Fresenius Medical Care AG & Co. KGaA (FMS)
Filed: 30 Jul 08, 12:00am
Exhibit 99.1
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Investor News | Fresenius Medical Care AG & Co. KGaA |
| Investor Relations |
| Else-Kröner-Str. 1 |
| D-61352 Bad Homburg |
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| Contact: |
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| Oliver Maier |
| Phone: + 49 6172 609 2601 |
| Fax: + 49 6172 609 2301 |
| E-mail: ir@fmc-ag.com |
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| North America: |
| Terry L. Morris |
| Phone: + 1 800 948 2538 |
| Fax: + 1 615 345 5605 |
| E-mail: ir@fmc-ag.com |
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| Internet:www.fmc-ag.com |
July 30, 2008
Fresenius Medical Care Confirms Outlook for 2008;
Reports Strong Second Quarter and Half Year Results
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Summary Second Quarter 2008: |
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Net revenue |
| $ | 2,665 million |
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| + 11 | % |
Operating income (EBIT) |
| $ | 429 million |
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| + 10 | % |
Net income |
| $ | 211 million |
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| + 18 | % |
Earnings per share |
| $ | 0.71 |
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| + 18 | % |
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Summary First Half 2008: |
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Net revenue |
| $ | 5,177 million |
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| + 10 | % |
Operating income (EBIT) |
| $ | 818 million |
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| + 8 | % |
Net income |
| $ | 397 million |
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| + 17 | % |
Earnings per share |
| $ | 1.34 |
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| + 17 | % |
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Fresenius Medical Care AG & Co. KGaA, July 30, 2008 | 1 of 17 |
Bad Homburg, Germany – Fresenius Medical Care AG & Co. KGaA (“the Company”), the world’s largest provider of Dialysis Products and Services, today announced its results for the second quarter and first half of 2008.
Second Quarter 2008:
Revenue
Net revenue for the second quarter of 2008 increased by 11% to $2,665 million (7% at constant currency) compared to the second quarter of 2007.Organic revenue growth worldwide was 7%. Dialysis Services revenue grew by 7% to $1,924 million (5% at constant currency) in the second quarter of 2008. Dialysis Product revenue increased by 22% to $741 million (12% at constant currency) in the same period.
North Americarevenue increased by 3% to $1,715 million. Organic revenue growth was 4%. Dialysis Services revenue grew by 2% to $1,533 million. Excluding the effects of the divestiture of the perfusion business in spring 2007, Dialysis Services revenue increased by 3%. Average revenue per treatment for the U.S. clinics was unchanged at $327 in the second quarter of 2008 compared to $327 for the same quarter in 2007 and $326 for the first quarter of 2008. The sequential improvement in the revenue per treatment during the second quarter of 2008 compared to the first quarter of 2008 was due to an increase in EPO utilization. The Average Selling Price (ASP) for EPO in the second quarter of 2008 remained approximately 5% less than second quarter of 2007 pricing.Dialysis Product revenue increased by 13% to $182 million. This performance was led by strong sales among the whole product portfolio including the phosphate binding drug PhosLo®.
Internationalrevenue was $950 million, an increase of 28% (14% at constant currency) compared to the second quarter of 2007. Organic revenue growth in the International segment was 14%. Dialysis Services revenue reached $391 million, an increase of 32% (19% at constant currency). Dialysis Product revenue rose 25% to $559 million (11% at constant currency), led by strong dialyzer and dialysis machine sales.
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Fresenius Medical Care AG & Co. KGaA, July 30, 2008 | 2 of 17 |
Earnings
Operating income (EBIT)increased by 10% to $429 million compared to $391 million in the second quarter of 2007 resulting in an operating margin of 16.1% compared to 16.3% for the second quarter 2007. This margin decrease mainly reflected the increased expenditures for our research and development activities. The strong underlying business was supported by increased reimbursement rates, dialysis services cost containment and a continued strong performance of renal products including PhosLo®. This was partially offset by a reduction in reimbursement and a lower utilization of EPO as well as start-up of new clinics and increased costs for the anticoagulant drug Heparin due to suspension of production by the principal manufacturer.
Net interest expense for the second quarter of 2008 was $82 million compared to $92 million in the same quarter of 2007. This positive development was mainly attributable to lower average interest rates associated with changes in the financing structure due to the redemption of a portion of the Trust Preferred Securities.
Income tax expense was $129 million for the second quarter of 2008 compared to $113 million in the second quarter of 2007, reflecting effectivetax rates of 37.2% and 38.0%, respectively.
Net income for the second quarter 2008 was $211 million, an increase of 18%.
