Welcome to the C. H. Robinson first quarter 2009 conference call. At this time all participants are in a listen only mode. Following today’s presentation instructions will be given for the question and answer session. (Operator Instructions) As a reminder, this conference is being recorded Tuesday, April 21, 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 CFO. John and Chad will provide some prepared comments on the highlights of our first quarter 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 risk and uncertainties. Our SEC filings contain additional information about factors that could cause actual results to differ from management’s expectations. With that, we’ll turn it over to John.

Thanks to everyone for taking the time to listen to our first quarter conference call. About an hour ago we issued our press release sharing our first quarter results for 2009. I’d like to start by highlighting just a few of the key financial results on the release. For the first quarter ended March 31, 2009 our gross revenues declined 15% to $1.68 billion. Our net revenues were flat at $338 million. Our income from operations increased 1% to $137 million. Net income decreased 1% to $85 million and fully diluted EPS was flat at $0.50 per share. In addition to these overall financial results our press release gives more detailed growth percentages by the various service offerings. As I stated earlier our consolidated gross revenues were down 15%. The two key or primary parts of that, our transportation gross revenues were down 20% and our sourcing revenues were up by 8.5%. The transportation gross revenue declines were driven by both volume and price declines. Most of the price decline was driven by the decrease in the price of fuel. The volume decreases were pretty much across most of our customers driven by the recession. From an industry perspective volume declines in our food and beverage customers were more modest. Volume declines in our paper and printing customers were greater than the overall declines. While overall truck load price averages excluding fuel were down only modestly compared to first quarter last year. Price declines did increase throughout the first quarter as the market adjusted to weakened demand. Our sourcing division results for the quarter were one of the positive highlights. Our sourcing business was able to grow revenues in the first quarter. The revenue growth was driven by volume primarily with current customers. Our services and strategies were similar to…

(Operator Instructions) Your first question comes from Thomas Wadewitz – J. P. Morgan. Thomas Wadewitz – J. P. Morgan: I wanted to ask you first on your thoughts about the transportation gross margin which was a very impressive number, quite a bit above what we thought it might be, the 22.6 number. Do you think as you look at second quarter, is that a number which can actually go up? I mean, you commented on pricing that you’re paying the truck load carriers, your suppliers going down through the quarter so it seems like a very high number. But, is that likely to go up when you look at second quarter or do you think it is more likely to come down? Chad M. Lindbloom It’s really going to depend on what happens in the marketplace as a whole. Generally the first quarter when you look at history is the highest margin percentage of a quarter. So, they’re having some unusual times recently so it’s very difficult to predict and it’s really going to depend on the market supply and demand dynamics. Thomas Wadewitz – J. P. Morgan: I guess you commented on the truck load pricing dynamic, is it a big deterioration in pricing where you would expect instead of being down 1% like you were in first quarter to be down significantly more in terms of what you pay to your truck load suppliers in the second quarter?

The customer pricing trend is downward and we would expect it to be a greater decline. The challenging thing to forecast is how that would relate to the cost of hire and exactly at what pace the two of them will work together. So, there’s a volume relationship, like I tried to describe how volume and price will kind of correlate. When you look at it fuel prices obviously are probably the greatest driver of that percentage and then you’ve got mix issues in there as well too for all the various categories of truck load services and less than truck load. There’s a lot of variables that fall in to the mix and there’s a lot of market forces that impact it that are all moving around as fast as ever. So, that was really the essence of the message in the prepared comment is no matter how much you study it, it is just getting harder and harder to forecast it. Thomas Wadewitz – J. P. Morgan: When you talk about the customer side historically I think you say broad brush 50% contract and 50% is spot. In first half of the year does most of that contract business roll over or is that spread throughout the year?

Most customers do their bids whenever they feel like doing them rather than on a set schedule. Some will have predetermined calendar schedules. There was a very, very high level of customer bid activity in the first quarter and I think that was talked about throughout the industry so our assessment of it is that when you see the market changing as aggressively as it has in the past three to six months it’s no secret that the market is soft and prices are likely to fall therefore you see a lot of shippers come in to the marketplace with bids right now. Thomas Wadewitz – J. P. Morgan: One last question and I’ll pass it on, do you have any sense how much contract pricing, if you look at that 50% of your book that’s contract, how much magnitude is that coming down? Is the pricing coming down 5% or is it potentially significantly more than that? Chad M. Lindbloom More mid to high single digits rather than the 1% average for the first quarter. I think that expectations for savings vary. You hear stories of periodic double digit savings and often times it’s more modest but I would say kind of mid to high single digits decrease in prices would be a more common bench mark for where the quarter ended up versus the average. Thomas Wadewitz – J. P. Morgan: That’s what you’re receiving from customers as opposed to what you’re paying to the carriers or that’s kind of representative of both? Chad M. Lindbloom I was talking about customer rates. The carrier rates can move faster and are much more dynamic and will generally adjust quicker. It’s really the carriers that initiate the changes.

