July 26, 2017

DB boosts profit forecasts as ridership climbs

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DB boosts profit forecasts as ridership climbs DB AG/Uwe Miethe

GERMAN Rail (DB) announced on July 26 that it will raise its profit forecast for 2017 amid record ridership on German long-distance services and revenue growth at international subsidiaries Arriva and DB Schenker.

Passenger numbers on DB Long Distance services increased 2.4% compared with the first half of 2016 to reach 68 million, with punctuality improving by 2.6% to reach 81%. However, DB CEO Dr Richard Lutz says DB has more work to do to improve on-time performance. “We are not yet satisfied with punctuality as a whole,” he says. “There is more to be done to make our service better and more reliable, and we will continue our work to this end with discipline and determination.”

Passenger volumes in the long-distance sector increased 3.3% to 19.5 billion passenger-km, with 2% growth in the regional segment, which reached 20.5 billion.

Overall traffic on the German main line network rose by 0.5%, with DB’s competitors increasing their market share to 30.8%, compared with 29.8% in the first half of 2016. Rail freight volumes remained relatively flat at 47.8 billion tonne-km, although DB says the German market is showing the first signs of growth in five years.

Arriva carried nearly a billion passengers on its bus and rail services in the first half of this year, with revenues increasing 5.3% to €2.7bn. Ebit rose 3.8% to €110m.

Overall group revenues increased by 5.2% to €21.1bn in the first half of 2017, with Ebit climbing 17.1% year-on-year to €1.18bn. “Zukunft Bahn, our multi-year quality improvement programme, is raising quality, and our customers are rewarding us for that,” says Lutz. Our progress here is one of the reasons why we chose to raise our revenue and profit forecasts for 2017.”

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