Always on the move ANNUAL REPORT 2016 ÖBB-HOLDING AG January February March 4/22 Still on track to success 2015 marked the fifth consecutive year of profit growth at ÖBB. Its earnings (EBT) of 192.8 million euros in 2015 constituted the best result ever achieved in the history of the company. Rail passengers increased by 3 million. 5/07 ÖBB’s CEO be- comes Chancellor 1/17 of Austria By rail to the ski jump Despite the checkered 180-year history of ÖBB, this is the first time Over the three-day event, ÖBB provided convenient and stress-free rail ever that its leading train driver has transport for thousands of the 60,000 or so visitors to the World Ski taken over the wheel at the federal Jumping Championship in Kulm. ÖBB demonstrated its presence with chancellery: On this day, ÖBB’s eye-catching advertising on both the jump and at the finishing line. CEO Christian Kern was sworn in as Federal Chancellor of the Republic of Austria. 3/9 Project launch Training Center ÖBB plans to bundle all its rail- way-specific training programs in St. Pölten in future. A learning campus with seminar rooms, signaling system for training purposes, model systems, and simulators are being built here, together with a new ap- prentice hostel. Innovative training opportunities will then be available – for employees of both ÖBB and other railway operators. 4/11 New ideas platform launched ÖBB’s Open Innovation Lab has opened its doors at head office. The intra-Group platform bundles all the 1,500 or so valuable ideas and 5/24 initiatives that emerge within the Group each year. A creative work Andreas Matthä appointed new CEO approach goes without saying here. ÖBB’s Supervisory Board was very quick to decide who will steer ÖBB in the future: Andreas Matthä, formerly member of the Board of Manage- ment responsible for Infrastructure for many years, was initially appoint- ed interim CEO of ÖBB and subsequently confirmed by the Supervisory Board meeting on July 4. April May June A look back 6/10 International Safety Day at 2016 BMVIT, ÖBB, KfV and ÖAMTC joined forces to present a video explaining the correct behavior at railway cross- ings. The new Infra safety campaign A new training center, for youngsters aims to raise their YEAR IN REVIEW. awareness for hazardous situations. a new CEO, the biggest expansion of our products and services in 30 years, and a new central freight station. 5/31 Gratifyingly good levels of customer satisfaction The most recent customer satisfac- tion survey confirms that customers are appreciative of ÖBB’s quality and service. Good scores were again awarded for punctuality, cleanliness and safety, and the staff scored top marks yet again for their compe- tence and friendliness. 6/8 Surf the internet at 230 km/h! Thanks to the biggest digitaliza- tion campaign in the history of the company, uninterrupted WiFi is now possible while traveling at 230 km/h on a Railjet, complete with onboard 6/14 entertainment via the portal contain- ing information and ORF-TVthek. 450 million euros for Vienna’s metro Between now and 2025, BMVIT and the city of Vienna plan to invest around 450 million euros, mainly to expand the metro, with focus on the connections between Meidling and Hütteldorf and the Marchegg branch. 6/18 Vienna’s central marshalling yard celebrates its 30th anniversary In future, ÖBB plans to bundle Open Day at “ZVB Kledering.” This all its railway-specific training is where freight trains are split up and regrouped, while the freight it- programs in St. Pölten at a learn- self is turned over in the new South Vienna Freight Terminal. ing campus with seminar rooms, signaling system for training purposes, model systems, and simulators ... July August September 7/6 The “ÖBB” brand ranks 5th The “ÖBB” brand has been continuously increasing in value over the past five years and is currently worth 1.88 billion euros, according to the 8/24 European Brand Institute. As such ÖBB ranks fifth among a total of 500 Austrian companies. VCÖ railway test reveals trend toward taking the train There are already a lot of people who prefer to take the train rather than drive, although frequently the car could also be an option. For many passengers, an improved portfolio of rail products and services (68%) and shorter travel times (71%) are the key deciding factors. 7/11 9/10 ÖBB wants ÖBB at “Open to become a House Vienna” top employer 800 (!) people took advantage of According to the Employer Brand the opportunity to have a look at Study, ÖBB currently ranks a good the Service Design Center, a model 14th out of 37 surveyed compa- open-plan office, and the Skylobby nies in Austria. Our aim is to rank on the 23rd floor of head office. among the top ten employers by 2020. 