Your next question comes from Justin B. Yagerman – Wachovia Securities. Justin B. Yagerman – Wachovia Securities: On the expense side you guys did a really good job controlling costs, I was curious to dig in on the SG&A down sequentially and flat year-over-year. When I look at that what were the puts and takes that went in to that number that helped you keep that in line on a year-over-year basis? Chad M. Lindbloom As I mentioned in the prepared comments, our bad debt was down about $500,000 compared to the fourth quarter when you look sequentially. We also had lower freight claim expense during the quarter and a lot of discretionary type spending like travel and training and travel and entertainment, there were significant reductions in that. I should say that the training was because we’re not adding as many people as we have in the past. So, when we look at the detail of SG&A schedule there are reductions in many different categories. Justin B. Yagerman – Wachovia Securities: On the restricted stock side, that goes in to personnel expense, did you guys accrue for restricted stock grants in the quarter?

Yes we did but it was a much smaller number based upon the vesting formula that we’ve talked about before. Chad M. Lindbloom Our vesting formulas are basically the average of operating income, growth and earnings per share growth plus 5%. So, our vesting during the quarter was about 5% or 5.5%. Justin B. Yagerman – Wachovia Securities: So that’s an expectation of flat earnings on a year-over-year basis for the year or is that just applicable for the quarter? Chad M. Lindbloom It’s applicable for the quarter. When we look at the growth rate year-to-date of any quarter and however many quarters we’re in to the year we take that many quarters worth of expense of what it would be at that vesting percentage because you’re right vesting only happens once a year at the end of the year. Justin B. Yagerman – Wachovia Securities: So that could end up having to be trued up one way or the other as you go through the year? Chad M. Lindbloom We’ve always trued it up every single quarter since we’ve had the program, yes. Justin B. Yagerman – Wachovia Securities: Is there any way to break out between truckload LTL in terms of the gross revenue decline in the quarter when we look at the transportation sector? Chad M. Lindbloom More of it was due to truck load, truck load gross revenues in total were down close to 20% which was basically the 10% or 11% rate increase we discussed as well as the 10% roughly decrease in volumes. Justin B. Yagerman – Wachovia Securities: So 9% of that, nine percentage points of that would be fuel if it’s only down 1% net of fuel, is that the right way to think about that.

I think the total rate is closer to 10% being fuel and 1% being underlying rates. Just as a reminder all of our fuel calculations are estimates as a lot of our pricing on both sides are bundle rates so we’re making a lot of assumptions around typical fuel costs and surcharges and stuff and these are all our best estimates on the pricing and rate break outs. Justin B. Yagerman – Wachovia Securities: When I think about D&A being down in light of adding branches how does that typically impact the D&A line? Are those leased or is there much going on in there that would be affecting us? Chad M. Lindbloom Almost every building that we have with the exception of the corporate building and the one in Chicago and our new data center is leased so the bulk of that is the true building costs are depreciation and amortization but the desks and phones and computers that go under them are and the furniture. But, when we open new ones it is relatively small number because when we open a new office we do generally two to three people so when we compare it to the total it really doesn’t get noticed. Justin B. Yagerman – Wachovia Securities: When I think about provisions for doubtful accounts being down sequentially in this environment are you guys seeing something different from your customer base? In general I would have expected things to be flat to up in the kind of economy that we’re hearing about. What gets you more positive that your accruing differently for that? Chad M. Lindbloom Our aging actually improved for the quarter. The total amount outstanding went down and we had less customer specific bankruptcies during the quarter.

So, we are accruing for it under the same formula it’s just that the experience was more positive.

Your next question comes from Matt Troy – Citigroup. Matt Troy – Citigroup: A couple of questions, first on the headcount reduction sequentially down by about 500, I just want to be sure that I understood your numbers. You said there’s about $2.5 to $3 million of severance related to that reduction in the first quarter so if I think about modeling next quarter and subsequent quarters that will not repeat?