Earnings per share (EPS) for the second quarter of 2008 rose 18% to $0.71 per ordinary share compared to $0.60 for the second quarter of 2007. Earnings per ordinary American Depository Share (ADS) are equivalent as one ADS represents one share as a result of the change in ratio of the Company’s ordinary shares and preference shares to ADSs. The weighted average number of shares outstanding for the second quarter of 2008 was approximately 296.7 million shares compared to 295.4 million shares for the second quarter of 2007. The increase in shares outstanding is due to stock option exercises in 2007 and also in the first half of 2008.
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Fresenius Medical Care AG & Co. KGaA, July 30, 2008 | 3 of 17 |
Cash Flow
In the second quarter of 2008, the Company generated $209 million incash from operations, representing 8% of revenue. The cash flow generation was impacted by increases in inventory and other working capital.
A total of $179 million was spent forcapital expenditures, net of disposals.Free Cash Flow before acquisitions was $30 million compared to $95 million in the second quarter of 2007. A total of $58 million in cash was used foracquisitions,net of divestitures.
First Half of 2008:
Revenue and Earnings
Net revenue was $5,177 million, up 10% from the first half of 2007. At constant currency, net revenue rose 6%. Organic growth was 6% in the first six months of 2008.
Operating income (EBIT)increased by 8% to $818 million compared to $756 million in the first half of 2007, resulting in an operating margin of 15.8% compared to 16.0% for the first half of 2007. This development mainly reflected higher research and development expenses. Reduced reimbursement rates for EPO and lower utilization of EPO as well as start-up cost for new clinics were offset by increases in underlying reimbursement rates, cost containment and contributions from product sales.
Net interest expense for the first six months of 2008 was $165 million compared to $187 million in the same period of 2007. The reduction was mainly due to lower average interest rates associated with changes in our financing structure.
Income tax expense was $243 million in the first half of 2008 compared to $216 million in the same period in 2007, reflectingtax rates of 37.2% and 38.0%, respectively.
For the first half of 2008,net income was $397 million, up 17% from the first half of 2007.
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Fresenius Medical Care AG & Co. KGaA, July 30, 2008 | 4 of 17 |
In the first six months of 2008,Earnings per ordinary share rose 17% to $1.34. The weighted average number of shares outstanding during the first half of 2008 was approximately 296.6 million.
Cash Flow
Cash from operations during the first six months of 2008 was $401 million compared to $508 million for the same period in 2007. Cash Flow generation was impacted by higher DSO and increased inventory partially offset by increased earnings.
A total of $332 million was used forcapital expenditures, net of disposals.Free Cash Flow before acquisitions for the first six months of 2008 was $69 million compared to $271 million in same period in 2007. A total of $92 million in cash was used foracquisitions, net of divestitures.
Please refer to the attachments for a complete overview on the second quarter and first half of 2008 and the reconciliation of non-GAAP financial measures included in this release to the most comparable GAAP financial measures.
Patients – Clinics – Treatments
As of June 30, 2008, Fresenius Medical Care treated 179,340 patients worldwide, which represents a 4% increase compared to last year. North America provided dialysis treatments for 123,784 patients, an increase of 3%. Including 32 clinics managed by Fresenius Medical Care North America, the number of patients in North America was 125,559. The International segment served 55,556 patients, an increase of 8% over last year.
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Fresenius Medical Care AG & Co. KGaA, July 30, 2008 | 5 of 17 |
As of June 30, 2008, the Company operated a total of 2,318clinics worldwide. This is comprised of 1,647 clinics in North America, an increase of 4%, and 671 clinics in the International segment, an increase of 7%.
Fresenius Medical Care delivered approximately 13.6 million dialysistreatments worldwide during the first six months of 2008. This represents an increase of 5% year over year. North America accounted for 9.39 million treatments, an increase of 3%, and the International segment delivered 4.22 million treatments, an increase of 8% over last year.
Employees
As of June 30, 2008, Fresenius Medical Care had 63,197 employees (full-time equivalents) worldwide compared to 61,406 employees at the end of 2007.
Debt/EBITDA Ratio
The ratio of debt to Earnings before Interest, Taxes and Amortization (EBITDA) decreased from 3.03 at the end of the second quarter of 2007 to 2.86 at the end of the second quarter 2008.
Credit Ratings
In March 2008, Standard & Poor’s assigned debt and recovery ratings for Fresenius Medical Care AG & Co. KGaA’s unsecured debt issues. Based on a recovery analysis, the rating of Trust Preferred Securities IV ($225 million) and Trust Preferred Securities V (€300 million) improved to BB from single B+. Additionally the rating of the $500 million Senior Notes due 2017 improved from BB- to BB+. In July 2008, in connection with of Fresenius SE acquisition of APP, Standard & Poor’s revised its outlook from positive to negative. At the same time, all ratings, including the BB long-term corporate ratings, were affirmed.
