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Item 8. Financial Statements and Supplementary Data

2025-02-14 compared with 2024-02-16 · 298 added, 204 removed, 848 unchanged (37% of the section changed)

FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

REPORT OF IND EPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Stockholders and the Board of Directors of C.H.

75 unchanged sentences

Prepaid expenses and other 102,166 163,307

Assets held for sale 137,634 —

Total current assets

21 unchanged sentences

Current portion of debt 455,792 160,000

Liabilities held for sale 67,413 —

Total current liabilities

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Income from operations 669,141 514,607 1,266,782

Interest and other expenses ( 105,421 ) ( 100,017 ) ( 59,817 )

Interest and other income/expenses, net ( 89,937 ) ( 105,421 ) ( 100,017 )

Income before provision for income taxes 579,204 409,186 1,166,765

1 unchanged sentence

Net income 465,690 325,129 940,524

Other comprehensive income (loss) 7,914 ( 27,726 ) ( 15,136 )

Other comprehensive (loss) income ( 29,456 ) 7,914 ( 27,726 )

Comprehensive income

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1,364 136 ( 21,017 ) 92,552 71,671

Issuance of restricted stock ( 26 ) ( 3 ) 3 —

Stock-based compensation expense — — 90,677 — 90,677

3 unchanged sentences

Foreign currency adjustments

( 27,726 ) ( 27,726 )

Dividends declared, $ 2.44 per share

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Stock-based compensation expense — — 84,590 — 84,590

Repurchase of common stock ( 646 ) ( 65 ) ( 62,713 ) ( 62,778 )

Balance, December 31, 2024 118,664 $ 11,866 $ 775,054 $ 5,786,337 $ ( 110,402 ) $ ( 4,740,804 ) $ 1,722,051

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For the year ended December 31,

2023 2022 (1)

OPERATING ACTIVITIES

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Excess tax benefit on stock-based compensation ( 9,411 ) ( 11,319 ) ( 13,662 )

Loss on disposal group held for sale 17,698 — —

Loss on disposal groups held for sale 32,794 17,698 —

Other operating activities 20,682 5,541 ( 6,627 )

Changes in operating elements, net of effects of acquisitions:

Changes in operating elements:

Receivables ( 164,255 ) 607,259 923,524

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Purchases and development of software ( 51,635 ) ( 54,122 ) ( 66,582 )

Acquisitions, net of cash acquired — — ( 14,750 )

Proceeds from sale of property and equipment — 1,324 63,579

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Payments on short-term borrowings ( 3,396,500 ) ( 4,287,750 ) ( 4,646,000 )

Net cash (used for) provided by financing activities ( 717,833 ) ( 1,619,546 ) 7,573

Net cash used for financing activities ( 416,099 ) ( 717,833 ) ( 1,619,546 )

Effect of exchange rates on cash and cash equivalents ( 8,152 ) ( 3,284 ) ( 5,638 )

Net change in cash and cash equivalents

( 71,958 ) ( 39,931 ) 13,617

Net change in cash and cash equivalents, including cash and cash equivalents classified within assets held for sale 10,545 ( 71,958 ) ( 39,931 )

net increase in cash and cash equivalents within assets held for sale ( 10,307 ) — —

Cash and cash equivalents, beginning of year

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Accrued share repurchases held in other accrued liabilities — — 1,106

(1) The years ended December 31, 2022 and 2021 have been adjusted to conform to current year presentation.

See accompanying notes to the consolidated financial statements.

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USE OF ESTIMATES.

The preparation of financial statements, in conformity with accounting principles generally accepted in the U.S., requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.

The preparation of financial statements, in conformity with accounting principles generally accepted in the United States, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.

Estimates have been prepared on the basis of the most current and best information available, and our actual results could differ materially from those estimates.

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We have determined the following distinct goods and services represent our primary performance obligations.

Transportation and Logistics Services - As a global logistics provider, our primary performance obligation under our customer contracts is to utilize our relationships with a wide variety of transportation companies to efficiently and cost-effectively transport our customers’ freight.

Transportation and Logistics Services.

As a global logistics provider, our primary performance obligation under our customer contracts is to utilize our relationships with a wide variety of transportation companies to efficiently and cost-effectively transport our customers’ freight.

Revenue is recognized for these performance obligations as they are satisfied over the contract term, which generally represents the transit period.

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Pricing for our services is generally a fixed amount and is typically due within 30 days upon completion of our performance obligation, but can vary based on the nature of the service provided and certain other factors .

We also provide certain value-added logistics services, such as customs brokerage, fee-based managed services, warehousing services, small parcel, and supply chain consulting and optimization services.

We also provide certain value-added logistics services, such as customs brokerage, fee-based managed solutions, warehousing services, and supply chain consulting and optimization services.

These services may include one or more performance obligations, which are generally satisfied over the service period as we perform our obligations.

The service period may be a very short duration, in the case of customs brokerage and small parcel, or it may be longer in the case of warehousing, managed services, and supply chain consulting and optimization services.

The service period may be a very short duration, in the case of customs brokerage, or it may be longer in the case of warehousing, managed solutions, and supply chain consulting and optimization services.

Pricing for our services is established in the customer contract and is dependent upon the specific needs of the customer but may be agreed upon at a fixed fee per transaction, labor hour, or service period.

Payment is typically due within 30 days upon completion of our performance obligation, but can vary based on the nature of the service provided and certain other factors.

Sourcing Services - We contract with grocery retailers, restaurants, foodservice distributors, and produce wholesalers to provide sourcing services under the trade name Robinson Fresh ® (“Robinson Fresh”).

Sourcing Services.

We contract with grocery retailers, restaurants, foodservice distributors, and produce wholesalers to provide sourcing services under the trade name Robinson Fresh ® (“Robinson Fresh”).

Our primary service obligation under these contracts is the buying, selling, and/or marketing of produce including fresh fruits, vegetables, and other value-added perishable items.

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Total revenues represent the total dollar value of revenue recognized from contracts with customers for the goods and services we provide.

Substantially all of our revenues are attributable to contracts with our customers.

Substantially all our revenues are attributable to contracts with our customers.

Our adjusted gross profits are our total revenues less purchased transportation and related services, including contracted motor carrier, rail, ocean, air, and other costs, and the purchase price and services related to the products we source.

