GXO Logistics, Inc. (NYSE: GXO) today announced results for
the third quarter 2024.
Malcolm Wilson, chief executive officer of GXO, said, “We have
increasing momentum in our business. In the third quarter, we
delivered our highest-ever quarterly revenue of $3.2 billion,
reflecting growth of 28% year over year, along with sequential
improvement in organic revenue growth and strong free cash
flow.
“We signed $226 million of new business wins, bringing
year-to-date wins to about $750 million. Our sales pipeline stands
at its highest level in more than two years, and we are on track to
deliver a record year for new business wins in 2024.
“We’re seeing increasing demand for ecommerce capacity. This is
a long-term structural tailwind that has been a key growth driver
for us over the past five years. More than half of our new wins in
the third quarter originated from e-fulfillment, and we also opened
the largest ecommerce warehouse in France, in partnership with one
of our long-term customers.
“Our performance gives us confidence in the acceleration of our
organic growth in 2025 and beyond. GXO is well positioned to
capitalize on the secular supply chain trends of complexity,
ecommerce, automation and outsourcing, and to deliver long-term
profitable growth.”
Third Quarter
2024 Results
Revenue increased to $3.2 billion, up 28% year over year,
compared with $2.5 billion for the third quarter 2023. Organic
revenue1 grew by 3%.
Net income was $35 million, compared with $68 million for the
third quarter 2023. Diluted earnings per share was $0.28, compared
with $0.55 for the third quarter 2023.
Adjusted earnings before interest, taxes, depreciation and
amortization (“adjusted EBITDA1”) was $223 million, compared
with $200 million for the third quarter 2023. Adjusted diluted EPS1
was $0.79, compared with $0.69 for the third quarter 2023.
____________________________
1 For definitions of non-GAAP measures see the “Non-GAAP
Financial Measures” section in this press release.
GXO generated $198 million of cash flow from operations,
compared with $243 million for the third quarter 2023. In the third
quarter of 2024, GXO generated $110 million of free cash flow1,
compared with $191 million of free cash flow1 for the third quarter
2023.
Cash Balances and Outstanding Debt
As of September 30, 2024, cash and cash equivalents
(excluding restricted cash), debt outstanding and net debt1 were
$548 million, $2.8 billion and $2.2 billion, respectively.
Guidance
The company reaffirms its guidance for the full year
20242 as follows:
- Organic revenue
growth1 of 2% to 5%;
- Adjusted EBITDA1 of
$805 million to $835 million;
- Adjusted diluted
EPS1 of $2.73 to $2.93; and
- Adjusted EBITDA1 to
free cash flow1 conversion of 30% to 40%.
Conference Call
GXO will hold a conference call on Tuesday, November 5,
2024, at 8:30 a.m. Eastern Time. Participants can call toll free
(from US/Canada) 877-407-8029; international callers dial +1
201-689-8029. Conference ID: 13749227. A live webcast of the
conference will be available on the Investor Relations area of the
company’s website, investors.gxo.com. The conference will be
archived until November 19, 2024. To access the replay by phone,
call toll-free (from US/Canada) 877-660-6853; international callers
dial +1 201-612-7415. Use participant passcode 13749227.
About GXO Logistics
GXO Logistics, Inc. (NYSE: GXO) is the world’s largest pure-play
contract logistics provider and is capitalizing on the rapid growth
of ecommerce and automation. GXO is committed to providing a
world-class, diverse workplace for more than 130,000 team members
in more than 970 facilities totaling approximately 200 million
square feet. The company partners with the world’s leading
blue-chip companies to solve complex logistics challenges with
technologically advanced supply chain and ecommerce solutions. GXO
is headquartered in Greenwich, Connecticut, USA. Visit
GXO.com for more information and connect with GXO
on
LinkedIn, X, Facebook, Instagram
and YouTube.
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 press release to the most
directly comparable measure under GAAP, which are set forth in the
financial tables below.
GXO’s non-GAAP financial measures in this press release include:
adjusted earnings before interest, taxes, depreciation and
amortization (“adjusted EBITDA”), adjusted EBITDA margin, adjusted
earnings before interest, taxes and amortization (“adjusted
EBITA”), adjusted EBITA, net of income taxes paid, adjusted EBITA
margin, adjusted net income attributable to GXO, adjusted earnings
per share (basic and diluted) (“adjusted EPS”), free cash flow,
free cash flow conversion, organic revenue, organic revenue growth,
net leverage ratio, net debt, and operating return on invested
capital (“ROIC”).
____________________________
2 Our guidance reflects current FX rates.
We believe that the above adjusted financial measures facilitate
analysis of our ongoing business operations because they exclude
items that may not be reflective of, or are unrelated to, GXO’s
core operating performance, and may assist investors with
comparisons to prior periods and assessing trends in our underlying
businesses. Other companies may calculate these non-GAAP financial
measures differently, and therefore our measures may not be
comparable to similarly titled measures used by other companies.
GXO’s non-GAAP financial measures should only be used as
supplemental measures of our operating performance.
