Form 8-K C H ROBINSON WORLDWIDE For: Jan 29

January 29, 2019 4:24 PM

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: January 29, 2019

(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		55347-5088
(Address of principal executive offices)		(Zip Code)

952-937-8500

Registrant’s telephone number, including area code

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))

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 C.H. Robinson Worldwide, Inc.'s announcement regarding its financial results for the quarter ended December 31, 2018 and its earnings conference call slides.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

Exhibit Index

99.1 Press Release dated January 29, 2019 of C.H. Robinson Worldwide, Inc.

99.2 Earnings conference call slides dated January 30, 2019

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: January 29, 2019



	C.H. Robinson 14701 Charlson Rd. Eden Prairie, MN 55347 www.chrobinson.com
	FOR INQUIRIES, CONTACT: Robert Houghton, VP of Investor Relations and Treasury Email: [email protected]

FOR IMMEDIATE RELEASE

C.H. Robinson Reports 2018 Fourth Quarter and Full-Year Results

MINNEAPOLIS, MN, January 29, 2019 - C.H. Robinson Worldwide, Inc. (“C.H. Robinson”) (NASDAQ: CHRW) today reported financial results for the quarter and fiscal year ended December 31, 2018.

Fourth Quarter Highlights:


•	Total revenues increased 4.5 percent to $4.1 billion


•	Net revenues increased 13.0 percent to $713.8 million


•	Income from operations increased 21.2 percent to $255.5 million


•	Diluted earnings per share (EPS) increased 24.0 percent to $1.34


•	Cash flow from operations increased 59.4 percent to $264.0 million

Full-Year Highlights:


•	Total revenues increased 11.8 percent to $16.6 billion


•	Net revenues increased 14.2 percent to $2.7 billion


•	Income from operations increased 17.7 percent to $912.1 million


•	Diluted EPS increased 32.5 percent to $4.73


•	Cash flow from operations increased 106.5 percent to $792.9 million

“We are pleased with our financial results in 2018. We achieved record levels of net revenues and operating income and a 100 basis point increase in operating income margin. Led by our strong operating performance, we more than doubled our cash flow from operations and returned nearly $600 million to shareholders in 2018,” said John Wiehoff, Chairman and Chief Executive Officer of C.H. Robinson. “Our strong 2018 financial results reflect the strength and hard work of our global network.”

Fourth Quarter Results Summary


•	Total revenues increased 4.5 percent to $4.1 billion, driven by growth across most transportation service lines.


•	Net revenues increased 13.0 percent to $713.8 million, driven by growth across all transportation service lines.

•

Operating expenses increased 8.9 percent to $458.3 million. Personnel expenses increased 8.9 percent to $339.3 million, driven primarily by higher variable compensation expense and a 1.4 percent increase in average headcount. Selling, general and administrative (“SG&A”) expenses increased 8.8 percent to $119.0 million, due primarily to increases in purchased services, occupancy and travel and entertainment.


•	Income from operations totaled $255.5 million, up 21.2 percent from last year due to growth in North American Surface Transportation (“NAST”), Global Forwarding and Robinson Fresh, partially offset by a decline in All Other and Corporate. Operating margin of 35.8 percent increased 240 basis points.


•	Interest and other expenses decreased by $8.0 million, driven primarily by a $2.4 million favorable impact from currency revaluation in the fourth quarter of 2018, versus a $6.2 million unfavorable impact in the year-ago period. This was partially offset by higher interest expense due to an increase in interest rates.


•	The effective tax rate in the quarter was 23.9 percent compared to 21.1 percent last year. The higher tax rate was driven primarily by one-time tax benefits that totaled $31.8 million in the year-ago period, partially offset by a $28.4 million benefit in the current period from the Tax Cuts and Jobs Act of 2017.


•	Net income totaled $187.2 million, up 22.7 percent from a year ago. Diluted EPS of $1.34 increased 24.0 percent.

Full-Year Results Summary


•	Total revenues increased 11.8 percent to $16.6 billion, driven by growth across all transportation service lines.


•	Net revenues increased 14.2 percent to $2.7 billion, driven by growth across all transportation service lines.


•	Income from operations totaled $912.1 million, up 17.7 percent from last year due primarily to growth in NAST and Robinson Fresh, partially offset by a decline in All Other and Corporate. Operating margin of 33.7 percent increased 100 basis points.


•	The effective tax rate for the full year was 24.5 percent compared to 30.7 percent last year, driven primarily by an $83.1 million benefit from the Tax Cuts and Jobs Act of 2017.


•	Net income totaled $664.5 million, up 31.6 percent from a year ago. Diluted EPS of $4.73 increased 32.5 percent.

North American Surface Transportation Results

Summarized financial results of our NAST segment are as follows (dollars in thousands):



	Three Months Ended December 31,						Twelve Months Ended December 31,
	2018		2017		% change		2018		2017		% change
Total revenues ⁽¹⁾	$	2,774,524	$	2,618,587	6.0	%	$	11,247,900	$	9,728,810	15.6	%
Net revenues	471,394		415,315		13.5	%	1,788,498		1,525,064		17.3	%
Income from operations	211,044		180,557		16.9	%	773,846		628,110		23.2	%

⁽¹⁾ Excludes intersegment revenues.

