Fresenius Medical Care Q1 2025 Earnings Call Transcript

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Operator

Ladies and gentlemen, welcome to the Q1 twenty twenty five of Fresenius Medical Care Earnings Conference Call. I'm Sandra, the Chorus Call operator. I would like to remind you that all participants have been listen only mode, and the conference is being recorded. The presentation will be followed by a Q and A session. The conference must not be recorded for publication or broadcast.

Operator

At this time, it's my pleasure to hand over to Doctor. Dominik Hader. Please go ahead, sir.

Dominik Heger
Dominik Heger
Executive VP and Head of Investor Relations, Strategic Development & Communications at Fresenius Medical Care

Thank you, Sandra. I would like to welcome everyone to our earnings call for the first quarter twenty twenty five. I know that this is a very tough day with many companies in the sector reporting today. Nevertheless, thank you for joining us today. As always, I would like to start out the call by mentioning our cautionary language that is in our safe harbor statement as well as in our presentation and in all the materials that we have distributed earlier today.

Dominik Heger
Dominik Heger
Executive VP and Head of Investor Relations, Strategic Development & Communications at Fresenius Medical Care

For further details concerning risks and uncertainties, please refer to these documents and to our SEC filings. As always, we will have sixty minutes for the call. To give everyone the chance to ask questions, we would like to limit the number of questions to two, like in the past, and it would be great if we could make it work again, as always. Let me now welcome Helen Geiser, CEO and Chair of the Management Board and Martin Fischer, our Chief Financial Officer. Helen, the floor is yours.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

Thank you, Dominic. I'd like to extend a warm welcome to everyone on the call. Thank you for your continued interest in Fresenius Medical Care. I'm pleased to report that we are off to a great start in 2025. Our first quarter performance further underscores the strength in the execution of our current strategic plan.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

With the start of the third and final year of our plan, I'm thrilled with our team's energy and focus, maintaining momentum and delivering continued operational and financial progress. I will begin my prepared remarks on Slide four. In the first quarter, we delivered strong organic revenue growth of 5% with positive contributions from both Care Delivery and Care Enablement. Despite a severe flu season increasing mistreatments, we realized stable same market treatment growth in The United States. This was possible due to continuously improving underlying referral trends, which was supported by the tremendous operational improvements made within care delivery.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

Our SME 25 transformation program continued its momentum delivering €68,000,000 in additional sustainable savings of our targeted €180,000,000 for the year. We achieved 11% operating income growth consistent with the expected phasing of our full year outlook, positioning us well for even greater growth in the quarters to come. Thanks to robust cash flow development and our strict financial discipline, our net leverage ratio improved to 2.8 times, which is well below our self imposed target range. While tariffs have certainly been a prominent topic this year to date, recent changes in tariffs did not have an impact in the first quarter. Also, for the financial year 2025, we currently expect only a very limited impact from both U.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

S. And any global retaliatory tariff. Overall, the first quarter developed well in line with our expectations, and we are therefore confirming our full year outlook. Turning to Slide five. Here, I would like to highlight recent developments in each of our operating segments, beginning with Care Delivery.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

In The US, the stable or very slightly positive volume development reflected a 40 basis point impact from mistreatment driven by the severe flu season. We experienced peak flu impact in February and March. Prior to that, we realized relatively strong volume development in January. At the same time, we are encouraged by the accelerating number of referrals, which have helped to offset the impact from flu related mistreatments. Throughout the quarter, we saw improving trends in patient referrals and the results of our operational improvements continuing from the second half of last year.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

This includes our efforts to streamline our admissions process and reduce patient cancellations. Therefore, we continue to expect same market treatment growth of point 5% plus for The US in 2025. While we have not given a specific phasing, we would expect a similar trajectory as last year with Q1 as the low point and stronger performance following throughout the year. While our same market treatment growth adjusts for the number of dialysis days, having one fewer dialysis day in the quarter creates a headwind for absolute volume development and utilization. In our international markets, we saw strong same market treatment growth accelerate to 2.5%.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

This is an encouraging indicator for these markets as well as an outlook for The US recovery. Our value based care business contributed to overall revenue growth. We saw lives under management increase from around a 30,000 at the end of twenty twenty four to around a 48,000 at the March. Despite headwinds from one less dialysis day and the severe flu season, we maintained our operating income development at a stable level. Our 2025 outlook anticipated a lower contribution from the first quarter in Care Delivery, so all in line with expectations.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

Our Care Delivery earnings were supported by favorable rate and mix development as well as a positive impact from phosphate binders. Within care delivery, we are continuing to prepare for the rollout of high volume hemodifiltration or HDF for short. In The US, our first US pilot program has grown from a few patients to 11 currently treated on our new 5008x machine. We are well positioned to expand that further as we approach the official launch at the end of the year. Turning to Care Enablement.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

After a strong Q4 last year, Care Enablement delivered a strong first quarter with solid volume growth in all regions and continued positive pricing momentum. We realized additional sustainable savings as part of our FME25 transformation program, driven by further optimization of our manufacturing and supply chain footprint. I'm pleased to report that our Care Enablement margin further improved to 8.3. For the first time, it entered its target margin band of 8% to 12%. While there is more work to be done, if you remember where we came from, this is a tremendous achievement and positions this segment for further growth and margin expansion beyond twenty twenty five.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

Not only from a care delivery perspective, but also from a care enablement perspective, we are actively preparing to bring transformational innovation to The U. S. Market with the rollout of the 5008x. We are well on track for the launch at the end of the year, and we look forward to sharing more detail at our CMD on June 17. I'll now hand over to Martin to take you through the first quarter financial performance in more detail.

Martin Fischer
Martin Fischer
CFO & Member of the Management Board at Fresenius Medical Care

Thank you, Helen, and welcome to everyone on the call also from my side. I'll pick up on Slide seven. In the first quarter, we achieved solid organic revenue growth of 5% with contributions from both segments. At constant currency, revenue increased by 1%. The muted revenue development reflects the successful execution of our portfolio optimization plan.

