Xpo, Inc. · NYSE:XPO
Xpo — XPO Logistics — Investor Presentation (July 2016)
36 slides from Xpo's investor presentation, Jul 18, 2016
Slide 1: XPO Logistics Investor Presentation and Transcript July 2016
Exhibit 99.1 XPO Logistics XPO Investor Presentation and Transcript July 2016
Slide 2: Disclaimers
Disclaimers income for under by management, may financial GAAP. supplemental Section saving 2016 of “guidance,” looking factors performance contribute capital successfully our strategy, drivers; current changes; and or circumstances, our forward-looking operations.Forward-looking removing the abilit
Slide 3: XPO Logistics at an Inflection Point
XPOlogistics and service Accelerating from $1.25 Is offerings, at Inflection billion Numerous free cash geographies 2016F Point flow company-specific adjusted for model Profitability and EBITDA customer with lowmargin and capex to verticals our Cash opportunities requirements $1.7 Flow Strong billio
Slide 4: We Are a Top 10 Global Technology-Enabled Logistics Company
We Are aLogistics Reverse Revenue customers Freight Top manage 10 Brokerage Global Technology-Enabled their goods Logistics / Last moreMile Company efficiently Managed / Expedite 2016 throughout Transportation Forecast Intermodal their Revenue: andsupply High-Value-Add Drayage $15 chains billion Les
Slide 5: Global Scale with Well-Diversified Business Profile
Global meters) (12%) (6%) not add Business Industrial Scale to Gross 100% with Revenue / Professional /due Manufacturing Well-Diversified to rounding Profile Services (1)5(11%) By |Business Investor Country (4%) Automotive Energy Presentation Mix of Operation Key / (9%) Oil Metrics &July Consumer Ga
Slide 6: Extensive Infrastructure and Asset-Light Revenue Mix
Extensivelogistics operators intermodal contract with Customer boxes; highly facilities and Service engaged 9,000Asset-Light Infrastructure chassis employees Non-asset (66%) Technology: andAsset-Based Capacity transportation Best-in-class, Comprehensive (34%) network: (1) Revenue proprietary 10,000
Slide 7: XPO Leads in Technology
XPO Leads Differentiated chain more than management 5 the billion competitive Industry technology inventory in advantages: Rapid units $425 Technology 7 million | Investor – Proprietary ITDevelopment Presentation budgetFreight in 2016 July Highly Optimizer with 2016 scalable over XPO (freight 160Log
Slide 8: Highly Skilled Management Team
Highly COO, Foods, Operating FedEx Transport–Europe Frito-Lay, Skilled Officer Supply Management Roadway Jean-Luc John Chain, Hardig President, Declas Americas Team Stifel Bradley Senior Nicolaus, Less-Than-Truckload Ramon VP, Jacobs Genemaras Development, Alex. United Brown Rentals, Chief and Chief
Slide 9: Highly Skilled Management Team (Cont'd)
Highly Chief Henson O’Shea Global Logistics Skilled Chief Chubb Managing Accounting Sales Management Group, and Director, PepsiCo Marketing Officer Team Logistics–Europe Chief Paul (Cont’d) Officer, Human SmithLast Mario President, Resources Partial Mile Harik 3PD, list, Intermodal Officer Oakleaf i
Slide 10: Serving Blue Chip Customers in Every Major Vertical
Serving Blue Chip Customers in Every Major Vertical Partial list. Any trademarks or logos used in this presentation are the property of their respective owners 10 | Investor Presentation July 2016 XPO Logistics
Slide 11: Serving Blue Chip Customers in Every Major Vertical (Cont'd)
Serving Blue Chip Customers in Every Major Vertical (Cont’d) Partial list. Any trademarks or logos used in this presentation are the property of their respective owners 11 | Investor Presentation July 2016 XPO Logistics
Slide 12: $1 Trillion Addressable Opportunity and Cross-Selling
Only European single-digit organization 100 only of Europe XPOCommerce, Customers North 1.5% Logistics (3)(2) Service American Current organic Implemented ~$425 A.T. (3) 73 categories Share Kearney, growth Transport and of XPO’s of European growth-based achievable $1 Transport are Truck Trillion top
Slide 13: Leading Positions in Fastest Growing Sectors
Leading Contract Highest and America FTR management #3 Associates, largest service Position Last Logistics estimates Mile intermodal levels SJ in35% 5% Consulting Some in13 52the –provider –|of 6x Investor 3x industry the Fast-growing Non-commoditized Group, Fastest inPresentation for North Inc., Gr
Slide 14: Clear Path to $1.7 Billion EBITDA Target
Clearprofit run-rate LTL Growth Continuous Transformation Path Differentiated cost improvement toimprovement savings $1.7 Officer, Billion togrowth be Ramon opportunities and EBITDA implemented knowledge-sharing driven Genemaras, Target in($90 part over bymillion by has the 2018 leading previously n
Slide 15: XPO Logistics Key Lines of Business
XPOLines Key Logistics of Business
Slide 16: Contract Logistics
Contract Logistics expertise requirements customers in$1+ high-growth asbillion a percentage Long global Term sectors sales ofRecurring revenue that pipeline trend lead Revenue toward 16to| Investor strong outsourcing: Asset-light free Presentation cash business retail, flow July conversion e-commer
Slide 17: Freight Brokerage
Freight the through cycleBrokerage technology Global Footprint High and the Growth High tenure free and ofHigh cash the sales flow Return force conversion Non-asset Pricingand accuracy business minimalthat enabled capex places by Fragmented shippers’ XPO’s proprietary freight marketwith with algorit
Slide 18: Last Mile
Last Mile include proprietary demand nearly from Demand customer Eurozone all ofPropelled the experience Closed top 30bybig-box $30 Major technology million Tailwinds retailers of Shifting new and Asset-light business e-tailers third party in in business 1Q the LTL 2016, U.S. spend that North with a
