ANNUAL REPORT 2017 KEY FIGURES SALES REVENUES IN EUR MILLION OPERATING RESULT IN EUR MILLION ANNUAL NET PROFIT IN EUR MILLION EMPLOYEES (FULL-TIME)

Transcription

1 ANNUAL REPORT 2017

2 KEY FIGURES ANNUAL REPORT 2017 SALES REVENUES IN EUR MILLION 447,5 450,2 OPERATING RESULT IN EUR MILLION 0,32 0,10 ANNUAL NET PROFIT IN EUR MILLION 0,98 0,67 EMPLOYEES (FULL-TIME) TOTAL VOLUME OF CONSIGNMENTS NATIONAL TRANSPORT INTERNATIONAL TRANSPORT

3 CONTENTS DIGITALISATION OF INTERMODAL SUPPLY CHAINS KV 4.0 Kombiverkehr drives project forward with network partners more on page 15 TRAINING NEW RECRUITS IN INTERMODAL LOGISTICS Kombiverkehr introduced apprenticeships in forwarding and logistics in August 2017 more on page 45 KOMBIVERKEHR FACILITATES DEVELOPMENT OF EN In February 2018 the new European standard for cranable trailers came in more on page 23 FOREWORD 4 BUSINESS DEVELOPMENT Volumes and financial development 10 SERVICES Intermodal networks 20 National transport 21 International transport 22 INTERMODAL LOGISTICS MANAGEMENT UIRR 34 Operations 35 Private traction 36 Wagons 36 Terminals 37 Information management 41 PERSONNEL Personnel development 44 Organisation chart 47 ANNUAL FINANCIAL STATEMENTS Balance sheet 50 Profit and loss account 51 Audit certificate 52 APPENDIX Corporate institutions 56 Equity interests 60 IMPRINT ANNUAL REPORT 3

4 FOREWORD SETTING THE COURSE TO MEET THE REQUIREMENTS OF OUR CUSTOMERS The 2017 financial year was without doubt one of the most difficult in Kombiverkehr s 49-year history. The number of unforeseen events outside our control has never been as high as it was in the last financial year. Infrastructure was the central issue here, with the closure of the Rhine corridor near Rastatt causing particularly severe disruption to our train operations. Other measures also had an adverse impact on rail freight transport, however. These included checks on refugees at the German-Austrian border and, right at the end of the year, the complete closure of the Brenner corridor for more than 14 days as a result of an accident. Armin Riedl Managing Director Robert Breuhahn Managing Director Much has been said and written about the closure of one of the most important corridors in European rail freight transport in the Rhine Valley. In this respect, we have no wish to go into the matter any further. Suffice to say that our company and our customers had to deal with the aftermath of this event, which affected all traffic between Germany and Switzerland, our transit services via the Gotthard corridor to Italy and, indirectly, transfers and inbound traffic on these routes. The duration of the route closure and the lack of adequate diversions led to significant losses in Kombiverkehr s overall network. Rail freight transport companies, operators and affected network operators made every attempt to find acceptable temporary solutions for the market but were unable to prevent a large number of consignments from not being shipped and thus being lost to Combined Transport. We subsequently supported all the efforts made by the companies concerned to learn from this incident for the future. The importance of the standardisation of operating systems and the Europe-wide introduction of a mandatory language for cross-border rail freight transport has become clear once again. That is because, in spite of all its environmental benefits, the railway is ultimately measured against the efficiency of its main rival, the road. We have begun to discuss the economic consequences of such events for rail-dependent carriers and freight forwarders in talks with representatives from the federal ministries in charge of economic affairs and transport. It has not been possible to conclude these talks due to the elections and the lengthy process of forming a government, but they are continuing. The aforementioned refugee controls between Germany and Austria imposed substantial restrictions on Kombiverkehr s busiest international axis from the second half of Our regular schedule via Brenner was severely disrupted, with trains heading north delayed for up to five hours at peak times and tailbacks reaching a long way into Austria. Thanks to effective cooperation with the authorities, most notably the Federal Ministry of Transport 4 FOREWORD 5

5 and Digital Infrastructure, we and our service providers succeeded in improving operations towards the end of the year in a way that was consistent with the necessity of measures to secure the border. We have still not been given the all-clear, however, and the checks are still being carried out. As if this were not enough, traffic via Brenner was brought to a complete standstill after an accident at the end of the 2017 financial year. Although the route was closed between Christmas and New Year when traffic is less busy, we still had to post losses in spite of ad hoc measures taken by our service providers to divert 44 trains through the Tauern corridor. And, needless to say, operations were disrupted by the weather once again during the last financial year, but we have become used to this phenomenon over the past few years. We have since become familiar with names such as Egon, Thomas, Sebastian, Xavier and Herwart. These low-pressure systems led to massive disruption in large parts of our CT network for a total of nine weeks in All in all, therefore, we take a positive view of the fact that our volume of transport stabilised at virtually the same level as the previous year. We managed to generate volume increases in the transport markets that were not affected, or only affected to a slight extent, by the aforementioned factors. This relates to large parts of domestic transport, Baltic Sea transport and traffic with Scandinavia. In particular, National Transport reached a peak value for the second time in succession. This trend proves once again that the demand for intermodal transport services can be increased if underlying conditions are stable and products and services are in line with market requirements. This is why we take a very positive view of efforts to improve general transport policy frameworks for Combined Transport, at both national and international level. In this respect mention must first be made of the master plan for rail freight transport, which has been drawn up by a ministry-appointed round table with the assistance of Kombiverkehr. The programme was presented to the public in Berlin on 23 June 2017 by Alexander Dobrindt, who was Minister of Transport at the time. In our view it is the white paper for the future development of the rail freight transport sector in Germany. This master plan deals with three essential elements: it highlights the significance of the railway for future freight transport, it aims to relieve the pressure of external costs, and it supports the ongoing technical and digital development of the system. On the subject of costs, the announced significant reduction of route prices is in the public spotlight. We now expect the political community to ensure that measures described as short-term in the master plan for rail freight transport are implemented quickly. The negotiations to form a coalition government lasted longer than anticipated. The outcome on transport policy gives us reason to feel positive: all the key demands of the industry, in particular the implementation of the master plan, can be found in the new coalition agreement. We are convinced that the railway system will become more important in future as general transport policy frameworks are improved and more funds are provided for its development. We and our service providers may have had to contend with the difficulties described, but let s not forget that the real victims are our customers and the forwarders and carriers whose logistics are reliant on the Combined Transport system. The consequences especially the financial ones of route closures or refugee controls should not have to be borne by them alone. The procedure to amend the CT Directive 92/106 is ongoing in the sphere of international transport policy. The EU Commission published its proposal in November We consider it to be great progress that the content of the 44-tonne rule on the first and final leg has been revised and no longer includes 40-foot ISO containers only. Instead, it has now been extended to cover all types of swap bodies and containers up to 45 feet. For some reason we cannot understand, however, this rule does not apply to semitrailers. The semitrailer has been the growth segment in continental rail-road Combined Transport for years. This is why we will persist in working with our umbrella organisation, the UIRR in Brussels, and other partner companies to ensure that legal certainty in relation to this issue is established in the cross-border Combined Transport sector. The fact that the legal situation currently differs elsewhere in Europe leads to many of our customers being repeatedly involved in proceedings for the imposition of administrative fines and the confiscation of vehicles and goods, and ultimately hinders the free movement of goods. Even though the new regulation is certain not to be without its compromises as an EU regulatory system, having evaluated the current draft we believe it will be better than the existing directive. After a lot of hard work, the EN standard for semitrailers has also made it possible to adopt a system of rules which defines the rail-specific requirements of cranable semitrailers. Thanks to this new Euronorm, European standards have now been defined which make handling safer in the terminals on the basis of technical specifications on the one hand and facilitate the development of a standardised fleet of vehicles, and hence investment in this type of transport unit by forwarders, on the other hand. Last but not least, the industry has very high expectations when it comes to digitalisation. The KV 4.0 project was launched in the last financial year at the initiative of Kombiverkehr and involves the following partners: DB Cargo, Lokomotion, SBB Cargo, Hupac, KTL Ludwigshafen, Hoyer, Paneuropa-Rösch, Bertschi and Kombiverkehr. The aim is to establish a shared data platform between network providers, rail transport companies, terminals, operators and forwarders to ensure that all the accompanying data for shipments is available to the highest standards of accuracy in digital form and in real time. It should be possible for all companies involved in the transport chain to call up the information required to execute their processes at any time. Terminals should know how many trucks are on the first leg and customers the exact status of their consignments, etc. This may all sound rather banal, but you only have to look at the number of players involved and thus the amount of interfaces as well as the nature and quantity of the information required to realise what a challenge the implementation of KV 4.0 poses for the project partners. The transport market is undergoing a digital transformation and we hope to use the measures described to set the course to meet the requirements of our customers wherever possible. We want to dismantle bureaucratic obstacles in cross-border intermodal transport by improving and, in particular, standardising general transport policy frameworks. We hope that the right lessons have been learned from the route closures in 2017 so that the success story of Combined Transport can continue to be written. We will be building on our position as market leader in Europe once again in 2018 with new products and innovative concepts. We, the team at Kombiverkehr, are looking forward to the opportunities the future will bring. Robert Breuhahn Armin Riedl 6 FOREWORD 7

