Economic development

Further improvements anticipated in the 2019 financial year.
Noticeable effects of the first application of IFRS 16.
Profit development expected to be weaker.

Anticipated development		2018	2019
	Volume sold – rail passenger transport (Germany) (billion pkm)	84.5	>85
	Volume sold – rail freight transport (billion tkm)	88.2	>97
	Train kilometers on track infrastructure (billion train-path km)	1.1	>1.1
	Shipments in land transport (million)	106.5	~110
	Air freight volume (export) (million t)	1.3	>1.3
	Ocean freight volume (export) (million TEU)	2.2	>2.4
	Customer satisfaction – passengers (SI)	75.1	~77
	Punctuality DB Group (rail) in Germany (%)	93.4	>94
	Punctuality DB Long-Distance (%)	74.9	76.5
	Revenues (€ billion)	44.0	>45
	EBIT adjusted (€ billion)	2.1	≥1.9
	ROCE (%)	5.8	~4.4
	Redemption coverage (%)	17.6	~17

Volume sold should increase further in the 2019 financial year as a result of the improved service quality and the expansion of the services. Train-path demand should also increase as a result. The increase in demand for regional rail passenger transport due to additional regionalization funds as well as for rail freight transport as a result of stimuli created by the master plan for rail freight transport will also have an impact in this respect. The trend of steadily increasing train-path demand from non-Group customers will continue.

We also expect a further positive development in volumes at DB Schenker.

In 2019, our focus is on stabilizing and improving punctuality. The Agenda for a Better Railway. should ensure an improvement in punctuality as soon as the first half-year of 2019.

As a result of the positive performance development, DB Schenker, DB Cargo and DB Long-Distance in particular are expected to drive revenue growth.

In terms of profits, we do not expect revenue gains to be mirrored in profit development. Here, additional expenses, e.g. tariff increases and our measures to improve quality and digitalization will be particularly noticeable.

As a result of the expected slight decline in the development of adjusted EBIT along with a simultaneous significant increase in capital employed (and also first application of IFRS 16), ROCE is expected to decrease. For 2020, we once again expect a noticeably positive development in operating profit and ROCE.

Redemption coverage may above all decrease as a result of the first application of IFRS 16.

Business units are expected to develop unevenly

Anticipated development (€ million)		Revenues adjusted		EBIT adjusted
Anticipated development (€ million)		2018	2019	2018	2019
	DB Long-Distance	4,682		417
	DB Regional	8,968		492
	DB Arriva	5,441		300
	DB Cargo	4,460		– 190
	DB Schenker	17,050		503
	DB Netze Track	5,511		840
	DB Netze Stations	1,314		221
	DB Netze Energy	2,850		21

Above the previous year’s figuret At the previous yearʼs level Below the previous yearʼs figure

DB Long-Distance

At DB Long-Distance, we anticipate revenues in the 2019 financial year above that of the previous year, driven by the improvement to the offer, targeted marketing, measures to improve quality and the expected economic development. This is also positively reflected in the development of adjusted EBIT.

DB Regional

At DB Regional, we anticipate lower revenues in the 2019 financial year and a slightly decreased operating profit development as a result of performance losses.

DB Arriva

The challenging market environment at UK Bus and Mainland Europe and the cessation of the Arriva Trains Wales franchise at UK Trains is likely to offset the positive effects of the first-time full inclusion of VT-Arriva so that revenues and the operating profit ought to develop at a comparable level to that of the previous year.

DB Cargo

At DB Cargo we expect an increase in volume sold in the 2019 financial year because of the effects of the master plan for rail freight transport amongst other reasons. Revenues should therefore increase. The operating profit should also improve.

DB Schenker

At DB Schenker, we expect further growth in revenues and operating profit in the 2019 financial year resulting among other things from volume effects and further efficiency increases.

DB Netze Track

In the 2019 financial year, we expect revenue development at DB Netze Track to be positive as a result of both volume and price effects. Additional expense burdens arising from the Agenda for a Better Railway may, however, lead to a declining operating profit.

DB Netze Stations

At DB Netze Stations, revenues should increase in the 2019 financial year as a result of a volume effect at station stops and annual dynamization. Additional expense burdens arising from the Agenda for a Better Railway will, however, lead to an operating profit development slightly below that of the previous year.

DB Netze Energy

At DB Netze Energy, revenue development should be positively influenced, above all, by price effects, and also lead to an improvement in the operating profit.