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Fresenius Medical Care AG & Co. KGaA, July 30, 2008 | 6 of 17 |
In May 2008, Moody’s raised both the corporate and the Debt Instruments’ Rating of Fresenius Medical Care AG & Co. KGaA. The corporate Credit Rating improved from Ba2 to Ba1. The Senior Secured Debt under the $4.6 billion Credit Agreement received a Baa3 Investment Grade Rating. The Rating for the Unsecured $500 million Senior Notes due 2017 was raised from Ba3 to Ba2. The Ratings for the Trust Preferred Securities IV ($225 million) and Trust Preferred Securities V (€300 million) were raised from B1 to Ba3. A stable outlook was assigned to all Ratings.
Outlook for 2008
For the full year of 2008, the Company confirms its outlook and expects to achieverevenue of more than $10.4 billion, an increase of more than 7%.
Net incomeis projected to be between $805 million and $825 million in 2008, an increase of 12% to 15%.
In addition, the Company expects to spend $650 to $750 million oncapital expendituresand $150 to $250 million onacquisitions. Thedebt/EBITDA ratiois projected to decrease to below 2.8 by the end of 2008.
For 2010, Fresenius Medical Care continues to expect revenue of more than $11.5 billion. Earnings after tax are projected to grow in the low- to mid-teens each year.
Ben Lipps, Chief Executive Officer of Fresenius Medical Care, commented:
“We are pleased to report a strong second quarter and first half of the year 2008 in an overall challenging environment. All business segments and regions have contributed to our strong performance. This gives us the opportunity to confirm our guidance for the full year of 2008. In 2008, we have continued to make selective acquisitions, increase our research and development efforts and expand our production capacity. We are pleased with our new pharmaceutical partnership for I.V. Iron as part of our renal pharma initiative. These investments position us to continue to lead the industry in quality and efficiency and with the emerging pay for performance concepts in the service area, Fresenius Medical Care is well prepared for future growth.”
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Fresenius Medical Care AG & Co. KGaA, July 30, 2008 | 7 of 17 |
Conference Call
Fresenius Medical Care will hold a conference call to discuss the results of the second quarter and the first half year of 2008 on Wednesday, July 30, 2008, at 3:30 pm CEDT / 9:30 am EDT. The Company invites investors to view the live webcast of the conference call at the Company’s websitewww.fmc-ag.com in the “Investor Relations” section. A replay will be available shortly after the call.
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 1,600,000 individuals worldwide. Through its network of 2,318 dialysis clinics in North America, Europe, Latin America, Asia-Pacific and Africa, Fresenius Medical Care provides dialysis treatment to 179,340 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. Fresenius Medical Care is listed on the Frankfurt Stock Exchange (FME, FME3) and the New York Stock Exchange (FMS, FMS/P). For more information about Fresenius Medical Care visit the Company’s website at www.fmc-ag.com.
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.
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Fresenius Medical Care AG & Co. KGaA, July 30, 2008 | 8 of 17 |
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Fresenius Medical Care |
| Three Months Ended |
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| Six Months Ended |
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in US-$ thousands, except share and per share data (unaudited) |
| 2008 |
| 2007 |
| % Change |
| 2008 |
| 2007 |
| % Change |
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Net revenue |
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Dialysis Care |
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| 1,924,259 |
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| 1,795,544 |
| 7.2 | % |
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| 3,768,546 |
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| 3,555,898 |
| 6.0 | % |
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Dialysis Products |
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| 741,037 |
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| 608,669 |
| 21.7 | % |
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| 1,408,474 |
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| 1,168,986 |
| 20.5 | % |
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Total net revenue |
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| 2,665,296 |
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| 2,404,213 |
| 10.9 | % |
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| 5,177,020 |
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| 4,724,884 |
| 9.6 | % |
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Cost of revenue |
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| 1,741,410 |
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| 1,566,826 |
| 11.1 | % |
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| 3,397,835 |
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| 3,103,146 |
| 9.5 | % |
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Gross profit |
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| 923,886 |
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| 837,387 |
| 10.3 | % |
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| 1,779,185 |
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| 1,621,738 |
| 9.7 | % |
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Selling, general and administrative |
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| 474,187 |
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| 431,772 |
| 9.8 | % |
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| 921,697 |
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| 838,091 |
| 10.0 | % |
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Research and development |
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| 20,654 |
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| 14,565 |
| 41.8 | % |
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| 39,772 |
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| 27,907 |
| 42.5 | % |
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Operating income (EBIT) |
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| 429,045 |
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| 391,050 |
| 9.7 | % |
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| 817,716 |
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| 755,740 |
| 8.2 | % |
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Interest income |
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| (7,419 | ) |
| (6,761 | ) | 9.7 | % |
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| (12,799 | ) |
