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XPO 8-K Report, Regulation FD Disclosure (Feb 7, 2024)

Reports
Regulation FD·Exhibits & Filings
Filing Date
Filed February 7, 2024
Period End
February 7, 2024
Security
XPO
In the record · 2016–202610-K1110-Q338-K243

XPO filed 11 annual reports (10-K), 33 quarterly reports (10-Q) and 243 current reports (8-K) between 2016 and 2026.

  1. Material agreement8-K · Feb ’18Feb ’18
  2. Leadership change8-K · May ’20May ’20
  3. Deal closed8-K · Nov ’22Nov ’22
  4. Leadership change8-K · Jul ’26Jul ’26

01—Abstract

Summary

Summary of the 8-K filed February 7, 2024. Cited figures are marked; the original filing is the authoritative source.

XPO, Inc. furnished an investor presentation dated February 7, 2024 under Item 7.01 (Regulation FD) as Exhibit 99.1.

The filing states the presentation may be used in future investor meetings, should be read with the company's SEC filings including its 2023 Form 10-K, and is furnished rather than filed for purposes of Section 18 of the Exchange Act. The fourth-quarter 2023 results it presents include revenue of $1.94 billiona, up 6% year over year; adjusted EBITDA of $264 million, up 28% year over year excluding $55 million of 2022 real estate gains; net income from continuing operations of $58 million; diluted EPS from continuing operations of $0.49; and adjusted diluted EPS of $0.77. Operating cash flow from continuing operations was $251 million.

The North American LTL segment reported fourth-quarter revenue of $1.19 billionb, adjusted operating ratio of 86.5%, improved by 380 bps year over year, and LTL yield excluding fuel up 10.3% year over year. The company attributes this to service improvements, with a damage claims ratio of 0.3%, down from 0.4% in Q3 2023. The presentation outlines the "LTL 2.0" plan, with targets for 2021 through 2027 of 6% to 8% revenue CAGR, 11% to 13% adjusted EBITDA CAGR, and an adjusted operating ratio improvement of at least 600 bps, alongside a plan to reduce outsourced linehaul miles to a low-teens percentage by 2027.

For 2024, the company expects gross capex of $700 million to $800 millionc, interest expense of $240 million to $260 million, pension income of approximately $25 million, an adjusted effective tax rate of 23% to 25%, and a diluted share count of 121 million. The presentation also notes the December 2023 acquisition of 28 service centers, which are to be integrated throughout 2024 and 2025.

02—Key points

Key Highlights

  1. Q4 2023 revenue of $1.94 billion, up 6% year over year, with adjusted EBITDA of $264 million, up 28% excluding 2022 real estate gains.
  2. Q4 2023 diluted EPS from continuing operations of $0.49 and adjusted diluted EPS of $0.77; full-year 2023 adjusted diluted EPS of $2.92.
  3. North American LTL adjusted operating ratio of 86.5% in Q4 2023, improving by 380 bps year over year, with LTL yield excluding fuel up 10.3%.
  4. LTL damage claims ratio improved to 0.3% in Q4 2023 from 0.4% in Q3 2023, which the company attributes to record service quality.
  5. Long-term LTL targets for 2021 to 2027: 6% to 8% revenue CAGR, 11% to 13% adjusted EBITDA CAGR, and an adjusted operating ratio improvement of at least 600 bps.
  6. 2024 planning assumptions include gross capex of $700 million to $800 million, interest expense of $240 million to $260 million, and a diluted share count of 121 million.
  7. Acquired 28 service centers in December 2023, to be integrated throughout 2024 and 2025.

03—Questions

Frequently Asked Questions

  1. How did XPO perform in the fourth quarter of 2023?

    Revenue was $1.94 billion, up 6% year over year. Adjusted EBITDA was $264 million, up 28% excluding $55 million of real estate gains in 2022. Net income from continuing operations was $58 million, or $0.49 per diluted share, and adjusted diluted EPS was $0.77.

  2. How did the North American LTL segment perform?

    North American LTL revenue was $1.19 billion and adjusted operating income was $160 million, with an adjusted operating ratio of 86.5%, improved by 380 bps year over year. LTL tonnage per day rose 2.0% and yield excluding fuel rose 10.3%.

  3. What are the company's long-term LTL targets?

    For 2021 through 2027, the company targets a North American LTL revenue CAGR of 6% to 8%, an adjusted EBITDA CAGR of 11% to 13%, and an adjusted operating ratio improvement of at least 600 bps. The presentation also targets capex of 8% to 12% of revenue on average through 2027.

  4. What guidance did XPO provide for full-year 2024?

    The company expects gross capex of $700 million to $800 million, interest expense of $240 million to $260 million, pension income of approximately $25 million, an adjusted effective tax rate of 23% to 25%, and a diluted share count of 121 million.

  5. Is the information in this presentation considered filed with the SEC?

    No. The filing states that the information furnished under Item 7.01, including Exhibit 99.1, is not deemed filed for purposes of Section 18 of the Exchange Act and is not incorporated by reference into other filings unless specifically stated. It also says the presentation should be read together with the company's SEC filings, including its 2023 Form 10-K.

04—Continue

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