Outlook (DB AG)
Expected development of DB AG
Anticipated income situation
Our forecasts for the development of DB Group and the Group companies in the 2025 financial year are based on DB Group’s expectations of developments in the market, competition and environment, and the implementation success of the planned measures.
In the 2025 financial year, it is likely that DB AG’s profit development will largely be characterized by the development of the subsidiaries and thus the level of the net investment income. For 2025, a significantly better development of the net investment income is expected overall, which will largely result from the elimination of negative one-off effects (impairment losses in conjunction with the permanent impairment at DB Fahrzeuginstandhaltung GmbH) and the omission of expenses from the loss absorption of DB Cargo AG as a result of termination of the profit and loss transfer agreement. The results of individual subsidiaries are also expected to improve. The absence of positive effects from the profit transfer from Schenker AG has a partially offsetting effect. We, therefore, also expect a noticeable overall improvement in DB AG’s net profit/loss for the year.
In 2025, the business development of DB Group and the Group companies will continue to be characterized by burdens from the high energy, procurement and personnel costs. In addition, measures to improve quality, particularly in the rail infrastructure, have an impact on DB Group’s development. This is aimed at minimizing the operational impact of the general modernizations of the Emmerich — Oberhausen and Hamburg — Berlin lines. However, short-term restrictions on operational quality during the modernization phase are to be expected. Weak economic development in Germany and Europe is also expected to dampen development in 2025. Countermeasures including as part of the S3 restructuring program should have a partially compensatory effect.
A key aspect for the development of profits in 2025 is also the continuation of the Federal Government’s funding of expenses for maintenance measures in DB InfraGO AG’s rail infrastructure. If the funds are not allocated to the extent set out in the draft Federal budget for 2025, this is likely to have a significant impact on the development of DB InfraGO AG, which is not included in the current forecast.
Anticipated financial position
Efficient liquidity management is once again a top priority for DB Group in 2025. It focuses on continually forecasting the cash flow from operating activities because this is the main source of cash and cash equivalents. In 2025, DB Group plans to repay financial liabilities in an amount above the level of 2024. These include repayments of maturing financial liabilities (excluding current liabilities to banks) at about the same level as in the previous year, the planned repayment of a hybrid bond (ISIN: XS2010039035) plus outstanding accrued interest and the bank loans that will fall due as a result of the completion of the sale of DB Schenker, which were taken out in previous years for bridge financing. The financial resources required for repayments are to be covered by the expected cash inflow from the sale of DB Schenker. Bond issues are not expected to be required in 2025.
DB Group continues to have adequate financial leeway for potential capital market activities. The guaranteed credit facilities serve as a fallback in the event of disruption to capital market access. Our short- and mid-term liquidity supply is, therefore, also secure in 2025. DB Group’s gross capital expenditures in 2025 will also be largely covered by investment grants and equity measures from the Federal Government. In 2025, they are expected to be slightly above the already very high level of 2024. By contrast, net capital expenditures to be financed by DB Group are likely to rise only slightly because the increase in gross capital expenditures largely results from higher Government funding. They are expected to be fully covered by internal financing in 2025.
DB Group’s net financial debt is expected to fall significantly as of December 31, 2025, as a result of the expected proceeds from the sale of DB Schenker. However, the forecast is subject to increased uncertainty in view of the Federal budget for 2025, which has not yet been adopted and the Government payments that fall under provisional budget management.