C H ROBINSON WORLDWIDE INC, 10-K filed on 3/1/2013
Annual Report
Document and Entity Information (USD $)
12 Months Ended
Dec. 31, 2012
Feb. 22, 2013
Jun. 29, 2012
Document Documentand Entity Information [Abstract]
 
 
 
Document Type
10-K 
 
 
Amendment Flag
false 
 
 
Document Period End Date
Dec. 31, 2012 
 
 
Document Fiscal Year Focus
2012 
 
 
Document Fiscal Period Focus
FY 
 
 
Trading Symbol
CHRW 
 
 
Entity Registrant Name
C H ROBINSON WORLDWIDE INC 
 
 
Entity Central Index Key
0001043277 
 
 
Current Fiscal Year End Date
--12-31 
 
 
Entity Well-known Seasoned Issuer
Yes 
 
 
Entity Current Reporting Status
Yes 
 
 
Entity Voluntary Filers
No 
 
 
Entity Filer Category
Large Accelerated Filer 
 
 
Entity Common Stock, Shares Outstanding
 
161,053,942 
 
Entity Public Float
 
 
$ 9,330,323,899 
CONSOLIDATED BALANCE SHEETS (USD $)
In Thousands, unless otherwise specified
Dec. 31, 2012
Dec. 31, 2011
Current assets:
 
 
Cash and cash equivalents
$ 210,019 
$ 373,669 
Receivables, net of allowance for doubtful accounts of $34,560 and $31,328
1,412,136 
1,189,637 
Deferred tax asset
11,780 
8,382 
Prepaid expenses and other
38,355 
39,855 
Total current assets
1,672,290 
1,611,543 
Property and equipment
265,007 
220,073 
Accumulated depreciation and amortization
(115,156)
(93,243)
Net property and equipment
149,851 
126,830 
Goodwill
822,215 
359,688 
Other intangible assets, net of accumulated amortization of $14,108 and $9,708
137,411 
10,029 
Other assets
22,458 
29,951 
Total assets
2,804,225 
2,138,041 
Current liabilities:
 
 
Accounts payable
639,460 
642,672 
Outstanding checks
68,016 
62,062 
Accrued expenses –
 
 
Compensation and profit-sharing contribution
103,343 
117,541 
Income taxes
121,581 
4,456 
Other accrued liabilities
46,171 
49,901 
Current portion of debt
253,646 
0 
Total current liabilities
1,232,217 
876,632 
Noncurrent income taxes payable
20,590 
10,501 
Deferred tax liabilities
45,113 
842 
Other long term liabilities
1,933 
1,592 
Total liabilities
1,299,853 
889,567 
Commitments and contingencies
   
   
Stockholders’ investment:
 
 
Preferred stock, $ .10 par value, 20,000 shares authorized; no shares issued or outstanding
0 
0 
Common stock, $ .10 par value, 480,000 shares authorized; 178,695 and 177,312 shares issued, 161,327 and 163,441 outstanding
16,133 
16,344 
Additional paid-in capital
303,479 
205,794 
Retained earnings
2,218,229 
1,845,032 
Accumulated other comprehensive loss
(9,345)
(9,115)
Treasury stock at cost (17,368 and 13,871 shares)
(1,024,124)
(809,581)
Total stockholders’ investment
1,504,372 
1,248,474 
Total liabilities and stockholders’ investment
$ 2,804,225 
$ 2,138,041 
CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $)
In Thousands, except Share data, unless otherwise specified
Dec. 31, 2012
Dec. 31, 2011
Statement of Financial Position [Abstract]
 
 
Receivables, allowance for doubtful accounts
$ 34,560 
$ 31,328 
Other intangible assets, accumulated amortization
$ 14,108 
$ 9,708 
Preferred stock, par value
$ 0.10 
$ 0.10 
Preferred stock, shares authorized
20,000,000 
20,000,000 
Preferred stock, shares issued
0 
0 
Preferred stock, shares outstanding
0 
0 
Common stock, par value
$ 0.10 
$ 0.10 
Common stock, shares authorized
480,000,000 
480,000,000 
Common stock, shares issued
178,695,000 
177,312,000 
Common stock, shares outstanding
161,327,000 
163,441,000 
Treasury stock, shares
17,368,000 
13,871,000 
CONSOLIDATED STATEMENTS OF OPERATIONS CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (USD $)
In Thousands, except Per Share data, unless otherwise specified
12 Months Ended
Dec. 31, 2012
Dec. 31, 2011
Dec. 31, 2010
Revenues:
 
 
 
Transportation
$ 9,685,415 
$ 8,740,524 
$ 7,575,659 
Sourcing
1,620,183 
1,535,528 
1,643,174 
Payment Services
53,515 
60,294 
55,472 
Total revenues
11,359,113 
10,336,346 
9,274,305 
Costs and expenses:
 
 
 
Purchased transportation and related services
8,157,278 
7,296,608 
6,302,530 
Purchased products sourced for resale
1,483,745 
1,407,080 
1,503,797 
Purchased payment services
519 
0 
0 
Personnel expenses
766,006 
696,233 
632,064 
Other selling, general, and administrative expenses
276,245 
243,695 
213,054 
Total costs and expenses
10,683,793 
9,643,616 
8,651,445 
Income from operations
675,320 
692,730 
622,860 
Investment and other income
283,142 
1,974 
1,242 
Income before provision for income taxes
958,462 
694,704 
624,102 
Provision for income taxes
364,658 
263,092 
237,076 
Net income
593,804 
431,612 
387,026 
Other comprehensive loss
(230)
(2,690)
(4,789)
Comprehensive income
$ 593,574 
$ 428,922 
$ 382,237 
Basic net income per share (in dollars per share)
$ 3.68 
$ 2.63 
$ 2.35 
Diluted net income per share (in dollars per share)
$ 3.67 
$ 2.62 
$ 2.33 
Basic weighted average shares outstanding
161,557 
164,114 
164,909 
Dilutive effect of outstanding stock awards
389 
627 
1,063 
Diluted weighted average shares outstanding
161,946 
164,741 
165,972 
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' INVESTMENT (USD $)
In Thousands, except Share data, unless otherwise specified
3 Months Ended 12 Months Ended
Dec. 31, 2012
Mar. 31, 2012
Dec. 31, 2011
Mar. 31, 2011
Dec. 31, 2012
Dec. 31, 2011
Dec. 31, 2010
Increase (Decrease) in Stockholders' Equity [Roll Forward]
 
 
 
 
 
 
 
Beginning Balance
 
$ 1,248,474 
 
$ 1,204,068 
$ 1,248,474 
$ 1,204,068 
$ 1,079,900 
Net income
256,392 1
106,500 
109,214 
97,028 
593,804 
431,612 
387,026 
Foreign currency translation adjustment
 
 
 
 
(230)
(2,690)
(4,774)
Unrealized gain on available-for-sale securities
 
 
 
 
 
 
(15)
Dividends declared, $1.34 in 2012,$1.20 in 2011 and $1.04 in 2010 per share
 
 
 
 
(220,607)
(200,492)
(175,420)
Stock issued for acquisition
 
 
 
 
60,152 
 
 
Stock issued for employee benefit plans
 
 
 
 
8,086 
9,596 
17,733 
Issuance of restricted stock
 
 
 
 
0 
 
 
Stock-based compensation expense
 
 
 
 
59,463 
38,060 
37,583 
Excess tax benefit on deferred compensation and employee stock plans
 
 
 
 
12,294 
15,255 
13,092 
Repurchase of common stock
 
 
 
 
(257,064)
(246,935)
(151,057)
Ending Balance
1,504,372 
 
1,248,474 
 
1,504,372 
1,248,474 
1,204,068 
Common Stock
 
 
 
 
 
 
 
Increase (Decrease) in Stockholders' Equity [Roll Forward]
 
 
 
 
 
 
 
Beginning Balance (in shares)
 
163,441,000 
 
166,048,000 
163,441,000 
166,048,000 
167,098,000 
Beginning Balance
 
16,344 
 
16,605 
16,344 
16,605 
16,710 
Stock issued for acquisition (in shares)
 
 
 
 
1,108,000 
 
 
Stock issued for acquisition
 
 
 
 
111 
 
 
Stock issued for employee benefit plans (in shares)
 
 
 
 
712,000 
673,000 
1,065,000 
Stock issued for employee benefit plans
 
 
 
 
71 
67 
106 
Issuance of restricted stock (in shares)
 
 
 
 
276,000 
244,000 
376,000 
Issuance of restricted stock
 
 
 
 
28 
24 
38 
Stock-based compensation expense (in shares)
 
 
 
 
28,000 
16,000 
19,000 
Stock-based compensation expense
 
 
 
 
3 
2 
2 
Repurchase of common stock (in shares)
 
 
 
 
(4,238,000)
(3,540,000)
(2,510,000)
Repurchase of common stock
 
 
 
 
(424)
(354)
(251)
Ending Balance (in shares)
161,327,000 
 
163,441,000 
 
161,327,000 
163,441,000 
166,048,000 
Ending Balance
16,133 
 
16,344 
 
16,133 
16,344 
16,605 
Additional Paid-in Capital
 
 
 
 
 
 
 
Increase (Decrease) in Stockholders' Equity [Roll Forward]
 
 
 
 
 
 
 
Beginning Balance
 
205,794 
 
178,087 
205,794 
178,087 
165,104 
Stock issued for acquisition
 
 
 
 
60,041 
 
 
Stock issued for employee benefit plans
 
 
 
 
(32,435)
(24,717)
(36,681)
Issuance of restricted stock
 
 
 
 
(28)
(24)
(38)
Stock-based compensation expense
 
 
 
 
57,813 
37,193 
36,610 
Excess tax benefit on deferred compensation and employee stock plans
 
 
 
 
12,294 
15,255 
13,092 
Ending Balance
303,479 
 
205,794 
 
303,479 
205,794 
178,087 
Retained Earnings
 
 
 
 
 
 
 
Increase (Decrease) in Stockholders' Equity [Roll Forward]
 
 
 
 
 
 
 
Beginning Balance
 
1,845,032 
 
1,613,912 
1,845,032 
1,613,912 
1,402,306 
Net income
 
 
 
 
593,804 
431,612 
387,026 
Dividends declared, $1.34 in 2012,$1.20 in 2011 and $1.04 in 2010 per share
 
 
 
 
(220,607)
(200,492)
(175,420)
Ending Balance
2,218,229 
 
1,845,032 
 
2,218,229 
1,845,032 
1,613,912 
Accumulated Other Comprehensive Income (Loss)
 
 
 
 
 
 
 
Increase (Decrease) in Stockholders' Equity [Roll Forward]
 
 
 
 
 
 
 
Beginning Balance
 
(9,115)
 
(6,425)
(9,115)
(6,425)
(1,636)
Foreign currency translation adjustment
 
 
 
 
(230)
(2,690)
(4,774)
Unrealized gain on available-for-sale securities
 
 
 
 
 
 
(15)
Ending Balance
(9,345)
 
(9,115)
 
(9,345)
(9,115)
(6,425)
Treasury Stock
 
 
 
 
 
 
 
Increase (Decrease) in Stockholders' Equity [Roll Forward]
 
 
 
 
 
 
 
Beginning Balance
 
(809,581)
 
(598,111)
(809,581)
(598,111)
(502,584)
Stock issued for employee benefit plans
 
 
 
 
40,450 
34,246 
54,308 
Stock-based compensation expense
 
 
 
 
1,647 
865 
971 
Repurchase of common stock
 
 
 
 
(256,640)
(246,581)
(150,806)
Ending Balance
$ (1,024,124)
 
$ (809,581)
 
$ (1,024,124)
$ (809,581)
$ (598,111)
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' INVESTMENT (Parenthetical)
12 Months Ended
Dec. 31, 2012
Dec. 31, 2011
Dec. 31, 2010
Statement of Stockholders' Equity [Abstract]
 
 
 
Dividends declared, per share
$ 1.34 
$ 1.20 
$ 1.04 
CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 31, 2012
Dec. 31, 2011
Dec. 31, 2010
OPERATING ACTIVITIES
 
 
 
Net income
$ 593,804 
$ 431,612 
$ 387,026 
Adjustments to reconcile net income to net cash provided by operating activities:
 
 
 
Depreciation and amortization
38,090 
32,498 
29,369 
Provision for doubtful accounts
10,459 
9,052 
13,922 
Stock-based compensation
59,381 
38,601 
37,047 
Gain on divestiture
(281,551)
0 
0 
Deferred income taxes
(14,442)
5,750 
7,574 
Loss on sale/disposal of assets
3,208 
848 
634 
Other long-term liabilities
513 
765 
2,411 
Changes in operating elements, net of effects of acquisitions:
 
 
 
Receivables
(88,107)
(162,688)
(164,114)
Prepaid expenses and other
5,260 
(11,574)
1,880 
Accounts payable and outstanding checks
61,732 
68,039 
14,684 
Accrued compensation and profit-sharing contribution
(19,064)
20,008 
6,658 
Accrued income taxes
104,542 
(6,688)
2,526 
Other accrued liabilities
(13,483)
3,489 
5,162 
Net cash provided by operating activities
460,342 
429,712 
344,779 
INVESTING ACTIVITIES
 
 
 
Purchases of property and equipment
(36,096)
(35,932)
(17,718)
Purchases and development of software
(14,560)
(16,874)
(10,959)
Cash received for divestiture, net of cash sold
274,802 
0 
0 
Cash paid for acquisitions, net of cash acquired
(583,631)
0 
0 
Purchases of available-for-sale securities
0 
0 
(10,752)
Sales/maturities of available-for-sale securities
0 
9,311 
53,111 
Restricted cash
0 
5,000 
(5,000)
Other
419 
182 
(84)
Net cash (used for) provided by investing activities
(359,066)
(38,313)
8,598 
FINANCING ACTIVITIES
 
 
 