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business, in some cases, we take inventory risk before the specified good has been transferred to our customer.

Customs brokerage, managed services, freight forwarding, and sourcing managed procurement transactions are recorded at the net amount we charge our customers for the services we provide because many of the factors stated above are not present.

Customs brokerage, managed solutions, freight forwarding, and sourcing managed procurement transactions are recorded at the net amount we charge our customers for the services we provide because many of the factors stated above are not present.

CONTRACT ASSETS.

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We determine our allowance for expected credit losses based on our past credit loss experience, our customers’ credit risk ratings, and other customer specific and macroeconomic factors.

We compute an expected loss ratio for each credit rating pool based upon our historical write-off experience and apply it to our accounts receivable (i.e.

loss ratio approach).

We compute an expected loss ratio for each credit rating pool based upon our historical write-off experience and apply it to our accounts receivable (i.e., loss ratio approach).

This approach is then supplemented by the professional judgment of management, primarily in consideration of recent developments, write-off experience, and risk concentrations, for purposes of determining the expected credit loss allowance.

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Cash and cash equivalents consist primarily of bank deposits and highly liquid investments with an original maturity of three months or less from the time of purchase.

Cash and cash equivalents held outside the U.S.

totaled $ 142.8 million and $ 204.7 million as of December 31, 2023 and 2022, respectively.

Cash and cash equivalents held outside the United States totaled $ 134.0 million and $ 142.8 million as of December 31, 2024 and 2023, respectively.

Approximately half of our cash and cash equivalents balance is denominated in U.S.

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Net property and equipment (1)

Goodwill represents the excess of the cost of acquired businesses over the net of the fair value of identifiable tangible assets and identifiable intangible assets purchased and liabilities assumed.

$ 130,907 $ 144,718

_________________________________________

(1) Includes $ 3.7 million of net property and equipment for the Europe Surface Transportation disposal group, which is presented within assets held for sale on the condensed consolidated balance sheets as of December 31, 2024.

Refer to Note 15, Divestitures , for further discussion related to the sale of our Europe Surface Transportation business.

Goodwill represents the excess of the cost of acquired businesses over the net fair value of identifiable tangible assets and identifiable intangible assets purchased and liabilities assumed.

Goodwill is tested for impairment at the reporting unit level (operating segment or one level below an operating segment) on an annual basis (November 30 for us) and between annual tests if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying value.

1 unchanged sentence

OTHER INTANGIBLE ASSETS.

Other intangible assets include definite-lived customer lists, trademarks, non-competition agreements, and indefinite-lived trademarks.

Other intangible assets include definite-lived customer lists and indefinite-lived trademarks.

The definite-lived intangible assets are being amortized using the straight-line method over their estimated lives.

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December 31, 2024 balance (1)

$ 1,179,444 $ 202,498 $ 75,617 $ 1,457,559

_________________________________________

(1) Includes $ 28.6 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 15, 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 the asset might be impaired.

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If the Step Zero Analysis indicates it is more likely than not the fair value of our reporting units is less than their respective carrying value, an additional impairment assessment is performed (“Step One Analysis”).

As part of our 2023 annual impairment testing performed, we elected to bypass the Step Zero Analysis and perform a Step One Analysis on all of our reporting units.

There were not factors present for any reporting units, other than Europe Surface Transportation, indicating it was more likely than not the fair value of our reporting unit was less than its respective carrying value.

Consistent with our 2022 annual impairment test, certain qualitative factors were present and the performance of our Europe Surface Transportation unit indicated the fair value may not exceed its carrying value requiring a Step One Analysis.

The results of our Step One Analysis indicated the fair value of our NAST, Global Forwarding, Robinson Fresh, and Managed Services reporting units significantly exceeded their respective carrying values and the risk of goodwill impairment was remote.

The fair value of our Europe Surface Transportation reporting unit also exceeded its carrying value with greater than 30 percent cushion, and as such, the goodwill balance was not impaired.

No goodwill or intangible asset impairment has been recorded in any previous or current period presented.

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

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

As a result of the divestiture, the Europe Surface Transportation disposal group was classified as held for sale as of December 31, 2024.

We have tested the goodwill of the Europe Surface Transportation reporting unit as of December 31, 2024, by performing a Step One Analysis, before measuring the fair value of the disposal group to be presented as held for sale and determined that the $ 28.6 million goodwill balance was not impaired.

Our Europe Surface Transportation 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 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.

As noted in Note 15, Divestitures , the sale of the Europe Surface Transportation disposal group was completed with an effective date of February 1, 2025.

As part of our annual Step Zero Analysis performed in 2024 for all other reporting units, there were no factors identified suggesting that it was more likely than not that the fair value was less than their respective carrying value.

As such, a Step One Analysis was not completed for any other reporting units and no goodwill or intangible asset impairment has been recorded in any previous or current period presented.

Identifiable intangible assets consisted of the following as of December 31 (in thousands):

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Customer relationships (1)

$ 78,280 $ ( 55,984 ) $ 22,296 $ 93,499 $ ( 58,437 ) $ 35,062

Indefinite-lived intangibles

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Total intangibles (1)

Amortization expense for other intangible assets was (in thousands):

$ 86,880 $ ( 55,984 ) $ 30,896 $ 102,099 $ ( 58,437 ) $ 43,662

Finite-lived intangible assets, by reportable segment, as of December 31, 2023, will be amortized over their remaining lives as follows (in thousands):

NAST Global Forwarding All Other and Corporate Total

_________________________________________

(1) Amounts as of December 31, 2024, include $ 2.7 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 15, Divestitures , for further discussion related to the sale of our Europe Surface Transportation business.

Amortization expense for other intangible assets was (in thousands):

2024 $ 12,161

Finite-lived intangible assets, by reportable segment, as of December 31, 2024, will be amortized over their remaining lives as follows (in thousands):

NAST Global Forwarding Total

2025 $ 7,857 $ 2,210 $ 10,067

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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 December 31, 2023 or 2022.

Assets and liabilities held for sale.

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

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

As a result of the divestiture the Europe Surface Transportation disposal group was classified as held for sale as of December 31, 2024.

We measured the disposal group at its fair value less costs incurred to sell and recorded a $ 44.5 million pre-tax loss on the disposal group in twelve months ended December 31, 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 closed with an effective date of February 1, 2025.

