What changed in this filing

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Item 1. Financial Statements

2024-11-01 compared with 2024-08-02 · 222 added, 96 removed, 543 unchanged (37% of the section changed)

3 unchanged sentences

(unaudited, in thousands, except per share data)

June 30, 2024 December 31, 2023

September 30, 2024 December 31, 2023

Current assets:

4 unchanged sentences

Prepaid expenses and other 137,871 163,307

Assets held for sale 165,810 —

Total current assets 3,338,986 2,880,694

17 unchanged sentences

Current portion of debt 150,000 160,000

Liabilities held for sale 96,673 —

Total current liabilities 2,240,837 2,051,993

22 unchanged sentences

(unaudited, in thousands except per share data)

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

13 unchanged sentences

Net income 97,229 81,949 316,384 294,156

Other comprehensive loss ( 1,313 ) ( 6,536 ) ( 20,803 ) ( 4,059 )

Other comprehensive income (loss) 29,494 ( 14,891 ) 8,691 ( 18,950 )

Comprehensive income $ 126,723 $ 67,058 $ 325,075 $ 275,206

29 unchanged sentences

Balance June 30, 2024 117,262 11,726 756,135 5,691,874 ( 101,749 ) ( 4,847,545 ) 1,510,441

Net income 97,229 97,229

Foreign currency adjustments 29,494 29,494

Dividends declared, $ 0.62 per share

( 75,896 ) ( 75,896 )

Stock issued for employee benefit plans 821 82 ( 6,654 ) 63,366 56,794

Stock-based compensation expense — — 22,004 — 22,004

Balance September 30, 2024 118,083 $ 11,808 $ 771,485 $ 5,713,207 $ ( 72,255 ) $ ( 4,784,179 ) $ 1,640,066

ROBINSON WORLDWIDE, INC.

Condensed Consolidated Statements of Stockholders’ Investment (Continued)

(unaudited, in thousands, except per share data)

Outstanding Amount Additional

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Balance June 30, 2023 116,335 11,633 734,244 5,655,489 ( 92,919 ) ( 4,920,340 ) 1,388,107

Net income 81,949 81,949

Foreign currency adjustments ( 14,891 ) ( 14,891 )

Dividends declared, $ 0.61 per share

( 73,724 ) ( 73,724 )

Stock issued for employee benefit plans 130 14 ( 2,411 ) 9,873 7,476

Stock-based compensation expense — — 15,667 — 15,667

Balance September 30, 2023 116,465 $ 11,647 $ 747,500 $ 5,663,714 $ ( 107,810 ) $ ( 4,910,467 ) $ 1,404,584

See accompanying notes to the condensed consolidated financial statements.

2 unchanged sentences

(unaudited, in thousands)

Six Months Ended June 30,

Nine Months Ended September 30,

2024 2023 (1)

7 unchanged sentences

Excess tax benefit on stock-based compensation ( 5,509 ) ( 9,899 )

Loss on disposal group held for sale 48,232 21,113

Other operating activities 11,845 3,740

15 unchanged sentences

Purchases and development of software ( 39,122 ) ( 42,086 )

Proceeds from sale of property and equipment — 1,324

Net cash used for investing activities ( 59,099 ) ( 66,651 )

4 unchanged sentences

Cash dividends ( 220,256 ) ( 218,942 )

Payments on long-term borrowings ( 10,000 ) —

Proceeds from short-term borrowings 2,461,500 2,778,750

2 unchanged sentences

Effect of exchange rates on cash and cash equivalents ( 653 ) ( 6,708 )

Net change in cash and cash equivalents ( 32,358 ) ( 7,327 )

Net change in cash and cash equivalents, including cash and cash equivalents classified within assets held for sale ( 2,842 ) ( 40,263 )

net increase in cash and cash equivalents within assets held for sale ( 10,978 ) ( 2,486 )

Cash and cash equivalents, beginning of period 145,524 217,482

1 unchanged sentence

_____________________________________________________

(1) The six months ended June 30, 2023 have been adjusted to conform to current year presentation.

(1) The nine months ended September 30, 2023, have been adjusted to conform to current year presentation.

See accompanying notes to the condensed consolidated financial statements.

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Early adoption is permitted.

The Company is currently evaluating the effects adoption of this guidance will have on our consolidated financial statements.

We are currently evaluating the new disclosure requirements in this ASU and do not expect the adoption of this guidance to have a material impact on our consolidated financial statements or disclosures.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740):

11 unchanged sentences

Foreign currency translation 2,320 403 378 3,101

Balance, June 30, 2024 $ 1,186,327 $ 205,769 $ 76,509 $ 1,468,605

Balance, September 30, 2024 (1)

$ 1,191,133 $ 208,002 $ 77,566 $ 1,476,701

_________________________________________

(1) Includes $ 30.0 million of goodwill for the Europe Surface Transportation disposal group, which is presented within assets held for sale on the condensed consolidated balance sheets.

