GXO Logistics (GXO) 5 Nov 242024 Q3 Earnings call transcript

Welcome to the GXO Third Quarter 2024 Earnings Conference Call and Webcast. My name is Rob, and I'll be your operator for today's call. [Operator Instructions] Please note, this conference is being recorded.

Before the call begins, let me read a brief statement on behalf of the company regarding forward-looking statements, the use of non-GAAP financial measures and the company's guidance.

During this call, the company will be making certain forward-looking statements within the meaning of applicable securities law, which by their nature, involve a number of risks, uncertainties and other factors that could cause actual results to differ materially from those projected in the forward-looking statements. that in actual the factors materially to of contained is company's discussion could results cause differ A SEC filings. in are of except to statements on update any has forward-looking the extent forward-looking release to earnings The statements, these or no this obligation call and required made today, as the of only the company company's made by law. rules refer to as applicable SEC measures certain defined financial may during non-GAAP also call. company The the under measures website. GAAP contained measures related to the company's of release in Reconciliations non-GAAP earnings comparable the such financial financial most tables are and the on its Unless this the in all otherwise United stated, results call are on States dollars. reported The to company what to it that its also assumptions. you today date guidance incorporates and remind business believes trends appropriate will be

and unpredictable many and affected global market exchange inherently materially is supply its and inflationary economic predict its foreign pressures in labor constraints, detailed actual the services, are factors, fluctuations changes demand to materially be by guidance. in rates, and possible global and results chain consumer demand the not conditions may SEC. results company's spending actually for including from and The therefore, in company with filings differ for could the various factors It

copy website. a You will of in measures contains statements release, earnings and financial company's important which the find of information company's additional non-GAAP forward-looking section regarding the the Investors

Jo Executive Malcolm Officer, Chief to Wilson. you over call the may Wilson, turn begin. now I'll Mr.

EBITDA, business, have record a growth. Kubacki, acceleration appreciate stellar our good Chief including increasing are you sequential our revenues GXO XXXX momentum for has I Barish and quarter, us Greenwich Christine third morning, call. Strategy our our Officer; third and in earnings everyone. delivered and Financial we've Thanks, Officer. me . Rob, in organic quarter joining continued in our posted With we today adjusted Aron, Chief

business of signed During wins. million new quarter, the we $XXX

automated. Zalando partnership recently L'Oreal. We Jim Guess, and France, largest outsourced Shark, continue and highly our top with grow the expanded LG together e-commerce in with to We've opened is warehouse brands like which

XX% over level has now more of sales at and its highest years. than high-quality X year-over-year Our stands in pipeline billion grown $X.X opportunities,

the got new business projects third expect the GXO. the major business won that of for We've to a of has for year-to-date. of being quarter, fourth about $XXX wins several new sign the we million XXXX As end record-setting making of quarter. year in we've

we as this Looking ahead fourth to we're the saw levels bottom year's season. into e-commerce ready the the cycle accelerating. normal fourth of we we're the that head We've peak seeing is to year capacity for last of quarter, demand peak in inventory inventory mentioned the quarter for and returning

reliable been satisfaction most are provider high top us among customer and by America's scores Newsweek, has ranked dependability recognized Our an our logistics service all-time at the recently which companies.

differentiation our As in activity technology deliver effect picks multiplier commercial AI a momentum, of for deployment through the we customers. the automation our creating and up is efficiencies

few a On our manager supply the are ago. been warehouse award results, proud for a have real-world recognized with in AI weeks by we of chain to leadership back our excellence logistics

is Our differentiation business. technology us also new win helping

site Clipper with In growth. business our in capacity. our driving growth the of full Germany, key at of we've sales the verticals penetrate is XXXX. strong our targeted of in coupled to A ongoing is Dormagen in back Our hard and long-term acquisition our performance, jump-started geographies M&A on state-of-the-art

public grown Germany. opportunities several business our Wellness announced the PFS billion successful in attractive we $XX sector. and and of & We're had of will of accelerate in Europe back start-up of industrials May, More Beauty acquisition a and Wincanton strong XXXX, other we acquisition Similarly, enable Levi's note deal a in pipeline the cornerstone recently contract leading our our like Glossier with aerospace in our leading on us Pie, to U.S. to L'Oreal. with signed Beauty recently, We've provider. pleased believe that that growth we've of a have including with in aerospace, brands, we've a we verticals

this guidance for year performance, of strong we're reaffirming continued our light In full XXXX.

through have We build trough, the and clear we evidence we're here. from to intend

in growth further up Looking expect the the an acceleration we with XXXX, in ahead, Continental our ramping all leading automated pack large warehouses. several Europe of of X regions. across is and growth Germany

our and sales and target. business our XXXX us multiyear performance strong in contractual outlook Our give model long-term confidence growth

now and reaffirmed guidance. will through Barish, to walk Barish our quarter you over the you.

