Promising avenues open up for DB Schenker following buoyant performance in 2021

Post By : Rachayita Sidharth
Post Date : April 3, 2022
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DB Schenker is currently in the phase of exhilaration as Levin Holle, Board Member for Finance and Logistics presented the Deutsche Bahn performance report for the financial year 2021 at a press conference today. It is evident that the record profit numbers of DB have now opened up promising avenues for the company, but the future of Deutsche Bahn’s (DB) logistics arm is still unclear – whether it will be a spin-off, a sale, or will it be re-evaluated as a strategic asset within the German state railway utility group.

DB Schenker was extremely successful once again. In uncertain times, Schenker kept its customers’ supply chains stable around the globe. And that had financial benefits. Now facing its 150th anniversary as a company, Schenker has delivered excellent results – record revenues of over EUR 23 billion for 2021, record profits and a pioneering strategy to further improve its competitive position.”

Levin Holle, Board Member for Finance and Logistics, DB Schenker

Holle also went on to talk about the management at DB Schenker made some very sound decisions in situations of high uncertainty, which when coupled with the special circumstances in ocean and air freight market, eventually yielded the 75% profit increase at DB. He cited a few examples of difficult but profitable decisions made by the DB Schenker management, including the decision to set up their own charter network in the air freight market, decision to expand climate-friendly, biofuel-based transport options. Holle said that the mangement worked tirelessly to take each of their business segments to the next level, and that put DB Schenker in an excellent position for sustained growth.

It is being debated though whether DB’s exceptional profits will be available for M&A or re-investing. Or instead, will the company be viewed as a timely ‘golden egg’ by its parent, re-evaluated as a strategic asset, with a good part of its profits going towards subsidising DB’s rail services. What ever the decision may be, it would definitely impact the gap between DB Schenker and the ‘Big Three’ (DHL GF, K+N, and DSV), and the impact can be positive as well as negative.

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