Slide 19: North American LTL
North adjusted Grew post-acquisition Recognized promised incomeAmerican toShipments GAAP as Best-In-Class operating Network LTL operating delivered Rapid income covers income Progress North when 99% byAmerican 19 54% promised on of | Investor Profit postal in Q1Footprint Ability Improvement codes 20
Slide 20: Intermodal and Drayage
Intermodal 3rd additional Increasing largestdrayage customer intermodal and Drayage trucks satisfaction provider Benefiting Near-shoring inbyNorth achieving fromofAmerica Mexico manufacturing best-ever Near NorthShoring on-time American in Mexico Asset-light performance Footprint is a strong busines
Slide 21: North American Dedicated Truckload
North American dedicated comes overnight from solutions locations Mexico Truckload Top Complete Deep 20relationships U.S. Provides platform carrier Capacity provides and withtrusted shippers, forproactive Customers provider withtechnology, many throughout with spanning Focus increased the on decades
Slide 22: European Transport
European $425 asset and billion asset-based Transport sector, of Largest model whichOwned –XPO 8,000has Fleet owned lessinthan trucks Europe 1%– share Leading 3,400European trucks European contracted Transport transport through Footprint platform owner-operators Leading providing LTLless-than-truckl
Slide 23: Integrated Cloud-Based IT Platform
Integrated, logistics, rolled America, 2016 Rail enhancing Optimizer Last outomni-channel, developed for Mile upgrades Cloud-Based cross-European system Patented to over on-board rolled aftermarket, IT technology 20Platform years out visibility computers inLess-Than-Truckload 2015 enables Adds etc.
Slide 24: XPO Logistics Financial Performance
XPO Logistics Financial Performance
Slide 25: Rock Solid Financial Strength
Rock SolidApproximately downturn expenditures Financial 25 | Investor Strength 73% Presentation Accelerating of debt will Julynot free 2016 mature cash XPOflow until Logistics –2021 $100ormillion later Long-term to $150 million leverage of free target cash of flow 3 – 4xexpected net debtfor / EBITDA
Slide 26: Free Cash Flow Profile
Free Millions Robinson, Enterprises, 26 | Investor Cash25Flow Echo 1,500 Knight Presentation Profile Global 21.7 Transportation 1,250 Flexible Logistics July20 2016 asset 1,000 and and XPO Expeditors / 15 non-asset Heartland Logistics 11.9 750-775 International; model Express; 10 gives 475-500 RailX
Slide 27: First Quarter 2016 Highlights
Firstby led loss 27 Quarter volume | Investor 2016 growth Presentation Highlights from e-commerce $3.5 July billion 2016 XPO and of gross high Logistics tech, revenue and $249.3 a strongmillion performance of adjusted in Europe EBITDA XPO(1)named 28.3%Fortune transportation 500’s fastest-growing net
Slide 28: Well-Positioned to Manage Through Brexit
Well-Positioned Approximately revenue (1) Basedfrom on annualized U.K. 90% to Manage owned of U.K. EBITDA. fleet Through EBITDA from See Brexit dedicated comes appendix Currency from service: forcontract aFully reconciliation long-term, hedged logistics: cost-plus foreign of long-term adjusted excha
Slide 29: Financial Outlook
Financial Outlook FY 2016: adjusted EBITDA of at least $1.25 billion FY 2018: adjusted EBITDA of at least $1.7 billion The company is solidly on track to achieve its targets 29 | Investor Presentation July 2016 XPO Logistics
Slide 30: XPO Logistics Supplemental Materials
XPO LogisticsMaterials Supplemental
Slide 31: Awards and Recognitions
AwardsDepot French Home improvement among competitive national Ministry and Recognitions transit (2015) Logistics LTL of times; the names carriers Environment dell’Anno billing Inbound XPO for: accuracy; trustworthiness; mid-size Award Logistics and the (2015) truckload and French (2016) claims hono
Slide 32: Business Glossary
Business minimizes support, time-critical, for technology business transportation. capacity destinations worldwide. raw materials, aftermarket provided that Glossary commoditization. that XPO’s within high-value facilitates Insolicits North parts by Contract global North support, anor the bids Ameri
Slide 33: Business Glossary (Cont'd)
Business cost Two Mexico, XPO solutions Than-Truckload the network modes, management, trailer, time Investor freight, business, factors isspecializes either key together that Presentation where Glossary toits but retailers are allows byclaims with commodity not the driving dimension with (LTL): in(C
Slide 34: Financial Reconciliations
Financial Logistics, loss (3.2) Income Other gains administrative ownership attributable —100.0% &depreciation tax losses Reconciliations Inc. of benefit XPO Consolidated expense Other Net to common & (15.7) Logistics loss expense amortization 3.9 Net (13.6) The —100.0% shareholders Reconciliation E
Slide 35: Financial Reconciliations (Cont'd)
Financial Logistics, attributable dividends Loss amortization Direct EBITDA $administrative 2016 81.4on XPO operating 505.8% conversion $Reconciliations (2.8) Inc. Logistics 301.6 toofcommon Consolidated expense Refer (2.9) trade expense $ 56.6 of-3.4% to names convertible 145.2 shareholders the 432
Slide 36: Financial Reconciliations (Cont'd)
Financial operating operating Operating Adjusted Reconciliations ratio income for 52.5 the income same 37.9 (Cont’d) $periods Operating 58.3 $The XPO 37.9 ratio following Adjusted Logistics 93.6%table operating 95.6% North reconciles American Transaction ratio 92.9% XPO’s Less-Than-Truckload & 95.6%