Proceeds from stock issued for employee benefit plans
18,868 
18,936 
24,057 
Stock tendered for payment of withholding taxes
(10,782)
(9,340)
(6,324)
Payment of contingent purchase price
(12,661)
(4,318)
0 
Repurchase of common stock
(245,067)
(240,934)
(151,057)
Cash dividends
(275,353)
(194,697)
(168,902)
Excess tax benefit on stock-based compensation
12,294 
15,255 
13,092 
Proceeds from short-term borrowings
324,051 
0 
0 
Payments on short-term borrowings
(75,688)
0 
0 
Net cash used for financing activities
(264,338)
(415,098)
(289,134)
Effect of exchange rates on cash
(588)
(1,239)
(2,944)
Net (decrease) increase in cash and cash equivalents
(163,650)
(24,938)
61,299 
Cash and cash equivalents, beginning of year
373,669 
398,607 
337,308 
Cash and cash equivalents, end of year
210,019 
373,669 
398,607 
Stock issued for acquisition
60,152 
0 
0 
Cash paid for income taxes
257,580 
256,437 
203,398 
Cash paid for interest
$ 518 
$ 1,274 
$ 21 
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF PRESENTATION. C.H. Robinson Worldwide, Inc. and our subsidiaries (“the company,” “we,” “us,” or “our”) are a global provider of transportation services and logistics solutions through a network of 276 branch offices operating in North America, Europe, Asia, South America, and Australia. The consolidated financial statements include the accounts of C.H. Robinson Worldwide, Inc. and our majority owned and controlled subsidiaries. Our minority interests in subsidiaries are not significant. All intercompany transactions and balances have been eliminated in the consolidated financial statements.
USE OF ESTIMATES. The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities. We are also required to disclose contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Our ultimate results could differ from those estimates.
REVENUE RECOGNITION. Total revenues consist of the total dollar value of goods and services purchased from us by customers. Our net revenues are our total revenues less purchased transportation and related services, including contracted motor carrier, rail, ocean, air, and other costs, and the purchase price and services related to the products we source. We act principally as the service provider for these transactions and recognize revenue as these services are rendered or goods are delivered. At that time, our obligations to the transactions are completed and collection of receivables is reasonably assured. Most transactions in our Transportation and Sourcing businesses are recorded at the gross amount we charge our customers for the service we provide and goods we sell. In these transactions, we are the primary obligor, we have credit risk, we have discretion to select the supplier, and we have latitude in pricing decisions. Additionally, in our Sourcing business, we take loss of inventory risk during shipment and have general inventory risk. Certain transactions in customs brokerage, and transportation management services are recorded at the net amount we charge our customers for the service we provide because many of the factors stated above are not present.
ALLOWANCE FOR DOUBTFUL ACCOUNTS. Accounts receivable are reduced by an allowance for amounts that may become uncollectible in the future. We continuously monitor payments from our customers and maintain a provision for uncollectible accounts based upon our customer aging trends, historical loss experience, and any specific customer collection issues that we have identified.
FOREIGN CURRENCY. Most balance sheet accounts of foreign subsidiaries are translated or remeasured at the current exchange rate as of the end of the year. Statement of operations items are translated at average exchange rates during the year. The resulting translation adjustment is recorded as a separate component of comprehensive income in our statement of operations and comprehensive income.
SEGMENT REPORTING AND GEOGRAPHIC INFORMATION. We operate in the transportation and logistics industry. We provide a wide range of products and services to our customers and contract carriers including transportation services, produce sourcing, freight consolidation, contract warehousing, and information services. Each of these is a significant component to optimizing logistics solutions for our customers.
These services are performed throughout our branch offices, as an integrated offering for which our customers are typically provided a single invoice. Our branches work together to complete transactions and collectively meet the needs of our customers. For large multi-location customers, we often coordinate our efforts in one branch and rely on multiple branch locations to deliver specific geographic or modal needs. As an example, approximately 43 percent of our truckload transactions are shared transactions between branches. In addition, our methodology of providing services is very similar across all branches. The majority of our global network operates on a common technology platform that is used to match customer needs with supplier capabilities, to collaborate with other branch locations, and to utilize centralized support resources to complete all facets of the transaction. Accordingly, our chief operating decision maker analyzes our business as a single segment, relying on net revenues and operating income across our network of branch offices as the primary performance measures.
The following table presents our total revenues (based on location of the customer) and long-lived assets (including intangible and other assets) by geographic regions (in thousands):
 
 
For the year ended December 31,
 
2012
 
2011
 
2010
Total revenues
 
 
 
 
 
United States
$
10,183,596

 
$
9,488,165

 
$
8,298,324

Other locations
1,175,517

 
848,181

 
975,981

Total revenues
$
11,359,113

 
$
10,336,346

 
$
9,274,305

 
 
December 31,
 
2012
 
2011
 
2010
Long-lived assets
 
 
 
 
 
United States
$
281,729

 
$
156,471

 
$
135,312

Other locations
27,991

 
10,337

 
11,667

Total long-lived assets
$
309,720

 
$
166,808

 
$
146,979


CASH AND CASH EQUIVALENTS. Cash and cash equivalents consist primarily of tax exempt and treasury money market funds with original maturities of less than 90 days. The carrying amount approximates fair value due to the short maturity of the instruments.
PREPAID EXPENSES AND OTHER. Prepaid expenses and other include such items as prepaid rent, software maintenance contracts, insurance premiums, other prepaid operating expenses, and inventories, consisting primarily of produce and related products held for resale.
PROPERTY AND EQUIPMENT. Property and equipment are recorded at cost. Maintenance and repair expenditures are charged to expense as incurred. Depreciation is computed using the straight-line method over the estimated lives of the assets of 3 to 30 years. Amortization of leasehold improvements is computed over the shorter of the lease term or the estimated useful lives of the improvements.
We recognized the following depreciation expense (in thousands): 
2012
$
24,254

2011
23,410

2010
20,393


A summary of our property and equipment as of December 31 is as follows (in thousands):
 
 
2012
 
2011
Furniture, fixtures, and equipment
$
145,746

 
$
115,751

Buildings
64,452

 
55,682

Corporate aircraft
11,334

 
11,334

Leasehold improvements
22,663

 
17,781

Land
15,004

 
14,841

Construction in progress
5,808

 
4,684

Less accumulated depreciation
(115,156
)
 
(93,243
)
Net property and equipment
$
149,851

 
$
126,830



GOODWILL AND OTHER INTANGIBLE ASSETS. Goodwill is the difference between the purchase price of a company and the fair market value of the acquired company’s net identifiable assets. Other intangible assets include customer lists, contract carrier lists, and non-competition agreements. These intangible assets are being amortized using the straight-line method over their estimated lives, ranging from 3 to 8 years. Goodwill is not amortized, but is tested for impairment using a fair value approach. Goodwill is tested for impairment annually or more frequently if events warrant. Intangible assets are evaluated for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. See Note 2.
OTHER ASSETS. Other assets include such items as purchased and internally developed software, and the investments related to our nonqualified deferred compensation plan. We amortize software using the straight-line method over 3 years. We recognized the following amortization expense of purchased and internally developed software (in thousands):
 
2012
 
$
7,528

2011
 
5,180

2010
 
4,047


A summary of our purchased and internally developed software as of December 31 is as follows (in thousands):
 
 
2012
 
2011
Purchased software
$
15,524

 
$
14,111

Internally developed software
20,029

 
28,140

Less accumulated amortization
(20,744
)
 
(17,392
)
Net software
$
14,809

 
$
24,859


INCOME TAXES. Income taxes are accounted for using the asset and liability method. Under this method, deferred tax assets and liabilities are recognized for the future tax consequences of temporary differences between the carrying amounts and tax bases of assets and liabilities using enacted rates.
Annual tax provisions include amounts considered sufficient to pay assessments that may result from examination of prior year tax returns; however, the amount ultimately paid upon resolution of issues raised may differ from the amounts accrued.
The financial statement effects of an uncertain income tax position are recognized when it is more likely than not, based on the technical merits, that the position will be sustained upon examination. Unrecognized tax benefits are more likely than not owed to a taxing authority and the amount of the contingency can be reasonably estimated. Uncertain income tax positions are included in “Noncurrent income taxes payable” in the consolidated balance sheets.
Provisions are made for U.S. taxes on undistributed earnings of foreign subsidiaries and related companies.
COMPREHENSIVE INCOME. Comprehensive income includes any changes in the equity of an enterprise from transactions and other events and circumstances from non-owner sources. Our two components of other comprehensive income are foreign currency translation adjustment and unrealized gains and losses from investments. They are presented on our consolidated statements of operations and comprehensive income.
STOCK-BASED COMPENSATION. The fair value of each share-based payment award is established on the date of grant. For grants of restricted shares and restricted units, the fair value is established based on the market price on the date of the grant, discounted for post-vesting holding restrictions. The discounts have varied from 12 percent to 22 percent and are calculated using the Black-Scholes option pricing model. Changes in measured stock volatility and interest rates are the primary reason for changes in the discount.
For grants of options, we use the Black-Scholes option pricing model to estimate the fair value of share-based payment awards. The determination of the fair value of share-based awards is affected by our stock price and a number of assumptions, including expected volatility, expected life, risk-free interest rate, and expected dividends.
GOODWILL AND OTHER INTANGIBLE ASSETS
GOODWILL AND OTHER INTANGIBLE ASSETS
NOTE 2: GOODWILL AND OTHER INTANGIBLE ASSETS
The change in the carrying amount of goodwill is as follows (in thousands):
 
 
2012
 
2011
Balance, beginning of year
$
359,688

 
$
359,116

Acquisitions
462,232

 
2,009

Translation
295

 
(1,437
)
Balance, end of year
$
822,215

 
$
359,688


The additions to goodwill are related to our acquisitions discussed in more detail in Note 8. We complete an impairment test on goodwill annually. This impairment test did not result in any impairment losses. There is no aggregate goodwill impairment for any of periods.
A summary of our other intangible assets, with finite lives, which include primarily customer relationships and non-competition agreements, as of December 31 is as follows (in thousands):
 
 
2012
 
2011
Gross
$
149,644

 
$
17,862

Accumulated amortization
(14,108
)
 
(9,708
)
Net
$
135,536

 
$
8,154


Other intangible assets, with indefinite lives, are as follows (in thousands):
 
 
2012
 
2011
Trademarks
$
1,875

 
$
1,875



Amortization expense for other intangible assets was (in thousands):
 
2012
$
6,308

2011
3,908

2010
4,929


Intangible assets at December 31, 2012 will be amortized over the next eight years, and that expense is as follows (in thousands):
 
 
2013
$
20,158

2014
18,719

2015
16,939

2016
16,922

2017
16,827

Thereafter
45,971

Total
$
135,536

FAIR VALUE MEASUREMENT
FAIR VALUE MEASUREMENT
NOTE 3: FAIR VALUE MEASUREMENT
Accounting guidance on fair value measurements for certain financial assets and liabilities requires that assets and liabilities carried at fair value be classified and disclosed in one of the following three categories:
•
Level 1 — Quoted market prices in active markets for identical assets or liabilities.
•
Level 2 — Observable market-based inputs or unobservable inputs that are corroborated by market data.
•
Level 3 — Unobservable inputs reflecting the reporting entity’s own assumptions or external inputs from inactive markets.
A financial asset or liability’s classification within the hierarchy is determined based on the lowest level of input that is significant to the fair value measurement.
The following table presents information as of December 31, 2012, about our financial assets and liabilities that are measured at fair value on a recurring basis, according to the valuation techniques we used to determine their fair values (in thousands).
 
 
Level 1
 
Level 2
 
Level 3
 
Total Fair
Value
December 31, 2012
 
 
 
 
 
 
 
Contingent purchase price related to acquisitions
—

 
—

 
922

 
922

Total liabilities at fair value
$
—

 
$
—

 
$
922

 
$
922

 
 
Level 1
 
Level 2
 
Level 3
 
Total Fair
Value
December 31, 2011
 
 
 
 
 
 
 
Contingent purchase price related to acquisitions
—

 
—

 
13,070

 
13,070

Total liabilities at fair value
$
—

 
$
—

 
$
13,070

 
$
13,070



In measuring the fair value of the contingent payment liability, we used an income approach that considers the expected future earnings of the acquired businesses and the resulting contingent payments, discounted at a risk-adjusted rate.
The table below sets forth a reconciliation of our beginning and ending Level 3 financial liability balance (in thousands).
 
 
2012
 
2011
 
2010
Balance, beginning of period
$
13,070

 
$
16,623

 
$
14,658

Payments of contingent purchase price
(12,661
)
 
(4,318
)
 
(445
)
Total unrealized losses included in earnings
513

 
765

 
2,410

Balance, end of period
$
922

 
$
13,070

 
$
16,623

FINANCING ARRANGEMENTS
FINANCING ARRANGEMENTS
NOTE 4. FINANCING ARRANGEMENTS

On October 29, 2012, we entered into a senior unsecured revolving credit facility for up to $500 million with a $500 million accordion feature (the "Credit Agreement"), with a syndicate of financial institutions led by U. S. Bank. The purpose of this facility was to partially fund the acquisition of Phoenix and will allow us to continue to fund working capital, capital expenditures, dividends, and share repurchases. The Credit Agreement expires on October 29, 2017.
As of December 31, 2012, we had $253.0 million in borrowings outstanding under the Credit Agreement which is classified as a current liability on the consolidated balance sheet. We consider these borrowings to be a Level 2 financial liability and therefore, the recorded amount of borrowings outstanding approximates fair value because of the short maturity period of the debt.
Borrowings under the Credit Agreement generally bear interest at a variable rate equal to (i) LIBOR plus 1.00%, or (ii) the base rate (which is the highest of (a) the administrative agent's prime rate, (b) the federal funds rate plus 0.50%, or (c) the sum of 1.00% plus one-month LIBOR plus a specified margin). In addition, there is a commitment fee on the average daily undrawn sated amount under each letter of credit issued under the facility. The weighted average interest rate incurred on borrowings during 2012 and at December 31, 2012 was approximately 1.2%.
The Credit Agreement contains various restrictions and covenants. Among other requirements, we may not permit our leverage ratio, as of the end of each of our fiscal quarters, of (i) Consolidated Funded Indebtedness to (ii) Consolidated Total Capitalization, to be greater than 0.65 to 1.00. We were in compliance with the debt covenants as of December 31, 2012.
The Credit Agreement also contains customary events of default. If an event of default under the Credit Agreement occurs and is continuing, then the administrative agent may declare any outstanding obligations under the Credit Agreement to be immediately due and payable. In addition, if we become the subject of voluntary or involuntary proceedings under any bankruptcy, insolvency or similar law, then any outstanding obligations under the Credit Agreement will automatically become immediately due and payable.
INCOME TAXES
INCOME TAXES
NOTE 5: INCOME TAXES
C.H. Robinson Worldwide, Inc. and its 80 percent (or more) owned U.S. subsidiaries file a consolidated federal income tax return. We file unitary or separate state returns based on state filing requirements. With few exceptions, we are no longer subject to audits of U.S. federal, state and local, or non-U.S. income tax returns before 2006.
A reconciliation of the beginning and ending amount of unrecognized tax benefits, excluding interest and penalties, is as follows (in thousands): 
 
2012
 
2011
 
2010
Unrecognized tax benefits, beginning of period
$
7,668

 
$
7,595

 
$
7,776

Additions based on tax positions related to the current year
4,172

 
1,476

 
1,891

Additions for tax positions of prior years
6,911

 
290

 
1,565

Reductions for tax positions of prior years
(1,061
)
 
(1,005
)
 
(1,544
)
Lapse in statute of limitations
(286
)
 
(688
)
 
(2,093
)
Settlements
(616
)
 
—

 
—

Unrecognized tax benefits, end of the period
$
16,788

 
$
7,668

 
$
7,595


As of December 31, 2012, we had $20.6 million of unrecognized tax benefits and related interest and penalties, all of which would affect our effective tax rate if recognized. We are not aware of any tax positions for which it is reasonably possible that the total amount of unrecognized tax benefit will significantly increase or decrease in the next twelve months.
Income tax expense considers amounts which may be needed to cover exposures for open tax years. We do not expect any material impact related to open tax years; however, actual settlements may differ from amounts accrued.
We recognize interest and penalties related to uncertain tax positions in the provision for income taxes. During the years ended December 31, 2012, 2011, and 2010, we recognized approximately $0.8 million, and $0.8 million, and $1.5 million in interest and penalties. We had approximately $3.8 million and $2.8 million for the payment of interest and penalties accrued within noncurrent taxes payable as of December 31, 2012 and 2011. These amounts are not included in the reconciliation above.