Refer to Note 14, Divestitures , for further discussion related to the sale of our Europe Surface Transportation business.

Goodwill is tested at least annually for impairment on November 30, or more frequently if events or changes in circumstances indicate that the asset might be impaired.

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As part of our 2023 annual impairment test, we determined that the fair value of our reporting units exceeded their respective carrying values and our goodwill balance was not impaired.

In the second quarter of 2024, we identified qualitative and quantitative factors indicating that the fair value of our Europe Surface Transportation reporting unit may not exceed its carrying value requiring an interim Step One Analysis.

As a result of our interim Step One Analysis, we determined that the fair value of our Europe Surface Transportation reporting unit exceeded its carrying value by less than 5 percent and its $ 29.2 million goodwill balance was not impaired.

On July 27, 2024, we entered into an agreement to sell our Europe Surface Transportation business.

The sale will include all assets and liabilities of the Europe Surface Transportation business other than its proprietary technology platform (the “disposal group”).

As a result of the planned divestiture, the Europe Surface Transportation disposal group is classified as held for sale as of September 30, 2024.

We have tested the goodwill of the Europe Surface Transportation reporting unit as of September 30, 2024, by performing an interim Step One Analysis, before measuring the fair value of the disposal group to be presented as held for sale.

We determined that the $ 30.0 million goodwill balance was not impaired.

Our interim Step One Analysis was completed using a combination of the market approach and a discounted cash flow analysis.

The market approach was completed to determine the fair value of the Europe Surface Transportation business, excluding its proprietary technology platform, and was based upon available third-party offers to acquire the business at the measurement date.

As the offers to acquire the business did not include the sale of a technology platform necessary to run the business, a discounted cash flow analysis was completed to determine the fair value of the Europe Surface Transportation proprietary technology platform.

The computed fair value of the reporting unit exceeded its carrying value by less than 5 percent and therefore the judgments, key assumptions, and third-party offers to acquire the business are inherently sensitive inputs to our interim Step One Analysis.

A negative change to the Europe Surface Transportation market could have negatively impacted the third-party offers to acquire the business used in our interim Step One Analysis although as noted in Note 14, Subsequent Events , the Company has entered into an agreement to sell the business excluding its proprietary technology platform.

A change to the timing or cash outflows needed for a market participant to implement a comparable technology platform and changes to our computed discount rate are the primary factors that could reasonably be expected to negatively affect the fair value determined by our discounted cash flow analysis.

We will continue to monitor any changes to the assumptions included in our discounted cash flow analysis in future periods as needed.

There were no changes in circumstances or events identified in the second quarter of 2024 indicating that an interim impairment analysis was required for any other reporting units as of June 30, 2024.

The market approach was completed to determine the fair value of the Europe Surface Transportation business, excluding its proprietary technology platform, and was equal to the agreed-upon sale price of the business.

As the sale does not include a technology platform necessary to run the business, a discounted cash flow analysis was completed to determine the fair value of the Europe Surface Transportation proprietary technology platform.

The computed fair value of the reporting unit exceeded its carrying value.

We will continue to monitor any changes to the assumptions included in our discounted cash flow analysis in future periods as needed although as noted in Note 14, Divestitures , the sale of the Europe Surface Transportation disposal group is expected to be completed near the end of 2024.

There were no changes in circumstances or events identified in the third quarter of 2024 indicating that an interim impairment analysis was required for any other reporting units as of September 30, 2024.

Identifiable intangible assets consisted of the following (in thousands):

June 30, 2024 December 31, 2023

September 30, 2024

December 31, 2023

Cost Accumulated Amortization Net Cost Accumulated Amortization Net

1 unchanged sentence

Customer relationships (1)

$ 80,631 $ ( 55,333 ) $ 25,298 $ 93,499 $ ( 58,437 ) $ 35,062

Indefinite-lived intangibles

1 unchanged sentence

Total intangibles (1)

$ 89,231 $ ( 55,333 ) $ 33,898 $ 102,099 $ ( 58,437 ) $ 43,662

_________________________________________

(1) Amounts as of September 30, 2024, include $ 2.9 million of net intangible assets for the Europe Surface Transportation disposal group, which is presented within assets held for sale on the condensed consolidated balance sheets.

Refer to Note 14, Divestitures , for further discussion related to the sale of our Europe Surface Transportation business.

Amortization expense for other intangible assets is as follows (in thousands):

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

Amortization expense $ 2,979 $ 5,724 $ 9,596 $ 17,312

Finite-lived intangible assets, by reportable segment, as of June 30, 2024, will be amortized over their remaining lives as follows (in thousands):

NAST Global Forwarding All Other and Corporate Total

Finite-lived intangible assets, by reportable segment, as of September 30, 2024, will be amortized over their remaining lives as follows (in thousands):

NAST Global Forwarding Total

Remainder of 2024 $ 1,964 $ 628 $ 2,592

2 unchanged sentences

2027 1,309 — 1,309

2028 — — 206 206

Total $ 22,387

5 unchanged sentences

A financial asset or liability’s classification within the hierarchy is determined based on the lowest level of input that is significant to the fair value measurement.

