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INVESTOR NEWS Third quarter 2016

Key Takeaway: Fresenius Medical Care AG & Co. KGaA COMPLETE OVERVIEW OF THE RESULTS FOR THE THIRD QUARTER AND NINE MONTHS 2016 phone: +49 6172 609 2525 fax: +49 6172 609 2301 email: ir@fmc-ag.com Content: Statement of earnings page 9 Segment information page 10 Balance sheet page 11 Cash

Full Press Release Details

Fresenius Medical Care AG & Co. KGaA
COMPLETE OVERVIEW OF THE RESULTS FOR THE THIRD QUARTER AND NINE MONTHS 2016
phone: +49 6172 609 2525
fax: +49 6172 609 2301
Content:
Statement of earnings page 9
Segment information page 10
Balance sheet page 11
Cash flow page 12
Revenue development page 13
Key metrics page 14
Quality data page 15
Reconciliation page 16
Copyright by Fresenius Medical Care AG & Co. KGaA
Fresenius Medical Care reports strong third quarter and confirms full year guidance
Group revenue +9% (+9% at constant currency), driven by a strong performance in Health Care services
EBIT growth in line with revenue growth, supported by very good development in Latin America and Asia-Pacific
Significant net income growth of 27% (+17% excluding special items1)
Care Coordination with positive growth momentum (revenue +29%) and improved sequential margin of 5% (+60 basis points) in line with expectations
Full year 2016 guidance confirmed
Key figures third quarter and first nine months 2016:
$ million Q3 2016 Q3 2015 Growth yoy 9m 2016 9m 2015 Growth yoy
Net revenue 4,598 4,231 +9 % 13,224 12,390 +7 %
Operating income (EBIT) 670 614 +9 % 1,851 1,665 +11 %
Net income 2 333 262 +27 % 855 713 +20 %
Net income (excl. special items) 1,2 333 284 +17 % 855 735 +16 %
Basic earnings per share (in $) 1.09 0.86 +26 % 2.80 2.34 +19 %
We are very pleased with our performance in the third quarter of 2016, which is the result of a strong execution in all regions, the success of our Global Efficiency Program as well as further expansion of our global footprint, said Rice Powell, Chief Executive Officer of Fresenius Medical Care. Care Coordination services maintain excellent growth momentum which will help us to extend our range of health care services even further. Based on our strong result for the third quarter, we hereby confirm our guidance for the full-year 2016.
Net revenue for the third quarter improved by 9% and reached $4,598 million (+9% at constant currency), mainly driven by a strong performance in Health Care services. Contributing revenues of $3,734 (+10%), Health Care services was largely supported by an improvement in US revenue per treatment (+$3) as well as a strong organic growth. Dialysis
1 2015 basis adjusted for special items (net income effect): divestiture of dialysis service business in Venezuela (-$27m), sale of European marketing rights for certain renal pharmaceuticals (+$5m)
2 Net income attributable to shareholders of Fresenius Medical Care AG & Co. KGaA
products revenue increased by 4% to $864 million in the third quarter, mainly driven by higher sales of machines, dialyzers and products for acute care.
Net revenue in the first nine months of 2016 increased by 7% (Health Care services revenue +8%/+9% at constant currency; dialysis products revenue +2%/+4% at constant currency).
In the third quarter, operating income (EBIT) increased by 9% to $670 million, in line with revenue growth. The operating income margin increased by 10 basis points to 14.6%, underlining a stable earnings quality. The increase in EBIT margin was mainly driven by the positive development in Latin America after the divestiture of our dialysis service business in Venezuela in the previous year s third quarter as well as a strong performance in Asia-Pacific. The EBIT margin in North America was impacted by higher personnel expenses for dialysis services, partially offset by lower costs for health care supplies and a higher volume with commercial payers.
For the first nine months of 2016, operating income (EBIT) increased by 11% to $1,851 million.
Net interest expense in the third quarter remained at the previous year s level ($100 million). For the first nine months of 2016, net interest expense increased by 1% to $308 million, mainly due to lower interest income as a result of the repayment of interest bearing notes receivables in the fourth quarter of 2015, partially offset by a lower debt level.
