You should refer to the attached interim Condensed Consolidated Financial Statements and related notes and also to our Annual Report (Form 10-K) for the year ended December 31, 2011, as you read the following discussion. We may make statements in this report that reflect our current expectation regarding future results of operations, performance and achievements. These are "forward-looking" statements as defined in the Private Securities Litigation Reform Act of 1995, and are based on our belief or interpretation of information currently available. You should realize there are many risks and uncertainties that could cause actual results to differ materially from those described. Some of the factors and events that are not within our control and could have a significant impact on future operating results are general economic conditions, cost and availability of fuel, accidents, adverse weather conditions, competitive rate fluctuations, availability of drivers, adverse legal decisions and audits or tax assessments of various federal, state or local taxing authorities. Additionally, our business is somewhat seasonal with slightly higher freight volumes typically experienced during August through early November in our full-load transportation business. You should also refer to Item 1A of our Annual Report (Form 10-K) for the year ended December 31, 2011, for additional information on risk factors and other events that are not within our control. Our future financial and operating results may fluctuate as a result of these and other risk factors as described from time to time in our filings with the SEC.

GENERAL

We are one of the largest surface transportation, delivery and logistics companies in North America. We operate four distinct, but complementary, business segments and provide a wide range of transportation and delivery services to a diverse group of customers throughout the continental United States, Canada and Mexico. We generate revenues primarily from the actual movement of freight from shippers to consignees and from serving as a logistics provider by offering or arranging for others to provide the transportation service. In addition, we offer services that generally are not provided by common truckload or intermodal carriers, including specialized equipment, on-site management, final-mile and home delivery services. Our local and home delivery services typically are provided through the use of a network of cross dock service centers throughout the continental United States. We also utilize a network of thousands of reliable third-party carriers to provide comprehensive transportation and logistics services. We account for our business on a calendar year basis with our full year ending on December 31 and our quarterly reporting periods ending on March 31, June 30 and September 30. The operation of each of our four business segments is described in Note 13, Segment Information, of our Annual Report (Form 10-K) for the year ended December 31, 2011.

Critical Accounting Policies and Estimates

The preparation of our financial statements in conformity with U.S. GAAP requires us to make estimates and assumptions that impact the amounts reported in our Condensed Consolidated Financial Statements and accompanying notes. Therefore, the reported amounts of assets, liabilities, revenues, expenses and associated disclosures of contingent liabilities are affected by these estimates. We evaluate these estimates on an ongoing basis, utilizing historical experience, consultation with experts and other methods considered reasonable in the particular circumstances. Nevertheless, actual results may differ significantly from our estimates. Any effects on our business, financial position or results of operations resulting from revisions to these estimates are recognized in the accounting period in which the facts that give rise to the revision become known.

Information regarding our Critical Accounting Policies and Estimates can be found in our Annual Report (Form 10-K). The critical accounting policies that we believe require us to make more significant judgments and estimates when we prepare our financial statements include those relating to self-insurance accruals, revenue equipment, revenue recognition and income taxes. We have discussed the development and selection of these critical accounting policies and estimates with the Audit Committee of our Board of Directors. In addition, Note 2, Summary of Significant Accounting Policies, to the financial statements in our Annual Report (Form 10-K) for the year ended December 31, 2011, contains a summary of our critical accounting policies. There have been no material changes to the methodology we apply for critical accounting estimates as previously disclosed in our Annual Report on Form 10-K.

RESULTS OF OPERATIONS

Comparison of Three Months Ended March 31, 2012 to Three Months Ended March 31,
2011

                                   Summary of Operating Segment Results
                                   For the Three Months Ended March 31,
                                               (in millions)
                               Operating Revenues          Operating Income
                               2012           2011        2012         2011
JBI                                694           577        79.4          62.6
DCS                                256           238        28.1          18.6
JBT                                128           119         4.9           5.8
ICS                                 97            75         4.1           2.6
Other (includes corporate)           -             -         0.1           0.2
   Subtotal                      1,175         1,009       116.6          89.8
Inter-segment eliminations          (9 )          (8 )         -             -

Our total consolidated operating revenues increased to $1.2 billion for the first quarter 2012, a 17% increase from $1.0 billion in the first quarter 2011. All four business segments contributed to this increase in operating revenue. Higher fuel prices resulted in fuel surcharge (FSC) revenues of $227.2 million during the current quarter, compared with $169.2 million in 2011. If FSC revenues were excluded from both periods, first quarter 2012 revenue increased 13% from 2011.

JBI segment revenue increased 20%, to $694 million during the first quarter 2012, compared with $577 million in 2011. This increase in segment revenue was primarily a result of a 16% increase in load volume over the prior year. Higher fuel prices and tighter capacity in the truck market contributed to our Eastern network growth of 28% and our transcontinental growth of 9%. Fuel surcharge recovery and a 3% increase in rates also contributed to the increase in first quarter 2012 segment revenue over the prior year. Operating income of the JBI segment increased to $79.4 million in the first quarter 2012, from $62.6 million in 2011, primarily due to increased load volume, consistent rail service, improved execution on dray movements and customer price increases.

