Good afternoon, ladies and gentlemen, and welcome to the C.H. Robinson Third Quarter 2012 Conference Call. [Operator Instructions] As a reminder, this conference is being recorded, Tuesday, October 23, 2012. I would now like to turn the conference over to Angie Freeman.

Thank you. On our call today will be John Wiehoff, CEO; and Chad Lindbloom, CFO. John and Chad will provide some prepared comments on the highlights of our third quarter performance. We will follow that with a question-and-answer session. [Operator Instructions] Please note that there are presentation slides that accompany our call to facilitate the discussion. Slides can be accessed in the Investor Relations section of our website, which is located at chrobinson.com. John and Chad will be referring to the slides in their prepared comments. Finally, 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. And with that, I'll turn it over to John.

Thank you, Angie, and thanks to everybody who has taken the time to listen to our third quarter call. I'm going to start my prepared comments on Page 3 of the slide deck that Angie referenced. That slide highlights some of our overall key metrics for the quarter around our financial performance. For the third quarter, our total revenues grew 6.9%. Our net revenues grew 2.3%. Total revenues grew faster than our net revenues due to our volume growth and the impact of net revenue margin compression. Our income from operations grew 1.8%, and our earnings per share increased 2.9% to $0.72 per share. Chad will make some prepared comments later on about our operating expenses but overall, the goal of our business model is that our net revenue and earnings growth should approximate each other, so we felt for the quarter that our model performed as expected. While those are some of the key financial metrics for the quarter, I'm going to go into some comments by each of the various services that we offer. But before we do that, I thought since many of those comments by service line are consistent with the last couple of quarters that I would start by highlighting some of what the overall trends and events in the environment that we feel are dominant throughout our explanations. We've talked a lot this year and the last about the change in the marketplace, especially around shippers and in a slower growth environment that in the balance of their supply chains around growth and efficiency that we have felt a lot more focused on efficiency. When we're meeting with our customers, there generally is a very aggressive approach towards trying to reduce cost and improve efficiencies in their transportation spend and supply chain, much more…

Thank you, John. Slide 11 is our summarized income statement. I'd like to highlight a few things for the quarter. We are pleased to -- we are pleased that we continue to operate very efficiently. In the third quarter, our operating income as a percentage of net revenue was slightly lower than the third quarter of 2011, but at 43.3% was still at the high end of our historic range. In the third quarter of 2012, our headcount ended the quarter 8.5% higher than last year's third quarter, but our personnel expenses increased less than 1%. Increases in salaries and other expenses related to the increased headcount were largely offset by reductions in some of our incentive compensation and equity compensation programs that are based on growth and earnings. Our stock-based compensation expense for the quarter was approximately $4.5 million compared to $9.5 million in the third quarter of 2011. Growth and other operating expenses was driven by increases in many different areas, including travel, provision for doubtful accounts and approximately $1.5 million of acquisition and divestiture, legal fees and due diligence fees, both from a legal and accounting perspective. Talking about travel. Our people have continued to focus on long-term growth. Our people are out working on sales and account development, which has led to this increased travel. Phoenix due diligence also increased our travel expenses during the quarter. Moving on to Slide 12, we continue to have a strong balance sheet with cash and cash equivalents at the end of the quarter of approximately $273 million. Since the end of the quarter, we have also received $302.5 million for the sale of T-Chek and expect to use $571.5 million for the cash portion of the purchase price of Phoenix at the end of the year. We expect to enter into a $500 million revolving credit facility by the end of this month due in part to finance the acquisition of Phoenix. Moving onto our capital expenditure activity. Our net CapEx, including investments in software, was approximately $13.9 million for the quarter. As we mentioned last quarter, we took delivery of 500 additional intermodal containers, bringing our fleet to a total of 1,000. The cost of these incremental 500 containers was approximately $6.6 million. $2.2 million of that was paid in Q3 of 2012 and as we mentioned, $2.8 million of that was included in our second quarter's capital expenditures. During the third quarter of 2012, we repurchased 1,079,674 shares at an average price of $54.99. The share repurchase happened in the first half of the quarter. During the second half of the quarter, we ceased repurchasing shares because the company was in possession of material nonpublic information. And now I'll turn it back to John for some closing prepared comments regarding our strategic alignment.