That’s correct. Matt Troy – Citigroup: The second question, if you could just help me in terms of how the quarter, and I know it’s early but April started to look, sequentially you talked about volume declines in the truck load and LPL business but you know all months are not created equal. Any sense of progression January to Feb, Feb to March, March to early April, you obviously had the Chinese New Year comp and Easter skewing those but any sequential sense you could give us?

I’ll share it and Chad can add on to it, in general when we’ve looked backwards and forwards it sort of feels like kind of late November early December there was a pretty sudden and pretty significant drop in the overall freight levels and its really kind of stayed there. There’s been a little bit of positive, a little bit of negative, a little bit of whatever but for the most part we feel that from mid November early December on there’s just been a double digit decline that we’ve been fighting to kind of take share and grow with that so we haven’t really seen a lot of trends within the last three or four months. Chad M. Lindbloom The volume growth was on a per business day basis during the first quarter when you look at North American truck load was within one percentage point of each month. It went 10, 9, 9.5.

We look at it a lot of different ways with business days, you know you’ve got Easter in a different month and you’ve got weekends and month ends and when you factor that all in it really doesn’t tell us anything. It’s just been declines straight across. Matt Troy – Citigroup: On that note, I think I asked this last quarter or maybe the quarter before that there logically would have been an opportunity to see some pickup due to just simple restocking post Chinese New Year as those comps normalize. We certainly haven’t heard from any carrier that saw that. Is there a logical sign post or thought process in the next couple of months where you would expect to see or you’re hearing from your customers some level of restocking whether it’s just broadly or just by industry vertical. Are you hearing anything out there that will sequentially help that rate of decline?

Not really. We have different levels of business reviews and interactions with various customers around how much we know about their business and total volumes but we really don’t have any insight or any signals that would suggest there’s going to be any moments that are more important or less important than the rest. Matt Troy – Citigroup: Then no indication that people are anticipating some kind of restocking lift imminently?

No. Matt Troy – Citigroup: You talked about how if fuel prices remained at comparable levels that they are today what kind of impact that would have on gross revenues. Can you just help us comparatively year-over-year how that might play out from a margin perspective given the lag sometimes in the fuel surcharge recovery. How if I just modeled flat fuel prices it plays out on a net margin through the balance of the year. Chad M. Lindbloom To tell you how it would play out on a net margin would be pretty difficult for us to predict because we don’t know how our customer prices are going to react and how the underlying carrier prices are going to react. But, as John did mention there would be double digit gross revenue declines on a per transaction comparable transaction just related to fuel. So, if you view fuel as a pure pass through or at least a dollar per dollar pass through obviously that will have a significant impact on margins in and of itself because both sides will go down. If the dollar stays the same of profit it’s obviously a big margin impact.

Your next question comes from Ed Wolfe – Wolfe Research. Ed Wolfe – Wolfe Research: You said before that rates for you guys were down 1%, on the truckload side I think that was for first quarter but ended was it March or April down mid to single digits and was it truck loads you were talking about specifically? Chad M. Lindbloom March and yes, just truck load. Ed Wolfe – Wolfe Research: Was the sense that the reason that it dropped so quickly was related to the bids and the number of bids that were in the process?

Yes and the component of transactional pricing where I think there was a growing awareness of excess capacity and more transactional pricing occurring at prices that were declining. Ed Wolfe – Wolfe Research: But is it fair to say that you’ve been in a lot of these bids?

Yes. Ed Wolfe – Wolfe Research: An April, is the implication that that is going to lag for a while or that its similar to March?

I don’t think we know what the implications for April are yet. Even when there’s a lot of bid activity going on you really don’t know exactly what the results are going to be or if they loads are going to be tendered in accordance with the bid. A lot of shippers can do bids but then tender a lot of the freight transactionally so it gets challenging to predict it. But, like I said we’ve studied April a bunch of different ways and it doesn’t really tell us anything yet but we do know that throughout the first quarter pricing was generally coming down. Ed Wolfe – Wolfe Research: I mean if I look at the transportation yield at 22.6, how did that look in March relative to the average? Chad M. Lindbloom It’s hardly noticeably higher when you look at truck load gross margin percentages.

