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 AGµ
The domination and profit and loss transfer agreement between DB AG and DB Cargo AG was terminated as of 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 employer/works council agreement 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 of DB AG and DB infrastructure companies / € million | 2000 to 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 | Total |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| From capital increases by DB AG | |||||||||||||||
| DB InfraGO AG | +1,220 | +5 | – | – | – | +1,000 | – | – | – | +1,125 | +1,300 | +1,125 | +5,503 | +8,329 | +19,607 |
| 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 | +8,329 | +21,097 |
| From profit and loss transfer to (–)/from (+) DB AG | |||||||||||||||
| DB InfraGO AG | +786 | –66 | –217 | –81 | –280 | –390 | –509 | –402 | +23 | +139 | –403 | +1,634 | +209 | +392 | +835 |
| DB Station&Service AG 1) | –778 | –169 | –188 | –203 | –176 | –186 | –190 | –146 | +32 | +61 | +2 | –7 | – | – | –1,948 |
| DB Energie GmbH | –587 | +37 | –39 | –51 | –35 | –59 | –12 | +3 | +66 | –126 | –140 | –166 | –46 | –135 | –1,290 |
| Total | –579 | –198 | –444 | –335 | –491 | –635 | –711 | –545 | +121 | +74 | –541 | +1,461 | +163 | +257 | –2,403 |
| Dividend payment to the Federal Government (for previous year) | |||||||||||||||
| DB AG | –1,025 | –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.
Allocation of profits of rail infrastructure companies
For the allocation of profits generated by the rail infrastructure companies (RICs) of DB Group (DB InfraGO AG and DB Energie GmbH), Section 8d (2) ERegG (Financial Transparency) stipulates that the profits of the RICs must either remain within those companies or may be distributed to a parent company on condition that the parent company, in turn, transfers them to the Federal Government by way of a dividend. Cross-subsidization to TOCs or other competitive areas within DB Group is therefore prohibited by law.
Under the LuFV (Section 2a LuFV III), the Federal Government and DB Group have contractually agreed, in accordance with statutory provisions, that in the event of a dividend payment by DB AG to the Federal Government, the Federal Government shall use the dividend to carry out replacement capital expenditures in the rail tracks of DB Group’s RICs. The calculation of the dividend amount based on the annual financial statements prepared in accordance with the German Commercial Code (Handelsgesetzbuch; HGB) is carried out in accordance with the legal provisions of the HGB and the German Stock Corporation Act.
The net profit for the year of the RICs according to HGB is transferred to DB AG or offset by DB AG and subsequently distributed to the Federal Government on a net basis, and is then fully reinvested in the rail infrastructure via the LuFV III. Through this “mechanism,” the net profit for the year of the RICs under the HGB is channeled in full into the rail infrastructure as additional investment grants and remains there. This means that any profits (net profit for the year) generated by RICs cannot remain with DB AG. This financing cycle ensures that all of the RICs’ profits are made available for the rail infrastructure. This “mechanism” is reviewed and certified by an auditor. In 2025, DB Group’s RICs did not generate in total a net profit for the year according to HGB; as such, the “mechanism” did not apply.
The Federal Government is not restricted in how it uses any additional dividend payments from DB AG that do not originate from the profits of the RICs.
Until now, it has been possible to trace the financing cycle only to a limited extent based on DB Group’s Annual Report and the RICs’ individual financial statements prepared in accordance with the HGB, for the following reasons:
- DB Group’s Annual Report includes the DB InfraGO and DB Energy business units. The key figures for the DB InfraGO business unit include not only DB InfraGO AG but also its subsidiaries. In addition, intercompany transactions between fully consolidated companies within the business unit are eliminated (consolidation). The DB Energy business unit consists solely of DB Energie GmbH.
In the separate financial statements of DB InfraGO AG, subsidiaries are included only in net investment income (the net amount of income and expenses arising from domination and profit and loss transfer agreements with the subsidiaries of DB InfraGO AG).
- The individual financial statements of DB InfraGO AG and DB Energie GmbH are prepared in accordance with the HGB, while the DB consolidated financial statements are prepared in accordance with the IFRS. This results in valuation differences that are recognized in profit or loss:
- At DB InfraGO AG, these items in 2025 resulted in particular from the capitalizability of interest on borrowed capital and the valuation of fixed assets (which affects the amount of depreciation).
- At DB Energie GmbH, these items in 2025 resulted primarily from the revaluation of electricity supply contracts and from the effects of additions to provision in connection with the decommissioning of facilities.
- The total IFRS profit after tax of DB InfraGO AG and DB Energie GmbH was significantly higher in 2025 than the profit after tax according to HGB.