As I mentioned earlier, since we've had several press releases since our last earnings release, we thought maybe we would just share some prepared comments to tie together some of our activities and plans for the future. We announced an acquisition of Apreo in Poland towards the beginning of the quarter. We also announced the acquisition of Phoenix International, which I referenced earlier. When we look at our plans for the future and our portfolio of services, one of the conclusions that we reached is that both in the European continent and in our global forwarding services, we feel that there are opportunities to improve our growth prospects and our competitiveness by being larger and investing in some scale. While we've been talking about expanding our global forwarding network and looking for strategic investments for quite some time, we've also talked about the fact that we were going to have a very high filter on the cultural fit and making certain that we've thought there was good synergies to the types of organizations that we would combine with. We did feel that Phoenix was a very unique opportunity for us and that it's a great cultural fit, and it will allow us to really change the scale that we operate within the global forwarding business. So in reviewing our portfolio, because supply chains are more global and many of our services are connecting with our customers on a more global basis, and because scale matters in the effectiveness of those services, we felt it was an easy decision to move forward with making an investment like that. Similarly, as my comments earlier around T-Chek, when we look at the consolidation in the Payment Services industry and the card services that T-Chek operates in, there's a comparable movement towards consolidation and…

[Operator Instructions] Our first question comes from the line of Nate Brochmann with William Blair & Company. Nathan Brochmann - William Blair & Company L.L.C., Research Division: John, just wanted to talk a little bit -- I mean, obviously, there's a lot going on with your business, and I definitely applaud you for looking at the other areas of growth and see how things are changing. As supply chains kind of evolve and become more flexible, do you feel that you're now in a great position to kind of take advantage of that? Or are there still more pieces of the puzzle that you think that you need to add over time or other places that you'd like to be?

We are proud of what we think we can do from an integrated services standpoint to help a shipper with broader supply chain needs, everything from network analysis and modeling to all the various types of transportation or logistic needs that they might have. When you get into the specifics of our customer relationships and all the various needs that they have, it would be unrealistic to say that we have everything or that we feel that we can do anything that any of our customers would need. There's a lot of incremental information and analytical components of the supply chain that we really want to continue to strengthen. There's a number of inventory management and consolidation-type things that we know we can get a lot better at. Even within the transportation offerings, there are certain lanes or niches around hazardous materials or other things that we're working to invest more aggressively on. So we feel good about our footprint and the broader capabilities that we have. But we know there's also a lot of opportunity to continue to strengthen and expand the service menu. Nathan Brochmann - William Blair & Company L.L.C., Research Division: And just how fast do you think that, that changes and continues to evolve? Obviously, you've seen a lot of change over the last couple of years as you alluded to. Does that change even more rapidly in terms of the adoption of kind of more complete solutions, or do you think that is just an evolutionary kind of track?

It's actually been going on for quite some time if you look at really over the last 10 years around some of our transportation management services and our global forwarding investments. I would say the macroeconomic environment and the change in our -- what we see as our customers focus on efficiency and cost savings over the last couple of years has fairly accelerated it. Whether it will stay that way probably has to do with the combination of how our customers and how the industries continue to change, and if they stay focused on efficiency and less focused on growth, or if we get back to an economic growth scenario, as well as how we interpret the investment opportunities in the marketplace and whether or not from a price and cultural fit standpoint we find the right sort of thing to invest more aggressively in.

Our next question comes from line of Ben Hartford with Robert W. Baird. Benjamin J. Hartford - Robert W. Baird & Co. Incorporated, Research Division: Chad, you had mentioned the $1.5 million in legal and accounting fees and due diligence and then the additional expense associated with increased travel. The bad debt expense, did you quantify that? I guess I'm interested if we could just get -- if we could quantify this quarter in the other expense line item, how much is truly onetime versus recurring?

