly serve our customers and contracted carriers.

 
Global Forwarding Q2’22 Results by Service 8 2Q22 2Q21 %▲ Ocean $228.1 $150.9 51.1% Air $56.1 $52.2 7.5% Customs $27.8 $25.5 9.0% Other $12.4 $10.1 22.4% Total Adjusted Gross Profits $324.4 $238.8 35.9% Adjusted Gross Profit Margin % 15.5% 16.5% (100 bps) Adjusted Gross Profit (1) ($ in millions) ▪ Ocean AGP increased due to a 47.5% increase in AGP per shipment and a 2.5% increase in shipments (2) ▪ Ocean market becoming more balanced, but rates remain elevated ▪ Air AGP increased due to a 14.0% increase in AGP per metric ton shipped,(2) partially offset by a 6.0% decline in metric tons shipped ▪ Air market stable and air cargo capacity is slowly returning ▪ Customs AGP increased due to a 10.5% increase in volume (2) 1. Adjusted gross profit and adjusted gross profit margin are non-GAAP financial measures. Adjusted gross profit is calculated as gross profit excluding amortization of internally developed software utilized to directly serve our customers and contracted carriers. 2. Growth rates are rounded to the nearest 0.5 percent.

 
All Other & Corporate Q2’22 Results 9 Robinson Fresh ▪ 8.5% increase in case volume, across all verticals (2) ▪ Increased revenue tied to integrated supply chain and technology services Managed Services ▪ AGP growth driven by new customer business, as well as growth with existing customers ▪ Total freight under management up 13% to $1.7B in Q2 (2) Other Surface Transportation ▪ 16.7% increase in Europe truckload AGP 2Q22 2Q21 %▲ Robinson Fresh $35.0 $29.9 16.8% Managed Services $27.6 $26.2 5.3% Other Surface Transportation $20.0 $17.7 13.4% Total $82.6 $73.8 11.9% Adjusted Gross Profit (1) ($ in millions) 1. Adjusted gross profit and adjusted gross profit margin are non-GAAP financial measures. Adjusted gross profit is calculated as gross profit excluding amortization of internally developed software utilized to directly serve our customers and contracted carriers. 2. Growth rates are rounded to the nearest 0.5 percent.

 
Sustainable Growth Strategy 10 Optimize Processes Spend Strategically Grow Globally Scale Digitally Increase Share ■ Leverage integrated service model to grow market share and expand globally ■ Industry-leading tech, people and processes to provide best-in- class service ■ Expand modal capabilities ■ Expand Global Forwarding (“GF”) business as provider of choice for multinational customers ■ Leverage scale to capitalize on secularly growing market and unique global footprint ■ Grow capabilities and presence in key trade lanes and geographies ■ Digitize more internal tools and processes and drive down costs ■ Free customer and carrier reps’ capacity for higher- value touchpoints ■ Drive more revenue synergy across business units ■ Provide customers and carriers the digital products they value ■ Leverage data, scale and information advantage ■ Bring meaningful products, features and insights to both sides of the two- sided marketplace ■ Support organic growth by leveraging strong cash flow ■ Modernize core for future integrations ■ Complement with opportunistic M&A

 
Delivering Scalable Digital Solutions to Fuel Growth 11 ■ Scale capacity/procurement Build a digital carrier network that gives customers access to additional capacity ■ Scale demand generation Attract, retain and grow demand via digitally connected channels by delivering technology features that shippers value the most ■ Scale quality customer outcomes Deliver a quality customer experience grounded in better on-time outcomes powered by quality data, predictive insights and in-transit visibility ■ Scale marketplace dynamics Price, cost and match supply and demand with greater intentionality to create optimized results for customers, carriers and CHRW Creating value for the two-sided marketplace through product strategy & innovation 11

 
New Carrier Experiences Driving Digital Adoption 12 ■ Following Navisphere® Carrier enhancements in early February: • Visits per day to Navisphere Carrier ® grew 66% from January to June • Carriers booking loads via Navisphere Carrier ® increased 96% year-over-year in Q2 • Loads booked digitally by carriers increased 142% from January to June and 234% year-over-year in Q2 ■ 598,000 fully automated bookings in NAST truckload business, a 107% increase compared to Q2 2021; $1.1 billion of revenue through this digital channel ■ 71% of spot truckload volume, resulting in $597 million of revenue, was priced through our real-time, dynamic pricing engine in Q2 +66% Visits per Day +96% Y/Y Carriers Booking Loads 107% Y/Y Increase in Fully Automated TL Bookings 71% of Spot Volume through Real-Time Pricing Engine +234% Y/Y Loads Booked Digitally 12

 
Pillars of Our Customer Promise ■ Diversified, global suite of servicesTM - we can reliably meet all logistics services needs today and in the future ■ An information advantage driving smarter solutionsTM and better outcomes through our experience, data and scale ■ Solutions delivered through people you can rely onTM as an extension of your team ■ Technology built by and for supply chain expertsTM - tailored, market-leading solutions that drive better supply chain outcomes 13 Best-in-class solutions delivered through a global network of experts that you can rely on

 
Financial Performance: Record Quarterly Results 14 ■ Changes in cash flow have been driven primarily by increases in operating working capital and improvement in net income. ■ As the cost and price of purchased transportation (inclusive of fuel surcharges) come down, we expect a commensurate benefit to net operating working capital and operating cash flow.

