940942--2/27/2006--HUB_GROUP

related topics

{customer, product, revenue}

{condition, economic, financial}

{operation, natural, condition}

{cost, regulation, environmental}

{system, service, information}

{financial, litigation, operation}

{competitive, industry, competition}

{tax, income, asset}

{personnel, key, retain}

{loss, insurance, financial}

{product, market, service}

Since our business is concentrated on intermodal marketing, any decrease in demand for intermodal transportation services compared to other transportation services could have an adverse effect on our results of operations. Because we depend on railroads for our operations, our operating results and financial condition are likely to be adversely affected by any reduction or deterioration in rail service. Because our relationships with the major railroads are critical to our ability to provide intermodal transportation services, our business may be adversely affected by any change to those relationships. Because we rely on drayage companies in our intermodal operations, our ability to expand our business or maintain our profitability may be adversely affected by a shortage of drayage capacity. Because we depend on trucking companies for our truck brokerage services, our ability to maintain or expand our truck brokerage business may be adversely affected by a shortage of trucking capacity. We depend on third parties for equipment essential to operate our business, and if we fail to secure sufficient equipment, we could lose customers and revenue. Our business could be adversely affected by strikes or work stoppages by draymen, truckers, longshoremen and railroad workers. Our results of operations are susceptible to changes in general economic conditions and cyclical fluctuations. Relatively small increases in our transportation costs that we are unable to pass through to our customers are likely to have a significant effect on our gross margin and operating income. The installation services provided by Hub Distribution are project-based and provided to only a few customers. The loss of any one of these customers or variability in the timing of these projects could significantly affect our results of operations. Our business could be adversely affected by heightened security measures, actual or threatened terrorist attacks, efforts to combat terrorism, military action against a foreign state or other similar event. If we fail to maintain and enhance our information technology systems, we may be at a competitive disadvantage and lose customers. Our information technology systems are subject to risks that we cannot control and the inability to use our information technology systems could materially adversely affect our business. The transportation industry is subject to government regulation, and regulatory changes could have a material adverse effect on our operating results or financial condition. Our operations are subject to various environmental laws and regulations, the violation of which could result in substantial fines or penalties. We derive a significant portion of our revenue from our largest customers and the loss of several of these customers could have a material adverse effect on our revenue and business. Insurance and claims expenses could significantly reduce our earnings. Our success depends upon our ability to recruit and retain key personnel. We believe that future acquisitions or dispositions that we make could significantly impact financial results. Financial results most likely to be impacted include, but are not limited to, revenue, gross margin, salaries and benefits, selling general and administrative expenses, depreciation and amortization, interest expense, net income and our debt level.

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940942--2/27/2006--HUB_GROUP_INC