XPO (NYSE: XPO) today announced its financial
results for the first quarter 2023. Revenue increased to $1.91
billion for the quarter, compared with $1.89 billion for the same
period in 2022.
Mario Harik, chief executive officer of XPO,
said, “We delivered a solid quarter in a challenging environment
for freight transportation, reporting 22% growth in adjusted
diluted EPS and 14% growth in adjusted EBITDA.”
“In North American LTL, we grew year-over-year
shipments per day in the quarter, and achieved more growth in April
versus March, outperforming seasonality. Demand remains soft, with
a negative impact on tonnage, but we’re actively reducing our
operating costs, while continuing to invest capital to meet the
long-term needs of our customers. Importantly,
we’re gaining profitable market share, propelled by our
highest service quality in over a decade. By elevating service and
operational excellence, we’re creating more opportunity for
yield growth over time. This is a key pillar of our LTL 2.0
plan.”
Harik continued, “The significant potential within
XPO is attracting the best talent in the LTL industry, as we
accelerate the execution of our strategy. Wes Frye joined our board
and is a member of our new Operational Excellence Committee. More
recently, Dave Bates, a standout LTL operator, joined us as chief
operating officer. The entire team is focused on delivering
outsized returns in the years ahead.”
First Quarter Highlights
For the first quarter 2023, net income from
continuing operations attributable to common shareholders was $17
million, compared with $32 million for the same period in 2022.
Operating income was $58 million for the first quarter, compared
with $63 million for the same period in 2022, reflecting higher
transaction costs related to the RXO spin-off. Diluted earnings
from continuing operations per share were $0.15 for the first
quarter, compared with $0.28 for the same period in 2022.
Adjusted net income from continuing operations
attributable to common shareholders, a non-GAAP financial measure,
increased to $65 million for the first quarter, compared with $53
million for the same period in 2022. Adjusted diluted earnings from
continuing operations per share (“adjusted EPS”), a non-GAAP
financial measure, increased to $0.56 for the first quarter,
compared with $0.46 for the same period in 2022.
Adjusted earnings before interest, taxes,
depreciation and amortization (“adjusted EBITDA”), a non-GAAP
financial measure, increased to $210 million for the first quarter,
compared with $184 million for the same period in 2022.
The company generated $76 million of cash flow
from operating activities in the quarter. Free cash flow, a
non-GAAP financial measure, was a cash usage of $140 million,
after $216 million of net capital expenditures.
Reconciliations of non-GAAP financial measures in
this press release are provided in the attached financial
tables.
Results by Business
Segment
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First Quarter 2023 Summary Segment Results |
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Three months ended March 31, |
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Revenue |
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Operating Income (Loss) |
|
Adjusted EBITDA(1) |
(in millions) |
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2023 |
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2022 |
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2023 |
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2022 |
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2023 |
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2022 |
North American Less-Than-Truckload Segment |
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$ |
1,120 |
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$ |
1,107 |
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$ |
103 |
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$ |
112 |
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$ |
182 |
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$ |
186 |
European Transportation Segment |
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787 |
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787 |
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(3) |
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1 |
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37 |
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38 |
Corporate |
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- |
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- |
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(42) |
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(50) |
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(9) |
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(40) |
Total(2) |
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$ |
1,907 |
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$ |
1,894 |
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$ |
58 |
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$ |
63 |
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$ |
210 |
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$ |
184 |
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(1) Reconciliations of adjusted EBITDA are provided in the
attached financial tables |
(2) See the Non-GAAP Financial Measures section in this
release |
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North American Less-Than-Truckload (LTL): The segment generated
revenue of $1.12 billion for the first quarter 2023, compared with
$1.11 billion for the same period in 2022. On a year-over-year
basis, shipments per day increased 1.5%, tonnage per day decreased
1.8%, and yield, excluding fuel, increased 1.4%. Including fuel,
yield increased 2.4%. Operating income was $103 million for the
first quarter 2023, compared with $112 million for the same period
in 2022. The first quarter LTL adjusted operating ratio, a non-GAAP
financial measure, was 89.6%, compared with 88.9% a year ago. This
metric reflects a headwind of 110 basis points of incremental
depreciation expense from increased capital investment in the
business. Adjusted EBITDA for the first quarter 2023 was $182
million, compared with $186 million for the same period in
2022.
