GXO Logistics, Inc. (NYSE:GXO) Q2 2023 Earnings Call Transcript

Baris Oran: Sure, it’s Baris here. We see about 200 to 300 basis points higher margin in the automation. And many of the new projects, Bill has mentioned, there’s a lot of automation involved. Even if it is take over in place first time outsourcing of the existing facility. Over time, we implement automation in those facilities. So, they do become automated over time. That’s one of the drivers of our productivity and also we have been very conscious of our cash and capital expenditure on those. And when our customers see that these payoff beautifully, they are actually willing to give us longer term contracts and also sometimes take the burden on themselves as well. So it pays off beautifully for them. And it is making our contracts like much stickier, margins higher and we create a lot of value, so we capture more value.

Jeff Kauffman: Baris, thank you. That’s my one.

Baris Oran: Thank you.

Operator: Ladies and gentlemen that is all the time we have for questions today. I’d now like to hand the call back over to Mr. Wilson for any closing remarks.

Malcolm Wilson: Thanks, Daryl. And thanks again for hosting our call today. We appreciate it. GXO, we’ve now delivered a strong first half to 2023 and have now raised our 2023 adjusted EPS and EBITDA guidance twice. And importantly, we got great confidence on the delivery of our 2027 target. Whilst the macro is not providing much of a tailwind for underlying volumes, we’re really excelling in everything that we’re controlling. We’ve delivered record wins and have a very exciting pipeline for the future. Growth opportunities are abundant in our business. This sets us up for a great 2024 and through delivering strong EBITDA and EPS and returns for our shareholders, we expect all of these benefits to continue. Our results today and our upgraded guidance shows that GXO is proving itself a resilient growth leader.

In no small part, this is down to all of our teams focus on delivering a best-in-class service to our customers and helping them to navigate the current environment. With that, we’ll bring the call to an end. I’d like to finish by wishing everybody a great rest of the day. And I thank everybody for your attendance to the call. Many thanks.

Operator: Ladies and gentlemen, this concludes today’s teleconference. Thank you for your participation. You may disconnect your lines at this time. Have a wonderful day.