XPO Logistics has bumper second quarter

XPO Logistics’ second-quarter results for 2016 leave no doubt that the company has turned a corner towards profitability, after years of acquisitions and restructuring. The supply chain logistics company’s gross revenues increased 202.9 percent, year-over-year, in Q2 to US$3.7 billion. Net income attributable to common shareholders was $42.6 million for the quarter.

Over the first half of 2016, XPO reported total revenue of $7.2 billion, a 276.7 percent increase over the first half 2015.

XPO’s transportation segment generated total gross revenue of $2.4 billion for the second quarter – a 180.9 percent increase, y-o-y. The increase in revenue was driven by 2015 acquisitions, especially in last-mile and truck brokerage business from recent purchases such as Norbert Dentressangle and Con-way.

XPO’s logistics segment generated a gross revenue of $1.3 billion for the second quarter, up 270.4 percent, y-o-y, from $359.6 million in 2Q in 2015. Operating income for 2Q was $51.1 million. Adjusted EBITDA over the same time period was $106.9 million, up from $35.8 million in 2015. The company also attributed its increases to 2015 acquisitions.

With financials working in its favor, the company is able to project a bullish 2016 EBITA of at least $1.27 billion, up from $1.25 billion last year, and has increased its target for free cash flow to at least $150 million, from a prior range of $100 million to $150 million. XPO has also reaffirmed its full-year 2018 target of approximately $1.7 billion of EBITDA.

Bradley Jacobs, chairman and CEO of XPO Logistics, explained that, “In the second quarter, we generated $355 million of adjusted EBITDA, $261 million of cash flow from operations, and $170 million of free cash flow – all records for our company. We’re at an inflection point in the evolution of our business, accelerating our EBITDA and cash generation, while continuing to invest in technology, our sales force and other levers of future growth.”

Jacobs also noted that, “more than $300 million of our profit improvement opportunities are company-specific and independent of macro conditions, including the global optimization of our network and the rationalization of $14 billion of addressable spend.”

Join us for networking and discussion of logistics innovation at Air Cargo World’s new ELEVATE 2016 Conference, Oct. 10, in Miami.