Adjusted EBITDA, adjusted EBITA, adjusted net income
attributable to GXO and adjusted EPS include adjustments for
transaction and integration costs, litigation expenses as well as
restructuring costs and other adjustments as set forth in the
financial table below. Transaction and integration adjustments are
generally incremental costs that result from an actual or planned
acquisition, divestiture or spin-off and may include transaction
costs, consulting fees, retention awards, internal salaries and
wages (to the extent the individuals are assigned full-time to
integration and transformation activities), and certain costs
related to integrating and separating IT systems. Litigation
expenses primarily relate to the settlement of ongoing legal
matters. Restructuring costs primarily relate to severance costs
associated with business optimization initiatives.
We believe that adjusted EBITDA, adjusted EBITDA margin,
adjusted EBITA, adjusted EBITA, net of income taxes paid, and
adjusted EBITA margin, improve comparability from period to period
by removing the impact of our capital structure (interest and
financing expenses), asset base (depreciation and amortization of
intangible assets acquired), tax impacts and other adjustments as
set out in the attached tables, which management has determined are
not reflective of core operating activities and thereby assist
investors with assessing trends in our underlying businesses.
We believe that organic revenue and organic revenue growth are
important measures because they exclude the impact of foreign
currency exchange rate fluctuations, revenue from acquired
businesses and revenue from disposed business.
We believe that adjusted net income attributable to GXO and
adjusted EPS improve the comparability of our operating results
from period to period by removing the impact of certain costs and
gains, which management has determined are not reflective of our
core operating activities, including amortization of
acquisition-related intangible assets.
We believe that free cash flow and free cash flow conversion are
important measures of our ability to repay maturing debt or fund
other uses of capital that we believe will enhance stockholder
value. We calculate free cash flow as cash flow from operations
less capital expenditures plus proceeds from sale of property and
equipment. We calculate free cash flow conversion as free cash flow
divided by adjusted EBITDA, expressed as a percentage.
We believe that net debt and net leverage ratio are important
measures of our overall liquidity position and are calculated by
adding bank overdrafts and removing cash and cash equivalents from
our total debt and net debt as a ratio of our adjusted EBITDA. We
calculate ROIC as our trailing twelve months adjusted EBITA, net of
income taxes paid, divided by the average invested capital. We
believe ROIC provides investors with an important perspective on
how effectively GXO deploys capital and use this metric internally
as a high-level target to assess overall performance throughout the
business cycle.
Management uses these non-GAAP financial measures in making
financial, operating and planning decisions and evaluating GXO’s
ongoing performance.
With respect to our financial targets for full-year 2024 organic
revenue growth, adjusted EBITDA, adjusted diluted EPS, and free
cash flow conversion, a reconciliation of these non-GAAP measures
to the corresponding GAAP measures is not available without
unreasonable effort due to the variability and complexity of the
reconciling items described above that we exclude from these
non-GAAP target measures. The variability of these items may have a
significant impact on our future GAAP financial results and, as a
result, we are unable to prepare the forward-looking statements of
income and cash flows prepared in accordance with GAAP, that would
be required to produce such a reconciliation.
Forward-Looking Statements
This press release 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. All statements other than statements of historical fact
are, or may be deemed to be, forward-looking statements, including
the acceleration of our organic revenue growth in 2025 and beyond
and our full-year 2024 guidance. In some cases, forward-looking
statements can be identified by the use of forward-looking terms
such as “anticipate,” “estimate,” “believe,” “continue,” “could,”
“intend,” “may,” “plan,” “potential,” “predict,” “should,” “will,”
“expect,” “objective,” “projection,” “forecast,” “goal,”
“guidance,” “outlook,” “effort,” “target,” “trajectory” or the
negative of these terms or other comparable terms. However, the
absence of these words does not mean that the statements are not
forward-looking. These forward-looking statements are based on
certain assumptions and analyses made by the company in light of
its experience and its perception of historical trends, current
conditions and expected future developments, as well as other
factors the company believes are appropriate in the
circumstances.
These forward-looking statements are subject to known and
unknown risks, uncertainties and assumptions that may cause actual
results, levels of activity, performance or achievements to be
materially different from any future results, levels of activity,
performance or achievements expressed or implied by such
forward-looking statements. Factors that might cause or contribute
to a material difference include, but are not limited to, the risks
discussed in our filings with the SEC and the following: economic
conditions generally; supply chain challenges, including labor
shortages; competition and pricing pressures; our ability to align
our investments in capital assets, including equipment, service
centers and warehouses, to our respective customers’ demands; our
ability to successfully integrate and realize anticipated benefits,
synergies, cost savings and profit improvement opportunities with
respect to acquired companies, including the acquisition of
Wincanton; acquisitions may be unsuccessful or result in other
risks or developments that adversely affect our financial condition
and results; our ability to develop and implement suitable
information technology systems and prevent failures in or breaches
of such systems; our indebtedness; our ability to raise debt and
equity capital; litigation; labor matters, including our ability to
manage its subcontractors, and risks associated with labor disputes
at our customers’ facilities and efforts by labor organizations to
organize its employees; risks associated with defined benefit plans
for our current and former employees; our ability to attract or
retain necessary talent; the increased costs associated with labor;
fluctuations in currency exchange rates; fluctuations in fixed and
floating interest rates; fluctuations in customer confidence and
spending; issues related to our intellectual property rights;
governmental regulation, including environmental laws, trade
compliance laws, as well as changes in international trade policies
and tax regimes; governmental or political actions, including the
United Kingdom’s exit from the European Union; natural disasters,
terrorist attacks or similar incidents; damage to our reputation; a
material disruption of our operations; the inability to achieve the
level of revenue growth, cash generation, cost savings, improvement
in profitability and margins, fiscal discipline, or strengthening
of competitiveness and operations anticipated or targeted; failure
in properly handling the inventory of our customers; the impact of
potential cyber-attacks and information technology or data security
breaches; and the inability to implement technology initiatives or
business systems successfully; our ability to achieve
Environmental, Social and Governance goals; and a determination by
the IRS that the distribution or certain related spin-off
transactions should be treated as taxable transactions. Other
unknown or unpredictable factors could cause actual results to
differ materially from those in the forward-looking statements.