6 BUSINESS DEVELOPMENT WITH 958,299 CONSIGNMENTS EUROPEAN MARKET LEADER Problems with infrastructure resources, refugee checks and environmental factors made it difficult for Kombiverkehr to meet the high demand on certain routes in the 2017 financial year. The operator nevertheless chalked up 958,299 transported truckloads at the end of the year. The strongest growth was achieved in Northern European Transport at 4.4 per cent. 8 BUSINESS DEVELOPMENT 9

7 VOLUMES AND FINANCIAL DEVELOPMENT GROWTH IN SOME MARKET SECTORS Although Kombiverkehr increased volumes in individual market sectors during the 2017 financial year, the company was not able on the whole to follow its growth course of the past two years. The European market leader in intermodal road-rail transport shifted 958,299 truck consignments in unaccompanied Combined Transport, thus falling short of the previous year s result by 2.8 per cent or 27,125 consignments. Converted into TEU (Twenty Foot Equivalent Unit), the volume amounted to 1.92 million TEU during the year under report. The volume of freight transported by Kombiverkehr trains fell to 22.8 million gross tonnes ( 1.5%). Apart from operational problems on individual corridors, the company s result was seriously affected by the seven-week closure of the Rhine corridor due to track settlement near Rastatt and by refugee checks on the German-Austrian border. TRANSPORT VOLUMES IN CONSIGNMENTS* 1,000, , , , ,000 In spite of this trend, Kombiverkehr remains Europe s leading player in road-rail Combined Transport. The consignments delivered by forwarders and carriers removed 802 million vehicle kilometres from German and European trunk roads, equating to a daily average of 3,822 truck journeys shifted onto the railways. The average transport distance of consignments rose again and, at 836 kilometres, exceeded the previous year s amount by 2.1 per cent. As a result, transport output was up by 0.6 per cent to 19.1 billion tonne-kilometres. By opting for intermodal transport, the customers of Kombiverkehr prevented the emission of some 1.1 million tonnes of carbon dioxide and around 3,400 tonnes of nitrogen oxide, thus contributing to climate-friendly logistics Accompanied transport National unaccompanied transport International unaccompanied transport * One consignment corresponds to the capacity of a truck or semi-trailer. NATIONAL AND NORTHERN EUROPE ON THE UP With 207,589 truck consignments transported, Kombiverkehr posted a gain of 2.3 per cent on the routes in the national de.netdirekt+ network during the 2017 year under report. This is all the more remarkable given that the damage near Rastatt had a severe impact on transport within Germany along the Rhine corridor for a period of seven weeks. On top of this, several bouts of bad weather, predominantly in the north of Germany, led to route closures lasting several days and numerous train cancellations. Forwarding volumes in the international eu.netdirekt+ network, including traffic with the German Baltic Sea port, fell by 4.1 per cent to 750,710 consignments compared with Transport between Germany and northern Europe was a growth market. By adding to the number of train services on this axis, Kombiverkehr increased volumes for the fourth time in succession, this time with a gain of 4.4 per cent or 2,826 truck consignments. Particular mention must be made here of the growth in traffic across the fixed link and via Baltic Sea ports to Sweden which, with 48,840 consignments, now accounts for one third of the volume of transport to northern Europe. The volume of traffic between Germany and western European nations decreased by 0.6 per cent in total. This is entirely attributable to the decline in container traffic with the Netherlands. In contrast, there were significant volume increases in all other bilateral services between countries. During the period under report 7.7 per cent more truck consignments were carried on the routes with Spain and Portugal compared with the previous year. Kombiverkehr also saw an above-average increase in the volume of consignments for France. The growth in foreign trade between Germany and these countries brought about by economic conditions played a substantial part in this trend. It was not possible to maintain the levels of previous years on the transalpine routes between Germany and Italy. During the period under report 4.9 per cent fewer consignments were transported than in In particular, there were disproportionately high losses on services to and through Switzerland as a consequence of the track closure near Rastatt. In the month of September alone half as many consignments were transported as in the preceding year. It was only possible to divert a limited number of services for Italy to the eastern transalpine routes. This was because capacity in the Brenner corridor was severely curtailed by engineering works which coincided with measures to carry out checks on refugees at national borders between Germany, Austria and Italy. Kombiverkehr managed to increase the number of consignments transported on the Brenner route, the busiest link, by 1.5 per cent in spite of these difficult conditions. Kombiverkehr recorded some substantial volume increases in traffic with Poland, Slovenia and Turkey in the eastern European market segment. In total, however, the volume of consignments fell by 15.3 per cent. The opposing trends in traffic within Germany and cross-border transport did not result in any notable shifts in volume distribution: the international sector still accounts for nearly 80 per cent of the total volume of business at Kombiverkehr. 10 BUSINESS DEVELOPMENT 11

8 VOLUMES AND FINANCIAL DEVELOPMENT NO STIMULUS FOR RAIL DESPITE VIBRANT ECONOMY During 2017, the year under report, the Germany economy enjoyed its strongest period of growth since Germany s gross domestic product increased by 2.2 per cent in an economically stable European environment. This upward trend was underpinned by foreign trade and, to an increasing extent, by the domestic economy. In the second half of the year in particular, Germany profited from a global upswing which has since encompassed the euro area as well. On the whole, this economic development had a positive impact on the transport industry in Germany. The high demand for transport services resulted in freight rates in the long-distance road haulage sector rising for the first time in years because, among other things, spare cargo capacity in trucks became increasingly scarce and the price of diesel increased slightly. Forwarders also bemoaned increasing driver shortages there is talk of 45,000 truck drivers needed in Germany alone, and this figure is set to rise in future. In spite of what were favourable TRANSPORT VOLUMES IN CONSIGNMENTS National unaccompanied transport economic conditions for the railway system as a whole, the rail freight transport sector was unable to take advantage of these factors in 2017, the year under report. Whilst the current figures on the market share of the modal split are not yet available, it must be assumed that it has shifted further in favour of road haulage. 207, , , , , , , , ,095 International unaccompanied transport INFRASTRUCTURE PROBLEMS AND BORDER CONTROLS SLOW DOWN GROWTH Diverse external factors clearly had an adverse effect on the efficiency of the CT networks in the 2017 financial year and prevented sustained improvements to quality across the network to a standard that is acceptable for our customers. At the same time, the busiest transport axis to and from Italy was exceptionally hard hit by disruptions to operations. The operation of scheduled train services in the Brenner corridor has only been possible on a sporadic basis since August 2017, when checks on refugees were introduced at the German-Austrian border. These measures are not only impacting trains coming from the south. The opposite track was also closed initially for safety reasons, with all traffic coming to a standstill for hours on end as a result. The long waiting times and frequent delays tied up the resources of the affected railways to the point where it was no longer possible to stick to timetables. Countless scheduled trains had to be cancelled and requests for special trains were generally refused. In close cooperation with its partner railways, Kombiverkehr held a number of talks with the border agencies and managed to have the controls moved to separate sidings without blocking the main track. The aim of bundling measures between the countries concerned Italy, Austria and Germany in such a way that checks are at best only carried out at one border crossing is yet to be achieved, however. Given the current political situation, an end to these measures is not yet in sight. The consequences of the route closure in the Rhine Valley after the track settlement near Rastatt were catastrophic, not least because no diversion plans had been drawn up for one of Europe s busiest railway corridors. The two eligible alternative lines on the German and French side were only able to absorb around 25 per cent of the normal number of train services. First of all, the route via Stuttgart does not have continuous electrification. Secondly, German train drivers cannot be deployed on the French section of the line because the usual rules regarding language skills and route knowledge apply to train drivers. Xavier, the first autumn storm, blew in immediately after the reopening of the Rhine corridor at the start of October and brought rail traffic to a complete halt in northern Germany. The second storm followed a few weeks later, likewise homing in on the north and east of the Federal Republic. Falling trees inflicted so much damage on the railway infrastructure on both occasions that it took more than a week in the case of the Xavier low-pressure system at least until all the tracks were fully reopened. Given the severity of the effects, and assuming that climate change will produce more extreme weather, network operators are increasingly confronted with the question of whether the damage could be minimised by taking preventive measures to control vegetation along the tracks. Quite apart from the fact that these events harm the image of the railway system in the eyes of the public, the users of intermodal transport are not only affected by inadequate quality, but also incur high consequential losses as a result of waiting times and missed delivery deadlines. Taken together, these factors militate against the competitiveness of intermodal transport compared with end-to-end long-distance road haulage. 12 BUSINESS DEVELOPMENT 13