The components of the provision for income taxes consist of the following for the years ended December 31 (in thousands):
 
 
2012
 
2011
 
2010
Tax provision:
 
 
 
 
 
Federal
$
326,708

 
$
219,124

 
$
195,843

State
38,931

 
28,260

 
25,492

Foreign
13,461

 
9,958

 
8,167

 
379,100

 
257,342

 
229,502

Deferred provision (benefit):
 
 
 
 
 
Federal
(11,674
)
 
4,781

 
4,397

State
(1,334
)
 
546

 
503

Foreign
(1,434
)
 
423

 
2,674


(14,442
)
 
5,750

 
7,574

Total provision
$
364,658

 
$
263,092

 
$
237,076


A reconciliation of the provision for income taxes using the statutory federal income tax rate to our effective income tax rate for the years ended December 31 is as follows: 
 
2012
 
2011
 
2010
Federal statutory rate
35.0
%
 
35.0
%
 
35.0
%
State income taxes, net of federal benefit
2.7

 
2.7

 
2.7

Other
0.3

 
0.2

 
0.3

 
38.0
%
 
37.9
%
 
38.0
%

Deferred tax assets (liabilities) are comprised of the following at December 31 (in thousands): 
 
2012
 
2011
Deferred tax assets:
 
 
 
Compensation
$
96,660

 
$
80,577

Receivables
11,836

 
10,375

Other
9,443

 
7,992

Deferred tax liabilities:
 
 
 
Intangible assets
(109,334
)
 
(59,122
)
Prepaid assets
(7,825
)
 
(8,476
)
Long-lived assets
(21,171
)
 
(18,463
)
Undistributed earnings of foreign subsidiaries
(12,857
)
 
(5,324
)
Other
(85
)
 
(7
)
Net deferred tax (liabilities) assets
$
(33,333
)
 
$
7,552


We have foreign net operating loss carryforwards with a tax effect of $5.1 million. A full valuation allowance has been established for these net operating loss carryforwards due to the uncertainty of the use of the tax benefit in future periods.
CAPITAL STOCK AND STOCK AWARD PLANS
CAPITAL STOCK AND STOCK AWARD PLANS
NOTE 6: CAPITAL STOCK AND STOCK AWARD PLANS
PREFERRED STOCK. Our Certificate of Incorporation authorizes the issuance of 20,000,000 shares of Preferred Stock, par value $0.10 per share. There are no shares of Preferred Stock outstanding. The Preferred Stock may be issued by resolution of our Board of Directors at any time without any action of the stockholders. The Board of Directors may issue the Preferred Stock in one or more series and fix the designation and relative powers. These include voting powers, preferences, rights, qualifications, limitations, and restrictions of each series. The issuance of any such series may have an adverse effect on the rights of holders of Common Stock and may impede the completion of a merger, tender offer, or other takeover attempt.

COMMON STOCK. Our Certificate of Incorporation authorizes 480,000,000 shares of Common Stock, par value $.10 per share. Subject to the rights of Preferred Stock which may from time to time be outstanding, holders of Common Stock are entitled to receive dividends out of funds legally available, when and if declared by the Board of Directors, and to receive their share of the net assets of the company legally available for distribution upon liquidation or dissolution.
For each share of Common Stock held, stockholders are entitled to one vote on each matter to be voted on by the stockholders, including the election of directors. Holders of Common Stock are not entitled to cumulative voting; the holders of more than 50 percent of the outstanding Common Stock can elect all of any class of directors if they choose to do so. The stockholders do not have preemptive rights. All outstanding shares of Common Stock are fully paid and nonassessable.
STOCK AWARD PLANS. Stock-based compensation cost is measured at the grant date based on the value of the award and is recognized as expense as it vests. A summary of our total compensation expense recognized in our consolidated statements of operations and comprehensive income for stock-based compensation is as follows (in thousands):

 
2012
 
2011
 
2010
Stock options
 
$
3,585

 
$
61

 
$
1,539

Stock awards
 
53,481

 
36,390

 
33,519

Company expense on ESPP discount
 
2,315

 
2,150

 
1,989

Total stock based compensation expense
 
$
59,381

 
$
38,601

 
$
37,047


Our 1997 Omnibus Stock Plan allows us to grant certain stock awards, including stock options at fair market value and restricted shares and units, to our key employees and outside directors. A maximum of 28,000,000 shares can be granted under this plan; approximately 3,642,000 shares were available for stock awards as of December 31, 2012. Awards that expire or are canceled without delivery of shares generally become available for issuance under the plans. We plan to submit a new equity incentive plan for shareholder approval at our Annual Meeting of Stockholders on May 9, 2013.
We have awarded performance-based stock options to certain key employees. These options are subject to certain vesting requirements over a five-year period, based on the company’s earnings growth. Any options remaining unvested at the end of the five year vesting period are forfeited to the company. Although participants can exercise options via a stock swap exercise, we do not issue reloads (restoration options) on the grants from 2011 and 2012.
The fair value of these options is established based on the market price on the date of grant, discounted for post-vesting holding restrictions, calculated using the Black-Scholes option pricing model. Changes in measured stock price volatility and interest rates are the primary reasons for changes in the discount. These grants are being expensed based on the terms of the awards. As of December 31, 2012, unrecognized compensation expense related to stock options was $26.0 million. The amount of future expense to be recognized will be based on the company’s earnings growth and certain other conditions.
The following schedule summarizes stock option activity in the plan. All outstanding unvested options as of December 31, 2012, relate to the performance-based grants from 2011 and 2012.
 
 
Shares
 
Weighted
Average
Exercise
Price
 
Aggregate
Intrinsic
Value
(in thousands)
 
Average
Remaining
Life
(years)
December 31, 2011
1,522,624

 
$
51.81

 
 
 
 
Grants
1,184,487

 
62.02

 
 
 
 
Exercised
(362,699
)
 
21.01

 
 
 
 
Terminated
(49,315
)
 
62.27

 
 
 
 
Outstanding at December 31, 2012
2,295,097

 
$
61.72

 
$
3,439

 
8.57
Vested at December 31, 2012
445,778

 
$
50.21

 
$
5,800

 
4.44
Exercisable at December 31, 2012
445,778

 
$
50.21

 
$
5,800

 
4.44


Information on the intrinsic value of options exercised is as follows (in thousands):
 
2012
$
15,516

2011
20,097

2010
43,485


Determining Fair Value
We estimated the fair value of stock options granted using the Black-Scholes option pricing model. We estimate the fair value of restricted shares and units using the Black-Scholes option pricing model - protective put method. A description of significant assumptions used to estimate the expected volatility, risk-free interest rate and expected terms is as follows:
Expected Volatility - Expected volatility was determined based on implied volatility of our traded options and historical volatility of our stock price.
Risk-Free Interest Rate - The risk-free interest rate was based on the implied yield available on U.S. Treasury zero-coupon issues at the date of grant with a term equal to the expected term.
Expected Term - Expected term represents the period that our stock-based awards are expected to be outstanding and was determined based on historical experience and anticipated future exercise patterns, giving consideration to the contractual terms of unexercised stock-based awards.
The fair value per option was estimated using the Black-Scholes option pricing model with the following assumptions:
 
 
2012 Grants
 
2011 Grants
 
2010 Grants
Risk-free interest rate
.18-.89%

 
.12-1.22%

 
.47-1.07%

Dividend per share (quarterly amounts)
$.33-.35

 
$.29-.33

 
$.25-.29

Expected volatility factor
26.0-27.5%

 
27.5-29.93%

 
30.2-31.2%

Expected option term
.01-6 years

 
.01-6 years

 
.01-3 years

Weighted average fair value per option
$
13.61

 
$
15.58

 
$
9.43


RESTRICTED STOCK GRANTS. We have awarded performance-based restricted shares and restricted units to certain key employees and non-employee directors. These restricted shares and restricted units are subject to certain vesting requirements over a five-year period, based on the company’s earnings growth. The awards also contain restrictions on the awardees’ ability to sell or transfer vested shares or units for a specified period of time. The fair value of these shares is established based on the market price on the date of grant, discounted for post-vesting holding restrictions. The discounts have varied from 12 percent to 22 percent and are calculated using the Black-Scholes option pricing model - protective put method. Changes in measured stock price volatility and interest rates are the primary reasons for changes in the discount. These grants are being expensed based on the terms of the awards.
The following table summarizes our nonvested performance-based restricted stock grants as of December 31, 2012: 
 
Number of Restricted
Shares and Units
 
Weighted Average
Grant Date Fair Value
Nonvested at December 31, 2011
3,445,251

 
$
47.56

Granted
339,453

 
48.66

Vested
(1,095,134
)
 
46.35

Forfeitures
(120,982
)
 
46.55

Nonvested at December 31, 2012
2,568,588

 
$
48.26


The following table summarizes performance-based shares and units by year of grant:
 
Year of grant
 
First vesting date
 
Last vesting date
 
Shares and units
granted, net of
forfeitures
 
Weighted
average grant
date fair value (1)
 
Shares and units
non-vested
2008
 
December 31, 2009
 
December 31, 2013
 
2,269,011

 
$
39.66

 
884,914

2009
 
December 31, 2010
 
December 31, 2014
 
904,167

 
44.06

 
415,917

2010
 
December 31, 2011
 
December 31, 2015
 
737,937

 
63.28

 
435,383

2011
 
December 31, 2012
 
December 31, 2016
 
650,058

 
53.73

 
494,044

2012
 
December 31, 2013
 
December 31, 2017
 
338,330

 
48.65

 
338,330

 
 
 
 
 
 
4,899,503

 
$
46.51

 
2,568,588

________________________ 
(1) Amount shown is the weighted average grant date fair value of shares and units granted, net of forfeitures.

We have also awarded restricted shares and units to certain key employees that vest primarily based on their continued employment. The value of these awards is established by the market price on the date of the grant and is being expensed over the vesting period of the award. The following table summarizes these nonvested restricted stock grants as of December 31, 2012: 
 
Number of Restricted
Shares and Units
 
Weighted Average
Grant Date Fair Value
Nonvested at December 31, 2011
99,462

 
$
18.07

Granted
456,930

 
48.60

Vested
(26,944
)
 
19.99

Forfeitures
(1,509
)
 
66.27

Nonvested at December 31, 2012
527,939

 
$
44.26


We have also issued to certain key employees and non-employee directors restricted units which are fully vested upon issuance. These shares and units contain restrictions on the awardees’ ability to sell or transfer vested shares or units for a specified period of time. The fair value of these shares is established using the same method discussed above. These grants have been expensed during the year they were earned.
A summary of the fair value of restricted stock vested (in thousands):
 
2012
$
53,562

2011
35,663

2010
34,056


As of December 31, 2012, there is unrecognized compensation expense of $147.3 million related to previously granted restricted shares and units. The amount of future expense to be recognized will be based on the company’s earnings growth and certain other conditions.
EMPLOYEE STOCK PURCHASE PLAN. Our 1997 Employee Stock Purchase Plan allows our employees to contribute up to $10,000 of their annual cash compensation to purchase company stock. Purchase price is determined using the closing price on the last day of the quarter discounted by 15 percent. Shares are vested immediately. The following is a summary of the employee stock purchase plan activity (dollar amounts in thousands):
 
 
 
Shares purchased
by employees
 
Aggregate cost
to employees
 
Expense recognized
by the company
2012
 
248,405

 
$
13,116

 
$
2,315

2011
 
196,332

 
12,183

 
2,150

2010
 
215,054

 
11,273

 
1,989


SHARE REPURCHASE PROGRAMS. During 2007, 2009, and 2012, our Board of Directors authorized stock repurchase programs that allow management to repurchase 10,000,000 shares under each authorization for reissuance upon the exercise of employee stock options and other stock plans. There are no shares remaining to repurchase under the 2007 authorization. The activity under those programs for each of the periods reported is as follows (dollar amounts in thousands):
 
 
 
Shares repurchased
 
Total value of shares
repurchased
2007 Program
 
 
 
 
2008 Purchases
 
3,720,704

 
$
200,800

2009 Purchases
 
5,101,747

 
266,900

2010 Purchases
 
1,114,849

 
60,600


 
 
Shares repurchased
 
Total value of shares
repurchased
2009 Program
 
 
 
 
2010 Purchases

1,394,831


$
90,500

2011 Purchases
 
3,540,171

 
246,935

2012 Purchases
 
4,237,555

 
257,064


As of December 31, 2012, there were 827,443 shares remaining for repurchase under the 2009 authorization and 10,000,000 shares remaining for repurchase under the 2012 authorization. We are currently purchasing shares under the 2009 authorization.
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES
NOTE 7: COMMITMENTS AND CONTINGENCIES
EMPLOYEE BENEFIT PLANS. We offer a defined contribution which qualifies under section 401(k) of the Internal Revenue Code and covers all eligible U.S. employees. Annual profit-sharing contributions are determined by us, in accordance with the provisions of the plan. We can also elect to make matching contributions to the plan. Defined contribution plan expense, including matching contributions, was approximately (in thousands):
 
2012
$
24,769

2011
30,550

2010
28,293


We have committed to a defined contribution match of four percent of eligible compensation in 2013.
NONQUALIFIED DEFERRED COMPENSATION PLAN. The Robinson Companies Nonqualified Deferred Compensation Plan provided certain employees the opportunity to defer a specified percentage or dollar amount of their cash and stock compensation. Participants could elect to defer up to 100 percent of their cash compensation. The accumulated benefit obligation was $0.9 million and $1.0 million as of December 31, 2012 and 2011. We have purchased investments to fund the future liability. The investments had an aggregate market value of $0.9 million and $1.0 million as of December 31, 2012 and 2011 and are included in other assets in the consolidated balance sheets. In addition, all restricted shares granted but not yet delivered or not yet forfeited are also held within this plan.
LEASE COMMITMENTS. We lease certain facilities and equipment under operating leases. Information regarding our lease expense is as follows (in thousands):
 
2012
$
41,689

2011
40,375

2010
36,945


Minimum future lease commitments under noncancelable lease agreements in excess of one year as of December 31, 2012, are as follows (in thousands):
 
2013
$
45,592

2014
38,301

2015
30,576

2016
22,523

2017
15,366

Thereafter
22,702

Total
$
175,060


In addition to minimum lease payments, we are typically responsible under our lease agreements to pay our pro rata share of maintenance expenses, common charges, and real estate taxes of the buildings we lease space in.

