Gxo Logistics, Inc. · NYSE:GXO
Gxo Logistics — Investor Presentation (March 2023)
21 slides from Gxo Logistics's investor presentation, March 2023
Slide 1: GXO analyst roundtable
GXO analyst roundtable March 2023 ©GXO Logistics, Inc. | Confidential and Proprietary
Slide 2: Legal disclaimer
Legal disclaimer Non-GAAP Financial Measures As required by the rules of the Securities and Exchange Commission (“SEC”), we provide reconciliations of the non-GAAP financial measures contained in this presentation to the most directly comparable measure under GAAP, which are set forth in the financi
Slide 3: Business resiliency: not reflected in market perception
Business resiliency: not reflected in market perception 2023 change in consensus adjusted EBITDA1 YoY (%)2 Beta2 GXO 1.60 GXO 0% 1.40 -10% 1.20 -20% 1.00 -30% 0.80 -40% 0.60 -50% 0.40 -60% -70% 0.20 -80% 0.00 1. Refer to the ‘Non-GAAP Financial Measures’ section on slide 2 and Appendix for related i
Slide 4: Our path to 8-12% annual organic revenue growth by 2027
Our path to 8-12% annual organic revenue growth2 by 2027 Key drivers of GXO 2021-2027 organic revenue growth2 The GXO Outsourced warehousing market tailwinds1 Difference 8-12% 2- 4% ~1% ~1% ~2% 2-4% Economic Outsourcing E-commerce Increased Scale, technology GXO demand supply chain and expertise org
Slide 5: 2027 revenue outlook: consistent growth trends
2027 revenue outlook: consistent growth trends 2019-2022 2022 2022-2027 2027 Organic growth1 Revenue Organic growth1 Revenue ~10% $9B ~10% $17B2 Clipper $569M 2022 annualised Clipper ~$400M 2023 annualised revenue impact (7-month contribution) revenue impact (5-month contribution) K+N UK $604M 2021
Slide 6: Sales process: diversified pipeline offering high visibility
Sales process: diversified pipeline offering high visibility Our strengths position us to win Driving revenue 1 $2.1B 4Q 2022 Pre-RFP: opportunity hunting 1 revenue pipeline1 2 Initial RFP: 3-5 bidders ~6-months tendering 2 process in RFPs 3 First stage: 2-3 bidders 4 Finalists: 1-2 bidders Provides
Slide 7: 4Q 2022 new contract wins underpin revenue growth
4Q 2022 new contract wins underpin revenue growth (In millions USD) 2022 revenue Expected 2023 revenue $6612 from contract wins $1,0541 from contract wins million $1,200 million $700 $1,000 $600 $500 $800 $400 $600 $300 $400 $200 $200 $100 $0 $0 Prior Q1 2021 Q2 2021 Q3 2021 Q4 2021 Q1 2022 Q2 2022
Slide 8: Sales process: multiple checks across numerous teams
Sales process: multiple checks across numerous teams Solutions Negotiation Opportunity Go/No Go Approvals THE WIN! design and pricing Team Business Legal and Operations Adaptive Solutions Financial IT Management management Technology and pricing development property Multi-team approach minimises ris
Slide 9: The GXO Difference: Our technology advantage
The GXO Difference: Our technology advantage 50% 40% 30% 20% 10% 0% Industrial & manufacturing Food & beverage Omnichannel retail & CPG Tech & consumer electronics % of revenue automated Market share1 GXO’s market share increases with automation 1. Based upon third-party research ©GXO Logistics, Inc
Slide 10: Solution design: inbound staging and storage
Solution design: inbound staging and storage 5 touch point manual processing 1. Vehicle unloading 2. Product receiving 3. Product preparation 4. Move to storage zone 5. Put away to storage Up to 3x Productivity Fewer touch points automated processing 1. Vehicle unloading 2. Product receiving 3. Prod
Slide 11: Solution design: preparation of product for picking
