Fresenius Se & Co. Kgaa · XETR:FRE

Fresenius Se & Co. Kgaa — Deutsche Bank European Leveraged Finance Conference 2014

50 slides from Fresenius Se & Co. Kgaa's conference presentation, Jun 11, 2014

  1. Slide 1: Health Care Worldwide

    Health Care Worldwide Deutsche Bank – European Leveraged Finance Conference June 11, 2014 – London Deutsche Bank – European Leveraged Finance Conference, June 11, 2014 © Copyright Page 1

  2. Slide 2: Safe Harbor Statement

    Safe Harbor Statement This presentation contains forward-looking statements that are subject to various risks and uncertainties. Future results could differ materially from those described in these forward-looking statements due to certain factors, e.g. changes in business, economic and competitive

  3. Slide 3: Agenda

    Agenda  Company Overview  Business Segments - Fresenius Medical Care - Fresenius Kabi - Fresenius Helios - Fresenius Vamed  Financial Overview  Financing Facilities and Debt Structure  Summary and Outlook Deutsche Bank – European Leveraged Finance Conference, June 11, 2014 © Copyright Page 3

  4. Slide 4: Company Overview

    Company Overview Deutsche Bank – European Leveraged Finance Conference, June 11, 2014 © Copyright Page 4

  5. Slide 5: Strong and Balanced Health Care Portfolio

    Fresenius Group: Strong and Balanced Health Care Portfolio Sales 2013 €20.3 bn EBITDA 20131 €3.9 bn S&P: BB+ positive Market Cap.2 €19.8 bn Moody‘s: Ba1 negative Group EV3 €43.1 bn Fitch: BB+ positive ~ 31% 100% 100%4 77%4 Sales 2013 $14,610 m €4,996 m €3,393 m €1,020 m EBITDA 2013 $2,904 m €1,143 m

  6. Slide 6: Sales Distribution by Region 2013

    Fresenius Group: Sales Distribution by Region –2013 Asia-Pacific Africa 10% 2% Latin America 6% Europe €20.3 bn 40% North America 42% Deutsche Bank – European Leveraged Finance Conference, June 11, 2014 © Copyright Page 6

  7. Slide 7: Fresenius Group: Financial Results

    Fresenius Group: Financial Results €m 20,331 +8% cc Sales 19,290 5-year CAGR: 9% 16,3614 15,972 3,045 EBIT1,2 14,164 3,075 +1% cc 5-year CAGR: 10% 2,563 2,418 2,054 1,778 Net Income1,3 1,707 +7% cc 5-year CAGR: 15% 1,408 1,243 1,011 2009 2010 2011 2012 2013 1 – Before special items 2 – 2013 excludin

  8. Slide 8: Organic Growth 1999–2013

    Fresenius Group: Organic Growth 1999 –2013 Target: > 2x World GDP Growth Deutsche Bank – European Leveraged Finance Conference, June 11, 2014 © Copyright Page 8

  9. Slide 9: Sustainable Organic Sales Growth in all Business Segments

    Fresenius Group: Sustainable Organic Sales Growth in all Business Segments Fresenius Medical Care Fresenius Kabi Fresenius Helios Fresenius Vamed Deutsche Bank – European Leveraged Finance Conference, June 11, 2014 © Copyright Page 9

  10. Slide 10: Financial Results Q1/14

    Fresenius Group: Financial Results Sales EBIT1 Net income2 Q1/14 €5,212 m €643 m €372 m Growth at constant 11% -6% -1% currency rates Growth at actual 7% -8% -2% currency rates 1 – 2014 before Fenwal integration costs (€1 million) and the book gain from the divestment of two HELIOS hospitals (€22 mi

  11. Slide 11: Financial Results by Business Segment

    Fresenius Group: Financial Results by Business Segment Q1/14 Fresenius Fresenius Fresenius Fresenius Medical Care Kabi Helios Vamed Sales $3,564 m €1,213 m €1,227 m €191 m Growth 3% -4% 46% 4% EBIT $445 m €201 m1 €114 m2 €6m Growth -10% -15% 31% 20% 1 – before Fenwal integration costs 2 – before €22

