Xpo, Inc. · NYSE:XPO
Xpo — XPO Logistics — Investor Presentation (May 2020)
87 slides from Xpo's investor presentation, May 4, 2020
Slide 1: Investor Presentation May 2020
INVESTOR PRESENTATION MAY 2020 v MAY 2020 Investor Presentation
Slide 2: Disclaimers
INVESTOR PRESENTATION MAY 2020 Disclaimers 2 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, wh
Slide 3: Statement on the COVID-19 pandemic
INVESTOR PRESENTATION MAY 2020 3 Statement on the COVID - 19 pandemic XPO is widely considered to be an essential business with a responsibility to keep goods moving through supply chains. Our company and most of our facilities remain open as we continue to serve our customers. The special measures
Slide 4: Table of contents
INVESTOR PRESENTATION MAY 2020 Table of contents 4 ▪ Investor highlights ▪ Company overview ▪ Financial highlights and key metrics ▪ Business overview – North American contract logistics – European contract logistics – North American less - than - truckload – North American transportation – European
Slide 5: Investor highlights: Key factors driving growth and returns
INVESTOR PRESENTATION MAY 2020 Investor highlights: Key factors driving growth and returns 5 Leading positions in fast - growing sectors ▪ Top three industry positions across all major service lines in transportation and logistics ▪ Outsized exposure to sectors with track records of long - term grow
Slide 6: Significant addressable growth opportunities in each area of operation
INVESTOR PRESENTATION MAY 2020 Significant addressable growth opportunities in each area of operation 6 1 C ompany revenue data, excluding intersegment elimination, as of FY 2019 2 Includes only North American and European markets. Sources include Armstrong and Associates, Norbridge , Inc., EVE Part
Slide 7: Global provider of expansive capacity for customers
INVESTOR PRESENTATION MAY 2020 Global provider of expansive capacity for customers 7 GROUND TRANSPORTATION ASSETS NON - ASSET TRANSPORTATION NETWORK FACILITY ASSETS 10,000 trucks contracted via independent owner - operators 1,000,000+ brokered trucks 555 cross - docks 767 contract logistics faciliti
Slide 8: Key metrics
INVESTOR PRESENTATION MAY 2020 Key metrics 8 US 59% France 12% UK 12% Spain 5% Other 12% REVENUE BY MIX 1 Asset - Based 31% Asset - Light 69% 2019 revenue: $16.6 billion REVENUE BY GEOGRAPHY 1 1 Geographic and mix data as of FY 2019; key statistics as of March 31, 2020 CUSTOMERS Over 50,000 EMPLOYEE
Slide 9: Superior e-commerce platform for fulfillment, reverse logistics and last mile
INVESTOR PRESENTATION MAY 2020 Superior e - commerce platform for fulfillment, reverse logistics and last mile 9 Agile, technology - enabled logistics with visibility, speed and accuracy ▪ Integrated warehouse management, carrier management and reverse logistics ▪ Largest outsourced e - fulfillment
Slide 10: Potential profit growth opportunity of ~$700 million to $1 billion
INVESTOR PRESENTATION MAY 2020 Potential profit growth opportunity of ~$700 million to $1 billion 10 Six of the ten profit growth initiatives are driven by technology POOL OF COST OPPORTUNITIES Pricing benefits 20% New business initiatives 20% Cost initiatives 60% Revenue initiatives KEY INITIATIVES
Slide 11: Technology blueprint focuses on innovation in four areas
INVESTOR PRESENTATION MAY 2020 Technology blueprint focuses on innovation in four areas 11 Singular technology platform propels efficiencies for customers and company Digital freight marketplace ▪ Automated capacity management ▪ Customer self - service, multimodal flexibility Automation and intellig
Slide 12: Key applications of automation and data science in XPO operations
