Deutsche Bahn's net profit drops by nearly 30 pct

Source: Xinhua| 2019-03-29 00:45:23|Editor: yan
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BERLIN, March 28 (Xinhua) -- Net profits of the German state-owned railway company Deutsche Bahn (DB) declined by 29.2 percent to a total of 542 million euros (608.4 million U.S. dollars) in fiscal year 2018, DB announced here on Thursday.

At the same time, DB's revenues increased by more than 3 percent to around 44 billion euros in 2018.

Passenger numbers for DB's long distance services increased for the fourth year in a row to a record 148 million people in 2018.

"We will be transporting over 150 million long-distance passengers in 2019 for the first time," predicted Chief Executive Officer (CEO) Richard Lutz during the DB's annual press conference on Thursday.

Nevertheless, DB expects pre-tax profits to decline in the current fiscal year. The company counts on earnings before interest and taxes (EBIT) to reach 1.9 billion euros in 2019, after 2.1 billion euros in 2018.

It would be important to acknowledge "side effects" due to "growing pains" associated with the success of rail, said DB CEO Lutz, citing the "unsatisfactory on-time rate" of DB's long-distance trains.

"We must increase our capacity if we are to offer more attractive, on-time service," he stressed. In 2018, over one quarter of DB's long-distance trains were not on time.

German media reported on Wednesday that DB is planning to buy 17 trains from the Austrian railway company WESTbahn to strengthen its long-distance fleet.

The purchase would cost about 300 million euros, and the first trains could be delivered at the end of the year, according to media reports.

On Wednesday, DB's Supervisory Board instructed the Management Board to look at options for the sale "up to 100 percent" of DB's subsidiary DB Arriva, as well as a possible initial public offering (IPO).

DB Arriva, a British public transport company operating bus and train services in 14 European countries, generated revenues of 5.4 billion euros in 2018.

According to DB, this sale should limit the increase of DB's debt and create "financial scope for growth" for DB Arriva. In 2018, DB's debt rose by 5 percent to almost 20 billion euros.