FMS - Earnings call transcript Q2 2021 | Fresenius Medical Care AG & Co. KGaA

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Operator

Ladies and gentlemen, thank you for standing by. I am Emma, your Chorus Call operator. Welcome and thank you for joining the Fresenius Medical Care Earnings Call Report on the Second Quarter 2021. Throughout today’s recorded presentation, all participants will be in a listen-only mode. The presentation will be followed by question-and-answer session. now of turn Investor would to conference I Head Dominik, Relations. Instructions] like the to over [Operator Please, go ahead, sir.

Dominik Heger

Thank you, Emma.

As for XXXX. would our today mentioned like to quarterly the welcome we by results. you to discuss earnings the appreciate We call quarter second you joining Emma, to

materials the as in is Now safe in my out harbor always, we in our and mentioning that statement, to as is by earlier the cautionary well our distributed our all presentation it start as today. pleasure, call have language that

For to further as SEC please details concerning risks and to these uncertainties, refer filings. well documents as our

for are away is from We to most you Therefore, weekend. to time we try keep short it Q&A. that your presentation keep likely aware the us leave and

the give outlook. will The an Board. over floor Chief color development. business Financial the Giza, would could also number to the again. some who we this always, Chairman ask of give Rice. the of is of limit you we I course, Officer, will to the will in Management now around And, with on With our two, today the Powell, It more of chance like update if make and us again questions. great everyone course, CEO to give to Rice order is, financials our to Rice work and us Helen you hand be questions is would As yours.

Rice Powell

four. there. Welcome, for we almost a us it's Dominik. Thank you, happy Friday, I on did in on I'll time begin joining weekend, Thank and call last you hang slide today. a Friday. earnings remember don't everyone, an the but

impacts. they're they or do clinics, not related expected certain pharmacy. the for And clinics our of despite assets, renal the This don't if of the access as need in or in vascular not additionally, patients business and organic the We the services, then treatments drugs such to they products. be downstream continue continuing adverse as deliver dialysis growth missing our affected dialysis need in in are to and compounds number dialysis our quarter, our COVID

see anticipated. mortality but levels quarter, the reduced had as We further accumulate excess we at continue to in significantly

revenue from were during second quarter impacted quarter by of by was that start driven of by exchange Act Earnings the The and as year you This expenses funding the in COVID-related earnings know, adversely the effects. we both and rate to prior was year, affected the phasing cover quarter a CARES pandemic. strong the development received base. negatively last second the

to strategic quarter. We progress good our continue make on priorities the in

First, end-stage patients in have patients our in approximately value-based with approximately value-based CKD kidney U.S. disease for accounted total XX,XXX patients of XX% arrangements. and we arrangements

the a our in Secondly, XX.X% home second momentum United quarter, with home in dialysis of the States treatments performed setting. in continued experienced

FME XX reduce to and parallel Thirdly, to And our in econsense, base to transformation there at our support the model the until heart sustainability program our of activities, united sustainability in goal the management, joined suitable companies be order of all further recently a sustainably above-mentioned network continues of society. the a shaping is to strategy. of transform cost and we the XXXX. In operating global to economy our

fall. this on with the are work. in to XX We on track plan announce details FME We

open. the are variant and confirming Delta year are draft with was we rate in in that to form. of report inflationary XXXX. X.X% While increasing in development first half still cautious the expectations for is second our we and of increase continue is in mind prospective XXXX, I'd overall this our Medicare proposed guidance. roughly proposed Thinking therefore like quarter is period keep impacts our expectations. the the ESRD mention with and in macroeconomic system ahead line the line and to Please watch The The the comment payment

point of at see to rate the in expect month final November. the We some

Turning X. to Slide

XXXXXX For sustaining the coming our growth number we ago the pandemic from first over life and lives. Pacific, both with on in the are a a X% quarter. of strongest patients' number our as clinic impacts reflects growth half where of patients of X% treatments the of development year in X% the patients, over the our down had The XX network we in growth international to of the a Asia delivered rate treatments year result clinics from million

Turning to Slide X.

