Welcome to the C.H. Robinson fourth quarter 2008 conference call. At this time all participants are in a listen only mode. Following the presentation instructions will be given for the question-and-answer session. (Operator Instructions) As a reminder this conference is being recorded, Tuesday, January 27th of 2009. I would now like to turn the conference over to Angie Freeman, C.H. Robinson Vice President of Investor Relations.

On our call today will be John Wiehoff, CEO and Chad Lindbloom, Senior Vice President and Chief Financial Officer. John and Chad will provide some prepared comments on the highlights of our fourth quarter and full year performance and we will follow that with a question-and-answer session. I would like to remind you that comments made by John, Chad or others representing C.H. Robinson may contain forward-looking statements which are subject to risks and uncertainties. Our SEC filings contain additional information about factors that could cause actual results to differ from management’s expectations. With that I’ll turn the call over to John.

Thanks to everybody who’s taking the time to listen in to our fourth quarter call. About an hour ago we issued our press release that shares the fourth quarter and annual results for 2008. I’m going to start by highlighting just a couple of the key financial results on that release. For the fourth quarter ended December 31st, 2008 our gross revenues were essentially flat at $1.9 billion. Our net revenues increased 6.6% to $344 million. Income from operations was up 7.2% to $142 million. Net income increased 4.3% to $89 million and fully diluted EPS increased 6.1% to $0.52 per share. Our year to date results for the 12 months ended 12/31/2008 gross revenue increased 17.3% to $8.6 billion. Our net revenues increased 10.5% to $1.4 billion. Income from operations was up 12.1% to $572 million. Net income increased 10.8% to $359 million and fully diluted EPS increased 11.8% to $2.08 per share. In addition to these high level financial results our press release gives more details and growth percentages by the various service offerings so I won’t cover those now. As Angie said consistent with the past myself and Chad are going to share a few prepared comments on certain things that we think are good to understand and then we’ll open up the lines for questions. In terms of prepared comments overall I would start by stating that we feel pretty good about our fourth quarter of 2008 and the year. As we all know the economic environment was not real good this year and the fourth quarter was particularly weak. We were able to grow each quarter and had double digit earnings growth for the year. Overall we consider 2008 another successful year for C.H. Robinson, the employees and the shareholders. While we feel the year…

I’m going to give some comments on our balance sheet, operating expenses, capital expenditures and share repurchase activity. Starting with the balance sheet, accounts receivable is our biggest asset. Most of these receivables have 30 day terms. We don’t extend any long term credit to any of our customers. The receivables turn quickly and because of this we tend to find out about problems relatively quickly. We are being as proactive as ever in managing those receivables and will continue to monitor the financial strength of our customer base and make adjustments to their terms and limits if the situation warrants it on a case by case basis. We did continue to see significant increase in our provision for doubtful accounts during the quarter. Our total provision was $4.3 million for the quarter and $14.3 million for the year. Both of these are more than double of what 2008 was. The primary driver of this is we did have a higher level of customer specific issues than we typically experience. It is very difficult for us to predict what other accounts will have issues in the future but we do feel comfortable with our current level of reserves. As John mentioned we did have an extremely strong cash flow quarter. Our cash and investment balance increased to approximately $500 million at the end of the year. We continue to invest our cash with the focus on principle preservation rather than maximizing yields. Our current interest bearing cash and investments are split primarily between municipal money markets and treasury money market funds. Our investment income is down significantly compared to last year primarily due to the changes in the overall market yields on high quality short term investments. Our non-cash working capital primarily made up of our accounts receivable and accounts…

(Operator Instructions) Our first question comes from Justin B. Yagerman – Wachovia Capital Markets. Justin B. Yagerman – Wachovia Capital Markets: I guess digging in, you were talking about headcount for a bit and it’s down slightly sequentially and obviously still up year-over-year. Obviously margin expansion, variable comp are ways that you can have stock gap measures to offset some of the deterioration in the environment if it continues, but how do you manage headcount versus what you’re seeing in the economy and leave yourself room? How fast do you move on that if you continue to see an environment like you were seeing in December and now in January?