Income tax expense decreased by 2% to $164 million in the third quarter. This translates into an effective tax rate of 28.8%, a decrease of 400 basis points compared to the third quarter of 2015 (32.8%). This decrease was mainly driven by a lower tax expense as a result of released tax liabilities in the third quarter of 2016 due to tax audit settlements with tax authorities, as well as a favorable impact from the prior-year non-tax deductible loss from the divestiture of our dialysis service business in Venezuela.
For the first nine months of 2016, income tax expense increased to $471 million, translating into an effective tax rate of 30.5% (-190 basis points).
Net income attributable to shareholders of Fresenius Medical Care AG & Co. KGaA increased by 27% to $333 million in the third quarter. Excluding the 2015 impacts of (i) the after tax loss, $26.9 million, from the divestment of our dialysis service business in Venezuela and (ii) the realized portion of the after tax gain, $4.8 million, from the sale of our European marketing rights for certain renal pharmaceuticals to our joint venture, Vifor Fresenius Medical Care Renal
Pharma, net income increased from $284 million to $333 million (+17%) in the third quarter. Based on approximately 306.0 million shares (weighted average number of shares outstanding), basic earnings per share (EPS) increased from $0.86 to $1.09 (+26%); EPS excluding special items increased from $0.93 to $1.09 (+17%).
For the first nine months of 2016, net income attributable to shareholders of Fresenius Medical Care AG & Co. KGaA increased by 20% to $855 million.
In the third quarter, North America revenue increased by 10% to $3,300 million (72% of total revenue). Health Care services revenue grew by 10% to $3,068 million, of which Care Coordination contributed $618 million (+29%), supported by significant organic revenue growth of 24%. Dialysis care revenue contributed $2,450 million (+6%), driven by increased revenue per treatment and higher volumes of dialysis treatments with commercial payers. Dialysis products revenue grew by 7% to $232 million, due to increased product sales (especially machines and dialyzers). Operating income in North America came in at $536 million (+4%). The operating income margin of 16.2% was in line with the second quarter of 2016, but weaker than the previous year s third quarter (-90 basis points). This decline was mainly attributable to higher personnel expenses, a cost impact related to the vesting of long term incentive plan grants and growth in lower-margin Care Coordination, partially offset by lower cost for health care supplies. The operating income margin in Care Coordination came in at 5.0%, an increase of 60 basis points over the second quarter 2016, but below the previous year s third quarter margin of 6.8%.
For the first nine months of 2016, North America revenue increased by 9% to $9,512 million. Operating income increased by 16% to $1,486 million.
EMEA revenue increased by 2% to $675 million in the third quarter of 2016 (+4% at constant currency). Health Care services revenue for the EMEA segment increased by 8% (+10% at constant currency) to $335 million. This was mainly the result of contributions from acquisitions (8%), partially offset by the negative effect of exchange rate fluctuations (2%). Dialysis treatments increased by 9% in the third quarter. Dialysis products revenue decreased by 3% (-1% at constant currency) to $340 million. The decrease was driven by lower sales of renal drugs (whose marketing rights were sold in 2015) and dialyzers, partially offset by higher sales of machines and bloodlines. Operating income in the EMEA segment decreased by 4% to $125 million in the third quarter due to the prior-year impact from the gain resulting from the sale of European marketing rights for certain renal pharmaceuticals, an unfavorable impact from manufacturing costs as well as higher bad debt expense. This was partially offset by
favorable foreign exchange effects. The operating income margin decreased to 18.5% (-120 basis points).
For the first nine months of 2016, EMEA revenue increased by 1% to $1,982 million (+4% at constant currency) and operating income decreased by 3% to $395 million.
Asia-Pacific revenue grew by 13% (+8% at constant currency) to $427 million in the third quarter. The region recorded $192 million in Health Care services revenue, based on an increase of 5% in dialysis treatments. With an 11% growth in revenue to $235 million (+12% at constant currency), the product business showed an excellent sales performance across the entire dialysis products range. Operating income showed a significant increase (+25%) to $85 million. The operating income margin increased substantially to 19.8% (+190 basis points). This was primarily driven by the positive impact from overall business growth and favorable foreign exchange effects.