Fourth quarter total revenues for C.H. Robinson's NAST segment totaled $2.8 billion, an increase of 6.0 percent over the prior year, primarily driven by increased pricing. NAST net revenues increased 13.5 percent in the quarter to $471.4 million. Net revenues in truckload increased 13.0 percent, less than truckload (“LTL”) net revenues increased 11.5 percent, and intermodal net revenues increased 76.4 percent versus the year ago period, which included elevated repositioning charges. Excluding the impact of the change in fuel prices, our average North America truckload rate per mile charged to customers increased approximately 1.5 percent in the quarter, while our truckload transportation cost per mile decreased approximately 1 percent. Truckload volume declined 1.5 percent in the quarter. LTL volumes grew 2 percent, and intermodal volumes declined 13 percent versus the prior year. Operating expenses increased 10.9 percent, primarily due to increased variable compensation. Income from operations increased 16.9 percent to $211.0 million, and operating margin expanded 130 basis points to 44.8 percent in the quarter. NAST average headcount was up 1.3 percent in the quarter.

Global Forwarding Results

Summarized financial results of our Global Forwarding segment are as follows (dollars in thousands):



	Three Months Ended December 31,						Twelve Months Ended December 31,
	2018		2017		% change		2018		2017		% change
Total revenues ⁽¹⁾	$	677,125	$	591,245	14.5	%	$	2,487,744	$	2,140,987	16.2	%
Net revenues	142,737		127,869		11.6	%	543,906		485,280		12.1	%
Income from operations	29,782		16,836		76.9	%	91,626		91,842		(0.2	)%

⁽¹⁾ Excludes intersegment revenues.

Fourth quarter total revenues for the Global Forwarding segment increased 14.5 percent to $677.1 million, driven by improved pricing across all service lines and volume growth in ocean and customs. Net revenues increased 11.6 percent in the quarter to $142.7 million. Ocean net revenues increased 12.4 percent driven by higher volumes and pricing. Net revenues in air increased 9.3 percent, as the air service line benefited from a decreasing cost environment. Customs net revenues increased 12.4 percent, driven by higher volumes and pricing. Operating expenses increased 1.7 percent, primarily driven by higher variable compensation that was partially offset by a 0.4 percent decrease in average headcount. Income from operations increased 76.9 percent to $29.8 million, and operating margin expanded 770 basis points to 20.9 percent in the quarter.

Robinson Fresh Results

Summarized financial results of our Robinson Fresh segment are as follows (dollars in thousands):



	Three Months Ended December 31,						Twelve Months Ended December 31,
	2018		2017		% change		2018		2017		% change
Total revenues⁽¹⁾	$	531,817	$	594,646	(10.6	)%	$	2,268,900	$	2,415,740	(6.1	)%
Net revenues	64,299		54,123		18.8	%	234,046		226,059		3.5	%
Income from operations	19,785		12,887		53.5	%	59,735		53,374		11.9	%

⁽¹⁾ Excludes intersegment revenues.

Fourth quarter total revenues for the Robinson Fresh segment declined 10.6 percent to $531.8 million. Segment net revenues expanded 18.8 percent to $64.3 million in the quarter. Sourcing net revenues decreased 8.2 percent. Case volumes declined 6.5 percent, driven by lower restaurant traffic at our foodservice customers. Transportation net revenues increased 45.9 percent, primarily driven by truckload pricing increases. Robinson Fresh operating expenses increased 7.9 percent, driven by increased variable compensation expense, partially offset by a 5.1 percent reduction in average headcount. Income from operations increased 53.5 percent to $19.8 million, and operating margin expanded 700 basis points to 30.8 percent in the quarter.

All Other and Corporate Results

Net revenues for Managed Services and Other Surface Transportation are summarized as follows (dollars in thousands):



	Three Months Ended December 31,						Twelve Months Ended December 31,
Net revenues	2018		2017		% change		2018		2017		% change
Managed Services	$	20,318	$	18,322	10.9	%	$	78,789	$	72,166	9.2	%
Other Surface Transportation	15,035		16,220		(7.3	)%	59,996		59,481		0.9	%

Fourth quarter Managed Services net revenues increased 10.9 percent to $20.3 million, driven by a combination of selling additional service lines to existing customers and new customer wins. Other Surface Transportation net revenues decreased 7.3 percent to $15.0 million, driven by pricing declines in Europe.

Other Income Statement Items

The fourth quarter effective tax rate was 23.9 percent, up from 21.1 percent last year. The higher tax rate was driven primarily by one-time tax benefits that totaled $31.8 million in the year-ago period and was partially offset by a $28.4 million benefit in the current period from the Tax Cuts and Jobs Act of 2017. We expect our full-year effective tax rate to be between 24 and 25 percent in 2019.