I guess it starts with two premises, one that with our 220 locations we do manage the headcount and the personnel relationships in a fairly decentralized manner because we at all times do have variances across modes and services and in each of the different regions where growth may be occurring. In any environment, we’re typically adding people in some areas and subtracting in others. We’ll continue to manage it and oversee it on a decentralized basis and make sure that the network is adjusting in all locations to whatever the demand would be. As with I think we’ve talked before, we think of it as from a supervisory standpoint to make sure that we’re adjusting and adhering to the metrics in all of the different markets and that the overall outcome becomes the combination of what happens in each of those locations. We also believe that we have a higher degree of variable compensation components in our model than most companies so we know that we have a fair amount of flexibility as to how compensation and incentives will adjust automatically based upon the level of activity. If in a normal year, in normal circumstances or really in all years we have a certain amount of voluntary attrition or performance based attrition and typically what we’ll do is just not replace turnover from those two sources. Historically that has always been adequate to allow us to contract where we need to and that’s the mode we’re in today is very reluctant and not really replacing any voluntary or performance based turnover attrition. We’ll just monitor it as we go and make sure that that stays adequate to adjust. Justin B. Yagerman – Wachovia Capital Markets: That’s fair and sounds like a good strategy there. When I go back in my model and I look at time periods historically and there are very few when you guys have seen gross profits decline on a year-over-year basis in the truck division, I have to back to I think the first half of 2002. Can you refresh our memory as to what was going on at that point and what was driving that decline and if you have any corollary between that environment and this environment that you’d be able to extrapolate or how you might see those two environments as different and why maybe it wouldn’t be proper to compare the two?

I would say what’s probably most analogous about all the declining periods including 2001, 2002 is that when volume starts to soften for a period of time, we’ll see less growth in the volume and some expansion of margin. I don’t know exactly what period we might be comparing to or looking but I know in 2001, 2002 we had some very low modest net revenue trucking growth quarters where volumes were close to flat and margins were improving a little bit. That would essentially be what was happening during a lot of 2008 is that our volume growth was slowing and margins were expanding. What probably feels a little bit unique this time around I guess is that the time period is extending and after a year or more of declining volumes and expanding margins, the year ending with a pretty significant decline in freight demand in the marketplace accentuating some of those. Again the foundation of our caution is who knows what 2009 is going to look like, but if we continue to see softening in the demand and we’re getting deeper into a soft demand cycle, the opportunity for margin expansion goes away from a comparison standpoint and it gets tougher and tougher. Probably very similar until maybe the very end of 2008 where it starts to feel a little bit different. Justin B. Yagerman – Wachovia Capital Markets: When I think about the LTL business which you guys have been growing, how big a piece of truck is that or was that in the fourth quarter or maybe in 2008, if you have that? How much room do you see for that to grow and has that been a more profitable piece of business for you in this environment maybe because of how much slack in capacity there is in LTL that you may be able to exploit in this environment?

Historically it’s been around 10%. Going back a couple years as it’s grown faster than the truck mode, Chad’s showing me it’s between 12% and 13% now of the truck category. It’s inched up a little bit over the last couple of years as it’s done well. I think maybe we’ve articulated before that we think there’s a handful of reasons that go together as to why we’re doing better in LTL. Clearly we’ve had a point of emphasis on it the last five to 10 years like I talked in my prepared comments that we’re putting much more effort and energy into it, into the systems capabilities, into the carrier relationships, into our routing models and all the rest of that to try to do more with it. I also believe that in the short term with all of the challenge and disarray in the marketplace there are wide variances in pricing and opportunities in the marketplace combined with a lot of uncertainty as to the different types of providers and what might make the most sense. I think our fundamental premise that we can bring our expertise and our systems in and help a shipper sort trough what might be a good long term solution with more flexibility on how to handle it is just selling well today. You put all that together and it’s worked well for us. Justin B. Yagerman – Wachovia Capital Markets: Last before I turn it over to someone else, when I look at SG&A it’s definitely creeping up some and I guess with doubtful accounts going up that explains a bit of it, but is some of that an additional cost in terms of going out and trying to drum up the business that’s out there and how would you think about that in terms of if we are going into more of a prolonged down environment? Does that business spend get curtailed as well and do we have more leverage on that line than maybe we’ve been seeing in the back half of this year?

First the biggest variance in our non-personnel operating expenses is the credit and finance or the provision for doubtful accounts that we talked about all year long as the increase is being driven primarily based on customer specific issues within our customer portfolio. We’ve also over the year commented on growth in occupancy, a big part of that is we did have for most of the year we had about 20% more square feet than we did in 2007. Part of that started to anniversary itself because a big portion of that increase was our new North American headquarters which we had half of for half the quarter of 2007. So the growth in that particular line item has slowed down a little bit, but you’re right. Our people did remain very active in the marketplace which I think in the long term will pay us dividends and will continue to pay us dividends. My guess is some of those other operating expenses we would sure hope that the growth in things like credit and finance or the bad debt provision and occupancy would slow during 2009.

Our next question comes from Alexander Brand – Stephens Inc. Alexander Brand – Stephens Inc.: This is actually George Pickerel for Alex. Chad, real quick, I’m sorry I missed it, what was the Q4 doubtful account number?