For the first nine months of 2016, Asia-Pacific revenue grew by 8% to $1,198 million (+8% at constant currency) and operating income increased by 3% to $225 million.
Latin America delivered revenue of $192 million, an increase of 9% and an impressive improvement of 27% at constant currency. Health Care services revenue increased by 6% to $139 million (+31% at constant currency) as a result of higher organic revenue per treatment primarily driven by a retrospective reimbursement rate increase, contributions from acquisitions and growth in same market treatments, partially offset by the effect of the divested dialysis care business in Venezuela. Dialysis treatments increased by 1% in the third quarter. Dialysis products revenue increased by 19% to $53 million (+18% at constant currency), as a result of higher sales of dialyzers, concentrates and bloodlines. Operating income came in at $20 million supported by the impact from higher revenue in the region, partially offset by unfavorable foreign currency effects and higher costs mainly related to inflation. The operating margin increased to 10.5%.
For the first nine months of 2016, Latin America revenue decreased by 10% to $520 million (+13% at constant currency) and operating income increased by 86% to $47 million.
In the third quarter of 2016, the company generated $439 million in net cash provided by operating activities, representing 9.5% of revenue ($579 million in the third quarter of 2015). The decrease was primarily attributable to a discretionary cash contribution of $100 million to Fresenius Medical Care s pension plan assets in the United States. The number
of DSO (days sales outstanding) came in at 72 days, an increase of 2 days compared to the second quarter of 2016.
In the first nine months of 2016, the company generated net cash provided by operating activities of $1,296 million, representing 9.8% of revenue.
As of September 30, 2016, Fresenius Medical Care had 108,851 employees (full-time equivalents) worldwide, compared to 102,591 employees at the end of September 2015. This increase of 6% was primarily attributable to our continued organic growth.
Recent events: Acquisition of Sandor Nephro Services in India
In September 2016, Fresenius Medical Care acquired 85% of equity interest in the Indian dialysis group Sandor Nephro Services from a group of investors. Established in 2011, Sandor Nephro Services is India s second largest dialysis care provider. Under the brand name Sparsh Nephrocare the company operates a network of more than 50 dialysis centers across the country. With the acquisition, Fresenius Medical Care has clearly strengthened its core business in one of the fastest growing economies of the world. Sandor Nephro Services is expected to generate revenue of around $3 million in full year 2016. Fresenius Medical Care expects the investment to be accretive in 2017 on earnings after tax.
Outlook 2016 confirmed
Based on the positive business development in the first nine months 2016, 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.
Fresenius Medical Care will hold a conference call to discuss the results of the third quarter & first nine months 2016 on Thursday, October 27, 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 third quarter/first nine months 2016.
Fresenius Medical Care is the world s largest provider of products and services for individuals with renal diseases, of which around 2.8 million patients worldwide regularly undergo dialysis treatment. Through its network of 3,579 dialysis clinics, Fresenius Medical Care provides dialysis treatments for 306,366 patients around the globe. Fresenius Medical Care is also the leading provider of dialysis products such as dialysis machines or dialyzers. Along with the core business, the company focuses on expanding the range of additional medical services in the field of care coordination.
For more information about Fresenius Medical Care, visit the Company s website at www.freseniusmedicalcare.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.