Such forward-looking statements should therefore be construed in
the light of such factors.
All forward-looking statements set forth in this release are
qualified by these cautionary statements and there can be no
assurance that the actual results or developments anticipated by us
will be realized or, even if substantially realized, that they will
have the expected consequences to or effects on us or our business
or operations. Forward-looking statements set forth in this release
speak only as of the date hereof, and we do not undertake any
obligation to update forward-looking statements to reflect
subsequent events or circumstances, changes in expectations or the
occurrence of unanticipated events, except to the extent required
by law.
| Investor
Contact |
| |
| Chris Jordan |
| +1 (203) 769-7228 |
| chris.jordan@gxo.com |
| |
| Media
Contact |
| |
| Matthew Schmidt |
| +1 (203) 307-2809 |
| matt.schmidt@gxo.com |
|
GXO Logistics, Inc. |
|
Condensed Consolidated Statements of
Operations |
|
(Unaudited) |
| |
| |
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
(Dollars in millions, shares in thousands, except per share
amounts) |
|
2024 |
|
2023 |
|
2024 |
|
2023 |
|
Revenue |
|
$ |
3,157 |
|
|
$ |
2,471 |
|
|
$ |
8,459 |
|
|
$ |
7,188 |
|
|
Direct operating expense |
|
|
2,671 |
|
|
|
2,012 |
|
|
|
7,116 |
|
|
|
5,875 |
|
|
Selling, general and administrative expense |
|
|
265 |
|
|
|
258 |
|
|
|
784 |
|
|
|
761 |
|
|
Depreciation and amortization expense |
|
|
111 |
|
|
|
101 |
|
|
|
302 |
|
|
|
268 |
|
|
Transaction and integration costs |
|
|
21 |
|
|
|
3 |
|
|
|
55 |
|
|
|
22 |
|
|
Restructuring costs and other |
|
|
9 |
|
|
|
7 |
|
|
|
26 |
|
|
|
31 |
|
|
Litigation expense (1) |
|
|
(1 |
) |
|
|
— |
|
|
|
59 |
|
|
|
— |
|
| Operating
income |
|
|
81 |
|
|
|
90 |
|
|
|
117 |
|
|
|
231 |
|
|
Other income (expense), net |
|
|
(6 |
) |
|
|
7 |
|
|
|
1 |
|
|
|
8 |
|
|
Interest expense, net |
|
|
(33 |
) |
|
|
(14 |
) |
|
|
(69 |
) |
|
|
(41 |
) |
| Income before income
taxes |
|
|
42 |
|
|
|
83 |
|
|
|
49 |
|
|
|
198 |
|
|
Income tax expense |
|
|
(7 |
) |
|
|
(15 |
) |
|
|
(11 |
) |
|
|
(38 |
) |
| Net
income |
|
|
35 |
|
|
|
68 |
|
|
|
38 |
|
|
|
160 |
|
|
Net income attributable to Noncontrolling Interests (“NCI”) |
|
|
(2 |
) |
|
|
(2 |
) |
|
|
(4 |
) |
|
|
(4 |
) |
| Net income
attributable to GXO |
|
$ |
33 |
|
|
$ |
66 |
|
|
$ |
34 |
|
|
$ |
156 |
|
| |
|
|
|
|
|
|
|
|
| Earnings per
share |
|
|
|
|
|
|
|
|
|
Basic |
|
$ |
0.28 |
|
|
$ |
0.55 |
|
|
$ |
0.28 |
|
|
$ |
1.31 |
|
|
Diluted |
|
$ |
0.28 |
|
|
$ |
0.55 |
|
|
$ |
0.28 |
|
|
$ |
1.31 |
|
| |
|
|
|
|
|
|
|
|
| Weighted-average
common shares outstanding |
|
|
|
|
|
|
|
|
|
Basic |
|
|
119,461 |
|
|
|
118,941 |
|
|
|
119,387 |
|
|
|
118,883 |
|
|
Diluted |
|
|
119,793 |
|
|
|
119,645 |
|
|
|
119,718 |
|
|
|
119,430 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
On June 14,
2024, the Company’s subsidiary GXO Warehouse Company, Inc. entered
into a Confidential Settlement Agreement (the “Settlement
Agreement”) to settle all claims in connection with a dispute
between the Company and one of its customers related to the
start-up of the customer’s warehouse that occurred in 2018 (the
“Dispute”). A payment under the Settlement Agreement was made by
the Company on July 5, 2024. As of July 10, 2024, the Dispute,
which was litigated under the caption Lindt et al. v. GXO Warehouse
Company, Inc., docket no. 4:22-cv-00384-BP, in Federal District
Court for the Western District of Missouri (the “Court”), was
dismissed with prejudice with each side to bear their own costs and
fees, and the Court retained jurisdiction to enforce the terms of