9 VOLUMES AND FINANCIAL DEVELOPMENT OUTLOOK FOR 2018 The last federal government stated its intention to increase the share of the eco-friendly rail freight sector in the market for transport services. The sector has for a long time indicated that it would only be possible to achieve this aim by offering the logistics industry rail transport services which are competitively priced and of a high quality. In order to create the conditions for this, the Federal Ministry of Transport and Digital Infrastructure approved the master plan for rail freight transport at the end of last year along with transport federations and key players in the rail industry. The plan is meant to reduce the cost burden and strengthen the rail freight transport sector. When implemented, this plan should upgrade the infrastructure, speed up modernisation and digitalisation, and improve frameworks. Measures planned for the immediate future include the reduction of route prices charged by DB Netz and the upgrade of key sections of track for 740-metre goods trains. Kombiverkehr assumes that the lowering of route prices in particular will act as a positive stimulus for the railway. Our partner railways, first and foremost DB Cargo, have also tried to counteract the decline in quality with a series of measures. A start has been made in individual corridors to establish end-to-end train management from departure to arrival at the destination terminal in order to reduce interfaces and limit jurisdiction to a few agencies. A shortage of train drivers on the railways has repeatedly meant that parked or delayed trains could not be transported onward during the past year. A training and recruitment initiative launched by some railways should help to remedy this situation. When it comes to digitalisation, Kombiverkehr has joined forces with other operators, railways, terminals and freight forwarders to launch the government-funded project Digitalisation of intermodal supply chains KV 4.0. The ultimate aim is to bundle all transport-related data on one platform in order to make the processes between booking the forwarding service and collecting the transport unit at the destination terminal more transparent for the customer and thus easier to plan. The economic forecasts are optimistic, with a 2.3 per cent increase in gross domestic product expected in Various factors could nevertheless put the brakes on this rally: the political situation in Italy is unstable after the last elections, the USA is threatening protectionist measures and the Brexit negotiations between the EU and Great Britain are dragging on. Kombiverkehr assumes there will be slight gains in national and cross-border consignment volumes over the coming year, some of which will be generated by new business and some from upping the frequency of trains. In the medium term it is expected that measures such as the 740-metre network for longer freight trains, further standardisation in European rail transport and the implementation of digitalisation processes will act as a positive stimulus for unaccompanied Combined Transport. DIGITAL SUPPLY CHAIN IN INTERMODAL TRANSPORT DRIVEN FOR- WARD During the past financial year an important scheme for the modernisation and future viability of the intermodal sector within the logistics industry was launched in the form of the Digitalisation of intermodal supply chains KV 4.0 project. Kombiverkehr began working on the project in September 2017 along with its network partners DB Cargo, Lokomotion, SBB Cargo Deutschland, KTL Ludwigshafen, Hupac Transport, HOYER, Paneuropa Transport, Hupac Intermodal, Bertschi and Hupac SpA. The primary goal of KV 4.0 consists in making the logistical process more transparent and manageable 14 BUSINESS DEVELOPMENT 15

10 along the entire intermodal transport chain, starting with the collection of the transport unit from the shipper to its delivery to the recipient. The project is divided into nine specialist work packages and progress has already been recorded and explained in detail in a milestone report. Examples of the work packages include timetable data CT operators, order information forwarders, status reports terminal and train movements/resource planning EVU (rail transport companies). In addition, the project group is currently dealing with the identification of key reporting points for TARGET, ACTUAL and temporal forecasts ( ETA/supply ) along the intermodal transport chain. The conceptual design of the system architecture for the IT hub is being done in parallel. The project partners had to complete the initial performance specifications by May 2018 so that they could be discussed and coordinated by the end of July. The subsequent phase will then entail, among other things, appointing a system operator to co-design the hub and technically implement it. DEVELOPMENT OF FINANCIAL POSITION AND RESULTS OF OPERATIONS Kombiverkehr generated freight earnings of EUR 448,389k in the 2017 financial year, which turned out to be EUR 1,814k less than the previous year. The 2.8 per cent decline in the volume of consignments was seen alongside a disproportionately low fall of 0.6 per cent in freight earnings due to the growth of long-distance transport services The decrease of EUR 5,143k in other operating income due to the completion of funding projects the previous year was accompanied by a EUR 3,914k increase in gross profit. Personnel expenditure rose by EUR 399k in the 2017 financial year as a result of wage adjustments and personnel measures. Writedowns were reduced by EUR 133k as planned, mainly due to lower writedowns for wagons. Other operating costs were down by EUR 1,715k due to lower transferred costs and as a result of making provision for risk the previous year. The operating result increased by EUR 220k to EUR 321k. The financial result improved by EUR 75k to EUR 830k, which is attributable to higher investment income. The annual net income after the deduction of income tax was EUR 977, for the period under report. SALES REVENUES IN EUR MILLION ASSET POSITION Kombiverkehr s total assets on the balance sheet date came to EUR 64,470k, which represents an increase of EUR 10,981k. On the asset side this is due to an increase in cash in other banking accounts on the balance sheet date, and on the liabilities side essentially due to the increase in freight payables and to undertakings with which the company is linked by virtue of participating interests. The reason for the balance sheet extension is a deferred settlement of freight payables to the following year and the increased expense of processing incoming invoices. Compared to the previous year, therefore, the capital ratio of per cent is slightly lower based on the balance sheet date

11 SERVICES NEW TRAIN SERVICES ENLARGE THE NETWORK Last year Kombiverkehr provided 204 national and 468 international direct and multi-group trains every week by introducing new and more frequent services on various routes. Europe's largest intermodal network thus comprises a total of 672 shuttle trains a week. 18 SERVICES 19