  12. Slide 12: Q1 Business Update

    Q1 Business Update Operations & Markets Europe - 2% organic sales decline, mainly due to reduced HES sales and changes in Russian distribution model - Confirm 2% – 5% 2014e organic sales growth Asia-Pacific - 3% organic sales growth (10% excluding China) reflecting yoy price cut impact and discontin

  13. Slide 13: Q1 Business Update

    Q1 Business Update Operations & Markets North America - Flat organic sales growth on shortage-inflated Q1/13 - Expect -2% to +5% 2014 organic sales growth (previously: -5% to +5%) - Drug shortage Sodium Chloride 0.9% – regulatory discretion1 for importation from Europe extended until Dec. 31, 2014 -

  14. Slide 14: Q1 Business Update

    Q1 Business Update Operations & Markets Strong start into the year - €115 m order entry in Q1 – driven by hospital projects in emerging markets Strategic Initiatives Emerging markets expansion - Promising acquisition pipeline to expand presence in fast- growing markets - Currently pursuing only smal

  15. Slide 15: Business Segments

    Business Segments Deutsche Bank – European Leveraged Finance Conference, June 11, 2014 © Copyright Page 15

  16. Slide 16: Fresenius Medical Care: Global Market Leader in Dialysis

    Fresenius Medical Care: Global Market Leader in Dialysis - World leader in dialysis products and services Industry Dynamics treating 270,122 patients in 3,250 clinics ~6% global patient growth p.a.; ~3.8 million patients by 2020 expected worldwide1 Patients in million - Provide highest standard of p

  17. Slide 17: Fresenius Medical Care: Key Figures 2013

    Fresenius Medical Care: Key Figures 2013 $ million 2013 20121 Growth Sales 14,610 13,800 + 6%2 EBITDA 2,904 2,931 - 1% EBITDA margin 19.9% 21.2% EBIT 2,256 2,329 - 3% EBIT margin 15.4% 16.9% Net income 1,110 1,118 - 1% 1 – Before one-time items 2 – 5% organic growth, 1% acquisitions , -1% divestitur

  18. Slide 18: Fresenius Medical Care: Key Figures Q1/2014

    Fresenius Medical Care: Key Figures Q1/2014 $€ million million Q1/2013 Q1/2014 Q1/2012 Q1/2013 Growth Growth Total Sales 3,564 3,464 +3%1 EBITDA 612 650 -6% EBITDA margin 17.2% 18.8% EBIT 445 493 -10% EBIT margin 12.5% 14.2% Net income 205 225 -9% 1 – 3% organic growth, 1% acquisitions , -1% currenc

  19. Slide 19: Fresenius Kabi: A Worldwide Leading Hospital Supplier

    Fresenius Kabi: A Worldwide Leading Hospital Supplier - Comprehensive product portfolio for critically and 2013 Sales by Region chronically ill patients - IV Drugs 29% - Clinical Nutrition Emerging markets €1,421 m - Infusion Therapy 41% - Medical Devices / Transfusion Technology €5.0 bn Europe €2,0

  20. Slide 20: Fresenius Kabi: Profitability Improvement

    Fresenius Kabi: Profitability Improvement Sales in € m EBITDA in € m EBITDA Margin (in %) CAGR CAGR 1 16% 19% 1 – 2013 adjusted for Fenwal integration costs Deutsche Bank – European Leveraged Finance Conference, June 11, 2014 © Copyright Page 20

  21. Slide 21: Fresenius Kabi: Key Figures 2013

    Fresenius Kabi: Key Figures 2013 € million 20131 2012 Growth Sales 4,996 4,539 + 10%2 - Infusion Therapy 980 1,010 -3% - I.V. Drugs 1,733 1,701 +2 % - Clinical Nutrition 1,332 1,314 +1 % - Medical Devices/ 951 514 +85% Transfusion Technology EBITDA1 1,143 1,101 + 4% EBITDA margin 22.9% 24.3% EBIT1 9