the Settlement Agreement. Among other things in the Settlement
Agreement, the parties each denied the allegations and
counterclaims asserted in the Dispute, and agreed to a mutual
release of claims arising from, under or otherwise in connection
with their prior business relationship and the Dispute, in exchange
for a payment by the Company of $45 million. The Company intends to
pursue reimbursement in connection with this Dispute under its
existing insurance policies. The Company recognized $59 million
expense for the nine months ended September 30, 2024 for the
settlement, associated legal fees, costs and other related
expenses. |
|
GXO Logistics, Inc. |
|
Condensed Consolidated Balance Sheets |
|
(Unaudited) |
| |
| |
|
September 30, |
|
December 31, |
|
(Dollars in millions, shares in thousands, except per share
amounts) |
|
2024 |
|
2023 |
|
ASSETS |
|
|
|
|
| Current
assets |
|
|
|
|
|
Cash and cash equivalents |
|
$ |
548 |
|
|
$ |
468 |
|
|
Accounts receivable, net of allowance of $14 and $11 |
|
|
1,968 |
|
|
|
1,753 |
|
|
Other current assets |
|
|
443 |
|
|
|
347 |
|
|
Total current assets |
|
|
2,959 |
|
|
|
2,568 |
|
| Long-term
assets |
|
|
|
|
|
Property and equipment, net of accumulated depreciation of $1,723
and $1,545 |
|
|
1,161 |
|
|
|
953 |
|
|
Operating lease assets |
|
|
2,501 |
|
|
|
2,201 |
|
|
Goodwill |
|
|
3,676 |
|
|
|
2,891 |
|
|
Intangible assets, net of accumulated amortization of $612 and
$528 |
|
|
1,061 |
|
|
|
567 |
|
|
Other long-term assets |
|
|
542 |
|
|
|
327 |
|
|
Total long-term assets |
|
|
8,941 |
|
|
|
6,939 |
|
|
Total assets |
|
$ |
11,900 |
|
|
$ |
9,507 |
|
| LIABILITIES AND
EQUITY |
|
|
|
|
| Current
liabilities |
|
|
|
|
|
Accounts payable |
|
$ |
748 |
|
|
$ |
709 |
|
|
Accrued expenses |
|
|
1,411 |
|
|
|
966 |
|
|
Current debt |
|
|
223 |
|
|
|
27 |
|
|
Current operating lease liabilities |
|
|
681 |
|
|
|
597 |
|
|
Other current liabilities |
|
|
369 |
|
|
|
327 |
|
|
Total current liabilities |
|
|
3,432 |
|
|
|
2,626 |
|
| Long-term
liabilities |
|
|
|
|
|
Long-term debt |
|
|
2,556 |
|
|
|
1,620 |
|
|
Long-term operating lease liabilities |
|
|
2,067 |
|
|
|
1,842 |
|
|
Other long-term liabilities |
|
|
704 |
|
|
|
473 |
|
|
Total long-term liabilities |
|
|
5,327 |
|
|
|
3,935 |
|
| Commitments and
Contingencies |
|
|
|
|
| Stockholders’
Equity |
|
|
|
|
|
Common Stock, $0.01 par value per share; 300,000 shares authorized,
119,472 and 119,057 issued and outstanding |
|
|
1 |
|
|
|
1 |
|
|
Preferred Stock, $0.01 par value per share; 10,000 shares
authorized, none issued and outstanding |
|
|
— |
|
|
|
— |
|
|
Additional Paid-In Capital (“APIC”) |
|
|
2,620 |
|
|
|
2,598 |
|
|
Retained earnings |
|
|
586 |
|
|
|
552 |
|
|
Accumulated Other Comprehensive Income (Loss) (“AOCIL”) |
|
|
(101 |
) |
|
|
(239 |
) |
|
Total stockholders’ equity before NCI |
|
|
3,106 |
|
|
|
2,912 |
|
|
NCI |
|
|
35 |
|
|
|
34 |
|
|
Total equity |
|
|
3,141 |
|
|
|
2,946 |
|
|
Total liabilities and equity |
|
$ |
11,900 |
|
|
$ |
9,507 |
|
| |
|
|
|
|
|
|
|
|
|
GXO Logistics, Inc. |
|
Condensed Consolidated Statements of Cash
Flows |
|
(Unaudited) |
| |
| |
|
Nine Months Ended September 30, |
| (In
millions) |
|
2024 |
|
2023 |
|
Cash flows from operating activities: |
|
|
|
|
|
Net income |
|
$ |
38 |
|
|
$ |
160 |
|
|
Adjustments to reconcile net income to net cash provided by
operating activities |
|
|
|
|
|
Depreciation and amortization expense |
|
|
302 |
|
|
|
268 |
|
|
Stock-based compensation expense |
|
|
30 |
|
|
|
25 |
|
|
Deferred tax benefit |
|
|
(37 |
) |
|
|
(29 |
) |
|
Other |
|
|
11 |
|
|
|
16 |
|
| Changes in operating