The following table provides a reconciliation of the IFRS results for the DB InfraGO and DB Energy business units to the HGB results for DB InfraGO AG and DB Energie GmbH:
| Reconciliation of IFRS figures to the HGB financial statements of the RICs for 2025 / € million | IFRS | HGB | Valuation difference | IFRS | HGB | Valuation difference | IFRS | HGB | ||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| absolute | % | absolute | % | |||||||||
| DB InfraGO business unit | DB Energy business unit | RICs (total) | ||||||||||
| EBIT | 10 | – | – | – | 115 | – | – | – | 125 | ‒ | ||
| Operating interest balance | ‒173 | – | – | – | ‒9 | – | – | – | ‒182 | ‒ | ||
| Operating income after interest | ‒163 | – | – | – | 106 | – | – | – | ‒57 | ‒ | ||
| PPA amortization of customer contracts | ‒1 | – | – | – | – | – | – | – | ‒1 | ‒ | ||
| Other financial result | ‒8 | – | – | – | 0 | – | – | – | ‒8 | ‒ | ||
| Net investment income | 0 | – | – | – | 0 | – | – | – | 0 | ‒ | ||
| Result from special items | ‒55 | – | – | – | ‒38 | – | – | – | ‒93 | ‒ | ||
| Loss before taxes | ‒226 | – | – | – | 68 | – | – | – | ‒158 | ‒ | ||
| Taxes on income | –4 | – | – | – | – | – | – | – | ‒4 | ‒ | ||
| Net loss after taxes | ‒230 | – | – | – | 68 | – | – | – | ‒162 | ‒ | ||
| Net profit after taxes (DB InfraGO AG subsidiaries incl. consolidation) | 3 | – | – | – | – | – | – | – | 3 | ‒ | ||
DB InfraGO AG |
| DB Energie GmbH |
| RICs (total) | ||||||||
| Net profit/loss after taxes | ‒233 | ‒392 | +159 | ‒40.6 | 68 | 135 | ‒67 | ‒49.6 | ‒165 | ‒257 | ||
| Revenues | 8,490 | 8,987 | ‒497 | ‒5.5 | 3,444 | 3,361 | +83 | 2.5 | 11,934 | 12,348 | ||
| Inventory changes | 26 | 14 | +12 | +85.7 | 2 | 2 | – | – | 28 | 16 | ||
| Other internally produced and capitalized assets | 2,364 | 2,417 | ‒53 | ‒2.2 | 40 | 40 | – | – | 2,404 | 2,457 | ||
| Other operating income | 4,245 | 4,066 | +179 | +4.4 | 66 | 48 | +18 | +37.5 | 4,311 | 4,114 | ||
| Cost of materials | ‒5,446 | ‒5,340 | ‒106 | +2.0 | ‒3,015 | ‒2,903 | ‒112 | +3.9 | ‒8,461 | ‒8,243 | ||
| Personnel expenses | ‒5,586 | ‒5,603 | +17 | ‒0.3 | ‒195 | ‒196 | +1 | ‒0.5 | ‒5,781 | ‒5,799 | ||
| Depreciation | ‒1,152 | ‒1,236 | +84 | ‒6.8 | ‒77 | ‒51 | ‒26 | +51.0 | ‒1,229 | ‒1,287 | ||
| Other operating expenses | ‒3,025 | ‒3,500 | +475 | ‒13.6 | ‒149 | ‒158 | +9 | ‒5.7 | ‒3,174 | ‒3,658 | ||
| Operating interest balance/net interest income | ‒172 | ‒280 | +108 | ‒38.6 | ‒9 | ‒8 | ‒1 | +12.5 | ‒181 | ‒288 | ||
| Net investment income | 84 | 83 | +1 | +1.2 | 0 | 0 | – | – | 84 | 83 | ||
| Other financial result | ‒7 | – | ‒7 | – | 0 | 1 | ‒1 | ‒100 | ‒7 | 1 | ||
| Result from special items | ‒55 | – | ‒55 | – | ‒38 | – | ‒38 | – | ‒93 | ‒ | ||
Individual figures are rounded and may not add up to the total.
- No profit transfer to the Federal Government: For 2025, DB AG will not transfer any profits from the RICs to the Federal Government due to the RICs’ overall net loss after taxes according to HGB.
- Loss compensation by DB AG: The total losses incurred by the RICs according to HGB will, as in the two previous years, be offset by DB AG pursuant to the domination and profit and loss transfer agreements.
- No additional investment grants in 2026: Accordingly, in 2026, the Federal Government will not provide any additional investment grants for rail infrastructure through the financing cycle as defined by the LuFV.