It was for the quarter $4.3 million. Alexander Brand – Stephens Inc.: You mentioned in the press release that your gross profit per business day declined in December. Is there any way you could give us how much it increased in October and November and then how much it declined in December?

The comment was specifically about North American truckload and on a per business day basis, we were down about 4% in net revenue in December. Alexander Brand – Stephens Inc.: And how about October and November?

They were both slight increases, in the 4% to 5% range of growth.

One thing that we’ve talked before that when we look at our growth metrics one way is per month and per quarter, the other is per business day. There was a pretty significant fluctuation of business days in the quarter when you compare months so for instance December had two more business days this year than last year and when we break it down, you start to get into peak season, quarter end, how many business days were there, where did the holidays fall. It gets a little challenging to decide what’s the most reliable metric to know exactly what the trends are. So just be cautious that that’s one per business day metric that may or may not be the most revealing in terms of the growth trends. Alexander Brand – Stephens Inc.: Moving over to your intermodal sector, volumes were impressive there. Is there any way to quantify how much of that volume growth was due to brokerage customers or existing customers switching over to intermodal from brokerage?

It’s difficult to be precise but we believe the majority of it is, that when we approach the business as I talked in the prepared comments, we’re working largely with customers that have both truck and intermodal freight and are working with them to try to optimize what the best routing might be and what’s the optimum solution for any one shipment or any one period of time. We do have some intermodal customers where we’re only working with them on an intermodal basis but the vast majority of it is what we would we all a multi-modal customer where a lot of the freight is fluid and can go either mode depending upon what’s most economical and what the circumstances will allow. We believe that a high percentage of that growth was driven by customers that we would call mode conversion opportunities where we’re working with both modes of transportation. Alexander Brand – Stephens Inc.: I just have two quick questions and then I’ll turn it over. Any impact to your Budweiser business from the Inbev acquisition, positive or negative or indifferent?

Nope, no difference to date but we have had a lot of discussions with them. Their world is certainly changing and their approach to the marketplace is changing so we’ll definitely be staying as close to them as any account that we have. I think we’re optimistic. We’ve had a good long term relationship with them and from at least what I’ve seen personally in terms of how they’re evolving the business model and how they’re changing their approach to the marketplace, we feel pretty good about continuing that relationship and hopefully expanding it. Alexander Brand – Stephens Inc.: Lastly, I’m sorry if I missed it, but could you tell me how much if any of a reversal you had for bonus accruals in the fourth quarter?

No reversal but each quarter we have a fairly significant accrual based upon the performance of each of the different locations and because the earnings growth rate was less the accrual would be less for the quarter. So no reversal but less expense associated with the revenue growth.

Our next question comes from Thomas Wadewitz – J.P. Morgan. Thomas Wadewitz – J.P. Morgan: I wanted to see if I could your numbers, if you’re willing to provide this, on the truckload volumes by month. Is that something you’re willing to disclose?

This is purely North American truckload on a, again this goes back to that caveat John mentioned earlier, on a per business day basis or a total month basis and we think neither way is completely accurate to look at it because some freight there’s monthly cycles and some just depends on how many business days there is. But if you look at on a per business day basis October was flat, November was down 2% and December was down approximately 11%. Thomas Wadewitz – J.P. Morgan: So far in January any sense of whether it looks, if you want to give a number that’s great, but directionally does it look like a greater decline than you saw in December or similar?

Slightly smaller. This is through actually yesterday so 17 business days compared to 17 business days and volume down about 8% and net revenue down about 1%. Again we have no idea based on the volatility of the current market to know whether that is a good representation of even the whole month of January much less the quarter or the year in 2009. Thomas Wadewitz – J.P. Morgan: When you look at the capacity side and what you’re paying for capacity, how did that trend through the quarter? It seems like in second quarter, third quarter you were paying more for capacity. Obviously demand fell a lot so I presume that you’re paying less, but any comments on what you paid for capacity in fourth quarter and maybe what that might look like in early ’09?

It definitely did drop off during the quarter as did the prices to our customers but the capacity price fell slightly quicker and it’s continued to look similar to December and January as far as pricing environment goes. Thomas Wadewitz – J.P. Morgan: What do you think, the gross margin was really impressive in the quarter and that obviously give you some support for the earnings. Do you think you can run for a couple more quarters with a pretty high gross margin level given that obviously there’s excess capacity in the market or are you cautious on that in terms of maybe supply reduction starts to have an impact relatively quickly?

