In the following table, revenues are broken down into a combination of transport type and geographic area.
(in millions of euros) | Revenues | Additional government contributions in the context of COVID-19 | 2020 | 2019 |
Train-related transport in the Netherlands | 1,539 | 818 | 2,357 | 2,661 |
Station development and operation in the Netherlands | 376 | 24 | 400 | 547 |
Train-related transport in the United Kingdom | 1,665 | 1,195 | 2,860 | 2,696 |
Bus-related transport in the United Kingdom | 240 | - | 240 | 223 |
Train-related transport in Germany | 744 | - | 744 | 534 |
Total revenue | 4,564 | 2,037 | 6,601 | 6,661 |
Public transport availability payment/main rail network (train-related transport in the Netherlands)
Based on the 2020 public transport availability payment arrangement as issued by the Ministry of Infrastructure and Water Management, NS is entitled to compensation as a result of the loss of revenue that NS suffered as a result of the pandemic. The compensation amounts to 93% of the eligible costs, less 100% of the revenues realised during the period from 1 March 2020 to 31 December 2020. Based on a calculation, NS has accounted for the allowance in the amount of €818 million. NS received the advance of €616 million in October 2020, being 80% of the calculation at the time of application. In order to claim the public transport availability payment, conditions apply, such as operating a full timetable. These conditions were assessed by NS with the aid of the draft protocol and, based on this, concluded that the 2020 availability payment can be accounted for.
Temporary emergency bridging measure for sustained employment (Noodfonds Overbrugging Werkgelegenheid; NOW)
For the activities relating to station development and operation in the Netherlands, the so-called NOW compensation (operating company scheme) was applied for and recognised as revenue in the amount of €24 million. In order to claim the NOW compensation, conditions apply, such as the prohibition of management bonuses and an agreement from the employee representation. NS reviewed the applicable conditions and, based on this, concluded that the NOW compensation could be accounted for.
EMA/ERMA (train-related transport in the United Kingdom)
The COVID-19 outbreak resulted in the contract terms and conditions for Greater Anglia, East and West Midlands and ScotRail being amended by the DfT by means of EMAs until 20 September 2020. The contracting authority has subsequently followed up on the term of the EMAs by issuing ERMAs for Greater Anglia, East and West Midlands, which are subsequently converted into new direct award contracts upon expiry of this form of contract. These ERMAs have been signed by NS. For ScotRail, an EMA2 has been agreed with Transport Scotland. The amended contract forms have resulted in €1,195 million in additional revenue during 2020.
Other
Station development and operation in the Netherlands includes an amount of €39 million (2019: €32 million) relating to development activities.
Accounting policy
Revenue
Revenue is recognised on the basis of the fee established in a contract with a customer. The Group recognises revenue when it transfers control of a good or service to a customer. Sales include the transport revenues and revenues from other business activities less discounts and turnover tax.
Provision of services and sale of goods
Revenue from the sale of travel rights is recognised when the travel right arises. Revenue from season tickets is recognised over time and spread over the period in the profit and loss account over the validity of the period of the season ticket.
Revenue from the sale of goods is recognised in the income statement when control of the goods has been transferred to the buyer, recovery of the consideration due is probable and the associated costs or any returns of goods can be estimated reliably.
Government or similar fees arising from transport contracts or franchises are recognised in the income statement over the period to which the fee relates.
Additional government contributions in the context of COVID-19
Government contributions in the context of COVID-19 are determined on the basis of individual arrangements with various government agencies and are intended to cover costs incurred/compensate for loss of revenue during (part of) the financial year. The final amount of these contributions for 2020 will be finalised in 2021, but are sufficiently certain to be recognised in the financial statements on the basis of IAS 20. Contributions have been allocated to the period to which they apply. The availability payment in the Netherlands was determined on the basis of the preliminary technical memorandum and draft control protocol.
Rental income
Rental income from property is recognised in the income statement over time, over the term of the lease. Commitment costs incurred as an incentive to enter into lease arrangements are recognised as an integral part of the total rental income and spread on a straight-line basis over the contract period. Rent reductions granted as a result of COVID-19 during current contracts for services to be provided are spread on a straight-line basis over the contract period. Rent reductions granted retroactively for services already rendered are not deducted from revenue but are included in the assessment of expected credit losses under IFRS 9.