2007 COMPARED TO 2006

Revenues. Gross revenues for 2007 were $7.32 billion, an increase of 11.6 percent over $6.56 billion in 2006. Gross profits in 2007 were $1.24 billion, an increase of 14.9 percent over $1.08 billion in 2006. This was the result of an increase in our Transportation gross profits of 16.1 percent to $1.10 billion, an increase in our Sourcing gross profits of 6.4 percent to $100.2 million, and an increase in our Information Services gross profits of 7.5 percent to $45.5 million.

During 2007, our gross profit margin, or gross profits as a percentage of gross revenues, increased to 17.0 percent from 16.5 percent in 2006. Transportation gross profit margin increased to 18.4 percent in 2007 from 17.8 percent in 2006. Sourcing gross profit margin decreased to 7.7 percent in 2007 from 7.9 percent in 2006. Information Services is a fee-based business which generates 100 percent gross profit margin.

Transportation gross profits increased 16.1 percent to $1.10 billion in 2007 from $946.0 million in 2006. Transportation revenues are generated through several transportation services, including truck, intermodal, ocean, air, and miscellaneous services.

Truck gross profits, including LTL, increased 15.3 percent to $949.3 million in 2007. This increase was generated by volume growth of over ten percent and increased gross profit margins, partially offset by a rate decline of approximately two percent. This rate decline excludes the impact of higher fuel prices. Despite weakening demand for trucking services in the marketplace, we were able to capture additional market share and grow our volumes with existing customers and gain new customers. Our margins expanded due to more widely available capacity in the marketplace compared to 2006.

Intermodal gross profits increased 6.9 percent to $38.7 million from $36.2 million in 2006, due to an increase in volumes. Our volume growth was driven by cross-selling with existing customers and new customer growth.

Our ocean transportation gross profits increased 17.2 percent to $43.5 million in 2007. Our growth was driven by an increase in volumes and an increase in our gross profit margins. Our volumes grew due to adding new customers and growth with existing customers. Gross profit margins expanded due to more widely available capacity in the marketplace.

Our air transportation gross profits increased 45.4 percent to $31.3 million in 2007. The increase was driven by significant volume increases partially offset by a decline in our gross profit margins, due to changes in our geographic and cargo consolidation mix. Our air gross profits also included approximately $2.1 million of domestic air gross profits from our previously-disclosed acquisition of LXSI Services, Inc. on July 13, 2007.

Miscellaneous transportation gross profits consist primarily of customs brokerage fees and transportation management fees. The increase of 25.2 percent to $35.2 million in 2007 was driven by increases in transportation management business.

Sourcing gross profits increased 6.4 percent to $100.2 million in 2007, driven by growth in our volumes, partially offset by a decrease in our Sourcing gross profit margins. Our Sourcing business is the buying and selling of fresh fruits and vegetables. For several years, we have actively sought to expand our Sourcing customer base, focusing on large retailers, restaurant chains, and foodservice providers. As a result, we continue to see the long-term trend of increases in volume and gross profits in our integrated relationships with these customers, offset by a decline in our business with produce wholesale customers. Our gross profit margin declined in 2007 primarily because of higher prices for certain commodities, related to weather and higher labor and fuel costs.

Information Services is comprised entirely of revenue generated by our subsidiary, T-Chek Systems. For 2007, Information Systems gross profits growth of 7.5 percent to $45.5 million was driven primarily by volume growth in our core fuel card and cash advance services. In addition, our gross profit per transaction was up slightly due to the price of fuel. With certain merchants our fee is based on a percentage of the sale amount. Approximately 30 percent of the growth was related to other services, such as fleet card and carrier compliance services.

Selling, general, and administrative expenses. Many of our selling, general, and administrative expenses are variable in relation to gross profits. However, we did gain leverage in certain expenses.

Personnel expenses increased by 10.1 percent to $568.0 million in 2007, and decreased as a percentage of gross profits to 45.7 percent in 2007 from 47.7 percent in 2006. Personnel expenses account for nearly 80 percent of our total selling, general, and administrative expenses. Expenses related to our restricted stock program and various other incentive plans are variable, based on growth in our earnings. Our slower earnings growth in 2007 compared to 2006 resulted in a decrease in expense related to some of these incentive plans. This contributed to our personnel expenses growing slower than our gross profits.

We focus on keeping personnel expenses as variable as possible while looking for opportunities to be more efficient. Gross profits per employee increased 3.1 percent in 2007 over 2006. This increase was driven primarily by increased productivity and our slower headcount growth, relative to our gross profit growth.

Other selling, general, and administrative expenses for 2007 were $166.1 million, an increase of 11.7 percent from $148.8 million in 2006. As a percentage of gross profits, other selling, general, and administrative expenses decreased to 13.4 percent in 2007 compared to 13.7 percent in 2006. We strive to keep our expenses as variable as possible. With our revenue growth in 2007, we did gain leverage in our other selling, general, and administrative expenses.

Income from operations. Income from operations increased 22.0 percent to $509.7 million for 2007. This increase was primarily driven by the growth in our gross profits. Income from operations as a percentage of gross profits was 40.9 percent and 38.6 percent for 2007 and 2006.

Investment and other income. Investment and other income increased 16.8 percent to $13.8 million in 2007. Our portfolio yield increased slightly in 2007 from 2006.

Provision for income taxes. Our effective income tax rate was 38.1 percent for 2007 and 37.9 percent for 2006. The effective income tax rate for both periods is greater than the statutory federal income tax rate primarily due to state income taxes, net of federal benefit.

Net income. Net income increased 21.5 percent to $324.3 million for 2007. Basic net income per share increased 21.8 percent to $1.90. Diluted income per share increased 21.6 percent to $1.86 for 2007.