Pretty constant throughout the quarter. Ed Wolfe – Wolfe Research: On the incentive comp side, can you give numbers of what the incentive comp was in 1Q ’09 versus 1Q ’08? Chad M. Lindbloom What makes it hard is that each of the individual offices has unique growth pools and different incentives based upon different growth rates. So there’s mix issues within it from an incentive comp standpoint so the restricted stock numbers are on the cash flow but the even greater component of variable compensation is the bonus programs that can vary a lot based upon the mix. Ed Wolfe – Wolfe Research: What was the total number of that program for the full year ’08 if you have it?

For which program? Ed Wolfe – Wolfe Research: For the total bonus program.

There are so many different programs and so many different ways that they vary that we don’t disclose it because we’re afraid it would confuse people more than help people. When you look at a static pool of employees somewhere between 35% and 40% of the pay or related expenses would vary based on one measure of profitability or another. Ed Wolfe – Wolfe Research: I understand but directionally first quarter over first quarter, how much are we down? I mean directionally is it of the magnitude of 10%, 50%?

It’s the offset of the changes in restricted stock and severance charges so I don’t know what it results to from an expense standpoint but you’ve got increases in severance and staffing like we talked about and then you’ve got reductions in the variable cost pieces. Again, depending upon what programs you’re looking at and how much of the total you were adding up the percentages would vary. Ed Wolfe – Wolfe Research: On the headcount side, is 500 the right number? 5% or 6% when volumes are down 10% or 11%, is it possible we could see more and maybe more severance payments?

Here’s the way I think about that Ed, we started like I said earlier we started the year 8% more staffing an say around a 10% volume decline which we had 10% less to do in April and 8% more people, that’s probably not the right business model. So, by the end of the quarter we were flat with a year ago and let’s say volume declines are still at a 10% lower level. We don’t know what the rest of the year is going to bring but I know that last year we went from 7,500 to 8,000 people throughout the last three quarters of 2008 and right now we’re really not hiring very many people and we’re managing things more aggressively so if our headcount stays flat our productivity metrics will come much more in line as the rest of the year wears on. So, we hope that we’re pretty close to where we want to be from a staffing standpoint but who knows what the rest of the year is going to bring. Ed Wolfe – Wolfe Research: But it’s not out of the question that if things feel, you answered someone else’s question kind of all the severance is in the first quarter, that’s based on what you’ve done so far. Further action if you needed it is not ruled out at this point?

That’s correct. Ed Wolfe – Wolfe Research: John, in your overall first discussion you talked about it feels like a normal cycle other than it’s deeper and happening faster. How do you think about what that might mean as you go through the year and what does that mean that it’s all happening faster?

If you look at the last 30 years since deregulation when we’ve been riding through the cycles, prices have fluctuated, margins have fluctuated, volumes have fluctuated but like we’ve talked about in 2005, 2006 we never saw double digit rate increases until that period of time. We never saw the fuel do before until 2008 those types of increases. We had never seen the industry drop double digits in volumes in a one month time near the end of last year. So, you’ve got this sudden significant drop in industry demand and our demand and when demand drops, prices drops so that’s not uncommon but it is just such a big number and a visible number that I think we and every shipper are trying to react different to that where you want to move quicker to take advantage of the changing market conditions which is probably the right thing to do but then you’ve got to think about is it sustainable, will it come back, what’s it really going to do. So, the fact that people would be rebidding freight and trying to adjust to new market conditions is not at all a new phenomena but the magnitude of how much it’s dropped and therefore how quickly people are reacting and the strategies that they’re reacting with, this is all kind of new territory given this new level of volatility. Ed Wolfe – Wolfe Research: It’s been a pretty amazing run and you guys always seem to somehow make it work. What are you seeing from capacity generally? Have you seen any major changes from a quarter ago in terms of people either leaving or reentering the marketplace?

Not really. Obviously, there’s been some failures but we continue to sign up new carriers at almost 1,000 a month. You don’t know how much of that is recycling of other capacity or true new capacity but it doesn’t feel quite like the churn of capacity is quite reflective yet of the drop in demand. Ed Wolfe – Wolfe Research: That 1,000 per month, what was that say in July or August of last year?