12 INTERMODAL NETWORKS OPPOSING TRENDS IN NATIONAL AND INTERNATIONAL TRANSPORT NATIONAL TRANSPORT After some very encouraging growth during the 2015 and 2016 financial years, forwarding volumes proved to be weaker than expected in 2017 in spite of further network improvements. Whilst National Transport at Kombiverkehr grew once again, the volume of International Transport declined after two record-breaking years in a row. Once again, the reason for this was the highly unfavourable frameworks in the European rail freight transport sector. Kombiverkehr saw an overall decline in the volume of transport during the 2017 financial year due to the adverse effects of the weather, the rigorous checks on refugees, the route closure near Rastatt and, yet again, the unsatisfactory performance of the railway. The number of transport units shipped in the national and international networks fell to 958,299 consignments (1.92 million TEU), which equates to an overall decline of 2.8 per cent compared with the preceding year. Services to and from Italy were particularly hard hit by the aforementioned factors. Whilst the track closure at Rastatt was the subject of public discussion, the consequences of the rigorous checks on refugees on the Brenner axis were no less serious even though they received little public attention. These measures upset some of our shuttle train schedules to the extent that complete round trips had to be cancelled repeatedly at short notice. The ensuing unpredictability of train departure times led to many transport units having to be stored temporarily in the terminals after they had been delivered. This is why many terminals reached the limits of their capacity and sometimes had to stop accepting deliveries. In turn, these measures had a negative impact on the entire network. After a moderate rise in 2016, national Combined Transport increased forwarding volumes in the 2017 financial year by a total of 2.3 per cent to 207,589 consignments, or around 415,000 TEU, compared with the previous year. This significant growth in traffic in our German domestic market was achieved in spite of a series of negative factors. As well as the still unsatisfactory performance of the railways, particular mention must be made here of the seven-week closure of the Rhine Valley section of track between Rastatt and Baden-Baden. As a result of this, for example, all our Wuppertal/Cologne Basel and Hamburg Basel trains had to be temporarily suspended, which caused a proportional decline in the volume of traffic on the affected route. To compensate for this disruption at short notice, Kombiverkehr processed consignments on the two above-mentioned routes by using the newly established Cologne Karlsruhe v.v. replacement service in conjunction with the existing Hamburg Cologne v.v. gateway service. The consignments could then be transported from Karlsruhe to Switzerland by road. This additional service was supported by the Swiss Ministry of Transport, which placed all terminals in Baden-Württemberg on an equal footing with the Swiss terminals VOLUME OF NATIONAL TRANSPORT (EXCLUDING BALTIC SEA TRANSPORT) IN CONSIGNMENTS ,589 whilst the track was closed so that our customers could use Karlsruhe for the first and final leg and travel all the way to Switzerland with a total weight of 44 tonnes during this limited period of time. Kombiverkehr also managed to expand its national train services once again during the past financial year, regardless of the generally difficult conditions. The frequency of departures on the Duisburg Ludwigshafen route had been doubled from five to ten a week in each direction by the beginning of May. In September the number of departures on the route between Leipzig and Munich was likewise doubled from three to six. With over 200,000 consignments transported in the German rail network, national Combined Transport remains a vital cornerstone of our network. The national train products assembled under the name de.netdirekt+ also continue to form the backbone of many first and final legs by rail in international transport. The national trains are also a vital fallback option for gateway services in the event of surplus demand or the seasonal suspension of international trains. At around 22 per cent, national transport accounts for a significant share of total volumes at Kombiverkehr. In the 2017 financial year a total of 20 terminals throughout Germany were linked with the help of 64 terminal-terminal services, some of them several times a day. Every week 204 direct and multi-group trains operate between Germany s leading economic regions in the national network. This means a daily average of over 830 truckloads are shifted from road to rail , , SERVICES 21

13 INTERMODAL NETWORKS INTERNATIONAL TRANSPORT As well as 17 bilateral services between countries, international Combined Transport comprises services to and from the German Baltic Sea ports of Kiel, Lübeck and Rostock with their connections to the Baltic Sea ferries. It was not possible to improve the result after two record-breaking years in succession. With 750,710 consignments, or 1.5 million TEU, 4.1 per cent fewer transport units were shifted in total in the 2017 financial year than in the previous year. SOUTHERN EUROPE Despite a 4.9 per cent fall in volumes, south European transport remains Kombiverkehr s most important transport axis with a total of 394,981 consignments (790,000 TEU). Around 41 per cent of our total volume of consignments is transported between Germany and Italy as well as Germany and Switzerland. At present, Kombiverkehr provides a total of 230 direct train services every week on the Germany Italy/Switzerland corridor and thus links major economic regions in the three countries with regular services on 46 routes. VOLUME OF INTERNATIONAL TRANSPORT (INCLUDING BALTIC SEA TRANSPORT) IN CONSIGNMENTS , ,719 76, ,042 74, ,737 Baltic Sea transport with connection to Northern Europe Bilateral transport 750, , ,392 Transport flows to and from Italy are spread across the four main alpine crossings of the Brenner Pass and Tauern in Austria and Gotthard and Lötschberg in Switzerland. With 229,105 transported consignments, Brenner was again by far the most important corridor for Kombiverkehr during the last financial year, followed by the Swiss corridors with 116,684 consignments and the Tauern line with 35,687 consignments. Kombiverkehr uses the transalpine axes to operate regular shuttle trains between the Italian terminals in Verona, Milan, Trieste and Venice and 14 sites in Germany (Kiel, Rostock, Lübeck, Bremen, Hamburg, Hannover, Wuppertal, Duisburg, Cologne, Frankfurt, Ludwigshafen, Leipzig, Nuremberg and Munich). TRANSALPINE TRANSPORT VIA AUSTRIA GOING STRONG Sectoral driving bans, convoy controls, Brenner tolls, route closure at Rastatt and a driver shortage are just a few of the buzzwords that should have been conducive to booming business in Combined Transport via Brenner. While the volume of traffic on the Brenner axis increased during the last financial year for the third time in succession, an increase of just 1.5 per cent is comparatively modest and was not enough to compensate for the declining volumes of traffic on the other three alpine crossings. There was a noticeable increase in the demand for capacity in Combined Transport via Brenner, which was driven by the generally favourable conditions. In collaboration with our Italian partner Mercitalia Intermodal (formerly Cemat), 12 more trains were brought in on four routes to boost the existing number of weekly departures between Germany and Italy. The routes in question were Cologne Verona (from 11 round trips to 12), Munich Verona (from five round trips to six), Bremen Verona (from six round trips to eight) and Ludwigshafen Verona (from six round trips to eight). The fact that the volume of Brenner traffic failed to grow as well KOMBIVERKEHR FACILITATES DEVELOPMENT OF EN DEVELOPMENT Kombiverkehr has played an active role in standardisation bodies to create a European standard (Euronorm) for cranable trailers. This standard was published in February It describes the rail-specific requirements of semitrailers which are transported by rail with pocket wagons. The key aspect is the definition of the largest possible envelope for semitrailers, i.e. the maximum available clearance space for a semitrailer laden or unladen in the prescribed loading position in pocket wagons. This figure must not be exceeded. Among other things, the standardised envelope takes into account the T3000e, TWIN and T5 megatrailer pocket wagons, which have been developed in recent years and procured in large numbers. This means that a large number of 22 SERVICES 23

14 suitable wagons are already operational and available for trailers which are now built in compliance with EN When it comes to further advances in pocket wagon technology, the standard provides the dimensions that must be taken into consideration for wagon envelopes. Different types of pocket wagons were built in the past and they placed differing demands on trailers in terms of retractable underride guard, wheelbase, spare wheel holder, grappler pockets and low-lying vehicle components. The problem with this was that the vehicle manufacturers had to consider different pocket wagon construction types when building trailers. Whilst the question of which trailer fitted on which pocket wagon was solved with what is known as the compatibility code, an increasing amount of effort and expense actually went into providing suitable pocket wagons at the terminals. EN should improve this situation in the future by ensuring that any trailer can be loaded onto any modern pocket wagon. as originally hoped was due primarily to serious problems with quality, which were not caused by the railways. Rather, the unannounced and above all uncoordinated refugee controls on both sides of the Alps resulted in what were at times chaotic conditions for intermodal supply chains. Much of the desperately needed additional line capacity was wrecked as a result of the fact that checks on refugees between Munich and Kufstein were initially conducted on the open track. This often entailed the whole route being closed in both directions for hours on end. Complete round trips had to be cancelled due to the ensuing delays as the required wagons failed to arrive at the terminal on time. Terminals were no longer able to work efficiently as so many transport units were placed in temporary storage. Customers had no other choice than to turn to road haulage if they wanted to get their goods to their destination on time. To make matters worse, another serious rail accident in December 2017 led to a full closure of the Brenner line for a number of weeks, thus preventing a better overall result. CLOSURE OF RHINE VALLEY ROUTE HINDERS TRAFFIC WITH ITALY VIA SWITZERLAND Unaccompanied Combined Transport between Germany and Italy via Switzerland, which we operate for the most part in conjunction with our Swiss partner HUPAC, was substantially affected by the serious incident near Rastatt. As a consequence, Kombiverkehr was forced to accept a 6.4 per cent drop in shipments to and from Italy via Switzerland to a total of 116,684 consignments in the 2017 financial year. In contrast, the following development is reason to be optimistic: since January 2018 forwarders have been able to take advantage of the opportunity to transport trailers with a corner height of four metres (P400 profile) between Hannover and Novara to and from Italy. The additional new train service via Lötschberg starts initially with three departures a week in each direction