-
European Transportation: The segment generated revenue of $787
million in each of the first quarters 2023 and 2022. On a constant
currency basis, excluding the unfavorable impact of foreign
exchange, first quarter 2023 revenue increased year-over-year by
6%. The segment generated a first quarter 2023 operating loss of $3
million, compared with operating income of $1 million for the same
period in 2022. The first quarter 2023 loss reflects $7 million of
restructuring expense related to cost reduction actions. Adjusted
EBITDA was $37 million for the first quarter 2023, compared with
$38 million for the same period in 2022.
Conference Call
The company will hold a conference call on
Thursday, May 4, 2023, at 8:30 a.m. Eastern Time. Participants can
call toll-free (from US/Canada) 1-877-269-7756; international
callers dial +1-201-689-7817. A live webcast of the conference will
be available on the investor relations area of the company’s
website, xpo.com/investors. The conference will be archived
until June 4, 2023. To access the replay by phone, call toll-free
(from US/Canada) 1-877-660-6853; international callers dial
+1-201-612-7415. Use participant passcode 13738165.
About XPO
XPO, Inc. (NYSE: XPO) is one of the largest
providers of asset-based less-than-truckload (LTL) freight
transportation in North America, with proprietary technology
that moves goods efficiently through its network. Together with its
business in Europe, XPO serves approximately 48,000 customers
with 558 locations and 38,000 employees. The company is
headquartered in Greenwich, Conn., USA.
Visit xpo.com for more information, and connect with XPO
on Facebook, Twitter, LinkedIn, 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 attached to this press release.
XPO’s non-GAAP financial measures in this press
release include: adjusted earnings before interest, taxes,
depreciation and amortization (“adjusted EBITDA”) on a consolidated
basis and for corporate; adjusted EBITDA margin on a consolidated
basis; adjusted net income from continuing operations attributable
to common shareholders; adjusted diluted earnings from continuing
operations per share (“adjusted EPS”); free cash flows; adjusted
operating income for our North American less-than-truckload and
European segments; adjusted operating ratio for our North
American less-than-truckload segment; and constant currency
revenue growth for our European Transportation segment.
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, XPO and its business segments’ 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 of other companies. These non-GAAP
financial measures should only be used as supplemental measures of
our operating performance.
Adjusted EBITDA, adjusted EBITDA margin, adjusted
net income from continuing operations attributable to common
shareholders and adjusted EPS include adjustments for transaction
and integration costs, as well as restructuring costs and other
adjustments as set forth in the attached tables. 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, stock-based
compensation, retention awards, and 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 converging IT systems. Restructuring costs
primarily relate to severance costs associated with business
optimization initiatives. Management uses these non-GAAP financial
measures in making financial, operating and planning decisions and
evaluating XPO’s and each business segment’s ongoing
performance.
We believe that free cash flow is an important
measure 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 net cash provided by operating
activities from continuing operations, less payment for purchases
of property and equipment plus proceeds from sale of property and
equipment. We believe that adjusted EBITDA and adjusted EBITDA
margin improve comparability from period to period by removing the
impact of our capital structure (interest and financing expenses),
asset base (depreciation and amortization), tax impacts and other
adjustments as set out in the attached tables that management has
determined are not reflective of core operating activities and
thereby assist investors with assessing trends in our underlying
businesses. We believe that adjusted net income from continuing
operations attributable to common shareholders and adjusted EPS
improve the comparability of our operating results from period to
period by removing the impact of certain costs and gains that
management has determined are not reflective of our core operating
activities, including amortization of acquisition-related
intangible assets, transaction and integration costs, restructuring
costs and other adjustments as set out in the attached tables. We
believe that adjusted operating income and adjusted operating ratio
improve the comparability of our operating results from period to
period by removing the impact of certain transaction and
integration costs and restructuring costs, as well as amortization
expenses as set out in the attached tables. We believe that
constant currency revenue growth improves the comparability of our
revenue from period to period by adding foreign exchange rates to
our reported revenue.