INVESTOR PRESENTATION MAY 2020 Key applications of automation and data science in XPO operations 12 CONTRACT LOGISTICS ▪ Proprietary technology suite manages all distribution processes and warehouse operations ▪ Provides in - house control of robotics and other automation ▪ XPO Smart™ tools improve
Slide 13: Widespread benefits of intelligent automation in logistics
INVESTOR PRESENTATION MAY 2020 Widespread benefits of intelligent automation in logistics 13 ▪ Superior visibility and control of advanced automation on proprietary platform ▪ Can perform several steps of a process by tying in multiple technologies, increasing fulfillment speed and accuracy ▪ Data t
Slide 14: XPO Connect is at the forefront of transportation automation
INVESTOR PRESENTATION MAY 2020 XPO Connect™ is at the forefront of transportation automation 14 Expands revenue and margins ▪ Automates load - tendering, pricing, bidding, buying and tracking ▪ Unlocks cross - selling opportunities across modes ▪ Penetrates tier - two and tier - three customer bases
Slide 15: Proprietary technology informs decision-making in real time
INVESTOR PRESENTATION MAY 2020 15 Proprietary technology informs decision - making in real time Forecasting Analytics Model Training Machine Learning TIME AND ATTENDANCE CLOUD APPLICATIONS IOT DATA MOBILE DEVICES AND HANDHELDS TRANSACTIONAL DATA LARGE - FORMAT DISPLAYS
Slide 16: XPO Smart drives productivity through machine learning
INVESTOR PRESENTATION MAY 2020 16 BENEFITS ▪ Proprietary XPO analytics show the future impact of contemplated management decisions in real time ▪ Business intelligence drives productivity and operational effectiveness ▪ Granular - level detail in two to three clicks CAPABILITIES ▪ Labor management a
Slide 17: Financial highlights and key metrics
INVESTOR PRESENTATION MAY 2020 Financial highlights and key metrics
Slide 18: Industry-leading growth in revenue and adjusted EBITDA
INVESTOR PRESENTATION MAY 2020 Industry - leading growth in revenue and adjusted EBITDA 18 Note: Both charts exclude the impact of the North American truckload unit divested in October 2016 Refer to the “Non - GAAP Financial Measures” section on page 2 of this document 7,533 14,188 15,381 17,279 16,
Slide 19: Strong free cash flow generation
INVESTOR PRESENTATION MAY 2020 Strong free cash flow generation 19 $ in millions XPO FREE CASH FLOW (98) 207 399 694 628 -125 0 125 250 375 500 625 750 2015 2016 2017 2018 2019 - 125 Note: 2016 and 2017 data have been recast to reflect the impact of Accounting Standards Update 2016 - 18 Refer to the
Slide 20: Operating flexibility across all economic environments
INVESTOR PRESENTATION MAY 2020 Operating flexibility across all economic environments 20 ▪ Blended model of owned, contracted and brokered capacity for truck transportation – Non - asset portion is predominantly variable - cost – Includes brokerage operations and contracted capacity with independent
Slide 21: First quarter 2020 results
INVESTOR PRESENTATION MAY 2020 First quarter 2020 results 21 REVENUE $3.86 billion NET INCOME 1 $21 million DILUTED EPS $0.20 ADJUSTED NET INCOME 1 $49 million ADJUSTED DILUTED EPS ADJUSTED EBITDA $333 million CASH FLOW FROM OPERATIONS $180 million FREE CASH FLOW $95 million $0.47 1 Net income attri
Slide 22: Balance sheet and liquidity as of March 31, 2020
INVESTOR PRESENTATION MAY 2020 Balance sheet and liquidity as of March 31, 2020 22 CASH AND CASH EQUIVALENTS $1.1 billion NET DEBT $4.9 billion NET LEVERAGE 2.95x TOTAL LIQUIDITY $1.3 billion ($2.5 billion pro forma for April debt financings) Refer to the “Non - GAAP Financial Measures” section on p
