Q1 XPO beats expectations again
Greenwich based-XPO Logistics has seen its stock price nearly double over the last year. It’s happened as the transportation and logistics giant has repeatedly beat quarterly earnings expectations, the most recent quarter included.
The company released its first-quarter results Wednesday, highlighting record-setting numbers for revenue and new business, which totaled $972 million for the quarter. XPO’s revenue grew to $4.2 billion, an increase of more than 18 percent since last year.
“It was a great quarter — it’s a good sign when we’re above expectations,” CEO Bradley Jacobs told Hearst Connecticut Media in an interview. “Since the beginning of the year, we’ve been launching one innovation after another for our customers.”
Jacobs has cited frequently XPO’s technology investments as a competitive advantage. Over the last few months, XPO has announced XPO Direct, which prompted many questions from investors Thursday; XPO Connect, a cloud-based platform for freight shippers; and a security robot C3-XPO, which Bradley described as a “little Star Wars character” that patrols XPO facilities and cuts down on security costs.
Some investors questioned Bradley about the goal for such “incremental” investments. They show that he’s building the business to be successful long term, he said, adding “We’ll continue to invest at industry-leading levels in things like technology. ... These innovations should propel earnings growth into 2019 and beyond.”
Now nine months since XPO shared plans to earmark billions for potential acquisitions, Bradley said he hopes to close at least one deal by the end of 2018. “Our plan is going as expected,” he said. “We’re on track to close one or two transactions by the end of the year. That was the original plan and it’s moving along.”
He’s considering companies doing “the same, similar or adjacent business,” as XPO, he said.
Acquisition plans could be announced in “three weeks or three months,” Bradley told investors, “but it should be by the end of the year. ...We cast a wide net to talk with lots of potential acquisition targets.”
Looking ahead, Bradley re-emphasized his confidence about XPO’s potential for continued growth. “Absent of some geopolitical event, things are looking good,” he said.
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