Xpo, Inc. · NYSE:XPO
Xpo — XPO Logistics — Investor Presentation (February 2020)
86 slides from Xpo's investor presentation, Feb 10, 2020
Slide 1: Investor Presentation February 2020
INVESTOR PRESENTATION FEBRUARY 2020 v FEBRUARY 2020 Investor Presentation
Slide 2: Disclaimers
INVESTOR PRESENTATION FEBRUARY 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 GAA
Slide 3: Exploration of strategic alternatives
INVESTOR PRESENTATION FEBRUARY 2020 3 Exploration of strategic alternatives On January 15, 2020, XPO Logistics announced that its board of directors authorized a review of strategic alternatives, including the possible sale or spin - off of one or more of our business units. There can be no assuranc
Slide 4: Table of contents
INVESTOR PRESENTATION FEBRUARY 2020 Table of contents 4 1 2 3 4 5 Investor highlights Company overview Business overview Financial highlights and key metrics Supplemental materials North American contract logistics European contract logistics North American less - than - truckload North American tra
Slide 5: Investor highlights: Key factors driving growth and returns
INVESTOR PRESENTATION FEBRUARY 2020 Investor highlights: Key factors driving growth and returns 5 1 Leading positions in the fastest growing sectors of transportation and logistics ▪ Top three industry positions across all major business units ▪ Over 60% of XPO’s revenues are in industry sectors tha
Slide 6: Large, addressable growth opportunity in each part of the business
INVESTOR PRESENTATION FEBRUARY 2020 Large, addressable growth opportunity in each part of the business 6 1 C ompany revenue data, excluding intersegment elimination, as of FY 2019 2 North American transportation industry size includes entire for - hire US trucking industry 3 European transportation
Slide 7: Global provider of significant capacity for customers
INVESTOR PRESENTATION FEBRUARY 2020 Global provider of significant 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 494 cross - docks 764 contract logistics f
Slide 8: Key metrics
INVESTOR PRESENTATION FEBRUARY 2020 Key metrics 8 US 59% France 12% UK 12% Spain 5% Other 12% REVENUE BY MIX 1 Asset - Based 31% Asset - Light 69% Total Revenue 2019: $16.6 billion REVENUE BY GEOGRAPHY 1 1 Geographic and mix data as of FY 2019; key statistics as of December 31, 2019 CUSTOMERS Over 5
Slide 9: Superior platform to capitalize on high growth in e-commerce
INVESTOR PRESENTATION FEBRUARY 2020 Superior platform to capitalize on high growth in e - commerce 9 Expertise developing customized e - commerce solutions ▪ Unique provider of combined, customized solutions: warehouse management, carrier management and reverse logistics for e - commerce and omnicha
Slide 10: ~$700 million to $1 billion of potential profit growth opportunity by 2022
INVESTOR PRESENTATION FEBRUARY 2020 ~$700 million to $1 billion of potential profit growth opportunity by 2022 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 KE
Slide 11: Technology blueprint focuses on innovation in four areas
INVESTOR PRESENTATION FEBRUARY 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 ▪ Connectivity thr
Slide 12: Pervasive focus on productivity and results
INVESTOR PRESENTATION FEBRUARY 2020 Pervasive focus on productivity and results 12 Customers trust us with 160,000 ground shipments and more than seven billion inventory units daily CONTRACT LOGISTICS ▪ Proprietary WMx warehouse platform manages complex operations, assimilates automation and enables
Slide 13: XPO's proprietary technology is a springboard for profit improvements
INVESTOR PRESENTATION FEBRUARY 2020 XPO’s proprietary technology is a springboard for profit improvements 13 LABOR AND CAPACITY OPTIMIZATION Cohesive suite of proprietary technology products address the most critical supply chain disciplines, providing mode - agnostic, intelligent and adaptive solut
Slide 14: XPO Connect is at the forefront of transportation automation
INVESTOR PRESENTATION FEBRUARY 2020 XPO Connect™ is at the forefront of transportation automation 14 Expands revenue and margins ▪ Accelerates transactions by automating load - tendering, pricing, bidding, buying and tracking ▪ Unlocks cross - selling opportunities across modes ▪ Penetrates tier - t
Slide 15: XPO Smart driving productivity through machine learning
INVESTOR PRESENTATION FEBRUARY 2020 15 BENEFITS ▪ Interactive software manages warehousing and distribution processes in unison ▪ Proprietary XPO analytics show the future impact of contemplated management decisions ▪ Business intelligence drives productivity and operational effectiveness ▪ Rapid an
Slide 16: WMx and integrated technology suite harmonize all logistics services
INVESTOR PRESENTATION FEBRUARY 2020 16 WMx and integrated technology suite harmonize all logistics services ▪ Enables sophisticated deployment of advanced automation ▪ Facilitates collaboration with world - class manufacturers to engineer customized solutions ▪ Provides in - house control of intelli
Slide 17: Highly skilled management team
INVESTOR PRESENTATION FEBRUARY 2020 Highly skilled management team 17 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 T
Slide 18: Highly skilled management team (cont.)