The biggest thing to remember throughout 2009 is the single biggest impact on gross margin percentages is the price of fuel. As that peaked later on, a lot of what you’re seeing for margin expansion during the fourth quarter of 2008 is simply the total invoice cost or the total billing coming down for the fuel component of it. Depending upon what part of the year we’re in next year and what fuel prices are doing, that will probably be the greatest driver of that margin percentage. From the standpoint of overall gross margins or net revenues on our activity, there is certainly some room in the beginning half of the year for a little bit of margin expansion to make up for some of the volume activity similar to what you saw in the fourth quarter. But again depending upon how 2009 shapes up, if it continues to get softer the whole year, at some point margin expansion runs out of steam. If like many people are speculating that by the second half of 2009 things start to get a little bit stronger, hopefully there’ll be better volume comparisons and we’ll get some volume growth and then at that point, your margins will start to level off or maybe even contract a little bit if the historical patterns would follow. Thomas Wadewitz – J.P. Morgan: One more question or maybe two questions, just on the comp and benefits, you made some comments which seemed to indicate that the ability of the personnel expenses as a percent of revenue would decline pretty nicely in 2008, that maybe we shouldn’t expect that in 2009. I’m wondering is that a function of you’ve already had a pretty fair reduction in incentive payout and so the magnitude of further reduction is a lot more modest? What is that would be behind those comments assuming I’m reading that right?

That’s certainly part of it and we’ve talked several times in the past about additional restricted stock awards that happened near the end of 2008 that when we’re growing will provide incremental expense as well. Probably the main thing too is just that while we have a lot of variability in the compensation model that if in fact volumes are declining or 2009 provides a very soft market the whole year and there’s a lot of contraction it does take a little bit of time for our model to adjust in terms of the staffing levels and the headcount. It may not be quite as efficient scaling downward as it is scaling upward when we’re adding people and providing variable incentives. You put that all together and we can model it a thousand different ways and we just don’t know what 2009 is going to look like but it’s hard for us to imagine that we’re going to gain the same sort of leverage that maybe we have for the last couple of years. Thomas Wadewitz – J.P. Morgan: So we should probably think about operating margin under a bit of pressure then if we look at it that way, at least near term?

Depending upon where volume levels are at, if it’s flat, yes.

Our next question comes from Chris Ceraso - Credit Suisse.

Just to clarify, when you talk about, and you mentioned this a couple of times, the lower cost of capacity, is that mainly fuel?

Yes. Fuel is definitely more a cents per mile drop than the underlying line haul rate but underlying rates, depending on when you’re comparing to, compared to last year underlying rates for us were roughly flat.

The difference then is the fuel? The comment about the sustained slow freight environment, was that directed at Q4 or is that more toward the outlook for the first quarter and for 2009?

Really for both. The fact that 2008 was a softening market that throughout the year demand weakened and our volume growth slowed so that the longer end of 2009 that that persists will start to lap comparisons on variable compensation and margin expansion and all the rest of that, that will make it more challenging.

Is it fair to say that in the fourth quarter given the sharp drop in volumes that we hadn’t seen up to the point in 2008, does that create some extra opportunities for you and if we go sideways at a low level, that’s where you get into more trouble?

I think that’s correct, yes.

Is there anything fundamentally about your business or secular whys in the industry that has changed that would jeopardize the longer term growth prospects of the 15% that you’re targeting?

We really don’t think so. We’ve talked about that a lot and actually it’s not a great time to be bold, but in some ways I can talk myself in that maybe there’s even more confidence in the longer term horizon when you think about carrier fragmentation and instability in supply chains and our opportunity to be a good foundation and a good partner. There is even today a lot of opportunity in the marketplace and a lot of the things that we feel really good about but when the underlying pie that you’re trying to take share from is contracting at double digits, it just gets really hard to post good numbers. We feel as good as we’ve ever felt about the long term but in the short term it’s a pretty weak environment out there.

Our next question comes from Matt Troy – Citigroup.

I was wondering, I think that the consensus view is that an economic recovery isn’t in the offing until 2010 at the earliest. I understand it’s difficult to think about the trajectory of volumes through the year. What I did want to do is try and get a sense of the reading of the tea leaves and what you’re hearing from customers about freight demand in the first quarter? Specifically if I just look in the context of volumes being depressed across all modes, over the last eight weeks you’ve got plant shutdowns that you talked about in December and January, you’ve got the early arrival of the Chinese New Year coming up in a few weeks, all of which points to what I would argue is an artificially depressed level of shipment activity. Are you hearing anything from your customers about a sharp pickup or expectations or need for capacity beginning in mid-February in hopes that some of these folks just playing catch up albeit it could be just a near term phenomena? Are you having those discussions or hearing that yet?

