EXHIBIT 99.2
Investor Presentation
August 2012
Disclaimer
This presentation contains, and XPO Logistics, Inc. (the “Company”) may from time to time make, written or oral “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements, other than statements of historical facts, made in this presentation that address activities, events or developments that the Company expects or anticipates will or may occur in the future, including such things as future capital expenditures (including the amount and nature thereof), finding suitable merger or acquisition candidates, expansion and growth of the Company’s business and operations and other such matters, are forward-looking statements. These statements are based on certain assumptions and analyses made by the Company in light of its experience and its perception of historical trends, current conditions and expected future developments as well as other factors it believes are appropriate in the circumstances. In some cases, forward-looking statements can be identified by the use of forward-looking terms such as “may,” “will,” “should,” “expect,” “intend,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “potential” or “continue” or the negative of these terms or other comparable terms. Investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve significant risks and uncertainties, and that actual results may differ materially from those projected in the forward-looking statements. Factors that could adversely affect actual results and performance include, among others, economic conditions generally; competition; the Company’s ability to find suitable acquisition candidates and execute its acquisition strategy; the Company’s ability to raise capital; the Company’s ability to attract and retain key employees to execute its growth strategy; the Company’s ability to develop and implement a suitable information technology system; the Company’s ability to maintain positive relationships with its network of third-party transportation providers; and governmental regulation. Additional factors that could cause actual results to differ materially from those projected in the forward-looking statements can be found in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2011, and in the Company’s other filings with the Securities and Exchange Commission (the “SEC”). This presentation should be read in conjunction with the Company’s filings with the SEC, which are available to the public over the Internet at www.sec.gov and the Company’s website www.xpologistics.com. All forward-looking statements made in this presentation speak only as of the date of this presentation. All forward-looking statements made in this presentation are qualified by these cautionary statements and there can be no assurance that the actual results or developments anticipated by the Company will be realized or, even if substantially realized, that they will have the expected consequence to or effects on the Company or its business or operations. The Company assumes no obligation to update any such forward-looking statements.
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Overview and Growth Strategy
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The XPO Growth Strategy
Disciplined focus on creating shareholder value
Build a multi-billion dollar, non-asset based, third party
logistics business
Primary focus on truck brokerage
Execute selective acquisitions and cold-starts
Optimize operations company-wide
Apply best practices with highly skilled management team
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Bradley Jacobs founded and led four highly
successful companies
Amerex Oil Associates: Built one of world’s largest oil brokerage firms
Hamilton Resources: Grew global oil trading company to ~$1 billion
United Waste: Created fifth largest solid waste business in North America
United Rentals: Built world’s largest equipment rental company
United Waste stock outperformed S&P 500 by 5.6x from 1992 to 1997
United Rentals stock outperformed S&P 500 by 2.2x from 1997 to 2007
Bradley Jacobs
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A Large Market Opportunity
Sources: American Trucking Association, Armstrong & Associates, EVE Partners LLC
Worldwide logistics: >$3 trillion
U.S. logistics: &>$1 trillion
U.S. trucking: ~$350 billion
U.S. truck brokerage ~$50 billion
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Truck brokerage sector is growing at 2x to 3x GDP
Long-term outsourcing trend; short-term cyclical headwind
Brokers add efficiency to both shippers and carriers
Shippers gain access to hundreds of thousands of carriers
Carriers gain access to millions of loads
$300 billion of loads each year do not presently utilize brokers
15% Brokerage Penetration Likely to Increase
Sources: American Trucking Association, Armstrong & Associates
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More than 10,000 licensed brokers in the U.S.