Refer to Note 15, Divestitures , for further discussion related to the sale of our Europe Surface Transportation business.

The Company may seek to manage its exposure to the risk of fluctuations in foreign currency exchange rates through the use of foreign currency forward contracts.

Foreign currency forward contracts are accounted for at fair value with the recognition of all derivative instruments as either assets or liabilities on the balance sheet, and changes in fair value recognized in interest and other income/expenses, net in the consolidated statements of operations and comprehensive income.

These contracts are accounted for as non-designated hedges pursuant to ASC Topic 815, “ Derivatives and Hedging.

” Foreign currency forward contracts are classified under Level 2 of the fair value hierarchy and are measured using market-based rates.

The impact of foreign currency forward contracts were not material as of and for the twelve months ended December 31, 2024.

We had no other Level 2 or Level 3 assets or liabilities as of and during the periods ended December 31, 2024 or 2023.

There were no transfers between levels during the period.

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Revolving Credit Facility 5.58 % 6.45 % November 2027 $ 9,000 $ 160,000

364-day revolving credit facility — % 5.12 % May 2023 — 379,000

Senior Notes, Series A — % 3.97 % August 2023 — 175,000

Senior Notes, Series B 4.26 % 4.26 % August 2028 150,000 150,000

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SENIOR UNSECURED REVOLVING CREDIT FACILITY

We have a senior unsecured revolving credit facility (the “Credit Agreement”) with a total availability of $ 1 billion and a maturity date of November 19, 2027.

We have a senior unsecured revolving credit facility (the “Credit Agreement”) with a total availability of $ 1 billion, which may be reduced by standby letters of credit.

The Credit Agreement has a maturity date of November 19, 2027.

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).

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The Credit Agreement also contains customary events of default.

364-DAY UNSECURED REVOLVING CREDIT FACILITY

On May 6, 2022, we entered into an unsecured revolving credit facility (the “364-day Credit Agreement”) with a total availability of $ 500 million and a maturity date of May 5, 2023.

The interest rate on borrowings under the 364-day Credit Agreement was based on an alternate base rate plus a margin or term SOFR-based rate plus a margin.

There was also a commitment fee on the aggregate unused commitments under the facility.

The facility expired on May 5, 2023, and it was not renewed.

NOTE PURCHASE AGREEMENT

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The occurrence of an event of default would permit certain Purchasers to declare certain Notes then outstanding to be immediately due and payable.

Under the terms of the Note

Purchase Agreement, the Notes are redeemable, in whole or in part, at 100 percent of the principal amount being redeemed together with a “make-whole amount” (as defined in the Note Purchase Agreement), and accrued and unpaid interest with respect to each Note.

Under the terms of the Note Purchase Agreement, the Notes are redeemable, in whole or in part, at 100 percent of the principal amount being redeemed together with a “make-whole amount” (as defined in the Note Purchase Agreement), and accrued and unpaid interest with respect to each Note.

The obligations of the company under the Note Purchase Agreement and the Notes are guaranteed by C.H.

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to provide a receivables securitization facility (the “Receivables Securitization Facility”).

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

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 December 31, 2024.

The interest rate on borrowings under the Receivables Securitization Facility is based on SOFR plus a margin.

There is also a commitment fee we are required to pay on any unused portion of the facility.

The recorded amount of borrowings outstanding on the Receivables Securitization Facility approximates fair value because it can be redeemed on short notice and the interest rate floats.

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.

In addition, there is a commitment fee on the average daily undrawn stated amount under the facility of 0.20 percent.

The recorded amount of borrowings outstanding under the Receivables Securitization Facility approximates fair value because it can be redeemed on short notice and the interest rate floats.

We consider these borrowings to be a Level 2 financial liability.

Borrowings on the Receivables Securitization Facility, if any, are included within proceeds on current borrowings on the consolidated statement of cash flows.

The Receivables Securitization Facility contains various customary affirmative and negative covenants, and it also contains customary default and termination provisions, which provide for acceleration of amounts owed under the Receivables Securitization Facility upon the occurrence of certain specified events.

On February 1, 2022, we amended the Receivables Securitization Facility primarily to increase the total availability from $ 300 million to $ 500 million pursuant to the provisions of the existing agreement.

On July 7, 2022, we amended the Receivables Securitization Facility to effectively increase the receivables pool available with respect to the Receivables Securitization Facility.

On November 7, 2023, we amended the Receivables Securitization Facility to extend the termination date of the facility to November 7, 2025.

The total available remains $ 500 million, and we have the option to utilize an accordion feature, if needed, of an additional $ 250 million pursuant to the provisions of the Receivables Purchase Agreement, as amended by the Receivables Purchase Agreement Amendment.

As of December 31, 2023, the variable rate equaled SOFR and a Credit Spread Adjustment of 0.10 percent plus 0.80 percent.

In addition, there is a commitment fee on the average daily undrawn stated amount under the facility of 0.20 percent.

On April 9, 2018, we issued senior unsecured notes (“Senior Notes”) through a public offering.

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The carrying value of the Senior Notes was $ 596.9 million as of December 31, 2024.

If the Senior Notes were measured at fair value in the financial statements, they would be classified as Level 2 in the fair value hierarchy.

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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If an event of default occurs and is continuing with respect to the Senior Notes, the trustee or holders of at least 25 percent in principal amount outstanding of the Senior Notes may declare the principal and the accrued and unpaid interest, if any, on all of the outstanding Senior Notes to be due and payable.

These covenants and events of default are subject to a number of important qualifications, limitations, and exceptions that are

described in the indenture.

These covenants and events of default are subject to a number of important qualifications, limitations, and exceptions that are described in the indenture.

The indenture does not contain any financial ratios or specified levels of net worth or liquidity to which we must adhere.

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These standby letters of credit are renewed annually and were undrawn as of December 31, 2024.

Robinson Worldwide, Inc.

and its 80 percent (or more) owned U.S.

Robinson Worldwide, Inc., and its 80 percent (or more) owned U.S.

subsidiaries file a consolidated federal income tax return.

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income tax returns before 2020.

In 2023, we came to an agreement with IRS Independent Office of Appeals on a tax position related to Section 199 for the tax years of 2014 through 2017.