Pretty similar. Again, I think those new carrier numbers are probably not the greatest metric for us to rely on because oftentimes it’s one, two, three, five trucks. It’s more like the seeds of relationships that we hope to build longer term with them so we continue to identify new companies to do business with and to try and grow from but, a very, very small percentage of our total freight will get moved in any given year by the carriers that we initiate relationships with that year. Like, 1% or something so we look at it as a metric that is indicative of our network expanding and kind of staying active with growing it. But, I don’t know that it is a real helpful metric in the short term about what’s happening with the universe of capacity. Ed Wolfe – Wolfe Research: One last question, can you give an update and some flavor on the legal case where the underlying carrier had a severe accident and there’s a $24 million claim? Where are you in that case and have you reserved for it? And, how do you think about the impact that could have going forward? Chad M. Lindbloom Sure, I’ll give a little bit of background on the case. In March, a jury in Illinois entered a verdict against us, a carrier and the carrier’s driver in the amount of $23.75 million. The jury concluded that the driver was acting as our agent at the time of the accident which occurred in April, 2004 even though the carrier and the driver admitted that the driver was working for the carrier and that the load was being moved by them acting as an independent contractor for us under our carrier contract. The verdict claims that we were responsible for…

Your next question comes from Chris Ceraso – Credit Suisse. Chris Ceraso – Credit Suisse: The pricing you mentioned on the truck load side finished down a lot steeper than it averaged for the quarter. Can you give us some similar measures on the LTL side on an ex fuel basis maybe month-by-month? Chad M. Lindbloom No, I don’t think we have that data in front of us. Chris Ceraso – Credit Suisse: Do you have maybe an aggregate for the quarter on the LTL side? Chad M. Lindbloom Truck load is very easy to convert on a per mile basis by mode where as LTL you get in to the classes and rates and it’s very difficult for us to know that the change in gross revenues is equal to it’s reduction in rate. So, it could be that we’re moving freight further or heavier freight when we look at it on a per transaction basis. Chris Ceraso – Credit Suisse: So, you’re measuring price or rate by mile on the truck load side, was there any notable decline in the length of haul that may have made that price look perhaps a little bit better than it was? Chad M. Lindbloom It went down slightly, our average length of haul, just a few miles though I think. Right around 1% I believe was our decrease in length of haul. Chris Ceraso – Credit Suisse: Any more color on why the sourcing business was so strong? It seems to be a real standout performance relative to just about everything else that’s going on in the economy.

I think kind of what we said, just more consistency and the level of activity around produce. Obviously, we’ve had success in building our relationship with our current customers so we’re constantly seeking new commodities, new categories. Things like weather freezes and different things can eliminate categories for certain periods of time so I think decent groups, decent relationships, steady volumes in produce, we just had a good growth quarter. Nothing really new or magically different about what we were doing. Chris Ceraso – Credit Suisse: Was it an easier comp because of weather or something a year ago?

I think there were some but it’s difficult to compare specifically commodities because our participation at any customer level may be varying as well too so it’s always hard to isolate what the weather caused versus what the changing relationships caused.

Your next question comes from John Barnes – BB&T Capital Markets. John Barnes – BB&T Capital Markets: Could you talk a little bit about, I know you’ve talked in the past about it, it’s kind of up to your branch managers and that type of thing but how much additional business could you layer back in before you would have to begin to layer in even more costs before the training costs would go back up and that type of thing?

I talked about before if you assume that prior to the brunt of the recession hitting last November/December that we were sort of properly staffed the level of productivity that we were operating at, we’re obviously still not back there today. We could grow probably another 5% to 10% in terms of volumes to get back. If we’re at constant headcount or staffing compared to a year ago but our volumes are down roughly 10%, we should be able to come back to that. Now, that’s over simplifying it a little bit because as we talked about earlier, you know meaningful parts of the total compensation are the variable bonuses and incentives so it doesn’t work quite as simply as what I just described but in general that would be the productivity metric around loads per person that would guide us to that. John Barnes – BB&T Capital Markets: I wanted to go back to a comment you made earlier about I just want to clarify what you said that the carrier leads and the shipper probably follows, that the carrier reductions tend to happen quicker. I just want to make sure that is what you said?

That is what I said. When you look at market adjustments in pricing, it’s generally to be more specifically even, it’s generally the larger carriers that tend to have the larger impact with changing prices in the marketplace. John Barnes – BB&T Capital Markets: Of the bids that are currently out can you give us an idea of kind of the ones you’re participating in, how much of that is existing business that you’re already involved in and how much of it may be new customers that you’re trying to get involved with?

