Fresenius Medical Care Ag · XETR:FME
Fresenius Medical Care — Q3 2024 Earnings Presentation
43 slides from Fresenius Medical Care's earnings presentation, November 2024
Slide 1: Fresenius Medical Care AG Investor Presentation Q3 2024
Fresenius Medical Care AG Investor Presentation Q3 2024
Slide 2: Safe harbor statement
Safe harbor statement: In this Safe harbor statement, “the Company” and “Fresenius Medical Care” refer to Fresenius Medical Care AG & Co. KGaA, a German partnership limited by shares, prior to its conversion of legal form, and to Fresenius Medical Care AG, a German stock corporation, after its conve
Slide 3: Agenda
1 Markets and growth drivers 2 Execution against strategic plan 3 Q3 2024 Business Update 4 Outlook
Slide 4: We are the leading kidney care company globally
We are the leading kidney care company globally Care Delivery | ~80% of total revenue Care Enablement | ~20% of total revenue Largest dialysis services network globally Market leader with products serving around half of the world’s dialysis patients Around 72 ~3,700 308,000 Net Promoter dialysis cen
Slide 5: Underlying business fundamentals intact | Extrapolation from 2020 to 2035
Underlying business fundamentals intact | Extrapolation from 2020 to 2035 Ageing global population Hypertension Diabetes Dialysis patients One out of four people +60% worldwide has hypertension2 +40% +100% Global population People living People on maintenance aged 65+1 with diabetes3 dialysis4 0.75
Slide 6: GLP-1 medications' assumed effects on the kidney disease population
GLP-1 medications’ assumed effects on the kidney disease population ESRD patients with significant co-morbidity Overall, GLP-1 medications are expected to burden have a balanced impact on ESRD patient volumes Expected long-term impact Cardio- Diabetes vascular ▪ GLP-1 help control T2D with proven be
Slide 7: Returning to solid patient volume development looking forward
Returning to solid patient volume development looking forward U.S. dialysis U.S. patient volume growth treatment expected to return to pre- expectations pandemic levels by 2025+ 2024 ▪ Improving patient health and mortality trends are greatest contributors to growing flat to +0.5% patient volumes an
Slide 8: Strategic growth drivers | Value-based care and home dialysis
Strategic growth drivers | Value-based care and home dialysis Market leader transforming U.S. value-based care Market leader further expanding U.S. home dialysis industry ▪ Premier value-based care capabilities addressing growing population of ▪ Accelerating shift to home dialysis CKD and ESRD patie
Slide 9: Continuous monitoring of clinical performance to enhance care
Continuous monitoring of clinical performance to enhance care Quality index components Dialysis effectiveness Measures how sufficiently the body is cleansed of waste substances Vascular access Quality index Measures the share of patients who do not receive dialysis via a dialysis catheter but Global
Slide 10: Our commitment to sustainability: Purpose driven. Patient-centric.
Our commitment to sustainability: Purpose driven. Patient-centric. Progress in our strategic focus areas Enhance quality of Build the Reduce our care and access to best team to environmental health care serve patients footprint High patient satisfaction Diversity in leadership Emissions reduction 72
Slide 11: Agenda: Execution against strategic plan
1 Markets and growth drivers 2 Execution against strategic plan 3 Q3 2024 Business Update 4 Outlook
Slide 12: 2023 | Delivering on commitment in a year of fundamental transformation
2023 | Delivering on commitment in a year of fundamental transformation Successful Leadership Portfolio operational changes optimization turnaround Delivered organic New CFO, new Divested non-core growth and operational CD head and new assets and turnaround Board Member for discontinued Legal, Compl
Slide 13: FME25 | On track to reach upper end of full year 2024 savings target
FME25 | On track to reach upper end of full year 2024 savings target range Sustainable annual savings +650 p.a. +650 p.a. ▪ Transformation program introduced in in € million More than More than 2021 and savings target extended to EUR +520 +100 650m by 2025 More than +346 +150 ▪ EUR 346m of sustainab
Slide 14: Portfolio | Further divestitures closed as execution of plan continues
Portfolio | Further divestitures closed as execution of plan continues Portfolio optimization plan as presented Divestments of non-core and margin dilutive assets as part of ongoing portfolio optimization plan Closed divestments o CD and CE operations in Argentina ✓ o CD operations in Chile, Ecuador
Slide 15: Use of cash | Disciplined financial policy strictly followed
Use of cash | Disciplined financial policy strictly followed ▪ Strong progress on deleveraging with net financial leverage ratio currently at 2.8x, below self-imposed range of 3.0x to 3.5x Deleveraging ▪ Proceeds from divestments used for ongoing deleveraging ▪ Committed to investment grade rating;
Slide 16: Innovation | FME bringing a new standard of care to the U.S.