INVESTOR PRESENTATION FEBRUARY 2020 Highly skilled management team (cont.) 18 Tavio Headley Senior Director, Investor Relations Jefferies, American Trucking Associations Meghan Henson Chief Human Resources Officer Chubb, PepsiCo Erin Kurtz Senior Vice President, Communications Thomson Reuters, AOL K
Slide 19: Financial highlights and key metrics
INVESTOR PRESENTATION FEBRUARY 2020 Financial highlights and key metrics
Slide 20: Industry-leading growth in revenue and adjusted EBITDA
INVESTOR PRESENTATION FEBRUARY 2020 Industry - leading growth in revenue and adjusted EBITDA 20 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 17,27
Slide 21: Strong free cash flow generation
INVESTOR PRESENTATION FEBRUARY 2020 Strong free cash flow generation 21 1 2018 free cash flow includes an incremental benefit of approximately $200 million from trade receivables programs 2 2019 free cash flow includes an incremental benefit of approximately $110 million from trade receivables progr
Slide 22: Operating flexibility across all economic environments
INVESTOR PRESENTATION FEBRUARY 2020 Operating flexibility across all economic environments 22 ▪ Blended model of owned, contracted and brokered capacity for truck transportation o Non - asset portion is predominantly variable - cost and includes brokerage operations, as well as contracted capacity w
Slide 23: Full-year 2020 financial targets
INVESTOR PRESENTATION FEBRUARY 2020 Full - year 2020 financial targets 23 Notes: 2020 targets for free cash flow and cash taxes assume cash interest expense of $285 million to $305 million 2020 target for free cash flow includes an incremental benefit to free cash flow of $50 million to $70 million
Slide 24: Q4 2019 results, compared with Q4 2018
INVESTOR PRESENTATION FEBRUARY 2020 Q4 2019 results, compared with Q4 2018 24 REVENUE $4.14 billion of revenue, down 6% ORGANIC REVENUE (2.7%) organic revenue NET INCOME 1 $96 million of net income, up 14% DILUTED EPS $0.93 diluted earnings per share, up 50% ADJUSTED NET INCOME 1 ADJUSTED DILUTED EP
Slide 25: Full year 2019 results, compared with 2018
INVESTOR PRESENTATION FEBRUARY 2020 Full year 2019 results, compared with 2018 25 REVENUE $16.65 billion of revenue, down 4% ORGANIC REVENUE 0.1% organic revenue growth NET INCOME 1 $379 million of net income, down 3% DILUTED EPS $3.57 diluted earnings per share, up 24% ADJUSTED NET INCOME 1 ADJUSTE
Slide 26: $2.5 billion share repurchase program
INVESTOR PRESENTATION FEBRUARY 2020 $2.5 billion share repurchase program 26 As of December 31, 2019, XPO had approximately 92 million shares of common stock outstanding, compared with 127 million shares outstanding on September 30, 2018. From December 14, 2018 through December 31, 2019, the company
Slide 27: Business overview: North American contract logistics
INVESTOR PRESENTATION FEBRUARY 2020 Business overview: North American contract logistics
Slide 28: #2 logistics provider in North America
INVESTOR PRESENTATION FEBRUARY 2020 #2 logistics provider in North America, with operations in Asia and Latin America 28 Partner of choice for large customers as a full - service provider of highly engineered, custom solutions ▪ Steady gains in market share over the last three years ▪ Consultative s
Slide 29: Preeminent reputation for innovation, expertise and quality of performance
INVESTOR PRESENTATION FEBRUARY 2020 Preeminent reputation for innovation, expertise and quality of performance Industry size ~$50 billion 2019 revenue $2.5 billion Countries 14 Locations 401 (319 North America) Facility space ~ 104 million sq. ft. (North America, Asia) Employees ~22,000 Average cont
Slide 30: XPO's footprint and scale are key competitive advantages
INVESTOR PRESENTATION FEBRUARY 2020 30 1 Warehouse sq. ft. as of December 31, 2019 and includes both leased and customer square footage XPO’s footprint and scale are key competitive advantages North America 96 million sq.ft . of warehouse space 1 Chile Asia 8 million sq.ft . of warehouse space 1 COU
Slide 31: Sophisticated capabilities, deeply integrated with customer supply chains