$X.X Malcolm. of billion. quarter, record we Good In generated morning, third the revenues Thanks, everyone.

year-over-year our growth growth organic target of to to move are saw the the start-ups X%, $XX we revenue new quarter, growth of million $XX.X line means XX% quarter, In to The we growing throughout trajectory Our on reflects meet track of sequentially of has XXXX. as revenue we into accelerated XXXX top contribution million. each year. improving expect the we which continue and facility it

at quarter record million, EBITDA a $XXX year-over-year. this adjusted XX% also Our was up

also seen year, expansion expect sequential we to network. to uplift a space as this margin and our have We a we multi-tenant throughout see due margin better continue the trend utilization in

increase earnings share year-over-year. $X.XX, cash of X% was diluted up of per million Year-to-date, flow from which XX% $XXX operations, delivered is year-over-year. adjusted we Our have an

we $XXX conversion XX% cash the on Our adjusted million, to free is for over flow are year. track full cash free EBITDA flow to year-to-date deliver and

projects invested we capital strategy. remains our our on in organic as well growth, with to high-return return in revenue continue operating above our target allocation line Our to XX% invest fuel capital at

sheet our X.Xx quarter, is stronger quarter. of balance growing leverage the third from was net of X.Xx last as Our the down end

leverage the this of to expect end by levels year. We X.Xx around X.X of

end excitement Wincanton expectations, debt Wincanton pre-deal about of and after XXXX. above performing acquisition reinforcing our As paying Xx is down double-digit growth prioritize about by and revenue acquisition. you delivering this the our

the XXXX accelerating our be is Wincanton. will agenda. of Our short-term organic our on and focus M&A not in growth integration

to to conversion of X%, We adjusted EBITDA share free X% $X.XX. to year, EBITDA of guidance. deliver XX% This are and $XXX reaffirming to flow our to million per earnings growth expect organic of cash to XXXX adjusted $X.XX XX% diluted $XXX million, adjusted of we revenue

above operating an to on XX%. We continue of capital return invested deliver also to expect

We are executing framework. value creation on well our

a secular deliver revenue, value. invested the and growth return EBITDA diluted We throughout in laser adjusted per focused and on cash As adjusted flow remain operating we creating share shareholder cycle. predictable growth resilient earnings enterprise, long-term on capital

that, to With Kristine. mic the over pass I'll to you. Kristine,

we're automated operate an like morning, attractive automation how update Today, Good results in Barish. to differentiation and supply market e-commerce, resilient macro Thanks, complexity, We accelerating growth GXO's reinforces with tailwinds seeing quarter. parts These our our our growth everyone. have and cycle, in continue increase. pleased outsourcing needs an they're for including on and outsized our chain by this driven trajectory that's We're automation. customer across with to you secular different trends growth trends algorithm. the the confidence I'd solutions scaled as long-term driven of

the This over an seeing commercial e-commerce a the tailwind activity. years. has X/X uptick of past by an X structural today sales over as First, proportion in all is growth that trajectory. more returns grow industry online from key shopping level, we're about At for a is been structural percentage long-term retail driver us growth come expected to points its e-commerce XX decade this than next and to

fulfillment. XX% own from our translate effect new in into third quarter wins sales of the results. our this seeing e-commerce We're originated

like more of made business is of wins from of up scaled on our our increasingly pipeline About This supply chains to for driving tech newly have Customers looking date become experts new has and around relying an and for fulfillment X/X are this $X.X to more the as outsource GXO. logistics activities. complex, billion time. of XX% outsourcing forward year Second, been come outsourced first business, customers acceleration

scale The is of a acceleration and supply in and it partner from market e-commerce, us growth the We're customers with customers scale, in in their complexity. to to and fulfillment to is expertise in efficiency the a recovery part look these tech-enabled unlock trends drives well of leader for value capture to of chains. to automation. of ability outsourcing because come manage and positioned GXO global the and drive result our automation

our proprietary been months, has in AI several in GXO application Over the U.S. warehouses select piloting past the first

tool of the The in the near Our highly team flows and learning our to tool inventory produces by our the to the streamlines our predict insights These optimize volume by demand. of layout SKU machine term. level. down to with warehouse fulfillment analyzed processes forecast using customers' data operations sheer accurate of SKU resources demand enable match

have in stock additional pilots far X XX% cost. drives our initial increased which X% levels X% capacity replenishments, Our no delivering to and Xx accuracy of improvements predictive productivity above at to exceeded of expectations,

leadership in growth. are driver our next with run it space We're footprint. early a thrilled the is scaling we're of over long-term way change and profitable AI AI, and of years. our few the our success warehouses across is going to key this the

with Malcolm. I'll over back hand that, And it to

half the Kristine. Thanks, revenue quarter. We've first and adjusted and third from EBITDA in on the delivered built our momentum record

Our long-term our record high, at growth we're targets. on business confidence in track of to a a pipeline year deliver and bolstering stands wins, X-year our new

delivering inbound you just quarter, and focused seen on quarter year. in don't the finish media on During acquiring we've may great on have interest a We comment about market had the speculation We're the to strong GXO. speculation.

we'll Q&A. With hand for Rob mic the that, back to

[Operator Instructions] Moore question Stephanie the with of Jefferies. comes from line first today And our

retail of high-level U.S. was on also a of lot the it guess, across This we maybe Europe, hoping into geographies. kind more. is organic some you're could kind growth? kind Malcolm, trends we by versus Joe of on I I Hagan what and on if the maybe terms of industrial, you're a for geography, just trends you're Continental slice U.K. seeing could but across Stephanie seeing of you've what in seeing, talked the unpack thought the about And

Joe. Sure, Yes.