Martin Fischer
Martin Fischer
CFO & Member of the Management Board at Fresenius Medical Care

Divestitures negatively impacted our revenue development by two sixty basis points. As a reminder, we decided not to adjust our numbers in the fiscal year twenty twenty four and 2025 for the divestitures that were closed in those years. We decided to absorb the revenue and operating income effects of having sold the business in our guidance range for the respective year. Operating income, excluding special items, increased by 11% on a constant currency basis, primarily driven by growth in our Care Enablement segment. This reflects the expected phasing for our 2025 outlook.

Martin Fischer
Martin Fischer
CFO & Member of the Management Board at Fresenius Medical Care

Special items negatively affected group operating income by 126,000,000 This mainly includes costs relating to portfolio optimization and our FME25 transformation program as well as negative effects from the remeasurements of our investments in Humacyte. Next on Slide eight. This slide highlights the drivers of our year over year margin development. We realized a 90 basis point margin increase, largely driven by growth in our Care Enablement segment. This offset the slightly negative Care Delivery contribution, which reflected the impact of a severe flu season and one less dialysis day.

Martin Fischer
Martin Fischer
CFO & Member of the Management Board at Fresenius Medical Care

I will review the drivers when we look at the segments in detail. Favorable contributions from Corporate included the positive valuation effect of virtual power purchase agreements amounting to €3,000,000 in the first quarter. It is worth noting that foreign exchange translation had a beneficial effect on our business in the first quarter and contributed to the growth with €11,000,000 Moving on to Slide nine. Care Delivery showed strong organic revenue growth of 4%, driven by both Care Delivery U. S.

Martin Fischer
Martin Fischer
CFO & Member of the Management Board at Fresenius Medical Care

And Care Delivery International. In The U. S, our growing Value Based Care business supported revenue development along with favorable rate and payer mix development. This compensated for the muted same market treatment growth, reflecting higher levels of mistreatment driven by the flu season. As mentioned by Ellen, we also realized solid international revenue growth supported by accelerated same market treatment growth of 2.5% in those markets.

Martin Fischer
Martin Fischer
CFO & Member of the Management Board at Fresenius Medical Care

The revenue development was negatively impacted by one less dialysis day. Additionally, our portfolio optimization plan negatively impacted Care Delivery revenue development by three seventy basis points. We expect the headwind from our portfolio optimization to reduce over the course of the year. Despite the headwinds faced in this first quarter, Care Delivery maintained its operating income contribution at a stable level, even slightly expanding its margin to 9.3%. Earnings were supported by favorable rate and mix developments as well as the positive impact from Forswend Peitos.

Martin Fischer
Martin Fischer
CFO & Member of the Management Board at Fresenius Medical Care

Care Delivery earnings also benefited from SME 25 savings. These earnings developments were offset by labor and inflation costs in the quarter, which developed in line with our expectations. Let us have a closer look at the developments in Care Enablement on Slide 10. In the first quarter, Care Enablement continued to show strong revenue growth, supported by 5% organic growth. This development is mainly attributable to solid volume growth in all regions and continued positive pricing momentum globally.

Martin Fischer
Martin Fischer
CFO & Member of the Management Board at Fresenius Medical Care

In line with our expectations, volume based procurement in China was again supportive of volume growth, but a headwind to pricing. The segment showed a significant 49% increase in operating income, resulting in a margin increase of two forty basis points. With an 8.3% margin, Care Enablement also reached its target margin band. This reflected continued execution of our FME25 transformation program as well as improved volume and price effects, which more than offset anticipated deflationary pressures. Moving to Slide 11.

Martin Fischer
Martin Fischer
CFO & Member of the Management Board at Fresenius Medical Care

In the first quarter, the relatively low operating cash flow was driven by seasonality in invoicing, in line with our expectations. We realized a strong increase of 28% against last year's quarter due to improved operating working capital. Consistent with our current strategic priorities, we further reduced both our total debt and lease liabilities and total net debt and lease liabilities compared to the prior year period. As a result of our continued strict financial discipline, our net leverage ratio improved to 2.8x. We remain comfortable being below our self imposed target corridor of three to 3.5x.

Martin Fischer
Martin Fischer
CFO & Member of the Management Board at Fresenius Medical Care

Following the quarter end early April, we took advantage of the favorable market conditions and our improved credit rating outlook to successfully place two bond tranches with an aggregate volume of €1,100,000,000 We used some of the funds to buy back approximately €300,000,000 of bond maturing in 2026. We are planning to provide an update on our future capital allocation plans at our upcoming Capital Markets Day in June. I will now hand back to Helen to review our outlook.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

Thank you, Martin. I will pick up with our outlook on Slide 13. Given our first quarter performance and current expectations for the remainder of 2025, we are confident to deliver a strong performance in 2025 and are confirming our full year outlook. We continue to expect a positive to a low single digit percent revenue development and our Q1 operating income developed in line with our expectations as we anticipated a relatively lower contribution from the first quarter. Therefore, we expect operating income to grow by a high teens to high 20s percent rate compared to prior year.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

I will finish my prepared remarks on slide 14. Finally, I am looking forward to seeing many of you on June 17 in London for our Capital Markets Day. We plan to share the details of our strategy and capital allocation priorities. In addition, we have some interesting deep dive breakout sessions and a product show that we are excited about. If you have not already registered, please do connect with Investor Relations as our registration will close on May 15.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

With that, I will now hand back to Dominic to start the Q and A.

Dominik Heger
Dominik Heger
Executive VP and Head of Investor Relations, Strategic Development & Communications at Fresenius Medical Care

Thank you, Helen and Martin, for your prepared remarks. Before I hand over for the Q and A, as always, I would like to remind everyone to limit your questions to two. If we have remaining time, we could go second round. With that, I hand over to Sandra to open the Q and A, please.

Operator

Thank you, sir. Will now begin

Operator

the question and answer session. Thank

Dominik Heger
Dominik Heger
Executive VP and Head of Investor Relations, Strategic Development & Communications at Fresenius Medical Care

you, Sandra. The first question comes from Victoria from Berenberg. Victoria, the line is yours.

Victoria Lambert
Equity Research Analyst at Berenberg

Thanks for taking my question. The first one is just on what you are seeing in April trading so far in The U. S. I know Q1 was pretty volatile, so just an update on April would would be helpful and how this gives you confidence to reiterate your full year guidance, for the 50 bps or more of growth. And then the second question is just on phosphate binders.

