03.05.2016
Fresenius Medical Care AG & Co. KGaA DE0005785802
DGAP-News: Fresenius Medical Care AG & Co. KGaA reports strong start to the year 2016
DGAP-News: Fresenius Medical Care AG & Co. KGaA / Key word(s): Quarterly /
Interim Statement
Fresenius Medical Care AG & Co. KGaA reports strong start to the year 2016
03.05.2016 / 07:21
The issuer is solely responsible for the content of this announcement.
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May 3, 2016
INVESTOR
NEWS
First quarter 2016
/
Fresenius Medical Care reports strong start to the year 2016
- Group revenue increased +6%, strong net income growth of +9%
- North America: revenue +10%, significant increase of operating income
(EBIT) +28%
- Segments outside North America strongly influenced by currency
- Care Coordination with strong organic growth of +17%
- First quarter performance in line to achieve full year guidance
First quarter 2016 key figures:
Net revenue $4,205 million +6%
Operating income $540 million +7%
Net income attributable to shareholders
of Fresenius Medical Care AG & Co. KGaA $228 million +9%
Basic earnings per share $0.75 +8%
Rice Powell, Chief Executive Officer of Fresenius Medical Care stated: "We
had a strong start to the year. Our core dialysis service and products
business showed a very strong underlying growth globally. While our
businesses outside the United States were largely influenced by currency,
the North American market delivered a very satisfying result. In addition,
Care Coordination continues to show strong topline growth. We are investing
in our future growth in this area, but also expect the profitability to
improve again in the course of the year. We are on track to achieve our
full year guidance for 2016."
Revenue & Earnings
Net revenue for the company improved by 6% and reached $4,205 million (+9%
at constant currency), largely driven by strong Net Health Care revenue
growth of +10% in North America. Net Health Care revenue contributed a 7%
increase to $3,414 million, while product revenue grew 2% (6% at constant
currency) to $791 million. Solid organic growth rates of 7% for Net Health
Care as well as for the products business demonstrated a solid business
performance. The development was primarily driven by higher revenue per
treatment and more dialysis days.
Total operating income (EBIT) increased by 7% to $540 million (margin of
12.8%). This increase was driven by lower costs for Health Care supplies, a
favorable impact from higher volume with commercial payors and further
efficiency gains partially offset by higher personnel expense related to
dialysis services in the North America segment, unfavourable foreign
exchange effects in all segments outside North America as well as higher
legal and consulting expenses.
Net income attributable to shareholders of Fresenius Medical Care AG & Co.
KGaA for the first quarter of 2016 was $228 million, a strong increase of
9% compared to $210 million of last year's first quarter. Based on a number
of approximately 305.3 million shares (weighted average number of shares
outstanding), basic earnings per share (EPS) for the first three months
2016 amounted to $0.75, compared to $0.69 for the first quarter of 2015.
Segment development
North America revenue increased by 10% to $3,044 million (72% of total
revenue). Dialysis business grew by 8%, Care Coordination increased by 20%.
The continued progress in Care Coordination was driven by organic growth of
+17% and reached $522 million in revenues. Dialysis growth was positively
influenced by a higher volume with commercial payors, two more dialysis
days and increased product sales (especially machines and dialyzers).
The substantially improved dialysis operating income margin of 16.9% (+300
basis points compared to Q1 2015) was due to lower costs from Health Care
supplies, a favourable impact from commercial payors as well as decreased
legal expenses. Total operating income (EBIT) for the quarter under review
was $436 million, an impressive increase of 28%. Total operating income
margin improved to 14.3%.
EMEA revenue increased by 5% to $631 million at constant currency. Positive
business movements from an increase in dialysis treatments were offset by
the negative currency impact, especially due to the strong US Dollar. Also
product revenue came in with a 5% plus at constant currency ($330 million)
due to increased sales of bloodlines, products for acute care treatments
and hemodialysis solutions and concentrates. Operating income of $130
million in Q1 2016 was negatively impacted mainly due to the weakening of
various local currencies.
Asia Pacific grew by 10% at constant currency to $374 million. The region
recorded $168 million in Net Health Care revenue, based on an increase of
6% in dialysis treatments. With a growth of +16% at constant currency to
$206 million, the product business showed a very strong sales performance
in dialysers, bloodlines, machines and peritoneal dialysis products.
Operating income decreased to $65 million (-23%) and was impacted by
unfavorable foreign exchange effects, increased costs related to further
sales development and costs associated with changes in the Management
Board.
Latin America delivered revenue of $153 million, an improvement of 5% at
constant currency (-23% on a reported basis). In addition to the negative
currency impact, the business was mainly influenced by clinics sold in
Venezuela in 2015. Dialysis treatments decreased accordingly by 6%. Product
revenue decreased by 4% at constant currency to $40 million. Operating
income was at $11 million, compared to $18 million in Q1 2015. Operating
income margin decreased to 7.1% in Q1 2016 from 9.0% in Q1 2015 mainly due
to higher costs related to inflation, unfavorable foreign exchange effects
and an unfavorable impact from manufacturing production costs, partially
offset by the impact from prior year lower margin dialysis service business
in Venezuela which was subsequently divested in the third quarter of 2015.