7/14 9/23 Hallo Hellö Con struction of On this day, ÖBB commenced its the last Koralm- long-distance bus service under the bahn tunnels “Hellö” brand with eleven inter- Following the festive start of tunnel national connections. On the first construction, building work on the weekend of operation, some of the Stein and Lind tunnels commenced services on the Vienna to Venice on this day and is scheduled for route were virtually booked out. completion in 2022. All ten tunnels of the Koralmbahn, which extends for some 130 kilometers in length, are therefore now either under construction or in partial operation. October November December 10/20 12/11 InfoRail Upper Austria gets goes on tour a metro as well The InfoRail exhibition touring Five new metro lines commenced throughout Austria offers fasci- operation in Upper Austria, four nating insight into the numerous of which are operated by ÖBB. projects along the Southern line, The 500,000 or so people living in together with stories about the Austria’s second-largest conurba- people working on it. tion in and around Linz now have a viable alternative to automobile transportation. 10/17 40,000 questionnaires to employees “Tell us what you think” was again the topic of the day as we launched what was now our third Austria- wide ÖBB employee survey, which ran until November 4. More than half the workforce took part in the survey (see page 42). 11/23 PR State Prize for Humanity ÖBB has won the Austrian PR State Prize yet again, this time for its “Humanity takes the train” project as part of its crisis communication during the refugee crisis. 12/11 Night train becomes ÖBB Nightjet Additional night train connections coupled with first-rate service: Over the coming three years, ÖBB hopes to welcome around 1.8 million more passengers on board its new Nightjet service. 12/11 12/13 New timetable: Opening of the 2.2 million South Vienna more passenger Freight Terminal kilometers ÖBB-Infrastruktur has built a The new timetable constituted the state-of-the-art freight terminal According to VCÖ, ever more biggest expansion of our services on a site measuring 55 hectares. in 30 years. Better connections The terminal for combined freight people already prefer trains to for passengers are now available, transport will vastly simplify road/ especially in and around the rail turnover and, in doing so, cars. For many passengers, an conurbations in Tyrol, Carinthia hopefully result in even more and Styria, and thanks to the new goods being transported by improved portfolio of rail p roducts metro lines in Upper Austria. eco-friendly rail. and services is one of the key deciding factors. Key Performance Indicators Earnings ratios (IFRS) (million euros, rounded) 2016 2015 2014 2013 2012 Revenue 5,247 5,221 5,270 5,239 5,221 Total income 6,416 6,345 6,355 6,248 6,216 Cost of materials and purchased services -1,730 -1,751 -1,764 -1,793 -1,929 Personnel expenses -2,478 -2,337 -2,407 -2,341 -2,358 Other operating expenses -428 -451 -460 -530 -478 EBITDA 1,779 1,806 1,723 1,584 1,451 Depreciation & amortization (incl. impairment) -968 -949 -859 -829 -750 EBIT 811 857 864 755 701 Financial result -645 -664 -692 -652 -626 EBT 166 193 172 103 75 ROCE (%) 3.4 3.7 3.9 3.6 3.5 Balance sheet ratios (IFRS) (million euros, rounded) Balance sheet total 27,344 26,475 25,746 24,631 24,084 Non-current assets 25,877 25,140 24,334 23,322 22,446 of which property, plant and equipment 24,386 23,416 22,724 21,765 20,749 Current assets 1,467 1,335 1,411 1,310 1,638 Equity 2,093 1,922 1,692 1,589 1,431 Equity ratio (%) 7.7 7.3 6.6 6.5 5.9 Financial liabilities 22,799 22,317 21,811 20,778 20,177 Net debt 22,108 21,306 20,839 20,024 18,369 Gross capital expenditure 2,400 2,032 2,057 2,170 2,248 Net debt/EBITDA (ratio) 12.4 11.8 12.1 12.6 12.7 Net gearing (ratio) 10.6 11.1 12.3 12.6 12.8 Contents STATEMENT OF THE BOARD OF MANAGEMENT 3 CONSOLIDATED FINANCIAL STATEMENTS 108 Consolidated Income Statement 2016 108 STATEMENT OF THE CHAIRWOMAN Consolidated Statement of Cash Flow 2016 109 OF THE SUPERVISORY BOARD 6 Consolidated Statement of Financial Position as of December 31, 2016 110 Consolidated Statement of Cash Flow 2016 111 ALWAYS ON THE MOVE 10 Consolidated Statement of Changes in Shareholders’ Equity 2016 112 CORPORATE GOVERNANCE REPORT 52 NOTES ON THE CONSOLIDATED FINANCIAL CONSOLIDATED MANAGEMENT REPORT 60 STATEMENTS AS OF DECEMBER 31, 2016 113 A. Group Structure and Investments 60 A. Basis and Methods 113 B. General Conditions and Market Environment 62 B. Notes on the Consolidated Statement of Financial C. Economic Report and Outlook 70 Position and the Consolidated Income Statement 131 D. Non-Financial Performance Indicators 92 C. Other Notes to the Consolidated Financial Statements 156 E. Opportunities / Risk Report 100 F. Notes on the Management Report 105 AUDITORS’ REPORT 194 GLOSSARY OF TERMS 198 DIGITAL. German and english PDF versions of the Annual Report for 2016 and two related videos can be found at: konzern.oebb.at/gb2016 ONE YEAR, ONE IMAGE. We have made a graphic recording of our year 2016. The result is a kind of mindmap of our last year and at the same time a look into the future – all in one illustration. The entire image can be found on the back of the cover. Excerpts from this follow in the image part and in the pages separating the chapters 3 ANNUAL REPORT 2016. STATEMENT OF THE BOARD OF MANAGEMENT