I a thing, first quarter well, good So it's for mean, us.

the what of margins seeing growth results, positive and and When we to regions, regions. top record adjusted is EBITDA organic bottom improve look the across continuing all line X all growth at revenue quarter-by-quarter. So we're

pack. very European countries our well. benefiting growth Continental the in It's the a that's performing of all actually business, of but of surge from leading are Germany, So kind

and business, coming U.K. that's really Our stronger stronger.

for that provided. but Carsten, we're by of of in Richard and rest we've the in normal more the has team, . Overall, that the better I Barish, in I a mean, kind think definitely out of the type to last it's America, myself, from here the we again, months, really feeling of are trend. that growth been have the getting And vertical, recent XX team, vertical a and to trough that metrics. benefited back North we're we're elections look certainty the generally, we

we're we're stronger about pay our talking in strongly investing I year, sales XXXX. at noticed made the sales, the the think there's changing rest to starting of year. we X definitely in is start building close organization the When no fact, And of that about and a the doubt So investments organization for much you'll our dividends. have definitely

So million XXXX. the confidence in and us we're falling that Year-to-date, $XXX the of $XXX And million what's the for our are between in this some quarter, the result good a That's projects number. new there's into business million, hopper it's now business, up shaping year. of anticipating great strong wins sign year. to given about end still already $XXX a that

When have I us. look working business. pretty for defense geographies, terms think done what across all it's aerospace going that in we're verticals the the is and well. last and to Tech seen retail really very much in be we've have Actually, across different of in strong a the year great been quarter, I

the they've a from investment group I in us beverage, of the we've probably because e-fulfillment returning laggard marketplace. amount we're last and of in the think pleasingly We've leader in a been customers seen Food for as Most the projects. quarter. e-fulfillment seen

in signings. projects sales more the in actually, And new the of half number increasing big drove than business quarter, pipeline. our e-fulfillment So of

in I good So think very, all quarter. very all,

across one expansion. productivity I've those And regions. margin seeing got the I think things to improvements amount we new helping coming of Stoch our an up really doubt benefits see that's to comment automation starting one the as year, that recall of from starting Last that's We organization, the to that that impacting that's our our into driving. on of show increased we'll XXXX. because no what are you'll It's Finally, tactical AI. the it's benefits. heading now Adrian with I And like of commenced automation well teams are a progress assist things deployment would of all and that's in

overall, So outlook. good

first business. the generally little time our All of a but for regions well message a doing bit region, varies all positive across of and by our

seat. I from Great my X strength answer, follow-up. by maybe Malcolm. Maybe Surprised the in just Aero, guess,

offsetting are thoughts your potential love you it's new I'm of any drilling could the get about in talk guessing aerospace. on So to strength wins disruptions. -- I would kind

I a the start it's good things, invested Well, the of mentioned, of And Joe. X Yes. heavily as the we out, at call year. listen,

talk the player to is not in skill different things here and and our aerospace. sales, very to strong invested One in defense, So for we and just where two organization, geographical America, those sales North a aerospace them a things a about sets fact long that we in but And also Europe. aerospace into taking process in like defense. gain accreditation particularly it's market, putting are

sure So now Wincanton have of good for rewards combined for incredibly with that is U.K. in place that an a in new overnight set I the We're reputation us. secure have impact. those quite they investments in big that with things allowed don't starting the has putting pleased the X although a aerospace very big It to us about first contract think U.S. a Aerospace. it's new we're to see manufacturer. sign because strategies we're still organization, plus, those very blue-chip When Europe

aerospace, I expansion I'm incredibly block, to things, new we well. well German very of to do do we're the comes Some now, integration huge expansion or the back owe really seeing in these It's we'll on to that do that have sure very in X-year the now place took that. will which of competitors similar kid be a a few But a the years lot and Clipper on Germany XX of see the X even really think market ago. Europe. month that over to a period, we're you going

Our Scott Oppenheimer. line of the next question is from Schneeberger with

year quarter? any trajectory be comparisons seeing, had guided. and would Organic 'XX 'XX appreciated. your you I'd the commentary has you're jump given as to like fourth in And growth here. the progressively been What's level all heading throughout confidence better that from into into

again. Scott, it's Malcolm here

I Let important. me over hand to take that really because the then I'll high Barish really at level, and it's think

So foremost, year. first we've reaffirmed guidance the in earlier our for comments, and our

is Now guidance twofold.

of customers line, incredibly it's outcomes the So a the come clearly, inventory top that's out are of this some relatively in as still coming our different trading year, evidence busy when we season. think a possible our of sales about levels holiday that of Last promotion and was better. seeing subdued range, can doing warehouses wide consequence our year We're work.

