GXO Logistics (GXO) Q2 2024 earnings summary

Executive summary

• Q2 2024 revenue reached a record $2.85 billion, up 19% year-over-year, with 2% organic growth, driven by the Wincanton and PFS acquisitions and organic expansion in the UK and Ireland.

• Net income was $39 million, down 41% year-over-year, impacted by higher transaction, integration, and litigation costs.

• Completed the $958 million Wincanton acquisition, expanding presence in the UK, Ireland, and Europe, and targeting $55 million in synergies.

• Signed $270 million in new business in Q2; sales pipeline at a 12-month high of $2.3 billion.

• Reaffirmed full-year 2024 guidance and remain confident in 2027 targets.

Financial highlights

• Adjusted EBITDA for Q2 was $187 million; free cash flow reached $31 million, and operating cash flow was $115 million.

• Diluted EPS was $0.32; adjusted diluted EPS was $0.55.

• Net leverage at 3.1x, with net debt at $2.3 billion and expectations to reduce to 2.5x by year-end and below 2x by end of 2025.

• No debt maturities in 2024; $1.4 billion liquidity available at end Q2.

• Operating return on invested capital was 32% in Q2 2024.

Outlook and guidance

• Full-year 2024 guidance: organic revenue growth of 2%–5%, adjusted EBITDA of $805M–$835M, and adjusted EPS of $2.73–$2.93.

• Expect EBITDA to free cash flow conversion of 30%–40%.

• 2027 targets: $15.5B–$16B revenue and $1.25B–$1.3B adjusted EBITDA.

• Anticipate stronger Q4 due to easier comps and higher new business contributions.

• Sufficient liquidity and cash flow expected to fund operations and obligations for at least the next 12 months.