Fresenius Medical Care Ag · XETR:FME
Fresenius Medical Care — Q3 2021 Earnings Presentation
30 slides from Fresenius Medical Care's earnings presentation, Nov 2, 2021
Slide 1: Q3 2021 Conference Call
Q3 2021 CONFERENCE CALL NOVEMBER 2, 2021 Rice Powell – CEO & Chairman Helen Giza – CFO & CTO © Copyright
Slide 2: Safe harbor statement
Safe harbor statement: This presentation includes certain forward-looking statements within the meaning of Section 27A of the U.S. Securities Act of 1933, as amended, and Section 21E of the U.S. Securities Act of 1934, as amended. Forward-looking statements are inherently subject to risks and uncert
Slide 3: Agenda
1 BUSINESS UPDATE 2 FINANCIALS & OUTLOOK AGENDA 3 Q&A
Slide 4: Q3 2021 | Continued negative effects from COVID-19
Q3 2021 | CONTINUED NEGATIVE EFFECTS FROM COVID-19 > Stronger than projected headwind from COVID-19 effects with significantly increased patient excess mortality due to global spread of Delta variant > Organic growth continued with 1% > Financial targets for FY 2021 confirmed, expectation to reach l
Slide 5: 9M 2021 | Delivering the upmost quality of care
9M 2021 | DELIVERING THE UPMOST QUALITY OF CARE +2% Clinics (1%) Patients 4,151 344,872 Quality remains (1%) Treatments on a consistently 39,510,028 high level Clinics and patients as of September 30, 2021 © │ Conference Call │ Q3 2021 11/02/2021 Page 5
Slide 6: 9M 2021 | Excellent quality of care
9M 2021 | EXCELLENT QUALITY OF CARE NORTH AMERICA EMEA LATIN AMERICA ASIA-PACIFIC % of patients Q3 2021 Q3 2020 Q3 2021 Q3 2020 Q3 2021 Q3 2020 Q3 2021 Q3 2020 Kt/V ≥ 1.2 97 97 93 93 94 91 94 94 Hemoglobin = 10–12 g/dl 71 71 81 82 48 46 51 52 Calcium = 8.4–10.2 mg/dl 83 80 80 77 74 74 70 71 Albumin
Slide 7: Confirmed COVID-19 cases since January 2020
CONFIRMED COVID-19 CASES SINCE JANUARY 2020 GENERAL POPULATION CASES GLOBALLY FME PATIENT CASES GLOBALLY Vaccination of approx. 3,000 78 percent of patients at 900,000 least with first dose. 800,000 2,500 700,000 600,000 2,000 500,000 1,500 400,000 300,000 1,000 200,000 500 100,000 0 0 Rolling 7-day
Slide 8: Delta variant fuels excess mortality globally
DELTA VARIANT FUELS EXCESS MORTALITY GLOBALLY QUARTERLY EXCESS MORTALITY VS. 2019 BASE LTM ▪ Increase in COVID- 3,705 19-related excess deaths following 3,160 spread of Delta 2,739 2,739 variant 2,934 ▪ LTM excess mortality amounts to 11,507 1,903 1,001 ▪ Total number of excess deaths vs. 2019 base
Slide 9: Q3 2021 | Stable revenue despite COVID-19
Q3 2021 | STABLE REVENUE DESPITE COVID-19 Q3 2021 Q3 2020 Growth Growth € million € million in % in %cc Revenue 4,441 4,414 1 1 ▪ Increase of Delta variant within patient population and continued Operating income 505 632 (20) (19) COVID-19 impacts on revenue and Operating income 510 632 (19) (19) ea
Slide 10: Q3 2021 | Positive organic growth despite COVID-19 effects
Q3 2021 | POSITIVE ORGANIC GROWTH DESPITE COVID-19 EFFECTS NORTH AMERICA € million Revenue 3,080 0% NORTH AMERICA Organic growth 1% EMEA 70% 15% EMEA 4,441 € million €M ASIA-PACIFIC Revenue 671 (2%) 11% +1% Organic growth (2%) (Organic) ASIA-PACIFIC € million LATIN AMERICA 4% Revenue 501 4% Organic
Slide 11: Agenda