Sure. Let me talk about the provision for doubtful accounts. You can actually see that amount on the cash flow statement. Maybe -- I guess for the quarter you'd have to back into it because we only give a year-to-date cash flow statement. But the provision for doubtful accounts this year's third quarter was $4.5 million versus last year's third quarter was $2.9 million. As far as the onetime nature of the expenses, now there's $1.5 million approximately of specific dealer-related legal and outside accounting services related to primarily the acquisition, but there was also some legal fees associated with the divestiture of T-Chek in there as well. Those are definitely more of a onetime nature. We're not done with deal-related expenses on the acquisition because the deal hasn't closed yet. And there is an investment banking fee that is contingent upon closing that is close to $8 million. And then to get up to the estimated total amount of $8 million, there's also some additional tax and legal due diligence ongoing between the signing and closing. Benjamin J. Hartford - Robert W. Baird & Co. Incorporated, Research Division: Okay. Good. And then I guess, John, when we think about -- we think about productivity. If you look at gross profit per employee, it appears that we're at an inflection point, at least as it relates to the year-over-year decline. Can we separate and how much is environmental versus how much is associated with the new hiring and the drag that, that's created on a gross profit per employee basis? I'm just trying to get a sense for how much of it is associated to the pressures that we're facing on a gross profit per unit basis as opposed to what might be related to the on-boarding of -- and the growth of the employee base.

This is Chad, and it's really difficult to isolate the 2 impacts because definitely, we know when we have tighter margin percentages it takes more work or more transactions to generate the same amount of net revenue. That compounded with the fact that we're up 8% or 9% in headcount, and in addition to that have replaced turnover. We're in the 20-plus percent range, 20% to 25% range of new -- people new within the last year. So definitely those people also generate less net revenue per person, but it's really difficult to precisely quantify the impact of the 2.

And our next question comes from the line of Bill Greene with Morgan Stanley.

John, can I ask you for a little bit more clarification on your comments about the repurchases? I understand that's a board decision. But is it management's view that a good use of capital now is to actually buy the shares when they're at a valuation that we've not seen for a very long time, if at all, since IPO. So I would think the more aggressive capital structure would make sense, but I'm curious as to what management would suggest the Board do.

Part of the reason for the way I phrased my comments was that for quite some time now, what we've said around our share repurchase philosophy is that we would use what we determine to be excess cash amounts to repurchase shares, and that it was more of a capital distribution philosophy than a valuation play. But we also always said that if we ever felt like the valuation parameters got to the low end or below our range for executing that philosophy, that we would reconsider. So given the fact that through these acquisitions, we will have some level of debt going into 2013 and because we do believe that the valuation is at a level that's lower than any time in the last 10 years from a multiple standpoint when we were looking at our purchase price activity, we do feel like a different philosophy probably makes sense. We need to spend some time with our Board to be precise around exactly what our new targets will be or exactly what parameters will execute those share repurchases under. But yes, we do feel like a different capital structure will be in place and is appropriate, given a low interest rate environment, the low valuation of the stock and some of the growth opportunities that we think we have.

For much of the period since we went public, it was only slightly accretive, if accretive at all, to repurchase shares based on the combination of where interest rates were, as well as where our PE was. Both of those have changed in the directions that obviously make share repurchases more accretive.

Yes, no, exactly. Lastly, just -- can you talk at all about the October trends? I arrived late to the call, so if you said that, I apologize. But I don't think I caught that.

Okay. We did not comment on the October trends. Part of the impact of the transactions that are happening, it makes those numbers less comparable or less indicative of what the whole quarter would be, even though the first 3 weeks of the quarter never does tell the whole story. But just so you realize that until we have a systems integration on the Phoenix acquisition starting with this quarter, we're not going to have daily net revenue information available like we do today. So for sure, beginning next quarter, we could not provide you what the first month or the first 3 weeks or 4 weeks of a month were. So we're going to have to discontinue the process going forward. We will give you -- through October 22, truckload volume per day was up 6.5%. In that if you exclude the T-Chek revenues from both quarters that our net revenue growth was up approximately 5% in that same period in October. Again, this is probably -- likely the last time that we'll be able to give you a number like that for the foreseeable future because of the systems integration or the lack of availability of comparable numbers on a daily basis. And then even once we do have a system integration, it will take another year to have comparable numbers.

But even -- but Phoenix, they don't do truckload, do they?

Do not do truckload. We would have -- or they do not do a significant amount of truckload.

Right. So you would still have truckload, you just wouldn't have the total for the corporation.

Yes, we will not be able to give net revenue numbers the same way that we have been giving them in the past.

And our next question comes from the line of Ken Hoexter with Merrill Lynch.