Victoria Lambert
Equity Research Analyst at Berenberg

What benefit did those have in q one? And do you still expect the, I think, 50,000,000 to 100,000,000 operating income benefit for the full year?

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

Victoria, I'll take the first question, and Martin can take the second question on the binders. Yeah. Obviously, the flu season hit hard in in February and March. It rose pretty quickly and came back down. We are encouraged by what we see with the underlying referrals.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

That is a very a very strong leading indicator for us. I think what we'll also see in q two is the, you know, the mortality effect, you know, obviously, with the six to eight week lag on the on on the flu data. Obviously, we haven't seen, you know, that kind of data fully for for April yet. I think we've even closed the month yet. So but we're encouraged by, you know, the kind of weekly numbers that we're seeing, and we would expect that underlying inflow trend to continue.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

And we do feel confident with the phasing that we always see in Q1 that we will continue on a positive trajectory through the end of the year and confident with our 0.5 plus for the year.

Martin Fischer
Martin Fischer
CFO & Member of the Management Board at Fresenius Medical Care

Yes. And Victoria, on the phosphate binders. So quarter one developed in line with expectations, and we have outlined the full fiscal year effect. And given that with the phosphate binders going to the bundle, the ASPs used to start higher and then only being going downwards and revised throughout the fiscal year, we did see a seasonal or a stronger start into the fiscal year and had a double digit million effect that contributed to the positive quarter.

Victoria Lambert
Equity Research Analyst at Berenberg

Thanks so much.

Dominik Heger
Dominik Heger
Executive VP and Head of Investor Relations, Strategic Development & Communications at Fresenius Medical Care

Thank you. The next caller is Victoria from Citi. Welcome back, Victoria. Sorry, Veronika. Welcome back.

Dominik Heger
Dominik Heger
Executive VP and Head of Investor Relations, Strategic Development & Communications at Fresenius Medical Care

See, even I even missed your name. You've been a long away so long. Welcome back.

Veronika Dubajova
Veronika Dubajova
Managing Director at Citi

Thank you, Dominic. And hey, Helen and Martin. Great to be back. Thanks for taking my questions. I'll keep it to two, please.

Veronika Dubajova
Veronika Dubajova
Managing Director at Citi

The first one is just the revenue per treatment trend in the first quarter in The U. S. It seems like it held up particularly well. Just curious, Helen, if you can give us an update on what you're seeing from a commercial perspective and for Medicare Advantage and whether this is something that is sustainable and, I guess, to what extent it is flattered by the phosphate binder dynamic. So that's my first question.

Veronika Dubajova
Veronika Dubajova
Managing Director at Citi

And my second question is around Care Enablement. Congratulations in getting the margin into the target band. Martin, are you able to give us a bit of color on what was the contribution from pricing to revenue growth and profitability? And how much scope there is to do more as we go go through this year? Thank you, guys.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

Welcome back, Veronica. I'll take the first one on RPT. Yeah. Look. We are seeing continued price and and mix improvement in development there.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

Obviously, you know, with the with the PPS rate increase as well as the you know, what we have always, spoken to this past year or so about kind of moderate price increases, that 1% to 2% price increase across the full portfolio of payers. So I think what we're comfortable with how that trend is developing. And obviously, that revenue is developing in line with our expectations for the quarter. Martin, do you want to take Care Enablement?

Martin Fischer
Martin Fischer
CFO & Member of the Management Board at Fresenius Medical Care

Yes. So, Veronica, you saw from the bridge we provided that business growth was a significant contributor. We also stated that overall pricing is developing in line with expectations. And globally, is it positive and contributing, And we also see that positive momentum that you saw last year also carrying forward in the quarter. To double click a bit on that, this includes the China effect.

Martin Fischer
Martin Fischer
CFO & Member of the Management Board at Fresenius Medical Care

And the China effect, as you remember, was in the second half last year about a mid double digit number. And you see the annualization of the China effect now also for quarter one, and you can also expect that for quarter two until we have the full cycle of the year. The important thing to note is that the volume contribution that we expected is developing according to our expectations. And even including the negative China headwind, we do see a robust solid pricing momentum in the quarter as well. And I hope that gives a bit of color.

Veronika Dubajova
Veronika Dubajova
Managing Director at Citi

Martin, maybe I can just push back on that a little bit. I already asked for a little bit more detail. Obviously, you do have a large customer who should be, I believe, paying some higher prices as of this year. Are you able to tell us how those negotiations have progressed and whether we're seeing the full impact of that already in Q1?

Martin Fischer
Martin Fischer
CFO & Member of the Management Board at Fresenius Medical Care

Veronika, I hope you understand that we do abstain from commenting on individual contracts.

Veronika Dubajova
Veronika Dubajova
Managing Director at Citi

I got it. I had to try. Thanks, guys.

Martin Fischer
Martin Fischer
CFO & Member of the Management Board at Fresenius Medical Care

Okay. Fair enough.

Dominik Heger
Dominik Heger
Executive VP and Head of Investor Relations, Strategic Development & Communications at Fresenius Medical Care

Thank you, Veronika. The next question comes from Graham from UBS. Graham, the line is yours.

Graham Doyle
Graham Doyle
Executive Director, Equity Research at UBS Group

Hi, guys. Good afternoon. Thanks for taking my questions. Just one on HDF first and then on volumes and margins. In terms of how you're thinking about pitching this to competitor clinics or or service providers, is it primarily the overall mortality benefit, or is there nuance as to which patients might benefit?

Graham Doyle
Graham Doyle
Executive Director, Equity Research at UBS Group

And then is there actual, you know, just operational benefit in terms of lower training costs, things like that? Just to understand as we get close to the launch, how you're you're pitching that once you go commercial. And and then on margins, we you've obviously had phenomenal success in the last two years in terms of expanding margins, But that's been effectively without any US volume growth. And it's kind of a rough number, but what do you think going forward when you get to a sort of normalized recovered margin? What do you think you need to grow at to sustain in terms of US volumes to sustain that margin?