The Section 199 domestic production activities deduction was eliminated from the tax code as part of the Tax Cuts and Jobs Act in 2017, effective for tax years starting in 2018.

Although we maintain our position was appropriate and supportable, we determined it was in our best interest to settle the issue when factoring in litigation costs.

Therefore, we have recognized $ 19.2 million of additional tax expense in 2023, in excess of the existing tax reserve including the impacts of interest, related to the settlement of the matter.

In 2023, management made the determination that the company is no longer indefinitely reinvested with regard to the unremitted earnings of any foreign subsidiaries.

The change resulted in a one-time increase to tax expense of approximately $ 2.0 million in the year ended December 31, 2023.

The company is no longer indefinitely reinvested with regard to the unremitted earnings of any foreign subsidiaries.

The company remains indefinitely reinvested related to other taxable differences that may exist with regard to these subsidiaries.

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tax jurisdictions have either recently enacted legislation to adopt certain components of the Pillar Two Model Rules beginning in 2024 (including the European Union Member States) with the adoption of additional components in later years or announced their plans to enact legislation in future years.

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.

We are subject to these rules in certain jurisdictions in which we operate, and any expected tax impacts have been included in our results.

As rules for more jurisdictions will become effective in 2025, we will continue to evaluate the impact of enacted and pending legislation to Pillar Two Model Rules in the tax jurisdictions we operate in.

Income before provision for income taxes consisted of (in thousands):

Twelve Months Ended December 31,

2024 2023 2022

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A reconciliation of the beginning and ending amount of unrecognized tax benefits, excluding interest and penalties, is as follows (in thousands):

As of December 31,

2024 2023 2022

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These amounts are not included in the reconciliation above.

The components of the provision for income taxes consist of the following for the years ended December 31 (in thousands):

The components of the provision for income taxes consist of the following (in thousands):

Twelve Months Ended December 31,

2024 2023 2022

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Total provision $ 113,514 $ 84,057 $ 226,241

A reconciliation of the provision for income taxes using the statutory federal income tax rate to our effective income tax rate for the years ended December 31, is as follows:

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

Twelve Months Ended December 31,

2024 2023 (1)

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Share-based payment awards ( 1.8 ) ( 2.7 ) ( 1.2 )

Excess foreign tax credits ( 9.5 ) ( 1.2 ) ( 0.4 )

Foreign tax credits 2.5 ( 9.5 ) ( 1.2 )

tax credits and incentives ( 5.3 ) ( 3.4 ) ( 2.0 )

Foreign 6.7 0.6 ( 1.2 )

Foreign tax rate differential ( 0.4 ) 5.8 0.6

Remeasurement of deferred tax balances ( 1.1 ) — —

Business divestitures (2)

Section 162(m) limitations on compensation 1.3 1.2 0.6

Other 0.2 0.4 ( 0.5 )

Effective income tax rate 19.6 % 20.5 % 19.4 %

Deferred tax assets (liabilities) are comprised of the following as of December 31 (in thousands):

________________________________

(1) The amounts as of December 31, 2023 and 2022 have been adjusted to conform to current year presentation.

(2) Amounts in 2024 relate to the divestiture of our Europe Surface Transportation business.

Amounts in 2023 relate to the divestiture of our Argentina operations.

Refer to Note 15, Divestitures , for further discussion related to these divestitures.

Deferred tax assets (liabilities) are comprised of the following (in thousands):

As of December 31,

Deferred tax assets:

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Net deferred tax assets $ 288,344 $ 201,442

________________________________

(1) The amounts as of December 31, 2022 have been adjusted to conform to current year presentation.

We had foreign net operating loss carryforwards with a tax effect of $ 69.6 million as of December 31, 2024, and $ 67.8 million as of December 31, 2023.

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Shares subject to awards granted under the plan or our prior equity incentive 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 3,598,205 shares were available for stock awards under the Plan as of December 31, 2023.

There were 1,678,776 shares available for stock awards under the Plan as of December 31, 2024.

STOCK OPTIONS.

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

The value of these awards is established by the market price on the date of the grant calculated using the Black-Scholes option pricing model.

Changes in measured stock price volatility and interest rates were the primary reasons for changes in the fair value.

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

We have awarded stock options to certain key employees that vested primarily based on their continued employment.

These awards were fully vested in 2024 and there is no remaining unrecognized compensation expense related to stock options as of December 31, 2024.

The outstanding options have expiration dates between 2025 and 2030.

Although participants can exercise options via a stock swap exercise, we do not issue reloads (restoration options) on the grants.

The following schedule summarizes stock option activity in the plans.

All outstanding unvested options as of December 31, 2023, relate to time-based grants from 2020.

Options Weighted

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Exercisable as of December 31, 2024 3,491,998 $ 79.83 3.6

As of December 31, 2023, unrecognized compensation expense related to stock options was $ 4.4 million.

The amount of future expense to be recognized will be based on the passage of time and the employees' continued employment.

There were no potentially dilutive stock options for 2023 excluded from our diluted net income per share calculations because these securities’ exercise prices were anti-dilutive (e.g., greater than the average market price of our common stock).

There were 162,347 potentially dilutive stock options for 2024 excluded from our diluted net income per share calculations because these securities’ exercise prices were anti-dilutive (e.g., greater than the average market price of our common stock).

Information on the intrinsic value of options exercised is as follows (in thousands):

2024 $ 34,519

The following table summarizes these unvested stock option grants as of December 31, 2023:

First Vesting Date Last Vesting Date Options

Granted, Net of

Forfeitures Weighted

Average Grant

Date Fair Value (1)

Unvested Options

December 31, 2020 December 31, 2024 1,626,101 13.87 315,432

________________________________

(1) Amount shown is the weighted average grant date fair value of options granted, net of forfeitures.

Determining Fair Value

We estimated the fair value of stock options granted using the Black-Scholes option pricing model.

We estimate the fair value of restricted shares and units using the Black-Scholes option pricing model-protective put method.

A description of significant assumptions used to determine the risk-free interest rate, dividend yield, expected volatility, and expected term are as follows:

Risk-Free Interest Rate -The risk-free interest rate was based on the implied yield available on U.S.

Treasury zero-coupon issues at the date of grant with a term equal to the expected term.