assets and liabilities |
|
|
|
|
|
Accounts receivable |
|
|
50 |
|
|
|
(23 |
) |
|
Other assets |
|
|
(21 |
) |
|
|
(39 |
) |
|
Accounts payable |
|
|
(29 |
) |
|
|
(69 |
) |
|
Accrued expenses and other liabilities |
|
|
19 |
|
|
|
34 |
|
| Net cash provided by
operating activities |
|
|
363 |
|
|
|
343 |
|
| Cash flows from
investing activities: |
|
|
|
|
|
Capital expenditures |
|
|
(255 |
) |
|
|
(205 |
) |
|
Proceeds from sale of property and equipment |
|
|
16 |
|
|
|
13 |
|
|
Acquisition of businesses, net of cash acquired |
|
|
(863 |
) |
|
|
— |
|
|
Cross-currency swap agreements settlement |
|
|
(5 |
) |
|
|
— |
|
| Net cash used in
investing activities |
|
|
(1,107 |
) |
|
|
(192 |
) |
| Cash flows from
financing activities: |
|
|
|
|
|
Proceeds from debt, net |
|
|
1,085 |
|
|
|
— |
|
|
Repayments of debt, net |
|
|
(216 |
) |
|
|
(139 |
) |
|
Repayments of finance lease obligations |
|
|
(32 |
) |
|
|
(24 |
) |
|
Taxes paid related to net share settlement of equity awards |
|
|
(8 |
) |
|
|
(7 |
) |
| Net cash provided by
(used in) financing activities |
|
|
829 |
|
|
|
(170 |
) |
| Effect of exchange rates on
cash and cash equivalents |
|
|
14 |
|
|
|
(2 |
) |
| Net increase
(decrease) in cash, restricted cash and cash
equivalents |
|
|
99 |
|
|
|
(21 |
) |
| Cash, restricted cash
and cash equivalents, beginning of period |
|
|
470 |
|
|
|
495 |
|
| Cash, restricted cash
and cash equivalents, end of period |
|
$ |
569 |
|
|
$ |
474 |
|
| |
|
|
|
|
| Reconciliation of
cash, restricted cash and cash equivalents |
|
|
|
|
|
Cash and cash equivalents |
|
$ |
548 |
|
|
$ |
473 |
|
|
Restricted Cash (included in Other long-term assets) |
|
|
21 |
|
|
|
1 |
|
| Total cash, restricted
cash and cash equivalents |
|
$ |
569 |
|
|
$ |
474 |
|
|
GXO Logistics, Inc. |
|
Key Data |
|
Disaggregation of Revenue |
|
(Unaudited) |
| |
| Revenue
disaggregated by geographical area was as follows: |
| |
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
| (In
millions) |
|
2024 |
|
2023 |
|
2024 |
|
2023 |
|
United Kingdom |
|
$ |
1,525 |
|
$ |
958 |
|
$ |
3,727 |
|
$ |
2,695 |
| United States |
|
|
771 |
|
|
711 |
|
|
2,249 |
|
|
2,117 |
| Netherlands |
|
|
242 |
|
|
216 |
|
|
680 |
|
|
610 |
| France |
|
|
195 |
|
|
207 |
|
|
596 |
|
|
626 |
| Spain |
|
|
147 |
|
|
133 |
|
|
421 |
|
|
396 |
| Italy |
|
|
98 |
|
|
97 |
|
|
288 |
|
|
279 |
| Other |
|
|
179 |
|
|
149 |
|
|
498 |
|
|
465 |
| Total |
|
$ |
3,157 |
|
$ |
2,471 |
|
$ |
8,459 |
|
$ |
7,188 |
| |
| The Company’s
revenue can also be disaggregated by the customer’s primary
industry. Revenue disaggregated by industries was as follows: |
| |
|
Three Months EndedSeptember 30, |
|
Nine Months EndedSeptember 30, |
| (In
millions) |
|
2024 |
|
2023 |
|
2024 |
|
2023 |
|
Omnichannel retail |
|
$ |
1,479 |
|
$ |
1,051 |
|
$ |
3,817 |
|
$ |
3,041 |
| Technology and consumer
electronics |
|
|
392 |
|
|
360 |
|
|
1,137 |
|
|
1,081 |
| Food and beverage |
|
|
344 |
|
|
362 |
|
|
986 |
|
|
1,004 |
| Industrial and
manufacturing |
|
|
376 |
|
|
263 |
|
|
973 |
|
|
803 |
| Consumer packaged goods |
|
|
311 |
|
|
231 |
|
|
896 |
|
|
689 |
| Other |
|
|
255 |
|
|
204 |
|
|
650 |
|
|
570 |
| Total |
|
$ |
3,157 |
|
$ |
2,471 |
|
$ |
8,459 |
|
$ |
7,188 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
GXO Logistics, Inc. |
|
Reconciliation of Net Income to Adjusted
EBITDA |
|
and Adjusted EBITDA Margins |
|
(Unaudited) |
| |
| |
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
Year Ended December 31,
2023 |
|
Trailing Twelve Months
Ended September 30, 2024 |
| (In
millions) |
|
2024 |
|
2023 |
|
2024 |
|
2023 |
|
|
|