proof into as end, getting December. the But the really in will only see we're

wide range on we line. top So sort have of a

in Importantly, high will line, with on we the I think adjusted bottom running our pretty are deliver a that expectations. with much level of EBITDA alignment confidence

close be XXXX business. fundamentals really about confidence our we'll think from I coming the midpoint combination very of is our to fundamentals of And guidance. that full a year

cost-plus proportion we line a businesses bottom our high are visibility reasonable nature boot We due to of models, contracting degree the of have a of of our contracts. or open type

tactical a automation more and mentioned, a of amount of bigger as all And increasing also, deployment AI of we and been part. creation more I driving, lot of value the the including have playing

it's to it for go big level EBITDA. in worthwhile do And us Barish, QX would comment because is it's another you But just think really Barish I really give value you important. to really in on a I detail, that? of So just think step

environment, was Sure. of an a Scott, inventory from year turnover. QX improvement Last typically, -- our see exception our sales sequential in you to the which QX. would retail low expect the business, on normal and sluggish EBITDA in to because drove

this of year's that year. from last we at lapping expectations, Looking effect are QX

lower they still the customers as we more have seasonally who Although ideally trough. we might . trading normal have are done some than look gone expect have results through we some seeing customers, we like,

our for capacity which been open laser warehouses, which as sometimes QX has from out the multi-tenant underutilized organization. year-over-year managing are focus margin This we is well. a improvement our seeing is addition, area a are in In we

So of network. multiple coming of the the lapping multi-tenant margin The the year and things. better of last improvement utilization from QX

conversion to and just puts the and are address flow was Barish, year. Could XX% you then, regard third full the that for free for strong cash XX% that takes the conversion conversion? flow maintained maybe to cash quarter discuss with just What fourth in you free And Great. quarter. quite your

ability flow for confident our very remain to year. We in free this cash generate

$XXX you As in was results. said, million spectacular QX a

track capital deliver working we on went strong are our XX%, management, diligent expenditures. are Roughly to XX% to of and CapEx. We on our CapEx capital growth very X/X to

investing flow. where for drives are our are We put future, we the That cash on but our CapEx very dollars. selective free we

line the question Wetherbee Chris Wells with is Fargo. next from Our of

I wanted that the made. to touch margin fourth comment on you quarter

could some I how are that. about coming can Can Wincanton about I with maybe about sequentially, sounds I'm little up improvement guess, of II, margins exactly bit get Phase things. that news I it can the fourth in we you Phase you a that. you some So that? then to part or of think up sequentially. outline I this probably couple of talk think potential be later the I help know when week. maybe for guess guess synergies some get also not sure like and going And the the a year-over-year? up coming there's you we quarter, guys dynamics

the aspect here. Wincanton of more Malcolm to me it's the you terms I'll Barish Chris, on point, detailed in margin. hand the over and let Look, cover

Phase Wincanton, So X clearly, reviewing the Friday. we're decisions across that last the decisions, came

we the collaboratively reviewing constructively at we're And the we're have clearly, other So on CMA. very to engaging detail going and as projects, moment. that in be with

potential by the this going the pretty And possible to all that mean, And of a into an II. I size we to go into go bring. of we'll to for that Phase were outcome way, might remaining it's uncommon II. we're it's prepared outcomes a a environment, it. for of not Phase frankly, kind confident deal that positive We're see a

I is wise Barish to think trading as up a mentioned, thing well. it's on good its Wincanton, trading say expectations. performance pre-deal It's

with at as stands integration the moment, commence we had of Wincanton. to very very, So the we're it pleased it. overall planned

any only So impact from effectively positive kind Wincanton would of out margin occur impact January onwards. coming of

-- not if this start really there's show it's coming stage, little whilst actually a more definitely, detail? start any Maybe So on negative a at integration. we that a news Barish, positive the could is drag we aspect you margins Wincanton the from more bit before

Sure.

And the improvement quarter coming sizable a into trend well. Excluding our Wincanton, our quarter, margin look continue margin from of when open-space have quarter, we to coming year. expansion this the our that included every there's expect utilization you they this every every from multi-tenanted QX -- of as to components QX and

a a expansion Additionally, as on to programs, anomaly, from margin. working higher From And we perspective, margin of also and integrating QX to Wincanton's do onwards, is normal are mentioned, QX. expect then synergies. we trends. been we the lot the a moment, expect capture Wincanton [ in than at we start ours you upside and lower Malcolm XXXX supporting when ]a at we have normally, after-tax our of business efficiency was the margins, the Last look lot that have they that's and an but year's QX

helpful. that fronts. appreciate very That's on I Okay. both color

the a pipeline. follow-up quick Just on

that at is up. So a we nicely. has of obviously, sort inflect, of seem I moved interest but it the high seen does pipeline been necessarily a haven't volume We're years. haven't couple like picking in we up guess, level pretty

'XX to there adding guess, here in couple do way this? of you're any to it acceleration of about I But next conversion does pipeline And XXXX. to start an what quarters. thinking are sense to business. rate? I for through guys and guess, conversion of know that kind and the think about sort you want lot beyond, move you in of is contracts Malcolm, a So I think how get the that means about as a we we how speak this view as Just of