Forward-looking
Statements
This 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. 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 us
in light of our experience and our perception of historical trends,
current conditions and expected future developments, as well as
other factors we believe 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 the risks
discussed in our filings with the SEC, and the following: economic
conditions generally; the severity, magnitude, duration and
aftereffects of the COVID-19 pandemic, including supply chain
disruptions due to plant and port shutdowns and transportation
delays, the global shortage of certain components such as
semiconductor chips, strains on production or extraction of raw
materials, cost inflation and labor and equipment shortages, which
may lower levels of service, including the timeliness, productivity
and quality of service, and government responses to these factors;
our ability to align our investments in capital assets, including
equipment, service centers, and warehouses and other network
facilities, to our customers’ demands; our ability to implement our
cost and revenue initiatives; the effectiveness of our action plan,
and other management actions, to improve our North American LTL
business; our ability to benefit from a sale or other divestiture
of one or more business units; our ability to successfully
integrate and realize anticipated synergies, cost savings and
profit improvement opportunities with respect to acquired
companies; goodwill impairment, including in connection with a
business unit sale or other divestiture; matters related to our
intellectual property rights; fluctuations in currency exchange
rates; fuel price and fuel surcharge changes; natural disasters,
terrorist attacks, wars or similar incidents, including the
conflict between Russia and Ukraine and increased tensions between
Taiwan and China; the expected benefits of the spin-off of RXO,
Inc.; the impact of the prior spin-offs of GXO Logistics, Inc. and
RXO, Inc. on the size and business diversity of our company; the
ability of the spin-off of a business unit to qualify for tax-free
treatment for U.S. federal income tax purposes; 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; fluctuations in fixed
and floating interest rates; our ability to maintain positive
relationships with our network of third-party transportation
providers; our ability to attract and retain qualified drivers;
labor matters; litigation; risks associated with our self-insured
claims; risks associated with defined benefit plans for our current
and former employees; the impact of potential sales of common stock
by our chairman; governmental regulation, including trade
compliance laws, as well as changes in international trade
policies, sanctions and tax regimes; governmental or political
actions, including the United Kingdom’s exit from the European
Union; and competition and pricing pressures.
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 ContactTavio
Headley+1-203-413-4006tavio.headley@xpo.com
Media ContactKarina
Frayter+1-203-484-8303karina.frayter@xpo.com
XPO, Inc. |
Condensed Consolidated Statements of Income |
(Unaudited) |
(In millions, except per share data) |
|
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Three Months Ended |
|
March 31, |
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|
2023 |
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2022 |
|
Change % |
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|