Net interest expense in Q1 2016 was $105 million compared to $102 million
in the first quarter of 2015. The slight increase is based on a lower
interest income as a result of the repayment of interest bearing notes
receivables. Income tax expense was $138 million for the first quarter of
2016, which translates into an effective tax rate of 31.8%, substantially
lower than in Q1 2015 (34.3%). This was primarily driven by increased
tax-free income attributable to noncontrolling interest in the US and lower
tax rates in other jurisdictions.
Cash flow
In the first quarter of 2016, the company generated $180 million in net
cash provided by operating activities, representing 4% of revenue, compared
to $447 million in last year's Q1. The lower level was driven by an
adjustment in invoicing within the quarter and the timing of cash payroll
payments in the US. The number for DSO (days sales outstanding) increased
accordingly to 74 days (71 days in Q1 2015). These timing effects will have
no meaningful impact on the full year 2016.
Employees
As of March 31, 2016, Fresenius Medical Care had 104,687 employees
(full-time equivalents) worldwide, compared to 101,543 employees at the end
of March 2015. This increase was mainly attributable to our continued
organic growth.
Outlook 2016 confirmed
Based on the positive Q1 business development, Fresenius Medical Care
confirms its full year outlook 2016. The company expects a
currency-adjusted revenue growth between +7% and +10% for 2016. Net income
attributable to shareholders of Fresenius Medical Care AG & Co. KGaA is
expected to increase by +15% to +20% over the previous year.
Conference call
Fresenius Medical Care will hold a conference call to discuss the results
of the first quarter 2016 on Tuesday, May 3, 2016 at 3.30 p.m. CEDT/ 9.30
a.m. EDT. The company invites investors to follow the live webcast of the
call at the company's website www.freseniusmedicalcare.com in the
"Investors/Events" section. A replay will be available shortly after the
call.
Please refer to our statement of earnings included at the end of this news
and to the attachments as separate excel- and PDF-files for a complete
overview of the results for the first quarter 2016.
Fresenius Medical Care is the world's largest integrated provider of
products and services for individuals undergoing dialysis because of
chronic kidney failure, a condition that affects more than 2.8 million
individuals worldwide. Through its network of 3,432 dialysis clinics in
North America, Europe, Latin America, Asia-Pacific and Africa, Fresenius
Medical Care provides dialysis treatments for 294,043 patients around the
globe. Fresenius Medical Care is also the world's leading provider of
dialysis products such as hemodialysis machines, dialyzers and related
disposable products.
For more information visit the Company's website at
www.freseniusmedicalcare.com.
Disclaimer
This release contains forward-looking statements that are subject to
various risks and uncertainties. Actual results could differ materially
from those described in these forward-looking statements due to certain
factors, including changes in business, economic and competitive
conditions, regulatory reforms, foreign exchange rate fluctuations,
uncertainties in litigation or investigative proceedings, and the
availability of financing. These and other risks and uncertainties are
detailed in Fresenius Medical Care AG & Co. KGaA's reports filed with the
U.S. Securities and Exchange Commission. Fresenius Medical Care AG & Co.
KGaA does not undertake any responsibility to update the forward-looking
statements in this release.
CONTACT
Fresenius Medical Care AG & Co. KGaA
Investor Relations
61352 Bad Homburg v. d. H.
Germany
www.freseniusmedicalcare.com
Oliver Maier
Head of Investor Relations &
Corporate Communications
Tel. +49 6172 609 2601
Fax +49 6172 609 2301
email: [email protected]
Published by
Fresenius Medical Care AG & Co. KGaA
Investor Relations
Annual reports, interim reports and further
information on the company are also available on our website.
Please visit us at www.freseniusmedicalcare.com
For printed material, please contact Investor Relations.
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03.05.2016 Dissemination of a Corporate News, transmitted by DGAP - a
service of EQS Group AG.
The issuer is solely responsible for the content of this announcement.
The DGAP Distribution Services include Regulatory Announcements,
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Media archive at www.dgap-medientreff.de and www.dgap.de
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Language: English
Company: Fresenius Medical Care AG & Co. KGaA
Else-Kröner-Straße 1
61352 Bad Homburg
Germany
Phone: +49 (0) 6172- 609 2525
Fax: +49 (0) 6172- 609 2301
E-mail: [email protected]
Internet: www.freseniusmedicalcare.com
ISIN: DE0005785802, ,
WKN: 578580, 578583
Indices: DAX
Listed: Regulated Market in Frankfurt (Prime Standard); Regulated
Unofficial Market in Berlin, Dusseldorf, Hamburg, Hanover,
Munich, Stuttgart; Terminbörse EUREX; NYSE
End of News DGAP News Service
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460071 03.05.2016
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