Yes, Chris, here. it's Malcolm

twofold. think it's I So

You're up. right, pipeline is

diverse well. a for I as more us think pipeline is bit

their talk you'll That's into activities, in-house existing and during to customer into a still business, effectively we've to outsource existing an 'XX about heard very customers quarters existing lot sought come during have have operation. us stepped the and So effectively where stepping previous relevant. us

been I think guess. the as since uptick pandemic, big little e-fulfillment. also I bit I we've pipeline, in projects quiet seen E-fulfillment for mentioned, more a a in has strategic the

projects. at think, I now to having in going live a start projects And we're But mentioned of or I to frank, automated that to that got and confidence are seeing we've that a investing now. X large is of warehouses our now. projects right number stable greater of will e-fulfillment live we're what that here that's be the customers, sites not level of X there's again, land big we've our moment in fulfilling going prior be got

more mentioned [indiscernible] will earlier just to, pipeline to on verticals they'll and the was it live months amount main progress our have or time, a was now start into ramp take we're those as the probably more investments other the benefit you X associate going for reasonable with But of and we of building I the wouldn't I that made And in seeing up XR. projects fully it thing, they're of So sales what XXXX. sales Scott see may population into to historically, that been think that again, volumes. we think team, in I we

It's in all in. business a pleased all many of coming new of geographic growth with and regions But very we're sign the we're working see in can see we it's very, of to those starting that's it's e-fulfillment. first think bolstered take returning confidence I our the start I our over years, projects. in it economies us will the winning that think that for momentum business we're to projects time, omnichannel the back, been So by bedrock more

pleased be of the we think so deal the aerospace I It's and the many. in will were first, just first why Europe. about That's it

it's of the So us shape a pipeline. given

XXXX. in a I into we're as environment heading think we're healthy

Our next Morgan question Shanker is from line the Stanley. of with Ravi

customers one a I telling views companies that customers think mentioned your season. little the they them might you their on hearing know you bit. in-store into and are seeing similar color your more are that of addressed little And a more versus buying it store buy also, chain love you to peak how Are potentially are [indiscernible] shoppers it agnostic something Would going given online? in But shopping peak compressed between customers? your this position season, collecting be. store in from supply given I

Malcolm Ravi, what these we fully, think omnichannel, Look, that. agnostic business really lot customers where I work in increasingly, about seldom days, a with do to help is here. dedicated efficient we order a are those relatively it's Yes, talk you have of on a maximize, we but mean really the warehouse, When of fully big e-fulfillment we from our that use in sheet. customers warehouse. We make type do a have most balance sites,

or We and picked being pallet and UPS FedEx a whether trailer a are kind to a and designed into type it's organize mall from a bag brick-and-mortar systems it's post onto network. of U.S. put of actually individually our or common and on picked loaded be or and being all a stock, IT into put delivery delivered into to pick our whether packaged to

going comes So probably we resurgence in were we pandemic. I bit are of terms say a returning that's we're good. of across would as our great great And if -- out which think the agnostic into and news. shoppers coming were seeing the we But a are I malls, where that of business, in

the for a of very capacity future have of decisions We lot customers e-fulfillment. putting strategic down about making

that's reestablishing we're consumer for think winners the seeing. definitely what to big I is the of channels the itself one e-fulfillment as So

Understood. That's And very for follow-up. helpful. maybe a

in outbound automation kind Or this of make like technology to [indiscernible]. as X interested X step of of people you piloted been is, back the are you . you are from and go last are to talking with they me the a addressed you've like for kind customers? guys to next months of now What kind level still [indiscernible] Just hearing and in which while. for they this years you've about having call, view call X topic it a those Are real to do and in up?

a here. years. think really Ravi, incubator human-like our customers significantly of is way, to interest humanoid we're an an space, this and recent with where we to in, the a seeing really mean area. are human We will have make a see [indiscernible] decisions. capital it's Kristine lot across No, know, and they're I able think grow they're really in over cases. more have fit X capable for solutions years. category I a across in great robotic from really our the the of value space, potential It's I both a the with tasks Certainly, customers. emerging really And where even existing create as matured to some we're the X dynamic partnering And real-world shape into very to in leaning cutting-edge space use We're therefore, efficient developers program. operational way next you

the facilities warehouse. our In our Agility in in performing visited of robots saw one fact, I Atlanta

fact, quarter, to partner we're working humanoid We're to just this excited last Reflex with and robotics with. another we agility electronic. addition announced this -- In provider in

the So like forefront and fast pace, real-world AI, is piloting at very our centers. in in operations moving space at a this GXO is fulfillment of

tech our a time. over we'll but the space, space. So certainly, differentiation more fuel to say have of this to this about in interest continues And really lot

Our next JPMorgan. the from question with Ossenbeck of is line Brian

Malcolm, maybe actually the looking to just but any few the further asking you looking on it's in days provide at actually what that, document had if see notification you've little you detail context wanted they're what at? Can can you'll for see particular, I been just any is. you know you days CMA. said the resolution, since you get provide had and to comments a confident to terms what a in they're favorable from more feel few I of a now got now you've

Yes, Brian, for yes. sure,

of CMA So process, said, the of a the this good. type to it's a we'll to detailed are it's into CMA basically, process. that for -- It's deal work uncommon more with I size classes what actually no is not clarification environment. go much as in a faced that a about which question environment. verticals U.K. U.K. to some is a on as I'm that. terms of There's It's the the different highly highly equipped competitive probably well comment make market guy, exist And British in to that. competitive And

detailed So coming over will is that the And. the is months teams our situation. to work greatly intention with do help CMA clarify will it us some the think do I what