Innovation | FME bringing a new standard of care to the U.S. with expansion of High-Volume Hemodiafiltration (HDF) Leveraging benefits of an integrated company Timeline for U.S. launch ▪ 2023 | EU’s CONVINCE Study demonstrates Care Delivery 23% reduction in mortality ▪ Opportunity to positively affe
Slide 17: Agenda: Q3 2024 Business Update
1 Markets and growth drivers 2 Execution against strategic plan 3 Q3 2024 Business Update 4 Outlook
Slide 18: Q3 2024 | Key developments at Group level
Q3 2024 | Key developments at Group level ▪ Organic revenue growth of +1.9% supported by Care Enablement and Care Delivery ▪ Underlying U.S. same market treatment growth turned positive ▪ Exceeding full year FME25 savings target, with additional EUR 64 3 million contribution in Q3 ▪ Both segments fu
Slide 19: Q3 2024 | Continued operating margin focus takes effect
Q3 2024 | Continued operating margin focus takes effect Revenue | outlook base1 Operating income | outlook base1 in € million Margin in % 6.6% 8.9% 9.8% 9.7% -0.7% 4,936 4,855 outlook base1 4,820 +10.3% 4,760 in € million outlook base1 -81 +1.9% -60 474 463 organic 106 430 -5 -6 324 Q3 2023 Divest-
Slide 20: Q3 2024 | Group income margin growth driven by increased operating income in both segments
Q3 2024 | Group income margin growth driven by increased operating income in both segments Margin in % 8.9% 9.8% In € million 58 474 463 19 -6 106 430 -27 -5 -6 324 Q3 2023 Special Q3 2023 Care Care Inter- Corporate Q3 2024 Fx Special items Q3 2024 operating items & 2023 operating Delivery Enablemen
Slide 21: Q3 2024 | Care Delivery income driven by higher price and volume
Q3 2024 | Care Delivery income driven by higher price and volume Revenue | outlook base1 Operating income | outlook base1 in € million Margin in % in € million 10.5% outlook base1 11.2% -2.2% +4.6% 3,892 outlook base1 3,806 -55 427 408 66 8 +1.0% organic 3,186 3,211 Business FME25 Labor growth savin
Slide 22: Q3 2024 | Care Enablement delivers solid growth and structural margin expansion
Q3 2024 | Care Enablement delivers solid growth and structural margin expansion Revenue | outlook base1 Operating income | outlook base1 in € million Margin in % in € million +4.2% 1.5% outlook base1 5.6% outlook base1 1,330 1,386 +284% +4.2% organic -15 78 50 20 23 Q3 2023 Q3 2024 Q3 2023 Business
Slide 23: Q3 2024 | Lower net financial debt and further improved net leverage ratio
Q3 2024 | Lower net financial debt and further improved net leverage ratio in € million Q3 Q3 9M 9M 2024 2023 2024 2023 Key developments Operating cash flow 985 760 1,554 1,910 ▪ In Q3 2024, operating cash flow increased mainly due to the recovery of ▪ Capital expenditures, net -170 -134 -452 -430 c
Slide 24: Solid funding profile
Solid funding profile Diversified financing mix1 Prudent financial policy Commercial Paper 1% Sufficient liquidity reserve Schuldschein Loans 2% Other2 3% ▪ Undrawn ESG-linked Revolver Credit Facility of €2.0bn ▪ Committed bilateral credit lines of ~€670m, supplemented by further Lease Liabilities 3
Slide 25: Agenda: Outlook
1 Markets and growth drivers 2 Execution against strategic plan 3 Q3 2024 Business Update 4 Outlook
Slide 26: FY 2024 | Outlook confirmed
FY 2024 | Outlook confirmed FY 2024 Outlook Mid-term Outlook Low- to mid-single digit Revenue percent growth (outlook base)1 FY 2023 basis: EUR 19.0bn Group operating income margin 10% to 14% by 2025 16 – 18 percent growth Operating income Before: Mid- to high-teens percent growth (outlook base)1 FY
Slide 27: Target picture 2025+
Target picture 2025+ Partner of choice, setting the standard in kidney care with industry-leading returns Care Delivery Care Enablement Service provider of choice for patients, Profitably shape the global dialysis market physicians and payors across the with leading digital portfolio in renal therap
Slide 28: Appendix
Appendix
Slide 29: Path to margin improvement
Path to margin improvement 2022 operating 2025 operating income margin1 income margin2 Group 7.9% 10 % to 14% Care Delivery 9.5% 10 % to 14 % FME25 140 bps U.S. volume recovery 0 to 100 bps U.S. rate / mix development 100 to 175 bps Labor & inflation -175 to -50 bps Dilution from value-based care gr
Slide 30: 9M 2024 | Continued operating margin focus takes effect
9M 2024 | Continued operating margin focus takes effect Revenue | outlook base1 Operating income | outlook base1 in € million Margin in % 6.5% 8.2% 9.2% 8.0% +1.2% outlook base1 +13.3% 14,466 14,215 14,385 14,251 in € million outlook base1 -251 +2.9% -134 1,323 organic 225 1,167 -16 1,133 942 -174 9
