Xpo, Inc. · NYSE:XPO
Xpo — XPO Logistics — Investor Presentation (November 2014)
40 slides from Xpo's investor presentation, Nov 5, 2014
Slide 1: Investor Presentation November 2014
Exhibit 99.1 Investor November Presentation 2014
Slide 2: Forward-Looking Statements Disclaimer
Forward-Looking This company’s deemed “may,” However, These any acquisitions, XPO’s develop companies’ regulation. even 2and law. our future XPO document ifforward-looking filings ability substantially “plan,” perception to and undertakes the results, be, All full largest implement including absence
Slide 3: One of the Largest Transportation Logistics Providers
Oneprovider We #4 #3 #1 Leading Growing Sources 3transportation freight manager facilitate of the for provider presence brokerage Largest rankings: ofover intermodal cross-border last-mile expedited of 33,000 in 3PLs technology-enabled firm freight Transport logistics in shipments deliveries and ser
Slide 4: Clearly Defined Strategy for Value Creation
Clearly Acquire Significantly Open 4We arecold-starts committed Defined companies scale Strategy where to up that providing and sales bring for optimize Value recruitment value world Creation existing and class are canservice highly operations drive scalable revenue to customers as the industry’s mo
Slide 5: Strong Capital Investments Endorse XPO's Growth Plan
$700 Three to –Pension Strong Capital 2017 5$9 Transaction PSP further billion Million financial global Investments, endorsement primarily Plan XPO’s of revenue institutions Strategic completed targets growth will GIC of and raised be Investment XPO’s of strategy invested September used $575 Singapo
Slide 6: Disciplined Execution of Growth Plan
Precise Completed 23 Introduced Added procurement Stratified Created 6Disciplined cold-starts national Execution aleading-edge customers, culture scalable 13 focus and in strategic operations approximately last-mile of on ofIT passionate Growth assigned operational recruiting platform acquisitions o
Slide 7: Strong Integrated Network
Strong Integrated 199 Approximately More drayage, Relationships representing 7Access locations than Commitment toexpedited 60,000 network 4,000 more in with 10,700 the owner-operator miles than an and with U.S., toadditional employees 667,000 Shipper last of cross-company Canada, network mileSatisfa
Slide 8: Significant Growth Model Drivers
Significant Strategic Cold-starts: to Scale state-of-the-art Market growing Multi-modal: the 8M&A sales most and program: demand: talent areas compelling accounts: productivity: Growth expand become of training focus build logistics market Embedded footprint range on the leadership recruit and the l
Slide 9: Secular Growth Trends Driving Outsourcing
Secular Growth Outsourcing Conversion Near-shoring Just-in-time Driver Automation We 9to capitalize haveshortage Trends inpositioned e-commerce from lean of on of ofthe Driving logistics each manufacturing production over-the-road transportation XPO’s of these retailing Industry services service tre
Slide 10: Leading Positions in High-Growth Outsourcing Sectors
Leading Market Size Sector($ Truck Long-haul Intermodal manufacturing Heavy last-mile Sources: 10 Growth brokerage goods, Projected Positions billions)(x Armstrong $13 rail $155-6 efficiencies in3-5 $50 times Mexico intimes GDP) &High-Growth 2-3 Associates, Outsourcing times near-sourcing Growth and
Slide 11: Major Customer Coverage Serving Many Industries
Major Serving 15,000 Retail, Industrial Manufacturing Life Commercial Aerospace Technology Source: Governmental 11 Sciences Coverage: E-commerce customers Company over U.S., data Mexico and Canada
Slide 12: Compelling Reasons for New Breed Acquisition
Acquisition Compelling Transformational C –M Capitalizes transportation support, Significant accounts, Source: 12ombined ost differentiated Company and New company cross-selling on of reasons other management, trend New Breed for data contract supply Breed for toward of XPO’s customers approximately
Slide 13: New Breed: Technology-enabled Contract Logistics
XPO Leads Technology-enabled V 10 Focuses contract –T medical Sources: 13 op echnology, ery years 10 stable Gains the customers equipment logistics on Company most relationships industries atelecom, Preeminent desirable have data and solutions e-commerce, with utilized select with sector Platform st
Slide 14: New Breed's Attractive Financial Model