I a that good process. we'll satisfactory the confident positive we're As outcome secure mentioned, through

One we probably January. will that the it to the where planned the integration business things is of commence in of evolve early had

because second think say I don't stretching I delay moment respect might a raised. really think they expectation work it's beyond that they've process the out that, to that and seek probably points on our a them fair the do see it's And that's we to on into quarter. quite with but of to we that CMA, a job. the beginning correct that the proper we good at clarification the have

a the a mentioned been That's then for follow-up Barish, utilization efficiency guess, it's for improvement. multi-tenant Okay. you helpful. And -- pretty seems like several warehouse factor times. I It the margin big

as this that's like to potentially for to bit guess, with a into year is that bigger little this, Are in a push there going with So leases done potentially give can what's putting more more do have backdrop letting the anchor you tenants? market? you I are rethink go go volume. of EBIT this And back these to you little detail strategic you're be there terms actually happening more a on better year? here the Or you throughput next

and it have the organization, our development filling refocused -- multi-tenant invested results in far. capacity heavily our available so on business is organization, quite we and organization sales Yes, good giving us network, and

results. us been space quarters. with that's and hired throughout So we our that's anchor couple giving number have a available of last the tenants of

have also looked our those consolidate to our base. that and those leases renew leases not operations opportunities coming We an reduced to the end into or to into facilities existing were when cost

So but these that primarily driven both filling sales of results. coming and has space from focus factors our the

of The Barclays. Brandon from next question Oglenski the with is line

get new the Is speak competitive backdrop around I the if more, was as deals. contract just it you you or competitive wondering of could discussions? guys to especially less more automated into getting pricing

It's Malcolm here.

that. Let me comment on

been have changes really year seeing the really not or X. for any we've think we I So what seen past to

So that smaller and credibility, very typically a the be to we reliability what the aspects a solutions way, that's our reliability. about the of article provide there's level pleased by lower for generally, the and to automated solutions, Newsweek were experience, group we able is mentioned the -- in have are have why organizations see

seeing company when We're as it up a highly reliable large-scale to facilities. comes big, automated standing

deal lesser in the of recognizing of capital-wise both generally The for largest It's It's gone us, competitors that projects. of a in time the just big those for automated typically, of mean, go that a facility with I a France, for number facility and level into think deal customer. live market. customers big for the wanting there's we've it's longer a investment, starting commit I big like projects. that those in the And periods high France. to intellectually So deal

So a of lot kind landscape of competitive projects think of I is into huge there's people. those time -- not numbers goes

manual make of about of type we see competition sales for business proposals there's added When of a margins future, we're as kind as activities. that we, But If low our to everything for better slightly business. with And at that of pipeline, as value able of the it's pretty why when reasons the the much we law with as of we're enjoy really again, it's business through more really traditional company, activity, go we X It's get typically, more growth. to is customers. solution. more focused are amount business greater manual tech, our coming automation a kind about the on. sales our a look not traditional bedrock think than that warehousing a Clearly, that manual not we kind I the think on our when of dealing

I appreciate some improved of that, core your year. Malcolm. throughout in, volume Have definitely maybe And had closer customers guys then off last with a the core fall year. growth volume you

and fourth that looking quarter? think the is I has that been case into better the

Yes.

ask Let comment me to that. Barish on

Yes.

volume but will throughout number, every improving be do than quarter. as QX, on QX consolidation negative it the in . existing well. as gradually environment and from volume we QX. network into the has facilities impact and still volume And been will a It a much of be we expect improvement further year better the coming our Our look

Bascome line with the of Majors is Our next question from Susquehanna.

in, growth or XX in a the continue feels at there together, there as you of that been call long-term in out recover, commentary buckets I the Taking next back you are get -- Can it as us with you year all XX% of really positive that be that implied plays it reiterated big to it, months. scenarios thinking the like is guidance where walk you're to some of this through it's actually to is if level volumes just cyclical could XXXX, how in growth XXXX? mean organic bridge year organic is the and

improvement here. business an been our facility Barish but volumes, quarter, and in seen also has existing Every it's development that our growth have and investment by sales supported organic Bascome, we capabilities. our

trend that into to XXXX onwards. expect We continue and

expect year, our clearly since then. compared to been going was an of XXXX QX in growth the do last we So we XXXX. acceleration have And and bottom upwards

growth, an we far organic our do As as see acceleration.

going developed are our on earnings the we further clearly direction We be commentary up. guidance, is but then to the QX . providing

next is TD Cowen. with Seidl line the The of Jason question from

Kristine. Barish, Malcolm,

be change, reiterated is resume shelled at that? term Or positive we appetite You I of when the walk the least are the follow-up, you're say in you M&A e-commerce near in confidence half quarters? XXXX X for something about is talked going 'XX to maybe your Has guide term, trends? this to then, growth seeing is to and back given maybe the talking is back your some some near next Dan, organic that And this that you morning. on a coming guess, more

Barish It's here.

term term, is in organic debt Our gives capital. near returns in phenomenal shorter which invested paying on and down growth, primary investing us our focus our the