Chad, just to clarify, that you would still be able to get the truckload volumes on a per day basis, right? I mean, leaving off the total company net revenues, right?

The slightly less precision for the acquisition in Poland until it gets on our system, as well as any truckload activity that is -- and again, it's very small, that is booked by Phoenix. But we won't have the same level of precision for the next year or so on those numbers.

I just wanted to follow up. John, you said on your opening slide, you aim to grow truck gross and net at the same pace, but you did 2% versus 7%. A little bit smaller gap than last quarter's 0% and 9%. Obviously, that's the sequential boost of the net margins but away from the first quarter where both were up 7%. So what does it take to get back to the equilibrium and how do you get there?

Well, just to clarify what I intended to say, at least in my opening comments, is that our business model goal is that our net revenues of growth of 2.3% and our earnings growth -- earnings per share growth of 2.9% would reflect the variable nature of our cost structure. Over time, the gross revenue and net revenue would hopefully grow similarly as well too when we go through a period of time of margin compression like we have for the last several years, net revenue is obviously going to grow slower. So what we need in order to get back to a more comparable net revenue and gross revenue or total revenue growth is a period of time where we have flat or expanding margins. So as we've been saying for the last couple of years, we really need to find bottom on the gross margin comparisons or the net revenue comparison, and then continue to grow our volumes and both total revenues and net revenues should grow at a more comparable rate going forward.

So when you talked about pricing being flat and truck cost being up, are you indicating then you're still seeing that compression going on, or given the net was up sequentially that you feel that you've turned the corner on expanding those margin?

So with flat pricing to shippers and a small increase in the cost of carriers for the quarter, we did for the quarter continue to see that compression. As I said in my comments, it did begin to ease during the quarter and ended the quarter at fairly comparable margin percentages for the previous year. So we don't know what the fourth quarter will look like because there was some improvement versus a year ago. So depending upon the supply and demand relationship in this fourth quarter, we could be hitting bottom or turning that quarter. But it's been difficult enough the last couple of years that I really can't make that prediction. But hopefully...

Okay. I appreciate it. What's that?

I said but hopefully it is.

And our next question comes from Scott Group with Wolfe Trahan. Edward M. Wolfe - Wolfe Trahan & Co.: It's Ed in for Scott. Just to further up on Ken's question, is there a way, Chad, to look at how the quarter progressed kind of on a year-over-year margin on the transportation yields? You said by the end of the quarter they were basically flat. How do they start and then how do they progress through the first couple of weeks of October, if you don't mind?

The -- when you look at the 2 quarter -- the 2012 quarter compared to the 2011 quarter, total transportation net revenue margin was increasing in 2012 and it was decreasing in 2011. So there was a relatively large spread at the beginning of the quarter. But by the end of the quarter for the month of September, the numbers were very comparable to each other. So far in October, most of our revenue margins on transportation are relatively flat with last year's October, maybe slightly lower if I remember correctly. That's a very tough number to get in for the quarter because there's intercompany sales that need to be eliminated or intra-month because there is a little less precision on the margin percentage, but we believe that they're very close to each other for the month of October. Edward M. Wolfe - Wolfe Trahan & Co.: Can you give the net revenue year-over-year growth numbers for transportation? I think that it was 1% in July. Last time you had commented through 3 weeks and you said 5% so far in October. Can you give what July was for the full month and then August, September?

No. No, we're not going to disclose that. Edward M. Wolfe - Wolfe Trahan & Co.: Okay. In terms of the -- you talked about the $1.5 million of legal expenses for the divestiture and acquisition, and there's going to be some more. Is there any way to break out what some of those costs will look like in the fourth quarter?

Yes, John mentioned I think in his prepared remarks on the last slide or at least the number was highlighted that we expect on Phoenix to have approximately $8 million more of transaction-related expenses. The biggest portion of that is the investment banking fees. Edward M. Wolfe - Wolfe Trahan & Co.: And that will include the legal in the quarter as well?

The legal and the tax due diligence will be -- or it might drive it slightly over $8 million. The investment banking fee is a little bit under $8 million, so I think $8 million overall is a relatively good estimate. Edward M. Wolfe - Wolfe Trahan & Co.: Okay. And last one is part of that. It seems like there wasn't -- despite strong cash generation in the quarter and $240 million of cash going into the quarter, you didn't generate any interest income in the quarter. Was there something--did you put some cash for Phoenix's side somewhere or do something that curtailed the income in the quarter? Is there something else?