Dividend Yield -The dividend yield assumption is based on our history of dividend payouts.

Expected Volatility -Expected volatility was determined based on the implied volatility of traded options of our stock and the historical volatility of our stock price.

Expected Term -Expected term represents the period our stock-based awards are expected to be outstanding and was determined based on historical experience and anticipated future exercise patterns, giving consideration to the contractual terms of unexercised stock-based awards.

The grant date fair value per option was estimated using the Black-Scholes option pricing model with the following assumptions:

Weighted-average risk-free interest rate 1.6 %

Expected dividend yield 2.5 %

Weighted-average volatility 23 %

Expected term (in years) 8.91

Weighted average fair value per option $ 13.88

STOCK AWARDS.

We have awarded performance-based restricted shares, performance-based restricted stock units (“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.

Most of our awards granted prior to 2024 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 post-vesting holding restrictions.

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

On June 26, 2023, we granted 142,584 time-based restricted stock units and 91,016 PSUs at target upon the appointment of our President and Chief Executive Officer.

The time-based restricted stock units vest over a three-year period with a weighted average grant date fair value of $ 92.09 .

The PSUs vest over a three-year period based on the achievement of certain dilutive earnings per share, adjusted gross profits, and adjusted operating margin targets with a weighted average grant date fair value of $ 92.09 .

Performance-Based Awards

We have awarded performance-based restricted shares through 2020 to certain key employees.

These awards vest over a five-year period based on the company’s earnings growth.

Beginning in 2021, we have awarded annually PSUs to certain key employees.

We have awarded PSUs to certain key employees.

These PSUs vest over a three-year period based on the achievement of certain dilutive earnings per share, adjusted gross profits, and adjusted operating margin targets.

These PSUs contain an upside opportunity of up to 200 percent of target contingent upon obtaining certain targets mentioned above over their respective performance period.

The following table summarizes activity related to our performance-based restricted shares and PSUs as of December 31, 2023:

The following table summarizes activity related to our PSUs as of December 31, 2024:

Number of Restricted Shares and Restricted Stock Units Weighted Average

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364,794 73.43

Performance-based grant adjustment (2)

Vested ( 56,685 ) 76.57

Forfeitures (3)

( 242,805 ) 77.86

Unvested as of December 31, 2024 642,257 $ 83.25

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(1) Amount represents PSU grants at target.

The following table summarizes PSUs by vesting period at target:

(2) Amount represents incremental shares issuable for achievement of performance metrics above target.

(3) Includes awards forfeited for not achieving performance targets.

The following table summarizes unvested PSUs by vesting period at target:

First Vesting Date Last Vesting Date Performance Shares and Stock Units

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Time-Based Awards

We award time-based restricted stock units to certain key employees.

Time-based awards granted through 2020 vest over a five-year period.

Beginning in 2021, we have granted annually time-based awards that vest over a three-year period.

We have awarded time-based restricted stock unit awards to certain key employees.

These time-based awards vest over a three-year period.

In 2023, we also granted retention awards, which vest over a one-year to three-year period.

These awards vest primarily based on the passage of time and the employee’s continued employment and are being expensed based on the terms of the awards.

The following table summarizes our unvested time-based restricted share and restricted stock unit grants as of December 31, 2023:

The following table summarizes activity related to our time-based restricted stock unit grants as of December 31, 2024:

Number of Restricted

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However, based upon our historical experience, the resolution of these proceedings is not expected to have a material effect on our consolidated financial position, results of operations, or cash flows.

Combinex Holding B.V.

On June 3, 2021, we acquired all of the outstanding shares of Combinex Holding B.V.

(“Combinex”) to strengthen our European surface transportation presence.

Total purchase consideration, net of cash acquired was $ 14.7 million, which was paid in cash.

Identifiable intangible assets and estimated useful lives are as follows (dollars in thousands):

Estimated Life (years)

Customer relationships 7 $ 3,942

There was $ 10.8 million of goodwill recorded related to the acquisition of Combinex.

The Combinex goodwill is a result of acquiring and retaining the Combinex workforce and expected synergies from integrating its business into ours.

Purchase accounting is considered complete.

The goodwill will not be deductible for tax purposes.

The results of operations of Combinex have been included as part of the All Other and Corporate segment in our consolidated financial statements since June 3, 2021.

SEGMENT REPORTING

Our segments are based on our method of internal reporting, which generally segregates the segments by service line and the primary services they provide to our customers.

The internal reporting of segments is defined, based in part, on the reporting and review process used by our chief operating decision maker (“CODM”), our Chief Executive Officer.

The internal reporting of segments is aligned with the reporting and review process used by our chief operating decision maker (“CODM”), our Chief Executive Officer.

The accounting policies of our reportable segments are the same as those described in the summary of significant accounting policies.

We do not report our intersegment revenues by segment to our CODM and do not believe they are a meaningful metric for evaluating the performance of our reportable segments.

We identify two reportable segments as follows:

Our CODM utilizes segment operating income as the primary measure to evaluate the performance of our reportable segments.

Operating income is an important measure of our ability to optimize our cost structure through innovation of our proprietary operating systems and accelerating the capabilities of our workforce.

It also guides the allocation of resources, including employees, technology investments, and capital resource investments to each segment.

Additionally, operating income is also an important measure of our ability to maintain pricing discipline and driving profitable growth while effectively serving our customers and contract carriers.

We consider operating income to be our primary performance metric.

The review of segment performance and the allocation of resources occurs primarily in the annual budgeting process and through a regular cadence of operating reviews to monitor the progress of strategic initiatives included in our enterprise balanced scorecard.

We identify two reportable segments with all other segments included in “All Other and Corporate” as follows:

• North American Surface Transportation:

NAST provides freight transportation services across North America through a network of offices in the U.S., Canada, and Mexico.

NAST provides freight transportation services across North America through a network of offices in the United States, Canada, and Mexico.

The primary services provided by NAST are truckload and less than truckload (“LTL”) transportation services.

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• All Other and Corporate:

All Other and Corporate includes our Robinson Fresh and Managed Services segments, as well as Other Surface Transportation outside of North America and other miscellaneous revenues and unallocated corporate expenses.

All Other and Corporate includes our Robinson Fresh and Managed Solutions segments, as well as Other Surface Transportation outside of North America and other miscellaneous revenues and unallocated corporate expenses.

