Gxo Logistics, Inc. · NYSE:GXO
Gxo Logistics — Q1 2022 Earnings Presentation
29 slides from Gxo Logistics's earnings presentation, May 4, 2022
Slide 1: First Quarter 2022 Results
GXO Logistics First Quarter 2022 Results May 4, 2022 ©2022 GXO Logistics, Inc.
Slide 2: Disclaimer
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 financial tab
Slide 3: Presenters
Presenters Malcolm Wilson Chief Executive Officer Baris Oran Chief Financial Officer Mark Manduca Chief Investment Officer ©2022 GXO Logistics, Inc. ©2021 3
Slide 4: 1Q 2022 highlights
14% revenue growth, 19% FY 2022 organic revenue 1Q 2022 • • organic revenue growth in 1Q, growth guidance raised to the fifth consecutive quarter of 11-15%, from 8-12%** double-digit organic growth** highlights • Diluted EPS growth of 167%, adjusted diluted EPS** growth of 59% YoY in 1Q • Guidance o
Slide 5: 1Q 2022 financial highlights
1Q 2022 financial highlights Revenue $2.1 billion Organic revenue growth** 19% Net income* $37 million Diluted EPS growth 167% Adjusted diluted EPS growth** 59% Adjusted EBITDA** $155 million *Net income attributable to GXO ©2022 GXO Logistics, Inc. **Refer to the ‘Non-GAAP Financial Measures’ secti
Slide 6: FY 2022 guidance raised
FY 2022 guidance raised PRIOR NOW Organic revenue growth** 8% - 12% 11% - 15% Adjusted $707 - $742 $707 - $742 EBITDA** million million Adjusted $1.5 - $1.6 $1.5 - $1.6 EBITDAR*** billion billion Adjusted diluted EPS** n/a $2.70-$2.90* *Excludes potential issuance of shares related to the acquisitio
Slide 7: 1Q 2022: Sources of revenue growth
1Q 2022: Sources of revenue growth 1Q 2022 revenue bridge 1Q 2021 Revenue Organic growth FX 1Q 2022 Revenue 14% 19% Organic 0% M&A (5)% FX Revenue growth ©2022 GXO Logistics, Inc. 7
Slide 8: Recent wins and expansions
Recent wins and expansions ©2022 GXO Logistics, Inc. 8
Slide 9: New wins and increased contract scope with existing customers
New wins and increased contract $2 billion scope with existing customers in lifetime contract value won in 1Q 2022 1Q new business wins > $1 billion of expected incremental FY 2022 400 ($m annualized revenue) revenue signed through 1Q 2022 350 300 New wins through 1Q 2022 to add 250 $217 million 200
Slide 10: New contract wins underpin 2022 revenue growth and beyond
New contract wins underpin 2022 revenue growth and beyond Incremental 2022 revenue from contract wins Incremental 2023 revenue from contract wins $1,200 $1,022 million $250 $217 million $1,000 $200 $800 $150 $600 $100 $400 $200 $50 $0 $0 Prior Q1 2021 Q2 2021 Q3 2021 Q4 2021 Q1 2022 FY 2022 Q1 2021
Slide 11: Record-breaking revenue driven by contract wins
Record-breaking revenue driven by contract wins 17% 1Q 2022 new business wins First Outsourcing 44% New Activity Won from Competitor 39% ©2022 GXO Logistics, Inc. 11
Slide 12: Sales pipeline: 20% growth YoY
Sales pipeline: Pipeline by vertical 20% growth YoY E-commerce, omnichannel Pipeline growth retail & consumer 70% 2600 technology 2500 $2.5 billion 2400 Food & beverage 10% 2300 2200 Consumer packaged 2100 goods 6% 2000 1900 1800 Industrial & other 14% 1Q 2021 1Q 2022 ©2022 GXO Logistics, Inc. 1212
Slide 13: Accelerating automation and technology leadership
Accelerating automation and technology leadership ~30% of 1Q 2022 revenue is from automated sites >200 new technologies piloted in 1Q 2022 Total technology and Goods-to-person Vision tech automated systems systems Cobots ©2022 GXO Logistics, Inc. 13
Slide 14: High earnings and cash flow visibility
High earnings and High revenue visibility $2.5 billion sales pipeline cash flow visibility • • $1 billion of revenues won to start in 2022 • >15-year average large customer relationships • ~5-year average contract duration • Mid-to-high 90s revenue retention rate since spin 24% Predictable income st
Slide 15: 1Q 2022: Solid profit growth
1Q 2022: Solid profit growth (In millions USD) Net Income* Adjusted EBITDA** $40 $158 $35 $156 $154 $30 $152 $25 $150 $148 $20 $146 $15 $144 $10 $142 $140 $5 $138 $0 $136 1Q 2021 1Q 2022 1Q 2021*** 1Q 2022 *Net income attributable to GXO ** Refer to the ‘Non-GAAP Financial Measures’ section on slide
Slide 16: 1Q 2022: Start-up investment to drive 2H margins
1Q 2022: Start-up investment to drive 2H margins 1Q 2022 Adjusted EBITDA* margin +0.3% -0.7% 7.8% 7.4% 1Q 2021** Performance improvements and other New business start-ups 1Q 2022 *Refer to the ‘Non-GAAP Financial Measures’ section on slide 2 and Appendix for related information ©2022 ©2022 GXO GXO L