| (10,343 | ) | 23.7 | % |
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Interest expense |
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| 89,561 |
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| 98,336 |
| -8.9 | % |
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| 177,759 |
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| 196,829 |
| -9.7 | % |
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Interest expense, net |
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| 82,142 |
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| 91,575 |
| -10.3 | % |
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| 164,960 |
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| 186,486 |
| -11.5 | % |
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Earnings before income taxes and minority interest |
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| 346,903 |
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| 299,475 |
| 15.8 | % |
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| 652,756 |
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| 569,254 |
| 14.7 | % |
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Income tax expense |
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| 128,990 |
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| 113,781 |
| 13.4 | % |
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| 243,087 |
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| 216,347 |
| 12.4 | % |
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Minority interest |
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| 6,825 |
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| 7,014 |
| -2.7 | % |
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| 12,708 |
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| 13,949 |
| -8.9 | % |
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Net income |
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| 211,088 |
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| 178,680 |
| 18.1 | % |
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| 396,961 |
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| 338,958 |
| 17.1 | % |
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Operating income (EBIT) |
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| 429,045 |
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| 391,050 |
| 9.7 | % |
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| 817,716 |
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| 755,740 |
| 8.2 | % |
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Depreciation and amortization |
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| 102,238 |
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| 85,581 |
| 19.5 | % |
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| 198,864 |
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| 170,492 |
| 16.6 | % |
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EBITDA |
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| 531,283 |
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| 476,631 |
| 11.5 | % |
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| 1,016,580 |
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| 926,232 |
| 9.8 | % |
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Total bad debt expenses |
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| 52,502 |
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| 50,954 |
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| 101,648 |
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| 99,635 |
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Earnings per ordinary share |
| $ | 0.71 |
| $ | 0.60 |
| 17.7 | % |
| $ | 1.34 |
| $ | 1.15 |
| 16.6 | % |
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Earnings per ordinary ADS |
| $ | 0.71 |
| $ | 0.60 |
| 17.7 | % |
| $ | 1.34 |
| $ | 1.15 |
| 16.6 | % |
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Weighted average number of shares |
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Ordinary shares |
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| 292,882,696 |
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| 291,645,531 |
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| 292,834,639 |
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| 291,548,143 |
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Preference shares |
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| 3,788,021 |
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| 3,720,652 |
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| 3,783,922 |
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| 3,718,463 |
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Percentages of revenue |
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Cost of revenue |
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| 65.3 | % |
| 65.2 | % |
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| 65.6 | % |
| 65.7 | % |
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Gross profit |
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| 34.7 | % |
| 34.8 | % |
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| 34.4 | % |
| 34.3 | % |
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Selling, general and administrative |
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| 17.8 | % |
| 18.0 | % |
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| 17.8 | % |
| 17.7 | % |
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Research and development |
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| 0.8 | % |
| 0.6 | % |
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| 0.8 | % |
| 0.6 | % |
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Operating income (EBIT) |
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| 16.1 | % |
| 16.3 | % |
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| 15.8 | % |
| 16.0 | % |
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Interest expense, net |
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| 3.1 | % |
| 3.8 | % |
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| 3.2 | % |
| 3.9 | % |
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Earnings before income taxes and minority interest |
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| 13.0 | % |
| 12.5 | % |
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| 12.6 | % |
| 12.0 | % |
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Income tax expense |
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| 4.8 | % |
| 4.7 | % |
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| 4.7 | % |
| 4.6 | % |
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Minority interest |
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| 0.3 | % |
| 0.3 | % |
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| 0.2 | % |
| 0.3 | % |