We had no Level 3 assets or liabilities as of and during the periods ended June 30, 2024, and December 31, 2023.

Assets and liabilities held for sale - On July 27, 2024, we entered into an agreement to sell our Europe Surface Transportation business.

The sale will include all assets and liabilities of the business other than our proprietary technology platform.

As a result of the planned divestiture the Europe Surface Transportation disposal group is classified as held for sale as of September 30, 2024.

The Company measured the disposal group at its fair value less costs incurred to sell and recorded a $ 57.0 million loss on the disposal group in the three and nine months ended September 30, 2024.

The fair value of the assets and liabilities held for sale are classified as Level 2 in the fair value hierarchy based on the negotiated sale price which is an observable market-based input.

The sale is anticipated to close near the end of 2024.

Refer to Note 14, Divestitures , for further discussion related to the sale of our Europe Surface Transportation business.

We had no other Level 2 or Level 3 assets or liabilities as of September 30, 2024, and December 31, 2023.

There were no transfers between levels during the period.

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Average interest rate as of Carrying value as of

June 30, 2024 December 31, 2023 Maturity June 30, 2024 December 31, 2023

September 30, 2024 December 31, 2023 Maturity September 30, 2024 December 31, 2023

Revolving credit facility 6.08 % 6.45 % November 2027 $ 150,000 $ 160,000

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Borrowings under the Credit Agreement generally bear interest at a variable rate determined by a pricing schedule or the base rate (which is the highest of (a) the administrative agent's prime rate, (b) the federal funds rate plus 0.50 percent, or (c) the sum of one-month SOFR plus a specified margin).

As of June 30, 2024, the variable rate equaled SOFR and a credit spread adjustment of 0.10 percent plus 1.13 percent.

As of September 30, 2024, the variable rate equaled SOFR and a credit spread adjustment of 0.10 percent plus 1.13 percent.

In addition, there is a commitment fee on the average daily undrawn stated amount under the facility ranging from 0.07 percent to 0.15 percent.

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Interest on the Notes is payable semi-annually in arrears.

The fair value of the Notes approximated $ 294.1 million on June 30, 2024.

The fair value of the Notes approximated $ 295.9 million on September 30, 2024.

We estimate the fair value of the Notes primarily using an expected present value technique, which is based on observable market inputs using interest rates currently available to companies of similar credit standing for similar terms and remaining maturities and considering our own risk.

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The Receivables Securitization Facility is based on the securitization of a portion of our U.S.

trade accounts receivable with a total availability of $ 500 million as of June 30, 2024.

trade accounts receivable with a total availability of $ 500 million as of September 30, 2024.

The interest rate on borrowings under the Receivables Securitization Facility is based on SOFR plus a credit spread adjustment of 0.10 percent plus 0.80 percent.

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Taking into effect the amortization of the original issue discount and all underwriting and issuance expenses, the Senior Notes have an effective yield to maturity of approximately 4.39 percent per annum.

The fair value of the Senior Notes, excluding debt discounts and issuance costs, approximated $ 581.7 million as of June 30, 2024, based primarily on the market prices quoted from external sources.

The carrying value of the Senior Notes was $ 596.4 million as of June 30, 2024.

The fair value of the Senior Notes, excluding debt discounts and issuance costs, approximated $ 594.2 million as of September 30, 2024, based primarily on the market prices quoted from external sources.

The carrying value of the Senior Notes was $ 596.6 million as of September 30, 2024.

We may redeem the Senior Notes, in whole or in part, at any time and from time to time prior to their maturity at the applicable redemption prices described in the Senior Notes.

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In addition to the above financing agreements, we have a $ 20 million discretionary line of credit with U.S.

Bank of which $ 16.9 million is utilized for standby letters of credit related to insurance collateral as of June 30, 2024.

These standby letters of credit are renewed annually and were undrawn as of June 30, 2024.

Bank of which $ 16.9 million is utilized for standby letters of credit related to insurance collateral as of September 30, 2024.

These standby letters of credit are renewed annually and were undrawn as of September 30, 2024.

A reconciliation of the provision for income taxes using the statutory federal income tax rate to our effective income tax rate is as follows below.

The three and six months ended June 30, 2023, have been adjusted to conform to the current year presentation.

Three Months Ended June 30, Six Months Ended June 30,

The three and nine months ended September 30, 2023, have been adjusted to conform to the current year presentation.

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

5 unchanged sentences

Foreign tax rate differential ( 4.5 ) 8.4 ( 0.4 ) 2.1

Business divestitures (1)

7.9 ( 5.9 ) 2.8 ( 1.6 )

Section 162(m) limitation on compensation 1.1 1.5 1.0 1.1

1 unchanged sentence

Effective income tax rate 32.4 % 11.7 % 23.0 % 13.5 %

____________________________________________

(1) Amounts in the three and nine months ended September 30, 2024, relate to the divestiture of our Europe Surface Transportation business.

