Fresenius Medical Care Ag · XETR:FME
Fresenius Medical Care — Barclays Global Healthcare Conference 2023
44 slides from Fresenius Medical Care's conference presentation, Mar 14, 2023
Slide 1: Barclays Global Healthcare Conference March 14 & 15, 2023
Barclays Global Healthcare Conference March 14 & 15, 2023 © Copyright
Slide 2: Securities Act notice regarding Form F-4 registration
Under the U.S. Securities Act of 1933, as amended (the “Securities Act”), this presentation may be deemed to be offering material of Fresenius Medical Care AG & Co. KGaA (“FME”). FME intends to file a registration statement on Form F-4 under the Securities Act with the U.S. Securities and Exchange C
Slide 3: 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 4: Agenda
1 At a Glance 2 Strategy & FME25 3 Financials & Outlook Agenda
Slide 5: Investment highlights
Investment highlights Business & Strategy Growth drivers Sustainability FME25 Leading vertically Benefitting from solid Embedded in vision, Transformation program integrated global dialysis underlying trends mission and strategy enables execution on provider strategy Largest dialysis Growing and
Slide 6: Leading vertically integrated dialysis provider
Leading vertically integrated dialysis provider Largest dialysis network Products serving more than half worldwide of the world’s dialysis patients 15,418 Revenue Revenue €m €m 3,980 2022 2022 >160 m ~ 42,000 1 out of 2 Products >4,100 Every 0.6 >344,000 >52 m Dialysis treat- available ments provide
Slide 7: Agenda
1 At a Glance 2 Strategy & FME25 3 Financials & Outlook Agenda
Slide 8: Enhancing patients' lives is what drives Fresenius Medical Care
Enhancing patients’ lives is what drives Fresenius Medical Care Our Vision Creating a future worth living. For patients. Worldwide. Every day. Our Mission Providing the best possible care. Sustainably in diverse Health Care systems. For a growing number of patients around the world. Our Strategic As
Slide 9: Key growth drivers in core dialysis business remain intact
Key growth drivers in core dialysis business remain intact Addressing global Health Care Challenges AGEING GLOBAL POPULATION HYPERTENSION DIABETES DIALYSIS PATIENTS One out of four people +150% worldwide has hypertension! +325% +440% Global population People living People living People on maintenanc
Slide 10: Capturing growth potential
Capturing growth potential Driving Value-based Care Expanding Home dialysis Improve clinical outcomes and quality of life for patients, Aspirational target: reduce overall costs for payors and expand into CKD Leverage longstanding experience in Value-based Care and largest database of CKD pati
Slide 11: Unlock value as the leading kidney care company
Creating a future worth living. For patients. Worldwide. Every day. Unlock value as the leading kidney care company. Global operating model Financial reporting with Structure Simplified governance with two segments enhanced transparency Capital Disciplined financial policy ROIC improvement focus all
Slide 12: Structure | Simplified operating model
Structure | Simplified operating model New global operating model implemented Two globalized operating segments with end-to-end P&L responsibility Care Delivery Care Enablement Health Care Services Health Care Products Increased transparency to drive business performance improvement Global Medic
Slide 13: Structure | Proposed future simplified governance model
Structure | Proposed future simplified governance model Current governance structure Potential, future governance structure Highly complex, with many layers of decision making Simplified and in line with international standards Shareholders Supervisory Board Fresenius Medical Care AG Management Boar
Slide 14: Structure | Proposed future simplified governance model
Structure | Proposed future simplified governance model Advantages Considerations Simplified governance structure strengthening Limited rating pressure expected rights of free float shareholders Administrative steps required (incl. EGM) Faster and fully independent decision making One-off
Slide 15: Capital allocation | Disciplined financial policy & ROIC investment focus
Capital allocation | Disciplined financial policy & ROIC investment focus Committed to investment grade and to manage net financial leverage in the self-imposed range of 3.0 to 3.5x Deleveraging Potential divestitures gains from portfolio optimization to be used for deleveraging Dividend polic
Slide 16: Operational efficiencies | FME25 accelerated & extended
Operational efficiencies | FME25 accelerated & extended FME25 framework Accelerated & extended initiative Alignment of new operating model Sustainable 2021 Transformation journey defined & first One time Further Care initiatives started savings of costs up to Enablement EUR 650m EUR 650m opportuni
Slide 17: Operational efficiencies & portfolio optimization
Operational efficiencies & portfolio optimization Unlock value as the leading kidney care company Care Delivery Care Enablement Turnaround efforts focused on Efficiency improvements to drive productivity and efficiency margin expansion: measures ― Pricing initiatives Operational Improve operat
Slide 18: Committed to sustainability. Purpose driven. Patient-centric.