Net income attributable to GXO |
|
$ |
33 |
|
|
$ |
66 |
|
|
$ |
34 |
|
|
$ |
156 |
|
|
$ |
229 |
|
|
$ |
107 |
| Net income attributable to
NCI |
|
|
2 |
|
|
|
2 |
|
|
|
4 |
|
|
|
4 |
|
|
|
4 |
|
|
|
4 |
| Net
income |
|
$ |
35 |
|
|
$ |
68 |
|
|
$ |
38 |
|
|
$ |
160 |
|
|
$ |
233 |
|
|
$ |
111 |
| Interest expense, net |
|
|
33 |
|
|
|
14 |
|
|
|
69 |
|
|
|
41 |
|
|
|
53 |
|
|
|
81 |
| Income tax expense |
|
|
7 |
|
|
|
15 |
|
|
|
11 |
|
|
|
38 |
|
|
|
33 |
|
|
|
6 |
| Depreciation and amortization
expense |
|
|
111 |
|
|
|
101 |
|
|
|
302 |
|
|
|
268 |
|
|
|
361 |
|
|
|
395 |
| Transaction and integration
costs |
|
|
21 |
|
|
|
3 |
|
|
|
55 |
|
|
|
22 |
|
|
|
34 |
|
|
|
67 |
| Restructuring costs and
other |
|
|
9 |
|
|
|
7 |
|
|
|
26 |
|
|
|
31 |
|
|
|
32 |
|
|
|
27 |
| Litigation expense |
|
|
(1 |
) |
|
|
— |
|
|
|
59 |
|
|
|
— |
|
|
|
— |
|
|
|
59 |
| Unrealized (gain) loss on
foreign currency contracts and other |
|
|
8 |
|
|
|
(8 |
) |
|
|
4 |
|
|
|
(12 |
) |
|
|
(5 |
) |
|
|
11 |
| Adjusted
EBITDA (1) |
|
$ |
223 |
|
|
$ |
200 |
|
|
$ |
564 |
|
|
$ |
548 |
|
|
$ |
741 |
|
|
$ |
757 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Revenue |
|
$ |
3,157 |
|
|
$ |
2,471 |
|
|
$ |
8,459 |
|
|
$ |
7,188 |
|
|
|
|
|
| Operating
income |
|
$ |
81 |
|
|
$ |
90 |
|
|
$ |
117 |
|
|
$ |
231 |
|
|
|
|
|
| Operating income
margin (2) |
|
|
2.6 |
% |
|
|
3.6 |
% |
|
|
1.4 |
% |
|
|
3.2 |
% |
|
|
|
|
| Adjusted EBITDA
margin (1)(3) |
|
|
7.1 |
% |
|
|
8.1 |
% |
|
|
6.7 |
% |
|
|
7.6 |
% |
|
|
|
|
| |
(1) See the “Non-GAAP Financial Measures” section of this press
release.(2) Operating income margin is calculated as operating
income divided by revenue for the period.(3) Adjusted EBITDA margin
is calculated as adjusted EBITDA divided by revenue for the
period.
|
GXO Logistics, Inc. |
|
Reconciliation of Net Income to Adjusted
EBITA |
|
and Adjusted EBITA Margins |
|
(Unaudited) |
| |
| |
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
Year Ended December 31, 2023 |
|
Trailing Twelve Months Ended September 30,
2024 |
| (In
millions) |
|
2024 |
|
2023 |
|
2024 |
|
2023 |
|
|
|
Net income attributable to GXO |
|
$ |
33 |
|
|
$ |
66 |
|
|
$ |
34 |
|
|
$ |
156 |
|
|
$ |
229 |
|
|
$ |
107 |
| Net income attributable to
NCI |
|
|
2 |
|
|
|
2 |
|
|
|
4 |
|
|
|
4 |
|
|
|
4 |
|
|
|
4 |
| Net
income |
|
$ |
35 |
|
|
$ |
68 |
|
|
$ |
38 |
|
|
$ |
160 |
|
|
$ |
233 |
|
|
$ |
111 |
| Interest expense, net |
|
|
33 |
|
|
|
14 |
|
|
|
69 |
|
|
|
41 |
|
|
|
53 |
|
|
|
81 |
| Income tax expense |
|
|
7 |
|
|
|
15 |
|
|
|
11 |
|
|
|
38 |
|
|
|
33 |
|
|
|
6 |
| Amortization of intangible
assets acquired |
|
|
36 |
|
|
|
18 |
|
|
|
77 |
|
|
|
54 |
|
|
|
71 |
|
|
|
94 |
| Transaction and integration
costs |
|
|
21 |
|
|
|
3 |
|
|
|
55 |
|
|
|
22 |
|
|
|
34 |
|
|
|
67 |
| Restructuring costs and
other |
|
|
9 |
|
|
|
7 |
|
|
|
26 |
|
|
|
31 |
|
|
|
32 |
|
|
|
27 |
| Litigation expense |
|
|
(1 |
) |
|
|
— |
|
|
|
59 |
|
|
|
— |
|
|
|
— |
|
|
|
59 |
| Unrealized (gain) loss on
foreign currency contracts and other |
|
|
8 |
|
|
|
(8 |
) |
|
|
4 |
|
|
|
(12 |
) |
|
|
(5 |
) |
|
|
11 |
| Adjusted
EBITA (1) |
|
$ |
148 |
|
|
$ |
117 |
|
|
$ |
339 |
|
|
$ |
334 |
|
|
$ |
451 |
|
|
$ |
456 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Revenue |
|
$ |
3,157 |
|
|
$ |
2,471 |
|
|
$ |
8,459 |
|
|
$ |
7,188 |
|
|
|
|
|
| Adjusted EBITA
margin (1)(2) |
|
|
4.7 |
% |
|
|
4.7 |
% |
|
|
4.0 |
% |
|
|
4.6 |
% |
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) See the “Non-GAAP Financial Measures” section of this press
release.(2) Adjusted EBITA margin is calculated as adjusted EBITA
divided by revenue for the period.