|
|
Revenue |
$ |
1,907 |
|
$ |
1,894 |
|
0.7% |
Salaries, wages and employee benefits |
|
762 |
|
|
725 |
|
5.1% |
Purchased transportation |
|
457 |
|
|
510 |
|
-10.4% |
Fuel, operating expenses and supplies |
|
427 |
|
|
418 |
|
2.2% |
Operating taxes and licenses |
|
15 |
|
|
16 |
|
-6.3% |
Insurance and claims |
|
44 |
|
|
56 |
|
-21.4% |
Gains on sales of property and equipment |
|
(3) |
|
|
(1) |
|
200.0% |
Depreciation and amortization expense |
|
101 |
|
|
94 |
|
7.4% |
Transaction and integration costs |
|
22 |
|
|
7 |
|
214.3% |
Restructuring costs |
|
24 |
|
|
6 |
|
300.0% |
Operating income |
|
58 |
|
|
63 |
|
-7.9% |
Other income |
|
(5) |
|
|
(14) |
|
-64.3% |
Interest expense |
|
42 |
|
|
37 |
|
13.5% |
Income from continuing operations before income tax
provision |
|
21 |
|
|
40 |
|
-47.5% |
Income tax provision |
|
4 |
|
|
8 |
|
-50.0% |
Income from continuing operations |
|
17 |
|
|
32 |
|
-46.9% |
Income (loss) from discontinued operations, net of taxes |
|
(3) |
|
|
456 |
|
-100.7% |
Net income attributable to XPO |
$ |
14 |
|
$ |
488 |
|
-97.1% |
|
|
|
|
|
|
|
|
Net income (loss) attributable to common
shareholders |
|
|
|
|
|
|
|
Continuing operations |
$ |
17 |
|
$ |
32 |
|
|
Discontinued operations |
|
(3) |
|
|
456 |
|
|
Net income attributable to common shareholders |
$ |
14 |
|
$ |
488 |
|
|
|
|
|
|
|
|
|
|
Basic earnings (loss) per share attributable to common
shareholders |
|
|
|
|
|
|
|
Continuing operations |
$ |
0.15 |
|
$ |
0.28 |
|
|
Discontinued operations |
|
(0.02) |
|
|
3.97 |
|
|
Basic earnings per share attributable to common shareholders |
$ |
0.13 |
|
$ |
4.25 |
|
|
Diluted earnings (loss) per share attributable to common
shareholders |
|
|
|
|
|
|
|
Continuing operations |
$ |
0.15 |
|
$ |
0.28 |
|
|
Discontinued operations |
|
(0.02) |
|
|
3.94 |
|
|
Diluted earnings per share attributable to common shareholders |
$ |
0.13 |
|
$ |
4.22 |
|
|
|
|
|
|
|
|
|
|
Weighted-average common shares outstanding |
|
|
|
|
|
|
|
Basic weighted-average common shares outstanding |
|
116 |
|
|
115 |
|
|
Diluted weighted-average common shares outstanding |
|
116 |
|
|
116 |
|
|
XPO, Inc. |
Condensed Consolidated Balance Sheets |
(Unaudited) |
(In millions, except per share data) |
|
|
|
|
|
|
|
March 31, |
|
December 31, |
|
2023 |
|
2022 |
ASSETS |
|
|
|
|
|
Current assets |
|
|
|
|
|
Cash and cash equivalents |
$ |
309 |
|
$ |
460 |
Accounts receivable, net of allowances of $48 and $43,
respectively |
|
1,019 |
|
|
954 |
Other current assets |
|
221 |
|
|
199 |
Current assets of discontinued operations |
|
16 |
|
|
17 |
Total current assets |
|
1,565 |
|
|
1,630 |
Long-term assets |
|
|
|
|
|
Property and equipment, net of $1,743 and $1,679 in accumulated
depreciation, respectively |
|
1,978 |
|
|
1,832 |
Operating lease assets |
|
717 |
|
|
719 |
Goodwill |
|
1,483 |
|
|
1,472 |
Identifiable intangible assets, net of $407 and $392 in accumulated
amortization, respectively |
|
396 |
|
|
407 |
Other long-term assets |
|
209 |
|
|
209 |
Total long-term assets |
|
4,783 |
|
|
4,639 |
Total assets |
$ |
6,348 |
|
$ |
6,269 |
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
|
|
Current liabilities |
|
|
|
|
|
Accounts payable |
$ |
505 |
|
$ |
521 |
Accrued expenses |
|
792 |
|
|
774 |
Short-term borrowings and current maturities of long-term debt |
|
66 |
|
|
59 |
Short-term operating lease liabilities |
|
110 |
|
|
107 |
Other current liabilities |
|
58 |
|
|
30 |
Current liabilities of discontinued operations |
|
15 |
|
|
16 |