Statement of earnings
Three months ended September 30 Nine months ended September 30
in US$ million, except share data, unaudited 2016 2015 Change 2016 2015 Change
Health Care revenue 3,839 3,506 9.5 % 11,061 10,249 7.9 %
Less: patient service bad debt provision 105 104 0.8 % 341 320 6.7 %
Net Health Care revenue 3,734 3,402 9.8 % 10,720 9,929 8.0 %
Dialysis products revenue 864 829 4.2 % 2,504 2,461 1.8 %
Total net revenue 4,598 4,231 8.7 % 13,224 12,390 6.7 %
Costs of revenue 3,126 2,849 9.7 % 9,036 8,527 6.0 %
Gross profit 1,472 1,382 6.5 % 4,188 3,863 8.4 %
Selling, general and administrative 787 742 6.0 % 2,278 2,120 7.4 %
Research and development 44 35 25.6 % 120 100 19.7 %
Income from equity method investees (29 ) (9 ) 221.3 % (61 ) (22 ) 177.1 %
Operating income (EBIT) 670 614 9.2 % 1,851 1,665 11.2 %
Interest income (10 ) (6 ) 51.8 % (38 ) (80 ) -51.8 %
Interest expense 110 106 3.7 % 346 384 -9.6 %
Interest expense, net 100 100 0.6 % 308 304 1.4 %
Income before taxes 570 514 10.9 % 1,543 1,361 13.4 %
Income tax expense 164 168 -2.5 % 471 441 6.6 %
Net income 406 346 17.4 % 1,072 920 16.6 %
Less: Net income attributable to noncontrolling interests 73 84 -13.0 % 217 207 5.0 %
Net income attributable to shareholders of FMC AG & Co. KGaA 333 262 27.0 % 855 713 20.0 %
Operating income (EBIT) 670 614 9.2 % 1,851 1,665 11.2 %
Depreciation and amortization 197 179 9.3 % 573 537 6.7 %
EBITDA 867 793 9.2 % 2,424 2,202 10.1 %
EBITDA margin 18.8 % 18.7 % 18.3 % 17.8 %
Weighted average number of shares 305,972,432 304,738,291 305,602,983 304,201,787
Basic earnings per share $ 1.09 $ 0.86 26.5 % $ 2.80 $ 2.34 19.4 %
Basic earnings per ADS $ 0.54 $ 0.43 26.5 % $ 1.40 $ 1.17 19.4 %
In percent of revenue
Costs of revenue 68.0 % 67.3 % 68.3 % 68.8 %
Gross profit 32.0 % 32.7 % 31.7 % 31.2 %
Operating income (EBIT) 14.6 % 14.5 % 14.0 % 13.4 %
Net income attributable to shareholders of FMC AG & Co. KGaA 7.2 % 6.2 % 6.5 % 5.8 %
Three months ended September 30 Nine months ended September 30
unaudited 2016 2015 Change 2016 2015 Change
Total
Revenue in US$ million 4,598 4,231 8.7 % 13,224 12,390 6.7 %
Operating income (EBIT) in US$ million 670 614 9.2 % 1,851 1,665 11.2 %
Operating income margin in % 14.6 % 14.5 % 14.0 % 13.4 %
Delivered EBIT in US$ million 597 530 12.7 % 1,634 1,458 12.1 %
Days sales outstanding (DSO) 72 71
Employees (full-time equivalents) 108,851 102,591
North America
Revenue in US$ million 3,300 3,013 9.6 % 9,512 8,730 9.0 %
Operating income (EBIT) in US$ million 536 515 4.0 % 1,486 1,284 15.7 %
Operating income margin in % 16.2 % 17.1 % 15.6 % 14.7 %
Delivered EBIT in US$ million 466 435 7.2 % 1,276 1,085 17.6 %
Days sales outstanding (DSO) 55 52
U.S.