Amounts in the three and nine months ended September 30, 2023, relate to the divestiture of our Argentina operations.

Refer to Note 14, Divestitures , for further discussion related to these divestitures.

In 2021, the Organization for Economic Cooperation and Development (“OECD”) announced an Inclusive Framework on Base Erosion and Profit Shifting including Pillar Two Model Rules defining the global minimum tax, which calls for the taxation of large multinational corporations at a minimum rate of 15 percent.

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We are continuing to evaluate the impact of enacted legislation and pending legislation to enact Pillar Two Model Rules in the tax jurisdictions we operate in.

As of June 30, 2024, we have $ 21.6 million of unrecognized tax benefits and related interest and penalties.

During the third quarter of 2024, we recognized an increase to tax expense of approximately $ 11.5 million for non-deductible expenses related to the planned divestiture of our Europe Surface Transportation business.

Refer to Note 14, Divestitures for additional detail related to the divestiture of our Europe Surface Transportation business.

As of September 30, 2024, we have $ 24.2 million of unrecognized tax benefits and related interest and penalties.

It is possible the amount of unrecognized tax benefit could change in the next 12 months as a result of a lapse of the statute of limitations, new information, or settlements with taxing authorities.

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A summary of our total compensation expense recognized in our condensed consolidated statements of operations and comprehensive income for stock-based compensation is as follows (in thousands):

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

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On May 5, 2022, our shareholders approved a 2022 Equity Incentive Plan (the “Plan”) and authorized an initial 4,261,884 shares for issuance of awards thereunder.

The Plan allows us to grant certain stock awards, including stock options at fair market value, performance-based restricted stock units (“PSUs”) and shares, and time-based restricted stock units, to our key employees and non-employee directors.

Shares subject to awards under the Plan or certain of our prior plans that expire or are canceled without delivery of shares or that are settled in cash generally become available again for issuance under the Plan.

There were 2,734,585 shares available for stock awards under the Plan as of June 30, 2024.

employees and non-employee directors.

Shares subject to awards under the Plan or certain of our prior plans that expire or are canceled without delivery of shares or that are settled in cash generally may become available again for issuance under the Plan.

There were 1,679,519 shares available for stock awards under the Plan as of September 30, 2024.

Stock Options – We have awarded stock options to certain key employees that vest primarily based on their continued employment.

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These grants are being expensed based on the terms of the awards.

As of June 30, 2024, unrecognized compensation expense related to stock options was $ 2.2 million.

As of September 30, 2024, unrecognized compensation expense related to stock options was $ 1.1 million.

Stock Awards – We have awarded performance-based restricted shares, PSUs, and time-based restricted stock units.

Nearly all of our awards contain restrictions on the awardees’ ability to sell or transfer vested awards for a specified period of time.

Many of our awards contain restrictions on the awardees’ ability to sell or transfer vested awards for a specified period of time.

The fair value of these awards is established based on the market price on the date of grant, discounted for any post-vesting holding restrictions.

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These awards have been expensed on the date of grant.

As of June 30, 2024, there was unrecognized compensation expense of $ 211.1 million related to previously granted stock awards assuming maximum achievement is obtained on our PSUs.

As of September 30, 2024, there was unrecognized compensation expense of $ 194.5 million related to previously granted stock awards assuming maximum achievement is obtained on our PSUs.

The amount of future expense to be recognized will be based on the passage of time and contingent upon obtaining certain targets mentioned above over their respective performance period.

3 unchanged sentences

The following is a summary of the employee stock purchase plan activity (dollars in thousands):

Three Months Ended June 30, 2024

Three Months Ended September 30, 2024

Shares purchased

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NAST Global Forwarding All Other and Corporate Consolidated

Three Months Ended June 30, 2024

Three Months Ended September 30, 2024

Total revenues $ 2,934,617 $ 1,141,190 $ 568,834 $ 4,644,641

Income (loss) from operations (1)

148,767 88,115 ( 56,763 ) 180,119

Depreciation and amortization 4,904 2,608 16,436 23,948

3 unchanged sentences

NAST Global Forwarding All Other and Corporate Consolidated

Three Months Ended June 30, 2023

Three Months Ended September 30, 2023

Total revenues $ 3,086,970 $ 719,045 $ 535,015 $ 4,341,030

Income (loss) from operations (1)

112,121 3,491 ( 2,090 ) 113,522

Depreciation and amortization 5,882 5,446 14,216 25,544

2 unchanged sentences

Average employee headcount 6,278 5,082 4,217 15,577

____________________________________________

(1) All cash and cash equivalents are included in All Other and Corporate.