|
GXO Logistics, Inc. |
|
Reconciliation of Net Income to Adjusted Net
Income |
|
and Adjusted Earnings Per Share |
|
(Unaudited) |
| |
| |
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
(Dollars in millions, shares in thousands, except per share
amounts) |
|
2024 |
|
2023 |
|
2024 |
|
2023 |
|
Net income |
|
$ |
35 |
|
|
$ |
68 |
|
|
$ |
38 |
|
|
$ |
160 |
|
| Net income attributable to
NCI |
|
|
(2 |
) |
|
|
(2 |
) |
|
|
(4 |
) |
|
|
(4 |
) |
| Net income
attributable to GXO |
|
$ |
33 |
|
|
$ |
66 |
|
|
$ |
34 |
|
|
$ |
156 |
|
| Amortization of intangible
assets acquired |
|
|
36 |
|
|
|
18 |
|
|
|
77 |
|
|
|
54 |
|
| Transaction and integration
costs |
|
|
21 |
|
|
|
3 |
|
|
|
55 |
|
|
|
22 |
|
| Restructuring costs and
other |
|
|
9 |
|
|
|
7 |
|
|
|
26 |
|
|
|
31 |
|
| Litigation expense |
|
|
(1 |
) |
|
|
— |
|
|
|
59 |
|
|
|
— |
|
| Unrealized (gain) loss on
foreign currency contracts and other |
|
|
8 |
|
|
|
(8 |
) |
|
|
4 |
|
|
|
(12 |
) |
| Income tax associated with the
adjustments above (1) |
|
|
(11 |
) |
|
|
(4 |
) |
|
|
(40 |
) |
|
|
(21 |
) |
| Discrete tax
benefit (2) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(5 |
) |
| Adjusted net income
attributable to GXO (3) |
|
$ |
95 |
|
|
$ |
82 |
|
|
$ |
215 |
|
|
$ |
225 |
|
| |
|
|
|
|
|
|
|
|
| Adjusted basic
EPS (3) |
|
$ |
0.80 |
|
|
$ |
0.69 |
|
|
$ |
1.80 |
|
|
$ |
1.89 |
|
| Adjusted diluted
EPS (3) |
|
$ |
0.79 |
|
|
$ |
0.69 |
|
|
$ |
1.80 |
|
|
$ |
1.88 |
|
| |
|
|
|
|
|
|
|
|
| Weighted-average
common shares outstanding |
|
|
|
|
|
|
|
|
| Basic |
|
|
119,461 |
|
|
|
118,941 |
|
|
|
119,387 |
|
|
|
118,883 |
|
| Diluted |
|
|
119,793 |
|
|
|
119,645 |
|
|
|
119,718 |
|
|
|
119,430 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) The income tax rate applied to items is based on the GAAP
annual effective tax rate.(2) Discrete tax benefit from intangible
assets and the release of valuation allowances.(3) See the
“Non-GAAP Financial Measures” section of this press release.
|
GXO Logistics, Inc. |
|
Other Reconciliations |
|
(Unaudited) |
| |
| Reconciliation of
Cash Flow from Operations to Free Cash Flow: |
| |
|
Three Months EndedSeptember 30, |
|
Nine Months EndedSeptember 30, |
| (In
millions) |
|
2024 |
|
2023 |
|
2024 |
|
2023 |
|
Cash flow from
operations (1) |
|
$ |
198 |
|
|
$ |
243 |
|
|
$ |
363 |
|
|
$ |
343 |
|
| Capital expenditures |
|
|
(94 |
) |
|
|
(55 |
) |
|
|
(255 |
) |
|
|
(205 |
) |
| Proceeds from sale of property
and equipment |
|
|
6 |
|
|
|
3 |
|
|
|
16 |
|
|
|
13 |
|
| Free cash
flow (2) |
|
$ |
110 |
|
|
$ |
191 |
|
|
$ |
124 |
|
|
$ |
151 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Net cash provided by operating activities.(2) See the
“Non-GAAP Financial Measures” section of this press release.