INVESTOR PRESENTATION FEBRUARY 2020 31 Sophisticated capabilities, deeply integrated with customer supply chains 31 ADVANCED AUTOMATION AND ROBOTICS INBOUND LOGISTICS AND MANUFACTURING SUPPORT REVERSE LOGISTICS AND AFTERMARKET SUPPORT WAREHOUSING ▪ Tech - enabled fulfillment continuously improved by
Slide 32: XPO Smart proprietary tools drive productivity and profit improvement
INVESTOR PRESENTATION FEBRUARY 2020 32 XPO Smart ™ proprietary tools drive productivity and profit improvement Forecasting Analytics Model Training Machine Learning TIME AND ATTENDANCE CLOUD APPLICATIONS IOT DATA MOBILE DEVICES AND HANDHELDS TRANSACTIONAL DATA LARGE - FORMAT DISPLAYS
Slide 33: Special software layer enables customization
INVESTOR PRESENTATION FEBRUARY 2020 33 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
Slide 34: XPO Direct transforms B2B and B2C distribution
INVESTOR PRESENTATION FEBRUARY 2020 XPO Direct TM transforms B2B and B2C distribution into a scaled, flexible - cost solution 34 Positive growth trajectory throughout first 12 months following national network launch ▪ Agile “fulfillment as a service” (FaaS) model ▪ Utilizes existing XPO network to
Slide 35: XPO Direct is a game-changer for customers
INVESTOR PRESENTATION FEBRUARY 2020 XPO Direct TM is a game - changer for customers in today’s on - demand economy 35 Scale and proximity Speeds up store replenishment and home delivery; reaches 99% of population with one - to two - day ground Fully integrated Provides a single tracking number from
Slide 36: Business overview: European contract logistics
INVESTOR PRESENTATION FEBRUARY 2020 Business overview: European contract logistics
Slide 37: Leading provider of technology-enabled, customized logistics in Europe
INVESTOR PRESENTATION FEBRUARY 2020 Leading provider of technology - enabled, customized logistics in Europe 37 #2 contract logistics provider in Europe, with the leading outsourced e - fulfillment platform ▪ Full - service positioning has led to consistent market share gains over the last three yea
Slide 38: Leading provider of technology-enabled, customized logistics in Europe: key metrics
INVESTOR PRESENTATION FEBRUARY 2020 Leading provider of technology - enabled, customized logistics in Europe KEY METRICS 38 Industry size ~ $80 billion 2019 revenue $3.6 billion Countries 14 Locations 381 Facility space ~ 96 million sq. ft. (9 million sq. m.) Employees ~34,000 Average contract lengt
Slide 39: Logistics network footprint and scale are major competitive advantages
INVESTOR PRESENTATION FEBRUARY 2020 39 XPO’s logistics network footprint and scale are major competitive advantages Europe 95 million sq. ft. (8.8 million sq. m.) of warehouse space Belgium Italy Russia Czech Republic Netherlands Spain France Poland Switzerland Germany Portugal United Kingdom Irelan
Slide 40: Integrated network with strong positioning and extensive reach across Europe
INVESTOR PRESENTATION FEBRUARY 2020 Integrated network with strong positioning and extensive reach across Europe 40 ▪ Flow optimization ▪ Space maximization ▪ Automated replenishment of materials and parts ▪ Inventory regulation through a vendor - management model ▪ A leading reverse logistics provi
Slide 41: Leading e-commerce and omnichannel service capabilities
INVESTOR PRESENTATION FEBRUARY 2020 Warehousing and value - added services ▪ Inbound quality assessment and inventory inspections ▪ Order pick, pack and customization, custom services, and pre - retailing ▪ Critical solutions for high - volume retail customers, such as ironing and dry cleaning ▪ In
Slide 42: Benefits of advanced automation and intelligent machines
INVESTOR PRESENTATION FEBRUARY 2020 XPO is reaping the benefits of advanced automation and intelligent machines 42 ▪ 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
Slide 43: Business overview: North American less-than-truckload
INVESTOR PRESENTATION FEBRUARY 2020 Business overview: North American less - than - truckload
Slide 44: LTL has a clear path to at least $1 billion of EBITDA
