DB Schenker improves EBIT despite lower revenues

The freight forwarding unit of European rail giant Deutsche Bahn AG saw earnings before interest and taxes increase 3.8 percent to 410 million euros (U.S. $438.5 million) on revenues that slid 2.2 percent to 15.1 billion euros in 2016.    DB Schenker saw full year earnings before interest and taxes (EBIT) increase 3.8 percent to 410 million euros (U.S. $438.5 million) in 2016, according to the most recent financial statements from parent company Deutsche Bahn AG.
   Revenues at the European rail giant’s freight forwarding unit, however, slid 2.2 percent to EUR 15.1 billion compared with the previous year.
   The improved EBIT came as airfreight traffic increased 4.5 percent year-over-year to 1.18 million metric tons, and ocean volumes grew 3.3 percent to just over 2 million TEUs. Volumes in the company’s European land transport division were flat (up 0.3 percent) compared with 2015 at 99.6 million shipments.
   Rail freight, on the other hand, was down 7.6 percent to 277.4 million metric tons transported compared with the previous year.
   Parent company Deutsche Bahn posted a net profit of EUR 716 million (EUR 1.62 per share) for the year compared with a EUR 1.31 billion (EUR 3.08 per share) loss in 2015, as revenues remained relatively flat (up 0.4 percent year-over-year) at EUR 40.6 billion.
   Deutsche Bahn CEO and Chairman of the Management Board Richard Lutz said in a conference call discussing the group’s 2016 financial results that “all arrows are pointing up at DB Schenker.”
   “Contract logistics in particular made gains again and increased its revenues by 7 percent year on year, to EUR 2.5 billion,” said Lutz. “In contract logistics specifically, and at DB Schenker as a whole, we are taking advantage of the opportunities afforded by digitalization to put ourselves in a good position for the future.
   “First, we are working on the digital logistics center of the future as part of our strategic innovation partnership with the IT provider Cisco,” he added. “Second, we are putting DB Schenker’s European land transport activities on a new footing by partnering with uShip.
   “We signed an agreement with the US online freight marketplace in 2016 and have now officially launched our partnership. For the first time, we are connecting land transport carriers and freight online, using just smartphones and tablets and uShip technology.”
    Austin, Texas-based uShip, an online shipping marketplace and freight automation software provider, said in February it had raised $25 million through a “Series D” round of funding led by DB Schenker, which is also a uShip customer.