Graham Doyle
Graham Doyle
Executive Director, Equity Research at UBS Group

And when does, like, operating leverage kick in? Is it like 1%, two %? Do we need get back to 3%? Just to understand how that moves. I appreciate both of those might be a little bit early for where we are today versus Capital Markets Day, but I thought I'd try.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

Thanks, Graham. I'll take both of those. And, obviously, that will be a significant part of our Capital Markets Day and kind of getting into, you know, kind of the the the innovation and the benefits that we see for HDF. I can click on that a little bit. And, of course, the same with the the the margin outlook.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

We'll give more color there. But just to kind of double click for a moment, you know, for HDF, as as I think, you know, we've been talking about this past year, we're incredibly excited about about this, you know, new machine and the new the, you know, the kind of the the new treatment. The a little bit of both on what you touched on, not just the, you know, the mortality improvement, which if we do see that, you know, the the kind of the results from CONVENSE at twenty three percent improvement in mortality, that in itself full full blown could relate, you know, to, you know, kind of 400 basis points of growth by itself, not just the patient benefit. You know? And, look, obviously, improving outcomes is a big part of what we do as as as the leading innovator here.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

But, also, there are operational benefits from from the machine. It is much simpler to use. It doesn't need saline. The clean downtime is quicker. No time needed between treatments, and training time is is also better.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

So we'll go through that in a ton more detail in June, but I think, you know, we can kinda clearly see a a number of treatment benefit and an operational benefit. So I think you can see why we're excited and, you know, why we're looking for the whole industry to to adopt this treatment. You know, in terms of your second question, yeah, of course, we've been driving efficiencies, and I think the result of the new operating model has really lent itself to the improvements that we've driven in the past two years. But you're right, that U. S.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

Volume growth, we've got there despite that. Obviously, we're looking to see and seeing that volume come back, and that will improve operating leverage clearly, the higher utilization. And obviously, we do expect to be growing above the zero and even the 0.5. We will give more outlook on how we're seeing these market and volume trends in June as well and kind of the levers that we see both to drive top line growth and innovation as well as bottom line margin expansion. So we're excited, and we're excited it's only a month or so away now, but we'll clearly give more give more insight to to the market then.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

And thanks for the questions, Graham.

Graham Doyle
Graham Doyle
Executive Director, Equity Research at UBS Group

Great. Thank you, guys.

Martin Fischer
Martin Fischer
CFO & Member of the Management Board at Fresenius Medical Care

Thank you, Graham.

Dominik Heger
Dominik Heger
Executive VP and Head of Investor Relations, Strategic Development & Communications at Fresenius Medical Care

The next roundup question comes from Lisa from Societe Generale, Bernstein.

Lisa Bedell Clive
Senior Research Analyst at Bernstein

Hi there. Nice quarter to start the year. Two questions. Your large competitor in The US has talked about significant CapEx investments over the past sort of five plus years really focused on IT systems. And given that both companies were formed over a series of acquisitions, I imagine that's one area that could still be quite messy.

Lisa Bedell Clive
Senior Research Analyst at Bernstein

Just curious as to where you are on that sort of transformation. And I think of note, David has mentioned it's been particularly useful in terms of their revenue cycle management in the private market, and so I just wanna think through what the opportunities for Fresenius could be on that front. And then second, just on the HDF launch, how should we think about the ramp up? You know, there's obviously a long replacement cycle for machines. So should we just expect penetration of of HDF to increase quite gradually despite the the sort of patient benefits and, as you mentioned, the operational benefits?

Lisa Bedell Clive
Senior Research Analyst at Bernstein

Just and and lastly, just on that, what sort of manufacturing capacity will you have for serving The US market, and should we worry about any potential bottlenecks there? Thanks very much.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

Thanks, Lisa. Martin, do you wanna take the first one on the capital allocation and IT, and I'll take the second?

Martin Fischer
Martin Fischer
CFO & Member of the Management Board at Fresenius Medical Care

Yeah. Happy to, Lisa. So first of all, IT and also driving automation of our processes and efficiencies and also revenue cycle management together with EHR systems is a focused topic of ours as well because of this being a value creation level, both on the efficiency side but also on the revenue yield. So this has been for quite some time as well. And as we continue to invest into our business, we will also here give a little bit more color allocation priorities, both how we drive profitable growth and improve profitability going forward at the Capital Market Day as well.

Martin Fischer
Martin Fischer
CFO & Member of the Management Board at Fresenius Medical Care

But rest assured, this has been already a focused topic and will continue to be a focused topic also to invest into operational efficiencies.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

Thanks, Martin. Lisa, the full rollout plan and how we're thinking about commercialization, both from a care enablement and care delivery, we will share at Capital Markets Day and, obviously, the, you know, the capital piece on that as well. Obviously, this is while it's, you know, exciting and unique innovation, it is also replacing an installed base. So as you can appreciate, the, you the kind of the strategic approach here has been weighing up, you know, kind of the implementation and rollout plan versus the install the current installed base. But we'll give you more color into all of those questions that you had in June with quite a detailed breakout session on HDF, and you can see the machine.

Lisa Bedell Clive
Senior Research Analyst at Bernstein

Great. Thanks. Look forward to seeing you next month.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

Likewise.

Dominik Heger
Dominik Heger
Executive VP and Head of Investor Relations, Strategic Development & Communications at Fresenius Medical Care

Thank you.

Dominik Heger
Dominik Heger
Executive VP and Head of Investor Relations, Strategic Development & Communications at Fresenius Medical Care

The next question comes from James from Jefferies. James, the line

Dominik Heger
Dominik Heger
Executive VP and Head of Investor Relations, Strategic Development & Communications at Fresenius Medical Care

is

James Vane-Tempest
Senior Equity Analyst at Jefferies & Company Inc

for taking my question. Just a couple, please, if I may. Firstly, when we look at the operating growth of around 11% in constant currency, at the EBITDA level in constant currency, I think it's just under 4%. So I think adjusted D and A was down materially, which is about half the margin gain. So we are at the run rate we can expect for 2025.

James Vane-Tempest
Senior Equity Analyst at Jefferies & Company Inc

And what are the considerations there, please? And then my second question is, again, just on the 05/2008 X. You mentioned in terms of getting preparations for launching at the end of the year. But just wondering when we might get more detail on either pricing, what sort of feedback you've got in The U. S.

James Vane-Tempest
Senior Equity Analyst at Jefferies & Company Inc

Ahead of potential upgrades and how we should think about an upgrade cycle. Yes.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

Martin, do you

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

want to take the first one?