NAST Global Forwarding All Other and Corporate Consolidated

Six Months Ended June 30, 2024

Nine Months Ended September 30, 2024

Total revenues $ 8,924,839 $ 2,921,050 $ 1,694,411 $ 13,540,300

Income (loss) from operations (1)

398,764 160,649 ( 74,071 ) 485,342

Depreciation and amortization 15,779 8,245 48,856 72,880

3 unchanged sentences

NAST Global Forwarding All Other and Corporate Consolidated

Six Months Ended June 30, 2023

Nine Months Ended September 30, 2023

Total revenues $ 9,470,425 $ 2,288,890 $ 1,615,241 $ 13,374,556

Income (loss) from operations (1)

364,002 63,254 ( 20,078 ) 407,178

Depreciation and amortization 17,389 16,410 42,100 75,899

3 unchanged sentences

_________________________________________

(1) For three and nine months ended September 30, 2024, All Other and Corporate income (loss) from operations includes a $ 57.0 million loss on the planned divestiture of our Europe Surface Transportation business.

For three and nine months ended September 30, 2023, Global Forwarding income (loss) from operations includes a $ 23.6 million loss on the divestiture of our Argentina operations.

Refer to Note 14, Divestitures , for further discussion related to the sale of our Europe Surface Transportation business and Argentina operations.

(2) All cash and cash equivalents are included in All Other and Corporate.

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A summary of our total revenues disaggregated by major service line and timing of revenue recognition is presented below for each of our reportable segments (in thousands):

Three Months Ended June 30, 2024

Three Months Ended September 30, 2024

NAST Global Forwarding All Other and Corporate Total

4 unchanged sentences

Total revenues $ 2,934,617 $ 1,141,190 $ 568,834 $ 4,644,641

Three Months Ended June 30, 2023

Three Months Ended September 30, 2023

NAST Global Forwarding All Other and Corporate Total

4 unchanged sentences

Total revenues $ 3,086,970 $ 719,045 $ 535,015 $ 4,341,030

Six Months Ended June 30, 2024

Nine Months Ended September 30, 2024

NAST Global Forwarding All Other and Corporate Total

4 unchanged sentences

Total revenues $ 8,924,839 $ 2,921,050 $ 1,694,411 $ 13,540,300

Six Months Ended June 30, 2023

Nine Months Ended September 30, 2023

NAST Global Forwarding All Other and Corporate Total

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(2) Sourcing performance obligations are completed at a point in time.

We typically do not receive consideration and amounts are not due from our customers prior to the completion of our performance obligation and as such contract liabilities, as of June 30, 2024, and revenue recognized in the three and six months ended June 30, 2024, and 2023 resulting from contract liabilities, were not significant.

We typically do not receive consideration and amounts are not due from our customers prior to the completion of our performance obligation and as such contract liabilities, as of September 30, 2024, and revenue recognized in the three and nine months ended September 30, 2024, and 2023 resulting from contract liabilities, were not significant.

Contract assets and accrued expenses-transportation expense fluctuate from period to period primarily based upon changes in transportation pricing and costs and shipments in-transit at period end.

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We have lease agreements with lease components (e.g., payments for rent) and non-lease components (e.g., payments for common area maintenance and parking), which are all accounted for as a single lease component.

We do not have material lease agreements that have not yet commenced that are expected to create significant rights or obligations as of June 30, 2024.

We do not have material lease agreements that have not yet commenced that are expected to create significant rights or obligations as of September 30, 2024.

Information regarding lease expense, remaining lease term, discount rate, and other select lease information are presented below (dollars in thousands):

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

Lease Costs 2024 2023 2024 2023

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___________________________

(1) Operating lease expense for the three and six months ended June 30, 2024, includes $3.9 million of restructuring charges related to rationalization of our facilities footprint including the early termination or abandonment of select office buildings under operating leases.

(1) Operating lease expense for the three and nine months ended September 30, 2024, includes $ 0.6 million and $ 4.8 million respectively, of restructuring charges related to rationalization of our facilities footprint including the early termination or abandonment of select office buildings under operating leases.

Refer to Note 13, Restructuring , for further discussion related to our 2024 Restructuring Program.

Six Months Ended June 30,

Nine Months Ended September 30,

Other Lease Information 2024 2023

1 unchanged sentence

Right-of-use lease assets obtained in exchange for new lease liabilities 57,854 44,184

Lease Term and Discount Rate As of June 30, 2024 As of December 31, 2023

Lease Term and Discount Rate As of September 30, 2024 As of December 31, 2023

Weighted average remaining lease term (in years) 5.6 5.9

Weighted average discount rate 4.2 % 3.9 %

The maturities of lease liabilities as of June 30, 2024, were as follows (in thousands):

The maturities of lease liabilities as of September 30, 2024, were as follows (in thousands):

Maturity of Lease Liabilities Operating Leases (1)

4 unchanged sentences

Present value of lease liabilities $ 367,678

_________________________________________

(1) Includes $ 12.1 million of operating lease liabilities for the Europe Surface Transportation disposal group, which is presented within liabilities held-for-sale on the condensed consolidated balance sheets.

Refer to Note 14, Divestitures , for further discussion related to the planned sale of our Europe Surface Transportation business.