demonstrating light as of care control that We well bone the our and see receiving continue mineral as consistent are pandemic. stable patients metabolism high-quality, dialysis to anemia in even

would you worldwide The the patients. to compares we the Medical seen COVID development comparison slide the Care Slide population. infections to in incidents of If our of turn vaccination patient number Fresenius X. efficacy have our This among highlights

thereafter. cases partially approximately, Today the spiked at cases are our are worldwide our April same of As vaccinated. vaccinated. well the as the in over In FMC least, of worldwide XX% US number XX% patients of for partially patients and approximately, patients period declined

know longer between we are of XX%, we When you that numbers XX% somewhere but we control. outside that XX% us are the But X% are our X% in at that quote We FMC look be those crunched those will. we to vaccination. to get control. happens to somewhere believe takes a do for because vaccinated of exactly know that we to things -- if also being We in there that verify little that our patients

higher vaccine hesitancy will. While for vaccines. well our of vaccination normal annual about this times, regular we ahead with influenza we flu reflect that a current XX% the of rate the just see overall typically figure In you for It see Americans. of is hesitancy adult a simply if vaccination does degree

to to among So our it obviously, COVID. vaccine to we relates are hesitancy population working hard lower patient try as this

Slide X. Turning to

skewed rate. mortality of start in X,XXX XXX XXX the Thank As June. lower in were but in we in basis significantly excess to XXX April, excess quarter The deaths accumulate the a goodness. a period. on May, and anticipated COVID-related deaths deaths second to global occurred continued quarter the in the at

international and into third will this excess continue and are June saw will XX, a North think expect into accounted It be of over little second to are mortality global have in And a the everything These get numbers mortality the that come for you size fact will the meaning we America, scope trend experience. a and by that the are the of about quarter stop We of will when in of range of significant think I perfect XX% we we is that's pattern that July step the excess optimistic North but not what the is the this than we we perfect. XX% calendar as take see in it that, and under It course the half America to that a of quarter. quarter, normalized and second year. we'll the across time, anticipated. and encouraged little less the

While accumulated to the looking has the performance. continue start Globally, slowed, accumulation experienced pandemic, of of accumulated rate we've to basis And the at last deaths XX,XXX. will have we to further on it then XX-month excess approximately mortality from XX,XXX. excess incremental a approximately the weigh on

achieved of second quarter, Moving billion, the growth we constant currency. X% reflecting X. €X.X in In on revenue to slide

XX% Our a constant items currency basis. on by net income, excluding special declined

by and And the line in will impacted XX a face experienced quarter, €X had XX level. to negative costs the top we from to the Please As in and foreign headwinds be last we during FME I special related costs was had recall prior negatively as our treated high XXXX announced, year second quarter base. a bottom related the translation. in we of that, at first second FME Earnings mentioned negatively of already the benefited growth previously consulting that, from effects year. currency pre-tax the quarter item. million of pandemic COVID-related that continue impacted recovery quarter

slide America. experienced second America, XX. our regions. exchange growth the driven negative slightly we rate delivered growth We effects Organic of Despite to North EMEA, down organic contributed related all the during organic our markets Asia quarter, in positive in challenges Latin Pacific international and all was pandemic, with to the by growth. Moving

reimbursement we placed the through to that, Helen, a on in as our also who face over Helen, Here, it COVID, more will give calcimimetics, development turn only the from lower with I'll not please. of being negative them but And color bundle. consequence impacts quarter. for you

Helen Giza

Rice. you, Thank

As hi, we moved, everybody, hope and staying you're well. I

XXX to X% at the approximately COVID slide in was on from XX, markets. organic more in Healthcare delivered calcimimetics, the overall. pandemic growth to due pick basis move Organic The currency quarter. exchange than we points negative international despite effects. development. the growth constant As and from the growth second of organic adverse amounted This Services services increased on Healthcare the for the offset quarter, In to impact by growth negative I'll Services up the

US, see will the first to slide fundamentals did move that the sequential from in market in intact. the decline year-over-year a we the XX. down improvement from growth. now of This improved shows underlying [Indiscernible] on decline treatment this products It quarter of a quarter. X% are While I same business to slide

basis, positive This the both effects. was in machines for lower was second and X% EMEA a had mainly was in sales chronic acute rate development organic each On by by achieved growth exchange Asia with particular a organic by Our and regional strong in-center in higher of solid a to base. growth. quarter, pharmaceuticals. driven organic offset, the products X% in treatments products renal for EMEA quarter. Overall, The second and care Asia for compared decline quarter year prior products' business driven negative growth delivering of disposables Pacific North America Pacific, treatment sales

to XX. Turning slide

is illustrates the amounted region, regional group quarter, currency. the as XX% well contribution The to the corresponding million, margins. of the For which operating as chart decline on second left, total €XXX constant at from income a each

have an adverse impact first the are COVID comparing indicated base. base year a of the did that against from impact As recover year, the the of last we tough consequently prior we year, quarter we margins QX inflated In we second as last we and compare negative to COVID, with. experienced from quarter an discussed, faced in