INVESTOR PRESENTATION FEBRUARY 2020 LTL has a clear path to at least $1 billion of EBITDA in 2021 44 Favorable long - term industry fundamentals ▪ Rational pricing dynamics ▪ Rapid growth of e - commerce driving retail shipments to LTL carriers National coverage offers advantages of scale ▪ Natural
Slide 45: Top three provider of LTL in North America
INVESTOR PRESENTATION FEBRUARY 2020 Top three provider of less - than - truckload (LTL) in North America 45 KEY METRICS Source: SJ Consulting Group 1 Includes fuel surcharge Industry size ~$43 billion 2019 revenue $3.8 billion Employees ~20,000 Cross - dock facilities 290 Number of tractors / traile
Slide 46: National LTL terminal coverage is a major advantage
INVESTOR PRESENTATION FEBRUARY 2020 XPO’s national LTL terminal coverage is a major advantage over regional providers 46
Slide 47: Compelling LTL value proposition appeals to diverse customer types
INVESTOR PRESENTATION FEBRUARY 2020 Compelling LTL value proposition appeals to diverse customer types 47 ▪ Safety and reliability – One of the largest, most modern and safest - equipped fleets in industry ▪ Capacity – 8,000 tractors, 25,000 trailers and more than 13,000 professional drivers, operat
Slide 48: Technology prioritizes three areas of LTL network optimization
INVESTOR PRESENTATION FEBRUARY 2020 Technology prioritizes three areas of LTL network optimization 48 DYNAMIC ROUTE OPTIMIZATION INTELLIGENT LOAD - BUILDING ADVANCED PRICING OPTIMIZATION Proprietary technology becomes continually smarter at automating operations for optimal results Intelligent routi
Slide 49: XPO Smart productivity tools deployed in LTL cross-docks
INVESTOR PRESENTATION FEBRUARY 2020 XPO Smart ™ productivity tools deployed in LTL cross - docks nationally 49 ▪ Averaging ~9% more motor moves per hour on LTL cross - dock, with high employee engagement through gamification ▪ Analytics provide deep visibility into scheduled versus active workers by
Slide 50: Business overview: North American transportation
INVESTOR PRESENTATION FEBRUARY 2020 Business overview: North American transportation Truck brokerage / expedite Intermodal / drayage Last mile Managed transportation Global forwarding
Slide 51: Combination of scale, technology and service range is unique
INVESTOR PRESENTATION FEBRUARY 2020 Combination of scale, technology and service range is unique in North America 51 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 ▪ Cus
Slide 52: Truck brokerage is a vast opportunity
INVESTOR PRESENTATION FEBRUARY 2020 Truck brokerage is a vast opportunity to sell XPO’s network capacity 52 KEY METRICS Industry size 1 ~$375 billion 2019 revenue 2 $1.66 billion Locations 23 Employees ~1,000 Carrier relationships 38,000 Accessible trucks Over 1,000,000 1 Total truckload industry si
Slide 53: Demand driven by expansion of transportation outsourcing
INVESTOR PRESENTATION FEBRUARY 2020 Demand for XPO solutions driven by expansion of transportation outsourcing 53 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 IN
Slide 54: Brokerage value proposition rooted in scale and disruptive technology
INVESTOR PRESENTATION FEBRUARY 2020 XPO’s brokerage value proposition is rooted in scale and disruptive technology 54 ▪ Cloud - based, digital XPO Connect™ platform allows shippers to access capacity, assign loads and track freight movements; carriers use personalized dashboards to post capacity and
Slide 55: Proprietary technology drives efficiency, volume and margin expansion
INVESTOR PRESENTATION FEBRUARY 2020 Proprietary technology drives efficiency, volume and margin expansion MODE AGNOSTIC – Shows shippers and carriers supply and demand in real time across truck, rail and ocean OPERATIONAL SYNERGIES – Provides full visibility of customer relationships to facilitate u
Slide 56: XPO Connect comprehensive functionality
INVESTOR PRESENTATION FEBRUARY 2020 56 COMPREHENSIVE FUNCTIONALITY 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 BOOKING Reque
Slide 57: Drive XPO app fully mobilizes procurement process
INVESTOR PRESENTATION FEBRUARY 2020 57 Drive XPO ™ app fully mobilizes procurement process ▪ Carriers use Drive XPO TM self - service dashboard to access XPO Connect TM from their trucks ▪ Full - functioned transactional platform ▪ Intuitive tools for capacity posting, bidding, negotiation, load boo