Slide 17: 1Q 2022 – Free cash flow reflects normal seasonality
1Q 2022 – Free cash flow reflects normal seasonality Cash flow from operations $46 million (1Q 2021: $47 million) Free cash flow* ($16) million (1Q 2021: ($20) million) ~50% of capex is technology investment in last twelve months ©2022 GXO Logistics, Inc. *Refer to the ‘Non-GAAP Financial Measures’
Slide 18: 1Q 2022 Balance sheet
Total debt*: $939 million 1Q 2022 Net debt: $627 million Balance 1.0x net debt to LTM adjusted EBITDA** sheet Commitment to maintaining investment grade rating *Includes finance leases of $146 million at March 31, 2022 ©2022 GXO Logistics, Inc. **Refer to the ‘Non-GAAP Financial Measures’ section on
Slide 19: GXO on track to reach environmental targets
GXO on track to reach environmental targets GXO’s environmental targets E Social S 2021: LED • Appointment of Letitia King James to lead Diversity, penetration at 47% Inclusion and Belonging • Automated sites see higher staff retention • ~2x increase in women’s representation at VP level and above s
Slide 20: FY 2022 guidance raised
FY 2022 guidance raised Organic revenue 11% - 15% Depreciation and $260 - $280 million growth* (from 8-12%) amortization** Adjusted EBITDA* $707 - $742 million ~ $25 million (unchanged) Interest expense Adjusted EBITDAR*** $1.5 - $1.6 billion Tax rate ~ 25% (unchanged) $2.70-$2.90**** Net capital Ad
Slide 21: Appendix
Appendix ©2022 GXO Logistics, Inc. 21
Slide 22: 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) Three Months Ended March 31, (In millions) 2022 2021 2021 (Pro forma)(1) Net income attributable to GXO $ 37 $ 14 $ 18 Net income attributable to noncontrolling interests 1 3 3 Net income $ 38
Slide 23: Reconciliation of Net Income to Adjusted EBITA and Adjusted EBITA margin
GXO Logistics, Inc. Reconciliation of Net Income to Adjusted EBITA and Adjusted EBITA margin (Unaudited) Three Months Ended March 31, (In millions) 2022 2021 2021 (Pro forma)(1) Net income attributable to GXO $ 37 $ 14 $ 18 Net income attributable to noncontrolling interests 1 3 3 Net income $ 38 $
Slide 24: Reconciliation of Net Income to Adjusted Net Income and Adjusted Net Income Per Share
GXO Logistics, Inc. Reconciliation of Net Income to Adjusted Net Income and Adjusted Net Income Per Share (Unaudited) Three Months Ended March 31, (Dollars in millions, shares in thousands, except per share amounts) 2022 2021 Net income attributable to GXO $ 37 $ 14 Amortization expense 14 14 Transa
Slide 25: Other Reconciliations: Free Cash Flow and Organic Revenue
GXO Logistics, Inc. Other Reconciliations (Unaudited) Reconciliation of Cash Flows from Operating Activities to Free Cash Flow: Three Months Ended March 31, (In millions) 2022 2021 Net cash provided by operating activities $ 46 $ 47 Payment for purchases of property and equipment (65) (67) Proceeds
Slide 26: Liquidity Reconciliations
GXO Logistics, Inc. Liquidity Reconciliations (Unaudited) Reconciliation of Net Debt: March 31, (In millions) 2022 Shor-term debt $ 32 Long-term debt 907 Total Debt $ 939 Less: Cash and cash equivalents 312 Net debt $ 627 Reconciliation of Net Leverage: March 31, (In millions) 2022 Net debt $ 627 Tr
Slide 27: Reconciliation of Net Income to Trailing Twelve Months Adjusted EBITDA
GXO Logistics, Inc. Reconciliation of Net Income to Trailing Twelve Months Adjusted EBITDA (Unaudited) Trailing Twelve Year Ended Months Ended Three Months Ended March 31, December 31, March 31, (In millions) 2022 2021 2021 2022 Net income attributable to GXO $ 37 $ 14 $ 153 $ 176 Net income attribu
Slide 28: Return on Invested Capital
GXO Logistics, Inc. Return on Invested Capital (Unaudited) Trailing Twelve Year Ended Months Ended Three Months Ended March 31, December 31, December 31, (In millions) 2022 2021 2021 2022 (Pro forma)(1) Adjusted EBITA(1)(2) $ 93 $ 84 $ 374 $ 383 Cash paid for income taxes (5) (6) (75) (74) Adjusted
Slide 29: Reconciliation of Net Income to Trailing Twelve Months Pro forma Adjusted EBITA
GXO Logistics, Inc. Reconciliation of Net Income to Trailing Twelve Months Pro forma Adjusted EBITA (Unaudited) Trailing Twelve Year Ended Months Ended Three Months Ended March 31, December 31, March 31, (In millions) 2022 2021 2021 2022 (Pro forma)(1) Net income attributable to GXO $ 37 $ 18 $ 162