Robinson Fresh provides sourcing services including the buying, selling, and/or marketing of fresh fruits, vegetables, and other value-added perishable items.

Managed Services provides Transportation Management Services, or Managed TMS.

Managed Solutions provides Transportation Management Services, or Managed TMS.

Other Surface Transportation revenues are primarily earned by our Europe Surface Transportation segment.

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Reportable segment information as of, and for the years ended, December 31, 2024, 2023, and 2022, is as follows (dollars in thousands):

NAST Global Forwarding All Other and Corporate Consolidated

Twelve Months Ended December 31, 2024

Total revenues $ 12,471,075 $ 2,997,704 $ 2,127,664 $ 17,596,443

Income (loss) from operations 459,960 85,830 ( 31,183 ) 514,607

NAST Global Forwarding Total

Revenues from external customers $ 11,727,539 $ 3,805,018 $ 15,532,557

Other revenues (1)

Total consolidated revenues

Less significant segment expenses:

Purchased transportation and related services (2)

10,086,344 3,002,469

Personnel expenses (2)

669,611 371,576

Other selling, general, and administrative expenses (2)

440,292 218,497

Segment operating income 531,292 212,476 743,768

Other operating income (loss) (1)

Total consolidated operating income

Interest and other income/expenses, net

Income before provision for income taxes

Twelve Months Ended December 31, 2023

NAST Global Forwarding Total

Revenues from external customers $ 12,471,075 $ 2,997,704 $ 15,468,779

Other revenues (1)

Total consolidated revenues

Less significant segment expenses:

Purchased transportation and related services (2)

10,877,221 2,308,339

Personnel expenses (2)

662,037 366,464

Other selling, general, and administrative expenses (2)

471,857 237,071

Segment operating income 459,960 85,830 545,790

Other operating income (loss) (1)

Total consolidated operating income

Interest and other income/expenses, net

Income before provision for income taxes

Twelve Months Ended December 31, 2022

NAST Global Forwarding Total

Revenues from external customers $ 15,827,467 $ 6,812,008 $ 22,639,475

Other revenues (1)

Total consolidated revenues

Less significant segment expenses:

Purchased transportation and related services (2)

13,630,763 5,728,535

Personnel expenses (2)

844,472 414,690

Other selling, general, and administrative expenses (2)

518,930 219,419

Segment operating income 833,302 449,364 1,282,666

Other operating income (loss) (1)

Total consolidated operating income

Interest and other income/expenses, net

Income before provision for income taxes

________________________________

(1) Other revenues and operating income (loss) are attributable to our Robinson Fresh and Managed Solutions segments, as well as Other Surface Transportation outside of North America and other miscellaneous revenues and unallocated corporate expenses.

(2) The significant expense categories and amounts align with the segment-level information that is regularly provided to the CODM.

Additional segment disclosures as of, and for the years ended, December 31, 2024, 2023, and 2022, is as follows (dollars in thousands):

NAST Global Forwarding All Other and Corporate Consolidated

December 31, 2024

Depreciation and amortization $ 20,670 $ 10,602 $ 65,888 $ 97,160

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Average employee headcount 5,696 4,678 4,012 14,386

NAST Global Forwarding All Other and Corporate Consolidated

Twelve Months Ended December 31, 2022

Total revenues $ 15,827,467 $ 6,812,008 $ 2,057,150 $ 24,696,625

Income (loss) from operations 833,302 449,364 ( 15,884 ) 1,266,782

December 31, 2023

Depreciation and amortization $ 23,027 $ 19,325 $ 56,633 $ 98,985

2 unchanged sentences

Average employee headcount 6,469 5,222 4,350 16,041

NAST Global Forwarding All Other and Corporate Consolidated

Twelve Months Ended December 31, 2021

Total revenues $ 14,507,917 $ 6,729,790 $ 1,864,431 $ 23,102,138

Income (loss) from operations 585,351 510,756 ( 13,999 ) 1,082,108

December 31, 2022

Depreciation and amortization $ 23,643 $ 21,835 $ 47,298 $ 92,776

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We typically do not receive consideration and amounts are not due from our customer prior to the completion of our performance obligations and as such contract liabilities as of December 31, 2024 and 2023, and revenue recognized in the twelve months ended December 31, 2024, 2023, and 2022, resulting from contract liabilities were not significant.

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

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

Approximately 89 percent, 90 percent, and 93 percent of our total revenues for the twelve months ended December 31, 2024, 2023, and 2022, respectively, are attributable to arranging for the transportation of our customers’ freight for which we transfer control and satisfy our performance obligation over the requisite transit period.

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The transaction price for our performance obligation under these arrangements is generally fixed and readily determinable upon contract inception and is not contingent upon the occurrence or non-occurrence of another event.

Approximately seven percent, five percent, and five percent of our total revenues for the twelve months ended December 31, 2023, 2022, and 2021, respectively, are attributable to buying, selling, and/or marketing of produce including fresh fruits, vegetables, and other value-added perishable items.

Approximately eight percent, seven percent, and five percent of our total revenues for the twelve months ended December 31, 2024, 2023, and 2022, respectively, are attributable to buying, selling, and/or marketing of produce including fresh fruits, vegetables, and other value-added perishable items.

Total revenues for these transactions are recognized at a point in time upon completion of our performance obligation, which is generally when the produce is received by our customer.

Approximately three percent, two percent, and two percent of our total revenues for the twelve months ended December 31, 2023, 2022, and 2021, respectively, are attributable to value-added logistics services, such as customs brokerage, fee-based

managed services, warehousing services, small parcel, and supply chain consulting and optimization services.

Approximately three percent, three percent, and two percent of our total revenues for the twelve months ended December 31, 2024, 2023, and 2022, respectively, are attributable to value-added logistics services, such as customs brokerage, fee-based managed solutions, warehousing services, and supply chain consulting and optimization services.

Total revenues for these services are recognized over time as we complete our performance obligation.

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In addition, we do not disclose the aggregate amount of transaction price allocated to performance obligations that are unsatisfied as of the end of the period, as our contracts have an expected length of one year or less.

Finally, for certain of our performance obligations such as fee-based managed services, supply chain consulting and optimization services, and warehousing services, we have recognized revenue in the amount for which we have the right to invoice our customer as we have determined this amount corresponds directly with the value provided to the customer for our performance completed to date.