1 BUSINESS UPDATE 2 FINANCIALS & OUTLOOK AGENDA 3 Q&A
Slide 12: Q3 2021 | Positive services growth despite COVID-19
Q3 2021 | POSITIVE SERVICES GROWTH DESPITE COVID-19 Same market Organic Q3 2021 Q3 2020 Growth Growth treatment growth € million € million in % in %cc in % growth Drivers Revenue in % - Organic growth Health Care Services 3,530 3,499 1 2 1 (2) negatively North America 2,810 2,801 0 1 0 (2) impacted
Slide 13: Q3 2021 | Products under pressure from COVID-19
Q3 2021 | PRODUCTS UNDER PRESSURE FROM COVID-19 Organic Q3 2021 Q3 2020 Growth Growth € million € million in % in %cc growth Revenue in % Drivers Health Care Products 911 915 0 (1) 0 North America 270 268 1 1 1 - In-center EMEA 325 336 (3) (3) (3) disposables Asia-Pacific 262 257 2 (1) (1) - Periton
Slide 14: 9M 2021 | Operating margin development
9M 2021 | OPERATING MARGIN DEVELOPMENT 13.7% (2.5pp) 9M operating income margin drivers ‒ Adverse impact from COVID-19 (1.7pp) ‒ Inflationary & labor cost increases +0.2pp +0.2pp 10.8% + Improved Medicare Advantage payor mix +0.9pp in the U.S. + Reimbursement rate increase + Prior year impairment fo
Slide 15: Q3 2021 | Strong underlying cash flow development
Q3 2021 | STRONG UNDERLYING CASH FLOW DEVELOPMENT Q3 2021 Q3 2020 € million € million Operating cash flow 692 746 In % of revenue 15.6 16.9 Capital expenditures, net (181) (239) Free cash flow 511 507 Free cash flow after investing activities 391 458 NET LEVERAGE RATIO (NET DEBT/EBITDA)1 Current rat
Slide 16: 2021 targets confirmed
2021 TARGETS CONFIRMED Assumptions: • Excess mortality to continue to REVENUE NET INCOME accumulate in the first half of 2021, (constant currency (constant currency returning to normalized mortality pattern growth in %) decline in %) in the second half of 2021 • COVID-19-related additional costs in
Slide 17: Your Questions Are Welcome!
ad ~ FRESENIUS MEDICAL CARE ) Your Questions Are Welcome!
Slide 18: Q3 2021 | Profit and loss
Q3 2021 | PROFIT AND LOSS Q3 2021 Q3 2020 Growth Growth € million € million in % in %cc Revenue 4,441 4,414 1 1 Operating income 505 632 (20) (19) Operating income margin in % 11.4 14.3 Operating income excl. special items 510 632 (19) (19) Operating income margin in % excl. special items 11.5 14.3
Slide 19: 9M 2021 | Profit and loss
9M 2021 | PROFIT AND LOSS 9M 2021 9M 2020 Growth Growth € million € million in % in %cc Revenue 12,972 13,459 (4) 2 Operating income 1,403 1,843 (24) (20) Operating income margin in % 10.8 13.7 Operating income excl. special items 1,417 1,843 (23) (19) Operating income margin in % excl. special item
Slide 20: 9M 2021 Services
9M 2021 SERVICES Same market Organic 9M 2021 9M 2020 Growth Growth treatment growth € million € million in % in %cc in % growth Revenue in % Health Care Services 10,255 10,708 (4) 2 1 (2) North America 8,148 8,660 (6) 0 0 (3) EMEA 1,020 1,028 (1) 1 0 (4) Asia-Pacific 694 641 8 12 11 6 Latin America
Slide 21: 9M 2021 Products
9M 2021 PRODUCTS Organic 9M 2021 9M 2020 Growth Growth € million € million in % in %cc growth Revenue in % Health Care Products 2,717 2,751 (1) 2 2 North America 783 835 (6) 0 0 EMEA 1,013 1,020 (1) 1 1 Asia-Pacific 764 736 4 4 4 Latin America 144 148 (3) 8 8 EMEA NORTH AMERICA 38% 29% 2,717 €M +2%