ALLOWANCE FOR CREDIT LOSSES

1 unchanged sentence

We have also considered recent trends and developments related to the current macroeconomic environment in determining our ending allowance for credit losses for both accounts receivable and contract assets.

The allowance for credit losses on contract assets was not significant as of June 30, 2024.

The allowance for credit losses on contract assets was not significant as of September 30, 2024.

A rollforward of our allowance for credit losses on our accounts receivable balance is presented below (in thousands):

2 unchanged sentences

Write-offs ( 2,211 )

Balance, June 30, 2024 $ 16,845

Recoveries of amounts previously written off were not significant for the three and six months ended June 30, 2024.

Balance, September 30, 2024 (1)

_________________________________________

(1) Includes an immaterial allowance for credit losses for the Europe Surface Transportation disposal group, which is presented within assets held for sale on the condensed consolidated balance sheets.

Refer to Note 14, Divestitures , for further discussion related to the sale of our Europe Surface Transportation business.

Recoveries of amounts previously written off were not significant for the three and nine months ended September 30, 2024.

CHANGES IN ACCUMULATED OTHER COMPREHENSIVE LOSS

Accumulated other comprehensive loss is included in Stockholders' Investment on our condensed consolidated balance sheets.

The recorded balance on June 30, 2024, and December 31, 2023, was $ 101.7 million and $ 80.9 million, respectively.

The recorded balance on June 30, 2024, and December 31, 2023, is comprised solely of foreign currency adjustments, including foreign currency translation.

Other comprehensive loss was $ 1.3 million for the three months ended June 30, 2024, primarily driven by fluctuations in the Euro, Mexican Peso and Brazilian Real mostly offset by the Australian Dollar and Singapore Dollar.

Other comprehensive loss was $ 6.5 million for the three months ended June 30, 2023, primarily driven by fluctuations in the Yuan and Singapore Dollar.

Other comprehensive loss was $ 20.8 million for the six months ended June 30, 2024, primarily driven by fluctuations in the Euro, Singapore Dollar, and Australian Dollar.

Other comprehensive loss was $ 4.1 million for the six months ended June 30, 2023, primarily driven by fluctuations in the Singapore Dollar, Yuan, and Australian Dollar partially offset by the Euro.

The recorded balance on September 30, 2024, and December 31, 2023, was $ 72.3 million and $ 80.9 million, respectively.

The recorded balance on September 30, 2024, and December 31, 2023, is comprised solely of foreign currency adjustments, including foreign currency translation.

Accumulated other comprehensive loss includes $ 2.2 million of cumulative translation loss of foreign entities to be sold with the Europe Surface Transportation disposal group which is presented as held for sale.

Refer to Note 14, Divestitures , for further discussion related to the planned sale of our Europe Surface Transportation business.

Other comprehensive income was $ 29.5 million for the three months ended September 30, 2024, primarily driven by fluctuations in the Euro, Singapore Dollar, and Australian Dollar.

Other comprehensive loss was $ 14.9 million for the three months ended September 30, 2023, primarily driven by fluctuations in the Euro and Singapore Dollar.

Other comprehensive income was $ 8.7 million for the nine months ended September 30, 2024, primarily driven by fluctuations in the Singapore Dollar and Australian Dollar.

Other comprehensive loss was $ 19.0 million for the nine months ended September 30, 2023, primarily driven by fluctuations in the Singapore Dollar, Australian Dollar, Yuan, and Euro.

RESTRUCTURING

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and 2) reprioritizing the efforts of our product and technology teams, resulting in the impairment of certain internally developed software projects.

We have realigned our product and technology

teams on fewer strategic initiatives to accelerate the capabilities of our platform to deliver market-leading outcomes for our customers, carriers, and employees.

We have realigned our product and technology teams on fewer strategic initiatives to accelerate the capabilities of our platform to deliver market-leading outcomes for our customers, carriers, and employees.

The primary initiatives of the second phase commenced in the second quarter of 2024.

These initiatives include the rationalization of our facilities footprint including the consolidation, early termination, or abandonment of office buildings under operating leases.

The 2024 Restructuring Program may also include other initiatives yet to be identified that will drive our enterprise strategy and improve our cost structure.

We expect all activities under the 2024 Restructuring program to be completed by the end of 2024.

We recognized restructuring charges of $ 15.2 million in the second quarter of 2024 primarily related to workforce reductions and charges to reduce our facilities footprint including early termination or abandonment of office buildings under operating leases.

Based upon the initiatives identified to date, we anticipate recognizing $ 30 million to $ 35 million of restructuring charges related to the 2024 Restructuring Program in 2024.

The amount of restructuring charges we recognize, and the timing of recognition, will depend upon the nature and scope of initiatives we identify and our ability to enact changes to our real estate footprint under existing operating leases.

We paid $ 10.7 million of cash related to the 2024 Restructuring Program in the six months ended June 30, 2024.

We recognized restructuring charges of $ 4.4 million in the third quarter of 2024 primarily related to workforce reductions.