Finally, for certain of our performance obligations, such as fee-based managed solutions, supply chain consulting and optimization services, and warehousing services, we have recognized revenue in the amount for which we have the right to invoice our customer as we have determined this amount corresponds directly with the value provided to the customer for our performance completed to date.

We determine if our contractual agreements contain a lease at inception.

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A right-of-use lease asset represents our right to use an underlying asset over the term of a lease, while a lease liability represents our obligation to make lease payments arising from the lease.

Current and noncurrent lease liabilities are recognized on commencement date at the present value of lease payments, including non-lease components, which consist primarily of common area maintenance and parking charges.

Current and noncurrent lease liabilities are recognized on the commencement date at the present value of lease payments, including non-lease components, which consist primarily of common area maintenance and parking charges.

Right-of-use lease assets are also recognized on the commencement date as the total lease liability plus prepaid rents.

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We do not have material lease agreements that have not yet commenced that are expected to create significant rights or obligations as of December 31, 2024.

Information regarding lease costs, other lease information, remaining lease term, and discount rate are presented below for the twelve months ended December 31, 2023, 2022, and 2021 and as of December 31, 2023 and 2022 (dollars in thousands):

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

Twelve Months Ended December 31,

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Operating lease expense (1)

$ 108,834 $ 100,635 $ 92,032

Short-term lease expense 4,109 5,377 7,151

Total lease expense $ 112,943 $ 106,012 $ 99,183

_______________________________

(1) Operating lease expense for the twelve months ended December 31, 2024, includes $ 13.0 million 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 14, Restructuring , for further discussion related to our 2024 Restructuring Program.

Twelve Months Ended December 31,

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Present value of lease liabilities $ 374,023

_________________________________________

(1) Includes $ 10.5 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 15, Divestitures , for further discussion related to the sale of our Europe Surface Transportation business.

ALLOWANCE FOR CREDIT LOSSES

10 unchanged sentences

Balance, December 31, 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 15, 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 twelve months ended December 31, 2024.

2 unchanged sentences

The recorded balance as of December 31, 2024 and 2023, was $ 110.4 million and $ 80.9 million, respectively, and is comprised solely of foreign currency adjustments, including foreign currency translation.

Other comprehensive loss was $ 29.5 million for the twelve months ended December 31, 2024, driven primarily by fluctuations in the Singapore Dollar, Australian Dollar, and the Euro.

Other comprehensive income was $ 7.9 million for the twelve months ended December 31, 2023, driven primarily by fluctuations in the Euro and Polish Zloty.

Other comprehensive loss was $ 27.7 million for the twelve months ended December 31, 2022, driven primarily by fluctuations in the Yuan, Singapore Dollar, and Australian Dollar.

RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

Recently Adopted Accounting Standards:

For the twelve months ended December 31, 2023, there were no newly adopted accounting standards that had, or are expected to have, a material impact to our consolidated financial statements.

Recently Issued Accounting Standards:

In November 2023, the FASB issued Accounting Standard Update (“ASU”) 2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures , which expands reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses regularly provided to the CODM.

We adopted this standard in the fiscal year ended December 31, 2024, and have retrospectively updated our segment reporting disclosures accordingly in Note 8, Segment Reporting .

Recently Issued Accounting Standards:

In November 2024, the FASB issued Accounting Standard Update (“ASU”) 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40):

Disaggregation of Income Statement Expenses , which requires disclosure of disaggregated information about certain income statement expense line items in the notes to the financial statements.

The guidance in this ASU is effective for all public entities for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027.

The update may be applied either prospectively or retrospectively.

Early adoption is permitted.

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2024 Restructuring Program :

In 2022, we announced organizational changes to support our enterprise strategy of accelerating our digital transformation and productivity initiatives (the “2022 Restructuring Program”).

We continued to execute upon these digital transformation and productivity initiatives in 2023, which resulted in further restructuring charges to better align our workforce as a result of these initiatives and in consideration of the changing freight transportation market.

In 2023, we recognized additional restructuring charges of $ 17.5 million, primarily related to workforce reductions.

Our 2022 Restructuring Program was completed in 2023 other than $ 3.8 million of severance installment payments accrued as of as December 31, 2023, expected to be paid in 2024.

A summary of the restructuring charges recognized related to the 2022 Restructuring Program is presented below (in thousands):

In 2024, the Company announced a restructuring program (the “2024 Restructuring Program”) to drive our enterprise strategy and reduce our cost structure.

The 2024 Restructuring Program focused on waste reduction, reprioritizing our product and technology teams on fewer strategic initiatives, driving synergies across our portfolio of services, and unifying the go to market strategy of our divisions.

The major initiatives included 1) optimizing our management hierarchy, which includes a reduction in workforce;

2) reprioritizing the efforts of our product and technology teams to focus on fewer strategic initiatives to accelerate the capabilities of our platform to deliver market-leading outcomes for our customers, carriers, and employees;

and 3) the rationalization of our facilities footprint including the consolidation, early termination, or abandonment of office buildings under operating leases.

In 2024, we recognized restructuring charges of $ 45.7 million primarily related to workforce reductions, an impairment of internally developed software, and charges related to reducing our facilities footprint including early termination or abandonment of office buildings under operating leases.

We paid $ 21.6 million of cash related to the 2024 Restructuring Program in the twelve months ended December 31, 2024.

The initiatives included in our 2024 Restructuring Program are complete with the remaining $ 4.0 million of restructuring reserves as of December 31, 2024 expected to be paid in 2025.

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

Twelve Months Ended December 31,

Severance (1)

Other personnel expenses (1)

Other selling, general, and administrative expenses (2)

Total $ 45,733

________________________________

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

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

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

Twelve Months Ended December 31, 2024

NAST Global Forwarding All Other and Corporate Consolidated

Personnel expenses $ 10,176 $ 6,872 $ 6,809 $ 23,857

Other selling, general, and administrative expenses 6,885 4,694 10,297 21,876

The following table summarizes activity related to our 2024 Restructuring Program and reserves included in our consolidated balance sheets (in thousands):

Accrued Severance and Other Personnel Expenses Accrued Other Selling, General, and Administrative Expenses Total

Balance, December 31, 2023 $ — $ — $ —

Restructuring charges 23,857 21,876 45,733

Cash payments ( 19,213 ) ( 2,416 ) ( 21,629 )

Settled non-cash — ( 19,101 ) ( 19,101 )

Accrual adjustments (1)

( 965 ) ( 15 ) ( 980 )

Balance, December 31, 2024 $ 3,679 $ 344 $ 4,023

________________________________

(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.