Slide 31: 9M 2024 | Group income and income margin growth driven by both segments
9M 2024 | Group income and income margin growth driven by both segments Margin in % 8.2% 9.2% In € million 122 1,323 58 -4 -19 226 1,167 -16 1,133 -174 942 9M 2023 Special 9M 2023 Care Care Inter- Corporate 9M 2024 Fx Special items 9M 2024 operating items & 2023 operating Delivery Enablement segment
Slide 32: 9M 2024 | Care Delivery income driven by higher price and volume
9M 2024 | Care Delivery income driven by higher price and volume Revenue | outlook base1 Operating income | outlook base1 in € million Margin in % in € million 9.7% outlook base1 10.1% +0.5 +5.3% 11,347 outlook base1 11,408 44 222 -208 1,153 +2.7% 1,095 organic Business FME25 Labor/ 9,229 9,474 grow
Slide 33: 9M 2024 | Care Enablement delivers solid growth and structural margin expansion
9M 2024 | Care Enablement delivers solid growth and structural margin expansion Revenue | outlook base1 Operating income | outlook base1 in € million in € million Margin in % +3.2% 2.6% outlook base1 5.5% outlook base1 3,954 4,081 +119% +3.0% organic -43 -15 224 112 103 52 9M 2023 9M 2024 9M 2023 Bu
Slide 34: Q3 2024 | Profit and Loss
Q3 2024 | Profit and Loss Q3 2024 Q3 2023 Growth Growth € million € million in % in % cc Revenue 4,760 4,936 -4 -2 Revenue (outlook base)1 4,820 4,855 -1 Operating income 463 324 43 43 Operating income margin in % 9.7 6.6 Operating income (outlook base)1 474 430 10 Operating income margin (outlook b
Slide 35: 9M 2024 | Profit and Loss
9M 2024 | Profit and Loss 9M 2024 9M 2023 Growth Growth € million € million in % in % cc Revenue 14,251 14,466 -1 -1 Revenue (outlook base)1 14,385 14,215 1 Operating income 1,133 942 20 21 Operating income margin in % 8.0 6.5 Operating income (outlook base)1 1,323 1,167 13 Operating income margin (
Slide 36: 2023 base for 2024 targets, reconciliation adjustments
2023 base for 2024 targets, reconciliation adjustments Reconciliation of non-IFRS financial measures to the most directly comparable IFRS financial measures for comparison with outlook Inter-segment Group Care Delivery Care Enablement Corporate eliminations Growth Growth Growth € million Q3 2024 Q3
Slide 37: 2023 base for 2024 targets, reconciliation adjustments
2023 base for 2024 targets, reconciliation adjustments Reconciliation of non-IFRS financial measures to the most directly comparable IFRS financial measures for comparison with outlook Inter-segment Group Care Delivery Care Enablement Corporate eliminations 9M 9M Growth 9M 9M Growth 9M 9M Growth 9M
Slide 38: Debt
Debt Q3 2024 FY 2023 FY 2022 € million € million € million Debt Short-term debt from unrelated parties 104 457 644 + Short-term debt from related parties - - 4 + Current portion of long-term debt 943 487 694 + Current portion of lease liabilities from unrelated parties 574 593 650 + Current portion
Slide 39: 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. 8.6% 7.8% 8.0% adj. 8.0% adj. 7.1% 6.6%adj. 6.1% rep. 5.1% adj. 5.8% rep. 3.9% adj. 3.6% adj. 4.6% adj. 4.9% rep. 3.7% rep. 3.3% rep. 2.8% rep. 2015 2016 2017 2018 2019 2020 2021 2022 2023 Q3 2024 ▪ For the years
Slide 40: Patients, treatments, clinics
Patients, treatments, clinics as of September 30, 2024 as of September 30, 2023 Patients Treatments Clinics Patients Treatments Clinics United States 205,942 23,299,461 2,629 205,887 23,380,747 2,617 Growth in % 0 0 0 International 102,274 12,651,243 1,103 135,906 15,426,432 1,397 Growth in % -25 -1
Slide 41: Segment information for FY 2021, 2022 and 2023
Segment information for FY 2021, 2022 and 2023 Growth Organic Growth Organic € million; % change year-over-year FY 2023 Growth FY 2022 Growth FY 2021 at cc growth at cc growth Total Revenue 19,454 0 5 4 19,398 10 2 2 17,619 Operating income 1,369 -9 -7 1,512 -18 -25 1,852 Operating income margin in
Slide 42: IR event calendar
IR event calendar Date Event February 25, 2025 Report on Q4/FY 2024: Earnings Release and Conference Call Reporting AGM May 6, 2025 Report on Q1 2025: Earnings Release and Conference Call & May 22, 2025 Annual General Meeting August 5, 2025 Report on Q2 2025: Earnings Release and Conference Call CMD
Slide 43: Contacts
Contacts Fresenius Medical Care AG Investor Relations Else-Kröner-Str. 1 61352 Bad Homburg v. d. H. Germany Dr. Dominik Heger Ilia Kuerten Alicia Cahill Head of Investor Relations Vice President Senior Director ir@freseniusmedicalcare.com and Investor Relations Investor Relations Head of Investor
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