Domination and profit and loss transfer agreements
Profit transfer and loss compensation between companies in Germany do not constitute service relationships. On the contrary, profit and loss transfer agreements stipulate that the amount of profit distributed or the sum required to offset losses is not reset every year but is calculated automatically. The cash flow is based on the shareholder’s right to profits or obligation to compensate any losses. Notwithstanding this, DB Group ensures that Group companies have an adequate equity base despite the obligation assumed to offset possible losses of individual Group companies.
Investors are only willing to provide capital if amortization and interest yields are ensured. A purely debt-based financing model is not commercially viable, as it is associated with too high risks. Profits are essential to maintain DB Group’s ability to invest. Profits generated are either retained or distributed to the Federal Government as the sole shareholder. The (retained) portion of the profit remaining in DB Group increases its capital expenditure and borrowing capacity.
The implementation of the annual profit transfers and loss compensation in DB Group is reflected in the net investment income of DB AG.
As part of the LuFV, the Federal Government and DB Group have contractually agreed that, in the event of a dividend payment by DB AG to the Federal Government, the dividend will be used by the Federal Government to carry out replacement capital expenditures in rail infrastructure. As a result, the after-tax profits of the rail infrastructure companies (RICs) are distributed in full to the Federal Government and also fully reinvested in the infrastructure. This mechanism ensures that profits from infrastructure are channeled entirely into the infrastructure as investment grants and remain there. In contrast to alternative profit retention, there is no increase in the capital employed. In LuFV III, assumptions were made regarding the amount of the annual dividend which were incorporated into the overall scope of the LuFV funds.
The domination and profit and loss transfer agreement between DB AG and DB Cargo AG was terminated with effect from December 31, 2024. A Group Coordination Agreement was concluded for further cooperation. Contracts and performance agreements are still possible and customary in the existing division of labor; the existing collective bargaining agreements and Group works agreements continue to apply. As the parent company, DB AG exercises management power. DB Cargo AG remains a fixed and integrated part of DB Group.
| Cash flows DB AG and DB infrastructure companies / € million | 2000 to 2011 | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | Total |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| From capital increases by DB AG | |||||||||||||||
| DB InfraGO AG | +1,220 | – | +5 | – | – | – | +1,000 | – | – | – | +1,125 | +1,300 | +1,125 | +5,503 | +11,278 |
| DB Station&Service AG 1) | +439 | – | – | – | – | – | – | – | – | – | +1,000 | +49 | +2 | – | +1,490 |
| Total | +1,659 | – | +5 | – | – | – | +1,000 | – | – | – | +2,125 | +1,349 | +1,127 | +5,503 | +12,768 |
| From profit and loss transfer agreements to (–) / from (+) DB AG | |||||||||||||||
| DB InfraGO AG | +983 | –197 | –66 | –217 | –81 | –280 | –390 | –509 | –402 | +23 | +139 | –403 | +1,634 | +209 | +443 |
| DB Station&Service AG 1) | –618 | –160 | –169 | –188 | –203 | –176 | –186 | –190 | –146 | +32 | +61 | +2 | –7 | – | –1,948 |
| DB Energie GmbH | –525 | –62 | +37 | –39 | –51 | –35 | –59 | –12 | +3 | +66 | –126 | –140 | –166 | –46 | –1,155 |
| Total | –160 | –419 | –198 | –444 | –335 | –491 | –635 | –711 | –545 | +121 | +74 | –541 | +1,461 | +163 | –2,660 |
| Dividend payment to the Federal Government (for previous year) | |||||||||||||||
| DB AG | –500 | –525 | –525 | –200 | –700 | –850 | –600 | –450 | –650 | –650 | – | – | –650 | – | –6,300 |
(+) Cash inflow
(–) Cash outflow
1) DB Station&Service AG was merged with DB InfraGO AG with effect from May 1, 2023.