2022 Restructuring Program :

In 2022, we announced organizational changes to support our enterprise strategy of accelerating our digital transformation and productivity initiatives.

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

We paid $ 3.6 million of cash related to the 2022 Restructuring Program in the twelve months ended December 31, 2024.

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

Twelve Months Ended December 31,

Severance (1)

$ 14,358 $ 18,872

Other personnel expenses (1)

3 unchanged sentences

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

(2) Amounts include impairment of certain capitalized internally developed software projects and other miscellaneous exit costs, which are included within other selling, general, and administrative expenses in our consolidated statement of operations and comprehensive income.

The following table summarizes restructuring charges by reportable segment related to the 2022 Restructuring Program for the twelve months ended December 31, 2023 and December 31, 2022 (in thousands):

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

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

Twelve Months Ended December 31, 2023 NAST Global Forwarding All Other and Corporate Consolidated

4 unchanged sentences

Other selling, general, and administrative expenses 3,175 3,174 8,801 15,150

The following table summarizes the activity related to our 2022 Restructuring Program and reserves included in our consolidated balance sheets (in thousands):

Accrued Severance and Other Personnel Expenses Other Selling, General, and Administrative Expenses Total

The following table summarizes activity related to our 2022 Restructuring Program and reserves included in our consolidated balance sheets (in thousands):

Accrued Severance and Other Personnel Expenses Accrued Other Selling, General, and Administrative Expenses Total

Balance, December 31, 2022 $ 18,976 $ — $ 18,976

5 unchanged sentences

Balance, December 31, 2023 3,783 — 3,783

Restructuring charges 12 — 12

Cash payments ( 3,605 ) — ( 3,605 )

Accrual adjustments (1)

( 190 ) — ( 190 )

Balance, December 31, 2024 $ — $ — $ —

________________________________

South American Restructuring Program:

In 2023, we announced a restructuring program (the “South American Restructuring Program”) to divest our operations in Argentina to mitigate our exposure to the deteriorating economic conditions and increasing political instability there.

The Central Bank of Argentina maintains certain currency controls that limit our ability to access U.S.

dollars in Argentina and remit cash from our Argentine operations.

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

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

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 operations in Argentina are not reported as discontinued operations.

The divestiture was completed near the end of 2023 for nominal consideration and our restructuring program is expected to be completed by the end of the first quarter of 2024.

We recognized $ 21.2 million of net restructuring charges related to our South American Restructuring Program as presented below (in thousands):

Europe Surface Transportation Divestiture:

In 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 included all assets and liabilities of the business other than our proprietary technology platform.

The sale closed effective February 1, 2025.

As of December 31, 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 December 31, 2024.

We recognized a $ 32.8 million pre-tax loss on the disposal group classified as held for sale in 2024.

Including the direct costs incurred to sell the business and the loss on the disposal group, the total pre-tax loss recognized was $ 44.5 million in 2024.

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

Twelve Months Ended December 31,

Other selling, general, and administrative expenses (1)

Income tax benefits (2)

Total $ 43,662

________________________________

(1) Amounts are included within other selling, general, and administrative expenses in our consolidated statements of operations and comprehensive income and consist primarily of a $ 32.8 million pre-tax loss on the disposal group and direct costs to sell.

(2) Amounts are included within provision for income taxes in our 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 , is presented below (in thousands):

December 31, 2024

Assets held for sale:

Cash and cash equivalents $ 10,307

Receivables 114,721

Goodwill and other intangible assets 31,297

Right-of-use lease assets 10,737

Other assets 3,366

Valuation allowance ( 32,794 )

Total assets held for sale (1)

Liabilities held for sale:

Accounts payable $ 51,388

Lease liabilities 10,540

Other liabilities 5,485

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 consolidated balance sheets.

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

South American Divestiture:

In 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 $ 22.0 million pre-tax loss on divestiture in 2023 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.

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

Twelve Months Ended December 31,

Severance and other personnel expenses (1)

Loss on disposal and exit activities including asset impairments (2)

Other selling, general, and administrative expenses (2)

Other miscellaneous expenses (3)

2 unchanged sentences

________________________________

(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.

(3) Amounts are included within interest and other expenses in our condensed consolidated statements of operations and comprehensive income.

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

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

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

(2) Amounts are included within other selling, general, and administrative expenses in our consolidated statements of operations and comprehensive income and consist primarily of a $ 17.7 million pre-tax loss on the disposal group.

(3) Amounts are included within interest and other income/expense, net in our consolidated statements of operations and comprehensive income.

(4) Amounts are included within provision for income taxes in our 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):

Twelve Months Ended December 31, 2023

NAST Global Forwarding All Other and Corporate Consolidated

Severance and other personnel expenses (1)

$ — $ 1,641 $ 596 $ 2,237

Loss on disposal and exit activities including asset impairments (2)

— 17,961 367 18,328

Personnel expenses $ — $ 1,641 $ 596 $ 2,237

Other selling, general, and administrative expenses — 17,961 367 18,328

Other miscellaneous expenses — 1,420 — 1,420

— 1,420 — 1,420

Income tax benefits — ( 795 ) — ( 795 )

— ( 795 ) — ( 795 )

________________________________

(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.

(3) Amounts are included within interest and other expenses in our condensed consolidated statements of operations and comprehensive income.

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

The following table summarizes activity related to our South American Restructuring Program and reserves included in our consolidated balance sheets (in thousands):

Accrued Severance and Other Personnel Expenses Accrued Other Selling, General, and Administrative Expenses Total

Balance, December 31, 2022 $ — $ — $ —

Restructuring charges 2,237 18,328 20,565

Cash payments ( 2,237 ) — ( 2,237 )

Divestiture of Argentine operations ( 18,328 ) ( 18,328 )

Balance, December 31, 2023 $ — $ — $ —

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

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-K

Item 8. Financial Statements and Supplementary Data