Due to the adoption of ASU 2014-09 (“Revenue from Contracts with Customers”), in-transit shipments are now included in our financial results as of January 1, 2018. This new policy did not have a material impact on our overall operating results for the full year.

Interest and other expenses decreased by $8.0 million in the quarter driven primarily by a $2.4 million favorable impact from currency revaluation in the fourth quarter of 2018, versus a $6.2 million unfavorable impact in the year-ago period. This was partially offset by higher interest expense due to an increase in interest rates.

Diluted weighted average shares outstanding in the quarter were down 1.1 percent, as share repurchases were partially offset by activity in our equity compensation plans.

Cash Flow Generation and Capital Distribution

Fourth quarter cash from operations totaled $264.0 million, up 59.4 percent versus the prior year, primarily due to increased earnings and improved working capital performance versus the year-ago period.

In the fourth quarter, $168.4 million was returned to shareholders, with $70.0 million in cash dividends and $98.4 million in share repurchases. This represents an increase of 42.4 percent over the prior year.

Capital expenditures totaled $14.3 million in the quarter. We expect 2019 capital expenditures to be between $80 and $90 million, with the majority dedicated to technology.

Outlook

“As we turn to 2019, we are remain focused on top-line growth and operating margin expansion and believe our continued investments in technology will help enable us to achieve these objectives,” said John Wiehoff. “We are also committed to strong cash returns to shareholders.”

John added, “A critical part of our strategy is to make investments that add value for our customers and carriers and drive growth for our business, regardless of where we are in the freight cycle. I remain as confident as ever that we have the right people, processes and technology to continue to win in the marketplace.”

About C.H. Robinson

At C.H. Robinson, we believe in accelerating global trade to seamlessly deliver the products and goods that drive the world’s economy. Using the strengths of our knowledgeable people, proven processes, and global technology, we help our customers work smarter, not harder. As one of the world’s largest third-party logistics providers (3PL), we provide a broad portfolio of logistics services, fresh produce sourcing and managed services for more than 124,000 customers and 76,000 active contract carriers through our integrated network of offices and more than 15,000 employees. In addition, the company, our Foundation and our employees contribute millions of dollars annually to a variety of organizations. Headquartered in Eden Prairie, Minnesota, C.H. Robinson (CHRW) has been publicly traded since 1997. For more information, visit www.chrobinson.com.

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; economic recessions; changes in market demand and pressures on the pricing for our services; fuel prices and availability; changes in the availability of equipment and services from third party providers, including the availability of contracted truckload carriers and changes in prices; changes in political and governmental conditions domestically and internationally; catastrophic events such as environmental events or terrorist attacks; failure to retain employees; failure of any of our technology or operating systems, including due to data security breaches or hacking; competition and growth rates within the third party logistics industry; risks associated with our decentralized operations; seasonality in the transportation industry; risks associated with 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; risk of unexpected or unanticipated events or opportunities that might require additional capital expenditures; our dependence on our largest customers; risks associated with identifying suitable acquisitions and investments and with integrating acquired companies; risks associated with our long-term growth and profitability; 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 Fourth Quarter 2018 Earnings Conference Call

Wednesday, January 30, 2019; 8:30 a.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

Callers should reference the conference ID, which is 13685936

We invite call participants to submit questions in advance of the conference call, and we will respond to as many of the questions as we can in the time allowed. To submit your question(s) in advance of the call, please email [email protected].

Summarized Financial Results

($ in thousands, except per share data)



	Three Months Ended December 31,						Twelve Months Ended December 31,
	2018		2017		% change		2018		2017		% change
Total revenues	$	4,137,908	$	3,959,786	4.5	%	$	16,631,172	$	14,869,380	11.8	%
Net revenues:
Transportation
Truckload	$	395,611	$	342,134	15.6	%	$	1,445,916	$	1,229,999	17.6	%
LTL	117,326		105,306		11.4	%	471,275		407,012		15.8	%
Intermodal	8,595		5,867		46.5	%	32,469		29,145		11.4	%
Ocean	82,234		73,135		12.4	%	312,952		290,630		7.7	%
Air	30,761		27,595		11.5	%	120,540		100,761		19.6	%
Customs	23,761		21,142		12.4	%	88,515		70,952		24.8	%
Other logistics services	30,603		29,554		3.5	%	122,077		117,117		4.2	%
Total transportation	688,891		604,733		13.9	%	2,593,744		2,245,616		15.5	%
Sourcing	24,892		27,116		(8.2	)%	111,491		122,434		(8.9	)%
Total net revenues	713,783		631,849		13.0	%	2,705,235		2,368,050		14.2	%

Operating expenses	458,266		420,973		8.9	%	1,793,152		1,592,931		12.6	%
Income from operations	255,517		210,876		21.2	%	912,083		775,119		17.7	%
Net income	$	187,150	$	152,556	22.7	%	$	664,505	$	504,893	31.6	%
Diluted EPS	$	1.34	$	1.08	24.0	%	$	4.73	$	3.57	32.5	%

This table of summary results presents our service line net revenues consistent with our historical presentation and is on an enterprise basis. The service line net revenues in the table differ from the service line net revenues discussed within the segments as our segments have revenues from multiple service lines.