Committed to sustainability. Purpose driven. Patient-centric. Our commitment to sustainability is an integral part of our vision and strategy. Sustainability target focus Enhance quality of care and access to health care Build the best team to serve patients Reduce our environmental footprint
Slide 19: CO2 emissions reduction | Climate
Global climate targets1 In line with a 1.5°C science-based scenario Implementation roadmap 50% Continuous monitoring of opportunities and 2030 flexibility to be able to react to… CO2 emissions Dynamic energy markets and prices reduction Energy efficiency and production opportunities Levers to ac
Slide 20: Sustainability Highlights
Sustainability Highlights Global Sustainability Key achievements 2023+ sustainability Program successfully targets & priorities set completed in 2022 Purpose >30 global policies and Patient satisfaction New measurement: Global driven. standards implemented for sustainability topics NPS of 71 confirm
Slide 21: Agenda
1 At a Glance 2 Strategy & FME25 3 Financials & Outlook Agenda
Slide 22: FY 2022 | Continued organic growth
FY 2022 | Continued organic growth Key Figures FY 2022 FY 2021 Growth Growth € million € million in % in %cc Revenue 19,398 17,619 10 2 Operating 1,512 1,852 (18) (25) income Operating income 1,817 1,915 (5) (13) excl. special items1 Higher labor costs, staff shortages and inflationary Net income
Slide 23: FY 2022 | International regions drove organic growth
FY 2022 | International regions drove organic growth HEALTH CARE PRODUCTS HEALTH CARE SERVICES Revenue: €15,418 million Revenue: €3,980 million +11% | +2% cc | +1% organic +6% | +2% cc | +2% organic Strong contribution to organic growth from EMEA Higher sales of in-center disposables and renal a
Slide 24: FY 2022 | Operating income margin development
FY 2022 | Operating income margin development 10.5% (0.2pp) (1.2pp) 0.6pp 9.4% (1.1pp) (1.3pp) 1.0pp (0.5pp) 0.3pp (0.2pp) (0.1pp) 7.8% FY 2021 Business Labor cost Macro- Governmental FME25 FY 2022 FME25 Humacyte InterWell Ukraine Hyperinflation FY 2022 operating growth, incl. increase economic supp
Slide 25: FY 2022 | Stable free cash flow generation
FY 2022 | Stable free cash flow generation FY 2022 FY 2021 € million € million Key developments: Operating cash flow 2,167 2,489 Operating cash Capital expenditures, net (687) (829) flow development driven by lower Free cash flow 1,480 1,660 net income, Free cash flow after investing activities 1,
Slide 26: FY 2023 | Assumptions Operating Income
FY 2023 | Assumptions Operating Income 2023 expected to be a transition year towards earnings growth recovery in 2024 Assumptions Significant headwind from inflationary cost environment of EUR 200-240m Labor cost headwind of EUR 140-180m No additional governmental support assumed U.S. dialys
Slide 27: Outlook
Outlook FY 2023 Revenue [%] Operating income [%] Low to mid-single digit growth Flat to high-single digit decline (FY2022 basis: EUR 19.4bn) (FY2022 basis: EUR 1.54bn1) Further outlook By 2025 an improved operating income margin of 10 to 14% is targeted Outlook is provided in constant currency and e
Slide 28: Appendix
ad FRESENIUS vy MEDICAL CARE Appendix
Slide 29: Q4 2022 | Profit and Loss
Q4 2022 | Profit and Loss Q4 2022 Q4 2021 Growth Growth € million € million in % in %cc Revenue 4,997 4,647 8 2 Operating income 352 449 (22) (28) Operating income margin in % 7.0 9.7 Operating income excl. special items 495 492 1 (8) Operating income margin in % excl. special items 9.9 10.6 Net int
Slide 30: FY 2022 | Profit and Loss
FY 2022 | Profit and Loss FY 2022 FY 2021 Growth Growth € million € million in % in %cc Revenue 19,398 17,619 10 2 Operating income 1,512 1,852 (18) (25) Operating income margin in % 7.8 10.5 Operating income excl. special items 1,817 1,915 (5) (13) Operating income margin in % excl. special items 9
Slide 31: Q4 2022 | Health Care Services
Q4 2022 | Health Care Services Q4 2022 Q4 2021 Growth Growth Organic Same market € million € million in % in %cc growth treatment in % growth Revenue in % Health Care Services 3,947 3,621 9 2 3 (1) North America 3,216 2,872 12 0 0 (2) EMEA 373 359 4 6 6 1 Asia-Pacific 251 248 1 4 5 2 Latin America 1
Slide 32: Q4 2022 | Health Care Products