LITIGATION. We are not subject to any pending or threatened litigation other than routine litigation arising in the ordinary course of our business operations, including eight contingent auto liability cases. For such legal proceedings, we have accrued an amount that reflects the aggregate liability deemed probable and estimable, but this amount is not material to our consolidated financial position, results of operations, or cash flows. Because of the preliminary nature of many of these proceedings, the difficulty in ascertaining the applicable facts relating to many of these proceedings, the inconsistent treatment of claims made in many of these proceedings, and the difficulty of predicting the settlement value of many of these proceedings, we are not able to estimate an amount or range of any reasonably possible additional losses. However, based upon our historical experience, the resolution of these proceedings is not expected to have a material effect on our consolidated financial position, results of operations, or cash flows.
ACQUISITIONS
ACQUISITIONS AND DIVESTITURES
NOTE 8: ACQUISITIONS AND DIVESTITURES
On November 1, 2012, we acquired all of the outstanding stock of Phoenix International Freight Services, Ltd. (“Phoenix”) for the purpose of expanding our current market presence and service offerings in international freight forwarding. Total purchase consideration was $660.6 million, net of estimated post-closing cash and working capital adjustments, in accordance with the purchase agreement. The acquisition price was financed with $60.2 million in newly-issued common stock (representing 1.1 million shares), borrowings under the revolving credit facility of approximately $173.0 million discussed in Note 4, and the remainder with cash on-hand. We incurred $9.9 million of transaction expenses that are included in other selling, general, and administrative expenses in our consolidated statements of operations and comprehensive income related to this acquisition during 2012.
The following is a preliminary summary of the allocation of purchase consideration to the estimated fair value of net assets for the acquisition of Phoenix (in thousands):
Cash and cash equivalents
$
75,372

Receivables
124,056

Other current assets
8,929

Property and equipment
12,160

Identifiable intangible assets
130,000

Goodwill
447,877

Other noncurrent assets
5,044

Total assets
$
803,438

 

Accounts payable
$
(45,367
)
Accrued expenses
(14,340
)
Other liabilities
(83,155
)
Estimated net assets acquired
$
660,576


Identifiable intangible assets and estimated useful lives are as follows (dollars in thousands):
 
Estimated Life (years)
 
 
Customer relationships
8
 
$
129,800

Noncompete agreements
5
 
200

Total identifiable intangible assets
 
 
$
130,000



The Phoenix goodwill is a result of acquiring and retaining the Phoenix existing workforce and expected synergies from integrating their business into C.H. Robinson. The goodwill will not be deductible for tax purposes. Purchase accounting is considered preliminary, subject to revision, mainly with respect to certain working capital accounts, taxes, and goodwill, as final information was not available as of December 31, 2012.
On an unaudited pro forma basis, assuming the Phoenix acquisition had closed January 1, 2011, the combined results of C.H. Robinson and Phoenix would have resulted in revenues of $11.2 billion for the year ended December 31, 2011, and $12.1 billion for the year ended December 31, 2012, operating income of $729.6 million and $707.4 million, and net income of $445.8 million and $610.7 million during those same periods, respectively.
The 2012 pro forma financial information includes adjustments for additional amortization expense on identifiable intangible assets of $13.6 million and incremental interest expense of $2.2 million, eliminating non-recurring transactional professional fees of $18.5 million and contractual changes in compensation of $6.5 million, and tax effect impact of $6.9 million based on our consolidated effective tax rate.
The 2011 pro forma financial information includes adjustments for additional amortization expense on identifiable intangible assets of $16.3 million and incremental interest expense of $2.6 million, eliminating non-recurring contractual changes in compensation related expenses of $4.1 million, and tax effect impact of $1.8 million based on our consolidated effective tax rate.
The pro forma consolidated financial information was prepared for comparative purposes only and includes certain adjustments, as noted above. The adjustments are estimates based on currently available information and actual amounts may have differed materially from these estimates. They do not reflect the effect of costs or synergies that would have been expected to result from the integration of the acquisition. The pro forma information does not purport to be indicative of the results of operations that actually would have resulted had the acquisition occurred at the beginning of each period presented or of future results of the consolidated entity. The results of operations and financial condition of Phoenix has been included in our consolidated financial statements since their acquisition date of November 1, 2012.
On October 16, 2012, we sold substantially all of the operations of our subsidiary, T-Chek Systems, Inc. ("T-Chek"), which represented a majority of our Payment Services business, to Electronic Funds Source, LLC ("EFS") for $302.5 million in cash, subject to post-closing adjustments. EFS acquired the assets and assumed certain liabilities of T-Chek. We recorded a gain on the sale of the assets and liabilities of approximately $281.6 million during the fourth quarter of 2012.
On October 1, 2012, we acquired all of the outstanding stock of the operating subsidiaries of Apreo Logistics S.A. ("Apreo"), a leading freight forwarder based in Warsaw, Poland, for the purpose of expanding our current market presence and service offerings in Europe. The total purchase price of Apreo was approximately$26.5 million, which was paid in cash and is subject to post-closing adjustments. We recorded $17.4 million of goodwill and other intangible assets related to this acquisition. The goodwill will not be deductible for tax purposes. The results of our operations for 2012 were not materially impacted by this acquisition.
In September 2011, we acquired substantially all of the assets of Timco Worldwide in exchange for the assumption of approximately $3.8 million of liabilities. Timco Worldwide was a melon category provider in Davis, California. We recorded $2.4 million of goodwill and other intangible assets related to this acquisition. All goodwill and other intangible assets related to this acquisition are tax deductible over 15 years. The results of our operations for 2011 were not materially impacted by this acquisition.
The results of operations and financial condition of these acquisitions have been included in our consolidated financial statements since their acquisition dates.
SUPPLEMENTARY DATA
SUPPLEMENTARY DATA
NOTE 9: SUPPLEMENTARY DATA
Our unaudited results of operations for each of the quarters in the years ended December 31, 2012 and 2011 are summarized below (in thousands, except per share data).
 
2012
 
March 31
 
June 30
 
September 30
 
December 31 (1)
Total revenues:
 
 
 
 
 
 
 
 
Transportation
 
$
2,176,797

 
$
2,476,805

 
$
2,445,883

 
$
2,585,930

Sourcing
 
359,730

 
462,597

 
418,377

 
379,479

Payment Services
 
15,587

 
16,312

 
16,149

 
5,467

Total revenues
 
2,552,114

 
2,955,714

 
2,880,409

 
2,970,876

Costs and expenses:
 
 
 
 
 
 
 
 
Purchased transportation and related services
 
1,809,581

 
2,107,799

 
2,063,109

 
2,176,789

Purchased products sourced for resale
 
327,787

 
422,392

 
384,630

 
348,936

Purchased payment services
 
—

 
—

 
—

 
519

Personnel expenses
 
183,438

 
177,184

 
179,342

 
226,042

Other selling, general, and administrative expenses
 
61,763

 
63,425

 
66,071

 
84,986

Total costs and expenses
 
2,382,569

 
2,770,800

 
2,693,152

 
2,837,272

Income from operations
 
169,545

 
184,914

 
187,257

 
133,604

Net income
 
$
106,500

 
$
114,582

 
$
116,330

 
$
256,392

Basic net income per share
 
$
0.65

 
$
0.71

 
$
0.72

 
$
1.59

Diluted net income per share
 
$
0.65

 
$
0.71

 
$
0.72

 
$
1.58

Basic weighted average shares outstanding
 
162,693

 
161,887

 
160,782

 
160,880

Dilutive effect of outstanding stock awards
 
330

 
313

 
221

 
919

Diluted weighted average shares outstanding
 
163,023

 
162,200

 
161,003

 
161,799

Market price range of common stock:
 
 
 
 
 
 
 
 
High
 
$
71.76

 
$
67.31

 
$
61.97

 
$
64.14

Low
 
$
62.84

 
$
55.35

 
$
50.81

 
$
57.16

_________________________ 
(1)
The quarter ended December 31, 2012 is not comparable to the previous periods shown in this footnote due to certain significant charges or credits related to our recent acquisitions and divestitures.

2011
 
March 31
 
June 30
 
September 30
 
December 31
Total revenues:
 
 
 
 
 
 
 
 
Transportation
 
$
1,991,022

 
$
2,269,036

 
$
2,280,208

 
$
2,200,258

Sourcing
 
360,028

 
423,536

 
399,220

 
352,744

Payment Services
 
14,422

 
15,090

 
15,500

 
15,282

Total revenues
 
2,365,472

 
2,707,662

 
2,694,928

 
2,568,284

Costs and expenses:
 
 
 
 
 
 
 
 
Purchased transportation and related services
 
1,648,102

 
1,901,189

 
1,905,731

 
1,841,586

Purchased products sourced for resale
 
327,029

 
388,607

 
366,131

 
325,313

Personnel expenses
 
175,109

 
178,945

 
178,117

 
164,062

Other selling, general, and administrative expenses
 
58,517

 
58,826

 
60,984

 
65,368

Total costs and expenses
 
2,208,757

 
2,527,567

 
2,510,963

 
2,396,329

Income from operations
 
156,715

 
180,095

 
183,965

 
171,955

Net income
 
$
97,028

 
$
111,023

 
$
114,347

 
$
109,214

Basic net income per share
 
$
0.59

 
$
0.67

 
$
0.70

 
$
0.67

Diluted net income per share
 
$
0.59

 
$
0.67

 
$
0.70

 
$
0.67

Basic weighted average shares outstanding
 
165,124

 
164,607

 
163,948

 
162,919

Dilutive effect of outstanding stock awards
 
640

 
587

 
523

 
906

Diluted weighted average shares outstanding
 
165,764

 
165,194

 
164,471

 
163,825

Market price range of common stock:
 
 
 
 
 
 
 
 
High
 
$
82.05

 
$
81.53

 
$
82.61

 
$
76.76

Low
 
$
70.32

 
$
73.30

 
$
62.30

 
$
63.21

SCHEDULE II. VALUATION AND QUALIFYING ACCOUNTS
SCHEDULE II. VALUATION AND QUALIFYING ACCOUNTS
SCHEDULE II. VALUATION AND QUALIFYING ACCOUNTS
Allowance for Doubtful Accounts
The transactions in the allowance for doubtful accounts for the years ended December 31 were as follows (in thousands): 
 
2012
 
2011
 
2010
Balance, beginning of year
$
31,328

 
$
30,945

 
$
30,651

Provision
10,459

 
9,052

 
13,922

Write-offs
(7,227
)
 
(8,669
)
 
(13,628
)
Balance, end of year
$
34,560

 
$
31,328

 
$
30,945

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)
BASIS OF PRESENTATION 
BASIS OF PRESENTATION. C.H. Robinson Worldwide, Inc. and our subsidiaries (“the company,” “we,” “us,” or “our”) are a global provider of transportation services and logistics solutions through a network of 276 branch offices operating in North America, Europe, Asia, South America, and Australia. The consolidated financial statements include the accounts of C.H. Robinson Worldwide, Inc. and our majority owned and controlled subsidiaries. Our minority interests in subsidiaries are not significant. All intercompany transactions and balances have been eliminated in the consolidated financial statements.
USE OF ESTIMATES 
USE OF ESTIMATES. The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities. We are also required to disclose contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Our ultimate results could differ from those estimates.
REVENUE RECOGNITION 
REVENUE RECOGNITION. Total revenues consist of the total dollar value of goods and services purchased from us by customers. Our net revenues are our total revenues less purchased transportation and related services, including contracted motor carrier, rail, ocean, air, and other costs, and the purchase price and services related to the products we source. We act principally as the service provider for these transactions and recognize revenue as these services are rendered or goods are delivered. At that time, our obligations to the transactions are completed and collection of receivables is reasonably assured. Most transactions in our Transportation and Sourcing businesses are recorded at the gross amount we charge our customers for the service we provide and goods we sell. In these transactions, we are the primary obligor, we have credit risk, we have discretion to select the supplier, and we have latitude in pricing decisions. Additionally, in our Sourcing business, we take loss of inventory risk during shipment and have general inventory risk. Certain transactions in customs brokerage, and transportation management services are recorded at the net amount we charge our customers for the service we provide because many of the factors stated above are not present.
ALLOWANCE FOR DOUBTFUL ACCOUNTS 
ALLOWANCE FOR DOUBTFUL ACCOUNTS. Accounts receivable are reduced by an allowance for amounts that may become uncollectible in the future. We continuously monitor payments from our customers and maintain a provision for uncollectible accounts based upon our customer aging trends, historical loss experience, and any specific customer collection issues that we have identified.
FOREIGN CURRENCY 
FOREIGN CURRENCY. Most balance sheet accounts of foreign subsidiaries are translated or remeasured at the current exchange rate as of the end of the year. Statement of operations items are translated at average exchange rates during the year. The resulting translation adjustment is recorded as a separate component of comprehensive income in our statement of operations and comprehensive income.
SEGMENT REPORTING AND GEOGRAPHIC INFORMATION 
SEGMENT REPORTING AND GEOGRAPHIC INFORMATION. We operate in the transportation and logistics industry. We provide a wide range of products and services to our customers and contract carriers including transportation services, produce sourcing, freight consolidation, contract warehousing, and information services. Each of these is a significant component to optimizing logistics solutions for our customers.
These services are performed throughout our branch offices, as an integrated offering for which our customers are typically provided a single invoice. Our branches work together to complete transactions and collectively meet the needs of our customers. For large multi-location customers, we often coordinate our efforts in one branch and rely on multiple branch locations to deliver specific geographic or modal needs. As an example, approximately 43 percent of our truckload transactions are shared transactions between branches. In addition, our methodology of providing services is very similar across all branches. The majority of our global network operates on a common technology platform that is used to match customer needs with supplier capabilities, to collaborate with other branch locations, and to utilize centralized support resources to complete all facets of the transaction. Accordingly, our chief operating decision maker analyzes our business as a single segment, relying on net revenues and operating income across our network of branch offices as the primary performance measures.
The following table presents our total revenues (based on location of the customer) and long-lived assets (including intangible and other assets) by geographic regions (in thousands):
 