particularly had effects, a and reverse strong our increased experienced but in largest costs the North the of second labor of also to Exchange both year effects SG&A headwind knew were inflationary that would affecting in favorability region quarter in regions, materials. we due the we all America. And in our raw phasing in we this Additionally, macroeconomic expenses rate a quarter. first

saw the the of Medicare last business. continued like growth the years, quarter second we Advantage at to side, remains improved in usual and the positive due Medicare the payer in book Advantage On fastest-growing intra-year pace and its mix an our growth in

just not within Advantage to mix Medicare our in Medicare represents US percentage eligible population now patients. Our the relative a XXs high entire and very patient the

quarter second now to XX% items, which slide excluding by Our I XX. on a net a net constant impact of on basis, €XX COVID-XX currency includes declined will income, special negative million. move

and the the big overall. helpful was at swing we of to might QX Although QX thought the between expected, first the year be half margin developments for look it

half a It to second to the margin of the we year, on mortality our excess the beginning are will assumed. of large accumulation pandemic there development, and margins think biggest margins on one the The mortality the mortality is core impact. on first that excess year, year. a the half relates six surprisingly. no this important are if dialysis the is effect The of pandemic impact of businesses in months both even since remember gives downstream continue for I our view COVID, in not further impact effects clearer to the where COVID-XX of of excess accumulated component the of

impact labor of In to margins the year. first ease of higher made but effect this raw comparison to a both gains second We XXXX, costs not half from of negative the from of this the clinics. we we vascular development the the and would monitor benefited materials macroeconomic and year-over-year, impact sale the had assume cardiovascular HX. effects something Consequently, in will also faced the and continue inflationary we half for for and due is not the

positive half As the first side mix the Medicare Advantage contributed from for in XXXX, the development. the improved payer previously mentioned margin US to of the

XXXX guidance of the of is months six in much first our in with the at our HX and development very line our range. middle expectations collectively, Looking

reason With to we XX. comfortable year. slide the for confirming outlook that our For that turning are

the a in year. and the XX.X%. advanced flows quarter, cash €XXX During last of generated to also due resulting the million we labor cash quarter expenses second these of the of quarter level €XXX quarter. recruitment of operating year The recouped to and were the was flow. this mainly payments timing the million of contributed payments the federal The the second Act of second start the lower margin of under government US in the CARES of decline payments during

of development that and links of Our of The the we'll to support With sustainability-linked net range COVID, months presented a will our financing year times. within the leverage X.X effects position. the that €X expectations. developed reconfirmed early line in its our In first commitments financial turn includes margin performance. with this ratio Earlier of for of XX. the three slide in bottom target create ratings to sustainability the The and our light to right our is our billion six XXXX instruments ecological, at solid credit to first signed second be facility terms. year value underlining in component revolving further economic times X.X syndicated quarter social, we

to confirming as our in year defined we targets and XXXX full February. Our are assumptions continue hold

For mid-single-digit deliver XXXX, net of teens low growth and decline expect revenue to we to to in income high a mid-XXs.

the to assumes X, second the exactly may guidance zero the half are develops progress or And the right be It by where we July certainly are mortality are but Delta closely further not is particularly are in of plan whether this we our are normalization encouraged of to mortality direction. to of but in watching noted, quarter, our while patterns the we guidance. relative At of to in see excess And Rice heading cautiously vaccination too say be of several rates we year. base, as lower. second it early we how Our patient where the beginning a are the lead we will as accumulation markets, excess very variant to vaccination among optimistic. end not,

distribution macroeconomic increasing labor the impacts monitoring costs. also affect are and which costs, both We inflationary manufacturing,

and now, from it concludes my Dominik turn that to know summary, over Q&A. to we prepared on I with track what in So, are remarks right And guidance. we our the begin will

Dominik Heger

hand Emma. Thank Thank you, I'll presentation. Please it you, Rice. over your Q&A. Helen for open the to

Operator

Ladies the of this the comes The question ahead. with you. time, at question-and-answer Please [Operator Jones gentlemen, begin Thank from Instructions] Tom first we'll line session. Berenberg. and go

Tom Jones

or afternoon for morning. taking questions. two. Good Hi. have Thanks my I good

first sorry from points The margins afternoon higher basis labor was -- points for or saw The on XX, XXX or basis just one you percentage point slide -- costs Friday to probably that Helen some HX and for XXX clarification. it's in hit supplies.