Condensed Consolidated Statements of Income

(unaudited, in thousands, except per share data)



	Three Months Ended December 31,						Twelve Months Ended December 31,
	Three Months Ended December 31,						Twelve Months Ended December 31,
	2018			2017			2018			2017

Revenues:
Transportation	$	3,896,750		$	3,647,167		$	15,515,921		$	13,502,906
Sourcing	241,158			312,619			1,115,251			1,366,474
Total revenues	4,137,908			3,959,786			16,631,172			14,869,380
Costs and expenses:
Purchased transportation and related services	3,207,859			3,042,434			12,922,177			11,257,290
Purchased products sourced for resale	216,266			285,503			1,003,760			1,244,040
Personnel expenses	339,316			311,599			1,343,542			1,179,527
Other selling, general, and administrative expenses	118,950			109,374			449,610			413,404
Total costs and expenses	3,882,391			3,748,910			15,719,089			14,094,261
Income from operations	255,517			210,876			912,083			775,119
Interest and other expense	(9,456		)	(17,502		)	(31,810		)	(46,656		)
Income before provision for income taxes	246,061			193,374			880,273			728,463
Provisions for income taxes	58,911			40,818			215,768			223,570
Net income	$	187,150		$	152,556		$	664,505		$	504,893

Net income per share (basic)	$	1.36		$	1.09		$	4.78		$	3.59
Net income per share (diluted)	$	1.34		$	1.08		$	4.73		$	3.57

Weighted average shares outstanding (basic)	137,797			139,572			139,010			140,610
Weighted average shares outstanding (diluted)	139,182			140,724			140,405			141,382

Business Segment Information

(unaudited, dollars in thousands)



	NAST		Global Forwarding		Robinson Fresh		All Other and Corporate			Eliminations			Consolidated
Three Months Ended December 31, 2018
Revenues	$	2,774,524	$	677,125	$	531,817	$	154,442		$	—		$	4,137,908
Intersegment revenues ⁽¹⁾	139,211		11,478		56,384		7,005			(214,078		)	—
Total revenues	2,913,735		688,603		588,201		161,447			(214,078		)	4,137,908
Net revenues	471,394		142,737		64,299		35,353			—			713,783
Income from operations	211,044		29,782		19,785		(5,094		)	—			255,517
Depreciation and amortization	6,196		8,751		1,097		8,283			—			24,327
Total assets	2,345,455		969,736		401,561		710,660			—			4,427,412
Average headcount	6,964		4,664		887		2,728			—			15,243

	NAST		Global Forwarding		Robinson Fresh		All Other and Corporate			Eliminations			Consolidated
Three Months Ended December 31, 2017
Revenues	$	2,618,587	$	591,245	$	594,646	$	155,308		$	—		$	3,959,786
Intersegment revenues ⁽¹⁾	133,197		6,742		51,011		4,398			(195,348		)	—
Total revenues	2,751,784		597,987		645,657		159,706			(195,348		)	3,959,786
Net revenues	415,315		127,869		54,123		34,542			—			631,849
Income from operations	180,557		16,836		12,887		596			—			210,876
Depreciation and amortization	6,126		8,734		1,196		7,581			—			23,637
Total assets	2,277,252		821,182		434,080		703,320			—			4,235,834
Average headcount	6,878		4,683		935		2,540			—			15,036

(1) Intersegment revenues represent the sales between our segments and are eliminated to reconcile to our consolidated results.

Business Segment Information

(unaudited, dollars in thousands)



	NAST		Global Forwarding		Robinson Fresh		All Other and Corporate			Eliminations			Consolidated
Twelve Months Ended December 31, 2018
Revenues	$	11,247,900	$	2,487,744	$	2,268,900	$	626,628		$	—		$	16,631,172
Intersegment revenues ⁽¹⁾	545,177		48,343		211,286		20,951			(825,757		)	—
Total revenues	11,793,077		2,536,087		2,480,186		647,579			(825,757		)	16,631,172
Net revenues	1,788,498		543,906		234,046		138,785			—			2,705,235
Income from operations	773,846		91,626		59,735		(13,124		)	—			912,083
Depreciation and amortization	24,510		35,148		4,506		32,565			—			96,729
Total assets	2,345,455		969,736		401,561		710,660			—			4,427,412
Average headcount	6,938		4,711		903		2,652			—			15,204

	NAST		Global Forwarding		Robinson Fresh		All Other and Corporate			Eliminations			Consolidated
Twelve Months Ended December 31, 2017
Revenues	$	9,728,810	$	2,140,987	$	2,415,740	$	583,843		$	—		$	14,869,380
Intersegment revenues ⁽¹⁾	462,390		30,198		167,292		18,174			(678,054		)	—
Total revenues	10,191,200		2,171,185		2,583,032		602,017			(678,054		)	14,869,380
Net revenues	1,525,064		485,280		226,059		131,647			—			2,368,050
Income from operations	628,110		91,842		53,374		1,793			—			775,119
Depreciation and amortization	23,230		33,308		4,730		31,709			—			92,977
Total assets	2,277,252		821,182		434,080		703,320			—			4,235,834
Average headcount	6,907		4,310		957		2,513			—			14,687

(1) Intersegment revenues represent the sales between our segments and are eliminated to reconcile to our consolidated results.