Slide 23: Full year 2019 results
INVESTOR PRESENTATION MAY 2020 Full year 2019 results 23 REVENUE $16.65 billion NET INCOME 1 $379 million DILUTED EPS $3.57 ADJUSTED NET INCOME 1 $428 million ADJUSTED DILUTED EPS ADJUSTED EBITDA $1.67 billion CASH FLOW FROM OPERATIONS $791 million FREE CASH FLOW $628 million $4.03 1 Net income attr
Slide 24: Share repurchase program
INVESTOR PRESENTATION MAY 2020 Share repurchase program 24 In the first quarter 2020, the company repurchased: SHARES PURCHASED 1.7 million shares of XPO common stock PRICE $66.58 average price per share TOTAL COST $114 million approximate total cost of repurchases ▪ XPO had approximately 91 million
Slide 25: Business overview: North American contract logistics
INVESTOR PRESENTATION MAY 2020 Business overview: North American contract logistics Americas and Asia
Slide 26: #2 logistics provider in North America, with operations in Asia and Latin America
INVESTOR PRESENTATION MAY 2020 #2 logistics provider in North America, with operations in Asia and Latin America 26 Strongly positioned with blue - chip customers who need complex solutions ▪ Expansive footprint and scale are competitive advantages ▪ Employer of choice with best - in - class ability
Slide 27: Preeminent reputation for innovation, expertise and quality of performance
INVESTOR PRESENTATION MAY 2020 Preeminent reputation for innovation, expertise and quality of performance Industry size ~$50 billion 2019 revenue $2.5 billion Countries 14 Locations 380 (North America, 314) Facility space ~ 104 million sq. ft. (North America, Asia) Employees ~21,000 Average contract
Slide 28: XPO's footprint and scale are key competitive advantages
INVESTOR PRESENTATION MAY 2020 28 1 Warehouse sq. ft. as of March 31, 2020 and includes both leased and customer square footage XPO’s footprint and scale are key competitive advantages North America 96 million sq.ft . of facility space 1 Chile Asia 8 million sq.ft . of facility space 1 COUNTRIES OF
Slide 29: Sophisticated capabilities, deeply integrated with customer supply chains
INVESTOR PRESENTATION MAY 2020 29 Sophisticated capabilities, deeply integrated with customer supply chains 29 ADVANCED AUTOMATION AND ROBOTICS INBOUND LOGISTICS AND MANUFACTURING SUPPORT REVERSE LOGISTICS AND AFTERMARKET SUPPORT WAREHOUSING ▪ Tech - enabled fulfillment continuously improved by AI,
Slide 30: XPO has decades of logistics expertise in diverse verticals in North America
INVESTOR PRESENTATION MAY 2020 XPO has decades of logistics expertise in diverse verticals in North America 30 END MARKETS % 2019 REVENUE 1 EXPERTISE CONSUMER TECHNOLOGY ▪ Direct - to - consumer and retail fulfillment of consumer electronics and other devices ▪ Returns management, OEM - certified re
Slide 31: E-commerce growth continues to drive supply chain complexity
INVESTOR PRESENTATION MAY 2020 $81 $94 $143 2017 2018 2023E US E - COMMERCE LOGISTICS MARKET SIZE GROWING VOLUMES INCREASE DEMAND FOR AUTOMATION E - commerce growth continues to drive supply chain complexity 31 CONSUMERS EXPECT FASTER DELIVERIES AND SHOP GLOBALLY $ in billions Source: Third - party
Slide 32: Special software layer enables customization
INVESTOR PRESENTATION MAY 2020 32 Special software layer enables customization Warehouse managemen t Manages all distribution processes within the warehouse walls WMx Order managemen t Centralizes customer order data, enables real - time visibility OMx Connection management Integrates customer syste
Slide 33: XPO Direct shared distribution is a game-changer for customers