15 KAPITEL / THEMEN INTERMODAL ABSCHNITT SEITENETWORKS NORTHERN EUROPE AND BALTIC STATES Germany s three Baltic Sea ports of Kiel, Lübeck und Rostock form the central hub of Kombiverkehr s services between Germany and the northern European and Baltic states. The numerous ferry connections between these ports and a series of correspondence ports along the Baltic coast make them bundling points for our range of services to and from Scandinavia and to the Baltic states. The Germany-northern Europe corridor has been given additional impetus for growth in recent years by our transport services via the fixed link. UNBROKEN GROWTH TREND IN NORTHERN EUROPEAN TRANSPORT A record result allowed northern European transport to consolidate its position as the second-strongest international business area at Kombiverkehr. With 137,473 consignments, more units than ever before were transported on this axis during the past financial year. Forwarding volumes rose by 4.4 per cent to 274,900 TEU. The pleasing rates of growth over the last three years are mainly attributable to the continuous, needs-driven expansion of intermodal services via both the fixed link and ferries operating out of the German Baltic Sea ports. The pace of growth in the demand for services via the fixed link continues unabated. In 2017 the existing services to and from Sweden were expanded by introducing additional shuttle trains between Coevorden in the Netherlands, Bad Bentheim, Cologne and Herne in Germany, and Malmö in Sweden to cater for market demand. Kombiverkehr also boosted the provision of Baltic Sea transport services, in particular to and from the port of Lübeck. A significant increase in the number of departures on the line to and from Duisburg-Ruhrort Hafen from six to 11 a week in each direction meant that capacity was nearly doubled on this route. Onward transport by ferry from Lübeck-Skandinavienkai also brings the correspondence ports of Malmö and Trelleborg in south Sweden, Helsinki, Kotka and Turku in Finland and Ventspils in Latvia within reach. Trains in the networks operated by Green Cargo and Cargo Net AB in Sweden and Norway respectively serve the Swedish terminal of Årsta (Stockholm) and Alnabru (Oslo) in Norway, among others. As well as the newly introduced service with three departures a week between Rostock and Wuppertal, the number of departures on the route between Lübeck and Ludwigshafen was also increased from five to six. Similarly, Kombiverkehr added another weekly departure in each direction to the existing service on the Kiel Verona route, boosting the number to four. Kombiverkehr currently provides a total of 76 weekly trains in gateway services to and from northern Europe via the German Baltic Sea ports of Kiel, Lübeck and Rostock. VOLUME OF INTERNATIONAL TRANSPORT (INCLUDING BALTIC SEA TRANSPORT) IN CONSIGNMENTS 126, , ,473 91,906 Southern European transport Western European transport Northern European transport & German Baltic Sea ports Eastern and Southeast European transport 26 KAPITEL SERVICES / ABSCHNITT THEMEN SEITE 27

16 INTERMODAL NETWORKS WESTERN EUROPE It was possible to keep the volume of unaccompanied Combined Transport between Germany and the countries of west and southwest Europe more or less constant during the last financial year. The amount of freight transported on the corridors between Germany and France, Spain, Belgium and the Netherlands only fell slightly by 0.6 per cent to 126,350 consignments or around 253,000 TEU. This slight decrease in the volume of consignments can be specifically attributed to a one-off statistical effect. The suspension of a train product in seaport hinterland transport between the Netherlands and Germany in the second half of 2016 meant that the higher base values still had a bearing on the revenue statistics, at least in the first half of If you subtract out this base effect, forwarding volumes in this corridor would have increased significantly. SPANISH TRANSPORT POSTS RECORD RESULT Never before have so many semitrailers, swap bodies and containers been handled in the corridor between Germany and Spain, which we operate together with our Spanish partner Combiberia, as in the past financial year. Volumes rose by 7.7 per cent to 52,961 consignments (105,900 TEU). This more than compensated for the slight drop in consignments from the year 2016, which had been caused by the tragic accident at the BASF plant in Ludwigshafen and the ensuing two-week closure of the terminal. The foundation for this gratifying increase in volumes was economic growth in Spain, which has led to a significant increase in demand for transport, especially in the chemical industry. Services in the region around Barcelona in particular were the biggest drivers of growth, whereas traffic on the Atlantic route via Irun was very badly hit once again by the catastrophic quality of performance on the railways. EXPANSION OF TRANSPORT SERVICES FOR THE WESTERN PORTS A new connection between Duisburg and Moerdijk increased the existing range of services to and from the Netherlands by another three train pairs a week in January Given the high level of demand, the frequency of train services was upped to five departures a week in each direction back in May 2017 and an extra group was added to the train to and from Ludwigshafen. Customers in the forwarding and logistics industry have since had the option of booking available capacity between the Rhine/Neckar region and the Ruhr district on the one hand and the Dutch province of North Brabant on the other. Not only is it possible to drop off and pick up loads by truck at the Moerdijk terminal, but the port also provides access to the ferry services to Great Britain. The traction for the trains is provided by KombiRail Europe, a subsidiary of ours that specialises in the Betuwe line. CENTRAL AND EASTERN EUROPE A total of 91,906 consignments (184,000 TEU) were forwarded in unaccompanied transport services between Germany and central and eastern Europe during the last financial year. There was a drop in volumes of 15.3 per cent on our block trains, which average 72 a week and operate on various national routes. Although conditions in this corridor are still very tough, we nevertheless achieved double-digit rates of growth on some routes. The volume of traffic with Turkey (+28.6 per cent) and between Germany and Slovenia (+12.1 per cent) bucked the general trend. After adjusting our production concept, we were also able to chalk up a volume increase of 3.1 per cent on the services between Germany and Poland. 28 SERVICES 29

17 INTERMODAL NETWORKS TURKISH TRANSPORT VIA TRIESTE STILL IN THE ASCENDANT The volume of transport between Germany and Turkey rose for the fourth time in succession and set a new record in 2017 with 7,127 consignments. Kombiverkehr currently offers a wide range of connections to and from the European and Asian parts of Turkey via the ferry port in Trieste. As well as the Turkish ports of Ambarli, Haydarpasa, Pendik, Mersin and Cesme, it is also possible to reach the port terminal in Alsancak near Izmir. The Trieste facility serves as a central link between the two modes of transport rail and ship. Due to increased demand for services to Turkey, a new block train was introduced between Munich and Trieste in June 2017 with two weekly departures in each direction. The frequency of services was increased from three to four departures a week in each direction on the route between Ludwigshafen and Trieste in October What is more, there are numerous forwarding options from Munich and Ludwigshafen in Kombiverkehr s German and international networks. The various services can also be used to transport hazardous goods or refrigerated trailers with a self-sufficient energy supply over the long distance to Turkey safely and efficiently. POSITIVE IMPETUS THROUGH NEW PRODUCTION CONCEPT IN POLISH TRANSPORT The encouraging growth in volumes in the transport corridor between the Ruhr district and Poland is attributable to closer cooperation between Kombiverkehr and its partner HUPAC. As a result, forwarding volumes for Poland rose for the third time in succession. The basis of this success is a joint train product which has been running three times a week in each direction between the Duisburg DUSS terminal and Pruszkow since January 2017, stopping off in Gadki. This joint product allows the participating partners to provide a competitive and reliable service between the Ruhr district and the industrial centres around Poznan and Warsaw. The late closing times for acceptance in Duisburg and the early collection times in Pruszkow enable customers to optimise vehicle operations in these regions. There are also options for onward transport from Duisburg and Pruszkow to make use of the two operators existing national and international services. Bundling the consignment volumes of both operators into one joint train product opens up opportunities for customers in international forwarding to send shipments by rail, which is both cost-efficient and climate-friendly, in this corridor. All types of transport units can be shipped, including semitrailers with a profile of up to P400. VOLUME BY COUNTRY IN CONSIGNMENTS Austria Belgium Czech Republic, Slovakia Denmark Finland France Greece Hungary Italy Netherlands Norway Jan. Dec Jan. Dec Difference in % 39,471 45, % 7,431 7, % 18,692 26, % 4,179 3, % % 10,192 9, % 1,134 1, % 11,212 16, % 381, , % 55,767 60, % 1, % Poland 11,725 11, % Slovenia, Croatia 2,545 2, % Spain, Portugal 52,960 49, % Sweden 48,839 47, % Switzerland 13,505 15, % Turkey 7,127 5, % 30 SERVICES 31

18 INTERMODAL LOGISTICS MANAGEMENT EUROPE-WIDE ONE STEP AHEAD For many years Kombiverkehr has been committed to promoting related areas of business alongside its core activities, such as wagon development and equity interests. In 2017, among other things, the logistics service provider played a significant role in the creation and formulation of the new EN European standard, the planning and construction of the new Südwestfalen Container Terminal and the launch of the KV 4.0 digitalisation project. 32 INTERMODAL LOGISTICS MANAGEMENT 33

