Slide 1: Investor Overview Q1 2024
Investor Overview Q1 2024 May 2024
Slide 2: Forward-looking statements
Forward-looking statements This document includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including statements relating to our full year 2024 expectations of gross cape
Slide 3: First quarter 2024 highlights
First quarter 2024 highlights $2.02 billion of revenue, up 6% YoY $288 million of adjusted EBITDA, up 37% YoY $0.81 of adjusted diluted EPS1, up 45% YoY LTL adjusted operating income of $175 million, up 50% YoY LTL adjusted operating ratio of 85.7%, improving by 390 bps YoY LTL tonnage per day up 2.
Slide 4: First quarter 2024 performance
First quarter 2024 performance REVENUE $2.02 billion BY SEGMENT OPERATING INCOME $138 million NORTH AMERICAN LTL NET INCOME $67 million REVENUE $1.22 billion DILUTED EARNINGS PER SHARE $0.56 ADJUSTED EBITDA $255 million ADJUSTED NET INCOME $97 million ADJUSTED OPERATING RATIO 85.7% ADJUSTED DILUTED
Slide 5: Four pillars of LTL 2.0 plan driving significant margin and earnings expansion
Four pillars of LTL 2.0 plan driving significant margin and earnings expansion 1 Provide best-in- 2 Invest in network 3 Accelerate yield 4 Drive cost class service for the long-term growth efficiencies Targets for LTL Growth, Profitability and Efficiency, 2021-2027 Revenue CAGR of 6% to 8% Adjusted
Slide 6: Strong position in North American LTL
Strong position in North American LTL 6
Slide 7: A leading carrier in a compelling industry
A leading carrier in a compelling industry 5% CAGR: North American LTL industry revenue • $52 billion bedrock industry for the US economy, with nearly 75% of share held by top 10 LTL players • Diverse demand across verticals, with secular growth drivers • Attractive pricing environment, with industr
Slide 8: A major player in the supply-chain ecosystem
A major player in the supply-chain ecosystem $4.7 billion 9% 3rd largest 12.4% 2023 revenue 2023 industry share LTL carrier by 2023 revenue 2023 revenue allocated to gross capex 33,000 650 million 13 million 18 billion customers served linehaul miles run shipments per year pounds of freight per year
Slide 9: Expansive network covering 99% of US zip codes
Expansive network covering 99% of US zip codes Service Centers Acquired Service Centers1 • 293 service centers • 28 additional service centers acquired • Cross-border and offshore capabilities • Strategic investments in high-demand markets 1 Indicates planned expansion of footprint with 28 service c
Slide 10: Strategic mix of blue-chip and local customers
Strategic mix of blue-chip and local customers 33,000 customers 2.9% revenue from largest customer, low concentration risk 16-year average tenure of top 10 customers Note: Company data for North American LTL segment only as of March 31, 2024; selected customers of XPO 10
Slide 11: LTL 2.0 growth plan and levers
LTL 2.0 growth plan and levers 11
Slide 12: Executing on four pillars of LTL 2.0 plan
Executing on four pillars of LTL 2.0 plan • Building a customer-centric service organization Provide best-in-class • Incentivizing employees to drive service quality service • Investing in new tools for field organization and enhancing training programs • Targeting capex of 8% to 12% of revenue on a
Slide 13: Delivering meaningful service improvements
Delivering meaningful service improvements Damage claims declining as a % of LTL revenue1 1.2% 1.2% LTL 2.0 1.1% 1.1% 1.1% 1.0% 1.0% 0.9% 0.9% 0.9% 0.9% 0.7% 0.7% 0.6% 0.4% 0.3% 0.3% Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 Q3 2021 Q4 2021 Q1 2022 Q2 2022 Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q3 20
Slide 14: Investing in high-return growth levers
Investing in high-return growth levers LTL 2.0 $800 14.0% 12.4% 12.0% $581 $600 Gross capex as a % of revenue 9.1% 10.0% Gross capex ($ millions) $424 8.0% $400 5.2% 6.0% 4.8% 3.8% 4.1% $197 $197 4.0% $200 $145 $145 2.0% $- 0.0% 1 2018 2019 2020 2021 2022 2023 Tractor age in years As of December 31
Slide 15: Earning price by delivering value through service excellence
Earning price by delivering value through service excellence Gross revenue per hundredweight (excluding fuel surcharges) LTL 2.0 $23.37 $23.13 $22.81 $21.63 $21.34 $21.43 $21.19 $21.06 $20.90 $20.76 $20.02 $19.29 $19.11 $18.90 $18.82 $18.34 $18.45 Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 Q3 2
Slide 16: Insourcing linehaul is a key cost and service opportunity
Insourcing linehaul is a key cost and service opportunity Linehaul miles outsourced to third-party carriers, as a % of total linehaul miles 25.7% LTL 2.0 25.5% 25.3% 24.5% 24.7% 24.4% 23.8% 23.9% 23.6% 23.5% 22.7% 22.5% 21.8% 21.5% 20.7% 19.6% 18.1% Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 Q3
Slide 17: 11% to 13% adjusted EBITDA CAGR in North American LTL 2021-2027
11% to 13% adjusted EBITDA CAGR in North American LTL 2021-2027 Expected components and contributions Combination of volume gains + pricing over inflation 6% to 7% Operating costs optimized through technology 3% to 4% Linehaul insourced from third parties 2% 11% to 13% 17
Slide 18: Appendix
Appendix 18
Slide 19: European Transportation segment
European Transportation segment Unique pan-European transportation platform holds leading positions in key geographies • In France: the #1 full truckload (FTL) broker and the #1 pallet network (LTL) provider • In Iberia (Spain and Portugal): the #1 FTL broker and the #1 LTL provider • In the UK: a t
Slide 20: 2024 planning assumptions
2024 planning assumptions For the full year 2024, the company expects: • Gross capex of $700 million to $800 million • Interest expense of $240 million to $260 million • Pension income of approximately $25 million • Adjusted effective tax rate of 23% to 25% • Diluted share count of 121 million Refer
Slide 21: Financial reconciliations
Financial reconciliations The following table reconciles XPO’s net income from continuing operations for the periods ended March 31, 2024 and 2023 to adjusted EBITDA for the same periods. Reconciliation of net income from continuing operations to adjusted EBITDA $ in millions Three Months Ended Marc
Slide 22: Financial reconciliations (cont.)
Financial reconciliations (cont.) The following table reconciles XPO’s net income from continuing operations for the periods ended March 31, 2024 and 2023 to adjusted net income from continuing operations for the same periods. Reconciliation of adjusted net income and adjusted diluted earnings per s
Slide 23: Financial reconciliations (cont.)
Financial reconciliations (cont.) The following table reconciles XPO’s operating income attributable to its North American less-than-truckload (LTL) segment for the periods ended March 31, 2024 and 2023 to adjusted operating income, adjusted operating ratio and adjusted EBITDA. Reconciliation of Nor
Slide 24: Non-GAAP financial measures
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 document to the most directly comparable measure under GAAP, which are set forth in the financial tables attached to