INVESTOR PRESENTATION MAY 2020 XPO Direct ™ shared distribution is a game - changer for customers 33 Scale and proximity Speeds up store replenishment and home delivery; reaches 99% of population with one - day and two - day ground delivery; one tracking number end - to - end Better customer experie
Slide 34: Business overview: European contract logistics
INVESTOR PRESENTATION MAY 2020 Business overview: European contract logistics
Slide 35: Leading provider of technology-enabled, customized logistics in Europe
INVESTOR PRESENTATION MAY 2020 Leading provider of technology - enabled, customized logistics in Europe 35 #2 contract logistics provider in Europe, with the largest outsourced e - fulfillment platform ▪ Rigorous reverse logistics management is highly valued by retailers and e - tailers ▪ Strong tra
Slide 36: Best-in-class vertical expertise, advanced technology and scale
INVESTOR PRESENTATION MAY 2020 Best - in - class vertical expertise, advanced technology and scale KEY METRICS 1 36 Industry size ~ $80 billion 2019 revenue $3.6 billion Countries 15 Locations 387 Facility space ~ 98 million sq. ft. (9 million sq. m.) Employees ~34,000 Average contract length ~5 yea
Slide 37: Logistics network footprint and scale are major competitive advantages
INVESTOR PRESENTATION MAY 2020 37 XPO’s logistics network footprint and scale are major competitive advantages Europe 98 million sq. ft. (9 million sq. m.) of facility space Belgium Ireland Romania Czech Republic Italy Russia Finland Netherlands Spain France Poland Switzerland Germany Portugal Unite
Slide 38: Contract logistics and value-added services
INVESTOR PRESENTATION MAY 2020 CONTRACT LOGISTICS AND VALUE - ADDED SERVICES ▪ Inbound quality assessment and inventory inspections ▪ Tech - enabled fulfillment continuously improved by AI and machine learning ▪ Order pick, pack and customization, custom services, and pre - retailing ▪ In - demand e
Slide 39: Diversified geographical exposure with tailored business strategies
INVESTOR PRESENTATION MAY 2020 Diversified geographical exposure with tailored business strategies 39 END MARKETS % 2019 REVENUE 1 POSITIONING UK AND IRELAND ▪ #1 in e - commerce fulfillment ▪ ~262 million units picked and packed per year ▪ Capabilities for ”big and bulky” products 50 - 150 lbs. FRA
Slide 40: Serving sectors that are typically high growth, high margin or macro-resilient
INVESTOR PRESENTATION MAY 2020 Serving sectors that are typically high growth, high margin or macro - resilient 40 END MARKETS % 2019 REVENUE 1 DESCRIPTION E - COMMERCE AND RETAIL ▪ Seamless integration of large footprint: warehouses, transportation capacity, labor and advanced automation ▪ Advanced
Slide 41: Leading e-commerce and omnichannel service capabilities
INVESTOR PRESENTATION MAY 2020 SCALE AND FLEXIBILITY ▪ Largest provider of outsourced e - fulfillment services in Europe ▪ Superior ability to ramp up and manage large workforces for peak seasonality ▪ Sophisticated inventory management system optimizes lead times for customers ▪ Multichannel distri
Slide 42: Business overview: North American less-than-truckload
INVESTOR PRESENTATION MAY 2020 Business overview: North American less - than - truckload
Slide 43: LTL has a well-defined opportunity to grow EBITDA to at least $1 billion
INVESTOR PRESENTATION MAY 2020 LTL has a well - defined opportunity to grow EBITDA to at least $1 billion 43 Favorable long - term industry fundamentals ▪ Rational pricing dynamics ▪ Rapid growth of e - commerce driving retail shipments to LTL carriers One of the few US providers with national cover
Slide 44: Top three provider of less-than-truckload in North America