19 INTERMODAL LOGISTICS MANAGEMENT UIRR: THE MOUTHPIECE OF THE CT SECTOR IN BRUSSELS OPERATIONS Kombiverkehr is a founding member of the UIRR, the International Union of Combined Road-Rail Transport Companies. As a mouthpiece for the industry in Brussels, the UIRR essentially concentrates on three central issues in the sector: 1. The development of carrier-neutral frameworks 2. The strengthening and promotion of road-rail combined transport 3. The quality of rail freight transport Last year the UIRR made intensive efforts to provide advice and support for the European Commission during preparations to amend CT Directive 92/106. A proposal was submitted by the Commission on 8 November In spite of a few reservations, the intermodal sector welcomed the submission. Having spent three years analysing the facts, the EU Commission has focused on the problems identified in the course of the impact assessment. The revised directive should now compensate for the disadvantages still being suffered by the CT sector compared with other modes of transport. At the same time, the UIRR made an essential contribution to the finalisation of Implementing Regulation 2017/2177 on access to service facilities. The regulation comes under the Directive 2012/34 establishing a single European railway area and basically defines general terms and conditions of business for the freight terminals as a category of the service facilities. The new regulations will help to improve productivity at the terminals and should make them easier to use for the operators of Combined Transport. In addition to this, the union has been closely tracking EU initiatives to draw up a new legislative framework for road transport (mobility packages). This covers road tolls and regulations for the internalisation of external costs (Eurovignette Directive) and, above all, labour law provisions aimed at protecting professional drivers, among other things. Considerable changes are expected here if the aim of a truly carrier-neutral legislative framework is to be achieved for freight transport in Europe. Five new members joined the union in 2017, including Baltic Rail, the first UIRR member from Estonia. At present the UIRR is actively involved in five European projects on behalf of the sector: Hub- Harmony (key performance indicators in the terminals), OptiYard (development of IT systems for the more efficient operation of marshalling yards), AEROFLEX (CT-compatible aerodynamic aids for commercial road vehicles) and ELETA (reliable forecast of estimated time of arrival of goods trains). The ELETA project is directly linked to the aims set out in the sector s statement on rail freight transport corridors. The development of the RailFreightLocations.eu portal is also continuing and best-practice recommendations are drawn up in the UIRR working groups together with the members. An intermodal task force has been set up at the European Railway Agency at the suggestion of the UIRR. The agency plays a decisive role in the Fourth Railway Package. An important aim here is to guarantee compatibility between the intermodal transport unit, the rail wagon and the clearance profile. And out of the chaos, a voice spoke to me: Smile and be happy, for it can always be worse! And I smiled, and I was happy, and it did get worse Sadly, although not meant to be taken seriously, this piece of wisdom was in many respects a bitter reality for the Combined Transport sector during the past financial year. Some things were worse than we could or would ever have imagined. Levels of punctuality in 2016 were already unsatisfactory, but they were nowhere near as low as those reached in We have explained the reasons for this in detail. The spring and autumn storms had names like Paul, Xavier and Herwart and they paralysed rail traffic in Germany to a greater or lesser extent. It took several days to restore the railway infrastructure. The performance of our service providers was adversely affected both by a shortage of resources, especially drivers, and by organisational changes to the operation of individual train products. The confidence of customers in an efficient intermodal logistics chain was badly shaken by accidents at trouble spots, engineering works and, last but not least, Rastatt and its huge impact on rail freight transport in Europe. The numerous problems meant that we were in many cases unable to provide the transport capacity required by our customers. This caused congestion in some terminals at times and exacerbated the situation for our customers. Lessons learnt? We hope that the infrastructure operators heard the outcry from those affected after Rastatt and actually make sure that such events never happen again. We have noted that our partner DB Cargo wishes to invest heavily in measures to improve quality, with a particular emphasis on additional reserves in terms of locomotives, train drivers and wagon fleets in order to lessen the vulnerability of the system. We have also learnt that we need to improve our information management and control the capacity of our trains in a way that facilitates planning for our customers. Suitable measures are being introduced and some have already been implemented. Nevertheless, there remains much to do to rebuild trust. Kombiverkehr will pay the usual careful attention to how rail and terminal partners meet the demands of the market and will intervene in a decisive manner if any undesirable developments come to light. 34 INTERMODAL LOGISTICS MANAGEMENT 35

20 KAPITEL / INTERMODAL ABSCHNITT LOGISTICS MANAGEMENT PRIVATE TRACTION WAGONS TERMINALS In 2017, KombiRail Europe B. V. the rail freight company belonging to Kombiverkehr pulled 1,968 trains. Tried and tested services were provided between the Rotterdam RSC, Euromax and Delta terminals as well as the terminals at the new Maasvlakte APMT 2 and RWG on the one hand, and Duisburg, Dortmund and Neuss on the other. After Kombiverkehr had integrated the Dutch terminal of Moerdijk into the international network in January 2017, KombiRail took over responsibility for providing the traction between this port and Duisburg-Ruhrort Hafen. This service was extended to and from Ludwigshafen in May The year 2017 was also characterised by many diversions due to work to upgrade the line between Oberhausen and Emmerich. This infrastructure scheme will last for several more years and affect the whole corridor. In spite of these many drawbacks, KombiRail also made a tangible contribution to linking the Port of Rotterdam with the hinterland by rail during the past financial year. The transport output of KombiRail amounted to around 300 million tonne-kilometres in 2017 with a volume of around 60,000 consignments. The number of wagons owned by Kombiverkehr still stands at 262 and includes double pocket wagons as well as 104 and 73 container carriers. The total distance covered in 2017 amounted to 32 million kilometres. This equates to an average 122,300 kilometres covered by each wagon. The total stock of modern pocket wagons in Europe which have a large envelope and are also suitable for megatrailers now provide enough spaces for around 8,950 trailers. In reality, therefore, this envelope is the new standard. This development is also factored into the EN European standard. Kombiverkehr has advocated this new standard in the standardisation bodies in order to increase certainty in planning when purchasing cranable semitrailers. It defines the largest possible envelope for semitrailers, important dimensions, pieces of equipment and technical specifications. The industry has thus succeeded in substantially improving and simplifying semitrailer on pocket wagon technology in recent years in terms of wagon technology, cargo handling systems and, above all, trailer technology. Combined Transport transshipment terminals play a key role within the transport chain by linking different carriers. Alongside their basic function of lifting and lowering, modern-day terminals compete as flexible and multifunctional service providers on a daily basis. We note once again that terminals in major economic centres have virtually no spare train capacities at present. Even switching to the few available night-time slots is a limited option due to a lack of storage capacity. The trend towards the use of large-volume means of transport such as semitrailers and 45-foot swap bodies has been foreseeable for a long time, but it is evident that this has not been sufficiently taken into account in the planning of transshipment facilities. We therefore consider a further expansion of existing terminal infrastructures to be absolutely essential in the short and medium term. If the opportunities to increase the capacities of existing terminals have been exhausted, then new facilities must be built in order to meet the continuing high demand. This will be the logical outcome in future, particularly in leading economic regions, if we wish to meet the demand for intermodal transport solutions, which remains high and is set to rise in future. Kombiverkehr therefore continues to be involved in the conceptual design and operation of CT terminals. The goal remains the same: to create customer-centred, needs-based services. The priority here is on fast, optimised workflows based on intelligent information and data exchange processes. On the whole, the past financial year was a successful one for the terminal companies in which Kombiverkehr has a stake. The upward trend was maintained. Deutsche Umschlaggesellschaft Schiene-Straße (DUSS) mbh handled 2.2 million transport units during the past financial year. DUSS operates 23 national terminals, with München-Riem, Köln-Eifeltor, Hamburg-Billwerder and Duisburg-Ruhrort Hafen among the busiest facilities in With a 12.5 per cent holding in DUSS, Kombiverkehr accounted for almost half of the total handling volume with a share of 45 per cent. Kombiverkehr thus plays a significant part in the company s economic success. 36 KAPITEL INTERMODAL / ABSCHNITT LOGISTICS MANAGEMENT 37