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

I'll come back to 5,008 x.

Martin Fischer
Martin Fischer
CFO & Member of the Management Board at Fresenius Medical Care

Yes, more than happy to. So on the D and A, I think it's important to note that when you look at the reported numbers, there's a significant portion and element of last year's divestitures in that, which equates to most of the reduction that we saw. And hence, when you look at it in a percentage of revenue, it is not such a large extent where it comes down. It does come down a bit in the quarter. But at the same time, the maturity, which was back then over EUR 100,000,000 hit coming out of that, which we also disclosed, was driven in the depreciation and amortization by the divestitures.

Martin Fischer
Martin Fischer
CFO & Member of the Management Board at Fresenius Medical Care

Overall, the DNA is for us a stable development, where we do plan for a, let's say, also sustainable reinvestment into predominantly our clinics as well as our machines as we place them as well, next to our continued R and D investment in C and E. And also here on the capital allocation priorities for the innovation, we will give additional color also for the Capital Markets Day.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

James, on your question about launch, probably the theme of my day, more on June 17. But no, look, we are and the fact that we now have 11 patients, which, you know, all in one clinic getting the the HDF treatment is giving us, you know, kind of real real data in real time. And, obviously, trying to get that that proven experience in our clinics also helps with the, you know, the commercialization to to other players in the in the industry. Obviously, here, the pricing is kind of contract by contract and probably not gonna disclose that. But I think what we are seeing and hearing as well, and we saw it in the CONVINCE study, is for our patients, not just the hard outcomes that, you know, we've we've talked about, like, mortality, but also their own quality of life measures and how much better they are feeling.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

It's quite we hope to share some of this. I think we have videos lined up, but how the patients are feeling from getting this treatment as well. So, you know, we are seeing that patients really want to be on on this treatment after that kind of, you know, seeing what's happening in the pilot. So more to come. We're we're we're thrilled to be rolling this out.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

And, obviously, we'll give as much detail as we can while keeping what we need to keep proprietary proprietary, if that makes sense. But, yeah, look forward to seeing you next month to and sharing more on that.

James Vane-Tempest
Senior Equity Analyst at Jefferies & Company Inc

That's great. Thanks so much.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

Bye.

Dominik Heger
Dominik Heger
Executive VP and Head of Investor Relations, Strategic Development & Communications at Fresenius Medical Care

Thank you, James. The next caller is Oliver from AutoBehive. Oliver, the line is yours.

Oliver Metzger
Equity Analyst at ODDO BHF AG

Yes. Good good afternoon. Thanks for taking my questions. First one is about a deeper view on the same market treatment growth in US. So the peak of flu season was early to mid February.

Oliver Metzger
Equity Analyst at ODDO BHF AG

So the six week cycle should have come to an end somewhere in April. Have you seen an excessive mortality, or was the negative impact more about that the patient stayed longer in hospices and were consequently not available for treatments in your clinics? The second one is on the current foreign exchange environment. Can you give us your view if the euro US dollar remains at the level as it stands right now? What might be the what will be the impact on top and bottom line?

Oliver Metzger
Equity Analyst at ODDO BHF AG

Thank you.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

Sorry. I'm both pressing mute here. Hi, Oliver. I'll take the first one on same market treatment growth growth. Yeah.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

Look. We did see the numbers in, you know, the February, the the spike. We started to see it come down in March. We haven't you know, we're still getting data in real time. I'd say too soon to say that anything has changed.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

You know, we've still seen that slightly elevated mortality. What the full impact was from the flu season, I don't think we'll start to see that until May. So obviously, when we get to q two, we'll be able to see how that trend is continuing. But, yeah, too soon for us to tell at this point. You know, what we saw in q one, obviously, was still elevated, but the flu data with the six to eight week lag will be later.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

Martin, do you want to take the answer?

Martin Fischer
Martin Fischer
CFO & Member of the Management Board at Fresenius Medical Care

Yes. Hi, Oliver. On the FX, I mean, obviously, in the current environment, it's very hard to predict where the U. S. Dollar will go with the volatility that we see.

Martin Fischer
Martin Fischer
CFO & Member of the Management Board at Fresenius Medical Care

At the same time, let me give you some color how we think about it and how we also here specifically on the translation topic that it is for us, have started the year and see the rest of the year. In the quarter one, for us, the average rate was about at 1.05%. And you also saw that in quarter one, we had a positive FX tailwind to the results. At the same time, we ended the quarter at a spot rate of 1.8%, which is pretty much in line with the indication that we gave to you for the outlook when we shared our assumptions for 2025 with us. And I think currently, when you look at it today or in the last couple of days, we are hovering around to the 1.13 ish.

Martin Fischer
Martin Fischer
CFO & Member of the Management Board at Fresenius Medical Care

And when you would expect that we stay at a similar level, that would, for us, mean about a two to 3% headwind on the top and bottom line for the full fiscal year 2025. And I hope that helps a bit of color.

Oliver Metzger
Equity Analyst at ODDO BHF AG

Absolutely. Thank you.

Martin Fischer
Martin Fischer
CFO & Member of the Management Board at Fresenius Medical Care

Yes.

Dominik Heger
Dominik Heger
Executive VP and Head of Investor Relations, Strategic Development & Communications at Fresenius Medical Care

You. Next question comes from Hugo from BNP. Hugo, the line is yours.

Hugo Solvet
Executive Director - Equity Research - Medical Technologies & Services at BNP Paribas

Thanks, Dominik. Hi, guys, and congrats on the quarter. I have three questions, please. First, on tariffs, I know probably not very material for you, but could you help us understand a bit more what the impact could be should things change at the July? Second, follow-up on Lisa's question.

Hugo Solvet
Executive Director - Equity Research - Medical Technologies & Services at BNP Paribas

Your US competitor also suffered a cigar attack earlier in April. Just wondering if you could comment on anything you've seen that would impact you positively more patient or increasing resource, for example? Keen to get your thoughts on that. And lastly, on volumes, if I'm not mistaken, you mentioned 40 bps tailwind on U. S.