 
Capital Allocation Priorities: Balanced and Opportunistic 15 ■ Prioritize high-return, close-in investments to drive organic growth ■ Opportunistically use M&A to drive total shareholder return by advancing tools, services and global skillset ■ Maintain $600M-750M of liquid assets (cash & equivalents) ■ Stagger debt maturities to reduce refinancing risk ■ Grow dividends in alignment with long-term EBITDA ■ Opportunistic approach to share buybacks ■ 16.8M of share repurchase authorization remaining ■ Optimize Weighted Average Cost of Capital (WACC) by maintaining investment grade credit ratings ■ Efficiently repatriate cash Optimize Balance SheetSustain & Drive Growth Minimize Risk Return Capital Capital Distribution ($M) Share Repurchases Cash Dividends ■ $409 million of cash returned to shareholders in Q2 2022, up 100% ■ Q2 2022 capital distribution equates to 118% of our Q2 net income ■ Uninterrupted dividends, without decline, paid for more than 20 years ■ 3.2 million shares repurchased at an average price of $104.52

 
2022 Strategic Priorities 16 ■ Continue driving long-term diversified growth across an intentional combination of modes, services and geographic footprint ■ Design scalable solutions by transforming our processes, accelerating the pace of development and prioritizing data integrity, in order to improve the customer and carrier experience, drive profitable growth and improve efficiency ■ Maintain a healthy financial profile and attractive margins across the business by leveraging technology advantages and competitive pricing, increasing productivity and managing costs ■ Uphold a balanced approach to capital allocation to drive growth and return capital to shareholders ■ Invest in talent and capabilities, as customers and carriers rely on our teams and digital products

 
17 Appendix

 
Q2 2022 Transportation Results(1) 18 Three Months Ended June 30 Six Months Ended June 30 $ in thousands 2022 2021 % Change 2022 2021 % Change Total Revenues $6,465,642 $5,240,448 23.4 % $12,993,993 $9,800,675 32.6 % Total Adjusted Gross Profits(2) $998,768 $721,143 38.5 % $1,876,895 $1,400,085 34.1 % Adjusted Gross Profit Margin % 15.4 % 13.8 % 160 bps 14.4 % 14.3 % 10 bps Transportation Adjusted Gross Profit Margin % 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Q1 16.3% 15.3% 16.8% 19.7% 17.3% 16.4% 18.6% 15.3% 14.9% 13.5% Q2 15.4% 16.0% 17.5% 19.3% 16.2% 16.2% 18.3% 17.5% 13.8% 15.4% Q3 15.0% 16.2% 18.4% 17.6% 16.4% 16.6% 16.9% 14.4% 13.7% Q4 15.1% 15.9% 19.0% 17.2% 16.6% 17.7% 15.6% 14.3% 13.3% Total 15.4% 15.9% 17.9% 18.4% 16.6% 16.7% 17.3% 15.3% 13.8% 1. Includes results across all segments. 2. Adjusted gross profits is a non-GAAP financial measure explained later in this presentation. The difference between adjusted gross profits and gross profits is not material.

 
Q2 2022 NAST Results 191. Adjusted gross profits is a non-GAAP financial measure explained later in this presentation. The difference between adjusted gross profits and gross profits is not material. Three Months Ended June 30 Six Months Ended June 30, $ in thousands 2022 2021 % Change 2022 2021 % Change Total Revenues $4,147,046 $3,585,481 15.7 % $8,261,935 $6,796,904 21.6 % Total Adjusted Gross Profits(1) $624,551 $436,596 43.1 % $1,130,651 $857,704 31.8 % Adjusted Gross Profit Margin % 15.1 % 12.2 % 290 bps 13.7 % 12.6 % 110 bps Income from Operations $276,499 $151,092 83.0 % $458,853 $287,876 59.4 % Adjusted Operating Margin % 44.3 % 34.6 % 970 bps 40.6 % 33.6 % 700 bps Depreciation and Amortization $6,123 $6,534 (6.3) % $12,362 $13,159 (6.1) % Total Assets $3,688,215 $3,278,540 12.5 % $3,688,215 $3,278,540 12.5 % Average Headcount 7,552 6,580 14.8 % 7,442 6,578 13.1 %