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Net income |
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| 7.9 | % |
| 7.4 | % |
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| 7.7 | % |
| 7.2 | % |
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EBITDA |
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| 19.9 | % |
| 19.8 | % |
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| 19.6 | % |
| 19.6 | % |
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Fresenius Medical Care AG & Co. KGaA, July 30, 2008 | 9 of 17 |
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Fresenius Medical Care |
| Three Months Ended |
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| Six Months Ended |
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in US-$ million |
| 2008 |
| 2007 |
| % Change |
| 2008 |
| 2007 |
| % Change |
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Net revenue |
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North America |
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| 1,715 |
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| 1,660 |
| 3.3 | % |
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| 3,382 |
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| 3,297 |
| 2.6 | % |
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International |
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| 950 |
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| 744 |
| 27.8 | % |
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| 1,795 |
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| 1,428 |
| 25.7 | % |
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Total net revenue |
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| 2,665 |
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| 2,404 |
| 10.9 | % |
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| 5,177 |
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| 4,725 |
| 9.6 | % |
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Operating income (EBIT) |
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North America |
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| 290 |
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| 285 |
| 1.8 | % |
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| 563 |
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| 543 |
| 3.5 | % |
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International |
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| 166 |
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| 130 |
| 28.2 | % |
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| 310 |
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| 251 |
| 23.7 | % |
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Corporate |
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| (27 | ) |
| (24 | ) | 15.6 | % |
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| (55 | ) |
| (38 | ) | 43.5 | % |
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Total operating income (EBIT) |
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| 429 |
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| 391 |
| 9.7 | % |
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| 818 |
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| 756 |
| 8.2 | % |
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Operating income in percentage of revenue |
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| �� |
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North America |
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| 16.9 | % |
| 17.2 | % |
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| 16.6 | % |
| 16.5 | % |
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International |
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| 17.5 | % |
| 17.5 | % |
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| 17.3 | % |
| 17.6 | % |
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Total |
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| 16.1 | % |
| 16.3 | % |
|
|
|
| 15.8 | % |
| 16.0 | % |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Employees |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Full-time equivalents (June 30 compared to Dec. 31) |
|
|
|
|
|
|
|
|
|
|
| 63,197 |
|
| 61,406 |
|
|
|
|
|
|
Fresenius Medical Care AG & Co. KGaA, July 30, 2008 | 10 of 17 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fresenius Medical Care |
| Three Months Ended |
|
| Six Months Ended |
| ||||||||
| ||||||||||||||
in US-$ million |
| 2008 |
| 2007 |
|
| 2008 |
| 2007 |
| ||||
|
|
|
|
|
|
|
|
|
|
| ||||
Segment information North America |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net revenue |
|
| 1,715 |
|
| 1,660 |
|
|
|
|
|
|
|
|
Costs of revenue and research and development |
|
| 1,149 |
|
| 1,109 |
|
|
|
|
|
|
|
|
Selling, general and administrative |
|
| 276 |
|
| 266 |
|
|
|
|
|
|
|
|
Costs of revenue and operating expenses |
|
| 1,425 |
|
| 1,375 |
|
|
|
|
|
|
|
|
Operating income (EBIT) |
|
| 290 |
|
| 285 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Percent of revenue |
|
| 16.9 | % |
| 17.2 | % |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dialysis Products revenue incl. and excl. internal sales |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
North America |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dialysis Products revenue incl. internal sales |
|
| 315 |
|
| 291 |
|
|
|
|
|
|
|
|
less internal sales |
|
| (133 | ) |
| (130 | ) |
|
|
|
|
|
|
|
Dialysis Products external sales |
|
| 182 |
|
| 161 |
|
|
|
|
|
|
|
|
International |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dialysis Products revenue incl. internal sales |
|
| 638 |
|
| 508 |
|
|
|
|
|
|
|
|
less internal sales |
|
| (79 | ) |
| (60 | ) |
|
|
|
|
|
|
|
Dialysis Products external sales |
|
| 559 |
|
| 448 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of cash flow from operating activities to EBITDA1) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total EBITDA |
|
|
|
|
|
|
|
|
| 1,017 |
|
| 926 |
|
Interest expense, net |
|
|
|
|
|
|
|
|
| (165 | ) |
| (186 | ) |
Income tax expense |
|
|
|
|
|
|
|
|
| (243 | ) |
| (216 | ) |
Change in working capital and other non cash items |
|
|
|
|
|
|
|
|
| (208 | ) |
| (16 | ) |
Net cash provided by operating activities |
|
|
|
|
|
|
|
|
| 401 |
|
| 508 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Annualized EBITDA2) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income (EBIT) last twelve months |
|
|
|
|
|
|
|
|
| 1,642 |
|
| 1,490 |
|
Depreciation and amortization last twelve months |
|
|
|
|
|
|
|
|
| 392 |
|
| 338 |
|
Non cash charges |
|
|
|
|
|
|
|
|
| 42 |
|
| 39 |
|
Annualized EBITDA |
|
|
|
|
|
|
|
|
| 2,076 |
|
| 1,867 |
|
1)EBITDA is the basis for determining compliance with certain covenants in Fresenius Medical Care’s long-term debt instruments.