Q4 2022 | Health Care Products Q4 2022 Q4 2021 Growth Growth Organic growth € million € million in % in %cc in % Revenue Health Care Products 1,050 1,026 2 0 0 North America 313 284 10 (2) (2) EMEA 357 373 (4) (1) (1) Asia-Pacific 312 304 3 2 2 Latin America 62 60 4 8 8 cc = at constant currency Nor
Slide 33: FY 2022 | Health Care Services
FY 2022 | Health Care Services FY 2022 FY 2021 Growth Growth Organic Same market € million € million in % in %cc growth treatment in % growth Revenue in % Health Care Services 15,418 13,876 11 2 1 (1) North America 12,400 11,020 13 0 (1) (2) EMEA 1,456 1,379 6 6 6 0 Asia-Pacific 981 942 4 4 3 2 Lati
Slide 34: FY 2022 | Health Care Products
FY 2022 | Health Care Products FY 2022 FY 2021 Growth Growth Organic growth € million € million in % in %cc in % Revenue Health Care Products 3,980 3,743 6 2 2 North America 1,150 1,068 8 (4) (4) EMEA 1,395 1,386 1 3 3 Asia-Pacific 1,171 1,068 10 4 4 Latin America 244 204 20 14 14 cc = at constant c
Slide 35: Debt
Debt Reconciliation of non-IFRS financial measures to most directly comparable IFRS financial measures Q4 2022 FY 2021 FY 2020 € million € million € million Debt Short-term debt from unrelated parties 665 1,178 63 + Short-term debt from related parties 4 78 17 + Current portion of long-term debt 694
Slide 36: EBITDA
EBITDA Reconciliation of annualized adjusted EBITDA and net leverage ratio to the most directly comparable IFRS financial measures LTM Q4 2022 FY 2021 FY 2020 € million € million € million Net income 895 1,219 1,435 + Income tax expense 325 353 501 − Interest income (68) (73) (42) + Interest expense
Slide 37: 2022 base for 2023 targets, reconciliation adjustments
2022 base for 2023 targets, reconciliation adjustments FY 2022 Q1 2022 Q2 2022 Q3 2022 Q4 2022 € million € million € million € million € million Revenue 19,398 4,548 4,757 5,096 4,997 Operating income 1,540 390 284 377 489 Reconciliation of non-IFRS financial measures to the most directly comparable
Slide 38: Return on Invested Capital (ROIC) continued to be impacted by lower earnings
Return on Invested Capital (ROIC) continued to be impacted by lower earnings 12.4% rep. Long-term value creation based on accretive acquisitions and organic growth 8.6% 2018 positive impact 7.8% 8.0% adj. 8.0% adj. from Sound divestiture 7.1% 6.6%adj. 2019 negative impact from NxStage acquisit
Slide 39: 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 Q1 Q2 Q3 Q4 Full year FY 2022 FY 2021 FY 2020 2022 77 78 79 79 313 €:USD Period end 1.067 1.133 1.227 2021 77 78 79 79 313 Average 1.053 1.183 1.142 2020 77 78 79 79 313 2019 76 78 79 80 313 €:C
Slide 40: Patients, treatments, clinics
Patients, treatments, clinics as of December 31, 2022 as of December 31, 2021 Patients Treatments Clinics Patients Treatments Clinics North America 208,310 31,788,799 2,683 209,291 32,334,280 2,695 Growth in % 0 (2) 0 0 (2) 2 EMEA 66,063 9,941,735 795 65,599 9,885,319 821 Growth in % 1 1 (3) (1) (3)
Slide 41: Enhance quality of care | New global quality measurement
Enhance quality of care | New global quality measurement Indicators for patient well-being and treatment success Indication 2021 2022 Days in hospital per patient year Impact on health care costs and patient outcomes 10.7 10.6 Quality index in percent Patient well-being and treatment success n/a 81
Slide 42: Continuous monitoring of clinical performance to enhance care
Continuous monitoring of clinical performance to enhance care Index components Demographic indicators Dialysis effectiveness Strategy Measures how sufficiently the body is cleansed of waste substances Consistent global approach to pursuit equity and standardization of care across Vascular access Q
Slide 43: Conferences & Management
Financial calendar Date Event Reporting April 19, 2023 Capital Market Day (virtual) & AGM May 9, 2023 Report on 1st quarter 2023: Earnings Release and Conference Call May 16, 2023 Annual General Meeting May 9-11, 2023 BofA Securities 2023 Health Care Conference, Las Vegas May 17 – 18, 2023 Best of E
Slide 44: Contacts
Contacts FME Investor Relations Dr. Dominik Heger Robert Adolph Else-Kröner-Str. 1 Head of Investor Relations, Vice President 61352 Bad Homburg v. d. H. Strategic Development & Investor Relations Germany Communications | EVP Ticker: FME or FMS (NYSE/ADR) +49(0) 6172-609-2601 +49(0) 6172-609-2477 dom
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