No. I mean, yields are just extremely low. Not all the cash on the balance sheet is invested. A lot of it is spread around the world in operating accounts. Edward M. Wolfe - Wolfe Trahan & Co.: Because last quarter it was $700,000. And this quarter, there was less than $100,000.

Last quarter, we had an unusual item of -- we talked about it of a passive investment that we had made many years ago that we got a distribution from.

And our next question comes from the line of John Barnes with RBC Capital Markets.

I guess today on one of the truckload carriers calls, they indicated that basically, pricing was not as firm as the quarter progressed and that their customers were less concerned about capacity availability in the marketplace. I'm just kind of curious, while your margin compression obviously was there on a year-over-year basis, it was not -- you had sequential pickup. I heard what you said about it but improving through the quarter, but can you give us a feel for where you felt capacity was at the end of the quarter? And do you think -- can you just give us a little bit more color as to do volumes tighten up enough or firm up enough in the fourth quarter that you think that tightens back up, or do you think that we're in a looser capacity situation given the macro environment kind of overweighing whatever we see on the peak basis?

I think the comments that you just shared are consistent with what we saw or we feel -- market tightness is always relative. But from our perspective, the market did loosen as the quarter went on, which is what allowed that easing of some of the margin compression. And what most of us have been talking about this year is there really hasn't been any measurable peak season or tightening in the fall like there had been in some previous years. So it feels overall to us like fairly soft or consistent demand environment and not a lot of tightness or a fairly loose market finishing the quarter and going into the fourth quarter.

Okay. And then...

Some of that has to be taken in context though too that there's been periods of time where the market was much more volatile and the relative ranges of a tight market or a loose market were much greater than what we're seeing today. So when we look at our route guide depth and some of the other metrics that we would look at to try to assess the market tightness, while it loosened a little bit near the end of the quarter, it was nothing like the first half of 2009 or other periods of time where that supply and demand fluctuation would be much more greater than what we've seen for the last couple of years.

Okay. All right. That makes sense. All right. And just a question on -- obviously, you made the comment about how many times we've heard from you guys since your last earnings call. I mean, this is obviously, you've had a lot going on with acquisitions and divestitures. I'm just curious. Are you concerned at all about taking your eye off the ball at all on the core business? And I know you've got this big, decentralized -- and you put network and you put a lot of responsibility into your branch managers' hands, does that protect you from maybe the risk of taking your eye off the ball on the core business as you kind of go through what's going to be a big acquisition and a large divestiture?

I think when you kind of break it down, first off, when we had a lot of activity, I do feel like in many ways, it's coincidental around some things that we've been working on for a long time that finally just came to fruition in the last quarter. So I don't feel like this is a new environment for us where we're going to be so much more aggressive that we change the culture or start driving our growth in a different way. But first off and although the divestiture of T-Chek was a lot of effort, hopefully, that will give us some more narrow focus going forward. Expanding our global forwarding network has been something that we put a lot of energy into over the last 10-plus years. One of the things that we got with the Phoenix acquisition is a new leadership team that is going to help us really in a different way than what we've had before. We needed leadership and we needed expertise in that service line, and we're pretty excited about the team that we got and the success that they were having. So a lot of the integration effort will be led and absorbed by new people to Robinson who came with that acquisition. We certainly had some talent that will be an important part of that team as well too. But when we think about 2013 and looking forward, integrating Phoenix with our global forwarding business is clearly at the top of the list of things that we will stay focused on. It is a dedicated team that's separate from the North American transportation business and should be able to operate largely on their own. The other acquisition in Europe, we have a separate leadership team over there as well too. So we don't feel too stretched or spread out at this point going into 2013. But it is a fair point that whenever you have this kind of activity or change going on, that we need to make certain that we don't dilute our focus or our cultural consistency across all of our services, and we're very locked in on making sure that doesn't happen.

And our next question comes from the line of Tom Wadewitz with from JPMorgan. Thomas R. Wadewitz - JP Morgan Chase & Co, Research Division: Yes, let's see. We wanted to see if you could -- I guess give a sense here on the headcount and volume relationship that you expect, and how you expect those things to look the next couple of quarters? Are you planning to slow down the headcount additions, or you think you're going to keep it the same? And how do you think about volume growth and what seems to be a fairly weak economy in general?