 
For the year ended December 31,
 
2012
 
2011
 
2010
Total revenues
 
 
 
 
 
United States
$
10,183,596

 
$
9,488,165

 
$
8,298,324

Other locations
1,175,517

 
848,181

 
975,981

Total revenues
$
11,359,113

 
$
10,336,346

 
$
9,274,305

 
 
December 31,
 
2012
 
2011
 
2010
Long-lived assets
 
 
 
 
 
United States
$
281,729

 
$
156,471

 
$
135,312

Other locations
27,991

 
10,337

 
11,667

Total long-lived assets
$
309,720

 
$
166,808

 
$
146,979

CASH AND CASH EQUIVALENTS 
CASH AND CASH EQUIVALENTS. Cash and cash equivalents consist primarily of tax exempt and treasury money market funds with original maturities of less than 90 days. The carrying amount approximates fair value due to the short maturity of the instruments.
PREPAID EXPENSES AND OTHER 
PREPAID EXPENSES AND OTHER. Prepaid expenses and other include such items as prepaid rent, software maintenance contracts, insurance premiums, other prepaid operating expenses, and inventories, consisting primarily of produce and related products held for resale.
PROPERTY AND EQUIPMENT 
PROPERTY AND EQUIPMENT. Property and equipment are recorded at cost. Maintenance and repair expenditures are charged to expense as incurred. Depreciation is computed using the straight-line method over the estimated lives of the assets of 3 to 30 years. Amortization of leasehold improvements is computed over the shorter of the lease term or the estimated useful lives of the improvements.
We recognized the following depreciation expense (in thousands): 
2012
$
24,254

2011
23,410

2010
20,393


A summary of our property and equipment as of December 31 is as follows (in thousands):
 
 
2012
 
2011
Furniture, fixtures, and equipment
$
145,746

 
$
115,751

Buildings
64,452

 
55,682

Corporate aircraft
11,334

 
11,334

Leasehold improvements
22,663

 
17,781

Land
15,004

 
14,841

Construction in progress
5,808

 
4,684

Less accumulated depreciation
(115,156
)
 
(93,243
)
Net property and equipment
$
149,851

 
$
126,830



GOODWILL AND OTHER INTANGIBLE ASSETS 
GOODWILL AND OTHER INTANGIBLE ASSETS. Goodwill is the difference between the purchase price of a company and the fair market value of the acquired company’s net identifiable assets. Other intangible assets include customer lists, contract carrier lists, and non-competition agreements. These intangible assets are being amortized using the straight-line method over their estimated lives, ranging from 3 to 8 years. Goodwill is not amortized, but is tested for impairment using a fair value approach. Goodwill is tested for impairment annually or more frequently if events warrant. Intangible assets are evaluated for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. See Note 2.
OTHER ASSETS 
OTHER ASSETS. Other assets include such items as purchased and internally developed software, and the investments related to our nonqualified deferred compensation plan. We amortize software using the straight-line method over 3 years. We recognized the following amortization expense of purchased and internally developed software (in thousands):
 
2012
 
$
7,528

2011
 
5,180

2010
 
4,047


A summary of our purchased and internally developed software as of December 31 is as follows (in thousands):
 
 
2012
 
2011
Purchased software
$
15,524

 
$
14,111

Internally developed software
20,029

 
28,140

Less accumulated amortization
(20,744
)
 
(17,392
)
Net software
$
14,809

 
$
24,859

INCOME TAXES 
INCOME TAXES. Income taxes are accounted for using the asset and liability method. Under this method, deferred tax assets and liabilities are recognized for the future tax consequences of temporary differences between the carrying amounts and tax bases of assets and liabilities using enacted rates.
Annual tax provisions include amounts considered sufficient to pay assessments that may result from examination of prior year tax returns; however, the amount ultimately paid upon resolution of issues raised may differ from the amounts accrued.
The financial statement effects of an uncertain income tax position are recognized when it is more likely than not, based on the technical merits, that the position will be sustained upon examination. Unrecognized tax benefits are more likely than not owed to a taxing authority and the amount of the contingency can be reasonably estimated. Uncertain income tax positions are included in “Noncurrent income taxes payable” in the consolidated balance sheets.
Provisions are made for U.S. taxes on undistributed earnings of foreign subsidiaries and related companies.
COMPREHENSIVE INCOME 
COMPREHENSIVE INCOME. Comprehensive income includes any changes in the equity of an enterprise from transactions and other events and circumstances from non-owner sources. Our two components of other comprehensive income are foreign currency translation adjustment and unrealized gains and losses from investments. They are presented on our consolidated statements of operations and comprehensive income.
STOCK-BASED COMPENSATION 
STOCK-BASED COMPENSATION. The fair value of each share-based payment award is established on the date of grant. For grants of restricted shares and restricted units, the fair value is established based on the market price on the date of the grant, discounted for post-vesting holding restrictions. The discounts have varied from 12 percent to 22 percent and are calculated using the Black-Scholes option pricing model. Changes in measured stock volatility and interest rates are the primary reason for changes in the discount.
For grants of options, we use the Black-Scholes option pricing model to estimate the fair value of share-based payment awards. The determination of the fair value of share-based awards is affected by our stock price and a number of assumptions, including expected volatility, expected life, risk-free interest rate, and expected dividends.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)
Schedule Of Revenues From External Customers And Long Lived Assets By Geographical Areas Table 
The following table presents our total revenues (based on location of the customer) and long-lived assets (including intangible and other assets) by geographic regions (in thousands):
 
 
For the year ended December 31,
 
2012
 
2011
 
2010
Total revenues
 
 
 
 
 
United States
$
10,183,596

 
$
9,488,165

 
$
8,298,324

Other locations
1,175,517

 
848,181

 
975,981

Total revenues
$
11,359,113

 
$
10,336,346

 
$
9,274,305

 
 
December 31,
 
2012
 
2011
 
2010
Long-lived assets
 
 
 
 
 
United States
$
281,729

 
$
156,471

 
$
135,312

Other locations
27,991

 
10,337

 
11,667

Total long-lived assets
$
309,720

 
$
166,808

 
$
146,979

Schedule of Depreciation Expense 
We recognized the following depreciation expense (in thousands): 
2012
$
24,254

2011
23,410

2010
20,393

Property, Plant and Equipment 
A summary of our property and equipment as of December 31 is as follows (in thousands):
 
 
2012
 
2011
Furniture, fixtures, and equipment
$
145,746

 
$
115,751

Buildings
64,452

 
55,682

Corporate aircraft
11,334

 
11,334

Leasehold improvements
22,663

 
17,781

Land
15,004

 
14,841

Construction in progress
5,808

 
4,684

Less accumulated depreciation
(115,156
)
 
(93,243
)
Net property and equipment
$
149,851

 
$
126,830

Schedule of Amortization Expense of Software 
We recognized the following amortization expense of purchased and internally developed software (in thousands):
 
2012
 
$
7,528

2011
 
5,180

2010
 
4,047

Schedule of Other Assets, Noncurrent 
A summary of our purchased and internally developed software as of December 31 is as follows (in thousands):
 
 
2012
 
2011
Purchased software
$
15,524

 
$
14,111

Internally developed software
20,029

 
28,140

Less accumulated amortization
(20,744
)
 
(17,392
)
Net software
$
14,809

 
$
24,859

GOODWILL AND OTHER INTANGIBLE ASSETS (Tables)
Schedule of Goodwill 
The change in the carrying amount of goodwill is as follows (in thousands):
 
 
2012
 
2011
Balance, beginning of year
$
359,688

 
$
359,116

Acquisitions
462,232

 
2,009

Translation
295

 
(1,437
)
Balance, end of year
$
822,215

 
$
359,688

Schedule of Finite-Lived Intangible Assets by Major Class 
A summary of our other intangible assets, with finite lives, which include primarily customer relationships and non-competition agreements, as of December 31 is as follows (in thousands):
 
 
2012
 
2011
Gross
$
149,644

 
$
17,862

Accumulated amortization
(14,108
)
 
(9,708
)
Net
$
135,536

 
$
8,154

Schedule of Indefinite-lived Intangible Assets by Major Class 
Other intangible assets, with indefinite lives, are as follows (in thousands):
 
 
2012
 
2011
Trademarks
$
1,875

 
$
1,875

Schedule of Amortization Expense 
Amortization expense for other intangible assets was (in thousands):
 
2012
$
6,308

2011
3,908

2010
4,929

Schedule of Finite-Lived Intangible Assets, Future Amortization Expense 
Intangible assets at December 31, 2012 will be amortized over the next eight years, and that expense is as follows (in thousands):
 
 
2013
$
20,158

2014
18,719

2015
16,939

2016
16,922

2017
16,827

Thereafter
45,971

Total
$
135,536

FAIR VALUE MEASUREMENT (Tables)
Fair Value, by Balance Sheet Grouping 
The following table presents information as of December 31, 2012, about our financial assets and liabilities that are measured at fair value on a recurring basis, according to the valuation techniques we used to determine their fair values (in thousands).
 
 
Level 1
 
Level 2
 
Level 3
 
Total Fair
Value
December 31, 2012
 
 
 
 
 
 
 
Contingent purchase price related to acquisitions
—

 
—

 
922

 
922

Total liabilities at fair value
$
—

 
$
—

 
$
922

 
$
922

 
 
Level 1
 
Level 2
 
Level 3
 
Total Fair
Value
December 31, 2011
 
 
 
 
 
 
 
Contingent purchase price related to acquisitions
—

 
—

 
13,070

 
13,070

Total liabilities at fair value
$
—

 
$
—

 
$
13,070

 
$
13,070

Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation 
The table below sets forth a reconciliation of our beginning and ending Level 3 financial liability balance (in thousands).
 
 
2012
 
2011
 
2010
Balance, beginning of period
$
13,070

 
$
16,623

 
$
14,658

Payments of contingent purchase price
(12,661
)
 
(4,318
)
 
(445
)
Total unrealized losses included in earnings
513

 
765

 
2,410

Balance, end of period
$
922

 
$
13,070

 
$
16,623

INCOME TAXES (Tables)
Summary of Income Tax Contingencies 
A reconciliation of the beginning and ending amount of unrecognized tax benefits, excluding interest and penalties, is as follows (in thousands): 
 
2012
 
2011
 
2010
Unrecognized tax benefits, beginning of period
$
7,668

 
$
7,595

 
$
7,776

Additions based on tax positions related to the current year
4,172

 
1,476

 
1,891

Additions for tax positions of prior years
6,911

 
290

 
1,565

Reductions for tax positions of prior years
(1,061
)
 
(1,005
)
 
(1,544
)
Lapse in statute of limitations
(286
)
 
(688
)
 
(2,093
)
Settlements
(616
)
 
—

 
—

Unrecognized tax benefits, end of the period
$
16,788

 
$
7,668

 
$
7,595

Schedule of Components of Income Tax Expense (Benefit) 
The components of the provision for income taxes consist of the following for the years ended December 31 (in thousands):
 
 
2012
 
2011
 
2010
Tax provision:
 
 
 
 
 
Federal
$
326,708

 
$
219,124

 
$
195,843

State
38,931

 
28,260

 
25,492

Foreign
13,461

 
9,958

 
8,167

 
379,100

 
257,342

 
229,502

Deferred provision (benefit):
 
 
 
 
 
Federal
(11,674
)
 
4,781

 
4,397

State
(1,334
)
 
546

 
503

Foreign
(1,434
)
 
423

 
2,674


(14,442
)
 
5,750

 
7,574

Total provision
$
364,658

 
$
263,092

 
$
237,076

Schedule of Effective Income Tax Rate Reconciliation 
A reconciliation of the provision for income taxes using the statutory federal income tax rate to our effective income tax rate for the years ended December 31 is as follows: 
 
2012
 
2011
 
2010
Federal statutory rate
35.0
%
 
35.0
%
 
35.0
%
State income taxes, net of federal benefit
2.7

 
2.7

 
2.7

Other
0.3

 
0.2

 
0.3

 
38.0
%
 
37.9
%
 
38.0
%
Schedule of Deferred Tax Assets and Liabilities 
Deferred tax assets (liabilities) are comprised of the following at December 31 (in thousands): 
 
2012
 
2011
Deferred tax assets:
 
 
 
Compensation
$
96,660

 
$
80,577

Receivables
11,836

 
10,375

Other
9,443

 
7,992

Deferred tax liabilities:
 
 
 
Intangible assets
(109,334
)
 
(59,122
)
Prepaid assets
(7,825
)
 
(8,476
)
Long-lived assets
(21,171
)
 
(18,463
)
Undistributed earnings of foreign subsidiaries
(12,857
)
 
(5,324
)
Other
(85
)
 
(7
)
Net deferred tax (liabilities) assets
$
(33,333
)
 
$
7,552

CAPITAL STOCK AND STOCK AWARD PLANS (Tables)
Schedule of Employee Service Share-based Compensation, Allocation of Recognized Period Costs 
A summary of our total compensation expense recognized in our consolidated statements of operations and comprehensive income for stock-based compensation is as follows (in thousands):

 
2012
 
2011
 
2010
Stock options
 
$
3,585

 
$
61

 
$
1,539

Stock awards
 
53,481

 
36,390

 
33,519

Company expense on ESPP discount
 
2,315

 
2,150

 
1,989

Total stock based compensation expense
 
$
59,381

 
$
38,601

 
$
37,047

Schedule of Share-based Compensation, Stock Options, Activity 
The following schedule summarizes stock option activity in the plan. All outstanding unvested options as of December 31, 2012, relate to the performance-based grants from 2011 and 2012.
 