We expect it's XXXX, to that the order about to continue and in of the remainder the talk XXXX. of into onwards of earlier part rest XXXX

acceleration we back an our do clearly, XXXX growth. Going to plan, in our see

EBITDA us contribution and track. about third plan, take components expecting the We second on same bucket to remain are in automation, our the technology of business are our is the bridge and growth, That bucket. Wincanton and in and our XXXX synergies and and are we development productivity projects excited basically should the adaptive acceleration very coming new core from from the we our the

you positive business. If could talk on us I the you meat here. give give returns bit -- commentary about things. us the a in and Can more one about you helpful. said the really That's throw more little some Can bone very e-commerce of side

Yes. here. it's Sure, Jason, Malcolm

tend an obviously, our business. to out e-fulfillment. is of returns, part It's very much map integral think I e-fulfillment. returns We to So aligned

in since negative in So over range we've XXXX, I our where several of we us, which for volumes of of working do have quarter of across context XX our the been as customers, really last a a wide the volumes. customers a was you bit of last quarter trough recall, -- months, if of in big feel the really, like really

and a was lack of It a lack of inventory levels. holiday

returns as in gradually terms of our we'll seen confident we've back, see lift that I'm coming in customer So terms our business. correcting same volumes, business of volumes that

in seeing returns processing much of utilize. And really good our our That's minded the you not specific of volume obviously, with terms What amount an wheelhouse, [indiscernible] imposing in any the return efforts evidence returns, for actually is down of the technology change returns. really don't return are returns, I the business. those the actual worth of the over of the read have maybe of et number maximizing the retailers established more detail the see right that cetera. some goods, seeing and amount the centers of have in process. that et cetera, of of a We that's lower of really of our being making to individual the we year, costs speed in customers trend know will We us. for we for return customers. of of We're

generally, it So best I Zalando back, processing as as with to to proportion with come warehouse, out projects see and work customers the from starting we reemerge, mentioned, to e-fulfillment the signed, be our a of ready that. think, starting goes to be of that we'll project make we what will

from Our next Ariel the Citigroup. is question Rosa of line with

Or return the e-fulfillment force? investment talk to a election and could from that I'll talk little you I'm lot obviously, organic you the So if it's And happening to that hear dig to you into encouraging do its Malcolm, little GXO's this. latter, And market? waiting related about think more demand I give if what demand? surprised think driving hear related a that some why maybe customers is to in you of that I'm some a of it's Is sales of talk about curious very U.S. customers. bit bit is. of would the today, just maybe more you and would given context kind the of you on outcome election. be that the it's could to see about that think own

driving then So investment there. risk you that of about kind election talk and also maybe could what's

Ari. Sure, Yes.

what think of is it driving see I a we So is combination factors.

the say organization, be I can you're having in up right. not picked that's that the think, in say have may impact. it the project year our in because saying And think picking CEO that one, to want investments We're that sure seeing I leader hesitating of an like e-fulfillment. made might comes don't are I'd we of that would I kind past think every that I sales when in to we a earlier clearly kind in to feel the we I'm absolutely the up. we every as projects our position that have that. market see we

But don't every the single sure one. we see reality of I'm it is,

And some just extent, forget, wider other that net sales It even space, a think not and us. to omnichannel sort spreads certain it's food and clothing, a tech a is e-fulfillment. retail we thing more having a into good broader always don't about of So commodities. like about for

us. are is that starting more is confident the people the think working now thing different feel So helping But I sales the our to economies I that seeing regions right organization in think widening fundamental we're in. we're about

what it election, matter certainty. think future. the I a business look don't And is the today U.K. you Continental Europe recently crave to And mentioned in great the winning of certainty. It's think much They is But about and which here day. in the our a at party so is it's U.S. brings most we an customers for what crave happening what's in situation know can I

to at rates, levels, definitely, certainty people of Europe, interest a multiple year think, inflation investments. high involve trending right the that when are decisions I we in be direction allowing Continental investments So look more strategic going all customers seeing and invariably we're that make degree U.K., having to

that's And contracts. happy to longer-term sign are why people typically,

on also Clearly, markets. to benefit future. decisions, the it's I connected the here U.S., of rest forth. to that and And shape in people waiting a will here it's think just whether think on think that so the seen people of so the Mexico that's whether it as the will that our that I make whether in decisions it's up states consequence But how and they the in just U.S. in in about certainty invest U.S., states touch us about have point here are come whether connected in greater we've and we'll the might I tariffs and starting to as see to again, of individual business the U.S. when -- I think, to the you mentioned individual how might

and That's encouraging. very helpful very

Just a I for follow-up. one, quick if a could,

if kind we've up? there it's or if XX%. closer having whether if And rate sales of competitive So that to the step year-to-date. pipeline. [indiscernible] factors kind you're north rate billion think I And And billion, about I talked dynamics of be, win like what of about on capabilities. of new so, a It GXO you mentioned been kind about against $XXX I'm of whether $X $X.X looks might about million a that a business XX%. think curious historically, win of has it's seeing

we recognize seen that in on pipeline, Barish the let the on examine say at to what really But obviously, we're it. the when would Yes. is our come level or sales have [indiscernible], I where of I'll as verticals X a with. services probable in high that win think of There we we're the X if are the quite one it's we'll we're project that really people compete because more. But I leader, really, organizations a about foremost e-fulfillment, field. we

see we clearly a -- I where as being you when where being leader, pipeline, as we to a seen have success we've look that seen of a at So comment think where to have reference you the that sites still customers we to we've in greater And different about my new verticals as opposed new tons I back Europe. as see can show entrant. Aerospace go we can

us that Without but be coming our One in long-standing actually will that, very aerospace. of about the rate in win a the not is we could easily reputation aerospace the considerably across that pleased things we're along help Europe. much with That will business, U.K. building lower. Wincanton dailies in much, an just imagine

our So you're rates seeing, that core the I recognize win strength think, areas.