  22. Slide 22: Fresenius Kabi: Key Figures Q1/2014

    Fresenius Kabi: Key Figures Q1/2014 € million Q1/2014 Q1/2013 Growth 2 Sales 1,213 1,260 -4% - Infusion Therapy 230 250 -8% - I.V. Drugs 441 460 -4% - Clinical Nutrition 318 326 -2% - Medical Devices/ Transfusion Technology 224 224 +0% 1 EBITDA 253 288 -12% EBITDA margin 20.9% 22.9% 1 EBIT 201 237 -

  23. Slide 23: Fresenius Helios: Leading Private Hospital Operator in Germany

    Fresenius Helios: Leading Private Hospital Operator in Germany - Acute and post-acute care in 109 proprietary Majority of population has access to a hospitals1 HELIOS hospital within one hour‘s drive - High-quality medical care (e.g., mortality rate for heart failure and pneumonia >30% below German

  24. Slide 24: Fresenius Helios: Key Figures 2013

    Fresenius Helios: Key Figures 2013 € million 2013 2012 Growth Sales 3,393 3,200 +6%1 EBITDA 508 432 +18% EBITDA margin 15.0% 13.5% EBIT 390 322 +21% EBIT margin 11.5% 10.1% Net income2 275 203 +35% 1 – 3% organic growth, 4% acquisitions, -1% divestitures 2 – Bad debt level of German hospitals extrem

  25. Slide 25: Fresenius Helios: Key Figures Q1/2014

    Fresenius Helios: Key Figures Q1/2014 € million Q1/2014 Q1/2013 Growth 2 Sales 1,227 841 +46% EBITDA1 158 114 +39% EBITDA margin 12.9% 13.6% EBIT1 114 87 +31% EBIT margin 9.3% 10.3% Net income 77 56 +38% 1 – Excluding €22 million of book gain from the divestments of two Helios hospitals 2 – 4% organ

  26. Slide 26: Fresenius Vamed: Leading Specialist in Hospital Projects and Services

    Fresenius Vamed: A Leading Global Specialist in Hospital Projects and Services - Specialized in project development building 2013 Sales by Business hospital infrastructure and providing hospital services (technical services and operational management) 43% Services €437 m €1,020 m - Track record: 57%

  27. Slide 27: Fresenius Vamed: Achievements 2013

    Fresenius Vamed: Achievements 2013 - Outstanding year with 21% sales growth, exceeding €1 billion sales target one year ahead of plan - Project business: 5-year sales CAGR of 12%; 2013 order entry (€744 m) at all-time high – driving further growth Technical Service Contract – University Medical Cent

  28. Slide 28: Fresenius Vamed: Key Figures 2013

    Fresenius Vamed: Key Figures 2013 € million 2013 2012 Growth Total Sales 1,0201 846 21%1 EBITDA 65 59 10% EBITDA margin 6.4% 7.0% EBIT 55 51 8% EBIT margin 5.4% 6.0% Net income 37 35 6% Order intake2 744 657 13% 1 – 13% organic growth, 8% acquisitions 2 – project business only Deutsche Bank – Europe

  29. Slide 29: Fresenius Vamed: Key Figures Q1/2014

    Fresenius Vamed: Key Figures Q1/2014 €€ million million Q1/2013 Q1/2014 Q1/2012 Q1/2013 Growth Growth Total Sales 191 184 + 4%1 EBITDA 8 7 +14% EBITDA margin 4.2% 3.8% EBIT 6 5 +20% EBIT margin 3.1% 2.7% Net income 4 3 +33% Order intake 115 93 +24% Order backlog 1,170 1,1392 +3% 1 – -2% organic grow

  30. Slide 30: Financial Overview

    Financial Overview Deutsche Bank – European Leveraged Finance Conference, June 11, 2014 © Copyright Page 30