 
Shares
 
Weighted
Average
Exercise
Price
 
Aggregate
Intrinsic
Value
(in thousands)
 
Average
Remaining
Life
(years)
December 31, 2011
1,522,624

 
$
51.81

 
 
 
 
Grants
1,184,487

 
62.02

 
 
 
 
Exercised
(362,699
)
 
21.01

 
 
 
 
Terminated
(49,315
)
 
62.27

 
 
 
 
Outstanding at December 31, 2012
2,295,097

 
$
61.72

 
$
3,439

 
8.57
Vested at December 31, 2012
445,778

 
$
50.21

 
$
5,800

 
4.44
Exercisable at December 31, 2012
445,778

 
$
50.21

 
$
5,800

 
4.44
Schedule of Intrinsic Value of Options Exercised 
Information on the intrinsic value of options exercised is as follows (in thousands):
 
2012
$
15,516

2011
20,097

2010
43,485

Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions 
The fair value per option was estimated using the Black-Scholes option pricing model with the following assumptions:
 
 
2012 Grants
 
2011 Grants
 
2010 Grants
Risk-free interest rate
.18-.89%

 
.12-1.22%

 
.47-1.07%

Dividend per share (quarterly amounts)
$.33-.35

 
$.29-.33

 
$.25-.29

Expected volatility factor
26.0-27.5%

 
27.5-29.93%

 
30.2-31.2%

Expected option term
.01-6 years

 
.01-6 years

 
.01-3 years

Weighted average fair value per option
$
13.61

 
$
15.58

 
$
9.43

Schedule of Nonvested Restricted Stock Units Activity 
The following table summarizes our nonvested performance-based restricted stock grants as of December 31, 2012: 
 
Number of Restricted
Shares and Units
 
Weighted Average
Grant Date Fair Value
Nonvested at December 31, 2011
3,445,251

 
$
47.56

Granted
339,453

 
48.66

Vested
(1,095,134
)
 
46.35

Forfeitures
(120,982
)
 
46.55

Nonvested at December 31, 2012
2,568,588

 
$
48.26

Schedule of Share-based Compensation, Activity 
The following table summarizes performance-based shares and units by year of grant:
 
Year of grant
 
First vesting date
 
Last vesting date
 
Shares and units
granted, net of
forfeitures
 
Weighted
average grant
date fair value (1)
 
Shares and units
non-vested
2008
 
December 31, 2009
 
December 31, 2013
 
2,269,011

 
$
39.66

 
884,914

2009
 
December 31, 2010
 
December 31, 2014
 
904,167

 
44.06

 
415,917

2010
 
December 31, 2011
 
December 31, 2015
 
737,937

 
63.28

 
435,383

2011
 
December 31, 2012
 
December 31, 2016
 
650,058

 
53.73

 
494,044

2012
 
December 31, 2013
 
December 31, 2017
 
338,330

 
48.65

 
338,330

 
 
 
 
 
 
4,899,503

 
$
46.51

 
2,568,588

________________________ 
(1) Amount shown is the weighted average grant date fair value of shares and units granted, net of forfeitures.
Schedule of Share-based Compensation, Restricted Stock and Restricted Stock Units Activity 
The following table summarizes these nonvested restricted stock grants as of December 31, 2012: 
 
Number of Restricted
Shares and Units
 
Weighted Average
Grant Date Fair Value
Nonvested at December 31, 2011
99,462

 
$
18.07

Granted
456,930

 
48.60

Vested
(26,944
)
 
19.99

Forfeitures
(1,509
)
 
66.27

Nonvested at December 31, 2012
527,939

 
$
44.26

Schedule Of Fair Value Stock Awards Vested 
A summary of the fair value of restricted stock vested (in thousands):
 
2012
$
53,562

2011
35,663

2010
34,056

Schedule of Share-based Compensation, Employee Stock Purchase Plan, Activity 
The following is a summary of the employee stock purchase plan activity (dollar amounts in thousands):
 
 
 
Shares purchased
by employees
 
Aggregate cost
to employees
 
Expense recognized
by the company
2012
 
248,405

 
$
13,116

 
$
2,315

2011
 
196,332

 
12,183

 
2,150

2010
 
215,054

 
11,273

 
1,989

Share Repurchase Program Disclosure 
The activity under those programs for each of the periods reported is as follows (dollar amounts in thousands):
 
 
 
Shares repurchased
 
Total value of shares
repurchased
2007 Program
 
 
 
 
2008 Purchases
 
3,720,704

 
$
200,800

2009 Purchases
 
5,101,747

 
266,900

2010 Purchases
 
1,114,849

 
60,600


 
 
Shares repurchased
 
Total value of shares
repurchased
2009 Program
 
 
 
 
2010 Purchases

1,394,831


$
90,500

2011 Purchases
 
3,540,171

 
246,935

2012 Purchases
 
4,237,555

 
257,064

COMMITMENTS AND CONTINGENCIES (Tables)
Schedule of Costs of Retirement Plans 
Defined contribution plan expense, including matching contributions, was approximately (in thousands):
 
2012
$
24,769

2011
30,550

2010
28,293

Schedule of Lease Expenses 
Information regarding our lease expense is as follows (in thousands):
 
2012
$
41,689

2011
40,375

2010
36,945

Operating Leases of Lessee Disclosure 
Minimum future lease commitments under noncancelable lease agreements in excess of one year as of December 31, 2012, are as follows (in thousands):
 
2013
$
45,592

2014
38,301

2015
30,576

2016
22,523

2017
15,366

Thereafter
22,702

Total
$
175,060

ACQUISITIONS (Tables)
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed
The following is a preliminary summary of the allocation of purchase consideration to the estimated fair value of net assets for the acquisition of Phoenix (in thousands):
Cash and cash equivalents
$
75,372

Receivables
124,056

Other current assets
8,929

Property and equipment
12,160

Identifiable intangible assets
130,000

Goodwill
447,877

Other noncurrent assets
5,044

Total assets
$
803,438

 

Accounts payable
$
(45,367
)
Accrued expenses
(14,340
)
Other liabilities
(83,155
)
Estimated net assets acquired
$
660,576


Identifiable intangible assets and estimated useful lives are as follows (dollars in thousands):
 
Estimated Life (years)
 
 
Customer relationships
8
 
$
129,800

Noncompete agreements
5
 
200

Total identifiable intangible assets
 
 
$
130,000

SUPPLEMENTARY DATA (Tables)
Schedule of Quarterly Financial Information
Our unaudited results of operations for each of the quarters in the years ended December 31, 2012 and 2011 are summarized below (in thousands, except per share data).
 
2012
 
March 31
 
June 30
 
September 30
 
December 31 (1)
Total revenues:
 
 
 
 
 
 
 
 
Transportation
 
$
2,176,797

 
$
2,476,805

 
$
2,445,883

 
$
2,585,930

Sourcing
 
359,730

 
462,597

 
418,377

 
379,479

Payment Services
 
15,587

 
16,312

 
16,149

 
5,467

Total revenues
 
2,552,114

 
2,955,714

 
2,880,409

 
2,970,876

Costs and expenses:
 
 
 
 
 
 
 
 
Purchased transportation and related services
 
1,809,581

 
2,107,799

 
2,063,109

 
2,176,789

Purchased products sourced for resale
 
327,787

 
422,392

 
384,630

 
348,936

Purchased payment services
 
—

 
—

 
—

 
519

Personnel expenses
 
183,438

 
177,184

 
179,342

 
226,042

Other selling, general, and administrative expenses
 
61,763

 
63,425

 
66,071

 
84,986

Total costs and expenses
 
2,382,569

 
2,770,800

 
2,693,152

 
2,837,272

Income from operations
 
169,545

 
184,914

 
187,257

 
133,604

Net income
 
$
106,500

 
$
114,582

 
$
116,330

 
$
256,392

Basic net income per share
 
$
0.65

 
$
0.71

 
$
0.72

 
$
1.59

Diluted net income per share
 
$
0.65

 
$
0.71

 
$
0.72

 
$
1.58

Basic weighted average shares outstanding
 
162,693

 
161,887

 
160,782

 
160,880

Dilutive effect of outstanding stock awards
 
330

 
313

 
221

 
919

Diluted weighted average shares outstanding
 
163,023

 
162,200

 
161,003

 
161,799

Market price range of common stock:
 
 
 
 
 
 
 
 
High
 
$
71.76

 
$
67.31

 
$
61.97

 
$
64.14

Low
 
$
62.84

 
$
55.35

 
$
50.81

 
$
57.16

_________________________ 
(1)
The quarter ended December 31, 2012 is not comparable to the previous periods shown in this footnote due to certain significant charges or credits related to our recent acquisitions and divestitures.

2011
 
March 31
 
June 30
 
September 30
 
December 31
Total revenues:
 
 
 
 
 
 
 
 
Transportation
 
$
1,991,022

 
$
2,269,036

 
$
2,280,208

 
$
2,200,258

Sourcing
 
360,028

 
423,536

 
399,220

 
352,744

Payment Services
 
14,422

 
15,090

 
15,500

 
15,282

Total revenues
 
2,365,472

 
2,707,662

 
2,694,928

 
2,568,284

Costs and expenses:
 
 
 
 
 
 
 
 
Purchased transportation and related services
 
1,648,102

 
1,901,189

 
1,905,731

 
1,841,586

Purchased products sourced for resale
 
327,029

 
388,607

 
366,131

 
325,313

Personnel expenses
 
175,109

 
178,945

 
178,117

 
164,062

Other selling, general, and administrative expenses
 
58,517

 
58,826

 
60,984

 
65,368

Total costs and expenses
 
2,208,757

 
2,527,567

 
2,510,963

 
2,396,329

Income from operations
 
156,715

 
180,095

 
183,965

 
171,955

Net income
 
$
97,028

 
$
111,023

 
$
114,347

 
$
109,214

Basic net income per share
 
$
0.59

 
$
0.67

 
$
0.70

 
$
0.67

Diluted net income per share
 
$
0.59

 
$
0.67

 
$
0.70

 
$
0.67

Basic weighted average shares outstanding
 
165,124

 
164,607

 
163,948

 
162,919

Dilutive effect of outstanding stock awards
 
640

 
587

 
523

 
906

Diluted weighted average shares outstanding
 
165,764

 
165,194

 
164,471

 
163,825

Market price range of common stock:
 
 
 
 
 
 
 
 
High
 
$
82.05

 
$
81.53

 
$
82.61

 
$
76.76

Low
 
$
70.32

 
$
73.30

 
$
62.30

 
$
63.21

Summary of Significant Accounting Policies - Additional Information (Detail)
12 Months Ended
Dec. 31, 2012
Location
Significant Accounting Policies [Line Items]
 
Network of branch offices
276 
Shared transactions between branches
Our branches work together to complete transactions and collectively meet the needs of our customers. For large multi-location customers, we often coordinate our efforts in one branch and rely on multiple branch locations to deliver specific geographic or modal needs. As an example, approximately 43 percent of our truckload transactions are shared transactions between branches. 
Property and equipment, depreciation method
Depreciation is computed using the straight-line method over the estimated lives of the assets of 3 to 30 years. 
Intangible assets, amortization method
These intangible assets are being amortized using the straight-line method over their estimated lives, ranging from three to five years. 
Software
 
Significant Accounting Policies [Line Items]
 
Intangible assets, estimated lives (in years)
3 years 
Intangible assets, amortization method
We amortize software using the straight-line method over three years. 
Truckload Transactions
 
Significant Accounting Policies [Line Items]
 
Percentage of truckload transactions that are shared transactions between branches
43.00% 
Minimum
 
Significant Accounting Policies [Line Items]
 
Property and equipment, estimated lives (in years)
3 years 
Intangible assets, estimated lives (in years)
3 years 
Restricted shares and restricted units grants, discount for post-vesting holding restrictions
12.00% 
Maximum
 
Significant Accounting Policies [Line Items]
 
Property and equipment, estimated lives (in years)
30 years 
Intangible assets, estimated lives (in years)
8 years 
Restricted shares and restricted units grants, discount for post-vesting holding restrictions
22.00% 
Total Revenues Based on Location of the Customer and Long-Lived Assets by Geographic Regions (Detail) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 12 Months Ended
Dec. 31, 2012
Sep. 30, 2012
Jun. 30, 2012
Mar. 31, 2012
Dec. 31, 2011
Sep. 30, 2011
Jun. 30, 2011
Mar. 31, 2011
Dec. 31, 2012
Dec. 31, 2011
Dec. 31, 2010
Total revenues:
 
 
 
 
 
 
 
 
 
 
 
United States
 
 
 
 
 
 
 
 
$ 10,183,596 
$ 9,488,165 
$ 8,298,324 
Other locations
 
 
 
 
 
 
 
 
1,175,517 
848,181 
975,981 
Total revenues
2,970,876 1
2,880,409 
2,955,714 
2,552,114 
2,568,284 
2,694,928 
2,707,662 
2,365,472 
11,359,113 
10,336,346 
9,274,305 
United States
281,729 
 
 
 
156,471 
 
 
 
281,729 
156,471 
135,312 
Other locations
27,991 
 
 
 
10,337 
 
 
 
27,991 
10,337 
11,667 
Total
$ 309,720 
 
 
 
$ 166,808 
 
 
 
$ 309,720 
$ 166,808 
$ 146,979 
Depreciation Expense (Detail) (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 31, 2012
Dec. 31, 2011
Dec. 31, 2010
Disclosure Depreciation Expense [Abstract]
 
 
 
Depreciation expense
$ 24,254 
$ 23,410 
$ 20,393 
Summary of Property and Equipment (Detail) (USD $)
In Thousands, unless otherwise specified
Dec. 31, 2012
Dec. 31, 2011
Disclosure Summary Of Property And Equipment [Abstract]
 
 
Furniture, fixtures, and equipment
$ 145,746 
$ 115,751 
Buildings
64,452 
55,682 
Corporate aircraft
11,334 
11,334 
Leasehold improvements
22,663 
17,781 
Land
15,004 
14,841 
Construction in progress
5,808 
4,684 
Less accumulated depreciation
(115,156)
(93,243)
Net property and equipment
$ 149,851 
$ 126,830 
Amortization Expense of Purchased and Internally Developed Software (Detail) (Software, USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 31, 2012
Dec. 31, 2011
Dec. 31, 2010
Software
 
 
 
Finite-Lived Intangible Assets [Line Items]
 
 
 
Amortization expense
$ 7,528 
$ 5,180 
$ 4,047 
Summary of Purchased and Internally Developed Software (Detail) (USD $)
In Thousands, unless otherwise specified
Dec. 31, 2012
Dec. 31, 2011
Finite-Lived Intangible Assets [Line Items]
 
 
Less accumulated amortization
$ (14,108)
$ (9,708)
Net software
135,536 
 
Software
 
 
Finite-Lived Intangible Assets [Line Items]
 
 
Less accumulated amortization
(20,744)
(17,392)
Net software
14,809 
24,859 
Software |
Purchased software
 
 
Finite-Lived Intangible Assets [Line Items]
 
