Gxo Logistics, Inc. · NYSE:GXO
Gxo Logistics — Q2 2023 Earnings Presentation
22 slides from Gxo Logistics's earnings presentation, Aug 3, 2023
Slide 1: Second Quarter 2023 Results
Second Quarter 2023 Results August 2, 2023 ©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 Baris Oran Mark Manduca Bill Fraine Chief Executive Officer Chief Financial Officer Chief Investment Officer Chief Commercial Officer ©GXO Logistics, Inc. 3
Slide 4: Highlights
Highlights 2Q 2023 • New business wins in 2Q 2023 expected Revenue $2.4 billion to generate $497 million of annualized revenue(3). • $844 million of new FY 2023 revenue won Organic revenue growth(1) 3% through 2Q 2023, equivalent to 9% YoY revenue growth(4). • $457 million of new FY 2024 revenue won
Slide 5: 2Q 2023: Double-digit revenue growth
2Q 2023: Double-digit revenue growth (In millions USD) $3,000 ~11% Revenue growth ~7% ~1% $2,500 ~3% M&A FX $2,394 Organic(1) $2,156 $2,000 $1,500 $1,000 $500 $0 2Q 2022 Revenue Organic growth M&A FX 2Q 2023 Revenue (1) Refer to the ‘Non-GAAP Financial Measures’ section on slide 2 and Appendix for r
Slide 6: 2Q 2023: Strong profit growth
2Q 2023: Strong profit growth (In millions USD) Net income(1) Adjusted EBITDA(2) $80 $200 $190 $70 $180 $176 $65 $160 $60 $140 $51 $50 $120 $40 $100 $30 $80 $60 $20 $40 $10 $20 $0 $0 2Q 2022 2Q 2023 2Q 2022 2Q 2023 (1) Net Income attributable to GXO. (2) Refer to the ‘Non-GAAP Financial Measures’ se
Slide 7: Recent wins and expansions
Recent wins and expansions ©GXO Logistics, Inc. 7
Slide 8: Record new contract wins underpin 2023 and 2024 revenue growth
Record new contract wins underpin 2023 and 2024 revenue growth (In millions USD) Expected 2023 gross revenue from contract wins Expected 2024 gross revenue from contract wins $457(2) $500 million $844(1) million $450 $900 $400 $800 $350 $700 $300 $600 $500 $250 $400 $200 $300 $150 $200 $100 $100 $50
Slide 9: 2Q 2023 contract wins by source
2Q 2023 contract wins by source 70% 19% New Won from outsourcing competitors 11% New activity New outsourcing New activity Won from competitor ©GXO Logistics, Inc. 9
Slide 10: Diversified revenue in 2Q 2023
Diversified revenue in 2Q 2023 7% Other 43% Omnichannel 10% retail Consumer packaged goods 11% Industrial and manufacturing 14% Food and beverage 15% Technology and consumer electronics ©GXO Logistics, Inc. 10
Slide 11: Accelerating automation and adaptive technology leadership
Accelerating automation and adaptive technology leadership Total technology and Goods-to-person systems Cobots Vision tech automated systems +65% +38% +81% +96% 2Q 2022 2Q 2023 2Q 2022 2Q 2023 2Q 2022 2Q 2023 2Q 2022 2Q 2023 ~4,000 more adaptive technology systems deployed year over year; ~30% of 2Q
Slide 12: High-quality growth: Diversified, contracted, blue chip
High-quality growth: Diversified, contracted, blue chip Resilient, Pricing driven Diversified Blue-chip, duration-matched by contractual verticals, customers investment-grade contractual relationships, not and geographies customer base relationships supply/demand $457 million ~5-year No customer ~45
Slide 13: Balance sheet and free cash flow
Balance sheet and free cash flow Balance sheet Cash flow Total debt(1) Reduced debt by $146 million Cash flow from operations in 2023 $61 million $1,660 million 2Q 2022: $154 million Net debt(2) Mostly fixed-rate borrowings Free cash flow(2) $1,355 million $3 million 2Q 2022: $68 million Net leverag
Slide 14: Environmental & economic benefits
Environmental goals Q2 Highlights: Environmental • Reduce our environmental impact − 80% global operations using LED lighting by 2025 − 80% global landfill diversion rate by 2025 − 50% renewably sourced energy by 2030 − 30% GHG emissions (scopes 1 & 2) reduction by 2030 & economic benefits − 100% ca
Slide 15: Updated FY 2023 guidance
Updated FY 2023 guidance(1) Current Prior Organic revenue 6% – 8% 6% – 8% growth(2) Adjusted EBITDA(2) $725 – $755 $715 – $745 million million Adjusted EBITDA(2) ~30% ~30% to free cash flow conversion Adjusted diluted EPS(2) $2.45 – $2.65 $2.40 – $2.60 Adjusted EBITDAR(3) $1.75 – $1.80 $1.70 – $1.75
Slide 16: Appendix
Appendix
Slide 17: Reconciliation of Net Income to Adjusted EBITDA and Adjusted EBITA
GXO Logistics, Inc. Reconciliation of Net Income to Adjusted EBITDA and Adjusted EBITA and Adjusted EBITDA and Adjusted EBITA Margins (Unaudited) Trailing twelve months Three months ended June 30, Six months ended June 30, Year ended ended December June 30, (In millions USD) 2023 2022 2023 2022 31,
Slide 18: Reconciliation of Net Income to Adjusted Net Income and Adjusted EPS
GXO Logistics, Inc. Reconciliation of Net Income to Adjusted Net Income and Adjusted Earnings Per Share (Unaudited) Three months ended June 30, Six months ended June 30, (Dollars in millions, shares in thousands, except per share amounts) 2023 2022 2023 2022 Net income attributable to GXO $ 65 $ 51
Slide 19: Other Reconciliations: Free Cash Flow
GXO Logistics, Inc. Other Reconciliations (Unaudited) Reconciliation of cash flows from operating activities to free cash flow: Three months ended June 30, Six months ended June 30, (In millions USD) 2023 2022 2023 2022 Net cash provided by operating activities $ 61 $ 154 $ 100 $ 200 Payment for pur
Slide 20: Other Reconciliations: Organic Revenue
GXO Logistics, Inc. Other Reconciliations (Unaudited) Reconciliation of revenue to organic revenue: Three months ended June 30, Six months ended June 30, (In millions USD) 2023 2022 2023 2022 Revenue $ 2,394 $ 2,156 $ 4,717 $ 4,239 Revenue from acquired business(1) (154) — (378) — Revenue from decon
Slide 21: Liquidity Reconciliations
GXO Logistics, Inc. Liquidity Reconciliations (Unaudited) Reconciliation of total debt and net debt: (In millions USD) June 30, 2023 Current debt $ 35 Long-term debt 1,625 Total debt $ 1,660 Less: Cash and cash equivalents (305) Net debt(1) $ 1,355 Reconciliation of total debt to net income attribut
Slide 22: Return on Invested Capital
GXO Logistics, Inc. Return on Invested Capital (Unaudited) Adjusted EBITA, net of income taxes paid Year ended Trailing twelve Six months ended June 30, December 31, months ended (In millions USD) 2023 2022 2022 June 30, 2023 Adjusted EBITA(1) $ 217 $ 205 $ 467 $ 479 Less: Cash paid for income taxes