NewReturn 16% 38% Approximately past Low largely (1) 14 three capex revenue return Breed’s devoted years on requirements onAttractive CAGR invested invested 99% to ITcontractual for development capital capital Financial the (4.2% past equals (FY of revenue 10 Model revenue 2013) years ongoing renewa
Slide 15: Integration of Industry-defining Technology
Industry-defining Integration –Combination Sources: 15XPO Breed New Breed’s NLM Company ofof is acquisition proprietary transportation the two Technology data largest robust has IT web-based managed will doubled management create transportation XPO’s manager strong system ITdifferentiation ofworkfor
Slide 16: New Breed Transaction Details
Details $615 Adds Multiple Transaction 16 million approximately ofofthe approximately completed cash Newpurchase Breed $597 September Transaction million 8.0 price times of 2, trailing revenue 2014 12 (trailing months12adjusted monthsEBITDA ended June 30, 2014)
Slide 17: Senior Notes Proceeds Finance Acquisition
$500 Proceeds –7.875% High Additive Long-term 17Callable Million yield senior to used at market leverage $415 XPO’s Senior to notes finance million could target: option, Notes maturing present the accounts Issued 3September acquisition toSeptember 4attractive times August receivable 2016 EBITDA of1,
Slide 18: Acquired ACL: Last Mile Logistics Provider
Acquired Compelling Non-asset, Moves Adds Complementary Pipeline 18 approximately high active ACL multi-regional, reasons volumes in for delivery July last for 160 of2014 mile the e-commerce employees, schedules last transaction acquisitions mile allow logistics purchases 14 locations XPOprovider La
Slide 19: ACL Transaction Details
Detailsapproximately $36.5 Adds Multiple Transaction 19 million ofofthe approximately completed ACL cash purchase Transaction $63July million 5.9 2014 price times of revenue trailing (trailing 12 months 12 adjusted months ended EBITDA June 30, 2014)
Slide 20: Acquired Pacer's Intermodal Business
Acquired Gained –30 Added Sources: 20 Access Third #1years’ Decades-deep provider $980 instant largest SJ to experience Pacer 60,000 Consulting million ofscale provider in relationships cross-border March miles in of North revenue Group, ofof 2014 intermodal network American with Mexico Inc., (FYthe
Slide 21: Major Intermodal Market Opportunity
Major $15 Growing One Enables Rail Intermodal Sources: 21 billion of is Intermodal more the shippers SJ atfastest-growing sector can three Consulting fuel-efficient lower to in Market lower five North shipper’s Group, times Opportunity transportation than America areas GDP truckload Inc., cost of tr
Slide 22: High-Growth Cross-Border Near-shoring Sector
High-Growth Near-shoring Competitively Faster Can Growth Large 2.8 Sources: 22 million beopportunity speed-to-market more driven AlixPartners trucks cost in Cross-Border priced by Mexico effective move billions to convert labor and than cross-border – fast of company than force Mexico overseas dolla
Slide 23: Strong Intermodal Integration and Cross-selling
Integration Strong Energetically Q3: New On Source: 23 track Intermodal Rail value Company toOptimizer of realize proposition cross-selling Intermodal volume data $15 technology million upas Isintermodal 6% aDriving large, and ofplatform targeted revenue single-source Results to XPO incost up betacu
Slide 24: Acquired and Rebranded Last Mile Logistics
Acquired Rebranded Largest Facilitates Leading, Strong Source: 24 customer-centric provider Company proprietary 3PD approximately as XPO in of August data Last last-mile software culture Mile 2013 seven logistics forbuilt million workflow by forlast-mile experienced heavy and goods customer deliveri
Slide 25: Last Mile's Exciting Market Potential
Last Mile’s XPO Heavy Strong Only Highly Sources: 25 30% Last goods tailwinds fragmented Norbridge, Mile currently Exciting home serves from with delivery going Inc. Market e-commerce onemany and through ofgrowing Potential EVE the small, fastest-growing Partners 3PLs and regional at outsourcing fiv
Slide 26: Capitalizing on Last Mile Platform Advantages
XPO efficiencies, Capitalizing Cost Acquired Highly Acquisition Source: 26 Hasscalable Company Optima a Strong of onACL major supplier, productivity, Service data Platform brought advantages leading Solutions for deep access Last arranger relationships ofin scale Mile to November trucks, of andlast
Slide 27: Acquired and Rebranded Expedited Business