2)EBITDA 2007: Excluding restructuring costs, in-process R&D and the gain from the sale of dialysis clinics.
|
|
Fresenius Medical Care AG & Co. KGaA, July 30, 2008 | 11 of 17 |
|
|
|
|
|
|
|
|
Fresenius Medical Care |
| June 30 |
| December 31, |
| ||
in US-$ million |
| 2008 |
| 2007 |
| ||
|
|
|
|
|
| ||
Assets |
|
|
|
|
|
|
|
Current assets |
| 4,196 |
|
| 3,859 |
|
|
Intangible assets |
| 8,096 |
|
| 7,936 |
|
|
Other non-current assets |
| 2,620 |
|
| 2,375 |
|
|
Total assets |
| 14,912 |
|
| 14,170 |
|
|
|
|
|
|
|
|
|
|
Shareholders’ equity and liabilities |
|
|
|
|
|
|
|
Current liabilities |
| 3,144 |
|
| 3,026 |
|
|
Long-term liabilities |
| 5,941 |
|
| 5,569 |
|
|
Shareholders’ equity |
| 5,827 |
|
| 5,575 |
|
|
Total Shareholders’ equity and liabilities |
| 14,912 |
|
| 14,170 |
|
|
|
|
|
|
|
|
|
|
Equity/assets ratio: |
| 39 | % |
| 39 | % |
|
|
|
|
|
|
|
|
|
Debt |
|
|
|
|
|
|
|
Short-term borrowings |
| 734 |
|
| 217 |
|
|
Short-term borrowings from related parties |
| 181 |
|
| 2 |
|
|
Current portion of long-term debt and capital lease obligations |
| 151 |
|
| 85 |
|
|
Current portion of Trust Preferred Securities |
| — |
|
| 670 |
|
|
|
|
|
|
|
|
|
|
Long-term debt and capital lease obligations, less current portion |
| 4,183 |
|
| 4,004 |
|
|
Trust Preferred Securities, less current portion |
| 696 |
|
| 664 |
|
|
Total debt |
| 5,945 |
|
| 5,642 |
|
|
|
|
Fresenius Medical Care AG & Co. KGaA, July 30, 2008 | 12 of 17 |
|
|
|
|
|
|
|
|
Fresenius Medical Care |
|
|
|
|
| ||
Six Months Ended June 30, |
| 2008 |
| 2007 |
| ||
|
|
|
|
|
|
|
|
Operating activities |
|
|
|
|
|
|
|
Net income |
| 397 |
|
| 339 |
|
|
Depreciation / amortization |
| 199 |
|
| 170 |
|
|
Change in working capital and other non cash items |
| (195 | ) |
| (1 | ) |
|
Cash Flow from operating activities |
| 401 |
|
| 508 |
|
|
|
|
|
|
|
|
|
|
Investing activities |
|
|
|
|
|
|
|
Purchases of property, plant and equipment |
| (343 | ) |
| (249 | ) |
|
Proceeds from sale of property, plant and equipment |
| 11 |
|
| 12 |
|
|
Capital expenditures, net |
| (332 | ) |
| (237 | ) |
|
Free Cash Flow |
| 69 |
|
| 271 |
|
|
|
|
|
|
|
|
|
|
Acquisitions and investments, net of cash acquired and net purchases of intangible assets |
| (133 | ) |
| (117 | ) |
|
Proceeds from divestitures |
| 41 |
|
| 27 |
|
|
Acquisitions, net of divestitures |
| (92 | ) |
| (90 | ) |
|
Free Cash Flow after investing activities |
| (23 | ) |
| 181 |
|
|
|
|
|
|
|
|
|
|
Financing activities |
|
|
|
|
|
|
|
Change in accounts receivable securitization program |
| 514 |
|
| 140 |
|
|
Change in intercompany debt |
| 173 |
|
| 24 |
|
|
Change in other debt |
| 212 |
|
| (112 | ) |
|
Redemption of Trust Preferred Securities |
| (678 | ) |
| 0 |
|
|
Proceeds from exercise of stock options |
| 10 |
|
| 8 |
|
|
Change in minority interest |
| (16 | ) |
| (11 | ) |
|
Dividends paid |
| (252 | ) |
| (188 | ) |
|
Cash Flow from financing activities |
| (37 | ) |
| (139 | ) |
|
|
|
|
|
|
|
|
|
Effects of exchange rates on cash |
| 5 |
|
| 6 |
|
|
Net (decrease) increase in cash |
| (55 | ) |
| 48 |
|
|
|
|
|
|
|
|
|
|
Cash at beginning of period |
| 245 |
|
| 159 |
|
|
Cash at end of period |
| 190 |
|
| 207 |
|
|
|
|
Fresenius Medical Care AG & Co. KGaA, July 30, 2008 | 13 of 17 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fresenius Medical Care |
