Xpo, Inc. · NYSE:XPO
Xpo — XPO Logistics — Investor Presentation (May 2013)
24 slides from Xpo's investor presentation, May 8, 2013
Slide 1: Management Presentation May 7, 2013
Management Presentation May 7, 2013 Exhibit 99.1
Slide 2: Disclaimer
Disclaimer This presentation contains, and XPO Logistics, Inc. (the “Company”) may from time to time make, written or oral “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. All
Slide 3: A Large Market Opportunity
A Large Market Opportunity Sources: American Trucking Association, Armstrong & Associates, EVE Partners LLC Worldwide logistics: >$3 trillion U.S. logistics: >$1 trillion U.S. trucking: ~$350 billion U.S. truck brokerage ~$50 billion
Slide 4: Truck Brokerage Growing at 2x to 3x GDP
Truck Brokerage Growing at 2x to 3x GDP Long-term outsourcing trend Brokers add efficiency to both shippers and carriers – Shippers gain access to thousands of carriers – Carriers gain access to millions of loads 85% of shipments are not presently handled by brokers $300 billion untapped opportunity
Slide 5: Brokerage Is a Highly Fragmented Market
Brokerage Is a Highly Fragmented Market More than 10,000 licensed brokers in the U.S. Only about 25 brokers with more than $200 million in revenue Large potential acquisition universe Lack of working capital can motivate sellers Source: Armstrong & Associates
Slide 6: The XPO Growth Strategy
The XPO Growth Strategy On track or ahead of plan with all parts of the strategy Build a multi-billion dollar transportation and logistics service provider – Acquire attractive companies that are highly scalable – Open cold-starts in prime recruitment areas – Significantly scale up and optimize oper
Slide 7: Major Accomplishments in Months
Major Accomplishments in 17 Months Grew footprint to 62 locations Completed seven strategic acquisitions Opened 18 cold-starts, eight of them in freight brokerage Established national operations center Increased overall headcount from 208 to more than 1,000 – Over 790 customer-facing employees – Tar
Slide 8: Major Accomplishments in Months
Major Accomplishments in 17 Months Foundation in place for a much larger company Implemented leading edge training programs Introduced scalable IT platform and three major upgrades Established strategic accounts program Raised $289 million in common stock and convertible debt Dynamic team culture, h
Slide 9: Strategy Part One: Acquisitions
Strategy Part One: Acquisitions Capitalize on attractive acquisition universe Aggressively expand sales force Connect to entire organization via XPO technology Draw on shared capacity Cross-sell services company-wide Gain customers, carriers, lane and pricing histories with each acquisition
Slide 10: Acquired Interide Logistics
Acquired Interide Logistics Acquired May 2013 Highly scalable freight brokerage business TTM revenue of $28 million (3/31/13) Retained owner Sean Snow to grow the operation – Former president of England Logistics Three locations serve diversified customer base – Salt Lake City will become a mega-bra
Slide 11: Acquired Turbo Logistics
Acquired Turbo Logistics Acquired October 2012 28-year-old freight brokerage business TTM revenue of $124 million (9/30/12) Specializes in Fortune 500 customers Locations in Gainesville (Georgia); Reno; Chicago; Dallas Fast growth, led by industry veterans – Retained experienced management
Slide 12: On Track With Acquisitions
On Track With Acquisitions Interide Logistics, freight brokerage (May 2013) Covered Logistics, freight brokerage (Feb. 2013) East Coast Air Charter, air expedited (Feb. 2013) Turbo Logistics, freight brokerage (Oct. 2012) BirdDog Logistics, freight brokerage (Oct. 2012) Kelron Logistics, freight bro
Slide 13: Strategy Part Two: Cold-starts
Strategy Part Two: Cold-starts Opened 18 cold-starts to date – Eight in freight brokerage – Nine in freight forwarding – One in expedite Open branches with strong leaders from the industry Position in prime recruitment areas Scale up rapidly by adding salespeople
Slide 14: Strategy Part Three: Scale and Optimization
Strategy Part Three: Scale and Optimization Rapidly expand sales force with aggressive recruiting and on-boarding, including off-site training Identify branches capable of mega-growth: – Charlotte, North Carolina – Chicago, Illinois – Gainesville, Georgia – Salt Lake City, Utah Drive operational eff
Slide 15: Customers Will Drive Growth
Customers Will Drive Growth $50 billion addressable market and growing Diversified customer base of manufacturing, industrial, retail, commercial, life sciences, government-related Divisional cross-sell to new and existing customers Differentiate as a world-class customer service organization Single
Slide 16: Scalable Technology Platform
Scalable Technology Platform Differentiate XPO through superior technology Purchase transportation more efficiently as data pool grows Introduced proprietary freight optimizer software in 2012 2012 enhancements: advanced load-covering and pricing tools 2013 enhancements to date: new carrier rating e
Slide 17: CEO Bradley S. Jacobs
CEO Bradley S. Jacobs Founded and led four highly successful companies Amerex Oil Associates: Built one of world’s largest oil brokerage firms Hamilton Resources: Grew global oil trading company to ~$1 billion United Waste: Created fifth largest solid waste business in North America United Rentals:
Slide 18: Highly Skilled Management Team
Highly Skilled Management Team Partial list below NCR, Avery Dennison, Arrow Electronics AutoNation, Skadden Arps Oakleaf Waste Management Echo Global Logistics Electrolux, Union Pacific, Odyssey Logistics United Rentals, United Waste Compass Group Goldman Sachs, UBS, JPMorgan Chase C.H. Robinson, K
Slide 19: Financial Overview
Financial Overview
Slide 20: Key Financial Statistics
Key Financial Statistics 2011 revenue of $177 million 2012 revenue of $279 million Currently in excess of $500 million annual revenue run rate Q1 2013 total revenue: $114 million* – up 156% YOY – Freight brokerage: $78.2 million – up 887% – Expedited transportation: $23.9 million – up 6.5% – Freight
Slide 21: 2013 Financial Outlook
2013 Financial Outlook Annual revenue run rate of more than $1 billion as of December 31 At least $300 million of acquired historical annual revenue Positive EBITDA in Q4 2013
Slide 22: Incentivized Management
Incentivized Management Equity ownership aligns management team with shareholders Management and directors own 54% of the company (1) Common Stock Equivalent Capitalization (as of 3/31/13) Common Shares 18.0 million Preferred Shares 10.6 million Warrants (Strike Price $7 per share) 10.7 million (6.3
Slide 23: XPO Logistics
XPOLogistics
Slide 24: Strong Fundamentals for Value Creation
Strong Fundamentals for Value Creation Large, growing, fragmented industry Robust acquisition pipeline Significant growth potential through cold-starts Well-defined process to scale up operations Passionate, world-class culture of customer service