INVESTOR PRESENTATION MAY 2020 Top three provider of less - than - truckload (LTL) in North America 44 KEY METRICS 2 1 Source: SJ Consulting Group; data includes fuel surcharge 2 Estimate of industry size based on industry research; revenue is full year 2019; all other metrics as of March 31, 2020 I
Slide 45: LTL customers of all sizes value XPO's scale and capacity
INVESTOR PRESENTATION MAY 2020 LTL customers of all sizes value XPO’s scale and capacity 45 XPO’s network of LTL terminals in US and Canada
Slide 46: Capacity, density and scale
INVESTOR PRESENTATION MAY 2020 CAPACITY, DENSITY AND SCALE ▪ One of the largest, most modern and safest - equipped fleets in industry ▪ 8,000 tractors and 25,000 trailers 1 ▪ More than 12,000 professional drivers, operating out of 290 service centers 1 ▪ All types of commodities accepted ▪ Over 75,0
Slide 47: Technology prioritizes three areas of LTL network optimization
INVESTOR PRESENTATION MAY 2020 Technology prioritizes three areas of LTL network optimization 47 DYNAMIC ROUTE OPTIMIZATION INTELLIGENT LOAD - BUILDING ADVANCED PRICING OPTIMIZATION Technology becomes continually smarter at automating operations for best results ▪ Intelligent routing and real - time
Slide 48: XPO Smart is deployed at all LTL cross-docks in North America
INVESTOR PRESENTATION MAY 2020 XPO Smart ™ is deployed at all LTL cross - docks in North America 48 ▪ Averaging ~7% more motor moves per hour on LTL cross - docks, with high employee engagement ▪ Analytics provide deep visibility into scheduled versus active workers by role in real time ▪ Site - spe
Slide 49: Business overview: North American transportation
INVESTOR PRESENTATION MAY 2020 Business overview: North American transportation Truck brokerage / expedite Intermodal / drayage Last mile Managed transportation
Slide 50: Combination of scale, technology and service range is unique in North America
INVESTOR PRESENTATION MAY 2020 Combination of scale, technology and service range is unique in North America 50 Multimodal solutions with critical mass and leadership positions in fast - growing sectors ▪ Only provider with leading positions and real - time visibility across so many modes ▪ Customer
Slide 51: Brokerage is a vast opportunity to sell XPO's network capacity
INVESTOR PRESENTATION MAY 2020 Brokerage is a vast opportunity to sell XPO’s network capacity 51 KEY METRICS 1 Industry size 2 ~$375 billion 2019 revenue 3 $1.66 billion Locations 23 Employees ~900 Carrier relationships 38,000 Accessible trucks Over 1,000,000 1 Revenue is full year 2019; all other m
Slide 52: Demand driven by expansion of transportation outsourcing
INVESTOR PRESENTATION MAY 2020 Demand for XPO solutions driven by expansion of transportation outsourcing 52 6% 7% 7% 7% 8% 9% 10% 10% 10% 11% 11% 12% 12% 13% 14% 14% 16% 17% 19% 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 US TRUCK BROKERAGE INDUSTR
Slide 53: Scale and optionality; XPO Connect platform
INVESTOR PRESENTATION MAY 2020 SCALE AND OPTIONALITY ▪ Services include full truckload, expedite ground, expedite air charter, heavy haul, cross - border shipments, specialized services, global forwarding and managed transportation XPO CONNECT™ PLATFORM ▪ Proprietary cloud - based platform gives shi
Slide 54: Drives efficiency, volume and margin through cutting-edge connectivity
INVESTOR PRESENTATION MAY 2020 Drives efficiency, volume and margin through cutting - edge connectivity 54 CUSTOMERS CARRIERS DRIVE XPO™ APP CARRIER INTERFACE CARRIER MOBILE INTERFACE REAL - TIME TRACKING ENGINE CUSTOMER INTERFACE CUSTOMER MOBILE INTERFACE ROUTE OPTIMIZATION FREIGHT OPTIMIZATION CON
Slide 55: Rapid traction of XPO Connect propelled by carrier adoption