Acquired Rebranded #1 Manages Online Carriers Benefits Source: 27 web-based auction Company bid from an NLM ason annual XPO expediter, trend system loads in data December NLM run toward that proprietary rate made arejust-in-time of2013 awarded XPO moretothe than XPO electronically inventories, #1thr
Slide 28: Focused Sales and Marketing Effort
Focused Differentiate Single Strategic National Branch Capture 72% Sources: 28 ofpoint network top more Sales accounts SJ accounts 50 Consulting of XPO of customers and contact expands the team team by Marketing $32 providing for Group, focused marketing billion our are each using reach Effort Inc.,
Slide 29: Proprietary IT Platform Increases Productivity
Increasing One Proprietary Highly Total (1) 29 Includes common ITscalable budget Productivity freight full ITof load year platform approximately optimizer execution ITthrough budgets for tools freight and Technology for $115 for tendering Pacer brokerage pricing million andvia and New for inautomate
Slide 30: Growth Through Freight Brokerage Cold-starts
Growth 23 12 Freight Up Low Hire Position Source: 30 cold-starts freight from strong capital brokerage Company through in $120 brokerage; prime industry investment million Cold-starts recruitment cold-starts data veterans 10 12can freight months deliver on as areas forwarding; branch anago annual ou
Slide 31: CEO Bradley Jacobs' Track Record
CEO Bradley Founded Hamilton Amerex United 31 Waste: Waste Rentals: Rentals Oil and Resources: Associates: led stock S. Created stock Built Jacobs four outperformed outperformed Grew world’s highly 5th Built largest global successful one largest S&P solid of oil S&P world’s equipment trading 500 was
Slide 32: Highly Skilled Management Team
Highly Troy John Scott Gordon General Louis Karl Paul Dominick President, Julie Greg Senior Mario Chief The 32 full Meyer Smith Luna Hardig Cooper Ritter Malat Operating Financial Strategy Executive Commercial Information DeJoy Harik Vice Skilled Devens Counsel management Intermodal Freight Muzi Pac
Slide 33: Deep Operational Bench
Deep Dave Bud President, Will Chief Tom Senior Drew Doug Jenna Regional Jake Sr. Lou Jim Strategic Chris Vice 33 Operational Commiskey Amo Workmon O’Shea Schnell Connolly President, Bench Rowe Duffell Wilkerson Technology Sales George Sargent Vice Accounts Vice Sales Electrolux, XPO and President, E
Slide 34: Revenue Growth Trajectory
Revenue 2011 Approximately Organic Net Gross Q3 $194 +242% (1) $662 34 Includes company-wide, ‘13 revenue revenue revenue Revenue Q3 growth and trajectory ‘14 only up Margin ofup $2.6 ($ 403% up $177 partial 242% millions) 48% 2014 billion Growth Organic million benefit vs.annual 2013 growth of ACL
Slide 35: Key Financial Statistics by Business Unit
Key‘13 Freight +45% +240% $519 $153 $25 Q3 Revenue 35 Revenue $19 Financial $36 +212% Q3 Brokerage ($‘14 millions) Growth $60 Statistics Q3 Expedited ‘13byQ3 Business ‘14Transportation Q3 Unit, ‘13 Q32014 ‘14Freight vs. 2013Forwarding
Slide 36: First 33 Months of Quarterly Revenue Growth
FirstQ2 31% $109 $194 $257 $282 $581 $662 $45 Q1 2012 Revenue 36 $55 Average 33 $114 2013 Q3 Months $71 ($Q4 $137 2014 millions) Quarterly Q1ofQ2 Growth Q3Growth Q4Strategy Q1Rate Q2 Q3
Slide 37: Financial Targets
Financial As Annual Full $9 $575 37 billion ofyear million December revenue EBITDA 2017 Targets of revenue of EBITDA run 31, runrate 2014 rateofofatatleast least$3 $150 billion million
Slide 38: Incentivized Equity Ownership and Capitalization
Incentivized Equity Common Preferred Warrants Convertible Stock Fully (1) shares assuming, of (5) 38 $37.67 Based Dilutive Diluted Options on ownership (Strike Shares Stock aon on pro effect Senior XPO September SEC aShares and pro forma Equivalent Price 10.5 76.6 aligns Management beneficial of RSU
Slide 39: Clear Path for Value Creation
Clearmanagement Significant Leading Compelling Passionate Top 39 Path positions for culture growth value Significant talent proposition in of embedded fastest-growing on-time with Value skills performance in asCreation XPO’s a multi-modal, that areas uniquely business of andtransportation productivi
Slide 40: Additional Information and Participants in Solicitation
Additional “Investment”) STATEMENT THEY INFORMATION www.xpo.com. Participants XPO directors regarding documents be 40 anyand will WILL sale isits file the Information may available ofin executive direct CONTAIN asecurities with AND Solicitation You proxy beABOUT obtained, the and may OTHER instateme
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