Slide 58: Third largest intermodal provider in North America
INVESTOR PRESENTATION FEBRUARY 2020 Third largest intermodal provider in North America 58 Industry size ~$43 billion 2019 revenue $948 million Locations 37 terminals Employees ~ 400 Number of 53 - ft. containers / chassis ~10,000 / 5,000 Drayage trucks under contract Over 25,000 KEY METRICS Source:
Slide 59: Unique competitive advantages differentiate intermodal service offering
INVESTOR PRESENTATION FEBRUARY 2020 Unique competitive advantages differentiate intermodal service offering 59 ▪ Proprietary intermodal management system tracks door - to - door movements of long - haul freight with GPS on containers ▪ Communicates constantly with railroads to proactively identify a
Slide 60: #1 provider of last mile logistics for heavy goods
INVESTOR PRESENTATION FEBRUARY 2020 #1 provider of last mile logistics for heavy goods in North America 60 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 platform at scale,
Slide 61: Growth in online orders of large items increases demand
INVESTOR PRESENTATION FEBRUARY 2020 Growth in online orders of large items increases demand for XPO’s last mile service 61 132 136 159 187 218 250 287 331 380 439 508 582 660 743 828 915 1,006 2008A 2009A 2010A 2011A 2012A 2013A 2014A 2015A 2016A 2017A 2018A 2019E 2020E 2021E 2022E 2023E 2024E E - C
Slide 62: Unmatched combination of scale, technology and last mile experience
INVESTOR PRESENTATION FEBRUARY 2020 Unmatched combination of scale, technology and last mile experience 62 ▪ Leading scale drives long - term relationships with best - in - class contract carriers ▪ Post - delivery feedback loops facilitate issue resolution and protect brand loyalty ▪ Flexible servi
Slide 63: Managed transportation provides optimal capacity procurement
INVESTOR PRESENTATION FEBRUARY 2020 Managed transportation provides optimal capacity procurement 63 Leading integrated technology platform ▪ Integrated with XPO Connect™ ▪ Proprietary tracking and visibility tool ▪ Worry - free set - up and disaster recovery Onsite control tower ▪ Account management
Slide 64: Freight forwarding network has global reach
INVESTOR PRESENTATION FEBRUARY 2020 Freight forwarding network of local market experts has global reach 64 Strong technology capabilities Integration with XPO Connect™ enhances visibility and efficiency Centralized control Global reach for customers, with rigorous oversight of pickup, delivery and f
Slide 65: Business overview: European transportation
INVESTOR PRESENTATION FEBRUARY 2020 Business overview: European transportation Truck brokerage Dedicated truckload Less - than - truckload Managed transportation Global forwarding Last mile
Slide 66: Leading positions in fast-growing sectors
INVESTOR PRESENTATION FEBRUARY 2020 Leading positions in fast - growing sectors 66 Expansive platform with strong positions across Europe ▪ #1 transportation company by size across our primary geographical perimeter (UK, France, and Spain/Portugal/Morocco) ▪ Network of nearly 200 locations serving c
Slide 67: Leading provider of truck brokerage and LTL transportation in Europe
INVESTOR PRESENTATION FEBRUARY 2020 Leading provider of truck brokerage and LTL transportation in Europe 1 Includes truckload and brokerage Source: Bain 67 ▪ Leading provider of truck brokerage in Europe ▪ Leading less - than - truckload (LTL) provider in the UK, France, Spain and Portugal, with dai
Slide 68: Business strategy tailored for key markets
INVESTOR PRESENTATION FEBRUARY 2020 LARGEST MARKETS BY % OF 2019 EUROPEAN TRANSPORTATION REVENUE Business strategy tailored for key markets 68 FRANCE UNITED KINGDOM AND IRELAND SPAIN AND PORTUGAL 26% 17% 46% ▪ Uses blended model of XPO - owned trucks and contracted independent carriers for less - th
Slide 69: LTL locations serving countries across Europe