 
Software
15,524 
14,111 
Software |
Internally developed software
 
 
Finite-Lived Intangible Assets [Line Items]
 
 
Software
$ 20,029 
$ 28,140 
Change in the Carrying Amount of Goodwill (Detail) (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 31, 2012
Dec. 31, 2011
Goodwill [Roll Forward]
 
 
Balance, beginning of year
$ 359,688 
$ 359,116 
Acquisitions
462,232 
2,009 
Translation
295 
(1,437)
Balance, end of year
$ 822,215 
$ 359,688 
Summary of Other Intangible Assets, with Finite Lives (Detail) (USD $)
In Thousands, unless otherwise specified
Dec. 31, 2012
Dec. 31, 2011
Finite-Lived Intangible Assets [Line Items]
 
 
Accumulated amortization
$ (14,108)
$ (9,708)
Net
135,536 
 
Other Intangible Assets
 
 
Finite-Lived Intangible Assets [Line Items]
 
 
Gross
149,644 
17,862 
Accumulated amortization
(14,108)
(9,708)
Net
$ 135,536 
$ 8,154 
Other Intangible Assets, with Indefinite Lives (Detail) (USD $)
In Thousands, unless otherwise specified
Dec. 31, 2012
Dec. 31, 2011
Disclosure Other Intangible Assets With Indefinite Lives [Abstract]
 
 
Trademarks
$ 1,875 
$ 1,875 
Amortization Expense of Other Intangible Assets (Detail) (Other Intangible Assets, USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 31, 2012
Dec. 31, 2011
Dec. 31, 2010
Other Intangible Assets
 
 
 
Finite-Lived Intangible Assets [Line Items]
 
 
 
Amortization expense
$ 6,308 
$ 3,908 
$ 4,929 
Estimated Amortization Expense on Intangible Assets (Detail) (USD $)
In Thousands, unless otherwise specified
Dec. 31, 2012
Estimated amortization expense
 
2013
$ 20,158 
2014
18,719 
2015
16,939 
2016
16,922 
2017
16,827 
Thereafter
45,971 
Net
$ 135,536 
Financial Assets and Liabilities at Fair Value on a Recurring Basis (Detail) (Fair Value, Measurements, Recurring, USD $)
In Thousands, unless otherwise specified
Dec. 31, 2012
Dec. 31, 2011
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Contingent purchase price related to acquisitions
$ 922 
$ 13,070 
Total liabilities at fair value
922 
13,070 
Level 1
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Contingent purchase price related to acquisitions
0 
0 
Total liabilities at fair value
0 
0 
Level 2
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Contingent purchase price related to acquisitions
0 
0 
Total liabilities at fair value
0 
0 
Level 3
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Contingent purchase price related to acquisitions
922 
13,070 
Total liabilities at fair value
$ 922 
$ 13,070 
Reconciliation of Beginning and Ending Level 3 Financial Liability Balances (Detail) (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 31, 2012
Dec. 31, 2011
Dec. 31, 2010
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
 
 
 
Balance, beginning of period
$ 13,070 
$ 16,623 
$ 14,658 
Payments of contingent purchase price
(12,661)
(4,318)
(445)
Total unrealized losses included in earnings
513 
765 
2,410 
Balance, end of period
$ 922 
$ 13,070 
$ 16,623 
FINANCING ARRANGEMENTS (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2012
Oct. 29, 2012
Unsecured Debt |
Senior Unsecured Revolving Credit Facility 2017 Term Loan
 
 
Debt Instrument [Line Items]
 
 
Line of credit facility, maximum borrowing capacity
 
 500 
Additional borrowing capacity credit facility
 
500 
Debt, weighted average interest rate
1.20% 
 
Debt instrument, covenant, leverage ratio, maximum
0.65 
 
Current Liability
 
 
Debt Instrument [Line Items]
 
 
Borrowing outstanding
$ 253.0 
 
London Interbank Offered Rate (LIBOR) |
Unsecured Debt |
Senior Unsecured Revolving Credit Facility 2017 Term Loan
 
 
Debt Instrument [Line Items]
 
 
Debt instrument, basis spread on variable rate
 
1.00% 
Federal Funds Rate |
Unsecured Debt |
Senior Unsecured Revolving Credit Facility 2017 Term Loan
 
 
Debt Instrument [Line Items]
 
 
Debt instrument, basis spread on variable rate
 
0.50% 
LIBOR Rate Option |
Unsecured Debt |
Senior Unsecured Revolving Credit Facility 2017 Term Loan
 
 
Debt Instrument [Line Items]
 
 
Debt instrument, basis spread on variable rate
 
1.00% 
Debt instrument, description of variable rate basis
One-month LIBOR 
 
Reconciliation of Unrecognized Tax Benefits, Excluding Interest and Penalties (Detail) (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 31, 2012
Dec. 31, 2011
Dec. 31, 2010
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward]
 
 
 
Unrecognized tax benefits, beginning of period
$ 7,668 
$ 7,595 
$ 7,776 
Additions based on tax positions related to the current year
4,172 
1,476 
1,891 
Additions for tax positions of prior years
6,911 
290 
1,565 
Reductions for tax positions of prior years
(1,061)
(1,005)
(1,544)
Lapse in statute of limitations
(286)
(688)
(2,093)
Settlements
(616)
0 
0 
Unrecognized tax benefits, end of the period
$ 16,788 
$ 7,668 
$ 7,595 
Income Taxes - Additional Information (Detail) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2012
Dec. 31, 2011
Dec. 31, 2010
Disclosure Income Taxes Additional Information [Abstract]
 
 
 
Unrecognized tax benefits and related interest and penalties, all of which would affect our effective tax rate if recognized
$ 20.6 
 
 
Interest and penalties recognized
0.8 
0.8 
1.5 
Interest and penalties accrued
3.8 
2.8 
 
Foreign net operating loss carryforwards tax effect
$ 5.1 
 
 
Components of the Provision for Income Taxes (Detail) (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 31, 2012
Dec. 31, 2011
Dec. 31, 2010
Tax provision:
 
 
 
Federal
$ 326,708 
$ 219,124 
$ 195,843 
State
38,931 
28,260 
25,492 
Foreign
13,461 
9,958 
8,167 
Current Income Tax Expense (Benefit), Total
379,100 
257,342 
229,502 
Deferred provision (benefit):
 
 
 
Federal
(11,674)
4,781 
4,397 
State
(1,334)
546 
503 
Foreign
(1,434)
423 
2,674 
Deferred provision (benefit):
(14,442)
5,750 
7,574 
Total provision
$ 364,658 
$ 263,092 
$ 237,076 
Reconciliation of the Provision for Income Taxes using Statutory Federal Income Tax Rate to the Effective Income Tax Rate (Detail)
12 Months Ended
Dec. 31, 2012
Dec. 31, 2011
Dec. 31, 2010
Disclosure reconciliation of the provision for income taxes using statutory federal income tax rate to the effective income tax rate [Abstract]
 
 
 
Federal statutory rate
35.00% 
35.00% 
35.00% 
State income taxes, net of federal benefit
2.70% 
2.70% 
2.70% 
Other
0.30% 
0.20% 
0.30% 
Effective Income Tax Rate, Continuing Operations, Total
38.00% 
37.90% 
38.00% 
Deferred Tax Assets (Liabilities) (Detail) (USD $)
In Thousands, unless otherwise specified
Dec. 31, 2012
Dec. 31, 2011
Deferred tax assets:
 
 
Compensation
$ 96,660 
$ 80,577 
Receivables
11,836 
10,375 
Other
9,443 
7,992 
Deferred tax liabilities:
 
 
Intangible assets
(109,334)
(59,122)
Prepaid assets
(7,825)
(8,476)
Long-lived assets
(21,171)
(18,463)
Undistributed earnings of foreign subsidiaries
(12,857)
(5,324)
Other
(85)
(7)
Net deferred tax (liabilities) assets
$ (33,333)
$ 7,552 
Capital Stock and Stock Award Plans - Additional Information (Detail) (USD $)
12 Months Ended 12 Months Ended
Dec. 31, 2012
Vote
Dec. 31, 2011
Dec. 31, 2012
Restricted Stock Awards
Dec. 31, 2012
Stock Option
Dec. 31, 2007
2007 Program
Dec. 31, 2012
2009 Program
Dec. 31, 2009
2009 Program
Dec. 31, 2012
2012 Program
Compensation Related Costs Share Based Payments Disclosure [Line Items]
 
 
 
 
 
 
 
 
Preferred stock, shares authorized
20,000,000 
20,000,000 
 
 
 
 
 
 
Preferred stock, par value
$ 0.10 
$ 0.10 
 
 
 
 
 
 
Preferred stock, shares outstanding
0 
0 
 
 
 
 
 
 
Common stock, shares authorized
480,000,000 
480,000,000 
 
 
 
 
 
 
Common stock, par value
$ 0.10 
$ 0.10 
 
 
 
 
 
 
Entitled vote for each share of Common Stock
1 
 
 
 
 
 
 
 
Minimum percentage of outstanding Common Stock needed by holders of Common Stock to elect all of any class of directors if they choose to do so
50.00% 
 
 
 
 
 
 
 
Maximum shares that can be granted under stock plan
28,000,000 
 
 
 
 
 
 
 
Shares available for stock awards
3,642,000 
 
 
 
 
 
 
 
Stock award, vesting rights
These options are subject to certain vesting requirements over a five-year period, based on the company’s earnings growth. 
 
 
 
 
 
 
 
Stock award, vesting period
5 years 
 
5 years 
 
 
 
 
 
Unrecognized compensation expense
 
 
$ 147,300,000 
$ 26,000,000 
 
 
 
 
Restricted stock awards, discount for post-vesting holding restriction, lower limit
12.00% 
 
 
 
 
 
 
 
Restricted stock awards, discount for post-vesting holding restriction, upper limit
22.00% 
 
 
 
 
 
 
 
Maximum employee contribution to purchase company stock
$ 10,000 
 
 
 
 
 
 
 
Discount rate used to determine the purchase price
15.00% 
 
 
 
 
 
 
 
Repurchase program, number of additional shares authorized for repurchase
 
 
 
 
10,000,000 
 
10,000,000 
10,000,000 
Shares remaining for repurchase under authorization
 
 
 
 
 
827,443 
 
10,000,000 
Summary of Total Compensation Expense Recognized in Statements of Operations for Stock-Based Compensation (Detail) (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 31, 2012
Dec. 31, 2011
Dec. 31, 2010
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
Stock-based compensation expense
$ 59,381 
$ 38,601 
$ 37,047 
Stock options
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
Stock-based compensation expense
3,585 
61 
1,539 
Stock awards
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
Stock-based compensation expense
53,481 
36,390 
33,519 
Company expense on ESPP discount
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
Stock-based compensation expense
$ 2,315 
$ 2,150 
$ 1,989 
Summary of Stock Option Activity (Detail) (USD $)
In Thousands, except Share data, unless otherwise specified
12 Months Ended
Dec. 31, 2012
Options Outstanding - Number of Shares
 
December 31, 2011
1,522,624 
Grants
1,184,487 
Exercised
(362,699)
Terminated
(49,315)
Outstanding at December 31, 2012
2,295,097 
Vested at December 31, 2012
445,778 
Exercisable at December 31, 2012
445,778 
Options Outstanding - Weighted Average Exercise Price
 
December 31, 2011
$ 51.81 
Grants
$ 62.02 
Exercised
$ 21.01 
Terminated
$ 62.27 
Outstanding at December 31, 2012
$ 61.72 
Vested at December 31, 2012
$ 50.21 
Exercisable at December 31, 2012
$ 50.21 
Options Outstanding - Aggregate Intrinsic Value
 
Outstanding at December 31, 2012
$ 3,439 
Vested at December 31, 2012
5,800 
Exercisable at December 31, 2012
$ 5,800 
Options Outstanding - Average Remaining Life
 
Outstanding at December 31, 2012
8 years 6 months 26 days 
Vested at December 31, 2012
4 years 5 months 9 days 
Exercisable at December 31, 2012
4 years 5 months 9 days 
Intrinsic Value of Options Exercised (Detail) (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 31, 2012
Dec. 31, 2011
Dec. 31, 2010
Disclosure Intrinsic Value Of Options Exercised [Abstract]
 
 
 
Intrinsic value
$ 15,516 
$ 20,097 
$ 43,485 
Assumptions Used in Estimating the Fair Value Per Option (Detail)
12 Months Ended
Dec. 31, 2012
Dec. 31, 2011
Dec. 31, 2010
Share based Compensation Arrangement by Share based Payment Award, Fair Value Assumptions, Method Used [Line Items]
 
 
 
Risk-free interest rate, minimum
0.18% 
0.12% 
0.47% 
Risk-free interest rate, maximum
0.89% 
1.22% 
1.07% 
Expected volatility factor, minimum
26.00% 
27.50% 
30.20% 
Expected volatility factor, maximum
27.50% 
29.93% 
31.20% 
Weighted average fair value per option
$ 13.61 
$ 15.58 
$ 9.43 
Minimum
 
 
 
Share based Compensation Arrangement by Share based Payment Award, Fair Value Assumptions, Method Used [Line Items]
 
 
 
Dividend per share (quarterly amounts)
$ 0.33 
$ 0.29 
$ 0.25 
Expected option term, minimum
3 days 
3 days 
3 days 
Maximum
 
 
 
Share based Compensation Arrangement by Share based Payment Award, Fair Value Assumptions, Method Used [Line Items]
 
 
 
Dividend per share (quarterly amounts)
$ 0.35 
$ 0.33 
$ 0.29 
Expected option term, minimum
6 years 
6 years 
3 years 
Summary of Nonvested Performance-Based Restricted Stock Grants (Detail) (USD $)
12 Months Ended
Dec. 31, 2012
Nonvested Restricted Shares and Units - Number of Shares
 
Nonvested at December 31, 2012
2,568,588 
Nonvested Restricted Shares and Units - Weighted Average Grant Date Fair Value
 
Nonvested at December 31, 2012
$ 46.51 1
Performance Based Restricted Stock and Restricted Stock Units
 
Nonvested Restricted Shares and Units - Number of Shares
 
Nonvested at December 31, 2011
3,445,251 
Granted
339,453 
Vested
(1,095,134)
Forfeitures
(120,982)
Nonvested at December 31, 2012
2,568,588 
Nonvested Restricted Shares and Units - Weighted Average Grant Date Fair Value
 