Yes, so first off, just with the acquisition transactions that we expect, there will be a pretty significant change in headcount going into the fourth quarter. So for modeling, don't forget that Phoenix has about 2,000 employees. But if you cleanse the transactions in the normal productivity level over the last several years as we started to reach the high end of our productivity levels and probably around a year or so ago, started to staff up more aggressively, I think for the last year or so, so we've averaged about 8% or 9% headcount increase in our reportings. While you have to break it down to really understand it precisely, probably the most visible metric that those headcounts should correlate to over the long time -- over the long term would be truckload volume growth because that's our biggest portion of our business. So while we had 8% volume growth in the quarter and 8% or 9% headcount growth, if volume growth continues to slow, we're pretty quick at adjusting that spigot and slowing down the hiring. So from a North American truckload standpoint, we feel like hopefully those 2 would stay pretty well and in sync going forward. And that we're going to continue to look at trying to aggressively take market share because we think that's the best answer in the long term. Each office will make that decision on their own around what their sales pipeline looks like and where they think they can gain share with reasonable margins. But over time, that's how we would think about headcount growth. Thomas R. Wadewitz - JP Morgan Chase & Co, Research Division: Okay. And what do you think about, I guess the impact of weak freight versus competition? I know it's hard -- it's a big market, it's kind of hard to tell what hurts you or helps you. But do you think the bigger issue here in terms of your slower pace of net revenue growth and earnings growth and so forth, is it just a really a demand issue? When you seeing a stronger economy, that's really the biggest thing and stronger freight market, or do you think that it's really -- there is some impact from some of the private brokers that are pretty focused on growing at a fast pace, and maybe just willing to take lower gross margin than what you guys have had historically?

That's a good question. And as we've been asked this and have thought about it and analyzed it for the last couple of years, there's definitely a lot of factors at play. I believe that perhaps the largest factor is that when you think about a third-party model and a business like ours taking market share, that the easiest way for us to grow and take market share is when a customer is growing and has new and different needs that they need help with that weren't planned for at the beginning of the year. And when I look back at our history and kind of compare it to the last couple of years, when you get into a more slower growth, more static environment with a lot of consistency in the freight, and shippers start bidding higher percentages for their freight more aggressively and are looking more aggressively for cost savings, it's frankly just a lot more difficult for a business like us to take market share than it is in a high-growth environment where there's just a lot of new and fresh opportunities to go after. So when the growth plateaus a little bit, if we're trying to aggressively take share and certainly, there probably are some competitors as well too, you start looking towards each other's current base of freight to try to get that market share and things tighten up and just get a lot more competitive. So I feel like in any industry, it's probably easier to grow your business when there's overall growth. But because third-party logistics has a lot to do with transforming the landscape and the industry around flexibility and different types of service levels, I think it's probably -- maybe even a disproportionate impact of the growth opportunity for somebody like us. So we're going to continue to sell and evolve our services to adapt to this environment. But yes, some economic growth and overall improvement in the freight demand would certainly make a big difference.

And our next question comes from the line of Chris Wetherbee with Citigroup.

Maybe just a question on the -- going back to the net revenue or productivity on a per employee basis. When you think about the mix that's occurring in the business with the acquisitions with the new stuff coming in, Phoenix, and losing T-Chek, does the still kind of the old kind of rules of thumb apply to the productivity on a per employee basis kind of when you think about seasoning the workforce? Obviously, you mentioned that you still have a bunch there of folks that are going to be kind of relatively new to the business. But as those people mature, is there any reason to think that there should be any material change in the ability of how productive they can be going forward?

Yes, T-Chek net revenue per person is not going to have a major impact. There was only 200 people or 190 people out of the total 8,000-plus before the Phoenix acquisition. When you look at Phoenix, they have 2,000 people. And if you do the calculation based on the net revenues that we disclosed earlier for those 2,000 people, you'll see that their average net revenue per person is lower than ours. So we've always talked about how our freight forwarding business had a lower net revenue per person. So as we continue to grow that international Freight Forwarding business, I think you will see some deterioration in our consolidated net revenue per person. That business is much more administrative-intensive even with the investments in technology that we've made. There's a lot more clerical, administrative-type work involved in freight forwarding than there is in truck brokerage because of the complex documentation requirements. So there will be a shift that's very difficult at this time to quantify it, but as we continue to go forward, we'll try to add some clarity to that.