Condensed Consolidated Balance Sheets

(unaudited, in thousands)



	December 31, 2018		December 31, 2017
Assets
Current assets:
Cash and cash equivalents	$	378,615	$	333,890
Receivables, net	2,162,438		2,113,930
Contract assets	159,635		—
Other current assets	52,386		63,116
Total current assets	2,753,074		2,510,936

Property and equipment, net	228,301		230,326
Intangible and other assets	1,446,037		1,494,572
Total assets	$	4,427,412	$	4,235,834

Liabilities and stockholders’ investment
Current liabilities:
Accounts payable and outstanding checks	$	1,063,107	$	1,096,664
Accrued expenses:
Compensation	153,626		105,316
Transportation expense	119,820		—
Income taxes	28,360		12,240
Other accrued liabilities	63,410		58,229
Current portion of debt	5,000		715,000
Total current liabilities	1,433,323		1,987,449

Long term debt	1,341,352		750,000
Noncurrent income taxes payable	21,463		26,684
Deferred tax liability	35,757		45,355
Other long-term liabilities	430		601
Total liabilities	2,832,325		2,810,089

Total stockholders’ investment	1,595,087		1,425,745
Total liabilities and stockholders’ investment	$	4,427,412	$	4,235,834

Condensed Consolidated Statements of Cash Flow

(unaudited, in thousands, except operational data)



	Twelve Months Ended December 31,
	2018			2017
Operating activities:
Net income	$	664,505		$	504,893
Depreciation and amortization	96,729			92,977
Provision for doubtful accounts	15,634			13,489
Stock-based compensation	87,791			41,805
Deferred income taxes	(15,315		)	(28,096		)
Excess tax benefit on stock-based compensation	(10,388		)	(13,657		)
Other	1,815			4,491
Changes in operating elements, net of acquisitions:
Receivables	(190,048		)	(364,181		)
Contract assets	(11,871		)	—
Prepaid expenses and other	16,029			(9,173		)
Other non-current assets and liabilities	1,370			(19,099		)
Accounts payable and outstanding checks	36,083			144,041
Accrued compensation	47,011			7,209
Accrued transportation expenses	25,175			—
Accrued income taxes	21,176			18,817
Other accrued liabilities	7,200			(9,515		)
Net cash provided by operating activities	792,896			384,001

Investing activities:
Purchases of property and equipment	(45,000		)	(40,122		)
Purchases and development of software	(18,871		)	(17,823		)
Acquisitions, net of cash acquired	(5,315		)	(49,068		)
Other	(3,622		)	(521		)
Net cash used for investing activities	(72,808		)	(107,534		)

Financing activities:
Proceeds from stock issued for employee benefit plans	51,285			38,130
Net repurchases of common stock	(322,255		)	(207,042		)
Cash dividends	(265,219		)	(258,222		)
Proceeds from long-term borrowings	591,012			250,000
Proceeds from short-term borrowings	2,674,000			8,784,000
Payments on short-term borrowings	(3,384,000		)	(8,809,000		)
Net cash used for financing activities	(655,177		)	(202,134		)
Effect of exchange rates on cash	(20,186		)	11,891

Net change in cash and cash equivalents	44,725			86,224
Cash and cash equivalents, beginning of period	333,890			247,666
Cash and cash equivalents, end of period	$	378,615		$	333,890

	As of December 31,
Operational Data:	2018			2017
Employees	15,262			15,074

Source: C.H. Robinson

CHRW-IR

Earnings Conference Call – Fourth Quarter 2018 January 30, 2019 John Wiehoff, Chairman & CEO Andrew Clarke, CFO Robert Biesterfeld, COO Robert Houghton, VP of Investor Relations 1

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; economic recessions; changes in market demand and pressures on the pricing for our services; fuel prices and availability; changes in the availability of equipment and services from third party providers, including the availability of contracted truckload carriers and changes in prices; changes in political and governmental conditions domestically and internationally; catastrophic events such as environmental events or terrorist attacks; failure to retain employees; failure of any of our technology or operating systems, including due to data security breaches or hacking; competition and growth rates within the third party logistics industry; risks associated with our decentralized operations; seasonality in the transportation industry; risks associated with 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; risk of unexpected or unanticipated events or opportunities that might require additional capital expenditures; our dependence on our largest customers; risks associated with identifying suitable acquisitions and investments and with integrating acquired companies; risks associated with our long-term growth and profitability; and other risks and uncertainties detailed in our Annual and Quarterly Reports. 2 2

Q4 2018 – Key Themes ▪ Strength of the business model is our ability to rebalance our portfolio ▪ Continued investment through the freight cycle ▪ Excellent fourth quarter and full-year financial performance 3 3

