Third Quarter 2020 Financial Results Echo Global Logistics, Inc. - PowerPoint PPT Presentation

Third Quarter 2020 Financial Results Echo Global Logistics, Inc. October 28, 2020

Forward-Looking Statements All statements made in this presentation, other than statements of historical fact, are or may be deemed to be forward-looking statements. These statements are forward-looking statements under the federal securities laws. We can give no assurance that any future results discussed in these statements will be achieved. These statements are based on current plans and expectations of Echo Global Logistics and involve risks, uncertainties and other factors that may cause our actual results, performance or achievements to be different from any future results, performance or achievements expressed or implied by these statements. Information concerning these risks, uncertainties and other factors is contained under the headings "Risk Factors" and "Forward-Looking Statements" and elsewhere in our Annual Report on Form 10-K for the year ended December 31, 2019, our Quarterly Reports on Form 10-Q for the quarters ended March 31, 2020 and June 30, 2020, and other filings with the Securities and Exchange Commission. 2 2

Third Quarter 2020 Financial Review Three Months Ended September 30, dollars in millions, except per share data 2020 2019 % Change (unaudited) Revenue $ 691.5 $ 561.4 23.2 % Net revenue (1) $ 100.4 $ 97.0 3.6 % Net income $ 6.8 $ 4.8 40.8 % EBITDA (1) $ 19.9 $ 19.3 3.4 % Adjusted EBITDA (1) $ 21.9 $ 21.8 0.4 % Fully diluted EPS $ 0.26 $ 0.18 40.9 % Non-GAAP fully diluted EPS (1) $ 0.40 $ 0.39 1.5 % (1) For a description and reconciliation of these non-GAAP financial measures to the nearest comparable GAAP financial measures, please refer to the Appendix included in this presentation. Key Takeaways • The increase in third quarter 2020 revenue was primarily the result of an increase in revenue per shipment in truckload ("TL") as well as increase in volume in both TL and less than truckload ("LTL"). • The increase in third quarter 2020 Adjusted EBITDA was the result of the increase in revenue, offset by lower TL and LTL margins. 3 3

Revenue by Mode Three Months Ended September 30, dollars in millions 2020 2019 % Change (unaudited) Truckload ("TL") revenue $ 488.2 $ 368.9 32.3 % Less than truckload ("LTL") revenue 175.5 167.6 4.7 % Other revenue 27.9 25.0 11.6 % Revenue 23.2 % $ 691.5 $ 561.4 Note: Amounts may not foot due to rounding. Key Takeaways • TL (includes Partial TL) revenue increase was driven by a 16.5% increase in revenue per shipment and a 13.6% increase in volume. • LTL revenue increase was driven by a 6.6% increase in volume, offset by a 1.8% decrease in revenue per shipment. 4 4

Revenue by Client Type Three Months Ended September 30, dollars in millions 2020 2019 % Change (unaudited) Transactional revenue $ 533.9 $ 433.3 23.2 % Managed Transportation revenue 157.6 128.1 23.0 % Revenue 23.2 % $ 691.5 $ 561.4 Key Takeaways • The increase in Transactional revenue was driven primarily by 15.9% increase in TL (includes Partial TL) revenue per shipment and 11.1% increase in TL volume. • The increase in Managed Transportation revenue was driven primarily by 18.6% increase in TL (includes Partial TL) revenue per shipment and increase in both TL and LTL volume of 33.6% and 9.4%, respectively. 5 5

Net Revenue and Revenue Analysis Three Months Ended September 30, dollars in millions 2020 2019 Change (unaudited) Net revenue (1) 3.6 % $ 100.4 $ 97.0 Net revenue margin (1) 17.3 % (275) 14.5 % bps TL revenue mix 70.6 % 65.7 % 490 bps LTL revenue mix 25.4 % 29.9 % (448) bps Other revenue mix 4.0 % 4.4 % (42) bps Transactional revenue mix 77.2 % 77.2 % 2 bps Managed Transportation revenue mix 22.8 % 22.8 % (2) bps (1) Non-GAAP financial measure calculated as revenue less transportation costs. For a description and reconciliation of this non-GAAP financial measure to the nearest comparable GAAP financial measure, please refer to the Appendix included in this presentation. Key Takeaways • The year-over-year decrease in net revenue margin resulted from lower TL and LTL margins, as well as a shift in mode mix towards TL. • The increase in our TL revenue mix was driven by an increase in TL volume and TL revenue per shipment. • The decrease in our LTL revenue mix was driven by a modest decrease in LTL revenue per shipment. 6 6