No, we have not heard that. I think there has been discussion, again it would be very anecdotal that I’ve been a part of where perhaps some of that year end plant shutdown last December early January some discussion around maybe some temporary softness just due to the abrupt corrections in the business models from some of the manufacturers and we do know that when we look across our customer base that the manufacturing slice of it was down the most in terms of volume. I think it’s a plausible theory that some of this is a little bit softer now than it might be but I haven’t heard anybody talk about short term sharp corrections in demand.

I don’t think sharp is a word anyone is using on the upside these days. That wasn’t my inclination. I’m just trying to level set expectations. When you hear about activity picking up in February. Secondarily looking at the organic numbers on the trucking side certainly reflective of the broader market but I think when the dust settles and we can see industry statistics in whole on the trucking side, I would imagine you guys are taking some share, difficult to provide metrics that show that, but I was wondering whether it is your anecdotal conversations with customers on the bigger side or contracts you may be signing. What’s your sense on the upslope of this thing that you are going to be a bigger provider, a bigger partner to your existing customers than today, that you are in fact taking share in this downturn? Any evidence there?

We know that for many, many years we’ve been taking share by most of the measurements that we have and we know that it’s a core competency of ours. Nothing really changed in the fourth quarter in terms of what we’re doing or how we’re executing so we’d like to believe that we continue to take share but when you’re a growth company with high growth aspirations and your volumes decline, it’s hard to feel good about bragging about taking share. Hopefully that continued to happen. I would say when we think about the longer term prospects of our success and our business model, we know that one of the things that we do for small carriers or shippers of all sizes is bring some stability and continuity and automation and innovation to the relationship that maybe they don’t get elsewhere in the marketplace. I guess it’s our hope and our belief that the core long term value providers that we think we’ve leveraged for the last couple of decades seem to be as pertinent as ever out there and should be and hopefully will be when demand returns as well too. Hopefully we’re not being naïve about it but despite the fact that it’s a really tough environment we have as much confidence as ever that what we’re all about is going to stay relevant and we’ll be in a great spot when that demand comes back.

I’m sure that the share numbers will bear that out when we see your performance versus industry, but I guess we can wait and see. The last question is relative to acquisitions, counter intuitively I know that away from the trucking side and even on the trucking side internationally, acquisitions are something you guys have explored in the past to grow those businesses. In this environment are you seeing any more attractive opportunities? Obviously culture has been a barrier you want to scrub the personality and culture of who you’re buying, but certainly I would imagine given valuations being more attractive and you’re in a very nice cash position you’re in a better position to buy properties. Is the pipeline any better these days?

You’re right that the market expectations on prices have definitely fallen from the peaks, but at the same time there are a lot of companies that, the better companies, the smaller ones that we’re looking at are still thinking in those peak prices and a lot of transactions aren’t happening right now. A lot of what you see are people who are desperate and if you’re in our business model and you’re a well run company even in a tough time you shouldn’t have that desperation. There hasn’t been really an increase of high quality opportunities but we are definitely out in the marketplace looking both reacting to what we see that’s available for sale as well as continuing to be proactive.

Our next question comes from John Larkin – Stifel Nicolaus. John Larkin – Stifel Nicolaus.: I have the impression that there are quite a few very sizable LTL bid packages out on the street currently and I listened with great interest as you mentioned that that’s one of your thrusts to diversify your services. Are you participating in those bids and any early indications as to how those might play out in your favor?

I do know that our LTL team is very active and working on a lot of new business. I’m not sure if it’s the same ones we’d be referencing or not, but LTL is a growth opportunity for us and we do think that we can be of value in any size or any type of a relationship. A lot of the very largest LTL shippers will most often want to have a direct relationship with some of the largest providers that they match up with and we can provide some process facilitation and automation to that relationship and help out with some of the rest of it. In the very largest opportunities we probably wouldn’t be well positioned to handle it all like we might be with a medium or small account, but regardless of the size I hope that we’re involved in all of them and if you want to forward us the names, I’ll make sure that we are. John Larkin – Stifel Nicolaus.: On this whole theme of integration and diversification which I think is a great theme going forward for the company. Does that imply as you get deeper into it that you need to change the mix of personnel that you’re bringing into the company to find people that are a little more conversant in multi-modal terms and to perhaps do some fairly major work to your systems to enable these folks to really provide that multi-modal almost transportation optimization view for your customers?

