XPO Logistics Releases Chairman’s Letter to Stockholders

GREENWICH, Conn., April 16, 2020 (GLOBE NEWSWIRE) -- XPO Logistics, Inc. (NYSE: XPO), a leading global provider of supply chain solutions, has released the text of the 2020 letter to stockholders from Bradley Jacobs, chairman and chief executive officer.

The full letter appears below and will be distributed with the company’s proxy statement on April 20.

To Our Stockholders

Things are difficult right now and they’ll get worse in the short-term. Then they’ll get much, much better. That’s what I see for XPO, our industry and the world.

I’m a pragmatic bear in the short-term, because that’s the reality of COVID-19.

We expect that 2020 will be a lost year for earnings growth in our industry and most industries around the world. Our first priority is to keep our employees out of harm’s way. Second is our duty as an essential provider of transportation and logistics services. We’re helping communities get through this, so the economy can get back on its feet.

Here’s what we’ve been seeing at XPO. We had ears to the ground from day one in Asia, where we have about five million square feet of logistics space, including a footprint in Wuhan, China. Our Chinese logistics sites are all back up and running at about 90% of prior levels. Our European operations saw the impact next, starting with Italy and followed by Spain and France at roughly the same time; then the UK and other parts of Europe. North America was the most recent, and the most rapid, escalation.

From a demand standpoint, January was very good and February and early March were reasonably good. The last half of March declined sharply as large sectors of the economy came to a near halt. Our industry is a leading indicator, so we felt the pain early, and we’ll be at the forefront of the rebound when the world returns to work. We expect that to happen in fits and starts in the back half of the year, as extreme social distancing winds down.

Timing can be tricky under these circumstances, but our major markets appear to be in the worst of it now, in mid-April. One thing is clear: there’s a beginning, a middle and an end to this. Most other countries aren’t in a position to enact the methodical return-to-work process we saw in China, so a global rebound may take longer, but it’s a certainty. Never before have so many governments, industries, individuals, technologies and scientific resources been focused on solving a single problem. It will be resolved.