INVESTOR PRESENTATION MAY 2020 55 FULLY MOBILIZES THE PROCUREMENT PROCESS Preview XPO’s freight opportunities using the guest access feature and sign up to start booking DRIVER ENGAGEMENT AND RECRUITMENT Search for available loads, place bids and immediately purchase loads to keep moving LOAD BOOKIN
Slide 56: Third largest intermodal provider in North America
INVESTOR PRESENTATION MAY 2020 Third largest intermodal provider in North America 56 Industry size ~$43 billion 2019 revenue $948 million Locations 37 terminals Employees ~ 400 53 - ft. containers, chassis ~10,000, 5,000 Drayage trucks under contract Over 25,000 KEY METRICS 1 ▪ 30 - year relationshi
Slide 57: Unique competitive advantages differentiate XPO's intermodal offering
INVESTOR PRESENTATION MAY 2020 Unique competitive advantages differentiate XPO’s intermodal offering 57 ▪ Proprietary intermodal system tracks door - to - door movements of long - haul freight with GPS on containers ▪ Communicates constantly with railroads to proactively identify any delays ▪ Monito
Slide 58: Largest provider of last mile logistics for heavy goods in North America
INVESTOR PRESENTATION MAY 2020 Largest provider of last mile logistics for heavy goods in North America 58 Industry size ~$13 billion 2019 revenue $873 million Hub locations 85 Employees ~2,000 Carriers / trucks ~1,500 / ~3,600 Annual deliveries Over 10 million ▪ Fully integrated, national platform
Slide 59: Growth in e-commerce orders for large items benefits last mile service
INVESTOR PRESENTATION MAY 2020 Growth in e - commerce orders for large items benefits XPO’s last mile service 59 132 136 159 187 218 250 287 331 380 439 508 582 660 743 828 915 1,006 2008A 2009A 2010A 2011A 2012A 2013A 2014A 2015A 2016A 2017A 2018A 2019E 2020E 2021E 2022E 2023E 2024E E - COMMERCE SA
Slide 60: Unmatched combination of last mile scale, technology and experience
INVESTOR PRESENTATION MAY 2020 Unmatched combination of last mile scale, technology and experience 60 ▪ Long - term relationships with best - in - class contract carriers ▪ Post - delivery feedback loops resolve issues quickly and protect brand loyalty ▪ Industry - best consumer satisfaction levels
Slide 61: Top five global provider of managed transportation
INVESTOR PRESENTATION MAY 2020 Top five global provider of managed transportation 61 ▪ Integrated with XPO Connect™, industry - leading multimodal technology platform ▪ Rigorous tracking and visibility; worry - free set - up; disaster recovery capabilities ▪ Technology tools collect big data and tur
Slide 62: Business overview: European transportation
INVESTOR PRESENTATION MAY 2020 Business overview: European transportation Truck brokerage Dedicated truckload Less - than - truckload Managed transportation Last mile
Slide 63: Leading positions in fast-growing sectors
INVESTOR PRESENTATION MAY 2020 Leading positions in fast - growing sectors 63 Expansive platform with strong positions across Europe ▪ #1 transportation company by size across UK, France, Spain, Portugal and Morocco ▪ Mix of asset - based and non - asset over - the - road capacity optimized for each
Slide 64: Leading provider of truck brokerage and LTL transportation in Europe
INVESTOR PRESENTATION MAY 2020 Leading provider of truck brokerage and LTL transportation in Europe 64 ▪ Leading provider of truck brokerage in Europe ▪ Leading less - than - truckload (LTL) provider in the UK, France, Spain and Portugal, with daily service to 30 countries ▪ Dedicated truckload offe
Slide 65: Tailored growth strategies for XPO's largest markets