Yes. The only thing I might describe a little bit differently, John, is I feel like that transition’s been underway for quite some time. Our Information Technology team has grown from less than 100 a decade ago to more than 300 today. We’ve got a bunch of logistic support teams and clearly, like in the global forwarding business, the type of people we’re adding around the world are of different calibers and different cultures so we definitely need to continue that and perhaps accelerate it in some areas around analytical support for some of the fee based management type services. Yes, is the overall question. It’s a transition that’s been occurring, that we need to carry forward with and probably accelerate in some areas. John Larkin – Stifel Nicolaus: The data center capital investment that Chad detailed during his comments, how much of that is sort of geared towards improving the overall versatility of the systems along these general lines of providing more multimodal integrated services to your customers?

Really our current data center is nearing capacity is part of the issue so it’s definitely enabling more services just because we’ll have more room for more servers and it will be definitely a little bit more redundant than our current one and more stable than our current one and should never, ever, ever go down is the hope. But, it really is more of capacity play than it is being able to change the types of systems we can build. The software development and the functionality and the support tools that would drive at the transition that we’re discussing or talking about, we’ve got more than 100 developers that are working on those sorts of tools that certainly the infrastructure of the new data center will help us deploy those and run them more efficiently but the real intellectual capital of some of the support tools and decision tools that we’re working on are really the resource being put towards that is really more the team of people that are developing the software. John Larkin – Stifel Nicolaus: Those people are employees as opposed to consultants?

Yes. John Larkin – Stifel Nicolaus: So these systems very well could be proprietary and difficult for other people to replicate?

Yes, all of our core North American operating systems are proprietary. Our European truck system is the same system and it is proprietary and we’re working on an international forwarding system that will be worldwide and proprietary.

Our next question comes from Jon Langenfeld – Robert W. Baird & Co., Inc. Jon Langenfeld – Robert W. Baird & Co., Inc.: Chad, is there any way to kind of just roughly swag the working capital and say how much of it came from fuel in the quarter and how much of it came from lower business levels?

The receivables are down about 20%, or a little bit more than 20% from the end of the third quarter. Most of what’s left in the receivable balance is from December transactions because we average about 40 days collection. We already mentioned volumes and the biggest source of revenue was down a little over 10% in December so that’s part of it. Then, the rates of our truck load for the total quarter were also down about 10% or a little bit more as well driven primarily by fuel if you look at the quarter sequentially. If you’re looking at it from third quarter to fourth quarter how did we cut it 20%, it was roughly half volume and half price and a little bit of improved collections. Jon Langenfeld – Robert W. Baird & Co., Inc.: How should we think about the amortization or depreciation of that data center coming on line? How material will that be and when will that start to hit?

It will start to hit in the second half of the year. We plan on implementing it sometime in the third quarter, is when we planned to bring the data center up. I haven’t seen an asset life study on the total thing but if I had to guess it’s probably on a weighted average basis somewhere around a seven to eight year asset. Jon Langenfeld – Robert W. Baird & Co., Inc.: And there’s $8 million in ’08 and another $12 million, so basically $20 million you’re putting in to that.

A little bit less than $20 million. Jon Langenfeld – Robert W. Baird & Co., Inc.: Then just on the intermodal side are there any particular carriers that you’re getting more or less lift on given the success you’ve had there?

I think that it’s generally sort of across the board. We do less with the BNSF directly because they like you to have your own equipment but the others the CSX, Norfolk Southern, Union Pacific and Pacer, we’ve had good growth will all four of them this year. Jon Langenfeld – Robert W. Baird & Co., Inc.: So none that particularly stands out among those?

No. There’s obviously some transition in the west with the Pacer UP thing and actually I may have misspoke that, I’m not sure if our Pacer activity is up for the year or not but it’s still a very significant provider for us. But, as the transition and offerings goes on we’ll continue to try to grow on both of those horizons. But, our growth is coming from improved relationships we believe, on the customer and carrier side all across the board. Jon Langenfeld – Robert W. Baird & Co., Inc.: The last question just on the bid activity, you touched on this a couple of times but, when you talk about trying to focus more or get your fair share of the bid activity that is out there as kind of a core carrier on the contractual side. What exactly does that mean or what do you emphasize more these days in this environment than maybe what you were doing 12 or 24 months ago?

It’s probably a lot of the same things with different points of emphasis but when we’re looking for a more dedicated position in the route guide it’s typically a combination of price and service. What we like to emphasize is even though we’re an non-asset third party model that our service metrics of load acceptance and on time pickup and delivery we believe can be as good or better than anybody else’s so if we’re price competitive we just want to make sure that in any bid situation that we’re working on that people understand our capabilities of commitment and our automation and the feedback and reporting that they’ll get from us. Often times the roll that we play for a shipper may be lower in the route guide or a back up brokerage type provider and in this type of environment we will probably put a little more emphasis on the fact that we can certainly play the role of a dedicated provider and be anywhere in their route guide and make sure that hopefully they’re considering us as a viable vendor for any role. Jon Langenfeld – Robert W. Baird & Co., Inc.: How would you compare that strategy to maybe 2001, 2002? Was there a similar I don’t want to call it a shift but maybe a similar emphasis being put on that type of strategy?

