•  Declines in volumes in energy-intensive industries and in intermodal transport – especially trans-Eurasian transport affected by low ocean freight rates.
•  Additional burdens due to price increases, in particular for energy and purchased transport services.
•  Operating income development still under pressure.

¹⁾ Figure for the first half of 2022 or respectively as of June 30, 2022, adjusted.

Performance development in Central Europe was driven significantly down by market developments (decreases in demand for steel and chemical transport and intermodal transport) and the EVG’s strike action. In addition, the drop in demand on the trans-Eurasian corridor put a strain on performance. Additional coal transport for safeguarding energy supply in Germany, on the other hand, had a positive impact.

Economic development has improved significantly but is still very challenging due to the operating situation. Operating profit figures improved, driven by revenue development:

• Revenues: Significant increase, as performance-related decline was more than offset by price effects.
• Other operating income: Decrease, including due to the omission of non-periodic reimbursements related to the noise-based train-path pricing system in 2022. In contrast, there are partly compensating effects from an increase in Government grants (higher facility price support in Germany).

On the expense side, there were additional burdens, primarily in cost of materials:

• Cost of materials: Increase, due in particular to higher energy expenses due to higher prices, which in Germany were only partially compensated by the effects of the electricity price brake and for purchased transport services as well as a change in the accounting for major over­­hauls previously shown as capital expenditures. Performance-­related declines had an opposing effect on expenses.
• Depreciation: Capital expenditure-related increase due to additional long-term rentals of locomotives and freight cars.
• Personnel expenses: The increase is primarily due to a slight increase in the number of operating employees.
• Other operating expenses: Personnel expenses were approximately at the level of the first half of 2022. Declines, including a reduction in the rental of freight cars due to performance, were almost completely compensated by additional burdens, in particular by the introduction of Group levy in the first half of 2023.

Capital expenditures decreased as a result of a change in the accounting of major overhauls. In addition, the contract volume of long-term rental contracts for freight cars was reduced.

The number of employees increased slightly as the recruit­­ment and qualification initiative for operational personnel continued.

• The difficult market environment and strikes in the United Kingdom and France are also putting pressure on developments in Spain.
•  Burdens due to higher prices, especially for energy – operating profit development under more significant pressure.

Performance development in Western Europe declined sharply in the first half of 2023: this was due in particular to developments in the United Kingdom and France:

• Declines in demand due to the economic situation and strikes had a negative impact on DB Cargo UK.
• At DB Cargo France, in particular strikes led to a decline.
• As a result of the strikes in France and the United Kingdom, Spain also saw reductions in traffic to Germany and to the United Kingdom.

Economic development was weaker and remained challenging. The operating profit figures declined due to additional burdens. Income growth was more than offset:

• Revenues: A slight increase resulted from price adjustments, which were partially offset by performance-related declines and negative exchange rate effects. Adjusted for exchange rate effects, growth was more significant.
• Other operating income: Also a slight increase; strike-­related compensation payments in the United Kingdom were mainly offset by lower income from locomotives, freight cars and land sales. Adjusted for exchange rate effects, the increase was more significant.

The increase in expenses was driven primarily by the cost of materials:

• Cost of materials: Increase, mainly as a result of, in parts, significantly increased costs for energy (especially at DB Cargo France) and maintenance. Performance-related declines and positive exchange rate effects had a contrary effect, partly reducing expenses.
• Other operating expenses: Increase, among other factors, for costs related to a lost lawsuit in France and a renewed increase in travel activity. Adjusted for exchange rate effects, the increase was even more significant.
• Personnel expenses: Development in line with the first half of 2022. Tariff effects and an increase in the number of employees were offset, among other things, by positive exchange rate effects.

In contrast, the slight decrease in depreciation had a dampening effect.

Capital expenditures decreased as a result of a change in the accounting of major overhauls. In addition, there were delays in various capital expenditure projects.

The number of employees increased, especially in the operative areas of traction unit drivers and maintenance staff.

•  Decreases in performance as a result of the war in Ukraine were more than compensated by new inland transport.
•  Burdens due to increased factor costs, especially for energy.

The performance development in Eastern Europe was slightly positive, driven by new traffic in Poland and Romania.

As a result, operating profit figures also improved significantly. The main reason for this was the development of income:

• Revenues: Significant increase due to new traffic and price effects. Adjusted for exchange rate effects, the increase was somewhat less pronounced.
• Other operating income: Significant increase at a low level, mainly due to higher income from insurance benefits at DB Cargo Polska.

On the expense side, there was a significant but disproportionately low increase arising from volume and performance factors.

• Cost of materials: Appreciable increase, mainly due to the development of demand and rising prices for energy and purchased transport services. Maintenance expenses also increased as a result of a change in the accounting for major overhauls previously shown as capital expenditures. Adjusted for exchange rate effects, the increase was somewhat less pronounced.
• Other operating expenses: Increase due to higher repairs of locomotives in Romania. In Poland, the employment of temporary workers available in the short-term was also intensified as a result of the positive business development. Effects from additions to provision for cargo damage in Poland also increased expenses.
• Personnel expenses: Increase, mainly tariff-related. In addition, DB Cargo Romania significantly expanded its workforce as a result of the positive business development.
• Depreciation: Capital expenditure-related increase.

Gross capital expenditures increased significantly due to the extension of existing long-term rental contracts for locomotives in Romania and Hungary. Investment grants decreased as capital expenditures in Poland were supported by the EU in the previous year.

The number of employees increased as a result of the performance development in Romania.

•  War in Ukraine and energy price increases result in massive decreases in demand on the Eurasian corridor.
•  Additional decline in demand due to uncertainties regarding further economic development.

¹⁾ Figure for the first half of 2022 or respectively as of June 30, 2022, adjusted.

The economic development of the FLS line of business was at the level of the first half of 2022. Income and expenses decreased to the same extent:

• Revenues: Decrease due to losses in Eurasia business as a result of the war in Ukraine was partially offset by the takeover of business from DB Cargo Italia Services (special services), which was reported in the Central Europe region in the previous year.
• Other operating income: Increase at a low level due to increased services for third parties.

On the expense side, there was a decrease driven by the cost of materials.

• Cost of materials: The decline was mainly driven by lower freight rates for truck transports.
• Other operating expenses: Decrease due to lower rent and damage payments.

In contrast, the increase in other expense items had a partially compensating effect:

• Personnel expenses: Increase, primarily due to the higher number of employees.
• Depreciation: Capital expenditure-related increase at a low level.

Gross capital expenditures increased due to long-term renewals of rental contracts.

The number of employees increased mainly due to the allocation of DB Cargo Italia Services to the FLS line of business.