  31. Slide 31: Demonstrated Strong Sales and EBITDA Growth

    Fresenius Group: Demonstrated Strong Sales and EBITDA Growth Sales in € bn EBITDA in € bn1 CAGR 20,3 CAGR 2 10% 19,3 12% 16.4 16,0 14,2 12,3 11,4 2007 2008 2009 2010 2011 2012 2013 1 – Before special items 2 – Before Fenwal integration costs of €54 million Deutsche Bank – European Leveraged Finance

  32. Slide 32: Fresenius Group: Key Figures 2013

    Fresenius Group: Key Figures 2013 2013 2012 Change Change €m actual constant FX rates FX rates Sales 20,331 19,290 5% 8%1 EBITDA 3,8882 3,851 1% 3% EBIT 3,0452 3,0753 -1% 1% Interest, net - 584 - 666 12% 10% EBT 2,461 2,4093 2% 5% Taxes - 683 - 702 3% 0% Net income4 1,7785 1,7073 4% 7% Employees 178

  33. Slide 33: Fresenius Group: Key Figures Q1/2014

    Fresenius Group: Key Figures Q1/2014 Q1/2014 Q1/2013 Change Change € million actual constant rates rates Sales 5,212 4,890 +7%1 +11% EBITDA 8672 8982 - 3% - 1% EBIT 6432 6962 - 8% - 6% Interest, net - 138 - 1632 +15% +13% EBT 5052 5332 - 5% - 3% Taxes - 133 -155 +14% +10% Net income3,5 3722,3 3782,3

  34. Slide 34: Fresenius Group: Cash Flow 2013

    Fresenius Group: Cash Flow 2013 €m 2013 Margin 2012 Margin Growth YoY Operating Cash Flow 2,320 11.4% 2,438 12.6% -5% Capex (net) -1,047 -5.1% -952 -4.9% -10% Free Cash Flow 1,273 6.3% 1,486 7.7% -14% (before acquisitions and dividends) Acquisitions (net) -2,556 -2,299 -11% Dividends -491 -446 -10%

  35. Slide 35: Cash Flow Development 2013

    Cash Flow Development 2013 €m Operating CF Capex (net) Free Cash Flow1 2013 Margin 2013 Margin 2013 Margin 488 9.8% -311 -6.3% 177 3.5% 3 258 7.6% -167 -4.9% 91 2.7% 31 3.0% -11 -1.0% 20 2.0% Corporate/ Other 11 n/a -10 n/a 1 n/a 2 excl. FMC 788 9.2%2 -499 -5.4% 289 3.8% Group 2,320 11.4% -1,047 -5.

  36. Slide 36: Proven Track Record of Deleveraging

    Fresenius Group: Proven Track Record of Deleveraging Acquisition Acquisition of Renal of APP Care Group Pharmaceuticals Target 2014YE: 3.6x 3.0 to 3.25 3.5x 3.2x 3.2x 3.0x 3.0x 3.0x 2.8x 2.7x 2.5x 2.6x 2.6x 2.6x 2.3x 2.2x 2001 2002 2003 2004 2005 Q1/06 2006 2007 2008 2009 2010 2011 2012 2013 Q1/14 (

  37. Slide 37: Debt and Interest Ratios

    Fresenius Group: Debt and Interest Ratios Mar 31, Dec 31, Net debt/EBITDA 2014 2013 Target 2014YE: 3.0-3.25 Debt (€m) 13,769 12,804 3.26 thereof 45% US$ denominated 3.07 Net debt (€m) 12,940 11,940 Net debt/EBITDA 3.211,2 2.513 2.60 2.72 2.57 2.63 EBITDA/Interest 6.3 6.7 at actual at identical FX-ra

  38. Slide 38: Financing Facilities and Debt Structure

    Financing Facilities and Debt Structure Deutsche Bank – European Leveraged Finance Conference, June 11, 2014 © Copyright Page 38

