Virtual Investor Day
July 13, 2021

GXO will be the largest pure-play contract logistics provider in the world.

XPO expects the spin off its logistics segment to be completed on August 2, 2021. In advance, the incoming leadership hosted a Virtual Investor Day. Discussion included GXO’s investment highlights, operations, technology, financial performance and growth prospects.

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GXO Virtual Investor Day

GXO is expected to go public on August 2, 2021. GXO will trade on the New York Stock Exchange under the symbol “GXO”. Management covers investment highlights, operations, technology, financial performance and growth prospects.


GXO is the global logistics segment of XPO Logistics, which XPO plans to spin off in the second half of 2021. GXO will be the largest pure-play contract logistics provider in the world, and a leader in cutting-edge warehousing and distribution, including ecommerce logistics. Our business is led by best-in-class management talent that will transition to GXO once the planned spin-off is complete.

We serve a highly diversified, blue-chip customer base characterized by long-term contractual relationships that provide visibility into future revenue and earnings. Although we have 885 locations in 27 countries and about 93,000 team members, we hold only a 5% share of the highly fragmented, $130 billion outsourced contract logistics market in North America and Europe. This gives us a vast runway for expansion through organic growth and M&A.

GXO benefits from three massive tailwinds that are propelling our growth: the secular increase in ecommerce orders and returns, customer demand for advanced warehouse automation, and the increasing trend toward outsourcing supply chain services.

Ecommerce: The secular growth of ecommerce, which has substantially outpaced growth in the broader economy for years, accelerated during the recent shift in consumer behavior to online buying. GXO is a global leader in ecommerce logistics, with the largest outsourced ecommerce platform in Europe and an expansive platform in North America providing order fulfilment and reverse logistics. We serve a range of customers in this space, including pure-play e-tailers, omnichannel retailers and direct-to-consumer manufacturers.

Automation: Warehouses are becoming increasingly automated for speed, cost-efficiency and safety. Applications of robots, cobots, goods-to-person systems, automated sortation and wearable technologies are transforming logistics. We’re a global leader in integrating scalable software solutions for warehouse management, intelligent automation, predictive analytics, labor productivity and other capabilities valued by logistics customers. In 2020, we shipped about five times more product units using robots than we did in 2019.

Outsourcing: Supply chains are becoming more complex to meet demanding end-customer expectations for speed and precision. In addition, in 2020, many companies realized that supply chain management was not their core competency; this served to heighten the longstanding outsourcing trend. Rather than expose their in-house supply chains to vulnerabilities, companies are increasingly seeking to de-risk by using large third-party providers that have superior technological resources and know-how, such as GXO.

GXO has long-term customer relationships with renowned global brands, including more than a third of the Fortune 100 companies. Our strategic focus on key verticals has been core to our success, as reflected in our top five revenue producers: ecommerce and omnichannel retail (40% of revenue), food and beverage (13%), consumer packaged goods (13%) and consumer technology (11%). Our expertise drives differentiation in the customer’s eyes and allows us to leverage our innovation across multiple verticals. Importantly, no single customer accounted for more than 4% of our total logistics revenue in 2020.

Our success with long-term, blue-chip customer relationships is due in large part to the mission-critical nature of the solutions we provide; they position us as a strategic partner, rather than merely a supplier. Our top 20 customers have, on average, partnered with us for 15 years. Our average contract length is about five years, and typically renews. Recently, our contract lengths have been growing longer as customers look to lock in future predictability for their supply chains.

GXO is positioned as a game-changer—we offer customers superior levels of service and reliable outcomes across markets, with highly engineered solutions customized for each supply chain.

One of our strongest competitive advantages emanates from our proprietary technology suite, which encompasses warehouse management, labor management, order management and demand management. We developed software tools that use machine learning to drive significant labor productivity in our warehouses, achieving a 5-7% productivity gain on average. The digital connectivity between our solutions and third-party automation enables us to stand up sophisticated operations quickly at scale, and flex them as needed. These are all critical differentiators that underpin our high profit margins.

We’re also differentiated by our diversity of expertise and the quality of our customer base. Our customers include many household names and market leaders—we collaborate with them on planning and forecasting, and we can provide assistance with supply chain optimization to meet specific goals, such as sustainability metrics. This multidisciplinary, consultative approach has led to many of our key customer relationships extending for years and growing in scope.