INVESTOR PRESENTATION MAY 2020 TAILORED GROWTH STRATEGIES FOR XPO’S LARGEST MARKETS BY % OF REVENUE 1 XPO’s transportation network covers over 90% of Europe’s GDP 65 FRANCE UNITED KINGDOM AND IRELAND SPAIN AND PORTUGAL 26% 17% 46% ▪ Blended model of XPO - owned trucks and contracted independent carr
Slide 66: Strong positioning in highly fragmented transportation marketplaces
INVESTOR PRESENTATION MAY 2020 FRANCE ▪ #1 in less - than - truckload ▪ Top three provider of truck brokerage ▪ #1 provider of dry van truckload ▪ Only LTL provider fully authorized to handle hazardous goods ▪ Differentiated intermodal offerings, such as road transportation + river barge UNITED KING
Slide 67: LTL locations serving countries across Europe
INVESTOR PRESENTATION MAY 2020 Over 100 LTL locations serving countries across Europe 67 International Hub XPO International Hub Partner Platform XPO Platform Partner ▪ Transportation capabilities from a single pallet to full truckload ▪ ~60,000 pallets delivered daily over domestic networks ▪ ~9,80
Slide 68: Numerous levers to grow revenue and expand margin in Europe
INVESTOR PRESENTATION MAY 2020 Numerous levers to grow revenue and expand margin in Europe EXPAND EXISTING PLATFORM COLLABORATE ACROSS NETWORK CONTINUE TO BUILD TECHNOLOGY ADVANTAGE EXECUTE PRICING INITIATIVES ▪ Take advantage of fragmented industry to drive outsized growth ▪ Increase scale in last
Slide 69: Investor highlights: Key factors driving growth and returns
INVESTOR PRESENTATION MAY 2020 Investor highlights: Key factors driving growth and returns 69 Leading positions in fast - growing sectors ▪ Top three industry positions across all major service lines in transportation and logistics ▪ Outsized exposure to sectors with track records of long - term gro
Slide 70: Supplemental materials
INVESTOR PRESENTATION MAY 2020 Supplemental materials
Slide 71: XPO is widely recognized for performance and culture
INVESTOR PRESENTATION MAY 2020 XPO is widely recognized for performance and culture 71 ▪ Named one of the World’s Most Admired Companies by Fortune, 2018, 2019, 2020 ▪ Named one of Spain’s Best Companies to Work For by Forbes, 2019, 2020 ▪ Ranked in top 100 of America's Most Responsible Companies by
Slide 72: Highlights of XPO's people-first culture in 2019
INVESTOR PRESENTATION MAY 2020 Highlights of XPO’s people - first culture in 2019 72 ▪ Launched a partnership with a leading healthcare network for women and families to offer supplemental health services from over 1,400 practitioners in 20 specialties through a virtual clinic ▪ Achieved a Recordabl
Slide 73: Strongly committed to sustainability in transportation and logistics
INVESTOR PRESENTATION MAY 2020 Strongly committed to sustainability in transportation and logistics 73 ▪ XPO initiated collaborative research and development project with General State Administration of Spain to capture data about environmental and safety performance of duo - trailer vehicles, 2020
Slide 74: Strongly committed to sustainability in transportation and logistics (cont.)
INVESTOR PRESENTATION MAY 2020 Strongly committed to sustainability in transportation and logistics (cont.) 74 ▪ By the end of 2020, nearly 75% of XPO’s total space in Europe will operate LED lighting systems ▪ XPO’s warehouse of the future for Nestlé in the UK will begin operating in mid - 2020, eq
Slide 75: Highly skilled management team
INVESTOR PRESENTATION MAY 2020 Highly skilled management team 75 Bradley Jacobs Chief Executive Officer United Rentals, United Waste Lou Amo President, Brokerage and Expedite Electrolux, Odyssey Logistics Josephine Berisha Senior Vice President, Global Compensation and Benefits Morgan Stanley Tony B
Slide 76: Highly skilled management team (cont.)