I think so. I think it’s probably fairly intuitive that any time the market softens and that shippers tend to have as much freight as they planned or less, likely a higher percentage of that will go in accordance with the bids and the route guides that were set up at the beginning of the year so you need to be a little more aggressive about wanting to participate on that. When demand is very high and volumes are much greater than anybody projected often times the way to be of most value to somebody is to be that person who is helping them out with all the unplanned freight of the freight that falls through the route guide that becomes more spot market or challenging. So, I think it’s a very fluid transition that would be natural for us but in a softer market we’re going to want to make sure that we’re participating in the freight the best way we can. Jon Langenfeld – Robert W. Baird & Co., Inc.: Chad, with the -1% net revenue you talked about in January, is that just North American net truck revenue?

Yes, all of those monthly numbers both for the fourth quarter as well as January that we referenced, all of those were North American truck loads only. Jon Langenfeld – Robert W. Baird & Co., Inc.: The net revenue included?

Yes.

Our next question comes from Edward Wolfe – Wolfe Research LLC. Edward Wolfe – Wolfe Research LLC: Can you talk a little bit more about truckload pricing? You said it was flat for the quarter, where did it end in December and January net of fuel as you see it?

I don’t have January rates in front of me at all. December was, excluding fuel, maybe $0.01 lower than the average for the quarter so pretty comparable. Edward Wolfe – Wolfe Research LLC: Is it your sense directionally that it’s holding up pretty flat in the market place or does it feel like it’s softening to you?

My sense Ed and maybe this is more speculation, like Chad said we don’t have the facts in front of us but the fuel decline was so significant during the fourth quarter that overall pricing was coming down quite a bit but there’s no doubt that if the market is as soft as it is that expectations and bids from the beginning of the year will have to start driving the rates down more aggressively. Edward Wolfe – Wolfe Research LLC: Just switching gears, on the headcount, the headcount was up I think 8.5% year-over-year and I realize I think it’s 107 or so from the acquisition but even taking that acquisition headcount down we’re up 7% or so. What’s the goal with the headcount as we go out through next year and how quickly can you take it down if you want to adjust to volume say?

In normal times what we’ve discussed over a longer period of time with our business model is that it’s common for us to experience double digit turn over through voluntarily turn over and performance based attrition. Now maybe in a very soft market it won’t be that high but our normal approach would be to manage the business as we have and if thing stayed very soft and we didn’t hire during the year which is the mode we’ve been in for a couple of months now that you could correct to that magnitude on kind of the normal course of running the business without any more significant adjustments. So, I think our challenge is just to keep executing, stay on top of it and react to the market demand and make sure that that approach is going to be adequate to keep us adjusting. Edward Wolfe – Wolfe Research LLC: So am I hearing you right John, you’re talking about attrition not cuts at this point, just letting people attrish and not hiring is the way to think about things?

That would be the current approach. Whether that remains adequate or not will probably depend on how the market goes.

Attrition would be both voluntary terms plus performance based terms. Edward Wolfe – Wolfe Research LLC: What would you expect assuming there is no change in the economy the first half of the year, how much attrition could you see or would you expect to see?

Like I’ve said we’ve been at for many years a double digit rate so maybe a mid single digit turn over rate by the middle of the year. That’s again a very broad generalization. We’ve got several different service offerings now where with global forwarding and other parts of the world where the relationship could be a lot different, those are very high level statements. It could [inaudible] very differently by business line. Edward Wolfe – Wolfe Research LLC: You guys have a special kind of situation with all the cash that you guys have given how tough it is to find cash in this market place. You made the comment that finding acquisition at the right valuations are tough. Two questions for you, one is there an opportunity to use that cash in other ways? Do you plan to continue to buy back your stock for instance? If you bought it at $50 are you buying it at $43 or wherever the stock is? Then secondly, if there’s a very large opportunity out there for maybe a very quality larger company that’s depressed in this market, would you use a combination of stock and equity?

We’ve always been predisposed to any size transaction if we thought it was the right cultural fit and the right long term opportunity. As we’ve said, a lot of times we run fairly lean and we’re not in to fix it up projects so if we felt like it was a good company that just had an attractive price, we would not be afraid to use our balance sheet and to use our cash for that sort of growth opportunity. We’re obviously doing share repurchases and plan to continue so. We have ongoing discussions with our board about what’s the right level of that. But, we don’t want to accumulate a lot of excess capital but we expect to be very profitable in 2009 and continue to use our balance sheet to quick pay carriers and help grow the business, be ready to supply that working capital right away when the market turns and take advantage of it hopefully better than anybody else and look at acquisitions and share repurchases in the interim as ways to keep the capital level.