Revenue per dialysis treatment in US$ 350 347 1.0 % 350 345 1.4 %
Cost per dialysis treatment in US$ 278 273 1.9 % 281 282 -0.6 %
EMEA
Revenue in US$ million 675 659 2.5 % 1,982 1,956 1.4 %
Operating income (EBIT) in US$ million 125 130 -3.5 % 395 405 -2.6 %
Operating income margin in % 18.5 % 19.7 % 19.9 % 20.7 %
Delivered EBIT in US$ million 124 129 -3.6 % 393 403 -2.7 %
Days sales outstanding (DSO) 108 112
Asia-Pacific
Revenue in US$ million 427 378 13.0 % 1,198 1,107 8.2 %
Operating income (EBIT) in US$ million 85 68 25.4 % 225 219 2.5 %
Operating income margin in % 19.8 % 17.9 % 18.7 % 19.8 %
Delivered EBIT in US$ million 83 65 26.6 % 220 213 3.0 %
Days sales outstanding (DSO) 110 111
Latin America
Revenue in US$ million 192 176 9.2 % 520 576 -9.8 %
Operating income (EBIT) in US$ million 20 -8 n.a. 47 25 85.8 %
Operating income margin in % 10.5 % -4.7 % 9.1 % 4.4 %
Delivered EBIT in US$ million 20 -8 n.a. 47 25 87.5 %
Days sales outstanding (DSO) 144 132
Corporate
Revenue in US$ million 4 5 -43.0 % 12 21 -46.7 %
Operating income (EBIT) in US$ million (96 ) (91 ) 5.6 % (302 ) (268 ) 11.9 %
Delivered EBIT in US$ million (96 ) (91 ) 5.7 % (302 ) (268 ) 11.9 %
September 30 December 31
in US$ million, except debt/EBITDA ratio 2016 2015
(unaudited) (audited)
Assets
Current assets 7,218 6,768
Goodwill and Intangible assets 14,307 13,863
Other non-current assets 5,133 4,734
Total assets 26,658 25,365
Liabilities and equity
Current liabilities 5,254 4,149
Long-term liabilities 8,943 9,692
Noncontrolling interests subject to put provisions and other temporary equity 1,223 1,028
Total equity 11,238 10,496
Total liabilities and equity 26,658 25,365
Equity/assets ratio 42 % 41 %
Debt
Short-term debt 721 109
Short-term debt from related parties 99 19
Current portion of long-term debt and capital lease obligations 891 664
Long-term debt and capital lease obligations, less current portion 7,174 7,854
Total debt 8,885 8,646
Debt/EBITDA ratio 2.6 2.8
In accordance with ASU 2015-17 (Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes) as of December 31, 2015 deferred taxes previously recorded in current assets and liabilities have been reclassified to noncurrent assets and liabilities in the amount of US$216 million and US$36 million, respectively. As a result of deferred tax netting, noncurrent assets and liabilities were then adjusted in the amount of US$168 million.
Three months ended September 30 Nine months ended September 30
in US$ million, unaudited 2016 2015 2016 2015
Operating activities
Net income 406 346 1,072 920
Depreciation / amortization 197 179 573 537
Change in working capital and other non-cash items (164 ) 54 (349 ) (45 )
Net cash provided by operating activities 439 579 1,296 1,412
In percent of revenue 9.5 % 13.7 % 9.8 % 11.4 %
Investing activities
Purchases of property, plant and equipment (242 ) (230 ) (748 ) (647 )
Proceeds from sale of property, plant and equipment 6 6 14 11
Capital expenditures, net (236 ) (224 ) (734 ) (636 )
Free cash flow 203 355 562 776
In percent of revenue 4.4 % 8.4 % 4.3 % 6.3 %
Acquisitions and investments, net of cash acquired, and purchases of intangible assets (83 ) (65 ) (387 ) (166 )
Proceeds from divestitures 46 8 193 42
Acquisitions and investments, net of divestitures (37 ) (57 ) (194 ) (124 )
Free cash flow after investing activities 166 298 368 652
in US$ million, unaudited 2016 2015 Change Change at cc Organic growth Same market treatment growth 1
Three months ended September 30
Total revenue 4,598 4,231 8.7 % 9.2 % 7.4 %
Net Health Care 3,734 3,402 9.8 % 10.3 % 7.8 % 3.0 %
Dialysis products 864 829 4.2 % 4.8 % 5.7 %
North America 3,300 3,013 9.6 % 9.6 % 7.4 %
Net Health Care 3,068 2,794 9.8 % 9.8 % 7.4 % 3.3 % 2
Thereof Net Care Coordination revenue 618 480 29.0 % 29.0 % 24.0 %
Thereof Net Dialysis Care revenue 2,450 2,314 5.8 % 5.8 % 4.0 % 2.7 %
Dialysis products 232 219 6.5 % 6.5 % 6.6 %