  39. Slide 39: Current Debt and Cash Flow Structure as of March 31, 2014

    Fresenius Group: Current Debt and Cash Flow Structure as of March 31, 2014 €12,940 m Total Net Debt1 Total Net Debt €7.1 bn €7,162 m Net Debt2 Profit transfer Profit transfer Profit transfer Agreements, Agreements, Agreements, Market Value Upstream Upstream Upstream > €4.5 bn Guarantee Guarantee Gua

  40. Slide 40: Fresenius Medical Care: Debt Maturity Profile

    Fresenius Medical Care: Debt Maturity Profile1 March 31, 2014 Maturity 4.2 years on average 1 – based on utilization of major financing instruments Deutsche Bank – European Leveraged Finance Conference, June 11, 2014 © Copyright Page 40

  41. Slide 41: Group excluding FMC: Debt Maturity Profile

    Fresenius Group excluding FMC: 1 Debt Maturity Profile March 31, 2014 Maturity 4.3 years on average 1 – based on utilization of major financing instruments Deutsche Bank – European Leveraged Finance Conference, June 11, 2014 © Copyright Page 41

  42. Slide 42: Fresenius Group: Debt Maturity Profile

    Fresenius Group: Debt Maturity Profile1 March 31, 2014 Maturity 4.2 years on average 1 – based on utilization of major financing instruments Deutsche Bank – European Leveraged Finance Conference, June 11, 2014 © Copyright Page 42

  43. Slide 43: Summary and Outlook

    Summary and Outlook Deutsche Bank – European Leveraged Finance Conference, June 11, 2014 © Copyright Page 43

  44. Slide 44: Fresenius Medical Care: Financial Outlook

    Fresenius Medical Care: Financial Outlook Reported Guidance 2013 2014 Sales $14,610 ~ $15,200 EBIT $2,256 ~ $2.2bn Net Income $1,110 $1.0-1.05 bn Debt / EBITDA 2.8x ≤ 3.0x  Outlook excludes potential net cost savings from the global efficiency program for 2014  Potential acquisitions not included

  45. Slide 45: Financial Outlook by Business Segment

    Fresenius Group: Financial Outlook by Business Segment Fully Confirmed / Narrowed Old New Fresenius Sales growth organic 3% – 7% 4% – 6% Kabi EBIT margin 16% – 18% 16.5% – 18% Fresenius Sales growth organic 3% – 5% Helios1 EBIT €390 – €410 m Fresenius Sales growth organic 5% – 10% Vamed EBIT growth

  46. Slide 46: Fresenius Group: Financial Outlook

    Fresenius Group: Financial Outlook Guidance 20141 Revenue growth 12% ‒ 15% at constant currency Net income growth2 2% ‒ 5% at constant currency Net debt/ EBITDA 3.0 – 3.25x 1- Guidance includes acquired Rhön hospitals 2- Net income attributable to shareholders of Fresenius SE & Co. KGaA before integ

  47. Slide 47: Ideal Strategic Posture to Benefit from Major Healthcare Trends

    Fresenius Group: Ideal Strategic Posture to Benefit from Major Healthcare Trends Aging population and higher incidence of chronic diseases World population aged 60+ will more than double by 2050 to >2 bn (OECD) Increasing health care spending in emerging markets Increasing health care coverage and p

  48. Slide 48: Attractive Mid-Term Growth Prospects

    Fresenius Group: Attractive Mid-Term Growth Prospects New Stretch Target ~€30 billion sales €1.4 to €1.5 billion net income by 2017 Strong and Balanced Health Care Portfolio Deutsche Bank – European Leveraged Finance Conference, June 11, 2014 © Copyright Page 48

  49. Slide 49: Investment Highlights

    Investment Highlights Leading market positions Diversified revenue base with four strong business segments Global presence in growing, non-cyclical markets Proven ability to integrate acquisitions Clear track record of and commitment to de-leveraging Strong financial performance and cash flow genera

  50. Slide 50: Health Care Worldwide

    Health Care Worldwide Deutsche Bank – European Leveraged Finance Conference, June 11, 2014 © Copyright Page 50

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