We’ve mentioned this in previous years as well, our cash balance tends to get the highest at the end of the year and then early in the year we have some significant payments like the $40 million dividend that’s already been paid. Most of the accrued comp on our balance sheet will be paid out during January which is another $80 to $90 million that will also be paid out. So, it does look really high but it will fall during January. Edward Wolfe – Wolfe Research LLC: If I look at the restrictive stock grant you had talked about in the past 100 to 200 basis point kind of expense headwind. Given where the stock is and how things are first of all, do you know how large the grant is going to be at this point? And then, is there any updated kind of guidance on what you think the expense drag might be from that?

The grant was done in November and if I remember right the total amount was around $100 million or slightly more. As far as the expense of it, it depends on the growth. So, it’s the average of operating income growth and earnings per share growth, take the average of that and add 5%. Edward Wolfe – Wolfe Research LLC: So if we assume that operating income is going to be flat and earnings per share flat for the year.

Then there would be an incremental expense, there’d be about $5 million of expense from the current grant and then probably about $5 million of expense from the previous grants compared to $17 million I think it was for the total year of 2008. So, in a flattish scenario even with the incremental grants, the expense could decline. Edward Wolfe – Wolfe Research LLC: In fourth quarter, what was the amount of incentive comp in the expense line versus a year ago?

There’s many different incentive formulas. Are you talking about equity? Edward Wolfe – Wolfe Research LLC: No, I’m talking about expense in the personnel expenses line.

I don’t have it totaled up here in front of me. I can’t give it to you right now Ed.

We have a lot of intertwined salary, bonus, commission, growth pool type programs that sometimes there’s draws against them and that’s not a way that we look at it in terms of isolating the total variable part. We do for the equity piece of it and we could make some assumptions and back in to something but we probably shouldn’t do that on the fly here. We don’t really grab the number that way. Edward Wolfe – Wolfe Research LLC: For the equity piece what does it look like then?

You can see that right on the cash flow statement. So, stock-based compensation in total for 2008, I mentioned $17 million in restricted stock. That’s mainly the performance based, there’s some other restrictive stock grants as well as there is a little bit of reload expense so people who got reloads on their old options. So it was $21 million almost in 2008 compared to $38 million in 2007. Edward Wolfe – Wolfe Research LLC: Then finally, intermodal net revenue up 28% or gross profit up 28%, is that sustainable and what’s going on that’s driving that if you would?

Probably not sustainable in today’s market conditions at that level of growth. As Chad mentioned, that’s a combination of volume growth and margin expansion. As the year wears on if the market stays soft like this I don’t know if the intermodal price advantage to truck wills stay as wide as it is to give us those mode conversion opportunities. However, as we talked about earlier, we’ve put a lot of effort in the last few years to improving our operational execution, our carrier relationships and we do feel like we have very good momentum in terms of offering that service and selling it in the market place. So, we do feel good about outperforming the market, whatever the market is but I think there was a combination of our momentum and good market conditions versus truck that allowed us to grow at that rate. Edward Wolfe – Wolfe Research LLC: Is it a coincidence that when intermodal volumes were being reported by the railroads and other IMCs is very high you guys seem to be under growing the market and now when things have turned you seem to be taking share? Or, is it just things that you implemented that are now bearing fruit? How do I think about that?

I do think that our participation in the intermodal market space is a little bit unique in terms of pursuing customers that have multimodal freight or are doing both types of transportation. So, it may be that our volumes are going to fluctuate or correlate a little bit differently based on the type of customer that we have. But, there’s also no question that if you look back over the last five or six years that we’ve gotten our performance a little bit better in terms of we made some changes around centralizing the team a few years ago and improving the operating system and really revamping carrier relationships and executing at a different way. I think some of this, it’s a combination of it that maybe our participation and freight exposure is a little bit unique but also there’s a little bit longer trend of us believing that we’re selling and executing better the last couple of years.

At this time I’d like to turn the call back over to Angie Freeman.

Unfortunately we’re out of time so that will have to be our last question. We’re sorry we could not get to all the questions this afternoon. Thank you for participating in our fourth quarter 2008 conference call. This call will be available for replay in the investor relations section of the C. H. Robinson website at www.CHRobinson.com. It will also be available by dialing 800-405-2236 and then entering the pass code 11124369#. The replay will be available at approximately 7pm Eastern Time today. If you have additional questions please call me, Angie Freeman at 952-937-7847. Thank you.