Total current liabilities |
|
1,546 |
|
|
1,507 |
Long-term liabilities |
|
|
|
|
|
Long-term debt |
|
2,478 |
|
|
2,473 |
Deferred tax liability |
|
307 |
|
|
319 |
Employee benefit obligations |
|
92 |
|
|
93 |
Long-term operating lease liabilities |
|
606 |
|
|
606 |
Other long-term liabilities |
|
264 |
|
|
259 |
Total long-term liabilities |
|
3,747 |
|
|
3,750 |
|
|
|
|
|
|
Stockholders’ equity |
|
|
|
|
|
Common stock, $0.001 par value; 300 shares authorized; 116 and 115
shares issued and |
|
|
|
|
|
outstanding as of March 31, 2023 and December 31, 2022,
respectively |
|
- |
|
|
- |
Additional paid-in capital |
|
1,252 |
|
|
1,238 |
Retained earnings (accumulated deficit) |
|
10 |
|
|
(4) |
Accumulated other comprehensive loss |
|
(207) |
|
|
(222) |
Total equity |
|
1,055 |
|
|
1,012 |
Total liabilities and equity |
$ |
6,348 |
|
$ |
6,269 |
XPO, Inc. |
Condensed Consolidated Statements of Cash
Flows |
(Unaudited) |
(In millions) |
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
March 31, |
|
|
|
2023 |
|
|
2022 |
Cash flows from operating activities of continuing
operations |
|
|
|
|
|
Net income |
$ |
14 |
|
$ |
488 |
Income (loss) from discontinued operations, net of taxes |
|
(3) |
|
|
456 |
Income from continuing operations |
|
17 |
|
|
32 |
Adjustments to reconcile income from continuing operations
to net cash from operating activities |
|
|
|
|
|
|
Depreciation, amortization and net lease
activity |
|
101 |
|
|
94 |
|
Stock compensation expense |
|
22 |
|
|
6 |
|
Accretion of debt |
|
3 |
|
|
4 |
|
Deferred tax expense (benefit) |
|
(2) |
|
|
5 |
|
Gains on sales of property and equipment |
|
(3) |
|
|
(1) |
|
Other |
|
17 |
|
|
6 |
Changes in assets and liabilities |
|
|
|
|
|
|
Accounts receivable |
|
(69) |
|
|
(154) |
|
Other assets |
|
(24) |
|
|
(37) |
|
Accounts payable |
|
(8) |
|
|
117 |
|
Accrued expenses and other liabilities |
|
22 |
|
|
116 |
Net cash provided by operating activities from continuing
operations |
|
76 |
|
|
188 |
Cash flows from investing activities of continuing
operations |
|
|
|
|
|
|
Payment for purchases of property and equipment |
|
(224) |
|
|
(123) |
|
Proceeds from sale of property and equipment |
|
8 |
|
|
3 |
Net cash used in investing activities from continuing
operations |
|
(216) |
|
|
(120) |
Cash flows from financing activities of continuing
operations |
|
|
|
|
|
|
Repayment of debt and finance leases |
|
(16) |
|
|
(16) |
|
Change in bank overdrafts |
|
19 |
|
|
3 |
|
Payment for tax withholdings for restricted
shares |
|
(12) |
|
|
(12) |
|
Other |
|
(1) |
|
|
1 |
Net cash used in financing activities from continuing
operations |
|
(10) |
|
|
(24) |
Cash flows from discontinued operations |
|
|
|
|
|
|
Operating activities of discontinued operations |
|
(8) |
|
|
13 |
|
Investing activities of discontinued operations |
|
1 |
|
|
691 |
Net cash provided by (used in) discontinued
operations |
|
(7) |
|
|
704 |
Effect of exchange rates on cash, cash equivalents and restricted
cash |
|
2 |
|
|
(3) |
Net increase (decrease) in cash, cash equivalents and
restricted cash |
|
(155) |
|
|
745 |
Cash, cash equivalents and restricted cash, beginning of
period |
|
470 |
|
|
273 |
Cash, cash equivalents and restricted cash, end of
period |
|
315 |
|
|
1,018 |
Less: Cash, cash equivalents and restricted cash of
discontinued operations, end of period |
|
- |
|
|
50 |
Cash, cash equivalents and restricted cash of continuing
operations, end of period |
$ |
315 |
|
$ |
968 |
North American Less-Than-Truckload Segment |