|
|
|
|
|
|
|
|
| ||||
Three months ended June 30, |
| 2008 |
| cc |
| 2007 |
| cc |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
North America |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net revenue |
|
| 1,714,570 |
|
|
|
|
| 1,660,445 |
|
|
|
|
Growth year-over-year |
|
| 3.3 | % |
|
|
|
| 6.4 | % |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dialysis Care |
|
| 1,532,752 |
|
|
|
|
| 1,499,407 |
|
|
|
|
Growth year-over-year |
|
| 2.2 | % |
|
|
|
| 5.0 | % |
|
|
|
U.S. per treatment |
|
| 327 |
|
|
|
|
| 327 |
|
|
|
|
Per treatment |
|
| 323 |
|
|
|
|
| 323 |
|
|
|
|
Sequential growth |
|
| 0.4 | % |
|
|
|
| -0.4 | % |
|
|
|
Growth year-over-year |
|
| -0.1 | % |
|
|
|
| 3.0 | % |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dialysis Products |
|
|
|
|
|
|
|
|
|
|
|
|
|
incl. internal sales |
|
| 314,501 |
|
|
|
|
| 291,363 |
|
|
|
|
Growth year-over-year |
|
| 7.9 | % |
|
|
|
| 17.7 | % |
|
|
|
External sales |
|
| 181,818 |
|
|
|
|
| 161,038 |
|
|
|
|
Growth year-over-year |
|
| 12.9 | % |
|
|
|
| 21.3 | % |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
International |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net revenue |
|
| 950,566 |
|
|
|
|
| 743,767 |
|
|
|
|
Growth year-over-year |
|
| 27.8 | % |
| 14.2 | % |
| 23.0 | % |
| 15.3 | % |
| |||||||||||||
Dialysis Care |
|
| 391,507 |
|
|
|
|
| 296,137 |
|
|
|
|
Growth year-over-year |
|
| 32.2 | % |
| 18.6 | % |
| 32.3 | % |
| 24.0 | % |
Per treatment |
|
| 183 |
|
| 164 |
|
| 149 |
|
| 139 |
|
Sequential growth |
|
| 8.7 | % |
|
|
|
| 3.5 | % |
|
|
|
Growth year-over-year |
|
| 22.9 | % |
| 10.3 | % |
| 12.8 | % |
| 5.7 | % |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dialysis Products |
|
|
|
|
|
|
|
|
|
|
|
|
|
incl. internal sales |
|
| 638,222 |
|
|
|
|
| 507,737 |
|
|
|
|
Growth year-over-year |
|
| 25.7 | % |
| 11.8 | % |
| 17.6 | % |
| 10.1 | % |
External sales |
|
| 559,059 |
|
|
|
|
| 447,629 |
|
|
|
|
Growth year-over-year |
|
| 24.9 | % |
| 11.3 | % |
| 17.5 | % |
| 10.3 | % |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
cc = at constant exchange rates |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fresenius Medical Care AG & Co. KGaA, July 30, 2008 | 14 of 17 |
|
|
|
|
|
|
|
|
Fresenius Medical Care |
|
|
|
|
| ||
Quarterly Performance Scorecard - Dialysis Care Volume |
|
|
|
|
| ||
|
|
|
|
| |||
Three months ended June 30, |
| 2008 |
|
| 2007 |
|
|
|
|
|
|
|
| ||
North America |
|
|
|
|
|
|
|
Number of treatments |
| 4,744,174 |
|
| 4,596,264 |
|
|
Treatments per day |
| 60,823 |
|
| 58,921 |
|
|
Per day sequential growth |
| 0.8 | % |
| 1.3 | % |
|
Per day year-over-year growth |
| 3.2 | % |
| 3.0 | % |
|
Same market growth year-over-year |
| 2.8 | % |
| 2.8 | % |
|
|
|
|
|
|
|
|
|
International |
|
|
|
|
|
|
|
Number of treatments |
| 2,141,538 |
|
| 1,991,421 |
|
|
Same market growth year-over-year |
| 7.9 | % |
| 7.3 | % |
|
|
|
|
|
|
|
|
|
Fresenius Medical Care |
|
|
|
|
| ||
Quarterly Performance Scorecard - Expenses |
|
|
|
|
| ||
|
|
|
|
| |||
Three months ended June 30, |
| 2008 |
|
| 2007 |
|
|
|
|
|
|
|
|
|
|
North America |
|
|
|
|
|
|
|
Costs of revenue and operating expenses |
|
|
|
|
|
|
|
Percent of revenue |
| 83.1 | % |
| 82.8 | % |
|
Selling, general and administrative |