We anticipate recognizing an additional $ 10 million to $ 15 million of restructuring charges primarily related to the rationalization of our facilities footprint in the fourth quarter of 2024 to complete the 2024 Restructuring Program.

The amount of restructuring charges we recognize will depend upon the nature and scope of initiatives we identify and our ability to enact changes to our real estate footprint under existing operating leases.

We paid $ 17.8 million of cash related to the 2024 Restructuring Program in the nine months ended September 30, 2024.

A summary of charges related to our 2024 Restructuring Program are presented below (in thousands):

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

Severance (1)

6 unchanged sentences

(2) Amounts are included within other selling, general, and administrative expenses in our condensed consolidated statements of operations and comprehensive income.

The charges recognized in the three months ended June 30, 2024, primarily resulted from the second phase of the 2024 Restructuring Program while the charges recognized in the six months ended June 30, 2024, also include initiatives under the first phase of the 2024 Restructuring Program as discussed above.

The following table summarizes restructuring charges by reportable segment (in thousands):

Three Months Ended June 30, 2024

The charges recognized in the three months ended September 30, 2024, primarily resulted from the second phase of the 2024 Restructuring Program while the charges recognized in the nine months ended September 30, 2024, also include initiatives under the first phase of the 2024 Restructuring Program as discussed above.

The following table summarizes restructuring charges related to our 2024 Restructuring Program by reportable segment (in thousands):

Three Months Ended September 30, 2024

NAST Global Forwarding All Other and Corporate Consolidated

1 unchanged sentence

Other selling, general, and administrative expenses 560 855 217 1,632

Six Months Ended June 30, 2024

Nine Months Ended September 30, 2024

NAST Global Forwarding All Other and Corporate Consolidated

9 unchanged sentences

( 705 ) ( 15 ) ( 720 )

Balance, June 30, 2024 $ 6,662 $ 285 $ 6,947

Balance, September 30, 2024 $ 3,457 $ — $ 3,457

________________________________

3 unchanged sentences

The initiatives under our 2022 Restructuring Program were completed in 2023.

We paid $ 3.0 million of cash related to the 2022 Restructuring Program in the six months ended June 30, 2024.

There is no further activity expected related to the 2022 Restructuring Program other than settling the remaining $ 0.7 million of accrued severance and other personnel expenses as of June 30, 2024.

We paid $ 3.3 million of cash related to the 2022 Restructuring Program in the nine months ended September 30, 2024.

There is no further activity expected related to the 2022 Restructuring Program other than settling the remaining $ 0.3 million of accrued severance and other personnel expenses as of September 30, 2024.

A summary of charges related to our 2022 Restructuring Program are presented below (in thousands):

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

Severance (1)

5 unchanged sentences

(1) Amounts are included within personnel expenses in our condensed consolidated statements of operations and comprehensive income.

Amounts recognized in the three months ended September 30, 3023, primarily relate to accrual adjustments for amounts settling for an amount different than originally estimated.

(2) Amounts are included within other selling, general, and administrative expenses in our condensed consolidated statements of operations and comprehensive income.

The following table summarizes restructuring charges by reportable segment (in thousands):

Three Months Ended June 30, 2023

The following table summarizes restructuring charges related to our 2022 Restructuring Program by reportable segment (in thousands):

Three Months Ended September 30, 2023

NAST Global Forwarding All Other and Corporate Consolidated

1 unchanged sentence

Other selling, general, and administrative expenses 4 67 122 193

Six Months Ended June 30, 2023

Nine Months Ended September 30, 2023

NAST Global Forwarding All Other and Corporate Consolidated

7 unchanged sentences

Accrual adjustments (1)

Balance, June 30, 2024 $ 652

Balance, September 30, 2024 $ 319

________________________________

(1) Accrual adjustments primarily relate to changes in estimates for certain employee termination costs, including those settling for an amount different than originally estimated and foreign currency adjustments.

SUBSEQUENT EVENTS

Subsequent to June 30, 2024, we entered into an agreement to sell our Europe Surface Transportation business.

The sale is part of our enterprise strategy to drive focus on profitable growth in our four core modes—North American truckload and LTL and global ocean and air—as engines to ignite growth and create the most value for our stakeholders.

The sale will include all assets and liabilities of the business other than our proprietary technology platform (the “disposal group”).

The sale is expected to close in the fourth quarter of 2024, subject to certain customary conditions and regulatory approvals.

The Europe Surface Transportation disposal group will be presented as held for sale beginning in the third quarter of 2024 and adjusted to fair market value, less costs to sell, which will result in a loss on sale compared to carrying value in the third quarter of 2024.

As of June 30, 2024, we had not committed to a plan to sell the business and significant uncertainty remained as to whether a sale would take place.

The carrying value of the disposal group was approximately $ 115 million as of June 30, 2024, consisting primarily of $ 75 million of net operating working capital and $ 32 million of goodwill and other intangible assets.