Most of the bids would be with existing customers but typically what happens is if you have a customer who has generally 50,000 shipments or make up some number and we’re doing 5,000 or 10,000 of them, they’ll do a bid for 80% or 90% of their lanes. So, the lanes that we’re participating in we’d have to rebid in but we would also hopefully rebidding on a bunch of new lanes and then you win some, you lose some and you kind of see what happens from the result of that. It’s generally with existing customers but the level of what that play is probably much broader. If that makes sense. John Barnes – BB&T Capital Markets: One last question, on the legal case that you just described do you have anything else of similar magnitude that this could have some influence on?

As the lawyers have explained to me a jury verdict does not set new law or new precedent. Judges writing opinions on like if they would have granted our pre-trial motion like they have in the past on similar cases it would have obviously set a precedent and there is precedent out there that this case shouldn’t have proceeded to trial on our opinion. As far as yes, there are other less than five other major accidents where we have brokered the load that we are aware of at this time. But, most of those we have not even been sued in. John Barnes – BB&T Capital Markets: There’s less than five, is that what you said?

Of major accidents that we’re concerned of. John Barnes – BB&T Capital Markets: But nothing out there that would lead you to believe that there’s been a change in the outlook on how these cases are going to be handled on a go forward basis?

Correct.

Your next question comes from Jon Langenfeld – Robert W. Baird & Co. Jon Langenfeld – Robert W. Baird & Co.: These headcount reductions can you just talk about the timing of how those occurred? Where those throughout the quarter? And then the levels, were they focused at certain levels or certain geographies or kind of across the board domestically?

The personnel changes were throughout the quarter and again, we make those decisions on a pretty decentralized basis so we have all of our offices and some of the corporate functions and in each of the areas we have pretty well established productivity goals and score cards and metrics that guide us and really across each office and across each location there would be unique decision making as to the level of experience and the mix of people and how the changes were made. What was maybe a little bit more input from corporate in this type of environment is seeing what we are hearing from our customers and the marketplace that we were encouraging and pushing to correct to our metrics a little bit quicker than maybe we would do if it were a smaller number of offices in the past who were transitioning to different levels. So, it was across the network in a wide variety of locations with highly decentralized approach as what types of changes were appropriate. Jon Langenfeld – Robert W. Baird & Co.: Then how do the various bonus tools work? Maybe there’s not a single answer to this but if I’m in a branch and I have a bonus pool and we’ve reduced headcount by 5% or 6%, does the bonus pool then get redistributed among the remaining players or is the bonus pool lower? How do you think about that? Chad M. Lindbloom There’s at least two different buckets of bonus pools at each branch. One is the growth pool which is when branches grow faster than you expect them to which in most likelihood if branch is reducing headcount because they have less volumes they’re probably not going to hit that growth pool bonus and that’s one that is a pool that is divided up at the end of the year. So, that one the dollars would stay the same if there were less people participating but again, that would be an unlikely situation. Then the core bonus programs are each person has a percentage of the pre-tax, pre bonus profit of the branch. So, when those people would go away that bonus expense would go away as well.

Although to the extent that there are reductions that improved the profitability of the office, everybody’s bonus participation would be enhanced. So you’re not formulaically reallocated but in essence the idea of right sizing the personnel needs is for everybody’s financial health. Jon Langenfeld – Robert W. Baird & Co.: Are there any other additional cost initiatives or things that you’re looking at differently today from a cost perspective that maybe you weren’t doing six or 12 months ago?

I think Chad talked through some of the SG&A categories around discretionary spending where we’re certainly managing a little bit differently today. For a growth company like us that is expecting to grow and expand it’s challenging at times to think about traveling less or doing a little bit less in some of the discretionary categories but when your volumes drop you have to adjust accordingly to the level of activity and discretionary spending. So, we did make some decisions around those discretionary items. But, other than that we’re trying to stick to the strategy and run the business like we always have.

Your next question comes from Alexander Brand – Stephens, Inc. Alexander Brand – Stephens, Inc.: Just a quick question for you on your LTL volumes, obviously most people aren’t growing their volume. Got any thoughts on maybe what you’re doing to attack the market or take advantage of some of the known weaker players that’s allowing you to get some growth right now.