About half of those 2,000 employees are in Asia. So the average cost per employee will adjust as well when those metrics come into our productivity cards.

Okay. That's very helpful. And then maybe switching gears back to the kind of capital structure discussion earlier in the call. When you think about some of the changes that are going on and where you think about yourself from a multiple perspective and allocating capital to share repurchases and otherwise, how do you think -- how does discussions about your long-term kind of growth rate targets play into that? I mean, any thoughts about how that might evolve as the business continues to evolve through acquisitions and just kind of maturity of the business going forward?

Yes, every time we talked about capital structure in the past, what we've said and what we continue to believe, with Phoenix being an example, is that if there is opportunities to grow our business, the highest return is organic growth. The next highest return is probably the right acquisition from an inorganic growth standpoint. And then we also feel like at the right time, we can create value by repurchasing our own shares. So what we're going to continue to look at is where are there opportunities for acquisition? Where are there opportunities to use our capital to grow service lines and create value. We always give the right freedom to grow organically and use working capital to grow any existing offices or open offices and fund that organic growth. But historically, we've had plenty of capital left for acquisitions and then some remaining capital that we've used for share repurchases. Because we think the value proposition is better around the current pricing, what that's going to do is really cause us to look probably more specifically at what we think our acquisition activity and demands for capital might be and what levels of debt, if any of that we're comfortable with, continuing to carry just simply because of the value opportunity and share repurchases. So it gets to be a loop of all that. How much do we think we need for our organic growth? What type of acquisition opportunities do we expect? And then what level of capital structure are we comfortable with to execute share repurchases.

And our next question comes from the line of Tom Albrecht with BB&T Capital Markets. Thomas S. Albrecht - BB&T Capital Markets, Research Division: It does feel in some ways like things are beginning to bottom a little bit, but I wanted to just get a little more clarity on the volumes. I was reviewing my notes from the late July conference call. At that point, TL volumes were up about 11%. And we know that for the quarter, they grew about 8%. We obviously know net revenues trended better, but it feels like volumes did get softer. How soft were they during the month of September?

As far as the first, just to cover the 11% versus 8%, this year's third quarter did have one less business day than last year's third quarter. Now we don't know that, that necessarily means there's one less business day's worth of freight that moved in the market. But if you make that assumption that it is true, that is about a 1.7% impact. So the number that we gave you in late July was on a per business day basis, and we had one less business day than we did last year's third quarter. Thomas S. Albrecht - BB&T Capital Markets, Research Division: Okay. So the 8% then, that's the total volumes and the 11% was a per day reference?

Correct.

And our next question comes from the line of Bascome Majors with Susquehanna.

Bascome Majors in for Matt Troy here. The cost creep at LTL carriers has certainly been attained for a long time, but it seems to have gotten much tougher as far as the margin compression as pricing has fallen over the last few months. I'm curious as to what you're seeing from your small and mid-sized carrier base as to any response from that yet with respect to how they deal with you as an intermediary.

Well, it's -- I don't think there's anything that we can say universally what -- when we talk about the metrics around the market and our earlier comments about the market softening, one of the things that we will see in our business is those larger carriers typically get much more aggressive about looking for backhaul capacity and expanding their available capacity in a broader way in the market. And when they do that, it tends to conflict more with kind of the medium and small carriers that don't have such fixed networks out there around how they run their equipment. So what typically happens when the market begins to soften like this as you will see a little bit more tension around competitive pricing between the big carriers and the small carriers. And we did see some of that activity towards the end of the quarter.

And our next question comes from the line of Jeff Kauffman with Sterne Agee. Jeffrey A. Kauffman - Sterne Agee & Leach Inc., Research Division: Chad, quick one on the tax rate. You're at 37.7% year-to-date. Are you trued up year-to-date and we should expect the fourth quarter pre-Phoenix to be at that rate? And then when you bring in Phoenix, they do have operations around the world. How is that going to change the tax rate we should be modeling going forward?