Europe Surface Transportation Divestiture:

In the third quarter of 2024, we entered into an agreement to sell our Europe Surface Transportation business, which is included in our All Other and Corporate segment.

The divestiture is part of our enterprise strategy to drive focus on profitable growth in our four core modes—North American truckload and LTL and global ocean and air—as engines to ignite growth and create the most value for our stakeholders.

We have determined this divestiture does not represent a strategic shift that will have a major effect on our consolidated results of operations, and therefore the results of our Europe Surface Transportation business are not reported as discontinued operations.

The sale will include all assets and liabilities of the business other than our proprietary technology platform.

The sale is expected to close near the end of 2024, subject to certain customary conditions and regulatory approvals.

As of September 30, 2024, the assets and liabilities of the Europe Surface Transportation disposal group are presented as held for sale at fair value less any direct costs incurred to sell as of September 30, 2024.

We recognized a $ 48.2 million loss on the disposal group classified as held for sale in the three and nine months ended September 30, 2024.

Including the direct costs incurred to sell the business and the loss on the disposal group, the total loss recognized was $ 57.0 million.

These amounts are included in our All Other and Corporate segment and within other selling, general and administrative expenses in the condensed consolidated statements of operations and comprehensive income.

A summary of exit and disposal costs related to our Europe Surface Transportation divestiture is presented below (in thousands):

Three Months Ended September 30, Nine Months Ended September 30,

Other selling, general, and administrative expenses (1)

$ 57,036 $ 57,036

Income tax benefits (2)

( 2,113 ) ( 2,113 )

Total $ 54,923 $ 54,923

________________________________

(1) Amounts are included within other selling, general, and administrative expenses in our condensed consolidated statements of operations and comprehensive income and consist primarily of a $ 48.2 million loss on the disposal group and direct costs to sell.

(2) Amounts are included within provision for income taxes in our condensed consolidated statements of operations and comprehensive income.

A summary of assets and liabilities associated with the Europe Surface Transportation disposal group that are held for sale as of September 30, 2024, is presented below (in thousands):

September 30, 2024

Assets held for sale:

Cash and cash equivalents $ 10,978

Receivables 149,259

Contract assets 4,445

Prepaid expenses, and other 664

Property and equipment 3,836

Goodwill and other intangible assets 32,915

Right-of-use lease assets 11,945

Valuation allowance ( 48,232 )

Total assets held for sale (1)

Liabilities held for sale:

Accounts payable $ 71,991

Accrued transportation expense 3,901

Accrued compensation 3,861

Other accrued liabilities 4,795

Lease liabilities 12,125

Total liabilities held for sale (1)

Cumulative translation loss of foreign entities to be sold (2)

________________________________

(1) Assets and liabilities held for sale are separately presented on the condensed consolidated balance sheets.

(2) Cumulative translation loss of foreign entities to be sold is included within accumulated other comprehensive losses on the condensed consolidated balance sheets.

South American Divestiture:

In the third quarter of 2023, we announced a plan to divest our operations in Argentina to mitigate our exposure to the deteriorating economic conditions and increasing political instability there.

We identified a local independent agent to continue serving our customers in the region.

As a result of these actions, we recognized a loss primarily related to disposal and exit activities including asset impairments and workforce reductions.

The divestiture was completed near the end of 2023 for nominal consideration.

We recognized a $ 21.1 million loss on the assets and liabilities classified as held for sale in the three and nine months ended September 30, 2023, in addition to other miscellaneous costs to sell the business summarized below.

A summary of exit and disposal costs related to our South American divestiture is presented below (in thousands):

Three Months Ended September 30, Nine Months Ended September 30,

Severance and other personnel expenses (1)

$ 3,350 $ 3,350

Other selling, general, and administrative expenses (2)

21,252 21,252

Income tax benefits (3)

( 5,501 ) ( 5,501 )

Total $ 19,101 $ 19,101

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(1) Amounts are included within personnel expenses in our condensed consolidated statements of operations and comprehensive income.

(2) Amounts are included within other selling, general, and administrative expenses in our condensed consolidated statements of operations and comprehensive income and consist primarily of a $ 21.1 million loss on the disposal group.

(3) Amounts are included within provision for income taxes in our condensed consolidated statements of operations and comprehensive income.

The following table summarizes exit and disposal costs related to our South American divestiture by reportable segment (dollars in thousands):

Three Months Ended September 30, 2023

NAST Global Forwarding All Other and Corporate Consolidated

Personnel expenses $ — $ 2,600 $ 750 $ 3,350

Other selling, general, and administrative expenses — 21,012 240 21,252

Income tax benefits — ( 5,501 ) — ( 5,501 )

Nine Months Ended September 30, 2023

NAST Global Forwarding All Other and Corporate Consolidated

Personnel expenses $ — $ 2,600 $ 750 $ 3,350

Other selling, general, and administrative expenses — 21,012 240 21,252

Income tax benefits — ( 5,501 ) — ( 5,501 )

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements