GXO Logistics : Factoring and Securitization

Published: 2025-05-09 14:03:06 ET GXO

Published on 05/09/2025 at 14:03

GXO Factoring & Supply Chain Financing

Principle: When the company sells receivables, it accelerates cash receipts, thereby increasing reported free cash flow Examples:

On 6/1, company generates an accounts receivable invoice of $100. If the receivable is outstanding at end of quarter (customer

has not paid) and the company sells the receivable for cash consideration on 6/30, operating cash flows (and free cash flow) during the quarter have benefitted from the receivable sale

By way of contrast, if the company sells the receivable on 6/1 and the customer remits payment on or before 6/30, the sal

of the receivable has not benefitted free cash flow during the quarter because, absent the sale, operating cash flows would have reflected the cash receipt.

(Note, GXO has visibility to customer remittances post‐sale as it functions as a servicer on behalf of receivable purchasers

Q1 2024

Q2 2024

Q3 2024

Q4 2024

Q1 2025

$m

Benefit (Reduction) to free cash flow from trade receivables programs

3

15

140

41

(12)

Factoring & Supply Chain Financing Program

AMAPAC

88

21

65

115

123

UK&I

141

162

193

165

184

EUROPE

61

105

103

106

99

Wincanton

77

175

279

196

A

Receivables sold in period

291

364

536

665

602

B

Cash consideration

288

361

533

660

598

C

Less: sold receivables due or collected within period

(10)

(32)

(63)

(149)

(99)

D

Cash consideration from prior sequential quarter

(276)

(314)

(330)

(470)

(511)

E

Total cash impact of factoring programs (B + C + D)

3

15

140

41

(12)

Benefit (reduction) to free cash flow from trade receivables programs (E

3

15

140

41

(12)

Year‐to‐date benefit (reduction) to free cash flow from trade receivables programs

3

18

159

200

(12)

With respect to trade receivables sold during the period indicated, represents cash received on sold receivable

Any difference between cash purchase price and gross amount of receivables sold represents the discount on sale of receivables and is recorded within interest expense

Receivables sold with a due date intra quarter are excluded from cash impac

The examples above are for illustrative purposes only. Neither the Company's independent auditors, nor any other independent accountants, have compiled, examined or performed any procedures with respect to the examples, nor have they expressed any opinion or any other form of assurance on such examples.

Disclaimer

GXO Logistics Inc. published this content on May 09, 2025, and is solely responsible for the information contained herein. Distributed via Public Technologies (PUBT), unedited and unaltered, on May 09, 2025 at 18:02 UTC.