I think the longer term thing about LTL that has been guiding us is like I said in my prepared comments that we are really focusing in on relationship management and cross selling. We believe we’re getting a lot of LTL opportunities from truck load type customers where we can manage the relationship pretty effectively because we already know them and are doing business with them. I think the other thing that we’ve talked about internally that may be helping us is that when there is such a high degree of volatility and instability in the market it’s probably more challenging for a typical shipper to switch providers and be confident in what they’re doing than it is for us to manage things. So part of the benefit that you get in working through us is that you get to move with the market fairly fluidly because we have automated relationships and a lot of relationships so it’s possible that in this type of an environment what we’re bringing to the table as our value add is more appealing. But, I think probably the more important driver is just that we’ve been emphasizing in it and we’ve been training in it, we think we’ve been getting better at it, more efficient, more automated and selling it more aggressively.

Your next question comes from [Ken Hector] – Merrill Lynch. [Ken Hector] – Merrill Lynch: Chad, you talked a lot about the customer’s reacting, how long does it take before the customer realizes that pricing in the market is different than what you’re charging? How quickly can they adjust? Chad M. Lindbloom It really happens continuously in a falling market it’s just like when John mentioned, we’re buying capacity on a daily basis so that adjusts real time where there is a month, two, three depending on the situation lag in repricing to the customers. Again, it’s hard to predict what’s going to happen because even as we continue to reprice the customers potentially downwards in different bids as they’re bidding based on a weakened market, if the market continues to get weaker the carrier pricing could fall more or you could have the inverse as John mentioned. If things start to firm up, our margins could get contracted a little bit when pricing in the spot market as well as volumes start to increase. [Ken Hector] – Merrill Lynch: Now, you said your volumes were down 10% on the truck load side, what do you think the market was?

We look at probably the same indexes that you do. I would say maybe a little bit worse than that mid teens. [Ken Hector] – Merrill Lynch: John, do you think then your market share gains decelerated? I guess if you look at you were kind of 15 to 20 points above the market if I remember back in the third quarter, maybe a little bit less than that in the fourth quarter. Does it seem like your market share gains are decelerating a bit?

Possibly. Market share things for one quarter get really tough to gage. Again, I said earlier we’ve never lived through this type of industry drop before so how do you know but with the kind of complete absence of year end, quarter end surge, I don’t know it’s hard to say but it could be that the rate at which we’re taking share is varying. But again, it’s hard to tell over a short period of time. [Ken Hector] – Merrill Lynch: I was kind of surprised by the answer before of your view on the capacity that your still not seeing any larger shift of I guess carriers leaving the market. I know you’ve always said it’s an imperfect science but from your reach of the amount of carriers that you deal with what do you think it’s going to take in order for more of that capacity to leave in order to allow I guess a better supply demand dynamic in the market place especially when you talk about volumes being down as much as they are?

I think it’s a pretty natural self correcting phenomenon and it could be already happening and we’re just not seeing it as serious of an issue because of the scope of our network. Kind of like we talked about and I think has been pretty consistent across the industry, if you factor out fuel, you know price declines for this type of volume drop haven’t been that great up until recently. So, some of it comes down to the timing of how much lower do rates have to go and how long does that have to persist before a driving or a carrier would decide that that’s not worth it anymore. We talked a lot about the rate increases and the compensation increases that came with it back in 2004, 2005, 2006. A lot of this kind of comes down to what does it take to retain drivers and what does it take for an owner operator to stay in the business and accept that level of compensation. It’s all the kind of natural correcting market forces of how much lower does it go and how long does it have to stay there before people would decide that it’s not worth it. [Ken Hector] – Merrill Lynch: Do you think you’ve seen that accelerating recently as you say the prices have gotten a little bit more aggressive or is it still too early in that process?

We don’t get good day-to-day visibility to it. I would think that would be a natural conclusion but again, I think what a lot of shippers and especially maybe all of us are really trying to sort through right now is are these temporary seasonal price declines or are they permanent? All the bids that are going on right now there’s a lot of discussion around who will really honor the contractual rates and what will load acceptance ratios look like if the market does tighten up in the fall. So, everybody has to make decisions through these processes about what types of savings are sustainable and how aggressive you should be in trying to capture them in the short term versus your long term relationships. It’s a much more dynamic process with a lot of different variables. [Ken Hector] – Merrill Lynch: Just the last quick one on intermodal was up actually year-on-year, is there anything going on within intermodal? Are you growing in a particular region?