Solution design: preparation of product for picking 4 touch point manual processing Push the trolley 4. Put into Return the 1. Select product 2. Transport 3. Load to a trolly to storage zone fulfilment locations empty trolley Up to 3x Select product Productivity Fewer touch points automated processi
Slide 12: Solution design: picking and packing processes
Solution design: picking and packing processes 5 touch point manual processing Order received, 5. Move to order 1. Build 2. Fulfil 3. Load to 4. Remove from Instructions completion Fulfilment trolley multiple orders transfer conveyor transfer conveyor via Paper Up to 4x Productivity Fewer touch poin
Slide 13: Solution design: sortation and outbound staging
Solution design: sortation and outbound staging 5 touch point manual processing Receive from 1. Select 2. Scan 3. Create carton 4. Consolidate 5. Load pallets fulfilment an order the order and pack the items the orders to vehicle Up to 2x Productivity Fewer touch points automated processing Automate
Slide 14: 2027 adjusted EBITDA outlook: growth and efficiency
2027 adjusted EBITDA1 outlook: growth and efficiency 1,800 ~$730M ~$140M ~$30M ~$60M3 ~$45M3 ~$1.6B2 1,600 8% 1,400 Pro forma adjusted 1,200 EBITDA margin1 1,000 ~9% adjusted EBITDA margin1 800 ~$1.5B at $1.22 GBPUSD $633M1 and $1.06 EURUSD 600 400 200 0 2021 Core growth Automation and value- Adapti
Slide 15: Reiterating 2027 adjusted EBITDA guidance from January CMD
Reiterating 2027 adjusted EBITDA guidance from January CMD1 Automation & Adaptive Central Clipper cost reverse logistics technology efficiencies synergies Higher incremental margins ~$30M EBITDA uplift $60M uplift via Combine UK support on revenue growth (>9%) from retro-fit opportunities optimizati
Slide 16: Operating return on invested capital
Operating return on invested capital1 (In $millions) 2022 Adjusted EBITA 467 Cash paid for income taxes -111 Adjusted EBITA(1), net of income taxes paid 356 (In $millions) 2022 2021 Average (In $millions) 2022 2021 Average Total Assets 9,219 7,271 8,245 Accounts receivable 1,647 1,507 1,577 Less: Ca
Slide 17: Expanding into the UK, after US success
Customers include: Expanding into the UK, after US success Shared space distribution solution that gives customers omni-channel fulfillment, speed to market and access to technology and services at lower cost >30% revenue growth in 2022 and Adjusted EBITDA margins >200bps than group average1 Advanta
Slide 18: Reconciliation of GAAP Revenue to Organic Revenue
GXO Logistics, Inc. Reconciliation of GAAP Revenue to Organic Revenue (Unaudited) (In millions) Revenue Year Ended December 31, 2022 $ 8,993 Less: Revenue from acquired business (1,264) Less: Revenue from deconsolidation (20) Less: Foreign exchange impact 242 Organic revenue(1) at 2019 Foreign excha
Slide 19: Reconciliation of Net Income to Adjusted EBITDA and Adjusted EBITDA Margin
GXO Logistics, Inc. Reconciliation of Net Income to Adjusted EBITDA and Adjusted EBITDA Margin (Unaudited) Year Ended (In millions) December 31, 2021 (Pro forma)(1) Net income attributable to GXO $ 153 $ 162 Net income attributable to noncontrolling interest 8 8 Net income $ 161 $ 170 Interest expen
Slide 20: Reconciliation of Net Income to Adjusted EBITA
GXO Logistics, Inc. Reconciliation of Net Income to Adjusted EBITA (Unaudited) Year Ended December 31, (In millions) 2022 Net income attributable to GXO $ 197 Net income attributable to noncontrolling interest 3 Net income $ 200 Interest expense, net 29 Income tax expense 64 Amortization expense 68
Slide 21: ©GXO Logistics, Inc. | Confidential and Proprietary
©GXO Logistics, Inc. | Confidential and Proprietary