of addressed of about key that some the program. should is any be to the you changes but don't was point the so question Just mean, included buried all other ES What item or changes all the proposal, in of COVID-related to on a the PPS in secondly to models? some some not XXX appear clear basis stuff that Rice I the there. was of. rates, of have then they that COVID of the proposed make headwind in or for of helpful, about we And them but it, related, that the cost much look the ETC talked floors

and else get think So just thought wondering, you of what I'm between about proposals kind be the done proposed and you to what rule able you the might rule. final the

Rice Powell

it's slide guidance you Rice. Tom, go Tom some was on your ahead? I give XX. why you for Hey to don't looking think Helen,

Helen Giza

well. you're hope Tom, hi to, happy Yeah Yeah.

the the in that seeing confusion, you avoid that XXX limited other That of is see COVID-related and to estimate kind the to is So truly inflation, separate guidance. basis that to that around increase. is we business. contemplated is that for wage any across are X% That completely increases we truly points

separate we're rates But things these kind petrochemical and here, increases our manufacturing the our to that more us think watch distribution. normal inflation for of that calling COVID. XXX have and on I guidance and impact basis that freight costs we're you and see macroeconomic lumber inflation like is out seeing is truly that points the an the on and in

Tom Jones

very Okay. and clear, the on Perfect. EPS? That's then,

Rice Powell

would got Tom, we've I work do. Hey say, to Yeah.

We I'm commentary. long-time. guessing, each we've are known a working our because, on other

what looking little home that's that when looking EPC group actually prospective think people two of a they versus And the sort the payment I preferred do We are groups. to they say bit think they And you've the got and dual at eligible within poking arbitrary. transplant. at folks, CMMI models. are that be at of the You're work separate

of their the them home dual some best it's et place to good therapy, in I that you are and give really And outcomes. cetera not if the do mean, going logical. best they really life given about station in chance think to for is eligible,

we reads questions make that So sense. I doesn't it there's just, socioeconomic really about way have think the and

still proposing been CMMI of a at working how on we're they're that do with lot the coordination the -- it. get system these sense what prospective and branch So where We versus payment look there and things. this between hasn't is they

So in get we're connect to read our dots a this. hoping on better commentary those and

Tom Jones

helpful. That's Okay. very

of share results? anything On on can with QX the models you the since model, us CKCC the additional subject that,

Rice Powell

Yeah. The seeing of goes. will that committed with where share bullish in and January to the only I'm started They thing on getting X. that it couple happy we've that that start had And -- absolutely in they're conversations Liz we the and are spring. Filer,

face be are and taking prepared and to value we it at go. So we'll ready

infrastructure have we and we know you As everything need.

in we're forward looking to started Year. the So New getting to that

Tom Jones

back That’s Okay. in the I’ll get queue. great.

Rice Powell

Tom. Thanks

Operator

comes Sachs. Please next of ahead. the Veronika from Goldman The with line go question Dubajova

Veronika Dubajova

I guess to taking quarter Good expected a commentary to just on that a morning would One, my the to question I you're please. cost bit raw if maybe basis want the business. is the in two Thanks willing not question. is And Tom's saw on half is usual I second that that I experience parent bit just you the that from it outside XXXX. a think commentary the savings Fresenius Helen little you what little or material clarify more for within out Helen. my trying FMC follow keep does I'll backing the comment which just run Rice. well had have and the expected your a that assumed And on from points from low from Stefan And rate second on is to suggest inflation made in cost follow-on FMC of the second would actually some conference XXX plan, to call, the confirm cost company guess bound as made of in question on just to helpful and just you for comments guide savings was set on contribution fairly something push be the it that? to he comments

I get think math -- targeting. on that I million the $XXX of my $X.X about you're to out billion to up

Just program be reading whether on should that as have XXXX, into towards to guys this done really XX. or we and are heavily work understand trying something oranges SME guys. we that Thanks Is comparing here? not and XXXX weighted more you apples

Rice Powell

ahead Helen. Thanks Veronika. Go

got two. take think I'll you've one and I

Helen Giza

Yeah. in commentary. built that range. saw material Yeah, Hi, keep half the increases What our this with expectations we we kind maybe in had just raw into and of guidance to our the Veronika. inflationary so clarifying one line is

through half expect can two. to that You continue

as us significant point. there's I out over said think the is above for if we're anything at not that this coming that seeing and watch I

back up gone and have things Some down.

cautious, guidance that nothing would obviously and watching But higher, these but this but from year-over-year of by we demand. us I not out and We're is take our are and Veronika. driven are increases as labor would still broader increase. at point market call supply say it that being at the look just current also out an economic being inflationary running things the Some unusual

Veronika Dubajova

Thanks Helen.