EMEA 675 659 2.5 % 4.1 % 1.7 %
Net Health Care 335 309 8.3 % 10.3 % 3.2 % 3.8 %
Dialysis products 340 350 -2.6 % -1.4 % 0.5 %
Asia-Pacific 427 378 13.0 % 8.2 % 8.4 %
Net Health Care 192 168 15.0 % 3.2 % 3.8 % 4.3 %
Dialysis products 235 210 11.4 % 12.1 % 12.1 %
Latin America 192 176 9.2 % 27.5 % 28.2 %
Net Health Care 139 131 6.0 % 30.6 % 31.5 % 2.0 %
Dialysis products 53 45 18.6 % 18.2 % 18.5 %
Corporate 4 5 -43.0 % -43.3 %
Nine months ended September 30
Total revenue 13,224 12,390 6.7 % 8.2 % 6.9 %
Net Health Care 10,720 9,929 8.0 % 9.2 % 7.3 % 3.3 %
Dialysis products 2,504 2,461 1.8 % 4.3 % 5.3 %
North America 9,512 8,730 9.0 % 9.0 % 7.1 %
Net Health Care 8,838 8,087 9.3 % 9.3 % 7.3 % 3.7 % 3
Thereof Net Care Coordination revenue 1,704 1,382 23.4 % 23.4 % 19.2 %
Thereof Net Dialysis Care revenue 7,134 6,705 6.4 % 6.4 % 4.8 % 3.2 %
Dialysis products 674 643 4.9 % 4.9 % 5.0 %
EMEA 1,982 1,956 1.4 % 3.9 % 2.5 %
Net Health Care 967 919 5.1 % 8.5 % 3.3 % 3.7 %
Dialysis products 1,015 1,037 -2.0 % -0.1 % 1.7 %
Asia-Pacific 1,198 1,107 8.2 % 8.0 % 8.4 %
Net Health Care 538 496 8.5 % 2.8 % 3.7 % 4.9 %
Dialysis products 660 611 8.0 % 12.2 % 12.2 %
Latin America 520 576 -9.8 % 13.3 % 18.6 %
Net Health Care 377 427 -11.7 % 15.5 % 21.8 % 1.9 %
Dialysis products 143 149 -4.2 % 6.8 % 10.0 %
Corporate 12 21 -46.7 % -46.8 %
1 same market treatment growth = organic growth less price effects
U.S. (excl. Mexico), same market treatment growth North America: 2.7%
U.S. (excl. Mexico), same market treatment growth North America: 3.2%
cc = constant currency. Changes in revenue include the impact of changes in foreign currency exchange rates. We use the non-GAAP financial measure at Constant Exchange Rates or Constant Currency to show changes in our revenue without giving effect to period-to-period currency fluctuations. Under U.S. GAAP, revenues received in local (non-U.S. dollar) currency are translated into U.S. dollars at the average exchange rate for the period presented. Once we translate the local currency revenues for the Constant Currency, we then calculate the change, as a percentage, of the current period revenues using the prior period exchange rates versus the prior period revenues. This resulting percentage is a non-GAAP measure referring to a change as a percentage at Constant Currency.
We believe that revenue growth is a key indication of how a company is progressing from period to period and that the non-GAAP financial measure Constant Currency is useful to investors, lenders, and other creditors because such information enables them to gauge the impact of currency fluctuations on a company s revenue from period to period. However, we also believe that the usefulness of data on Constant Currency period-over-period changes is subject to limitations, particularly if the currency effects that are eliminated constitute a significant element of our revenue and significantly impact our performance. We therefore limit our use of Constant Currency period-over-period changes to a measure for the impact of currency fluctuations on the translation of local currency revenue into U.S. dollars. We do not evaluate our results and performance without considering both Constant Currency period-over-period changes in non-U.S. GAAP revenue on the one hand and changes in revenue prepared in accordance with U.S. GAAP on the other. We caution the readers of this report to follow a similar approach by considering data on Constant Currency period-over-period changes only in addition to, and not as a substitute for or superior to, changes in revenue prepared in accordance with U.S. GAAP. We present the fluctuation derived from U.S. GAAP revenue next to the fluctuation derived from non-GAAP revenue. Because the reconciliation is inherent in the disclosure, we believe that a separate reconciliation would not provide any additional benefit.
