DB Cargo (UK) reveals operating loss of more than £40 million - but down on previous year

Freight operator DB Cargo (UK) has slightly reduced its annual operating loss to £44.6 million, down from £49m the previous year. 

However, exceptional items - its modernisation programme - increase the total pre-tax loss to £90.2m (£6.7m in the previous year). Annual turnover was down 1.3% at £267.6m.

Publishing its results for the financial year ending December 31 2023, the subsidiary of the German state-owned operator DB, said its “future focus is on profitable operations”.

The company employs 1,987 people (43 more than the previous year), costing £137.8m. This includes employer’s pension and national insurance contributions of £22.3m (16% of the total figure).

During 2023, DBC launched a “transformation programme to target improvement in profit and modernise the company”. This includes a strategic review of resources, assets, and operational and commercial relationships, resulting in the “significant exceptional costs” increased during the year.

The project also focused on the “design and implementation of a new technology solution” to manage operations, “which will support the strategic agenda for rail logistics solutions”.

Despite the poor financial results, DBC improved operational performance. The number of trains arriving within 15 minutes of the timetable was up from 78.7% to 79.8%, as was reliability (fewer cancellations) from 97.4% to 98.7%.

Looking ahead, DBC said the first indications for track access charges in Network Rail Control Period 7 (starting April 2024) show a figure that will “significantly increase” operating costs.

While DBC’s contracts enable it to recover cost increases, it points out that the price increase “does not support” rail freight growth and “its ability to be price competitive with other modes”.

The accounts also note that at the year end, DBC had 22 locomotives for sale, with a book value of £436,000 (an average of £19,819 each).