8-K - RXO - Equibles

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of theSecurities Exchange Act of 1934

Date of Report (Date of earliest event reported): November 30, 2022

RXO, INC.

(Exact name of registrant as specified in its charter)

Delaware	001-41514	88-2183384
(State or other jurisdiction of<br><br>incorporation)	(Commission File Number)	(IRS Employer<br><br>Identification No.)
11215 North Community House Road	28277
---	---
Charlotte, NC
(Address of principal executive offices)	(Zip Code)

(980) 308-6058

(Registrant’s telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading<br>symbol(s)	Name of each exchange on which<br><br>registered
Common stock, par value $0.01 per share	RXO	New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 7.01. Regulation FD Disclosure.

RXO, Inc. (the “company”) is furnishing hereto as Exhibit 99.1 supplemental financial information with respect to its historical results.

The information furnished pursuant to this Item 7.01, including Exhibit 99.1, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities under that Section and shall not be deemed to be incorporated by reference into any filing of the company under the Securities Act of 1933 (the “Securities Act”) or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits.

Exhibit No.	Description
99.1	Supplemental Financial Information

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this Current Report on Form 8-K to be signed on its behalf by the undersigned hereunto duly authorized.

Date: November 30, 2022	RXO, INC.
	By:	/s/ Jeff Firestone
		Jeff Firestone
		Chief Legal Officer

Document

EXHIBIT 99.1

RXO, Inc.
Reconciliation of Net Income to Adjusted EBITDA and Public Company Pro Forma Adjusted EBITDA
(Unaudited)
(in millions)
	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Net income	$	13	$	33	$	96	$	108
Interest income	(1)		—		(1)		—
Income tax provision	2		5		29		28
Depreciation and amortization expense	23		22		65		62
Transaction and integration costs	23		1		44		2
Restructuring costs	6		1		9		1
Other	—		—		—		(1)
Adjusted EBITDA (1)	$	66	$	62	$	242	$	200
Reversal of allocated corporate expense (2) and other	1		5		16		17
Public company standalone cost (3) (4)	(1)		(11)		(24)		(34)
Public company pro forma adjusted EBITDA (1)	$	66	$	56	$	234	$	183
(1) See the "Non-GAAP Financial Measures" section for additional information.
(2) Allocated corporate expense per RXO condensed combined financial statements; excludes the impact of adjusted items and allocated income tax, depreciation and amortization from XPO Logistics, Inc. Corporate.
(3) Estimated incremental costs of operating RXO as a standalone public company.
(4) Q3 2022 net income includes a majority of the estimated incremental costs of operating RXO as a standalone public company.

Non-GAAP Financial Measures

This document contains the following non-GAAP financial measures for RXO: adjusted earnings before interest, taxes, depreciation and amortization, as further adjusted in connection with the contemplated spin-off transaction (“adjusted EBITDA”); and public company pro forma adjusted EBITDA.

We believe that the above adjusted financial measures facilitate analysis of the ongoing business operations of RXO because they exclude items that may not be reflective of, or are unrelated to, RXO’s business’ core operating performance, and may assist investors with comparisons to prior periods and assessing trends in our underlying businesses. Other companies may calculate these non-GAAP financial measures differently, and therefore our measures may not be comparable to similarly titled measures of other companies. These non-GAAP financial measures should only be used as supplemental measures of our operating performance.

Adjusted EBITDA includes adjustments for transaction and integration costs as well as restructuring costs. Transaction and integration adjustments are generally incremental costs that result from an actual or planned acquisition, divestiture or spin-off and may include transaction costs, consulting fees, retention awards, and internal salaries and wages (to the extent the individuals are assigned full-time to integration and transformation activities) and certain costs related to integrating and converging IT systems. Restructuring costs primarily relate to severance costs associated with business optimization initiatives. Management uses this non-GAAP financial measure in making financial, operating and planning decisions and evaluating RXO’s ongoing performance. Public company pro forma adjusted EBITDA includes adjustments for the reversal of allocated corporate expenses, public company operating expense and expense of being a public company.

We believe that adjusted EBITDA and public company pro forma adjusted EBITDA improve comparability from period to period by removing the impact of RXO’s capital structure (interest and financing expenses), asset base (depreciation and amortization), tax impacts and other adjustments as set out in the attached tables that management has determined are not reflective of core operating activities and thereby assist investors with assessing trends in RXO’s underlying businesses.