Rice Powell

we I looking is not is our the cost And not and with the and I'm too business would we concrete not to read are with want into cutting. about this this they numbers done model do them where as to this not that. business. now. I two, FSC number It's And we've work. much Veronika, And talked go how are with and right be we them, mean like not by what would program just operational at we want certainly to forward giving more because

going just we I the understand cut. going I in So keep to would just you I where fall, not we say to play tell they a you would where out. cost but mind we're are, you'll is and how where in it's understand set come this when But are,

it the and so in try do to I figure is if is we we're And where run you numbers out it because to wouldn't catch going where tell drift. my fall when you this

Veronika Dubajova

good clear. of Understood. Thank the summer. you you and That’s have hope guys, rest a very

Rice Powell

Thanks Veronika.

Operator

line The the go next question from of Oliver Please comes with Metzger Commerzbank. ahead.

Oliver Metzger

questions. taking Thanks my Hi. for

reported vaccination first one of level is The XX%. your on

me look you that age high, some for but comments, for the if looks glance, made So, at it you record. first particularly not

a So perspective. level I a -- clearly there but think it's differences some are on from regional global and

you particular So, the in could first EMEA? an where in give the you And us question. idea are of and that's yes, in US

down, The the is also treatments home number on level. see dialysis I you the But still a is on some are of second some record slide down, X%. clinics one patients metrics, reported up year-on-year basically are by there are

color these very I metrics? much. from which miss is there between give relation So, Thank I us utilization more should just Can you the the clinic? read on stronger or anything you do

Rice Powell

I'll Oliver. take those. Sure,

So doing And they me in keep don't because somebody mind, a at a better -- XX% global global vaccination I think find that's rate rate. are. of

on incorporates places that like little Africa where South So Indonesia, there's or Vietnam. going very

we significant good in other And where well midst my about of as hesitancy people markets I in at very parts said are in vaccinated. are So, certain US feel of that not the as XX%. in a as the getting I commentary,

I think that see reduce. we'll

are these when better, FDA it vaccines think I approved. get will

some is I some what XX%, are suspect comfort do bit And of population and be to hesitancy little at this think them to get higher. won't that going matter we give going US they're no ahead will we the there a But go that I subset vaccinate. there.

so they're they're vaccination or And many just tells incorporating at which you where XX%. probably parts in we of even the are look the take are they then slow very Europe high in the think system seeing XXs our if a good you I XX% as those very are those markets If EMEA, in low emerging that vaccination rates you rates US. as in to many, not saw

think Don't I'd doing I actually me it Oliver, like well I as on but not and to. think working get pretty as we're we're So, well wrong be but doing could hard that. better we're

some clinics, number predominantly the that some well of board. know those on by over new region we've Asia have some Pacific. in and driven a these an X% every just getting been clinics are X% certified and was the and about as On In building of coming they're had their -- while and ago them up quarter, started clinics. they now We XX-month -- period up were validated of been you in number of

With in X% the really international markets. bulk saw of growth in Asia the Pacific that sits we that

Oliver Metzger

on follow-up one dialysis record ask quickly level. I May home Great. Okay.

HHD? comes share which part you So, part from could us with PD from comes which

Rice Powell

think the pretty we're we're our quarter-to-quarter. are slow with consistently it's Sure. again, quarter. the what fairly to we comfortable home seeing grown I numbers, But then faster. And you quarters single In hemo. home And treatments specific in is PD XX.X% growth still growing done the mid- seeing the case, some And are is don't has know I double-digit tell of numbers. on the at sometimes. had I will of seeing. high we PD in single-digit consistently then in but But HHD this what we

Oliver Metzger

very you much. Thank great. Okay,

Rice Powell

Thank you, Oliver.

Operator

ahead. question with of Jungling next the comes go from The Michael Please Morgan Stanley. line

Michael Jungling

you I and good on questions Thank two afternoon. have vaccinations.

this how of effective can your the you know end how on but is within the the of essence, topic, you end ESRD a been or the by morbid I patient -- a do have it's who patients you can will but number Firstly, what have COVID, population? survival sense think are where vaccinated? get in And rate you comment know secondly And vaccination year? effective then up of you comment whether vaccinations

Rice Powell

a Sure is vaccination questions. would regular a up? where at annual we equaling. influenza wow Michael. rate if on which XX% that hesitancy. to when as could would I me it were it call we Good great basically we hope do around for Well What vaccinations it XX% we I speculate that be the would runs outcome, mean usually normally see end

would get I So, out XX% this. another see us of love to

approved some make I think pickup, in FDA they difference as get will will when said the think I that get I that a we US.