nt ed d of Managempervisory Boar oarSu B e ov m e h n t o ays w Al e nc BOARD OF MANAGEMENT OF ÖBB-HOLDING AG. Mag. Josef Halbmayr MBA (CFO), Ing. Mag. (FH) Andreas Matthä (CEO) na er ov e G at or p or C Moving Austria. Last year was difficult for us, but it was also ultimately another spurecscseusrsefu ol nfi nmaanrcgiainl sy e–a pr.u Tt hper esstsilul rwe eoank eonuirn gfr eeicgohnt otmrayn s–p oinr ta ddidviitsiioonn tion tphaer teicnuolarmr. oTuhse dated nt Report bus business and passenger rail transport faced tough competition and a major increase Consolinageme in spending on safety. Despite these conditions, the ÖBB Group achieved the third-best Ma result in its history with an EBT of EUR 166.2 million in 2016 and looks with pride on al its new passenger record in passenger rail transport. nci With stable total group sales of almost EUR 5.3 billion, all sub-groups again made a positive contribution olidated Fina Statements in 2016 and thus made their necessary contribution to comprehensive income. The performance of the ns o C Rail Cargo Group was particularly gratifying; while the results lagged behind those of 2015, they were again clearly positive with an EBT of EUR 44.3 million, despite the difficult market environment. And this was achieved in spite of low diesel prices and low road tolls, while rail freight companies pay more and more for energy and the use of routes. More passengers than ever More than 244 million customers – more passengers than ever before – used ÖBB's trains in the past year. The most significant increase was once again recorded in local passenger transport, with an increase of more than five million passengers compared to the previous year. Long-distance transport increased by 0.9 million passengers. Overall, passenger rail transport thus grew by three percent in a year – in the past ten years, the number of passengers in ÖBB's local and long-distance trains has risen by almost 60 million. 4 Board of Management & Supervisory Board | Always on the move | Corporate Governance | Consolidated Management Report | Consolidated Financial Statements In 2016 – as in the previous years – there was a We are maintaining the slight decline in passengers in the ÖBB bus transport targets of our strategy: division. Postbus lost nearly 4.3 million passengers; this was due in part to demographic developments 500 million passengers and and the resulting drop in the number of school 150 million tonnes of freight. children and apprentices and in part to the difficult Safe and punctual. competition. However, thanks to a success ratio of 91 percent in last year's transport tenders, Postbus again transported more than 216 million passengers. Vienna Central Station and Graz Central Station In the past financial year, two central transport hubs were put to the test, with the central stations in Vienna and Graz entering into full operation. Since then, all ÖBB long-distance trains have passed through these hubs. The Vienna central station handles more than 1,100 trains in local and long- distance transport every day, making it the most important regional, national and international trans- fer hub in Austria. In addition, the two hub railway stations serve to connect seven provincial capitals directly to Vienna International Airport. The good utilization of this service – the train to the airport – shows that ÖBB has perfectly met the needs of its customers. Rail Cargo Group – a reliable business partner The Rail Cargo Group (RCG) consolidated its position at the top of the European rail freight carriers in 2016. In a year in which almost no major rail freight companies in Europe were able to make a profit, RCG achieved an EBT of over EUR 40 million thanks to a strong fourth quarter. Both Rail Cargo Austria (74.5%) and Rail Cargo Hungaria (60%) remained clear market leaders in their domestic markets, and, as in 2015, the Rail Cargo Group achieved increases in volumes on the inter- national markets. The Rail Cargo Group, which has operations in a total of 18 European countries, has long taken the view: “Our (domestic) market is Europe.” Investing in the future The hundreds of construction projects imple- mented by ÖBB-Infrastruktur AG have had a long-term positive impact on the reputation of ÖBB in a way that little else has. Our railway stations – as we know from several custom- er surveys – have been regarded as clean and safe since then, and our customers assess time spent in our railway stations as “comfortable”. This assessment is very motivating for the entire company, but at the same time it is particularly important for all taxpayers that we implement our construction projects on time and, above all, at planned costs. This is something we accom- plished again in 2016. In addition to the major projects Koralm railway, Semmering base tunnel and Brenner base tunnel, a large number of smaller and medium-sized MAG. JOSEF HALBMAYR MBA. Board of Management of ÖBB-Holding AG (CFO) railway stations across Austria were modernized
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