Hugo Solvet
Executive Director - Equity Research - Medical Technologies & Services at BNP Paribas

Volumes from referral in Q1. Or should we think about this accelerating potentially throughout the year? Yes.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

Thanks, Hugo. I think I can I'll tag all of those. First, on tariffs. As you I know, you heard in the talk outline, no impact in Q1, and we're calling it somewhat limited for full year. For the manufacturing, so the consumables are kind of produced in The U.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

S. We do have machines that are coming in from Germany and or final assemblies in Mexico. I think if it's a result of all that we've done with SME25 and kind of rebuilt our manufacturing footprint and supply chain, we're pretty resilient here. So we see the impact as limited. Clearly, with the USMCA agreements as well as other protocols that are in place, we, you know, we feel pretty good about what we are seeing.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

Look. I think the broader question is, you know, what does this do ultimately to, you know, kind of inflation or, you know, labor rates? And, obviously, we would be looking to see what we, you know, what we would need to pass on in in pricing. But at that at this point, from what we can see through 2025, we're feeling pretty good. And as you can appreciate, a lot of work being done on the flows of materials and the relative impact in scenarios.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

So a special call out to the Tariff Task Force for the great work that they've done here. Your second question regarding the cyber attack on DaVita and what we are seeing, Clearly, not going to comment on kind of how what impact that's had there for them. But we have seen during the quarter some benefit in Q2, I should say, not Q1, some benefit from additional patient referrals. What that translates into, we'll we'll see when we close April. But, you know, obviously, our priority is making sure that patients get get the care they need.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

And I think, you know, the work that we've done on accelerating and improving our admissions process and patient inflows is is clearly, you know, working in our favor. Your third point on the 40 bps impact, that was from a negative mistreatment, not from inflow. What we're saying is the accelerated inflow has neutralized the mistreatment impact that was mainly due to flu. So we're flat with a 40 BEP headwind, if you will, from flu, which is also supported by the underlying inflow that we that we are seeing.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

Hope that helps.

Dominik Heger
Dominik Heger
Executive VP and Head of Investor Relations, Strategic Development & Communications at Fresenius Medical Care

And

Dominik Heger
Dominik Heger
Executive VP and Head of Investor Relations, Strategic Development & Communications at Fresenius Medical Care

the next question comes from Marie Young from Bank of America.

Marianne Bulot
Marianne Bulot
Analyst at Bank of America

Good afternoon and thank you for taking my questions. The first one is, could you talk a little bit about the remaining SME 25 savings that you expect for the rest of this year? I've noticed that you have already delivered a large chunk into Q1. So just wondering a little bit where do you see the most of the remaining saving coming from? And what do you need to deliver them?

Marianne Bulot
Marianne Bulot
Analyst at Bank of America

And then a bit more of a broader question on the company, and appreciate that might be further discussed at the CMD. But as you look into your portfolio, have you identified or are you still working on identifying other assets that aren't growing as profitably as you would like and that you could potentially sell over the midterm? Thank you.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

Thanks, Marianne. Martin, do want to take the SME 25, and I'll take the

Martin Fischer
Martin Fischer
CFO & Member of the Management Board at Fresenius Medical Care

More than happy. Marianne, as you saw in the quarter, we had a good quarter contribution and also with the EUR 68,000,000 and the total year of EUR 180,000,000, euros we feel that we started well. The phasing of that was in line with our expectations. And also, when we give additional color on that, you do see further contributions from the Care Enablement, also from the manufacturing and supply chain footprint optimization that we have, but also some further contributions from the G and A functions as well as CD to a smaller extent. We continue to see that structure also holding through the remainder of the year.

Martin Fischer
Martin Fischer
CFO & Member of the Management Board at Fresenius Medical Care

And the overall phasing, as I said, is in line with our expectations and should give us good confidence or gives us good confidence for the fiscal year target.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

Yes. Regarding your question on divestitures, so really, really pleased and proud of the progress the teams have made over these last two years in cleaning up the portfolio. As you would have seen in the Q1, we'd already announced that at Folio, the Spectralabs in Malaysia, kind of the two in the quarter. I'd say for the most part, we're done. I mean, we obviously, as part of our ongoing review of our country portfolio, we'll look to make sure that there's nothing, you know, that that's changing in the environment, that would change our view on any small market.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

But I feel I feel good about where we are, and that's part of our new rigor and discipline that we will continue to look at the performance of the assets to make sure they're performing as they need to. I think we're very clear of what is core and the work that we need to do to to continue to drive the improvement in the core. And again, I think you can kind of see how streamlined that has now become compared to where we were two years ago. Again, we can share more on that in June.

Marianne Bulot
Marianne Bulot
Analyst at Bank of America

Thank you very much.

Dominik Heger
Dominik Heger
Executive VP and Head of Investor Relations, Strategic Development & Communications at Fresenius Medical Care

Thank you, Marianne. The next question comes from Richard from Goldman Sachs. Richard, the line is yours.

Richard Felton
Richard Felton
Equity Research Analyst at Goldman Sachs

Thanks very much. Thanks for taking my question. Just two for me, please. The first one is a follow-up on the treatment volume dynamic and the strong referrals you mentioned. Could you just tell us where we are on the growth of new starts today and how that compares to this time last year?

Richard Felton
Richard Felton
Equity Research Analyst at Goldman Sachs

That's the first question. And then the second one, it's been a while now, but could you just comment if you've seen any changes in

Richard Felton
Richard Felton
Equity Research Analyst at Goldman Sachs

the

Richard Felton
Richard Felton
Equity Research Analyst at Goldman Sachs

competitive dynamic or potential opportunities that have been created by Baxter sale of Avantive to Carlyle? Thank you.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

I I don't know if I have that treatment volume year over year. And let me see if we can snag that as we're talking here. Martin, Dominic, I didn't pull that for me here. In terms of the competitive dynamic, obviously, you know, we both participate in different parts of, you know, of of the you know, whether it be of the whole market, whether it be PD or HHD, you know, we're we're happy we're always happy to have the competition. And I think that, you the focus lens that Vantiv is bringing is good for the overall market.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

We feel very proud of the work that we are doing, and I think the progress that we are seeing in terms of volume growth across all regions, pricing, acceleration, and margin expansion really speaks the kind of how we see our own product asset and the work that we're doing. So we are obviously significant market share in HHD. We're clearly number two in PD, but, you know, we think that there's, you know, space for both companies to to compete and operate. And, you know, we we're very clear of what the potential is and what we can do. So, yeah, it's focused on focused on what's in our control and how we can continue to drive this business and the progress, I think, speaks for itself there.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

Thank you. I'm glad you're pulling the same market treatment growth. I think on the referrals, on the phasing, what we are seeing is that it has improved every month, but year over year, you know, the referrals are down. I think, you know, the the challenge we have in q one is there's one less dialysis day, and so that's one day less for accepting new patients. But we are we're very pleased with the progress we are making.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

And I think the other piece that we are seeing here, you know, clearly on on the admissions and the work that we've been doing on getting new patients and getting them admitted and keeping them in the in the clinics is obviously the operational turnaround taking hold here. So, you know, I I kinda think that, you know, the the leading indicators are going in the right direction.