Results Q4 2018 in thousands, except per share amounts and headcount Three Months Ended December 31 2018 2017 % Change Total Revenues $4,137,908 $3,959,786 4.5% Total Net Revenues $713,783 $631,849 13.0% Net Revenue Margin % 17.2% 16.0% 120 bps Personnel Expenses $339,316 $311,599 8.9% Selling, General, and Admin $118,950 $109,374 8.8% Income from Operations $255,517 $210,876 21.2% Operating Margin % 35.8% 33.4% 240 bps Depreciation and Amortization $24,327 $23,637 2.9% Net Income $187,150 $152,556 22.7% Earnings Per Share (Diluted) $1.34 $1.08 24.0% Average Headcount 15,243 15,036 1.4% ▪ Net revenues increase driven primarily by higher pricing ▪ Operating income growth includes increased variable compensation expense and moderating headcount growth 4 4

Q4 2018 Other Income Statement Items ▪ Q4 effective tax rate of 23.9% vs. 21.1% last year ▪ $28.4 million favorable impact of U.S. corporate tax reform in the quarter ▪ Year-ago period included one-time tax benefits totaling $31.8 million ▪ $2.4 million favorable impact from currency revaluation ▪ Interest expense increase due to an increase in interest rates ▪ Weighted average diluted shares outstanding down 1.1 percent ‹#› 5

2018 Cash Flow Q4 Cash Flow from Operations FY 2018 Cash Flow from Operations + 59.4% + 106.5% $792.9M $264.0M $165.7M $384.0M Q4 2017 Q4 2018 FY 2017 FY 2018 ▪ $98.3 million increase in cash flow ▪ $408.9 million increase in cash flow driven by higher net income and driven by higher net income and improved working capital performance improved working capital ▪ $14.3 million in capital expenditures performance ▪ $63.9 million in capital expenditures ▪ Expect $80-90 million in capital expenditures in 2019 ‹#› 6 ▪ Dividend payout ratio of 40.9%

2018 Capital Distribution Q4 Capital Distribution FY 2018 Capital Distribution + 42.4% + 28.3% $168.4M $590.1M $459.8M $118.3M Share Repurchases Cash Dividends Q4 2017 Q4 2018 YTD 2017 YTD 2018 ▪ $168.4 million of net income returned ▪ $590.1 million of net income to shareholders returned to shareholders ▪ $70.0 million in cash dividends ▪ $265.2 million cash dividends ▪ $98.4 million in share repurchases ▪ $324.9 million in share ▪ 1,094,424 shares repurchased repurchases in the fourth quarter at an average price of $89.78 per share ‹#› 7 ▪ Dividend payout ratio of 40.9%

Q4 2018 Balance Sheet in thousands December 31, December 31, 2018 2017 % Change Accounts Receivable, Net $2,162,438 $2,113,930 Contract Assets(1) $159,635 — Accounts Payable and O/S Checks $1,063,107 $1,096,664 Accrued Transportation Expense(1) $119,820 — Net Operating Working Capital(2) $1,139,146 $1,017,266 12.0% ▪ Total debt balance $1.35 billion ▪ $600 million senior unsecured notes, 4.20% coupon ▪ $500 million private placement debt, 4.28% average coupon ▪ $250 million accounts receivable securitization debt facility, 3.17% average rate ▪ $5 million drawn on credit facility, 3.41% average rate (1) Balance sheet as of December 31, 2018, includes contract assets and accrued transportation expense as the result of an accounting policy change that recognizes revenues for in-transit shipments. (2) Net operating working capital is defined as net accounts receivable and contract assets less accounts payable, outstanding checks and accrued transportation expense. ‹#› 8

Results FY 2018 in thousands, except per share amounts and headcount Twelve Months Ended December 31 2018 2017 % Change Total Revenues $16,631,172 $14,869,380 11.8% Total Net Revenues $2,705,235 $2,368,050 14.2% Net Revenue Margin % 16.3% 15.9% 40 bps Personnel Expenses $1,343,542 $1,179,527 13.9% Selling, General, and Admin $449,610 $413,404 8.8% Income from Operations $912,083 $775,119 17.7% Operating Margin % 33.7% 32.7% 100 bps Depreciation and Amortization $96,729 $92,977 4.0% Net Income $664,505 $504,893 31.6% Earnings Per Share (Diluted) $4.73 $3.57 32.5% Average Headcount 15,204 14,687 3.5% ▪ Net revenues increase driven primarily by higher pricing ▪ Operating income growth includes increased variable compensation expense and modest headcount growth ▪ Net income and earnings per share increases include an $83.1 million favorable impact of U.S. corporate tax reform 9 9

First Quarter 2019 Trends – January ▪ January to date total company net revenue per business day has increased approximately 9 percent when compared to January 2018 ▪ Truckload volume per business day has increased approximately 3 percent on a year-over-year basis in January 10 10

