Michael Sen, CEO of FreseniusMichael Sen, CEO of Fresenius
  • Group net income drops 11%, with significant decline in constant currency.
  • Reported Group net income plummets due to valuation effects and additional expenses.
  • Excluding Medical Care, net income before special items falls 13%.

Bad Homburg v.d.H., Germany – Fresenius, a leading healthcare company, announced on Wednesday a significant decrease in its Group net income before special items for the fourth quarter of the fiscal year. The income decreased by 11% to €397 million, a stark contrast to the €445 million reported in the same quarter of the previous year. This decline, which intensifies to 17% in constant currency terms, is primarily attributed to increased interest expenses and a higher tax rate.

The reported Group net income suffered a more drastic fall, plunging to a loss of €614 million from a gain of €255 million in the same quarter of the previous year. This steep decline largely stems from a valuation effect associated with Fresenius Medical Care, as per the International Financial Reporting Standards (IFRS 5), amounting to €521 million. Notably, this effect does not influence the company’s cash flow.

Furthermore, Fresenius faced additional financial strains due to legacy portfolio adjustments, costs related to their efficiency program, and expenses incurred in the transformation of Vamed, a subsidiary focusing on project development and management in the health care sector. These factors collectively exerted a negative impact on the Group’s net income.

When considering the figures excluding Fresenius Medical Care, the net income before special items shows a decrease of 13%, down to €314 million from €362 million in the previous year’s fourth quarter. This reduction is even more pronounced in constant currency terms, reaching 22%.

The report highlights the challenges faced by Fresenius in a dynamic economic environment, marked by rising costs and tax rates. The company’s focus on navigating these challenges while maintaining its commitment to healthcare excellence remains critical.

General Context:
Fresenius’ financial performance reflects the broader trends in the global healthcare industry, where companies are grappling with fluctuating market conditions, regulatory changes, and evolving healthcare needs. The company’s ability to adapt to these challenges will be pivotal in its ongoing success and contribution to global healthcare services.

By Lisa Luckas

Lisa Luckas is a Sr. Business News Editor at Nobot.News.

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