DCS segment revenue increased 7%, to $256 million in the first quarter 2012, from $238 million in 2011. Excluding fuel surcharges, revenue increased 5%, compared to the first quarter 2011. This increase was primarily attributable to increased productivity and new accounts which provided a net additional 149 revenue producing trucks. Operating income of our DCS segment increased to $28.1 million in 2012, from $18.6 million in 2011. This increase in operating income was primarily due to the increased revenue, productivity gains and transfer of assets to more profitable accounts. Additionally, our DCS segment operating income for the first quarter of 2011 was reduced by a $1.6 million charge related to a customer bankruptcy.

JBT segment revenue totaled $128 million for the first quarter 2012, an increase of 8% from $119 million in the first quarter 2011. Excluding FSC, segment revenue increased 4%. This increase in revenue was primarily a result of increased load volumes and rates, offset by weaker spot pricing and less paid empty miles. Our JBT segment operating income decreased to $4.9 million in 2012, compared with $5.8 million during first quarter 2011. This decrease in operating income was partly due to higher fuel costs and safety expenses, increased driver and independent contractor costs, and fewer gains on equipment sales.

ICS segment revenue grew 30%, to $97 million in the first quarter 2012, from $75 million in 2011, primarily attributable to a 14% increase in load volume, higher pricing in our transactional business and an increase in the price of fuel. Operating income of our ICS segment increased to $4.1 million, from $2.6 million in 2011, due to increased revenue and improved overhead cost controls. ICS gross profit (gross revenue less purchased transportation expense) increased 26% to $13.9 million from first quarter 2011. Gross profit margin declined slightly to 14.3% in the current quarter from 14.7% in the first quarter 2011 due to increased rates paid to carriers from tighter supply and increased fuel costs.

Consolidated Operating Expenses

The following table sets forth items in our Condensed Consolidated Statements of
Earnings as a percentage of operating revenues and the percentage increase or
decrease of those items as compared with the prior period.


                                                                 Three Months Ended March 31,
                                                         Dollar Amounts as a                  Percentage Change
                                                         Percentage of Total                  of Dollar Amounts
                                                          Operating Revenues                  Between Quarters
                                                    2012                  2011                  2012 vs. 2011
Total operating revenues                           100.0 %                   100.0 %                   16.5 %
Operating expenses:
Rents and purchased transportation                  47.7                      45.3                     22.6
Salaries, wages and employee benefits               21.4                      23.2                      7.8
Fuel and fuel taxes                                 10.3                      10.9                     10.6
Depreciation and amortization                        4.8                       5.1                      9.3
Operating supplies and expenses                      3.4                       3.7                      8.6
Insurance and claims                                 1.0                       1.0                     12.2
General and administrative expenses, net of
asset dispositions                                   0.4                       0.7                    (41.9 )
Operating taxes and licenses                         0.6                       0.6                      7.4
Communication and utilities                          0.4                       0.5                     (7.7 )
Total operating expenses                            90.0                      91.0                     15.2
Operating income                                    10.0                       9.0                     29.8
Net interest expense                                 0.6                       0.9                    (17.2 )
Earnings before income taxes                         9.4                       8.1                     34.7
Income taxes                                         3.6            ­­­­­­­3.1­­­­                     34.0
Net earnings                                         5.8 %                     5.0 %                   35.1 %

Total operating expenses increased 15.2%, while operating revenues increased 16.5%, during the first quarter 2012, from the comparable period 2011. Operating income increased to $116.6 million during the first quarter 2012, from $89.8 million in 2011.

Rents and purchased transportation costs increased 22.6% in 2012. This increase was primarily the result of the increase in load volume which increased services provided by third-party rail and truck carriers, as well as higher price of fuel, since fuel costs of third-party carriers are included in purchased transportation expense.

Salaries, wages and employee benefit costs increased 7.8% in 2012 compared with 2011. This increase was primarily related to increases in driver and other labor pay due to increased business demand and a tighter supply of qualified drivers.

Fuel costs increased 10.6% in 2012, compared with 2011 due to a significant increase in the cost of fuel, as well as an increase in freight volume. It is not meaningful to compare the amount of fuel surcharge revenue or the change in fuel surcharge revenue between reporting periods to fuel and fuel taxes expense, or the change of fuel expense between periods, as a significant portion of fuel cost is included in our payments to railroads, dray carriers and other third parties. These payments are classified as purchased transportation expense.

Depreciation and amortization expense increased 9.3% in 2012 primarily due to additions to our JBI segment container and chassis fleet to support additional business demand, as well as truck and tractor growth and trades. Operating supplies and expenses increased 8.6% due to toll and tire expenses related to increased activity and increased miles. Insurance and claims expense increased 12.2% in 2012 compared with 2011, primarily due to increased cargo claims.

General and administrative expenses decreased 41.9% for the current quarter from the comparable period in 2011, primarily as a result of a decrease in bad debt expense due to a 2011 customer bankruptcy and an increase in net gains from asset sales. Net gains from sale of revenue equipment were $5.7 million in 2012, compared with $4.4 million in 2011.