Summary Financial Table |
(Unaudited) |
(In millions) |
|
|
|
|
|
|
|
|
|
Three Months Ended March 31, |
|
2023 |
|
2022 |
|
Change % |
|
|
|
|
|
|
|
|
Revenue (excluding fuel surcharge revenue) |
$ |
903 |
|
$ |
900 |
|
0.3% |
Fuel surcharge revenue |
|
217 |
|
|
207 |
|
4.8% |
Revenue |
|
1,120 |
|
|
1,107 |
|
1.2% |
Salaries, wages and employee benefits |
|
555 |
|
|
520 |
|
6.7% |
Purchased transportation |
|
99 |
|
|
136 |
|
-27.2% |
Fuel, operating expenses and supplies (1) |
|
248 |
|
|
232 |
|
6.9% |
Operating taxes and licenses |
|
12 |
|
|
13 |
|
-7.7% |
Insurance and claims |
|
28 |
|
|
35 |
|
-20.0% |
(Gains) losses on sales of property and equipment |
|
1 |
|
|
- |
|
100.0% |
Depreciation and amortization |
|
68 |
|
|
56 |
|
21.4% |
Transaction and integration costs |
|
- |
|
|
- |
|
- |
Restructuring costs |
|
6 |
|
|
3 |
|
100.0% |
Operating income |
|
103 |
|
|
112 |
|
-8.0% |
Operating ratio (2) |
|
90.8% |
|
|
89.9% |
|
|
Amortization expense |
|
8 |
|
|
8 |
|
|
Transaction and integration costs |
|
- |
|
|
- |
|
|
Restructuring costs |
|
6 |
|
|
3 |
|
|
Gains on real estate transactions |
|
- |
|
|
- |
|
|
Adjusted operating income (3) |
$ |
117 |
|
$ |
123 |
|
-4.9% |
Adjusted operating ratio (3) (4) |
|
89.6% |
|
|
88.9% |
|
|
Depreciation expense |
|
60 |
|
|
48 |
|
|
Pension income |
|
4 |
|
|
15 |
|
|
Gains on real estate transactions |
|
- |
|
|
- |
|
|
Other |
|
1 |
|
|
- |
|
|
Adjusted EBITDA (5) |
$ |
182 |
|
$ |
186 |
|
-2.2% |
Adjusted EBITDA margin (6) |
|
16.3% |
|
|
16.8% |
|
|
|
|
|
|
|
|
|
|
Note: In the first quarter 2023, the company began allocating
incremental corporate costs from Corporate to the North American
Less-Than-Truckload segment. Prior periods have been recast to
reflect these incremental allocations, which approximated $80
million annually. |
(1) Fuel, operating expenses and supplies includes
fuel-related taxes. |
(2) Operating ratio is calculated as (1 - (Operating income
divided by Revenue)). |
(3) See the “Non-GAAP Financial Measures” section of the press
release. |
(4) Adjusted operating ratio is calculated as (1 - (Adjusted
operating income divided by Revenue)); adjusted operating margin is
the inverse of adjusted operating ratio |
(5) Adjusted EBITDA is used by our chief operating decision
maker to evaluate segment profit (loss) in accordance with ASC
280. |
(6) Adjusted EBITDA margin is calculated as Adjusted EBITDA
divided by Revenue. |
North American Less-Than-Truckload |
Summary Data Table |
(Unaudited) |
|
|
|
|
|
|
|
|
|
Three Months Ended March 31, |
|
2023 |
|
2022 |
|
Change % |
|
|
|
|
|
|
|
|
Pounds per day (thousands) |
|
68,889 |
|
|
70,176 |
|
-1.8% |
|
|
|
|
|
|
|
|
Shipments per day |
|
49,107 |
|
|
48,366 |
|
1.5% |
|
|
|
|
|
|
|
|
Average weight per shipment (in pounds) |
|
1,403 |
|
|
1,451 |
|
-3.3% |
|
|
|
|
|
|
|
|
Revenue per shipment |
$ |
356.06 |
|
$ |
356.95 |
|
-0.2% |
|
|
|
|
|
|
|
|
Gross revenue per hundredweight (including fuel
surcharges) (1) |
$ |
25.99 |
|
$ |
25.38 |
|
2.4% |
|
|
|
|
|
|
|
|
Gross revenue per hundredweight (excluding fuel
surcharges) (1) |
$ |
21.06 |
|
$ |
20.76 |
|
1.4% |
|
|
|
|
|
|
|
|
Average length of haul (in miles) |
|
831.3 |
|
|
835.1 |
|
|
|
|
|
|
|
|
|
|
Total average load factor (2) |
|
23,095 |
|
|
24,219 |
|
-4.6% |
|
|
|
|
|
|
|
|
Average age of tractor fleet (years) |
|
5.2 |
|
|
5.9 |
|
|
|
|
|
|
|
|
|
|
Number of working days |
|
64.0 |
|
|
64.0 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Gross revenue per hundredweight excludes the adjustment