North America Truckload Cost and Price Change(1) TRANSPORTATION NET REVENUE MARGIN 23% 20% E C I R 21% P 15% D N A 10% 19% T S O C 5% N 17% I E 0% G N 15% A H -5% C YoY Price Change % 13% Y -10% YoY Cost Change O Y Transportation Net Revenue Margin -15% 11% 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 North America Q4 ▪ North America Truckload cost and price change chart Truckload represents truckload shipments from all North America Volume (2.5%) segments. Transportation net revenue margin represents total Transportation results from all segments. Price 1.5% Cost (1.0%) Net Revenue Margin (1) Cost and price change exclude the estimated impact of fuel. ‹#› 11

North America Truckload Cost and Price Per Mile(1) Price per Mile Cost per Mile ▪ North America Truckload cost and price per mile chart represents truckload shipments from all North America segments ▪ 2018 fourth quarter cost and price per mile remain above historical average levels ▪ Continued price movements in response to changes in marketplace conditions (1) Cost and price per mile exclude the estimated impact of fuel. ‹#› 12

Q4 2018 NAST Results by Service Line Truckload, Less Than Truckload and Intermodal in thousands Three Months Ended December 31 Net Revenues 2018 2017 % Change ▪ Year-over-year price Truckload $343,978 $304,525 13.0% increases in truckload, LTL LTL $112,110 $100,529 11.5% and intermodal Intermodal $8,253 $4,679 76.4% Other $7,053 $5,582 26.4% ▪ Net revenue margin Total $471,394 $415,315 13.5% expansion in truckload, LTL and intermodal ▪ Volume increase in LTL Truckload LTL Intermodal Pricing(1)(2) 1.5% ▪ Added 4,800 new carriers Cost(1)(2) (1.0%) in the quarter Volume (1.5%) 2.0% (13.0%) Net Revenue Margin (1) Represents price and cost YoY change for North America shipments across all segments. (2) Pricing and cost measures exclude the estimated impact of the change in fuel prices. ‹#› 13

Q4 2018 NAST Operating Income Q4 Operating Income Q4 Operating Margin % + 16.9% + 130 bps $211.0M 44.8% $180.6M 43.5% Q4 2017 Q4 2018 Q4 2017 Q4 2018 ▪ Increased net revenues ▪ Progress against productivity initiatives ▪ Headcount increased approximately 1 percent ‹#› 14

Q4 2018 Global Forwarding Results by Service Line Ocean, Air and Customs in thousands Three Months Ended December 31 ▪ Volume increases in ocean and customs Net Revenues 2018 2017 % Change Ocean $82,113 $73,069 12.4% ▪ Improved ocean net Air $28,051 $25,668 9.3% revenues due to pricing Customs $23,762 $21,145 12.4% reflective of market Other $8,811 $7,987 10.3% conditions Total $142,737 $127,869 11.6% ▪ Air net revenue growth due to improved customer mix Ocean Air Pricing ▪ Customs net revenues reflect Volume organic growth Net Revenue Margin ‹#› 15

Q4 2018 Global Forwarding Operating Income Q4 Operating Income Q4 Operating Margin % + 76.9% + 770 bps $29.8M 20.9% $16.8M 13.2% Q4 2017 Q4 2018 Q4 2017 Q4 2018 ▪ Increased net revenues ▪ Improved employee productivity ▪ 0.4 percent decrease in average headcount ‹#› 16

Q4 2018 Robinson Fresh Results Transportation and Sourcing in thousands Three Months Ended December 31 ▪ Sourcing case volume Sourcing 2018 2017 % Change declined 6.5 percent Total Revenues(1) $241,158 $312,619 (22.9%) Net Revenues $24,892 $27,116 (8.2%) ▪ Truckload volume Net Revenue Margin % 10.3% 8.7% 160 bps decline of 12.5 percent Transportation 2018 2017 % Change ▪ Pricing reflective of Total Revenues(1) $290,659 $282,027 3.1% marketplace conditions Truckload $32,098 $19,848 61.7% in Transportation Other $7,309 $7,159 2.1% Net Revenues $39,407 $27,007 45.9% Net Revenue Margin % 13.6% 9.6% 400 bps (1) Does not include intersegment revenues. ‹#› 17

Q4 2018 Robinson Fresh Operating Income Q4 Operating Income Q4 Operating Margin % + 53.5% + 700 bps $19.8M 30.8% $12.9M 23.8% Q4 2017 Q4 2018 Q4 2017 Q4 2018 ▪ Increased transportation net revenues ▪ Continued operating expense reduction initiatives ▪ 5.1 percent reduction in average headcount ‹#› 18

Q4 2018 All Other and Corporate Results Managed Services and Other Surface Transportation in thousands Three Months Ended December 31 Net Revenues 2018 2017 % Change Managed Services $20,318 $18,322 10.9% Other Surface Transportation $15,035 $16,220 (7.3%) Total $35,353 $34,542 2.3% Managed Services ▪ $4 billion in freight under management in 2018 Europe Surface Transportation ▪ Mid-single-digit volume growth ‹#› 19