Key metrics North America segment
Three months ended September 30 Nine months ended September 30
unaudited 2016 2015 Change 2016 2015 Change
Care Coordination
Net revenue in US$ million 618 480 29.0 % 1,704 1,382 23.4 %
Operating income (EBIT) in US$ million 31 33 -5.2 % 66 85 -21.9 %
Operating income margin in % 5.0 % 6.8 % 3.9 % 6.1 %
Delivered EBIT in US$ million 26 22 15.6 % 44 52 -15.4 %
Dialysis
Net revenue in US$ million 2,682 2,533 5.9 % 7,808 7,348 6.3 %
Operating income (EBIT) in US$ million 505 482 4.6 % 1,420 1,199 18.4 %
Operating income margin in % 18.8 % 19.1 % 18.2 % 16.3 %
Delivered EBIT in US$ million 440 413 6.8 % 1,232 1,033 19.2 %
Key metrics Care Coordination
Nine months ended September 30
unaudited 2016 2015 Growth in %
North America
Member months under medical cost management 1) 281,964 111,867 152 %
Medical cost under management (in US$ million) 1) 2,036 965 111 %
Care Coordination patient encounters 4,057,022 3,774,936 7 %
1) The 2016 metrics may be understated due to a physician mapping issue related to the BPCI program within a CMS system which has not yet been resolved. Additionally, data presented for the metrics are subject to finalization by CMS, which may result in changes from previously reported metrics.
Key metrics Dialysis Care Services
Nine months ended September 30
unaudited Clinics Growth in % De novos Patients Growth in % Treatments Growth in %
Total 3,579 5 % 80 306,366 5 % 34,654,614 4 %
North America 2,277 3 % 49 187,611 4 % 21,551,727 5 %
EMEA 701 8 % 15 59,233 10 % 6,594,063 8 %
Asia-Pacific 369 15 % 12 29,358 13 % 2,956,107 5 %
Latin America 232 1 % 4 30,164 0 % 3,552,717 -4 %
North America EMEA Latin America Asia-Pacific
in % of patients Q3 2016 Q2 2016 Q3 2016 Q2 2016 Q3 2016 Q2 2016 Q3 2016 Q2 2016
Clinical Performance
Single Pool Kt/v > 1.2 97 98 96 96 93 92 x 97
No catheter (> 90 days) 86 84 81 81 81 82 x 91
Hemoglobin = 10-12 g/dl 73 73 77 77 52 52 x 58
Hemoglobin = 10-13 g/dl 79 78 77 77 67 69 x 66
Albumin > 3.5 g/dl 1) 77 81 91 90 88 90 x 87
Phosphate < 5.5 mg/dl 64 63 76 76 76 77 x 71
Calcium = 8.4-10.2 mg/dl 84 83 75 73 75 74 x 75
Hospitalization days 9.8 10.0 9.4 9.4 3.7 3.6 x.x 4.0
Demographics
Average age (in years) 63 62 64 64 58 59 x 64
Average time on dialysis (in years) 4.0 3.9 5.6 5.6 5.2 5.2 x.x 5.0
Average body weight (in kg) 83 83 72 73 68 68 x 63
Prevalence of diabetes (in%) 61 61 32 32 26 25 x 44
1) International standard BCR CRM470
Reconciliation of non U.S. GAAP financial measures to the most directly comparable U.S. GAAP financial measures
Three months ended September 30 Nine months ended September 30
in US$ million, unaudited 2016 2015 2016 2015
Delivered EBIT reconciliation
Total
Operating income (EBIT) 670 614 1,851 1,665
less noncontrolling interests (73 ) (84 ) (217 ) (207 )
Delivered EBIT 597 530 1,634 1,458
North America
Operating income (EBIT) 536 515 1,486 1,284
less noncontrolling interests (70 ) (80 ) (210 ) (199 )
Delivered EBIT 466 435 1,276 1,085
Care Coordination
Operating income (EBIT) 31 33 66 85
less noncontrolling interests (5 ) (11 ) (22 ) (33 )
Delivered EBIT 26 22 44 52
Dialysis
Operating income (EBIT) 505 482 1,420 1,199