Expense Summary Three Months Ended September 30, dollars in millions 2020 2019 Change (unaudited) Revenue $ 691.5 $ 561.4 23.2 % Net revenue (1) $ 100.4 $ 97.0 3.6 % Commission expense $ 29.8 $ 29.1 2.5 % Percent of net revenue 29.7 % 30.0 % (31) bps Change in contingent consideration $ (0.3) $ 0.1 (622.2) % Percent of net revenue (0.3) % 0.1 % (33) bps Stock compensation expense $ 2.3 $ 2.5 (9.2) % Percent of net revenue 2.3 % 2.6 % (32) bps Other selling, general and administrative $ 48.7 $ 46.1 5.8 % Percent of net revenue 48.5 % 47.5 % 100 bps Selling, general and administrative expenses $ 80.5 $ 77.7 3.6 % Percent of net revenue 80.2 % 80.1 % 3 bps Depreciation $ 7.0 $ 6.8 2.5 % Percent of net revenue 6.9 % 7.0 % (7) bps Amortization $ 2.7 $ 2.8 (3.8) % Percent of net revenue 2.7 % 2.9 % (21) bps Cash interest expense $ 1.0 $ 1.3 (19.6) % Percent of net revenue 1.0 % 1.3 % (29) bps Non-cash interest expense $ — $ 1.6 (100.0) % Percent of net revenue — % 1.6 % (161) bps Non-GAAP tax rate 24.8 % 25.0 % Note: Amounts may not foot due to rounding. (1) For a description and reconciliation of this non-GAAP financial measure to the nearest comparable GAAP financial measure, please refer to the Appendix included in this presentation. Key Takeaways • Commission expense increased due to higher net revenue. Other selling, general and administrative expense increased due to increase in non-sales headcount and incentive compensation. • Non-cash interest expense decreased due to the settling of convertible notes on May 1, 2020. 7 7

Cash Flow and Balance Sheet Data Selected Cash Flow Data Three Months Ended September 30, dollars in millions 2020 2019 % Change (unaudited) $ 17.6 $ 17.1 Cash generated from operations 3.0 % (5.0) Capital expenditures (5.7) (12.8) % Free cash flow (1) $ 12.6 $ 11.4 10.9 % Note: Amounts may not foot due to rounding. (1) For a description of this non-GAAP financial measure to the nearest comparable GAAP financial measure, please refer to the Appendix to this presentation. Selected Balance Sheet Data September 30, December 31, 2020 2019 dollars in millions (unaudited) Cash and cash equivalents $ 47.6 $ 34.6 Accounts receivable, net of allowance for doubtful accounts 432.5 287.0 Current assets 491.7 336.2 Current liabilities 381.6 230.4 Long-term debt, net 143.9 — Convertible notes, net — 156.3 Stockholders' equity $ 386.5 $ 383.3 Key Takeaways • The increase in free cash flow is a result of higher net income and lower capital expenditures. • The increase in accounts receivable is a result of higher revenue in Q3 2020. 8 8

Liquidity Summary Key Takeaways Available Liquidity - September 30, 2020 • Liquidity Metrics at September 30, 2020 400 Cash Balance: $47.6M 363.7 363.7 363.7 363.7 316.1 (145.0) Outstanding ABL Balance: $145M 300 Excess ABL Availability: $171.1M Total Available Liquidity: $218.7M 218.7 218.7 Summary of ABL Credit Facility (1) • 200 ◦ Maximum loan amount: $350M ◦ Collateral: 85% advance rate on eligible AR 100 47.6 47.6 ◦ AR availability at September 30, 2020: $316.1M ◦ Interest Rate: LIBOR + 150 bps or LIBOR + 0 Cash Balance ABL ABL Debt Total Liquidity 125bps if borrowing less than 50% of availability Availability Balance ◦ Maturity date: October 23, 2023 ◦ Fixed Charge Coverage Ratio of at least 1.0 Net balance of $171.1M represents the total excess ABL availability. (1) For a copy of the full credit agreement, please reference: https:// echogloballogisticsinc.gcs-web.com/financial-information/sec-filings 9 9

Guidance Q4 2020 FY 2020 • Revenue: $675M - $725M • Revenue: $2.43B - $2.48B • Commission: 29.75% - 30.25% • Commission: 29.75% - 30.25% • G&A Costs: $49.5M - $52.5M • G&A Costs: $193M - $196M • Depreciation: $6.8M • Depreciation: $27.8M • Cash Interest: $1.0M • Cash Interest: $4.5M • Share Count: 26.5M • Share Count: 26.5M • Non-GAAP Tax Rate: 25.0% • Non-GAAP Tax Rate: 25.0% Excluded for Non-GAAP: Excluded for Non-GAAP: • Amortization: $2.7M • Amortization: $11.0M • Stock Compensation: $2.3M • Non-cash Interest: $1.7M • Stock Compensation: $11.5M Fourth Quarter 2020 Trends (1) • October per business day revenue up 37% • October per business day TL shipments up 18% • October per business day LTL shipments up 14% • October net revenue margin approximately 15% (1) October trends are representative of the first 17 business days in the month. 10 10