Nonvested at December 31, 2011
$ 47.56 
Granted
$ 48.66 
Vested
$ 46.35 
Forfeitures
$ 46.55 
Nonvested at December 31, 2012
$ 48.26 
Summary of Performance Based Shares and Units by Year of Grant (Detail) (USD $)
12 Months Ended
Dec. 31, 2012
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
Shares and units granted, net of forfeitures
4,899,503 
Weighted average grant date fair value (1)
$ 46.51 1
Shares and units nonvested
2,568,588 
2008
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
Year of grant
2008 
Shares and units granted, net of forfeitures
2,269,011 
Weighted average grant date fair value (1)
$ 39.66 1
Shares and units nonvested
884,914 
2009
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
Year of grant
2009 
Shares and units granted, net of forfeitures
904,167 
Weighted average grant date fair value (1)
$ 44.06 1
Shares and units nonvested
415,917 
2010
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
Year of grant
2010 
Shares and units granted, net of forfeitures
737,937 
Weighted average grant date fair value (1)
$ 63.28 1
Shares and units nonvested
435,383 
2011
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
Year of grant
2011 
Shares and units granted, net of forfeitures
650,058 
Weighted average grant date fair value (1)
$ 53.73 1
Shares and units nonvested
494,044 
2012
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
Year of grant
2012 
Shares and units granted, net of forfeitures
338,330 
Weighted average grant date fair value (1)
$ 48.65 1
Shares and units nonvested
338,330 
Summary of Nonvested Restricted Stock Grants (Detail) (USD $)
12 Months Ended
Dec. 31, 2012
Nonvested Restricted Shares and Units - Number of Shares and Units
 
Nonvested at December 31, 2012
2,568,588 
Nonvested Restricted Shares and Units - Weighted Average Grant Date Fair Value
 
Nonvested at December 31, 2012
$ 46.51 1
Restricted Stock and Restricted Stock Units
 
Nonvested Restricted Shares and Units - Number of Shares and Units
 
Nonvested at December 31, 2011
99,462 
Granted
456,930 
Vested
(26,944)
Forfeitures
(1,509)
Nonvested at December 31, 2012
527,939 
Nonvested Restricted Shares and Units - Weighted Average Grant Date Fair Value
 
Nonvested at December 31, 2011
$ 18.07 
Granted
$ 48.60 
Vested
$ 19.99 
Forfeitures
$ 66.27 
Nonvested at December 31, 2012
$ 44.26 
Summary of Fair Value of Restricted Stock Vested (Detail) (Restricted Stock and Restricted Stock Units, USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 31, 2012
Dec. 31, 2011
Dec. 31, 2010
Restricted Stock and Restricted Stock Units
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
Fair value
$ 53,562 
$ 35,663 
$ 34,056 
Summary of Employee Stock Purchase Plan Activity (Detail) (USD $)
In Thousands, except Share data, unless otherwise specified
12 Months Ended
Dec. 31, 2012
Dec. 31, 2011
Dec. 31, 2010
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
Shares purchased by employees
248,405 
196,332 
215,054 
Aggregate cost to employees
$ 13,116 
$ 12,183 
$ 11,273 
Expense recognized by the company
59,381 
38,601 
37,047 
Company expense on ESPP discount
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
Expense recognized by the company
$ 2,315 
$ 2,150 
$ 1,989 
Share Repurchase Programs Activity (Detail) (USD $)
In Thousands, except Share data, unless otherwise specified
12 Months Ended
Dec. 31, 2012
Dec. 31, 2011
Dec. 31, 2010
Dec. 31, 2010
2007 Program
Dec. 31, 2009
2007 Program
Dec. 31, 2008
2007 Program
Dec. 31, 2012
2009 Program
Dec. 31, 2011
2009 Program
Dec. 31, 2010
2009 Program
Compensation Related Costs Share Based Payments Disclosure [Line Items]
 
 
 
 
 
 
 
 
 
Shares repurchased
 
 
 
1,114,849 
5,101,747 
3,720,704 
4,237,555 
3,540,171 
1,394,831 
Total value of shares repurchased
$ 257,064 
$ 246,935 
$ 151,057 
$ 60,600 
$ 266,900 
$ 200,800 
$ 257,064 
$ 246,935 
$ 90,500 
Profit-Sharing Plan Expense, Including Matching Contributions (Detail) (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 31, 2012
Dec. 31, 2011
Dec. 31, 2010
Disclosure Profit Sharing Plan Expense Including Matching Contributions [Abstract]
 
 
 
Profit-sharing plan expense
$ 24,769 
$ 30,550 
$ 28,293 
Defined contribution match
4.00% 
 
 
Commitments and Contingencies - Additional Information (Detail) (Nonqualified Deferred Compensation Plan, USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2012
Dec. 31, 2011
Nonqualified Deferred Compensation Plan
 
 
Commitments and Contingencies Disclosure [Line Items]
 
 
Defined Benefit Plan Contributions Percent Of Compensation
100.00% 
 
Accumulated benefit obligation
$ 0.9 
$ 1.0 
Investments to fund a future liability, market value
$ 0.9 
$ 1.0 
Lease Expense (Detail) (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 31, 2012
Dec. 31, 2011
Dec. 31, 2010
Disclosure Lease Expense [Abstract]
 
 
 
Lease expense
$ 41,689 
$ 40,375 
$ 36,945 
Minimum Future Lease Commitments Under Noncancelable Lease Agreements (Detail) (USD $)
In Thousands, unless otherwise specified
Dec. 31, 2012
Disclosure Minimum Future Lease Commitments Under Noncancelable Lease Agreements [Abstract]
 
2013
$ 45,592 
2014
38,301 
2015
30,576 
2016
22,523 
2017
15,366 
Thereafter
22,702 
Total
$ 175,060 
Acquisitions - Additional Information (Detail) (USD $)
Share data in Millions, unless otherwise specified
12 Months Ended 0 Months Ended 12 Months Ended 1 Months Ended 3 Months Ended
Dec. 31, 2012
Dec. 31, 2011
Dec. 31, 2010
Nov. 1, 2012
Phoenix
Dec. 31, 2012
Phoenix
Dec. 31, 2011
Phoenix
Oct. 2, 2012
Apreo
Sep. 30, 2011
Timco Worldwide
Dec. 31, 2012
T-Chek
Oct. 16, 2012
T-Chek
Business Acquisition [Line Items]
 
 
 
 
 
 
 
 
 
 
Business acquisition, purchase price
 
 
 
$ 660,576,000 
 
 
 
 
 
 
Business acquisition, equity interest issued or issuable, value assigned
 
 
 
60,200,000 
 
 
 
 
 
 
Business acquisition, equity interest issued or issuable, number of shares
 
 
 
1.1 
 
 
 
 
 
 
Business acquisition, acquisition price financed with debt
 
 
 
173,000,000 
 
 
 
 
 
 
Business acquisition, cost of acquired entity, transaction costs
 
 
 
9,900,000 
 
 
 
 
 
 
Business acquisition, pro forma revenue
 
 
 
 
12,100,000,000 
11,200,000,000 
 
 
 
 
Business acquisition, pro forma operating income
 
 
 
 
707,400,000 
729,600,000 
 
 
 
 
Business acquisition, pro forma net income
 
 
 
 
610,700,000 
445,800,000 
 
 
 
 
Business acquisition, pro forma amortization expense
 
 
 
 
13,600,000 
16,300,000 
 
 
 
 
Business acquisition, pro forma interest expense
 
 
 
 
2,200,000 
2,600,000 
 
 
 
 
Business acquisition, pro forma professional fees
 
 
 
 
18,500,000 
 
 
 
 
 
Business acquisition, pro forma compensation related expenses
 
 
 
 
6,500,000 
4,100,000 
 
 
 
 
Business acquisition, pro forma consolidated effective tax rate
 
 
 
 
6,900,000 
1,800,000 
 
 
 
 
Long lived assets held-for-sale, proceeds from sale
 
 
 
 
 
 
 
 
 
302,500,000 
Gain on sale of T-Chek
281,551,000 
0 
0 
 
 
 
 
 
281,600,000 
 
Business acquisition, cash paid
 
 
 
 
 
 
26,500,000 
 
 
 
Business acquisition, goodwill and other intangible assets
 
 
 
 
 
 
17,400,000 
2,400,000 
 
 
Business acquisition, liabilities assumed
 
 
 
 
 
 
 
$ 3,800,000 
 
 
Business acquisition, goodwill and other intangible assets tax deductible term
 
 
 
 
 
 
 
15 years 
 
 
ACQUISITIONS Acquisitions - Business Combination (Details) (USD $)
In Thousands, unless otherwise specified
Dec. 31, 2012
Dec. 31, 2011
Dec. 31, 2010
Nov. 1, 2012
Phoenix
Business Acquisition [Line Items]
 
 
 
 
Cash and cash equivalents
 
 
 
$ 75,372 
Receivables
 
 
 
124,056 
Other current assets
 
 
 
8,929 
Property and equipment
 
 
 
12,160 
Identifiable intangible assets
 
 
 
130,000 
Goodwill
822,215 
359,688 
359,116 
447,877 
Other noncurrent assets
 
 
 
5,044 
Total assets
 
 
 
803,438 
Accounts payable
 
 
 
(45,367)
Accrued expenses
 
 
 
(14,340)
Other liabilities
 
 
 
(83,155)
Estimated net assets acquired
 
 
 
$ 660,576 
ACQUISITIONS Acquisitions - Identifiable Intangible Assets and Estimated Useful Lives (Details) (Phoenix, USD $)
In Thousands, unless otherwise specified
0 Months Ended
Nov. 1, 2012
Business Acquisition [Line Items]
 
Identifiable intangible assets
$ 130,000 
Customer Relationships [Member]
 
Business Acquisition [Line Items]
 
Estimated Life (years)
8 years 
Identifiable intangible assets
129,800 
Noncompete Agreements [Member]
 
Business Acquisition [Line Items]
 
Estimated Life (years)
5 years 
Identifiable intangible assets
$ 200 
Summary of Unaudited Results of Operations for Each Quarter (Detail) (USD $)
In Thousands, except Per Share data, unless otherwise specified
3 Months Ended 12 Months Ended
Dec. 31, 2012
Sep. 30, 2012
Jun. 30, 2012
Mar. 31, 2012
Dec. 31, 2011
Sep. 30, 2011
Jun. 30, 2011
Mar. 31, 2011
Dec. 31, 2012
Dec. 31, 2011
Dec. 31, 2010
Total revenues:
 
 
 
 
 
 
 
 
 
 
 
Transportation
$ 2,585,930 1
$ 2,445,883 
$ 2,476,805 
$ 2,176,797 
$ 2,200,258 
$ 2,280,208 
$ 2,269,036 
$ 1,991,022 
$ 9,685,415 
$ 8,740,524 
$ 7,575,659 
Sourcing
379,479 1
418,377 
462,597 
359,730 
352,744 
399,220 
423,536 
360,028 
1,620,183 
1,535,528 
1,643,174 
Payment Services
5,467 1
16,149 
16,312 
15,587 
15,282 
15,500 
15,090 
14,422 
53,515 
60,294 
55,472 
Total revenues
2,970,876 1
2,880,409 
2,955,714 
2,552,114 
2,568,284 
2,694,928 
2,707,662 
2,365,472 
11,359,113 
10,336,346 
9,274,305 
Costs and expenses:
 
 
 
 
 
 
 
 
 
 
 
Purchased transportation and related services
2,176,789 1
2,063,109 
2,107,799 
1,809,581 
1,841,586 
1,905,731 
1,901,189 
1,648,102 
8,157,278 
7,296,608 
6,302,530 
Purchased products sourced for resale
348,936 1
384,630 
422,392 
327,787 
325,313 
366,131 
388,607 
327,029 
1,483,745 
1,407,080 
1,503,797 
Purchased payment services
519 1
0 
0 
0 
 
 
 
 
519 
0 
0 
Personnel expenses
226,042 1
179,342 
177,184 
183,438 
164,062 
178,117 
178,945 
175,109 
766,006 
696,233 
632,064 
Other selling, general, and administrative expenses
84,986 1
66,071 
63,425 
61,763 
65,368 
60,984 
58,826 
58,517 
276,245 
243,695 
213,054 
Total costs and expenses
2,837,272 1
2,693,152 
2,770,800 
2,382,569 
2,396,329 
2,510,963 
2,527,567 
2,208,757 
10,683,793 
9,643,616 
8,651,445 
Income from operations
133,604 1
187,257 
184,914 
169,545 
171,955 
183,965 
180,095 
156,715 
675,320 
692,730 
622,860 
Net income
$ 256,392 1
$ 116,330 
$ 114,582 
$ 106,500 
$ 109,214 
$ 114,347 
$ 111,023 
$ 97,028 
$ 593,804 
$ 431,612 
$ 387,026 
Basic net income per share (in dollars per share)
$ 1.59 1
$ 0.72 
$ 0.71 
$ 0.65 
$ 0.67 
$ 0.70 
$ 0.67 
$ 0.59 
$ 3.68 
$ 2.63 
$ 2.35 
Diluted net income per share (in dollars per share)
$ 1.58 1
$ 0.72 
$ 0.71 
$ 0.65 
$ 0.67 
$ 0.70 
$ 0.67 
$ 0.59 
$ 3.67 
$ 2.62 
$ 2.33 
Basic weighted average shares outstanding
160,880 1
160,782 
161,887 
162,693 
162,919 
163,948 
164,607 
165,124 
161,557 
164,114 
164,909 
Dilutive effect of outstanding stock awards
919 1
221 
313 
330 
906 
523 
587 
640 
389 
627 
1,063 
Diluted weighted average shares outstanding
161,799 1
161,003 
162,200 
163,023 
163,825 
164,471 
165,194 
165,764 
161,946 
164,741 
165,972 
Market price range of common stock:
 
 
 
 
 
 
 
 
 
 
 
High (in dollars per share)
$ 64.14 1
$ 61.97 
$ 67.31 
$ 71.76 
$ 76.76 
$ 82.61 
$ 81.53 
$ 82.05 
 
 
 
Low (in dollars per share)
$ 57.16 1
$ 50.81 
$ 55.35 
$ 62.84 
$ 63.21 
$ 62.30 
$ 73.30 
$ 70.32 
 
 
 
Transactions in the Allowance for Doubtful Accounts (Detail) (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 31, 2012
Dec. 31, 2011
Dec. 31, 2010
Movement in Valuation Allowances and Reserves [Roll Forward]
 
 
 
Balance, beginning of year
$ 31,328 
$ 30,945 
$ 30,651 
Provision
10,459 
9,052 
13,922 
Write-offs
(7,227)
(8,669)
(13,628)
Balance, end of year
$ 34,560 
$ 31,328 
$ 30,945