GXO will have the advantage of a world-class leadership team from day one, with a pedigree of strong organic growth, outstanding reputational value, disciplined capital allocation and successful M&A transactions. Brad Jacobs, XPO’s chairman, will serve as chairman of the GXO board of directors. The following executives have been named to GXO leadership positions to date, and will transition to GXO from XPO once the spin-off is complete:

  • Malcolm Wilson, chief executive officer; currently serves as XPO’s CEO in Europe
  • Baris Oran, chief financial officer; currently holds this role with XPO’s logistics segment
  • Mark Manduca, chief investment officer; currently holds this role with XPO’s logistics segment
  • Richard Cawston, president, Europe; currently holds this role with XPO’s logistics segment
  • Eduardo Pelleissone, president, North America and Asia Pacific; currently holds this role with XPO’s logistics segment
  • Bill Fraine, chief commercial officer; currently serves as XPO’s division president, supply chain logistics for the Americas and Asia Pacific
  • Neil Shelton, chief strategy officer
  • Maryclaire Hammond, chief human resources officer; currently serves as XPO’s senior vice president, human resources for the Americas and Asia Pacific
  • Sandeep Sakharkar, chief information officer; currently serves as XPO’s executive vice president, logistics technology
  • Meagan Fitzsimmons, chief compliance officer; currently holds this role with XPO’s logistics segment
  • Angus Tweedie, senior vice president, strategy; currently holds this role with XPO’s logistics segment
The bios for GXO’s planned leaders are available qui.

GXO is primarily targeting organic growth. That said, the logistics industry is extremely fragmented and management will remain open to M&A opportunities that can create compelling value and are achievable as an investment-grade company.

The goal of the spin-off is to unlock the full potential of each of XPO’s two business segments. GXO will be the largest pure-play contract logistics provider in the world, with one of the largest global ecommerce fulfillment platforms, and XPO will be a global provider of transportation services, primarily less-than-truckload transportation and truck brokerage.

The separation will create two industry-leading, independent public companies with distinct investment identities and clearly delineated service offerings in vast addressable markets. As separate entities, each company will be better positioned to pursue its own growth opportunities as its customers demand faster, leaner, smarter supply chains to meet the expectations of their end-markets.

Furthermore, each company is expected to have greater earnings potential, with an independent corporate strategy and distinct profit drivers, and will be able to effectively allocate resources and manage its capital in line with its strategic priorities. Each company will have a separate equity currency that it can use to closely align incentive compensation arrangements with the performance of its respective business.

To the extent that these expected benefits of the spin-off result in greater investor demand for shares of XPO stock and/or GXO stock, it could cause each company to be valued higher than its current multiple, including higher than its publicly traded peers. Any such increase in the aggregate market value of XPO and GXO following the separation, over XPO’s market value prior to the separation, would benefit XPO, GXO and their respective stakeholders.

The expectation is that GXO will be rated investment-grade from day one, with XPO to follow.

With the public Form 10 registration statement filed with the SEC on June 9, 2021, the key steps remaining from a process standpoint include these, among others:

  • Issue debt for GXO and finalizing any required refinancing of XPO’s debt, subject to the satisfaction of XPO’s board of directors.
  • Apply to list GXO’s stock on the New York Stock Exchange under the symbol “GXO.”
  • Appoint a board of directors for GXO.
  • Receive a tax opinion from outside counsel.
  • Receive final approval from the XPO board of directors.
On the systems side, the technology separation is fairly straightforward:

  • IP assignments and perpetual source code licenses will make it possible for GXO and XPO to utilize the proprietary technology developed for their specific service offerings.
  • Transition service agreements (TSAs) will cover the appropriate period after the spin-off to ensure a seamless transition.
  • XPO expects to complete the GXO spin-off in the third quarter of 2021, subject to various conditions. There can be no assurance that the spin-off will occur or, if it does occur, of its terms or timing.

    Proven Leadership

    Brad Jacobs, Chairman, GXO Logistics


    Brad Jacobs

    Malcolm Wilson, CEO, GXO Logistics

    Chief Executive Officer

    Malcolm Wilson

    Richard Cawston, President, Europe, GXO Logistics

    Presidente, Europa

    Richard Cawston

    EP About Us final

    Presidente, Americhe ed Asia Pacifica

    Eduardo Pelleissone

    Mettetevi in contatto con noi

    Investor Relations

    Angus Tweedie

    +44 7929 652 454

    [email protected]

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