think going we're get to that them the the of I continue of can't rates that improve world parts to short the world are the just we the see of emerging rest some of in vaccines.

effectiveness we getting that with of we challenged that And huge we've hope a do they better. within not I they're the to So patients, dialysis get our protection relative it's of then are health seeing vaccines. study. FMC we even -- done do the study effectiveness actually status But the that see getting are

we everything in more is viral think all it Xx vaccinated I office with variant not it and is, is, us we're Delta we what the medical about I which if we're my for that really you breakthrough vaccinated people of been symptom take the of Now nearly others talking the tells them. question and read have twice not than concerning. mind aware few the watching with they variant in they severity very and that have are that. that and issue Generally, the is patients But is for had which have cases an the the had dialysis a Delta

see anything to getting what magic point Delta the a we folks that in real it if we comes the So here variant the would got to we're so, vaccinated in way keep sample But but just going you is to tell small the size that's hope I Michael. withstand that's and at very time. this be able

Michael Jungling

can COVID? COVID-XX? patients other -- your on of you up I follow it can the have ask Maybe proportion way. had many maybe briefly vaccination. How I actually this what know do And

Rice Powell

don't probably easily a It's at I back get shoot that not know my fingertips don't I my medical office from to can call I that number. anybody text me to it I'll can I that wants the have Michael. come Yes and we data. you. now but get on just fingertips know the right if don't

Michael Jungling

Okay. you. Thank

Rice Powell

You bet. you. Thank

Operator

question comes James Jefferies. with We The Vane ahead. of line Please David go JPMorgan. the question next go Vane-Tempest is from your muted. of line Tempest, currently ahead. Mr. from the with line Adlington to Please on the next move

David Adlington

taking Two my questions. thanks Hi, please. for

do it of sort in first patient the your stronger side. vaccination So else it could evolution are what any And can terms and revisit pull? anything rate they on any And of of Is on on wondering, in remains the service mean so are the math uptake? cost XX% sort terms payers you unvaccinated side just just from of evolution. one, education try that if here? sympathetic of there just side? customers/payers mortality to to running the price product at just sympathetic or the from sorry might and how your is increases you your again Is on some to second levers wider customers the XX% accelerate side, I'm you about are then the the how to

Rice Powell

and David. Yes, would please. you I'll take Thanks, one you two. take let Helen, I'll three if

to done globally US have of vaccination have it's politicized people vaccinate importance a certainly other of the little vaccinated situation this and but in It's the to US. efforts talking to myself to number where bit the in things uptake overly been David things, in try we that videos, actually encourage relative well a about -- that. people educational of So have particularly we

talk let's to could a it XX%, I'm the to get to a work quite little have just feel lot we can more those consider. point to see then this which said particularly focused XX%, on how earlier. to honestly, hard model, and this on XX% can want do about haven't if run at see to had we are? mathematics you trying payers it's they to And because through. done Helen, continue that products number to just But point. will mortality not to going that about where we're go So continue we way try to At are and and our We mean at tried I more up. need time for that sort And something what we we're going

Helen Giza

sure. for Yes,

already David, COVID you is lot lot from falling of increases of on is There's a This our of a we burden us. not the opportunity kind obviously lot appreciate pass increased of the US and last the pricing obviously, were As bearing are get that contracted the Obviously, can year a increases. covered government. on to this year those of or cost. cost

to you into contracts any where that in we challenging But of of cost reports increases. would up say, pass our cost customers difficult on hope quite the and have Some been go and it's will increase. that with future future I show

David Adlington

Understood. Thanks, Rice.

Operator

Falko next question Friedrichs comes from the ahead. of The Deutsche with line go Bank. Please

Falko Friedrichs

you. good please. two Thank afternoon. questions And

update and how of on even it's The focused depending prepared care number working Any still some that savings few one, here are settings remarks. of the revenue actually mentioned numbers ballpark €XXX and million, Is Rice, what range is on And coming question still how provide way will helpful. patient through any Thanks is providing a care. time final very of you're you in it if will over you the months? would can the on then variation market everything, million results, be or that very for my really rough sort Capital on €XXX Markets line just figure? you on could time or we your going number. lines XX. value-based out first sign a should be get the Day also could do a sure value-based to this FME with much And details. income you the plan be QX Is there revenue it? sort us that be second net that you to around you there will when given do next back or of And a the

Rice Powell

you questions. thank take will one. Falko, for I number Hey, the

pick of the I up then and if would want great. to care value-based And an on think that's focus Helen A that the part B and be on the kind savings you timeline, numbers. the

I October, would And of sometime So October. think -- you on I we Markets think it do X. obviously call we Day, think earnings it a to we've I Capital in say, me is this try the can probably do got November. I then to fall would would middle way. about the did And if November

got our I fairly a where that. it's to and So that through just think how small window to frame. want sense most work way we've think time we do it And within we makes

pretty a it's So short window.