Net interest expense decreased in 2012, primarily due to lower interest rates on comparable debt levels. Total debt increased to $702 million at March 31, 2012, from $698 million at March 31, 2011.

Our effective income tax rate was 38.25% for the three months ended March 31, 2012, compared with 38.45% for the three months ended March 31, 2011. In determining our quarterly provision for income taxes, we use an estimated annual effective tax rate, which is based on our expected annual income, statutory tax rates, best estimate of nontaxable and nondeductible items of income and expense and the ultimate outcome of tax audits.

Liquidity and Capital Resources

Cash Flow

Net cash provided by operating activities totaled $146 million during the first three months of 2012, compared with $137 million for the same period 2011. Operating cash flows increased primarily due to increased earnings and the timing of trade receivables collections, offset by increased prepaid expenses and the timing of accrued expenses. Net cash used in investing activities totaled $84 million in 2012, compared with $112 million in 2011. The decrease related to the timing of equipment purchases and sales. Net cash used in financing activities increased to $62 million in 2012, compared to $26 million in 2011. Financing expenditures consisted primarily of payments on outstanding debt for the first quarter of 2012, while net financing expenditures for the first quarter of 2011 were primarily for stock repurchases.

Debt and Liquidity Data
                              March 31,      December 31,    March 31,
                                 2012            2011           2011
Working capital ratio           0.9 9            1.1 7         1.1 2
Current portion of long-term
debt (millions)               $100. 0           $50. 0        $49. 0
Total debt (millions)         $702. 1          $749. 2       $698. 2
Total debt to equity            1.1 1            1.3 2         1.2 5
Total debt as a percentage
of total capital                 53 %             57 %          56 %

Liquidity

Our need for capital has typically resulted from the acquisition of intermodal containers and chassis, trucks, tractors and trailers required to support our growth and the replacement of older equipment. We are frequently able to accelerate or postpone a portion of equipment replacements depending on market conditions. We have, during the past few years, obtained capital through cash generated from operations, revolving lines of credit and long-term debt issuances. We have also periodically utilized operating leases to acquire revenue equipment.

We believe our liquid assets, cash generated from operations and revolving line of credit will provide sufficient funds for our operating and capital requirements for the foreseeable future. The following table summarizes our expected obligations and commitments as of March 31, 2012 (in millions):

                                                 One Year Or      One to Three      Four to Five      After Five
                                    Total           Less              Years             Years            Years
Operating leases                  $    19.2     $         7.3     $         8.0     $         3.5     $       0.4
Debt obligations                      702.7             100.0             300.0             302.7               0
Interest payments on debt (1)          56.5              21.9              29.3               5.3               0
Commitments to acquire revenue
equipment and facilities              260.1             260.1                 0                 0               0
   Total                          $ 1,038.5     $       389.3     $       337.3     $       311.5     $       0.4

(1) Interest payments on debt are based on the debt balance and applicable rate at March 31, 2012.

Our net capital expenditures were approximately $84 million during the first three months of 2012, compared with $112 million for the same period 2011. Our net capital expenditures include net additions to revenue equipment and non-revenue producing assets that are necessary to contribute to and support the future growth of our various business segments. Capital expenditures in 2012 were primarily for tractors, additional intermodal containers and chassis, and other trailing equipment. We are currently committed to spend approximately $260 million during the remainder of 2012, net of $6 million of expected sales proceeds from equipment dispositions. We expect to spend in the range of $370 million and $390 million for net capital expenditures during calendar year 2012. The table above excludes $21.0 million of potential liabilities for uncertain tax positions which are recorded on our Condensed Consolidated Balance Sheets. However, we are unable to reasonably estimate the ultimate timing of any settlements. Our only off-balance sheet arrangements as of March 31, 2012 were operating leases related to facility lease obligations.

Risk Factors

You should refer to Item 1A of our Annual Report (Form 10-K) for the year ended December 31, 2011, under the caption "Risk Factors" for specific details on the following factors and events that are not within our control and could affect our financial results.

· Our business is subject to general economic and business factors, any of which could have a material adverse effect on our results of operations. Economic trends and tightening of credit in financial markets could adversely affect our ability, and the ability of our suppliers, to obtain financing for operations and capital expenditures.

· We depend on third parties in the operation of our business.

· Rapid changes in fuel costs could impact our periodic financial results.

· Insurance and claims expenses could significantly reduce our earnings.

· We derive a significant portion of our revenue from a few major customers, the loss of one or more of which could have a material adverse effect on our business.

· We operate in a regulated industry, and increased direct and indirect costs of compliance with, or liability for violation of, existing or future regulations could have a material adverse effect on our business.

· Difficulty in attracting and retaining drivers, delivery personnel and third-party carriers could affect our profitability and ability to grow.

· We operate in a competitive and highly fragmented industry. Numerous factors could impair our ability to maintain our current profitability and to compete with other carriers and private fleets.

· Extreme or unusual weather conditions can disrupt our operations, impact freight volumes and increase our costs, all of which could have a material adverse effect on our business results.

· Our operations are subject to various environmental laws and regulations, the violation of which could result in substantial fines or penalties.