21 INTERMODAL LOGISTICS MANAGEMENT The Duisburg-Ruhrort Hafen terminal, which is owned by Planungsgesellschaft Kombinierter Verkehr (PKV) acts as a central hub in the national and international train network for Kombiverkehr. With over 200,000 transport units, the terminal again managed to increase the volume of cargo handled despite generally difficult conditions. Neuss Trimodal GmbH managed to record substantial gains in the 2017 financial year compared with the preceding year, with 179,000 units transhipped (110,163 of them by rail). The additional handling capacity available after expansion led to a significant increase, primarily in the transshipment of waterborne freight. It was thus possible to achieve a 37 per cent volume increase compared with the previous year. The most attractive aspect of the facility in the Port of Neuss is the comparatively high level of storage capacity. The company also scores top points for its focus on good service. This has made a major expansion into additional areas of business such as depot services possible at the facility, which is operated by a partnership comprising Neuss-Düsseldorfer Häfen, Ambrogio and Kombiverkehr. Kombi-Terminal Ludwigshafen (KTL) was able to consolidate its status as Germany s busiest inland terminal in the past financial year. In 2017 more than 362,000 semitrailers, swap bodies and containers were handled by the facility, which is jointly operated by BASF SE, Kombiverkehr and other partners. With a share of 40 per cent in the total handling volume, Kombiverkehr is still the largest operator at the Ludwigshafen CT site. With over 175,000 transport units handled, TriCon Container-Terminal Nürnberg GmbH managed to improve slightly on the previous year s result. This confirms yet again that the facility, in which Kombiverkehr has a 25 per cent equity stake, is of central importance for maritime and continental customers owing to its strategically advantageous location in the Hafen Nürnberg-Roth freight village. The Bremen site was impressive in demonstrating its role as a bundling point for continental and maritime consignment flows during the year under report The terminal, which is operated by Roland Umschlagsgesellschaft mbh & Co. KG in the Bremen freight village, chalked up nearly 90,000 units, a considerable volume increase of over 40 per cent compared with the previous year. Deutsche Bahn AG, Kombiverkehr and several forwarders have a stake in the company. Eurokombi Terminal GmbH was not able to match the record result from the preceding year but still managed to achieve another positive result with over 410,000 transport units. Operated in cooperation with Eurogate Container Terminal Hamburg GmbH, the transshipment facility in Hamburg Waltershof has been integral to the planning of continental transport volumes for Kombiverkehr since the abolition of the free-port borders Our holdings in the Baltic Sea terminals are of central importance for traffic with Scandinavia and the Baltic region. Optimally coordinated handling processes provide for smooth transfer operations between rail and ship in Rostock, Lübeck and Kiel. There was tangible growth in intermodal traffic at the Rostock site during the period under review. Rostock Trimodal GmbH thus succeeded in chalking up another substantial volume increase. With over 80,000 transport units transshipped, the company achieved the best result in its history. Consignments carried to and from Rostock on Kombiverkehr trains accounted for 60 per cent of the total volume here. This underlines the continuing important role of the facility in the company s entire network of services across the Baltic Sea. KombiPort Kiel GmbH operates transshipment facilities at Kiel Ostuferhafen and Schwedenkai. For Kombiverkehr, both sites represent a vital hub not only for traffic with Scandinavia, but also the Baltic region and Russia. The company increased the volume of cargo handled in 2017 to a total of 32,200 transport units. With growth of 10 per cent, the upward trend of preceding years was maintained. TRANSPORT UNITS HANDLED AT TERMINALS IN WHICH KOMBIVERKEHR HAS HOLDINGS Bremen-Roland DUSS Total Hamburg Eurokombi Kiel Lübeck-Skandinavienkai Ludwigshafen KTL Neuss Trimodal * Nürnberg Hafen TriCon Rostock-Seehafen * rail consignments only Units 2017 Units ,575 63,438 2,152,985 2,157, , ,595 32,169 29,363 88,245 74, , , , , , ,807 80,281 76, INTERMODAL LOGISTICS MANAGEMENT 39

22 INTERMODALES LOGISTIKMANAGEMENT INFORMATION MANAGEMENT Baltic Rail Gate GmbH recorded growth of nearly 20 per cent during the period under review. Kombiverkehr accounted for half of the 88,300 transport units transshipped in 2017, thus reaffirming that the port is an attractive business site. The terminal is operated by Kombiverkehr in conjunction with Lübecker Hafen-Gesellschaft mbh in Lübeck, the largest of Germany s Baltic Sea ports, and remains the most important transshipment centre in Kombiverkehr s transport network for the Baltic Sea and Scandinavia. It was not possible to adhere to the scheduled start of construction for the fast transshipment facility on the premises of the old marshalling yard in Hannover-Lehrte in the 2017 financial year. A test run prior to its official launch is now scheduled for The terminal, which has six 700-metre platforms, two gantry cranes and a fully automated sorting facility, provides excellent conditions for the development of marketable intermodal services between locations that do not handle sufficient volumes for block trains. MegaHub Lehrte GmbH, the company set up to run the cargo handling facility, was still not operational in the last financial year. Situated directly at the heart of Germany s third-strongest economic region, the Kreuztal terminal facility covers an area of around 18,500 square metres and has two 225-metre transshipment platforms and a 190-metre holding track. Its function is to provide an efficient infrastructure for road-rail Combined Transport. With mobile handling equipment working round the clock seven days a week, the facility is capable of handling up to 45,000 transport units annually. Südwestfalen Container-Terminal GmbH in which Kombiverkehr and Kreisbahn Siegen-Wittgenstein (KSW) have equal shares is scheduled to commence operations in the fourth quarter of As well as intermodal services to German and international ports, national CT services will also facilitate efficient transport concepts for businesses in the North Rhine-Westphalia, Hesse and Rhineland-Palatinate triangle. SUCCESSFUL LAUNCH OF KV 4.0 DIGITALISATION PROJECT Network partners Kombiverkehr, DB Cargo, Lokomotion, SBB Cargo Deutschland, KTL Kombi-Terminal Ludwigshafen, Hupac Transport, Hoyer, Paneuropa Transport, Hupac Intermodal, Bertschi and Hupac SpA have been working hard since September 2017 to implement the joint project Digitalisation of intermodal supply chains KV 4.0. The overarching aim of the scheme is to make the logistical process more transparent and manageable all the way along the intermodal transport chain and beyond national borders. All parties will have direct access to the relevant parameters of Combined Transport (e.g. order and timetable information, estimated times of arrival and shipping information) by using a newly developed shared data hub as well as standardised interfaces. All project partners in the logistics industry are working collectively on the specification of the data hub, the definition of the interface and any necessary adjustments to business processes. The project provides for the programming to be carried out by software suppliers who are to be duly selected and commissioned. This will make a major contribution to enhancing the competitiveness of intermodal supply chains. Quite apart from the physical interfaces (terminals), the large number of stakeholders and the diverse transnational requirements in the rail transport sector, the absence of a continuous information chain also prevents eco-friendly rail freight transport from being seen as an attractive option. Whereas it is standard practice to give estimated times of arrival in the road haulage industry, data for the calculation of overall punctuality is not available in the rail transport sector. This means that any deviations from timetable can only be communicated later, usually a short time before the actual arrival of the train. End customers need better proactive information delivery, however. The project is sponsored by the Federal Ministry of Transport and Digital Infrastructure within the framework of the Modernity Fund research initiative (mfund). LESS PAPER, BUT NOT PAPERLESS After a conception phase in 2016, Kombiverkehr decided at the beginning of 2017 to bring in an enterprise content management system. The product of choice was DOXIS4 by SER, a system with excellent references which is certified in accordance with auditing standard 880 of the Institute of Public Auditors in Germany (Institut der Wirtschaftsprüfer) and complies with the EU General Data Protection Regulation. Apart from ensuring compliance with the principles for properly maintaining and storing books, records and documents in electronic form and for data access (GoBD), and safeguarding data privacy for this corporate platform, Kombiverkehr also intends to map all essential business processes and all documents subject to the duty of rendering account. This is an agile project. Processes are analysed step by step by teams from the relevant departments before being simplified wherever possible and mapped as workflows in DOXIS4. The strategy here is less paper rather than paperless at any price. Added value takes priority and it must be achieved by mapping in the enterprise content management system. The first milestone was reached on 1 January 2018 with the go-live for electronic invoice processing. The introduction of digital claims management and electronic business partner and contract files are planned for the current year. 40 INTERMODAL LOGISTICS MANAGEMENT 41

23 PERSONNEL COMMITTED AND FIT FOR A DIGITAL FUTURE Numerous challenges meant that the 2017 financial year placed exceptional demands on the employees of Kombiverkehr. The planning and implementation of internal digitalisation projects should make the operator's work easier in future and hence even more efficient. 42 PERSONNEL 43