Richard Felton
Richard Felton
Equity Research Analyst at Goldman Sachs

Great. Thanks very much, Alan.

Dominik Heger
Dominik Heger
Executive VP and Head of Investor Relations, Strategic Development & Communications at Fresenius Medical Care

Okay. Thank you, Richard. The next question comes from David from JPMorgan. David, the line is yours.

David Adlington
David Adlington
Analyst at J.P. Morgan

Hey, guys. Thanks taking the questions. Most have been asked already, but maybe I could just push you a little bit more on the phosphate volumes in the quarter. If you could clarify that double digit, it's quite a wide range, how much you saw in Q1 and just confirm that you're happy with that 50 to $100,000,000 still. And then I think just from that, obviously, $12,000,000 improvement in care delivery EBIT, Basically, that all comes from phosphate biology just a follow-up there.

David Adlington
David Adlington
Analyst at J.P. Morgan

And then secondly, wider one. Are you seeing anything in the in the new US Administration on the Medicare side or on the regulatory side that is concerning? Thanks.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

Martin, do you want to take the binder?

Martin Fischer
Martin Fischer
CFO & Member of the Management Board at Fresenius Medical Care

Yes, I'll take the binder one. To also reiterate a bit, we did give an indication of an effect for the full year of about €100,000,000 And also, I did say that for quarter one, we have always anticipated quarter one to be a bit stronger contribution because of how the mechanics work and also starting out with a higher ASP assumption and then having ASPs being reduced throughout the year consistently. So also here, we have seen a double digit contribution or double digit million contribution in the quarter, as we called out on the profitability side. And this is across all assets in our portfolio. We have given the color that it is more a positive on the pharma and the clinics business and the negative on the pharmacy business.

Martin Fischer
Martin Fischer
CFO & Member of the Management Board at Fresenius Medical Care

So I hope that additional color helps.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

Yeah. Damon, a few questions on the new administration. Obviously, we're all navigating all those changes. The color that we've got today is, not expecting to see changes on, you know, on the base, you know, kind of Medicaid or Medicare programs or, you know, the participation in in kidney care or anything changing. Obviously, you know, we have seen some targeted cuts in other parts of health care, but, you know, what we are what we are seeing on our core business looks fine.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

I mean, there were some early changes of models that that there was the the only, you know, that tangible change of the ETC models that were ending by the end of twenty twenty five. That was a mandatory model. Actually, that worked out quite, you know, quite well for us, minimal impact. So that's all we have seen and heard. But, of course, you know, the the conversations and, you know, the kind of the yeah.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

Just the relationships building and continue in in in DC. But a lot of our input says, you know, that, you know, those big changes that, you know, the president has said out of the scope seem to be off the table, which is but, obviously, we continue to monitor.

David Adlington
David Adlington
Analyst at J.P. Morgan

Yeah. Thank you.

Dominik Heger
Dominik Heger
Executive VP and Head of Investor Relations, Strategic Development & Communications at Fresenius Medical Care

Okay. Good. Thank you, David. The next question comes from Robert from Morgan Stanley. Robert, the line is yours.

Robert Davies
Robert Davies
Executive Director at Morgan Stanley

Yes. Thanks for taking my questions. Just a couple left. One was just on the equipment business and the margin profile through the year. How should we think about that?

Robert Davies
Robert Davies
Executive Director at Morgan Stanley

And you've seen two or three quarters now that margin has been building quite nicely. Is there any seasonality at all in that business we should think about heading through the year? Is that we just assume that 1Q is a sort of base level and and it's upwards from here? And then the only other one I had left was just around return on capital employed. I think you put in a a slide on that towards the back of the pack.

Robert Davies
Robert Davies
Executive Director at Morgan Stanley

Just thinking about some of the key elements of driving that ROC back up into this high single digit territory where you were maybe seven or eight years ago. What are the key elements do you think in terms of getting there from where you are today? Is it just the operational leverage of the business as the growth comes back? Are there other elements as well?

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

Thanks,

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

Robert. I'll take the first one, and Martin can take second Yes. Look, we don't guide by segment within the year, but we've made it very clear that Care Enablement business, we have a margin band of eight to 12. And Q4 is typically the strongest. So starting Q1 at 8.3, I think you can expect that kind of we continue to improve that margin band, you know, kind of along the way this year.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

You know, what I'm excited to show is, you know, where we go from from here and where we see this med tech margin in the future. But, yeah, obviously, that will be June. But, yeah, I think passion for for this business over the year and, you know, the but we we always had like, we were starting from a 2% margin here. And I always said we have, you know, very definitive plans, all underpinned with initiatives. It would be back end loaded, and that's what we're seeing.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

But the, you know, the acceleration that we're seeing is a great testament to the care enablement team and and all that they're delivering both on SME 25, but also on volume and and, you know, kind of market share as well as pricing. So across the board, I feel that we are kind of, you know, kind of, you know, pulling on every cylinder there. So look forward to kind of showing the the outlook for this beyond 2025.

Dominik Heger
Dominik Heger
Executive VP and Head of Investor Relations, Strategic Development & Communications at Fresenius Medical Care

Jim?

Martin Fischer
Martin Fischer
CFO & Member of the Management Board at Fresenius Medical Care

So let me take the capital efficiency one, and thank you, Robert, for the question. So you have seen a nice recovery from our low in the 2023. And to your point, yes, this is partially on the back of the operational transformation and turnaround and the improvement of the profitability. And you can expect us to further drive profitable growth in that regard. So yes, a major part comes from the operational performance improvement.