| Reconciliation of
Revenue to Organic Revenue: |
| |
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
| (In
millions) |
|
2024 |
|
2023 |
|
2024 |
|
2023 |
|
Revenue |
|
$ |
3,157 |
|
|
$ |
2,471 |
|
|
$ |
8,459 |
|
|
$ |
7,188 |
|
| Revenue from acquired
business (1) |
|
|
(591 |
) |
|
|
— |
|
|
|
(1,050 |
) |
|
|
— |
|
| Revenue from disposed
business (1) |
|
|
— |
|
|
|
(3 |
) |
|
|
(1 |
) |
|
|
(10 |
) |
| Foreign exchange rates |
|
|
(35 |
) |
|
|
— |
|
|
|
(85 |
) |
|
|
— |
|
| Organic
revenue (2) |
|
$ |
2,531 |
|
|
$ |
2,468 |
|
|
$ |
7,323 |
|
|
$ |
7,178 |
|
| |
|
|
|
|
|
|
|
|
| Revenue
growth (3) |
|
|
27.8 |
% |
|
|
|
|
17.7 |
% |
|
|
| Organic revenue
growth (2)(4) |
|
|
2.6 |
% |
|
|
|
|
2.0 |
% |
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
(1) The Company excludes revenue from acquired and disposed
businesses for periods that are not comparable.(2) See the
“Non-GAAP Financial Measures” section of this press release.(3)
Revenue growth is calculated as the change in the
period-over-period revenue divided by the prior period, expressed
as a percentage.(4) Organic revenue growth is calculated as the
change in the period-over-period organic revenue divided by the
prior period, expressed as a percentage.
| GXO
Logistics, Inc. |
| Liquidity
Reconciliations |
|
(Unaudited) |
| |
| Reconciliation of Total Debt and Net Debt: |
| (In
millions) |
|
September 30, 2024 |
|
Current debt |
|
$ |
223 |
|
| Long-term debt |
|
|
2,556 |
|
| Total
debt (1) |
|
$ |
2,779 |
|
| Less: Cash and cash
equivalents (excluding restricted cash) |
|
|
(548 |
) |
| Net
debt (2) |
|
$ |
2,231 |
|
| |
|
|
|
|
(1) Includes finance leases and other debt of $316 million as of
September 30, 2024.(2) See the “Non-GAAP Financial Measures”
section of this press release.
| Reconciliation of Total debt to Net income
Ratio: |
| (In
millions) |
|
September 30, 2024 |
|
Total debt |
|
$ |
2,779 |
| Trailing twelve months net
income |
|
$ |
111 |
| Debt to net income
ratio |
|
25.0x |
| Reconciliation of Net Leverage Ratio: |
| (In
millions) |
|
September 30, 2024 |
|
Net debt |
|
$ |
2,231 |
| Trailing twelve months
adjusted EBITDA (1) |
|
$ |
757 |
| Net leverage
ratio (1) |
|
2.9x |
(1) See the “Non-GAAP Financial Measures” section of this press
release.
|
GXO Logistics, Inc. |
|
Return on Invested Capital |
|
(Unaudited) |
| |
| Adjusted EBITA,
net of income taxes paid: |
| |
|
Nine Months Ended September 30, |
|
Year Ended December 31, 2023 |
|
Trailing Twelve Months EndedSeptember
30, 2024 |
| (In
millions) |
|
2024 |
|
2023 |
|
|
|
Adjusted EBITA (1) |
|
$ |
339 |
|
|
$ |
334 |
|
|
$ |
451 |
|
|
$ |
456 |
|
| Less: Cash paid for income
taxes |
|
|
(26 |
) |
|
|
(57 |
) |
|
|
(84 |
) |
|
|
(53 |
) |
| Adjusted EBITA, net of
income taxes paid (1) |
|
$ |
313 |
|
|
$ |
277 |
|
|
$ |
367 |
|
|
$ |
403 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) See the “Non-GAAP Financial Measures” section of this press
release.
| Return on
Invested Capital (ROIC): |
| |
|
September 30, |
|
|
| (In
millions) |
|
2024 |
|
2023 |
|
Average |
|
Selected Assets: |
|
|
|
|
|
|
|
Accounts receivable, net |
|
$ |
1,968 |
|
|
$ |
1,661 |
|
|
$ |
1,815 |
|
|
Other current assets |
|
|
443 |
|
|
|
332 |
|
|
|
388 |
|
|
Property and equipment, net |
|
|
1,161 |
|
|
|
923 |
|
|
|
1,042 |
|
| Selected
Liabilities: |
|
|
|
|
|
|
|
Accounts payable |
|
|
(748 |
) |
|
|
(597 |
) |
|
|
(673 |
) |
|
Accrued expenses |
|
|
(1,411 |
) |
|
|
(975 |
) |
|
|
(1,193 |
) |
|
Other current liabilities |
|
|
(369 |
) |
|
|
(275 |
) |
|
|
(322 |
) |
| Invested
capital |
|
$ |
1,044 |
|
|
$ |
1,069 |
|
|
$ |
1,057 |
|
| |
|
|
|
|
|
|
| Trailing twelve months
net income to average invested
capital |
|
|
|
|
|
|
10.5 |
% |
| Operating return on
invested capital (1)(2) |
|
|
|
|
|
|
38.1 |
% |
| |
|
|
|
|
|
|
|
|
| (1) |
See the
“Non-GAAP Financial Measures” section of this press release. |
| (2) |
The ratio of operating return on invested capital is calculated
as trailing twelve months adjusted EBITA, net of income taxes paid,
divided by the average invested capital. |
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