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10-Q
XPO LOGISTICS, INC. filed this Form 10-Q on 11/05/2018
Entire Document
 

We concentrate our efforts in the following areas of innovation: automation and robotics; big data; visibility and customer service; and the digital freight marketplace. We have built a highly scalable and integrated system on a cloud-based platform that speeds up both the development process and the time-to-launch. Our global team of more than 1,700 technology professionals can deploy proprietary software very rapidly.
Our focus is on developing innovations that differentiate our services and create tangible value for our customers. For example, we have the ability to share data with our customers in real time, including visibility of orders moving through fulfillment, shipments in transit and on-demand availability of truckload capacity. Internally, our technology gives us a birds-eye view of real-time market conditions and pricing for truckload, intermodal and LTL, and facilitates load assignments with our independent contractors, all of which greatly enhances customer service.
In addition, we have a strong, global commitment to sustainability. We own the largest natural gas truck fleet in Europe, and we launched government-approved mega-trucks in Spain, both of which reduce our carbon footprint. We have been awarded the label “Objectif CO2” for outstanding environmental performance of transport operations in Europe by the French Ministry of the Environment and the French Environment and Energy Agency.
Many of our logistics facilities globally are ISO 14001-certified, which ensures environmental and other regulatory compliances. We monitor fuel emissions from forklifts, with protocols in place to take immediate corrective action if needed. Our packaging engineers ensure that the optimal carton size is used for each product slated for distribution and, as a byproduct of reverse logistics, we recycle millions of electronic components and batteries each year. These are just a few of the many initiatives that reflect our commitment to operating in a progressive and environmentally sound manner, with the greatest efficiency and least waste possible.
XPO Logistics, Inc.
Consolidated Summary Financial Table
 
 
Three Months Ended September 30,
 
Percent of Revenue
 
Change
 
Nine Months Ended September 30,
 
Percent of Revenue
 
Change
(Dollars in millions)
 
2018
 
2017
 
2018
 
2017
 
2018 vs. 2017
 
2018
 
2017
 
2018
 
2017
 
2018 vs. 2017
Revenue
 
$
4,335.1

 
$
3,887.1

 
100.0
 %
 
100.0
 %
 
11.5
 %
 
$
12,890.1

 
$
11,186.9

 
100.0
 %
 
100.0
 %
 
15.2
 %
Cost of transportation and services
 
2,248.6

 
2,043.4

 
51.9
 %
 
52.6
 %
 
10.0
 %
 
6,747.7

 
5,901.8

 
52.3
 %
 
52.8
 %
 
14.3
 %
Direct operating expense
 
1,430.3

 
1,267.4

 
33.0
 %
 
32.6
 %
 
12.9
 %
 
4,212.7

 
3,616.1

 
32.7
 %
 
32.3
 %
 
16.5
 %
SG&A expense
 
447.2

 
399.6

 
10.3
 %
 
10.3
 %
 
11.9
 %
 
1,351.7

 
1,213.4

 
10.5
 %
 
10.8
 %
 
11.4
 %
Operating income
 
209.0

 
176.7

 
4.8
 %
 
4.5
 %
 
18.3
 %
 
578.0

 
455.6

 
4.5
 %
 
4.1
 %
 
26.9
 %
Other expense (income)
 
(18.3
)
 
(16.8
)
 
(0.4
)%
 
(0.4
)%
 
8.9
 %
 
(68.1
)
 
(35.8
)
 
(0.5
)%
 
(0.3
)%
 
90.2
 %
Foreign currency loss
 
3.3

 
15.0

 
0.1
 %
 
0.4
 %
 
(78.0
)%
 
5.3

 
53.9

 
 %
 
0.5
 %
 
(90.2
)%
Debt extinguishment loss
 
16.8

 
4.6

 
0.4
 %
 
0.1
 %
 
265.2
 %
 
27.1

 
13.6

 
0.2
 %
 
0.1
 %
 
99.3
 %
Interest expense
 
51.0

 
72.5

 
1.2
 %
 
1.9
 %
 
(29.7
)%
 
165.3

 
222.4

 
1.3
 %
 
2.0
 %
 
(25.7
)%
Income before income tax provision
 
156.2

 
101.4

 
3.6
 %
 
2.6
 %
 
54.0
 %
 
448.4

 
201.5

 
3.5
 %
 
1.8
 %
 
122.5
 %
Income tax provision
 
41.0

 
30.4

 
0.9
 %
 
0.8
 %
 
34.9
 %
 
95.0

 
48.4

 
0.7
 %
 
0.4
 %
 
96.3
 %
Net income
 
$
115.2

 
$
71.0

 
2.7
 %
 
1.8
 %
 
62.3
 %
 
$
353.4

 
$
153.1

 
2.7
 %
 
1.4
 %
 
130.8
 %
Consolidated Results
Revenue for the third quarter of 2018 increased 11.5% to $4.3 billion as compared to the same period in 2017. Revenue for the first nine months of 2018 increased 15.2% to $12.9 billion as compared to the same period in 2017. The increases in both the third quarter and nine-month period were driven primarily by growth in our European and North American contract logistics businesses, as well as improvements in the transportation business, most notably in our freight brokerage and last mile service offerings. Foreign currency movement decreased revenue growth by approximately 0.4 percentage points in the third quarter of 2018 and contributed approximately 2.8 percentage points for the first nine months of 2018.


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