The e-commerce boom, paired with a blockbuster intermodal contract, led XPO Logistics to release robust financial results for the first quarter of 2018. However, the fact that profits for the previous Q1 were modest, by comparison, also helped.
Bradley Jacobs, chairman and CEO of XPO Logistics, said that e-commerce growth translated into strong last-mile and contract logistics business for the company. “And our intermodal unit won the largest contract in any business line in XPO history,” he said. Logistics Management reports the contract in question was made with Fortune 50 company, but the name of the company has not been revealed by XPO.
XPO reported that net income increased to $67 million for Q1 2018, an impressive 325 percent increase from the same period last year. The contrast was primarily caused by XPO’s heavy investment in the trucking sector of its business, which cut into its profits in early 2017. To that end, XPO Logistics launched an e-commerce distribution platform last month for its trucking and last-mile services.
The company’s logistics sector’s adjusted EBITDA rose from US$87 to $112 million in the interim – a 29 percent increase. This is a 13 percent increase from $99 million, year-over-year.
The company reaffirmed its full-year targets for adjusted EBITDA of at least $1.6 billion for 2018. Bringing in $330.2 million Q1 2018 means it’s accomplished about 20 percent of that goal so far.
We can expect that the company will continue investing substantially in the future, Jacobs said, adding, “We’re making disciplined investments in innovation and sales to propel long-term growth.”