Deutsche Bahn AG - Company Strategy & Performance Analysis
Deutsche Bahn is one of the leading transport services company offering mobility and logistical services. It mainly offers passenger rail and bus transportation, freight transportation, and track infrastructure services. The company also carries out logistics and distribution and ticket sales for the passenger transport services, engineering services, vehicle maintenance and security services.
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Decline in the volume of transportation of key commodities such as coal lead to revenue decline
The cargo segment of Deutsche Bahn deals with the transportation of freight throughout Europe. The revenue of the segment declined at 4.7% between 2015 and 2016 from US$5,292.3m in 2015 to US$5,041.3m in 2016. The decline in revenue was primarily attributed to the decline in the transportation volume of major commodities such as coal and steel, particularly in the United Kingdom and Germany.
Negative exchange rate lead to decline in the revenue
DB Schenker is the logistics arm of Deutsche Bahn and is globally renowned as a provider of complete logistics solutions. The revenue of the segment declined at 2.5% from US$17.1bn in 2015 to US$16.7bn in 2016. The decline in the revenue was primarily attributed to the negative exchange rate, as well as the decline in diesel prices and air and sea freight rates.
Deutsche Bahn’s revenue registered sustained growth
Deutsche Bahn has witnessed a continuous increase in revenue from H1 2016 to H1 2017. This growth in the revenue is primarily attributed to the strong performance of the DB Arriva and DB Netze track segment. This is mainly due to the company’s expansion into the European markets and the commencement of new services such as the Northern Rail in the United Kingdom and the commencement of new infrastructure projects throughout Europe.
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