INVESTOR PRESENTATION MAY 2020 Highly skilled management team (cont.) 76 Meghan Henson Chief Human Resources Officer Chubb, PepsiCo Erin Kurtz Senior Vice President, Communications AOL, Thomson Reuters Katrina Liddell Senior Vice President, Transportation Sales – North America Johnson Controls Inter
Slide 77: Business glossary
INVESTOR PRESENTATION MAY 2020 Business glossary 77 ▪ Contract Logistics: An asset - light, technology - enabled business characterized by long - term contractual relationships with high renewal rates, low cyclicality and a high - value - add component that minimizes commoditization. Contracts are t
Slide 78: Business glossary (cont.)
INVESTOR PRESENTATION MAY 2020 Business glossary (cont.) 78 ▪ Intermodal: An asset - light business that facilitates the movement of long - haul, containerized freight by rail, often with a drayage (trucking) component at either end. Intermodal is a variable cost business, with revenue generated by
Slide 79: Business glossary (cont.)
INVESTOR PRESENTATION MAY 2020 Business glossary (cont.) 79 ▪ XPO Connect™: XPO’s fully automated, self - learning digital freight marketplace connects shippers and carriers directly, as well as through company operations. XPO Connect™ gives customers comprehensive visibility across multiple transpo
Slide 80: Financial reconciliations
INVESTOR PRESENTATION MAY 2020 Financial reconciliations 80 The following table reconciles XPO’s net income attributable to common shareholders for the periods ended March 31, 2020 and 2019 to EBITDA and adjusted EBITDA for the same periods. 1 Adjusted EBITDA margin is calculated as adjusted EBITDA
Slide 81: Financial reconciliations (cont.)
INVESTOR PRESENTATION MAY 2020 Financial reconciliations (cont.) 81 Note: Refer to the “Non - GAAP Financial Measures” section on page 2 of this document Reconciliation of Non-GAAP Measures XPO Logistics, Inc. Consolidated Reconciliation of GAAP Net Income and Net Income Per Share to Adjusted Net In
Slide 82: Financial reconciliations (cont.)
INVESTOR PRESENTATION MAY 2020 Financial reconciliations (cont.) 82 Notes: 2016 and 2017 data have been recast to reflect the impact of Accounting Standards Update 2016 - 18 Refer to the “Non - GAAP Financial Measures” section on page 2 of this document The following table reconciles XPO’s net cash
Slide 83: Financial reconciliations (cont.)
INVESTOR PRESENTATION MAY 2020 Financial reconciliations (cont.) 83 Note: Refer to the “Non - GAAP Financial Measures” section on page 2 of this document The following table reconciles XPO’s Transportation segment operating income for the periods ended March 31, 2020 and 2019 to EBITDA and adjusted
Slide 84: Financial reconciliations (cont.)
INVESTOR PRESENTATION MAY 2020 Financial reconciliations (cont.) 84 Note: Refer to the “Non - GAAP Financial Measures” section on page 2 of this document The following table reconciles XPO’s Logistics segment operating income for the periods ended March 31, 2020 and 2019 to EBITDA and adjusted EBITD
Slide 85: Financial reconciliations (cont.)
INVESTOR PRESENTATION MAY 2020 Financial reconciliations (cont.) 85 Note: Refer to the “Non - GAAP Financial Measures” section on page 2 of this document XPO Logistics North American Less-Than-Truckload Adjusted Operating Ratio (Unaudited) (In millions) The following table reconciles XPO’s revenue a
Slide 86: Financial reconciliations (cont.)
INVESTOR PRESENTATION MAY 2020 Financial reconciliations (cont.) 86 Notes: Adjusted EBITDA was prepared assuming 100% ownership of XPO Logistics Europe Refer to the “Non - GAAP Financial Measures” section on page 2 of this document The following table reconciles XPO’s net income (loss) attributable
Slide 87: Financial reconciliations (cont.)
INVESTOR PRESENTATION MAY 2020 Financial reconciliations (cont.) 87 Note: Refer to the “Non - GAAP Financial Measures” section on page 2 of this document Reconciliation of Non-GAAP Measures XPO Logistics, Inc. Reconciliation of GAAP Revenue to Organic Revenue (Unaudited) (In millions) The following