|
|
|
|
|
|
|
Percent of revenue |
| 16.1 | % |
| 16.0 | % |
|
Bad debt expenses |
|
|
|
|
|
|
|
Percent of revenue |
| 3.0 | % |
| 3.0 | % |
|
Dialysis Care operating expenses/Treatment (in US-$) |
| 269 |
|
| 267 |
|
|
Sequential growth |
| -0.6 | % |
| -1.6 | % |
|
Growth year-over-year |
| 0.7 | % |
| 1.5 | % |
|
|
|
|
|
|
|
|
|
Total Group |
|
|
|
|
|
|
|
Costs of revenue and operating expenses |
|
|
|
|
|
|
|
Percent of revenue |
| 83.9 | % |
| 83.7 | % |
|
Selling, general and administrative |
|
|
|
|
|
|
|
Percent of revenue |
| 17.8 | % |
| 18.0 | % |
|
Effective tax rate |
| 37.2 | % |
| 38.0 | % |
|
|
|
Fresenius Medical Care AG & Co. KGaA, July 30, 2008 | 15 of 17 |
|
|
|
|
|
|
|
|
Fresenius Medical Care |
|
|
|
|
| ||
Quarterly Performance Scorecard - Cash Flow/Investing Activities |
|
|
|
|
| ||
|
|
|
|
| |||
Three months ended June 30, |
| 2008 |
|
| 2007 |
|
|
in US-$ thousands, except number of de novos |
|
|
|
|
| ||
|
|
|
|
|
|
|
|
Total Group |
|
|
|
|
|
|
|
Operating Cash Flow |
| 209,383 |
|
| 224,977 |
|
|
Percent of revenue |
| 7.9 | % |
| 9.4 | % |
|
|
|
|
|
|
|
|
|
Free Cash Flow before acquisitions |
| 29,927 |
|
| 95,363 |
|
|
Percent of revenue |
| 1.1 | % |
| 4.0 | % |
|
|
|
|
|
|
|
|
|
Acquisitions, net of divestitures |
| 58,335 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital expenditures, net |
| 179,456 |
|
| 129,614 |
|
|
Percent of revenue |
| 6.7 | % |
| 5.4 | % |
|
|
|
|
|
|
|
|
|
Maintenance |
| 85,799 |
|
| 61,636 |
|
|
Percent of revenue |
| 3.2 | % |
| 2.6 | % |
|
|
|
|
|
|
|
|
|
Growth |
| 93,657 |
|
| 67,978 |
|
|
Percent of revenue |
| 3.5 | % |
| 2.8 | % |
|
|
|
|
|
|
|
|
|
Number of de novos |
| 26 |
|
| 16 |
|
|
North America |
| 12 |
|
| 11 |
|
|
International |
| 14 |
|
| 5 |
|
|
|
|
|
|
|
|
|
|
Fresenius Medical Care |
|
|
|
|
| ||
Quarterly Performance Scorecard - Balance Sheet |
|
|
|
|
| ||
|
|
|
|
| |||
Three months ended June 30, |
| 2008 |
|
| 2007 |
|
|
|
|
|
|
|
|
|
|
Total Group |
|
|
|
|
|
|
|
Debt (in US-$ million) |
| 5,945 |
|
| 5,662 |
|
|
Debt/EBITDA |
| 2.9 |
|
| 3.0 |
|
|
|
|
|
|
|
|
|
|
North America |
|
|
|
|
|
|
|
Days sales outstanding |
| 61 |
|
| 59 |
|
|
|
|
|
|
|
|
|
|
International |
|
|
|
|
|
|
|
Days sales outstanding |
| 107 |
|
| 107 |
|
|
|
|
Fresenius Medical Care AG & Co. KGaA, July 30, 2008 | 16 of 17 |
|
|
|
|
|
|
|
|
Fresenius Medical Care |
|
|
|
|
| ||
Quarterly Performance Scorecard |
|
|
|
|
| ||
|
|
|
|
| |||
Three months ended June 30, |
| 2008 |
|
| 2007 |
|
|
|
|
|
|
|
|
|
|
Clinical Performance |
|
|
|
|
|
|
|
North America (U.S.) |
|
|
|
|
|
|
|
Single Pool Kt/v > 1.2 |
| 95 | % |
| 94 | % |
|
Hemoglobin >= 11g/dl |
| 73 | % |
| 81 | % |
|
Albumin >= 3.5 g/dl1) |
| 80 | % |
| 79 | % |
|
Phosphate 3.5-5.5mg/dl |
| 55 | % |
| 52 | % |
|
Hospitalization Days per patient2) (12 months ending June 30) |
| 10.5 |
|
| 11.2 |
|
|
|
|
|
|
|
|
|
|
Demographics |
|
|
|
|
|
|
|
North America (U.S.) |
|
|
|
|
|
|
|
Average age (yr) |
| 62 |
|
| 62 |
|
|
Average time on dialysis (yr) |
| 3.5 |
|
| 3.4 |
|
|
Average body weight (kg) |
| 79 |
|
| 79 |
|
|
Prevalence of diabetes |
| 53 | % |
| 52 | % |
|
|
|
1) | International standard BCR CRM470 |
| |
2) | Hospitalization data without former RCG facilities |
|
|
Fresenius Medical Care AG & Co. KGaA, July 30, 2008 | 17 of 17 |