Slide 1: Fourth Quarter 2024 Results
Fourth Quarter 2024 Results February 5, 2025
Slide 2: Non-GAAP financial measures and forward-looking statements
Non-GAAP financial measures and forward-looking statements Non-GAAP financial measures 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 tables attached to this present
Slide 3: Q4 2024 highlights
Q4 2024 highlights 1 Coyote integration remains ahead of schedule; raising cost synergy estimate 2 Double-digit sequential volume growth in Brokerage 3 Managed Transportation sales pipeline continues to grow 4 Last Mile year-over-year stop growth accelerated 5 Brokerage market tightened throughout t
Slide 4: As reported fourth-quarter financial results
As reported fourth-quarter financial results 1 Revenue Gross margin $ and % Adjusted EBITDA and margin % 2 $42M $1,667M $258M $31M $978M $176M 18.0% 15.5% 3.2% 2.5% Q4 23 Q4 24 Q4 23 Q4 24 Q4 23 Q4 24 RXO delivered Q4 2024 adjusted EBITDA in-line with guidance 1 Q4 2023 revenue, gross margin and adj
Slide 5: Diversified portfolio with momentum in complementary services
Diversified portfolio with momentum in complementary services Brokerage (combined) Q4 revenue by service offering 1 • Volume: Up 10% q/q, down 6% y/y – LTL: Up 1% y/y, 18% of volume – Full truckload: Down 8% y/y, 82% of volume 8% Truck Brokerage • Truckload volume mix: 76% contract, 24% spot 17% • G
Slide 6: Coyote integration update
Coyote integration update People / Operations Technology Synergies • Continuing to retain key talent • Significant progress with • Raising cost synergy estimate RXO Connect® as primary system and now expect at least $50M • Expanded service offerings and larger scale resulting in significant – Migrat
Slide 7: Adjusted EPS bridge
Adjusted EPS bridge Earnings per share Q4-24 Q4-23 GAAP diluted EPS $(0.12) $0.02 Amortization of intangible assets 0.10 0.03 Transaction, integration and restructuring costs 0.20 0.03 Tax associated with adjustments above and discrete tax item (0.12) (0.02) 1 Adjusted diluted EPS $0.06 $0.06 2 RXO
Slide 8: Trailing three month adjusted free cash flow walk
Trailing three month adjusted free cash flow walk 1 1 Three month adjusted free cash flow • Trailing 3-month RXO adjusted free cash flow represented a 14% conversion – Cash flow in the quarter lower due to semi- annual interest payment – Conversion also impacted by lower profitability at the bottom
Slide 9: Capital structure snapshot
Capital structure snapshot Capital structure Q4 2024 Notes due 2027 $ 355 1,2,3 Finance leases, asset financing, ST debt & other 33 LTM leverage Total debt, principal balance & other $ 388 1.7x 1.6x Less: cash 35 1 Net debt $ 353 Committed liquidity Q4 2024 Cash $ 35 Gross Net Revolver 600 Total cap
Slide 10: Brokerage truckload revenue per load and gross margin trends
Brokerage truckload revenue per load and gross margin trends 48% 47% • Q4 truckload revenue per load flat y/y 45% Includes the impact of Coyote – Excludes the impact of changes in fuel prices and length of haul 23% 21% 12% • Revenue per load trends have improved to 6% 1% 0% start the year -1% -4% -4
Slide 11: Monthly gross margin trends and market update
Monthly gross margin trends and market update Market conditions tightened significantly • Load-to-truck ratio and industry-wide tender rejections moved higher • Capacity-driven market tightening with continued carrier exits • Demand trends remained soft with another muted peak season • Brokerage GM
Slide 12: Full truckload volume and gross profit per load trends
Full truckload volume and gross profit per load trends 1 With the acquisition of Coyote, full truckload volume increased by >125% 1 All periods prior to Q4 2024 exclude the impact of the Coyote Logistics acquisition. 12
Slide 13: LTL volume and gross profit per load trends
LTL volume and gross profit per load trends 1 LTL brokerage volume is growing with stable gross profit per load 1 All periods prior to Q4 2024 exclude the impact of the Coyote Logistics acquisition. 13
Slide 14: Outlook and modeling assumptions
Outlook and modeling assumptions 1 Q1 2025 outlook • Adjusted EBITDA : $20M-$30M 2 • Brokerage y/y volume (combined) : Down mid-to-high single-digit % • Brokerage gross margin: 12%-14% 2 FY 2025 • Brokerage y/y volume growth (combined) modeling assumptions • Capital expenditures: $75M-$85M – Include
Slide 15: Key investment highlights
Key investment highlights 1 Large addressable market with secular tailwinds 5 Market-leading platform with complementary transportation solutions 2 Track record of above-market growth and high profitability 6 Tiered approach to sales drives multi-faceted growth opportunities 3 Proprietary technology
Slide 16: Appendix
Appendix RXO
Slide 17: Financial reconciliations
Financial reconciliations Reconciliation of net income (loss) to adjusted EBITDA and adjusted EBITDA margin Three Months Ended December 31, Years Ended December 31, (Dollars in millions) 2024 2023 2024 2023 Net income (loss) $ (20) $ 2 $ (285) $ 4 Interest expense, net 8 8 30 32 Income tax provision
Slide 18: Financial reconciliations (cont.)
Financial reconciliations (cont.) Reconciliation of net income (loss) to adjusted net income and adjusted diluted earnings per share Three Months Ended December 31, Years Ended December 31, (Dollars in millions, shares in thousands, except per share amounts) 2024 2023 2024 2023 Net income (loss) $ (
Slide 19: Financial reconciliations (cont.)
Financial reconciliations (cont.) Reconciliation of cash flows from operating activities to free cash flow and adjusted free cash flow Three Months Ended Nine Months Ended December 31, Years Ended December 31, September 30, (Dollars in millions) 2024 6 2024 2023 2024 Net cash provided by (used in) o
Slide 20: Financial reconciliations (cont.)
Financial reconciliations (cont.) Calculation of gross margin and gross margin as a percentage of revenue Three Months Ended Years Ended December 31, December 31, (Dollars in millions) 2024 2023 2024 2023 Revenue Truck brokerage $ 1,267 $ 610 $ 3,029 $ 2,358 1 Complementary services 431 411 1,655 1,
Slide 21: Financial reconciliations (cont.)
Financial reconciliations (cont.) Reconciliation of bank-adjusted EBITDA; Calculation of gross and net leverage December 31, (Dollars in millions) 2024 Reconciliation of bank-adjusted EBITDA Adjusted EBITDA 1, 2 for the year ended December 31, 2024 $ 118 Adjustments per credit agreement 3 for the ye
Slide 22: RXO
RXO