 
Q2 2022 Global Forwarding Results 201. Adjusted gross profits is a non-GAAP financial measure explained later in this presentation. The difference between adjusted gross profits and gross profits is not material. Three Months Ended June 30 Six Months Ended June 30 $ in thousands 2022 2021 % Change 2022 2021 % Change Total Revenues $2,093,190 $1,450,794 44.3 % $4,287,587 $2,606,833 64.5 % Total Adjusted Gross Profits(1) $324,443 $238,754 35.9 % $646,291 $453,054 42.7 % Adjusted Gross Profit Margin % 15.5 % 16.5 % (100 bps) 15.1 % 17.4 % (230 bps) Income from Operations $167,557 $108,212 54.8 % $335,195 $198,801 68.6 % Adjusted Operating Margin % 51.6 % 45.3 % 630 bps 51.9 % 43.9 % 800 bps Depreciation and Amortization $5,471 $6,276 (12.8) % $11,026 $11,925 (7.5) % Total Assets $2,851,114 $1,852,473 53.9 % $2,851,114 $1,852,473 53.9 % Average Headcount 5,759 4,909 17.3 % 5,690 4,832 17.8 %

 
Q2 2022 All Other and Corporate Results 211. Adjusted gross profits is a non-GAAP financial measure explained later in this presentation. The difference between adjusted gross profits and gross profits is not material. 2. Includes a $25.3 million gain on the sale and leaseback of a facility in Kansas City for Three and Six Months Ended June 30, 2022 Three Months Ended June 30 Six Months Ended June 30, $ in thousands 2022 2021 % Change 2022 2021 % Change Total Revenues $558,239 $496,451 12.4 % $1,064,906 $932,858 14.2 % Total Adjusted Gross Profits(1) $82,619 $73,826 11.9 % $160,867 $140,798 14.3 % Income from Operations(2) $25,609 $1,300 NM $21,091 ($2,744) NM Depreciation and Amortization $11,668 $10,127 15.2 % $22,360 $21,131 5.8 % Total Assets $918,110 $775,551 18.4 % $918,110 $775,551 18.4 % Average Headcount 4,582 3,916 17.0 % 4,422 3,823 15.7 %

 
22 Our adjusted gross profit and adjusted gross profit margin are non-GAAP financial measures. Adjusted gross profit is calculated as gross profit excluding amortization of internally developed software utilized to directly serve our customers and contracted carriers. Adjusted gross profit margin is calculated as adjusted gross profit divided by total revenues. We believe adjusted gross profit and adjusted gross profit margin are useful measures of our ability to source, add value, and sell services and products that are provided by third parties, and we consider adjusted gross profit to be a primary performance measurement. The reconciliation of gross profit to adjusted gross profit and gross profit margin to adjusted gross profit margin are presented below: Three Months Ended June 30 Six Months Ended June 30, $ in thousands 2022 2021 2022 2021 Revenues: Transportation $6,465,642 $5,240,448 $12,993,993 $9,800,675 Sourcing 332,833 292,278 620,435 535,920 Total Revenues 6,798,475 5,532,726 13,614,428 10,336,595 Costs and expenses: Purchased transportation and related services 5,466,874 4,519,305 11,117,098 8,400,590 Purchased produced sourced for resale 299,988 264,245 559,521 484,449 Direct internally developed software amortization 6,640 4,802 12,374 9,449 Total direct costs 5,773,502 4,788,352 11,688,993 8,894,488 Gross profit & Gross profit margin $1,024,973 15.1 % $744,374 13.5 % $1,925,435 14.1 % $1,442,107 14.0 % Plus: Direct internally developed software amortization 6,640 4,802 12,374 9,449 Adjusted gross profit/Adjusted gross profit margin $1,031,613 15.2 % $749,176 13.5 % $1,937,809 14.2 % $1,451,556 14.0 % Non-GAAP Reconciliations

 
Non-GAAP Reconciliations 23 Our adjusted operating margin is a non-GAAP financial measure calculated as operating income divided by adjusted gross profit. We believe adjusted operating margin is a useful measure of our profitability in comparison to our adjusted gross profit which we consider a primary performance metric as discussed above. The reconciliation of operating margin to adjusted operating margin is presented below: Three Months Ended June 30 Six Months Ended June 30 $ in thousands 2022 2021 2022 2021 Total Revenues $ 6,798,475 $ 5,532,726 $ 13,614,428 $ 10,336,595 Operating income 469,665 260,604 815,139 483,933 Operating margin 6.9 % 4.7 % 6.0 % 4.7 % Adjusted gross profit $ 1,031,613 $ 749,176 $ 1,937,809 $ 1,451,556 Operating income 469,665 260,604 815,139 483,933 Adjusted operating margin 45.5 % 34.8 % 42.1 % 33.3 %

 
24 Thank you INVESTOR RELATIONS: Chuck Ives 952-683-2508 [email protected]