Only about 25 brokers with more than $200 million in revenue
Large potential acquisition universe
Lack of working capital can motivate sellers
Truck Brokerage Is a Highly Fragmented Market
Sources: Armstrong & Associates
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Capitalize on attractive acquisition universe
Focus primarily on truck brokers
Target initial sweet spot: $20 million to $200 million revenue
Rapidly scale acquired companies
Provide access to centralized carrier capacity in Charlotte
Move onto technology platform
Aggressively expand sales force
Acquisition and Optimization Strategy
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Acquired 32-year old business in May 2012
Operations in South Carolina, North Carolina, Texas and Florida
$22 million in annual brokerage revenue
Highly scalable; plan to triple in size
Completed integration in 90 days
Acquisition of Continental Freight Services
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Acquired 20-year old business on August 3, 2012
Highly scalable brokerage operations in Toronto, Montreal,
Vancouver and Cleveland
$100 million in annual revenue
Strong base of over 1,000 customers
Significant synergies with XPO
Acquisition of Kelron Logistics
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Cold-start plan ahead of schedule
Q4 2011: Phoenix
Q2 2012: Ann Arbor and Dallas
Q3 2012: Chicago, Jacksonville, Montgomery and
Morris County, NJ
Led by industry veterans with strong track records
Targeting 20 locations over the next several years
Cold-starts Are High Return Opportunities
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Provide shared services and carrier procurement
Expand carrier procurement team to 100 people by December
Cover freight more efficiently
Enable sales offices to focus on new business
National Operations Center in Charlotte
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Highly Skilled Management Team Partial list below
Sean Fernandez NCR, Avery Dennison, Arrow Electronics
Chief Operating Officer
John Hardig Stifel Nicolaus, Alex. Brown
Chief Financial Officer
Scott Malat Goldman Sachs, UBS, JPMorgan Chase
Chief Strategy Officer
Gordon Devens AutoNation, Skadden Arps
General Counsel
Mario Harik Oakleaf Waste Management
Chief Information Officer
David Rowe Echo Global Logistics
Chief Technology Officer
Troy Cooper United Rentals
SVP, Finance
Greg Ritter C.H. Robinson, Knight Brokerage
SVP, Brokerage Operations
Lou Amo Union Pacific, Odyssey Logistics
VP, Carrier Procurement
John Tuomala Compass Group
VP, Talent Management
Marie Fields C.H. Robinson, American Backhaulers
Director of Training
The full management team can be found on www.xpologistics.com
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Optimize Existing Operations
Expedited
Transportation
Non-asset based
expedited service
provider through
Express-1, Inc.
Non-asset based
ground, air and ocean
freight forwarder
through Concert Group
Logistics, Inc.
Freight
Forwarding
Truck
Brokerage
Non-asset based
premium freight
brokerage services
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South Bend operation good example of cold-start opportunity
Minimal upfront investment
Grew to approximately $30 million in revenue after three years
Add salespeople to continue growth
Truck Brokerage
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Top 5 in domestic expedite
Grow business in attractive sectors
Cross-border Mexico
Temperature-controlled
Defense
Opened new hub in Birmingham in August 2012
Positioned for shift in manufacturing to the southeast
Expedited Transportation
Source: Company data
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Currently a $65 million player in a $150 billion market
Significant opportunity to grow market share
Added locations in Los Angeles, Charlotte, Atlanta and
Newark in 2012
Currently 27 stations
Plan to build footprint to 35 stations over two years
Freight Forwarding
Source: Company data
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Differentiate XPO through superior technology
Rolled out first phase of platform in March 2012
Added pricing tools in July 2012
Purchase transportation more efficiently as data pool grows
Scalable Technology Platform
Source: Company data
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2011 revenue: $177 million
2012 target: $500 million revenue run rate by year-end
Sufficient liquidity for acquisitions, cold-starts and infrastructure
$191 million cash, zero debt as of June 30, 2012
Marketing new accounts receivable facility
Key Financial Statistics
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Management team aligned with shareholders through equity
ownership
Management owns approximately 53% of the company on a
fully-diluted basis(1)
Incentivized Management
Common Stock Equivalent Capitalization (Shares)
Common Shares 17.7 million
Preferred Shares 10.7 million
Warrants (Strike Price $7 per share) 10.7 million (5.8 million dilutive) (2)
Stock options and RSUs 1.0 million shares
Fully Diluted Shares Outstanding 35.1 million shares (3)
(1)After exercising warrants and stock options
(2)Dilutive effect of warrants calculated using market close price of $15.28 as of August 20, 2012; total warrant proceeds of $75 million.
(3)Fully diluted share count includes 5.8 million shares in respect of 10.7 million warrants priced at $7.00 per share.
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Conclusion
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Large, growing, fragmented industry
Significant value creation through cold-starts
Strong pipeline of acquisition targets
Scale up existing and acquired operations
Highly experienced management team aligned with
shareholder interests
Summary of Opportunities
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