24 PERSONNEL PERSONNEL DEVELOPMENT Looking back over the period under report, it becomes evident just how worthwhile the effort and dedication of all Kombiverkehr s staff have been over the past year. In virtually no other year in the company s history has more stood in the way of convincing existing and prospective customers of the efficiency of our services. What was already a tough situation with regard to quality of performance due to a lack of resources was exacerbated by, for instance, refugee controls, Rastatt and environmental factors in a way that pushed all our teams of staff to their limits. It became clear that a disruption to operations runs through the central business process like a common thread and often ends up in the department dealing with customer claims due to storage charges. The notion that a good business process always lies behind a successfully completed order and a satisfied customer was reflected in our project work and in our intention to achieve leaner processes. And this is precisely where Kombiverkehr s digitalisation strategy makes a good contribution: only with deeper IT integration is it possible to meet the demands of partners and customers for definite information and fast responses. Our wide-ranging digital strategies are making Kombiverkehr fit for the future. They include the migration of our IT systems, the introduction of enterprise content management and digital applicant management in respect of the GDPR, the upgrade of the mykombiverkehr portal and the KV 4.0 digitalisation project. New ideas and commitment are required. Kombiverkehr employed 132 full-time equivalent staff in the 2017 financial year. Three apprentices have joined the workforce since the new training programme was brought in last year and two employees are being retrained. Ten additional positions need to be filled to deal with the challenges that lie ahead of us in the coming year. Our thanks go to all our employees who, by dint of their hard work and commitment, have made a substantial contribution to managing what has been a challenging situation for Kombiverkehr. SUCCESSFUL START FOR NEW RECRUITS IN INTERMODAL- LOGISTICS Apprenticeships start at Kombiverkehr: Since August 2017, Kombiverkehr has offered young people the opportunity to train for a career as a management assistant in forwarding and logistics. In the last financial year, the company was delighted to welcome three trainees who were recruited with the help of the new apprenticeship campaign as well as two employees who are being retrained. Interested parties will find useful information on training at Kombiverkehr on the web page and a Facebook page and can apply for jobs directly online. The company has also appeared at regional apprenticeship fairs with its own information stand. 44 PERSONNEL 45

25 ORGANISATION CHART GENERAL MANAGEMENT Kombiverkehr decided to offer a training programme in response to the current situation in the labour market, the shortage of skilled workers and the difficulty in recruiting staff who are specialised in the business field of Combined Transport. The idea is for new recruits trained by Kombiverkehr to fill vacant positions in the company in future. During the first few months of their training the new recruits visited and assisted in numerous departments: from Sales and Transport Management to Billing and Invoice Verification or Corporate Communications. The apprentices learn how to prepare for exams and attend internal and external classes and advanced courses in order to gain their final qualifications. They have also done a work placement with Spedition Bolloré, a partner company at Frankfurt Airport, in order to gain an understanding of other modes of transport. The search for motivated, committed apprentices to commence training in 2018 has already begun. LOGISTICS CONCEPTS OPERATIONS Billing & Invoice Verification Hazardous Goods & Waste Transports ROC Shipping/Customs & Safety Terminals, Process Organisation & Projects Transport Management Transport Monitoring MARKETING Project development SALES National Northern Europe & German Baltic sea ports Eastern & Southeastern Europe Southern Europe Western Europe Regional Sales Management/ Area Management Sales Management FINANCE & ADMINISTRATION Controlling Finance & Accounting Human Resources Service Department CORPORATE COMMUNICATIONS & SALES SUPPORT INFORMATION TECHNOLOGY Commercial Systems Production Systems System Administrators EQUIPMENT TECHNOLOGIES CLAIMS MANAGEMENT & TRANSPORT LAW 46 47

26 ANNUAL FINANCIAL STATEMENTS BALANCE SHEET, PROFIT AND LOSS ACCOUNT In the last financial year Kombiverkehr posted sales revenues of EUR million from transporting 958,299 consignments. The net income for the year rose to EUR 977, ANNUAL FINANCIAL STATEMENTS 49

27 BALANCE SHEET INCOME STATEMENT ASSETS on 31 December 2017 EUR EUR A. Fixed assets I. Intangible assets 169, , II. Tangible fixed assets 6,328, ,065, III. Long-term financial assets 2,825, ,725, ,324, ,991, B. Current assets I. Inventories 1,188, , II. Accounts receivable and other assets 35,385, ,225, III. Cash on hand, bank balances 18,488, ,959, ,062, ,421, C. Prepaid expenses 83, , ,470, ,488, LIABILITIES on 31 December 2017 A. Equity I. Capital shares 7,333, ,333, II. Reserves 10,215, ,899, III. Net income 977, , ,525, ,903, B. Balancing item for capitalized treasury shares 60, , INCOME STATEMENT January to 31 December 2017 EUR EUR 1 Sales revenues 447,471, ,203, Increase in work in progress 917, Other operating income 3,551, ,693, ,940, ,897, Cost of materials 431,558, ,286, Personnel expenses 10,354, ,956, Depreciation, amortisation and write-downs 1,029, ,161, Other operating expenses 8,676, ,391, ,619, ,796, Operating result 321, , Income from long-term equity investments 875, , Income from long-term loans 4, , Interest and similar income 2, Interest and similar expenses 52, , Financial result 830, , Taxes on income 169, , Earnings after tax 981, , Other taxes 4, , Net profit for the year 977, , C. Provisions I. Provisions for pensions and similar obligations 60, , II. Provisions for taxation , III. Other provisions 14,455, ,528, ,516, ,678, D. Liabilities I. Liabilities to banks 2,750, ,250, II. Accounts payable 26,366, ,828, III. Other liabilities 2,252,326,81 1,768, ,368, ,846, ,470, ,488, ANNUAL FINANCIAL STATEMENTS 51

28 AUDIT CERTIFICATE The balance sheet to 31 December 2017 and the income statement for the 2017 financial year are reproduced only in abbreviated form on the above pages. The auditors KPMG AG have issued an unqualified audit certificate for the annual financial statements to 31 December 2017 and the management report for the 2017 financial year. It is worded as follows: Audit certificate We have audited the annual financial statements comprising the balance sheet, income statement and notes including the accounting system and the management report of Kombiverkehr Deutsche Gesellschaft für kombinierten Güterverkehr mbh & Co. KG, Frankfurt am Main, for the financial year from 1 January to 31 December The accounting system and preparation of the annual financial statements and annual report in compliance with German commercial law and the supplementary provisions of the articles of association are the responsibility of the statutory representatives of the company. It is our task to offer an assessment of the annual financial statements including the accounting system and the management report on the basis of our audit operations. We performed our audit of the annual financial statements in compliance with 317 HGB [German Commercial Code] and in accordance with the principles of proper auditing issued by the German Institut der Wirtschaftsprüfer (IDW). These state that the audit is to be planned and performed in such a way that irregularities and infringements having a substantive effect on the presentation of the net worth, financial position and income situation in the annual financial statements in compliance with the principles of proper accounting and in the annual report are identified with sufficient certainty. The audit operations are determined on the basis of knowledge of the business activities and the economic and legal position of the company and the expectations of possible errors. During the audit the effectiveness of the internal control system relating to the presentation of accounts and evidence for the disclosures in the accounting system, annual financial statements and management report are assessed largely on the basis of random samples. The audit comprises an assessment of the reporting principles applied and of the substantive appraisals of the statutory representatives and an evaluation of the overall presentation of the annual financial statements and management report. It is our opinion that our audit forms a sufficiently reliable basis for our assessment. Our audit did not give rise to any concerns. According to our assessment based on the findings obtained in the audit, the annual financial statements conform to statutory requirements and the supplementary provisions of the articles of association and provide a true and fair view of the net worth, financial position and income situation of the company in compliance with the principles of proper accounting. The management report is consistent with the annual financial statement, complies with statutory regulations, provides a fair overall view of the position of the company and adequately presents the risks and opportunities of future developments. Mainz, 14 May 2018 KPMG AG Wirtschaftsprüfungsgesellschaft 52 ANNUAL FINANCIAL STATEMENTS 53

29 APPENDIX WORKING GROUPS, ADMINISTRATIVE BOARD, ADVISORY BOARD AND EQUITY INTERESTS Kombiverkehr has many years of experience in consulting and cooperation with successful representatives from the forwarding and logistics industries and plays an active role in equity interests in intermodal transport. 54 APPENDIX 55