Slide 22: Debt
DEBT RECONCILIATION OF NON-IFRS FINANCIAL MEASURES TO THE MOST DIRECTLY COMPARABLE IFRS FINANCIAL MEASURES Q3 2021 FY 2020 FY 2019 € million € million € million Debt Short-term debt from unrelated parties 1,324 63 1,150 + Short-term debt from related parties 39 17 22 + Current portion of long-term d
Slide 23: EBITDA
EBITDA RECONCILIATION OF ANNUALIZED ADJUSTED EBITDA AND NET LEVERAGE RATIO TO THE MOST DIRECTLY COMPARABLE IFRS FINANCIAL MEASURES Q3 2021 LTM FY 2020 FY 2019 € million € million € million Net income 1,154 1,435 1,439 + Income tax expense 413 501 402 − Interest income (59) (42) (62) + Interest expen
Slide 24: 2020 base for targets 2021, reconciliation adjustments
2020 BASE FOR TARGETS 2021, RECONCILIATION ADJUSTMENTS FY 2020 Q1 2020 Q2 2020 Q3 2020 Q4 2020 € million € million € million € million € million Revenue 17,859 4,488 4,557 4,414 4,400 Net income excl. special items 1,359 283 351 354 372 RECONCILIATION OF NON-IFRS FINANCIAL MEASURES TO THE MOST DIREC
Slide 25: Return on invested capital (ROIC)
RETURN ON INVESTED CAPITAL (ROIC) ▪ Long-term value 12.4% rep. creation based on accretive acquisitions and organic growth ▪ 2018 positive impact 8.6% from Sound 7.8% 8.0% adj. 8.0% adj. divestiture 7.1% 6.6% excl. special item ▪ 2019 negative 6.1% rep. 5.5% excl. special item impact from NxStage ac
Slide 26: Exchange rates, U.S. dialysis days per quarter, definitions
EXCHANGE RATES, U.S. DIALYSIS DAYS PER QUARTER, DEFINITIONS EXCHANGE RATES U.S. DIALYSIS DAYS PER QUARTER 9M 2021 9M 2020 FY 2020 Q1 Q2 Q3 Q4 Full year €:USD Period end 1.158 1.171 1.227 2021 77 78 79 79 313 Average 1.196 1.125 1.142 2020 77 78 79 79 313 2019 76 78 79 80 313 €:CNY Period end 7.485 7
Slide 27: Q3 2021 | Patients, treatments, clinics
Q3 2021 | PATIENTS, TREATMENTS, CLINICS Patients Treatments Clinics Patients Treatments Clinics as of Sep. 30, as of Sep. 30, as of Sep. 30, as of Sep. 30, as of Sep. 30, as of Sep. 30, 2021 2021 2021 2020 2020 2020 North America 209,651 24,158,943 2,683 211,766 24,600,114 2,620 Growth in % (1) (2)
Slide 28: 2021 | Simplification of reporting going forward
2021 | SIMPLIFICATION OF REPORTING GOING FORWARD FY 2020 FY 2019 Growth FY 2020 FY 2019 Growth € million € million in % € million € million in % Revenue Revenue Health Care Services 14,114 13,872 2 Health Care Services 14,114 13,872 2 North America 11,364 11,157 2 North America 11,364 11,157 2 Of wh
Slide 29: Financial calendar 2021
FINANCIAL CALENDAR 2021 REPORTING DATES November 12 Quarterly financial report within the 2nd half-year (Q3) February 22 Q4 2021 Earnings Release and Conference Call CONFERENCES & MEET THE MANAGEMENT November 5 J.P. Morgan - European Healthcare CEO Series with Rice Powell November 10 UBS European Co
Slide 30: Contacts
CONTACTS DR. DOMINIK HEGER ROBERT ADOLPH FME INVESTOR Head of Investor Relations, Strategic Vice President RELATIONS Development & Communications | EVP Investor Relations Else-Kröner-Str. 1 61352 Bad Homburg v.d.H. +49(0) 6172-609-2601 +49(0) 6172-609-2477 Germany dominik.heger@fmc-ag.com robert.ado
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