We expect the tax -- the core tax rate of C.H. Robinson excluding Phoenix to remain relatively consistent. We've talked about a 37.5% to 38.5% effective tax rates. When we look at Phoenix's operations, we would expect that tax rate, the core operational tax rate to stay consistent with what the -- what C.H. Robinson's tax rate is. We do prebook our tax expense assuming that eventually accumulated cash across the globe will be repatriated. So the fact that they are earning some of their earnings in lower tax jurisdiction, given that we have a cash generative business, when you look at the eventual use of those cashes, and you run out of eventual reinvestments without repatriation, U.S. GAAP says you should accrue the tax expense as if you were going to repatriate it in the future, which is the practice that C.H. Robinson has always followed and expects to follow. Jeffrey A. Kauffman - Sterne Agee & Leach Inc., Research Division: Okay. They will be maintained, in other words?

Well, there will be an impact to the overall tax rate based on -- and it's a number that we don't know precisely how much acquisition amortization we will have related to identifiable intangible assets as we have begun but do not have our purchase price allocation done. But any amortization expense, which could be -- it's very difficult to know the precise number but it could be relatively significant. I won't be surprised if there was a number in the $20 million per year range. That amortization will not be tax-deductible. So that could have an impact of 0.5% or 0.75% to C.H. Robinson's overall effective tax rate. So while the operational tax rate is staying the same, we could see a creep up in our overall effective rate because of that nondeductible amortization in the initial years of the acquisition. Jeffrey A. Kauffman - Sterne Agee & Leach Inc., Research Division: Okay. And in terms of looking at the expenses below the net revenue line, our -- at this point in time, can you -- are you comfortable telling us outside of the amortization how some of those are going to change if Phoenix is integrated?

Yes. I think if you -- once we have closed the transaction, post that, we will file some financial and quarterly financial information for historic Phoenix activity that you could use as a base. But initially, we would expect the results of Phoenix that were disclosed in the Phoenix announcement, so basically we added to C.H. Robinson initially. I think we're going to experience some revenue synergies and things going forward. And there may be some operating cost synergies going forward, but in the initial period, much of that potential will be absorbed by some -- short-term incremental integration cost.

And our next question comes from the line of Chris Ceraso with Crédit Suisse. Christopher J. Ceraso - Crédit Suisse AG, Research Division: So just one question on the gross margins. I know you've spent some time on that. But how much of the compression that you felt is just the market and the balance in the market that you've talked about on previous calls, versus your own efforts to go out and gain share like you've talked about, and maybe the types of contracts that you've had to enter into to be able to gain share. Has that also contributed to some of the compression that you felt?

It's difficult to know precisely where that line would split. But one of the things that I guess we feel good about is that when we look at our entire book of business, the incremental freight that we've been able to get over the last year or 2, we do have fairly consistent margins across our customers and our verticals and our regions. So it's not like we have a static book of freight from the year before and then an incremental amount of freight that we don't make much money on or is at much lower margins. That margin compression comes pretty much across-the-board in all of our different services and all of our different truckload regions. So what that means to us is we feel like the real trade-off of going after that incremental market share is the personnel cost or the people that we have to add in order to do that. We don't really think it affects pricing per se in terms of how we have to price to go get that incremental market share because the market is so fragmented, we really can't control it. So when we think about going after that incremental market share and what impact there might be to our business by being more aggressive, we spoke just primarily on headcount and operating expenses as the trade-off to make sure that we're making good choices in doing that. Christopher J. Ceraso - Crédit Suisse AG, Research Division: Okay. Interesting. So the object of trying to go out and get share maybe hasn't been as big an issue on your gross margin, but it has contributed to the fact that your headcount keeps growing a lot faster than your revenue has?

Correct. That's the way we think of it.

Unfortunately, we're out of time. So that will have to be our last question. We apologize we couldn't get to everybody today. Thank you for participating in our third quarter 2012 conference call. This call will be available for replay in the Investor Relations section of the C.H. Robinson website at chrobinson.com. It will also be available by dialing (800) 406-7325 and entering the passcode 4568762#. The replay will be available at approximately 7 p.m. Eastern time today. If you have additional questions, please call me, Angie Freeman, at (952) 937-7847. Thank you.

Ladies and gentlemen, this concludes our conference for today. Thank you for your participation. You may now disconnect.