The conglomerate, which spun off its Europe-centered warehousing business, GXO, last August, is nearly finished splitting up its different business units. XPO Chairman Brad Jacobs and other executives have said the strategy is intended to enhance shareholder value by eliminating what Jacobs has referred to as the “conglomerate discount.”
Once XPO divests the rest of its European business, it will become one of largest pure-play LTLs in North America. The Charlotte, North Carolina-based brokerage, RXO, will also be among the largest in its segment on the continent.
“With the spin-off complete, XPO and RXO have both launched from positions of strength as independent public companies,” Jacobs said in a statement Tuesday. “I want to thank the many people who have worked to make our strategic plan a success and created powerful new avenues for value creation.”
In its final quarter under one roof, XPO on Monday reported a 3% increase in revenue excluding last year’s sale of its intermodal operation.
LTL tonnage improved each month in Q3, turning positive in September. The company expects a YoY increase in tonnage next quarter, Jacobs said on an earnings call Monday.
The company reaffirmed its 2022 full-year LTL revenue target of $1 billion of full-year adjusted EBITDA.
The brokerage, now known as RXO, grew volume by 9% YoY and reported a gross profit margin of 19%, Jacobs said.
XPO officials plan to celebrate the spinoff Tuesday with an event at the New York Stock Exchange.
“We have been working towards separating our asset-based and asset-light businesses since we announced our strategic plan in March,” Jacobs told investors on the earnings call. “This is a watershed moment for XPO’s shareholders.”