So as talked figure October wanting will. and those a that I of said for the the period at as to payback period the and out over are November and €XXX that We're -- going this looking possibilities you about on we've one-for-one I laid planning you. Look, if at focused on million. we

at million happy million it hope that looking not We're we a €XXX you that perspective. tell be -- would we're get didn't going we're €XXX disaster. to So from and be

the as way this. going we've we looking we And hard to Helen we're what can will, do on at approaching deliver So value-based care? can talked more this we the and about, that's if we're as but

Helen Giza

Yes. Happy Hi, to. Falko.

the dialysis I because the that think our is business. because coordination models know, more feel and revenue number have -- meaningful as the we models that have really It's not. of more we number into you keep some a BBC the reporting do towards of and the and key that obviously, pass-through reporting don’t savings we're is have of different make So doesn't don't services to all -- shared also a it changing of care some stopped contracts separately, much business that sense the very different capitated moving I kind separate. model the part models costs,

we're for us at means that what for are for forward. as what we -- BBC our think looking sense reporting at work operating hard will moving also make looking with KPIs outlined and I So we're FMEXX, the model

continues more that think come, part change I through business of our really big going to to this but recognizing this BBC we're as So grow.

So I our on think we'll move more as have we updates reporting.

Falko Friedrichs

Okay. you. Thank

Operator

comes the go of James line ahead. The with next Jefferies. Please from Vane-Tempest question

James Vane-Tempest

before. Taking had my technical Apologies I difficulties some question.

been apologies have answered. if So these

interesting the the was than from how mention more firstly was the impact I XX, continue how half. do in you to Advantage. going is inflection Just think And second inflation. it slide on on It's offsetting factors Medicare for

is I think the And said to offset the pressures? you on So my fair not Advantage year be then question able say machinations XX%. Medicare to will inflationary it for second that

vaccination wondering at population Just said And if then patient on national we But or where moment? think where areas Is have question, if a XXX-ish quick we're it interesting it I the lower I'm end I what of or rates July. in Thank comment so I so it was be you know wondering are the June. sort compared can final mortality, know, sub-XXX, your are summer. you – average? would just XXX to can in the coming which is you excess nearly we the at of to much. into

Rice Powell

our about the take back the life worries James. I'll days. No inflation the one come you vaccination. slide getting Thanks, Helen, let on difficulties these and not of in I'll around XX, way on number

Helen Giza

And tracking, a to. of happy James, XXXX were put a you. shouldn't offset of kind to that. pluses we XXXX when And without And I obviously what I it doubt you and driver inflationary recall Hi, that the obviously, hear minuses. it's showed from built a that the is The Yeah, guidance a think had Advantage important is the slide change an the February, of we in lot to good course, year-over-year kind to positive inflation Medicare of if out back there the we're forget. increases of in. that's

or untoward, we to signal in anything slide XX. anything want think concerning trying don't I truly So were

trying in In have we base – to as cautious, happy of Veronika of be But to comments earlier course, just half. And I probably already. in the my Advantage fact, Tom back we show to a understand those both the increases. you it – to more and obviously, are to watch be be an more to – have I as built prove helpful the missed offset But too. trying to kind may that want think increase that Medicare to and we increases with performance those Rice? inflationary was

Rice Powell

Thank Yes. you.