less noncontrolling interests (65 ) (69 ) (188 ) (166 )
Delivered EBIT 440 413 1,232 1,033
EMEA
Operating income (EBIT) 125 130 395 405
less noncontrolling interests (1 ) (1 ) (2 ) (2 )
Delivered EBIT 124 129 393 403
Asia-Pacific
Operating income (EBIT) 85 68 225 219
less noncontrolling interests (2 ) (3 ) (5 ) (6 )
Delivered EBIT 83 65 220 213
Latin America
Operating income (EBIT) 20 (8 ) 47 25
less noncontrolling interests
Delivered EBIT 20 (8 ) 47 25
Corporate
Operating income (EBIT) (96 ) (91 ) (302 ) (268 )
less noncontrolling interests
Delivered EBIT (96 ) (91 ) (302 ) (268 )
Reconciliation of net cash provided by operating activities to EBITDA 1)
Total EBITDA 2,424 2,202
Interest expense, net (308 ) (304 )
Income tax expense (471 ) (441 )
Change in working capital and other non-cash items (349 ) (45 )
Net cash provided by operating activities 1,296 1,412
Annualized EBITDA 2)
Operating income (EBIT) 2,519 2,333
Depreciation and amortization 755 724
Non-cash charges 101 74
Annualized EBITDA 3,375 3,131
1) EBITDA is the basis for determining compliance with certain covenants in Fresenius Medical Care s long-term debt instruments.
2) EBITDA: including largest acquisitions.
Reconciliation of non U.S. GAAP financial measures to the most directly comparable U.S. GAAP financial measures
Three months ended September 30 Nine months ended September 30
in US$ million, unaudited 2016 2015 2016 2015
Operating performance excluding one-time items
Total
Operating income (EBIT) 670 614 1,851 1,665
Special items 18 18
Divestiture of dialysis service business in Venezuela 26 26
Sale of European marketing rights for certain renalpharmaceuticals 1 (8 ) (8 )
Operating income (EBIT) excluding special items 670 632 1,851 1,683
North America
Operating income (EBIT) 536 515 1,486 1,284
Special items
Operating income (EBIT) excluding special items 536 515 1,486 1,284
EMEA
Operating income (EBIT) 125 130 395 405
Special items (8 ) (8 )
Operating income (EBIT) excluding special items 125 122 395 397
Asia-Pacific
Operating income (EBIT) 85 68 225 219
Special items
Operating income (EBIT) excluding special items 85 68 225 219
Latin America
Operating income (EBIT) 20 (8 ) 47 25
Special items 26 26
Operating income (EBIT) excluding special items 20 18 47 51
Corporate
Operating income (EBIT) (96 ) (91 ) (302 ) (268 )
Special items
Operating income (EBIT) excluding special items (96 ) (91 ) (302 ) (268 )
Total
Delivered EBIT 597 530 1,634 1,458
Special items 0 18 0 18
Delivered EBIT excluding special items 597 548 1,634 1,476
Net income 2 333 262 855 713
Special items 22 22
Divestiture of dialysis service business in Venezuela 27 27
Sale of European marketing rights for certain renal pharmaceuticals 1 (5 ) (5 )
Net income excluding special items 2 333 284 855 735
1 to our Joint Venture Vifor Fresenius Medical Care Renal Pharma
2 attributable to shareholders of FMC AG & Co. KGaA
Fresenius Medical Care AG & Co. KGaA
61352 Bad Homburg v. d. H.
Head of Investor Relations &
Corporate Communications
Tel. +49 6172 609 2601
Fax +49 6172 609 2301
Fresenius Medical Care AG & Co. KGaA
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Last updated: Oct 27, 2016