E-commerce growth boosts XPO Logistics’ fourth-quarter results

XPO Logistics reported stronger-than-expected profits and revenues in the fourth quarter, as a surge in online shopping drove demand for the company’s logistics and delivery businesses, pushing its Q4 and full-year 2016 totals beyond analysts’ expectations.

For Q4 of 2016, revenue increased 10 percent, year-over-year, to US$3.68 billion. Fourth quarter net income was $27.3 million for the quarter, a significant reversal over 2015’s net loss of $62.8 million. Adjusted EBITDA for the fourth quarter of 2016 improved to $291.1 million. This compares with $217.6 million for the same period in 2015.

Bradley Jacobs, chairman and CEO of XPO Logistics, said the company generated the strongest growth in last-mile and contract logistics, driven primarily by e-commerce, which offset “a weak intermodal environment.” He added that his company’s less-than-truckload operations in North America “capped an outstanding year with a 40 percent increase in fourth-quarter adjusted operating income.”

One area of growth has been XPO’s “white glove” delivery service, which handles bulky and heavy items, such as furniture, a market that e-commerce is clawing away from traditional brick-and-mortar stores. “We’re benefiting from the tailwinds of e-commerce,” Jacobs told the Wall Street Journal. He explained that, as online sales grow, “our business increases, and we’re also getting an increasing amount of their business as their prime supplier.”

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