XPO reports solid third quarter earnings results

Earlier today, Greenwich, Conn.-based less-than-truckload (LTL) carrier services provider XPO reported sold third quarter earnings results amid what it described as a soft freight transportation environment.

Quarterly revenue, at $1.98 billion, was up 2% annually, and adjusted earnings per share fell 7% annually, to $0.88, topping Wall Street estimates, at $0.66.

XPO officials cited various growth drivers that factored into its quarterly earnings revenue growth, including higher tonnage per day and yield, excluding fuel, in the North American LTL segment, which was partially offset by lower revenue.

“Our third quarter results exceeded expectations, with solid growth in revenue and profitability, and strong forward momentum,” said Mario Harik, chief executive officer of XPO, in a statement. “We delivered year-over-year revenue growth of 2%, and adjusted EBITDA growth of 6%, with 50 basis points of adjusted EBITDA margin expansion.

In North American LTL, we’re improving every aspect of the business that impacts customer service and value creation. Our third quarter adjusted operating ratio of 86.2% improved sequentially by 140 basis points, and outpaced seasonality by 370 basis points. This was driven by gains in volume, pricing and labor productivity. Our damage claims ratio was a company-best 0.4%—a significant improvement from 1.2% two years ago, when we launched our LTL 2.0 plan.”

Harik我也观察到XPO捕获更多的份额n the quarter, as customers responded to its focus on service and investments in capacity. And he added that XPO’s yield growth, excluding fuel, accelerated to 6.4%, which he noted reflects the benefit of numerous pricing initiatives underway, with the company expecting to further accelerate yield growth in the fourth quarter.”

“It’s exciting to take large steps forward across the business as we execute our plan,” said Harik. “We’re making excellent progress, and I’m confident that we’re still in the early innings of realizing XPO’s full potential.”

An XPO official toldLMthat in North American LTL, the company is improving every aspect of the business that improves customer service and value creation. To that end, she explained that XPO captured more share in the third quarter as customers responded to its focus on service and investments in capacity, with XPO seeing third quarter shipments seeing a 7.8% annual increase, with tonnage per day down 3.1%.

This was also evidenced by other key operating metrics cited by XPO, including:

• XPO’s ongoing investments in network capacity, which allowed the company to successfully onboard incremental freight during the industry disruption in Q3, while continuing to meaningfully improve service; and
• its damage claims ratio was a company-best 0.4%, which XPO said was a significant improvement from 1.2% two years ago, when it launched itsLTL 2.0 plan