XPO Logistics’ revenues fall, posts loss amid coronavirus hit
GREENWICH — Transportation-and-logistics giant XPO Logistics this week reported lower revenues and a loss for the past quarter as it dealt with continued disruption from the coronavirus crisis, although executives said they saw signs of a comeback.
The second-quarter revenues for the Greenwich-based firm dropped 17 percent year over year to about $3.5 billion. The declining returns contributed in large part to a $132 million loss, compared with a $122 million profit in the same period a year ago.
CEO and Chairman Bradley Jacobs said he was still sanguine about the company’s prospects, pointing to its surpassing of expectations on revenue, adjusted earnings and adjusted earnings per share, as well as quarterly revenue growth of 3 percent in its last-mile delivery network in North America.
“Business trends improved across our segments and geographies as the quarter progressed and continued in July,” Jacobs said in a statement. “We’ve seen a recovery take hold in Europe and start in North America. E-commerce continues to be our strongest tailwind, benefiting contract logistics and last mile.”
After the release of the results, XPO shares tumbled 13 percent Friday to about $75. They hit about $100 at their 52-week high.
Also this week, XPO announced several executive hires.
Its new chief transformation officer, Eduardo Pelleissone, joins with 20 years of experience in leading multinational operations in the food, logistics and transportation industries including Kraft Heinz Co., and its predecessor H.J. Heinz.
New executive vice president of operations Alex Santoro has two decades of executive experience with major firms, including Restaurant Brands International, the parent company of Burger King, Tim Hortons and Popeyes.
The company also named its first chief diversity officer, LaQuenta Jacobs. She joined XPO in 2018 as head of human resources for the company’s last-mile unit. She and Bradley Jacobs are not related.
“I’m delighted that our first chief diversity officer is such a qualified candidate from within our own organization,” Bradley Jacobs said. “LaQuenta is a unique talent — she cares deeply about the human aspects of diversity, and also knows how to advance cultural development within a public company of XPO’s size, with almost 100,000 employees. I look forward to working with LaQuenta in her new role.”
Focus on workers
With its services classified as essential by the federal government, XPO has maintained its operations across the country during the pandemic. The No. 196 firm on this year’s Fortune list employs about 50,000 in the U.S., accounting for about half of its global workforce.
XPO officials said that they have responded to the coronavirus pandemic with a number of measures, including obtaining personal protective equipment and instituting social-distancing practices and “pro-active” cleaning schedules at its facilities.
To encourage employees to stay home when they are ill, the company said it has provided two extra weeks of paid sick leave for employees in the U.S. and Canada.
In addition, it has announced “frontline appreciation pay” for nearly 40,000 employees in the U.S. Hourly warehouse workers are receiving an extra $2 per hour on top of their regular rates.
The company said it has also added free COVID-19 testing to its U.S. health insurance coverage and provided free access to telehealth services.
But not all of its staff are satisfied. In May, several U.S. and European employees said in an online forum that they had been working in unsafe conditions.
The International Brotherhood of Teamsters union, a longtime company critic that has been trying to organize workers across the U.S. for several years, organized the webinar two days ahead of XPO’s annual shareholder meeting.
In a responding statement, XPO said that “as the Teamsters continue to spread misinformation and take advantage of a public health crisis to further their own financial agenda, we’ve consistently put employee safety first throughout the pandemic with aggressive measures to protect their physical and mental health. ... The results indicate our efforts are working, with our rate of infection well below the global and national average.”
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