required for financial statement purposes in accordance with the
company's revenue recognition policy. |
(2) Total average load factor equals freight pound miles
divided by total linehaul miles. |
Note: Table excludes the company's trailer manufacturing
operations. |
European Transportation Segment |
Summary Financial Table |
(Unaudited) |
(In millions) |
|
|
|
|
|
|
|
|
|
Three Months Ended March 31, |
|
2023 |
|
2022 |
|
Change % |
|
|
|
|
|
|
|
|
Revenue |
$ |
787 |
|
$ |
787 |
|
- |
Salaries, wages and employee benefits |
|
203 |
|
|
185 |
|
9.7% |
Purchased transportation |
|
358 |
|
|
374 |
|
-4.3% |
Fuel, operating expenses and supplies (1) |
|
175 |
|
|
174 |
|
0.6% |
Operating taxes and licenses |
|
3 |
|
|
3 |
|
- |
Insurance and claims |
|
15 |
|
|
14 |
|
7.1% |
Gains on sales of property and equipment |
|
(4) |
|
|
(1) |
|
300.0% |
Depreciation and amortization |
|
32 |
|
|
33 |
|
-3.0% |
Transaction and integration costs |
|
1 |
|
|
2 |
|
-50.0% |
Restructuring costs |
|
7 |
|
|
2 |
|
250.0% |
Operating income (loss) |
$ |
(3) |
|
$ |
1 |
|
NM |
Amortization expense |
|
5 |
|
|
5 |
|
|
Transaction and integration costs |
|
1 |
|
|
2 |
|
|
Restructuring costs |
|
7 |
|
|
2 |
|
|
Adjusted operating income (2) |
$ |
10 |
|
$ |
10 |
|
- |
Depreciation expense |
|
27 |
|
|
28 |
|
|
Adjusted EBITDA (3) |
|
37 |
|
|
38 |
|
-2.6% |
Adjusted EBITDA margin (4) |
|
4.7% |
|
|
4.9% |
|
|
|
|
|
|
|
|
|
|
NM - Not meaningful. |
(1) Fuel, operating expenses and supplies includes
fuel-related taxes. |
(2) See the “Non-GAAP Financial Measures” section of the press
release. |
(3) Adjusted EBITDA is used by our chief operating decision
maker to evaluate segment profit (loss) in accordance with ASC
280. |
(4) Adjusted EBITDA margin is calculated as Adjusted EBITDA
divided by Revenue. |
Corporate |
Summary Financial Table |
(Unaudited) |
(In millions) |
|
|
|
|
|
|
|
|
|
Three Months Ended March 31, |
|
2023 |
|
2022 |
|
Change % |
|
|
|
|
|
|
|
|
Revenue |
$ |
- |
|
$ |
- |
|
- |
|
|
|
|
|
|
|
|
Salaries, wages and employee benefits |
|
4 |
|
|
20 |
|
-80.0% |
Fuel, operating expenses and supplies |
|
4 |
|
|
12 |
|
-66.7% |
Operating taxes and licenses |
|
- |
|
|
- |
|
- |
Insurance and claims |
|
1 |
|
|
7 |
|
-85.7% |
Depreciation and amortization |
|
1 |
|
|
5 |
|
-80.0% |
Transaction and integration costs |
|
21 |
|
|
5 |
|
320.0% |
Restructuring costs |
|
11 |
|
|
1 |
|
NM |
Operating loss |
$ |
(42) |
|
$ |
(50) |
|
-16.0% |
Other income (expense) (1) |
|
- |
|
|
(1) |
|
|
Depreciation and amortization |
|
1 |
|
|
5 |
|
|
Transaction and integration costs |
|
21 |
|
|
5 |
|
|
Restructuring costs |
|
11 |
|
|
1 |
|
|
Adjusted EBITDA (2) |
$ |
(9) |
|
$ |
(40) |
|
-77.5% |
|
|
|
|
|
|
|
|
NM - Not meaningful. |
(1) Other income (expense) consists of foreign currency gain
(loss) and other income (expense). |
(2) See the “Non-GAAP Financial Measures” section of the press
release. |
XPO, Inc. |
Reconciliation of Non-GAAP Measures |
(Unaudited) |
(In millions) |
|
|
|
|
|
|
|
|
|
Three Months Ended March 31, |
|
2023 |
|
2022 |
|
Change % |
|
|
|
|
|
|
|
|
Reconciliation of Net Income from Continuing Operations to
Adjusted EBITDA |
|
|
|
|
|
|
|
Net income from continuing operations attributable to common
shareholders |
$ |
17 |
|
$ |
32 |
|
-46.9% |
Interest expense |
|
42 |
|
|
37 |
|
|
Income tax provision |
|
4 |
|
|
8 |
|
|
Depreciation and amortization expense |
|
101 |
|
|
94 |
|
|
Transaction and integration costs |
|
22 |
|
|
7 |
|