Martin Fischer
Martin Fischer
CFO & Member of the Management Board at Fresenius Medical Care

The second piece actually is a continued stringent capital management. And yes, we do see still potential and continue to manage that capital efficiency piece also on the capital side. And when you saw the trajectory where we improved over a percentage point compared to 2023 that we have seen in Q1. I think you also see that those measures are taking effect, and we will continue to focus on further improving it. We are not happy with where we stand.

Martin Fischer
Martin Fischer
CFO & Member of the Management Board at Fresenius Medical Care

We have been very clear that we want to further improve and drive it also above the mid single digit margin at ROIC levels as well.

Robert Davies
Robert Davies
Executive Director at Morgan Stanley

Okay. Thank you.

Dominik Heger
Dominik Heger
Executive VP and Head of Investor Relations, Strategic Development & Communications at Fresenius Medical Care

Thank you, Robert. The next question comes from Paco from Deutsche Bank. Paco, the line is yours.

Falko Friedrichs
Falko Friedrichs
Director - Equity Research at Deutsche Bank

Thank you for taking my questions. Just a few quick ones. Firstly, on the improving referral process that you mentioned, that's good to hear. How far away is that still from where you would want to see it ultimately? Then second question on cost cutting.

Falko Friedrichs
Falko Friedrichs
Director - Equity Research at Deutsche Bank

Obviously, you've done a tremendous job over the recent past on that front. How much of a topic will that still be beyond this year? I know you're going to speak about it at the CMD, but maybe you can give us some initial flavor. I mean the house is still standing. You've taken a lot of cost out.

Falko Friedrichs
Falko Friedrichs
Director - Equity Research at Deutsche Bank

Is there still a lot more to go? You've just had divestments. You're sort of done with that. So on the pure cost cutting, what's to be expected beyond 2025? And then last but not least, on share buybacks.

Falko Friedrichs
Falko Friedrichs
Director - Equity Research at Deutsche Bank

Seems to be some excitement in the market that you might be announcing something big in terms of share buyback plans at the CMD. Is there anything you can say about that at this point, how you're looking at these, whether that's something you would at all consider going forward?

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

Falco, you made me smile. I'm glad

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

my house is still standing. But

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

we'll we'll tag team these questions. Look. In terms of the improving referral process, I mean, when we are all back to a 3% plus growth rate and we're seeing all the patients funnel from CKD refill, and we're snagging every patient that we can from any physician that is referring someone to us, then I think then then we get to a point where we're happy. Right? But until then, we'll continue to work and make sure our processes and, you know, the patient flows are are getting getting momentum along that way.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

And I feel like that's where we are we are finally starting to see, you know, that that proverbial light where our our internal processes are significantly improved. The flows are improving, but, you know, more importantly, that the the CKD funnel that, you know, has has been a bit of a an uncertainty to us through this COVID period or post COVID period, seeing that in in improvement is is key. You know, we we're obviously taking it a quarter quarter at a time on what we can what we can do there. In terms of the cost cutting, yes. Look.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

I I feel incredibly proud of what we've all accomplished on f m e '25, not just cost cutting, but really kind of streamlining the organization around the operating model or the new operating model and driving efficiencies. I think, you know, for us, where we see further opportunities to drive improvements and to invest in the company, we will take a look at those. And I think that would obviously be part of our outlook for June. And capital allocation, I know that's a big ask from everyone. A bit of a repeat answer.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

I'm sorry. More to come in June on what we we plan to do with that that capital and how we deploy it to to shareholders. At the end of the day, you know we're focused on value creation, and we'll give you insights into how we're thinking about that.

Falko Friedrichs
Falko Friedrichs
Director - Equity Research at Deutsche Bank

Okay. Thank you.

Dominik Heger
Dominik Heger
Executive VP and Head of Investor Relations, Strategic Development & Communications at Fresenius Medical Care

Okay. So thank you, everyone. That's the first in fifteen years of IR. We have four minutes left and no questions. So that is great.

Dominik Heger
Dominik Heger
Executive VP and Head of Investor Relations, Strategic Development & Communications at Fresenius Medical Care

We answered all questions. That's good. Thank you very much for listening in to our call. We'll go now very quiet until our Capital Markets Day for obvious reasons because it's the questions you will get answered at the Capital Markets Day. And we look forward to see you all.

Dominik Heger
Dominik Heger
Executive VP and Head of Investor Relations, Strategic Development & Communications at Fresenius Medical Care

Please register if you haven't, and we'll see you in London on the June 17, I hope.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

Yeah. Thanks, everyone. Look forward to seeing you in June. Take care.

Helen Giza
Helen Giza
Chair of Management Board & CEO at Fresenius Medical Care

Bye bye.

Martin Fischer
Martin Fischer
CFO & Member of the Management Board at Fresenius Medical Care

You. Take care. Bye bye.

Operator

Ladies

Operator

and gentlemen, the conference is now over. Thank you for choosing Chorus Call, and thank you for participating in the conference. You may now disconnect your lines. Goodbye.

Executives
    • Dominik Heger
      Dominik Heger
      Executive VP and Head of Investor Relations, Strategic Development & Communications
    • Helen Giza
      Helen Giza
      Chair of Management Board & CEO
    • Martin Fischer
      Martin Fischer
      CFO & Member of the Management Board
Analysts

Key Takeaways

  • Fresenius Medical Care delivered 5% organic revenue growth and an 11% operating income increase in Q1 2025, driving confidence in its full‐year guidance.
  • Despite a severe flu season causing ~40 bps of missed treatments, the US business achieved stable same-market treatment growth thanks to improving patient referrals and streamlined clinic operations.
  • The SME 25 transformation program generated €68 million in sustainable cost savings out of a €180 million annual target, while net leverage fell to 2.8×, well below the 3.0–3.5× target range.
  • Care Enablement posted robust volume growth, continued pricing momentum and delivered an 8.3% margin, its first entry into the target 8–12% band.
  • The company is preparing for the US launch of high-volume hemodiafiltration on its new 5008x machine, expanding its pilot from a few patients to 11 ahead of the year-end rollout.
AI Generated. May Contain Errors.
Earnings Conference Call
Fresenius Medical Care Q1 2025
00:00 / 00:00

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