I think it’s pretty widespread. We’ve talked a lot the last couple of years actually about believing that we’re getting better at executing and better at multimodal offering of truck and rail compatible freight. Even going back a couple of years ago our volumes were increasing but we were rearranging the margins and carrier relationships so we’ve had good momentum from an execution standpoint and a sales standpoint over the last couple of years. As I mentioned earlier all areas including intermodal have certainly seen a slowdown from the recession but we had pretty good momentum coming in to it that’s allowing us to continue to do some good things.

Your next question comes from David Campbell – Thompson Davis & Company. David Campbell – Thompson Davis & Company: John and Chad, from what you said it sounds like there was no increase in [inaudible] in March compared to January and February on a daily basis. But then you said the downturn was about 10% each month year-to-year so wouldn’t that imply some increase in March?

I don’t think we ever said volumes didn’t grow sequentially in March over February. If we did, we didn’t mean to. Growth was relatively consistent throughout the quarter. David Campbell – Thompson Davis & Company: You had that increase in business sequentially in March, whatever it was. As the employee count was going down, am I to take it that you could continue to increase this amount of tonnage and keep the employees flat for a while?

Yes, that would be our hope. Like I said earlier if we’re roughly flat in staffing levels and we’re running at volumes that are 10% a year ago ideally we could correct back up to prior year levels before we would need to add meaningful costs.

Your next question comes from Nate Brochmann – William Blair & Company. Nate Brochmann – William Blair & Company: I just wanted to talk a little bit more and flesh out the market share gains a little bit. I’m sure it’s a combination of everything in terms of the cost savings that you can offer customers, your flexibility in cross selling and probably some disruption too in the marketplaces you guys have always said that you benefited from. But, in general could you maybe flesh that out a little bit in terms of where you think you’re gaining the most share and seeing the most opportunity out there?

I think you just gave a pretty good summary of it. Part of the message that I think we’re trying to deliver is that third party logistics and what Robinson is all about is trying to bring flexibility and choices and a different level of customer service to the marketplace and each environment gives us new lessons in all the rest of that. But, really when you step back from it I think a lot of what’s going on is things that we’ve been doing for the last couple of decades is to try to get to know our customers better, to try to help them through the difficult times, to try to solve problems with different mode alternatives with truck versus rail or where less than truck load and truck load meet and what the definitions of those are. Lots of information and reporting, so we have lots of things that we can talk about on this call that are very core to our culture around how we sell and service and manage accounts and train people and try to be innovative and develop solutions and all the rest of that. I think over a longer period of time that’s what we would really attribute to market share gains. It’s just our basic fundamental approach to the market place. How it varies month-to-month, quarter-to-quarter and kind of what really applies during this type of a radical change in the market place gets harder to sort out in the short term. But, over the longer term that’s what we feel has been good for us. Nate Brochmann – William Blair & Company: And probably rings true even more so today with where we’re at in the environment I would assume?

Hopefully so, when you’ve got industry volumes declining the way they were and so much transition going on and a lot of customers being forced to react in a lot of different ways. It’s hard to gage exactly what came from account management and what came from luck and what’s bad luck and all the rest of that but hopefully that’s true, that the things that we’ve been doing for a long time are serving us well now. Nate Brochmann – William Blair & Company: One last quick question, I know we’re just about out of time, to ask the capacity leaving the market a little bit differently, are you seeing and I know that you’re doing a great job on the AR side too, but have you seen any disruption like in the T-Chek business in terms of some of the smaller carriers not being able to pay their fuel cards or kind of being a little bit more lagging on those as a possible indicator?

Yes, we have. I think T-Chek’s business has been impacted pretty significantly by declining volumes so there’s fewer transactions. You’ve got declining fuel prices where some of the transactions are base off of that and then they’ve had some credit challenges as well where the carriers are the customers and they’ve had a difficult time paying their bills or some of the bankruptcies I think we’ve talked specifically about in some of the previous sessions. So yes, it’s a challenging environment for T-Chek right now but we’re managing through it like we are the rest of them.

I’ll turn the conference back over to you.

We apologize that we could not get to all of the questions today, we ran out of time. Thank you for participating in our first quarter 2009 conference call. This call will be available for replay on 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 entering the passcode 11128676 pound. The replay will be available at approximately 7 PM Eastern Time today. If you have additional questions, please feel free to call me, Angie Freeman at 952-937-7847. Thank you.

Ladies and gentlemen that will conclude today’s teleconference. We do thank you again and at this time you may disconnect.