C.H. Robinson Reports Fourth Quarter and Annual Results.MINNEAPOLIS -- C.H. Robinson Worldwide, Inc. ("C.H. Robinson") (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on :CHRW CHRW C.H. Robinson Worldwide (stock symbol) ), today reported financial results for the three months and twelve months ended December 31, 2006. Summarized financial results for the quarter and twelve months ended December 31 are as follows (dollars in thousands, except per share data): [TABLE OMITTED] Total Transportation gross profits increased 19.5 percent to $246.2 million in the fourth quarter of 2006 from $205.9 million in the fourth quarter of 2005. Our Transportation gross profit margin Gross profit margin Gross profit divided by sales, which is equal to each sales dollar left over after paying for the cost of goods sold. gross profit margin A measure calculated by dividing gross profit by net sales. increased to 18.3 percent in 2006 from 15.7 percent in 2005. The increase in our Transportation gross profit margin in the fourth quarter is due to an increase in our truck transportation gross profit margins and to a change in the mix of services that make up this business line. Our truck transportation gross profit margin expanded as overall market demand slowed and the truck capacity market loosened. We also had faster growth in our miscellaneous transportation management services business line, which has a higher gross profit margin than our overall Transportation business line. Our truck transportation gross profits increased 19.8 percent in the fourth quarter of 2006. Our growth was driven by both increased margins and increased volumes. While our volume growth was relatively consistent as the quarter progressed, our margins expanded through the quarter. Our intermodal gross profit increase of 11.1 percent in the fourth quarter of 2006 resulted from an increase in gross profit margins, offset in part by a decrease in volume. In our international freight forwarding business, our ocean gross profits increased 9.3 percent and our air gross profits increased 17.5 percent in the fourth quarter of 2006. Miscellaneous transportation gross profits consist primarily of transportation management fees, customs brokerage fees, and warehouse and cross-dock services. The increase of 43.4 percent in the fourth quarter was driven by increases in our transportation management fees and customs brokerage business. For the fourth quarter, Sourcing gross profits increased 7.5 percent to $21.8 million in 2006 from $20.3 million in 2005. This increase was due to higher volumes with retail and foodservice customers through integrated programs. Information Services See Information Systems. gross profits increased 7.0 percent to $10.5 million in the fourth quarter of 2006 from $9.9 million in the fourth quarter of 2005, due to transaction volume growth and an increase in pricing related to certain truck stop services. For the fourth quarter, operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. increased 17.2 percent to $168.1 million in 2006 from $143.5 million in 2005. This was due to an increase of 17.8 percent in personnel expenses and an increase of 15.4 percent in selling, general and administrative expenses. As a percentage of gross profits, operating expenses decreased to 60.4 percent in 2006 from 60.8 percent in 2005. This decrease was due to a decline in selling, general and administrative expenses as a percentage of gross profits from 14.3 percent to 14.0 percent. Founded in 1905, C.H. Robinson Worldwide, Inc., is one of the largest non-asset based third party logistics companies in the world. C.H. Robinson is a global provider of multimodal Two or more modes of operation. The term is used to refer to a myriad of functions and conditions in which two or more different methods, processes or forms of delivery are used. On the Web, it refers to asking for something one way and receiving the answer another; for example requesting transportation services and logistics solutions, currently serving over 25,000 customers through a network of 214 offices in North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. , South America South America, fourth largest continent (1991 est. pop. 299,150,000), c.6,880,000 sq mi (17,819,000 sq km), the southern of the two continents of the Western Hemisphere. , Europe, and Asia. C.H. Robinson maintains one of the largest networks of motor carrier capacity in North America and works with approximately 45,000 carriers worldwide. Except for the historical information contained herein, the matters set forth in this release are forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. 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 market demand and pressures on the pricing for our services; competition and growth rates Growth Rates The compounded annualized rate of growth of a company's revenues, earnings, dividends, or other figures. Notes: Remember, historically high growth rates don't always mean a high rate of growth looking into the future. within the third-party logistics A third-party logistics provider (abbreviated 3PL) is a firm that provides outsourced or "third party" logistics services to companies for part, or sometimes all of their supply chain management function. industry; freight levels and availability of truck capacity or alternative means of transporting See: mode of transport. freight, and changes in relationships with existing truck, rail, ocean and air carriers; changes in our customer base due to possible consolidation among our customers; our ability to integrate the operations of acquired companies with our historic operations successfully; risks associated with litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. and insurance coverage; risks associated with operations outside of the U.S.; risks associated with the produce industry, including food safety and contamination issues; changing economic conditions such as general economic slowdown, decreased consumer confidence, fuel shortages and the impact of war on the economy; and other risks and uncertainties detailed in our Annual and Quarterly Reports. Conference Call Information: C.H. Robinson Worldwide Fourth Quarter 2006 Earnings Conference Call Wednesday, January 31, 2007 10:00 a.m. Eastern time Live webcast available through Investor Relations Investor relations The process by which the corporation communicates with its investors. link at www.chrobinson.com Telephone access:800-218-0713 Webcast replay available through February 14, 2007; Investor Relations link at www.chrobinson.com Telephone audio replay available until 12:59 a.m. Eastern Time on February 3, 2007: 800-405-2236; passcode:11080688# [TABLE OMITTED] [TABLE OMITTED] [TABLE OMITTED] |
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