2017 Integrated Report – Departure into a new era

Significant rise in capital expenditures

Capital expenditures (€ million)

2017

2016

Change

absolute

%

Gross capital expenditures 

10,464

9,510

+ 954

+ 10.0

Investment grants

6,724

6,190

+ 534

+ 8.6

Net capital expenditures 

3,740

3,320

+ 420

+ 12.7

The increase in gross capital expenditures was mainly due to markedly higher expenditure on track infrastructure and vehicles. Investment grants also increased significantly, accounting for about 64% of gross capital expenditures (previous year: about 65%).

Most of the rise in net capital expenditures was driven by DB Long-Distance, with new ICE trains and the facility infrastructure accounting for the bulk of it.

CHART 2627

Our capital expenditure activities focused especially on measures to improve performance and efficiency in the area of track infrastructure and the rejuvenation of our fleet. The structure of our gross capital expenditures shifted in favor of passenger transport, mainly because of higher capital expenditures on the ICE fleet.

Capital expenditure priorities unchanged in Germany

Gross capital expenditures
by regions
(€ million)

2017

2016

Change

absolute

%

Germany 

9,906

8,956

+ 950

+ 10.6

Europe (excluding Germany)

546

543

+ 3

+ 0.6

Asia/Pacific

61

40

+ 21

+ 52.5

North America

9

10

– 1

– 10.0

Rest of world

5

5

Consolidation

– 63

– 44

– 19

+ 43.2

DB Group 

10,464

9,510

+ 954

+ 10.0

Net capital expenditures
by regions
(€ million)

2017

2016

Change

absolute

%

Germany 

3,184

2,768

+ 416

+ 15.0

Europe (excluding Germany)

544

541

+ 3

+ 0.6

Asia/Pacific

61

40

+ 21

+ 52.5

North America

9

10

– 1

– 10.0

Rest of world

5

5

Consolidation

– 63

– 44

– 19

+ 43.2

DB Group 

3,740

3,320

+ 420

+ 12.7

In the regional breakdown of gross capital expenditures, the focus remained on Germany. The rise can particularly be attributed to higher capital expenditures on vehicles at DB Long-Distance and higher infrastructure expenditures at DB Netze Track. In addition, station modernization increased capital expenditures at DB Netze Stations. Elsewhere, capital expenditures fell, especially in the Other division. 

In the Europe (excluding Germany) region, capital expenditures remained at the previous yearʼs level. Higher capital expenditures at DB Arriva (vehicles at UK Bus) and DB Schenker were almost entirely compensated by a decline at DB Cargo UK, mostly due to the completion of large vehicle acquisitions in the previous year.

One reason for the significant rise in the Asia/Pacific region was capital expenditures on logistics centers in China and Taiwan.

CHART 2631

Investment grants primarily for infrastructure

Of the investment grants received by DB Group in the year under review (€ 6,724 million), almost all of them (€ 6,671 million) related to infrastructure. The most important funding sources for infrastructure capital expenditures are grants, mostly from the Federal Government, the Federal states and local authorities.

Most of these are based on the LuFV and the Federal Rail Infrastructure Extension Act (Bundesschienenwegeausbaugesetz; BSWAG). Additional investment grants are allocated under the Municipal Transport Financing Act (Gemeindeverkehrsfinanzierungsgesetz; GVFG), the Federal Government’s noise remediation program and the capital expenditure program for the future. The European Union allocates grants (Trans-European Network (TEN) and Connecting Europe Facility (CEF)) for infrastructure capital expenditures on TEN.

In addition to investment grants, DB Group also receives (significantly lower) grants recognized as income, mainly in respect of infrastructure.

On the balance sheet, investment grants are directly deducted from the cost of purchase and cost of production of the assets to which they relate. The recognition of all grants is such that the responsible Federal agencies can conduct comprehensive checks to ensure that they are spent in accordance with their purpose and the law.

A transparent description of the various forms of grants is available online.