|
Restructuring costs |
|
24 |
|
|
6 |
|
|
Adjusted EBITDA (1) |
$ |
210 |
|
$ |
184 |
|
14.1% |
Revenue |
$ |
1,907 |
|
$ |
1,894 |
|
0.7% |
Adjusted EBITDA margin (1) (2) |
|
11.0% |
|
|
9.7% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) See the “Non-GAAP Financial Measures” section of the press
release. |
(2) Adjusted EBITDA margin is calculated as Adjusted EBITDA
divided by Revenue. |
XPO, Inc. |
Reconciliation of Non-GAAP Measures (cont.) |
(Unaudited) |
(In millions, except per share data) |
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
March 31, |
|
|
2023 |
|
2022 |
|
|
|
|
|
|
|
Reconciliation of Net Income from Continuing Operations and
Diluted Earnings Per Share from Continuing Operations to Adjusted
Net Income from Continuing Operations and Adjusted Earnings Per
Share from Continuing Operations |
|
|
|
|
|
Net income from continuing operations attributable to common
shareholders |
$ |
17 |
|
$ |
32 |
|
Amortization of acquisition-related intangible assets |
|
13 |
|
|
14 |
|
Transaction and integration costs |
|
22 |
|
|
7 |
|
Restructuring costs |
|
24 |
|
|
6 |
|
Income tax associated with the adjustments above (1) |
|
(11) |
|
|
(6) |
Adjusted net income from continuing operations attributable
to |
|
|
|
|
- |
|
common shareholders (2) |
$ |
65 |
|
$ |
53 |
|
|
|
|
|
|
|
Adjusted diluted earnings from continuing operations per
share (2) |
$ |
0.56 |
|
$ |
0.46 |
|
|
|
|
|
|
|
Weighted-average common shares outstanding |
|
|
|
|
|
|
Diluted weighted-average common shares outstanding |
|
116 |
|
|
116 |
|
|
|
|
|
|
|
(1) This line item reflects the aggregate tax benefit of all
non-tax related adjustments reflected in the table above. The
detail by line item is as follows: |
|
Amortization of acquisition-related intangible assets |
|
3 |
|
|
3 |
|
Transaction and integration costs |
|
3 |
|
|
2 |
|
Restructuring costs |
|
5 |
|
|
1 |
|
|
$ |
11 |
|
$ |
6 |
|
|
|
|
|
|
|
The income tax rate applied to reconciling items is based on the
GAAP annual effective tax rate, excluding discrete items,
non-deductible compensation, and contribution- and margin-based
taxes. |
|
|
|
|
|
|
|
(2) See the "Non-GAAP Financial Measures" section of the press
release. |
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
March 31, |
|
|
2023 |
|
2022 |
Reconciliation of Cash Flows from Operating Activities of
Continuing Operations to Free Cash Flow |
|
|
|
|
|
Net cash provided by operating activities from continuing
operations |
$ |
76 |
|
$ |
188 |
|
Payment for purchases of property and equipment |
|
(224) |
|
|
(123) |
|
Proceeds from sale of property and equipment |
|
8 |
|
|
3 |
Free Cash Flow (1) |
$ |
(140) |
|
$ |
68 |
|
|
|
|
|
|
|
(1) See the "Non-GAAP Financial Measures" section of the press
release. |
XPO, Inc. |
Reconciliation of Constant Currency Revenue |
(Unaudited) |
(In millions) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31, |
|
2023 |
|
2022 |
Reconciliation of Constant Currency Revenue for European
Transportation Segment |
|
|
|
|
|
Revenue |
$ |
787 |
|
$ |
787 |
Foreign exchange rates |
|
48 |
|
|
- |
Constant currency revenue (1) |
$ |
835 |
|
$ |
787 |
Constant currency revenue growth (2) |
|
6.1% |
|
|
|
|
|
|
|
|
|
(1) See the “Non-GAAP Financial Measures” section of the press
release. |
(2) Constant currency revenue growth is calculated as the
relative change in year-over-year constant currency revenue,
expressed as a percentage of 2022 constant currency revenue. |
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