Final Comments ▪ Evidence of a balanced freight market ▪ Expect economic growth to continue ▪ Investing for future growth ‹#› 20

Appendix 21

Q4 2018 Transportation Results(1) in thousands Three Months Ended December 31 Twelve Months Ended December 31 Transportation 2018 2017 % Change 2018 2017 % Change Total Revenues $3,896,750 $3,647,167 6.8% $15,515,921 $13,502,906 14.9% Total Net Revenues $688,891 $604,733 13.9% $2,593,744 $2,245,616 15.5% Net Revenue Margin % 17.7% 16.6% 110 bps 16.7% 16.6% 10 bps Transportation Net Revenue Margin % 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Q1 22.6% 17.4% 17.2% 16.9% 16.3% 15.3% 16.8% 19.7% 17.3% 16.4% Q2 20.6% 15.8% 16.2% 14.9% 15.4% 16.0% 17.5% 19.3% 16.2% 16.2% Q3 19.8% 16.6% 16.4% 15.6% 15.0% 16.2% 18.4% 17.6% 16.4% 16.6% Q4 18.3% 17.6% 16.3% 15.8% 15.1% 15.9% 19.0% 17.2% 16.6% 17.7% Total 20.2% 16.8% 16.5% 15.8% 15.4% 15.9% 17.9% 18.4% 16.6% 16.7% (1) Includes results across all segments. ‹#› 22

Q4 2018 NAST Results in thousands, except headcount Three Months Ended December 31 Twelve Months Ended December 31 2018 2017 % Change 2018 2017 % Change Total Revenues(1) $2,774,524 $2,618,587 6.0% $11,247,900 $9,728,810 15.6% Total Net Revenues $471,394 $415,315 13.5% $1,788,498 $1,525,064 17.3% Net Revenue Margin % 17.0% 15.9% 110 bps 15.9% 15.7% 20 bps Income from Operations $211,044 $180,557 16.9% $773,846 $628,110 23.2% Operating Margin % 44.8% 43.5% 130 bps 43.3% 41.2% 210 bps Depreciation and Amortization $6,196 $6,126 1.1% $24,510 $23,230 5.5% Total Assets $2,345,455 $2,277,252 3.0% $2,345,455 $2,277,252 3.0% Average Headcount 6,964 6,878 1.3% 6,938 6,907 0.4% (1) Does not include intersegment revenues. ‹#› 23

Q4 2018 Global Forwarding Results in thousands, except headcount Three Months Ended December 31 Twelve Months Ended December 31 2018 2017 % Change 2018 2017 % Change Total Revenues(1) $677,125 $591,245 14.5% $2,487,744 $2,140,987 16.2% Total Net Revenues $142,737 $127,869 11.6% $543,906 $485,280 12.1% Net Revenue Margin % 21.1% 21.6% (50 bps) 21.9% 22.7% (80 bps) Income from Operations $29,782 $16,836 76.9% $91,626 $91,842 (0.2%) Operating Margin % 20.9% 13.2% 770 bps 16.8% 18.9% (210 bps) Depreciation and Amortization $8,751 $8,734 0.2% $35,148 $33,308 5.5% Total Assets $969,736 $821,182 18.1% $969,736 $821,182 18.1% Average Headcount 4,664 4,683 (0.4%) 4,711 4,310 9.3% (1) Does not include intersegment revenues. ‹#› 24

Q4 2018 Robinson Fresh Results in thousands, except headcount Three Months Ended December 31 Twelve Months Ended December 31 2018 2017 % Change 2018 2017 % Change Total Revenues(1) $531,817 $594,646 (10.6%) $2,268,900 $2,415,740 (6.1%) Total Net Revenues $64,299 $54,123 18.8% $234,046 $226,059 3.5% Net Revenue Margin % 12.1% 9.1% 300 bps 10.3% 9.4% 90 bps Income from Operations $19,785 $12,887 53.5% $59,735 $53,374 11.9% Operating Margin % 30.8% 23.8% 700 bps 25.5% 23.6% 190 bps Depreciation and Amortization $1,097 $1,196 (8.3%) $4,506 $4,730 (4.7%) Total Assets $401,561 $434,080 (7.5%) $401,561 $434,080 (7.5%) Average Headcount 887 935 (5.1%) 903 957 (5.6%) (1) Does not include intersegment revenues. ‹#› 25

Q4 2018 All Other and Corporate Results in thousands, except headcount Three Months Ended December 31 Twelve Months Ended December 31 2018 2017 % Change 2018 2017 % Change Total Revenues(1) $154,442 $155,308 (0.6%) $626,628 $583,843 7.3% Total Net Revenues $35,353 $34,542 2.3% $138,785 $131,647 5.4% Income from Operations ($5,094) $596 NM ($13,124) $1,793 NM Depreciation and Amortization $8,283 $7,581 9.3% $32,565 $31,709 2.7% Total Assets $710,660 $703,320 1.0% $710,660 $703,320 1.0% Average Headcount 2,728 2,540 7.4% 2,652 2,513 5.5% (1) Does not include intersegment revenues. ‹#› 26

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