“The railroad has been restructured and renewed in Germany, and rail transport is continuously growing. The burden on the taxpayer is being reduced and DB AG is a reliable employer in addition to being an internationally structured transport company that is prepared for the future.“

During the first six months of this year the company recorded revenues of €15.3 billion, a gain of 5.8 percent or €843 million. The increase in revenues noted for the first half stemmed almost entirely from the organic growth of existing business.

Earnings before interest and taxes (EBIT) rose by €416 million, or 44 percent to €1.35 billion. At the same time gross capital expenditures climbed by almost 20 percent to €2.8 billion. As of June 30, 2007 the number of DB employees had risen by nearly 2,000 over the same year-ago figure to about 231,000. Net financial debt was reduced by €658 million during the first six months.

“As we previously announced, we are able to use our free cash flow from our operational business to reduce our debt,” said Diethelm Sack, Chief Financial Officer at DB. “Furthermore, we anticipate – barring any unforeseen events – that growth for the full year 2007 will slightly exceed the forecast we made in March.”

The company expects comparable full-year revenues to grow by about 5 percent over the same year-ago results, and that EBIT before special items will amount to approximately €2.4 billion in contrast to the €2.1 billion posted for the 2006 financial year.

Rail transport continues to develop at favorable pace

During the first half of this year 1.3 billion persons traveled by Deutsche Bahn trains or buses, or about 21 million more than in the same year-ago period. A total of 913 million people traveled by DB trains, about 4 million more than in the first half of 2006. Total passenger transport performance rose by 523 million to 41.3 billion passenger kilometers, or 36.7 billion rail passenger kilometers (a gain of 525 million rail passenger kilometers). “Despite previous year’s one-time effects like the 2006 FIFA World Cup, and growing competition on the rail, we have been repeatedly successful in convincing more new customers to take our trains in the first half of 2007. This speaks for the attractiveness of our offers,” said Mehdorn.

The increasing internationalization of activities played a role in generating additional growth in passenger transport. In this context Mehdorn mentioned the premiere of scheduled ICE service to Paris and the inauguration of new connections at the end of the year to Copenhagen and Vienna.

Transport and Logistics Activities Continue to Expand

DB’s rail freight transport performance rose by 4 percent to 49.9 billion ton-kilometers. DB anticipates that performance for total rail freight transport in Germany – consisting of the DB Group and all its competitors – will rise by 10 percent in the current year. This will mark the fifth year in a row where rail freight will post a higher rate of growth than the entire German freight transport market.

Train kilometers on the track infrastructure also increased by 4 percent and amounted to 521 million train-path kilometers. The increase of 20 million train-path kilometers was generated equally by DB and non-Group companies. “This is further proof that competition is functioning on the rail,” noted Mehdorn.

DB Group’s international transport and logistics activities continued to develop favorably. “These results show that our strategy of expanding our international logistical networks and strongly linking them to customer-oriented integrated offers was right,“ said Mehdorn. Shipping volumes in European land transport grew by 10 percent. Overall development in our air freight segment is favorable. Ocean freight is continuing to record dynamic growth. Here, Schenker is growing at a faster pace than the market (based on volume shipped).

Profits in all business units develop favorably

DB Group’s business units recorded very good developments in the first half of 2007. In terms of revenue growth the absolute greatest increase was posted by the business units Schenker (up €509 million, or 8 percent to €6.8 billion), Rail Freight (up €95 million, or 5 percent to €1.9 billion), Urban Transport (up 59 million, or 7 percent to €0.9 billion), Regional Transport (up €50 million, or 2 percent to €3.3 billion), and Long-Distance Transport (up €41 million, or 3 percent to €1.6 billion). The structure of revenues based on contribution by business unit remained almost unchanged. As in the same year-ago period, two-thirds of all revenues were generated in Germany.

The most significant rise in profits was posted by the Track Infrastructure business unit (an increase of €147 million, or 100 percent to €294 million), followed by the business units Rail Freight (up €66 million, or 49 percent to €200 million) and Urban Transport (plus €41 million, or 82 percent to €91 million). Development noted for the business units Services (up €29 million, or 42 percent to € 98 million), Long-Distance Transport (up €28 million, or 48 percent to €86 million) and Passenger Stations (up €25 million, or 32 percent to €103 million) was significantly positive.

“Our first step was to get Regional Transport on an economically sound basis. We then turned our attention to Long-Distance Transport, and finally the rail freight business,“ stated Mehdorn. “And now Track Infrastructure is progressing nicely. At the same time our Pro Netzprogram is designed to ensure that the quality and capacities of the track-path infrastructure can be maintained and increased over the mid-term.“