INVESTOR PRESENTATION FEBRUARY 2020 Over 100 LTL locations serving countries across Europe 69 International Hub XPO International Hub Partner Platform XPO Platform Partner ▪ Transportation capabilities from a single pallet to full truckloads ▪ ~60,000 pallets delivered daily over domestic networks ▪
Slide 70: Freight Optimizer uses advanced analytics to optimize pricing
INVESTOR PRESENTATION FEBRUARY 2020 Proprietary Freight Optimizer uses advanced analytics to optimize pricing strategy 70 ▪ Leverages machine learning to match shippers’ freight with an established network of trucking carriers ▪ Finds optimal capacity for each load by analyzing data from multiple so
Slide 71: Comprehensive plan to grow revenue and expand margin
INVESTOR PRESENTATION FEBRUARY 2020 Comprehensive plan to grow revenue and expand margin 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 mi
Slide 72: Supplemental materials
INVESTOR PRESENTATION FEBRUARY 2020 Supplemental materials
Slide 73: XPO is widely recognized for performance and culture
INVESTOR PRESENTATION FEBRUARY 2020 XPO is widely recognized for performance and culture 73 ▪ Named one of the World’s Most Admired Companies by Fortune, 2018, 2019, 2020 ▪ Partnered with MIT as the first global logistics company to join the Industrial Liaison Program, 2019 ▪ Named a Disruptive Tech
Slide 74: Highlights of XPO's sustainability culture
INVESTOR PRESENTATION FEBRUARY 2020 Highlights of XPO’s sustainability culture 74 ▪ 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 Recordable I
Slide 75: Highlights of XPO's sustainability culture (cont.)
INVESTOR PRESENTATION FEBRUARY 2020 Highlights of XPO’s sustainability culture (cont.) 75 ▪ US warehouse employees received an average annual wage increase of 8%, with over 30% receiving an increase of 10% or more ▪ XPO drivers worldwide travelled more than 1.4 billion accident - free miles ▪ XPO’s
Slide 76: Strongly committed to sustainability in transportation and logistics
INVESTOR PRESENTATION FEBRUARY 2020 Strongly committed to sustainability in transportation and logistics 76 ▪ XPO begins 2020 collaborative research and development project with General State Administration of Spain to capture data about environmental and safety performance of duo - trailer vehicles
Slide 77: Strongly committed to sustainability (cont.)
INVESTOR PRESENTATION FEBRUARY 2020 Strongly committed to sustainability in transportation and logistics (cont.) 77 ▪ 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 2020, equ
Slide 78: Business glossary
INVESTOR PRESENTATION FEBRUARY 2020 Business glossary 78 ▪ 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
Slide 79: Business glossary (cont.)
INVESTOR PRESENTATION FEBRUARY 2020 Business glossary (cont.) 79 ▪ 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 generate
Slide 80: Business glossary (cont.)
INVESTOR PRESENTATION FEBRUARY 2020 Business glossary (cont.) 80 ▪ 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 tr
Slide 81: Financial reconciliations
INVESTOR PRESENTATION FEBRUARY 2020 Financial reconciliations 81 The following table reconciles XPO’s net income attributable to common shareholders for the periods ended December 31, 2019 and 2018 to EBITDA and adjusted EBITDA for the same periods. Notes: The sum of quarterly net income attributabl
Slide 82: Financial reconciliations (cont.)
INVESTOR PRESENTATION FEBRUARY 2020 Financial reconciliations (cont.) 82 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 N
Slide 83: Financial reconciliations (cont.)
INVESTOR PRESENTATION FEBRUARY 2020 Financial reconciliations (cont.) 83 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
Slide 84: Financial reconciliations (cont.)
INVESTOR PRESENTATION FEBRUARY 2020 Financial reconciliations (cont.) 84 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 reve
Slide 85: Financial reconciliations (cont.)
INVESTOR PRESENTATION FEBRUARY 2020 Financial reconciliations (cont.) 85 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) attribut
Slide 86: Financial reconciliations (cont.)
INVESTOR PRESENTATION FEBRUARY 2020 Financial reconciliations (cont.) 86 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 follo
XPO Logistics — Investor Presentation (February 2020) on 6ix