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Logistics Bulletin


Monday 18 February  2019

This week’s Logistics Bulletin reports on the loss, by XPO Logistics, of around two-thirds of business from its largest customer, suspected to be Amazon, valued at some US$600.0 million. After significant investment in its logistics operations, the move could be interpreted as Amazon taking business in-house, which could also have future repercussions for the likes of FedEx and UPS. The news came as XPO missed its Q4 forecast for adjusted EBITDA, primarily due to headwinds in France and the UK and a loss of profit in the postal injection business with its largest customer. Press reports suggested that the Company’s shares dropped more than 12.0% after reporting the weaker-than-expected earnings, as the Company also revised expectations for 2019 downwards. The Company’s share price has reportedly declined around 40.0% over the past six months.

In 2018, XPO’s top five customers represented about 11.0% of revenue and the largest customer represented approximately 4.0% - 5.0% of that. Going forward, with that customer having downsized, XPO anticipate that its top five customers in 2019 will represent about 8.0% of revenue. XPO had substantial capacity dedicated to this customer in brokerage, last mile and logistics, but expect that the great bulk of these resources should be redeployed over the next couple of quarters. On the plus side for XPO, 2018 saw it complete a record 118 contract start-ups, up from 91 in 2017.

Elsewhere this week, as Panalpina started discussions with Agility on potential strategic opportunities with regard to their respective logistics businesses, it was confirmed that DSV has made a revised, all-cash, offer to acquire Panalpina. The new offer was made in response to feedback and included, for example, certain commitments to Panalpina’s employees and the Company’s heritage.


Corporate and market news...

  • XPO Logistics lowers profit expectations on loss of business from largest customer
  • Revenue from transportation and logistics increases by 9.0% at Bollore
  • DP World handles 71 million TEU and reports 2.9% volume growth
  • Continuing container growth pushes throughput at port of Rotterdam to new high
  • Odyssey Logistics & Technology posts double digit revenue and earnings growth for 2018
  • DSV makes new bid for Panalpina
  • Panalpina opens strategic discussions with Agility
  • CMA CGM launches its public tender offer for CEVA shares
  • Redwood Logistics makes second acquisition of 2019
  • Maersk targets Logistics & Services for 2019 growth
  • Swissport to acquire Heathrow Cargo Handling from Air France
  • EU Commission approves joint control over Virgin Atlantic by Air-France-KLM, Delta and Virgin
  • FedEx Logistics to move global headquarters to Downtown Memphis

Service developments... 

  • Ryder disrupts eCommerce industry by enabling manufacturers to go direct to online consumers
  • DB Cargo and DB Schenker outstrip trains run by regional state railways
  • H.Essers and Lineas launch direct Genk-Trieste rail connection
  • 6 River Systems launches solutions in Europe

Outsourcing news...

  • Wincanton selected by HMRC for logistics contract
  • Toyo Tires renews logistics contract with Fiege
  • Smiths News agrees new long term logistics contract with Reach
  • Debenhams to develop a strategic sourcing partnership with Li & Fung
  • Kerry Logistics to establish Hong Kong’s first one-stop meat processing plant
  • DB Schenker named official logistics provider for SportAccord
  • DHL appointed global logistics partner of the Jaguar I-PACE eTROPHY Championship

Warehouse and distribution centre developments...

  • Rakuten Super Logistics expands into six additional US markets
  • P3 set to begin its largest speculative development project
  • Croda set for new UK logistics centre
  • DSV signs up for multi-storey logistics facility in Spain
  • UNFI set to reduce its dependency on third-party logistics services
  • Porsche Cars to open first parts distribution centre in Canada
  • Mercedes invests in logistics operations in Thailand
  • Home Depot signs 20-year lease for logistics centre
  • Cemex to establish distribution centre in northern Spain
  • Schaeffler opens automotive aftermarket logistics facility in Mexico
  • XPO Logistics and Verizon to close Memphis facility
  • Yusen Logistics Benelux expands in The Netherlands

IT, fleet and environmental developments...

  • Silent overnight deliveries test uses hybrid truck
  • Hellmann and Symbic develop innovative light-guide-system for order picking
  • DHL Freight Quotation Tool for road freight now live in 28 countries

Personnel and HR developments...

  • Five new leaders to drive growth at GEFCO’s Freight Forwarding division
  • CEVA Logistics appoints Head of LCL Product
  • FedEx appoints President and Chief Operating Officer
  • Flex appoints CEO
  • C.H. Robinson appoints new Chief Executive Officer

The Logistics Bulletin has provided global supply chain professionals with the latest insight, news and analysis for 16 years. To receive this highly valued service direct to your in-box, register here. Press releases and articles for inclusion can be sent by email to logisticsbulletin@analytiqa.com