I what it seeing me that I me sure, asking run right. were get not you by to I'm the James, relative I parts just versus just other of So we're you sure, world. want understood, to make Can what again? vaccinations

James Vane-Tempest

Sure. Yeah.

look are the where you patients located when higher your of concentration lower at particularly levels versus I'm of So, lie you've seen the vaccination. just say, where wondering, patients in or where your US.

more which to in more national So areas would national example, be as can for have average, that to that level, there's in be than perhaps patients Thank – XX% basically and get the if – well. if of harder might take vaccinated less you. sort you you it

Rice Powell

Perfect. Thank That's you. helpful.

people. the Alabama, which is we deal US. gorilla, issue where southern seeing Missouri So the tell can if is Louisiana, hesitancy those most are finding that, you the Mississippi, that Arkansas, we the I with, we XXX-pound among in are that states the is

program, whatever want ignorance based if some into that have And west US that won't so appreciably are There off some close to get have you are political you going we're southeastern to see FDA of number out the be to to folks Wyoming, far when the but whatever. of get if Montana, approval Idaho, to we're to suspect, come to call just get we're will. folks these of going some that it some will those And XX% there I going in region.

like that, medium think there Vietnam, we get – about you world, what markets EMEA, rest I if think that don't Indonesia. to to the take emerging but better of some markets, places is or Africa, question are you continue I'd such got kind when that, appreciably it's to or we've there and say in know some more look but going you get of as India vaccination developed don't we if the no it, in South of

can are as to we ability. So the from as that those vaccinating we get much and have they places have

weeks on to when of an have then into hope three I a to the between somewhere we not tried the question but XXX get don't to June well south a probably have close and we heck will able we us of what some around it's if month you were would be in South We But to we're to other of easy two weeks Africa last part numbers view of read those it's working on to latter your and it, And vaccines I that August. do. be July. takes It we'll get these the at numbers. countries thing get those there. tell mid

to place right the just in not that just yet. do we're So

James Vane-Tempest

much. Okay. Thanks so

Rice Powell

You bet.

Operator

question next The Suisse. ahead. go Please line of comes Christoph with Credit from the Gretler

Christoph Gretler

Good Thank or afternoon morning. you, operator.

still room Is wage do you clinic rate which have to in kind maybe enough dialysis, US kind this the be discussion quite on would nice give a following, inflation are accommodate to your extra year It's kind labor kind When more to inflation? to US inflation how enough. you. hospitals kind some wage Maybe now D.C., much of how that enough. seems very wage any have the a high of inflation looks thoughts that out general on the just accelerating and PPS be for you in of inflation something one year I in going I year to they specifically? there listen And We on -- actually not about elaborate What's maybe the expect. specifically. market the in on they substantial not called looking question increase And of great. on if situation some Thank of still kind that? could respect speak. for personnel backward wage this bit

Rice Powell

Happy Sure. hear to to from Chris. Nice you.

say. things So would a I couple of

have planned year this X%. in around we and looking are wage at for We inflation

in of some we were had think covered. different to that through nurses, were have and experiencing a we what that have are to temporary I I planned we in or accordingly that may go had So seeing things you than we some this. health equivalent I to you're we will done utilized the ESRD they higher. population get little as perfect for systems What believe employees be if a as that actually in I'm pandemic, our clinic we little may Their us we But well. because are. sure out all think the hospital US. rates big we've spots think help staff the we is have a be they do the not

the a could PPS we've seen okay. thought would So was is have through have I range I higher. gotten be. it at that you yes loved say drafted What that X.X think would we it to to It I within number

D.C are help there's for in be question. the there that funds to €XX access. is pieces to the out available there. think degree answer PPE still are I And that that's in billion potentially would on One labor to sitting relief that those some relative your there to funds us two and provider

a I'm and We continue in a possibility as get more helpful think US, the nice Hopefully PPE any had pretty on we this record I be to continue to in been I've talk about as it there's to how discussed that. conversations we healthcare, particularly And that, at get detailed every But not and on active D.C. point, quarter. but certainly is that for where in certainly labor that now less we've year infrastructure plan half that. the help back for of we worried would about on broken that's But see some right the D.C. to are the I for on you. situation would we if focused in I well that. that. think overall weigh think going that's But

Christoph Gretler

good. you. great Very a have Yes. on. comment later the Thank and Appreciate weekend

Rice Powell

You as well.

Operator

There this at are no further time. questions

Dominik So, I hand back closing to for comments.

Dominik Heger

hope Take of speak all have care. And during have all as enough third to lively I Thank Emma. a to looking highly and to you appreciate. you discussion as to the you the you, to summer time it you speak for for moment. everyone limiting you forward and again. Thank questions, that's we two can to good quarter, hope at good the have

Rice Powell

Stay your Enjoy safe summer rest of weekend. and the care. your folks. Take

Helen Giza

Bye, everybody. you. Thank

Dominik Heger

Bye-bye.

Operator

gentlemen, now disconnect have concluded, Goodbye. and has telephone. and joining, for conference and you pleasant the you your may Thank day. a Ladies

Fresenius Medical Care AG & Co. KGaA (FMS) 30 Jul 212021 Q2 Earnings call transcript