North America Outlook
Q: When will North American volumes improve?
A: North American volumes remain sluggish with uncertainty persisting, but we anticipate improvement in Q4, driven by strong new business wins and preparation for the holiday season. Inventory levels are returning from their low point at the end of last year, and customers are starting to prepare for this year's holiday season ,.

Free Cash Flow Guidance
Q: Explain the free cash flow expectations for the second half.
A: We had a strong first half with free cash flow up $56 million year-over-year, putting us on track to achieve our 30% to 40% EBITDA to free cash flow conversion. Our cash flow tends to be second-half weighted, and we are comfortable with our guidance for the year , ,.

New Business Wins and Pipeline
Q: How are new business wins affecting growth and margins?
A: We are experiencing a tremendous amount of new business activity, with more new business signed in North America recently than for a long time. Deal sizes are getting bigger, contract durations are lengthening, and this bodes well for growth in the second half and into 2025 , ,.

Wincanton Acquisition Impact
Q: How will the Wincanton acquisition affect margins and integration?
A: The Wincanton acquisition will be a temporary margin drag due to open-book contracts until we start integration after regulatory approval, expected during September or October. We anticipate capturing roughly $55 million of cost synergies once integration begins, turning the margin impact into a tailwind in 2025 ,.

Capital Allocation and Deleveraging
Q: What's the plan for capital allocation in the second half?
A: We are focusing on generating cash, investing in organic growth, and deleveraging. Our priority is to integrate Wincanton, capture cost synergies, and pay down debt ,.

AI and Humanoid Robotics Adoption
Q: How is GXO implementing AI and humanoid robotics?
A: We are accelerating the deployment of technology, including trials with the latest humanoid robotics, coupled with AI-driven initiatives across a wide range of applications. AI deployments are up tenfold year-over-year in 2024, optimizing picking, managing inventory flow, and predicting SKU replenishment, which improves efficiency for our customers , ,.

Customer Demand and Inventory Levels
Q: What is the outlook for customer demand and inventory levels?
A: Inventory levels are returning from the low point at the end of last year. Customers are starting to prepare for the holiday season, and we expect a more pronounced holiday season than last year. Early inputs of inventory are getting ready for the holiday season , ,.

Margin Impact from New Contracts
Q: How will new contracts affect margins?
A: Large automated facilities we are taking over from in-house operations have higher margins due to automation. While there are ramp-up costs, these contracts become quite profitable and efficient once automation is fully operational ,.

M&A Strategy and Integration Practices
Q: How does GXO integrate acquisitions like Wincanton?
A: We fully integrate acquisitions to leverage strengths across the business, drive cost synergies, and provide the best environment for customers and team members. Integration of Wincanton will commence in earnest from January onwards, with most synergy benefits realized during the next year ,.

End Market Performance
Q: What's happening in the Food and Beverage sector?
A: Food and Beverage saw a decline reflecting the current consumer environment. However, we expect better results in the back half of the year, with our frozen network performing robustly.