I think better. we're doing

where I brand-new you a rates we're Barish, think because give can lower, will be much bit we're simply unequivaly recognized taking much, little verticals maybe market share. they just win a entrant. new around our that. more equally But detail equally,

the have better sales improve that pipeline. processes get from investing say we our And also sales the Ari, in improve been existing in pipeline recall, wins from our you our to investing pipeline when to our about includes this teams results talk teams. in sales investing and we as

the of we seeing and you're our investment, in process the the organization. So results focus that improvements entire commercial have established

the with Our line final from UBS. Tom Wadewitz question of today comes

Yes.

let's see. So

impact Tim their strategy the logistics the of providers market. the lot. more I wanted could U.S. you maybe growing First, evolving or I on They've market. in logistics a that there'll just them in any get think with to be ask see obviously and been activity And with and if thoughts Sean

kind that your know impact don't any I if that U.S. of activity if if kind market. in and has you're So to or indifferent that's of

And the is be that would one wallet share. question. the So first just second on

can well traction I more the you the had warehouses customer. with nice with with idea and grow the of do you've existing or a couple in think past, that where customer you the then

are Or maybe new is of factor that still has significant shifted the to the a bigger more pipeline? some driver? So in wins a customer that it

Tom, Yes, it's Malcolm. Yes.

points. those you X background Let on me give some

we've seeing our it no would of I've mean, impact our as have the companies their I customers any don't successful we're relatively think doubt So say to our wrong reacted, first that strategies, highly across entrants slightly particular not real consequence those both got -- any been But point but that business. across modified of and really [indiscernible] some those will have new in a to I to terms impact of we'll own of business, market. maybe seen the have be

of actually what I that's say what that. only that terms in share I situation. you on so we're can can with And seeing

I terms think on. to the can I in second Barish point maybe come ask of

of multiyear wins, years, global we've customers us multiple we in look the And look on that been period. you our our growing more share XX% giving Malcolm, Sure. existing a share at have then wallet into least service of with you when of from provide, half good more our predictable been we our and large customers reach. over gaining the overall services, wallet them money good value and for

is improve them existing of signing new grow their to a share our we to help sign and help of brands, not our with productivity are share. success grow customers go So more that them but to business getting wallet and and with them, new from That's say we we business our helped is our reach. not are through the them we and core at new vote consumer the logos, that

the operation business that back signed Europe earlier I live Zalando. Central with think, add in, noting we Czech about to Tom, think, comment, with Republic. with actually just XXXX And our worth our agreement in mentioned first Zalando we to in, I first went It's Barish's

gone big much France. done It's very what our business, a just that operation Entrust flagship and to Barish our commenting great us. in on. confident in to they're really now further action live our activity customer We've for So just is it's job has --

the doubt big I've great go it will we've to organizations. how doing It's customers we hope job grown we'll that no blue on one of tend many the typically work to see . so we're that we that's big with, new we chip sincerely as got the of And that work international with forward. for We that of the spur operation And with these Levi's. kind And customer flagship been the our large trend, business. projects. reasons

Ladies floor turn time for today. back and closing for gentlemen, have questions that's to we I'll all the Mr. Wilson the remarks.

appreciate also to We our hosting today. Rob, everybody and call for thank that. who's you Thanks participated. Thanks, really

we I questions. appreciated really pleased third with been quarter. and I some the that. insightful some through that's myself, we got our And progress great Kristine, come overall think very question, . Barish We've very think,

future. I as business, a into think As delivered to wins, and more looking we new we're strong business business business wins, we're going forward even growth the

to that's in is projects to dealing expected organic pipeline good always our was that work part a year, growth. to It number of greater our whenever projects, weeks. projects, shape. impact, sales to results return of the is drift different one up business. always playing double-digit from to in I for just a this we're that Barish tangible with that impact return But good think few see see company see. mentioned now. real we're very starting big a been good it's I possibility new shape close conclude and the with one a that Kristine of a before e-fulfillment which of in very think was also day just pleasing big that And single of year of And are and And of there's the every it's for set of mentioning high of technologies doing our a lot business, I have great have end teams the digit, will also engines us XXXX. of well think innovative running for plus slight us very AI, Our the business is in us coming strong exciting to all to

we we're So the the I really very about into And move X. next year. think quarter next excited as feeling quarter,

So and like to the and joining for a thank us the rest day, I'd you. on with everybody call, wish that, thanks of great again

participation. Ladies this for today's you Thank your and concludes gentlemen, teleconference.

disconnect this a time. now lines Have wonderful may your day. at You