Struggles persist for FMC amidst flu outbreak - Optimism for the latter half of the year remains
Fresenius Medical Care (FMC), a leading global provider of dialysis products and services, is forecasting further significant operational and financial improvements in the second half of 2022. The company has also announced plans to initiate the first tranche of a €1 billion share buyback program in August 2022.
However, the company has faced a setback in its key market, the U.S., due to a severe flu season. This has resulted in slower treatment growth for FMC, with flat year-on-year same market treatment growth in the U.S. for the second quarter of 2022. The flu season led to elevated mortality among patients, causing a reduction in the patient population receiving treatment, which offset gains from new patient referrals.
Despite this challenge, FMC's revenue increased by 1% to €4.79 billion in the second quarter, and the adjusted operating result rose by 9% to €476 million. The savings program contributed €58 million to FMC's result in the last quarter.
FMC's CEO, Helen Giza, has been instrumental in stabilizing the company following the consequences of the corona pandemic, staff shortages, and rising costs. She has implemented a comprehensive restructuring, which has helped the company to stay on track with its growth targets.
For the full year 2025, FMC still targets low single-digit percentage currency-adjusted revenue growth and high teens to high twenties percentage currency-adjusted adjusted operating result growth. The company remains optimistic about its future, with Giza reporting an increase in the inflow of new dialysis patients for five consecutive months.
In other news, imported dialysis machines are exempt from tariffs due to trade agreements or the Nairobi Protocol. However, the further development of pharmaceuticals by FMC remains uncertain.
CEO Helen Giza has also expressed confidence about the impact of new tariffs in trade between the U.S. and the EU in 2022. The shares of FMC were the biggest DAX losers with a decline of almost 4% following the announcement, but the company has confirmed its full-year growth guidance.
In conclusion, while the severe flu season in the U.S. has negatively impacted Fresenius Medical Care's treatment growth, the company remains optimistic about its future. FMC now expects stagnating to slightly positive treatment numbers in the U.S. for the full year, down from a previous forecast of over 0.5% organic growth. The company continues to focus on its core business and strategic initiatives to drive growth and improve profitability.
- The CEO of Fresenius Medical Care (FMC), Helen Giza, is concurrently working on initiatives in the field of health-and-wellness, specifically focusing on dialysis, by addressing medical-conditions, such as severe flu seasons, to ensure optimal treatment for patients.
- Nevertheless, amid the financial landscape, FMC, a key player in the business sector, is planning a €1 billion share buyback program, demonstrating its strong financial position and commitment to return value to shareholders in the realm of finance.
- Despite the challenges stemming from the flu season and other macroeconomic factors, FMC's CEO, Giza, is eager to expand the company's footprint in the fitness-and-exercise sector by increasing the inflow of new dialysis patients and optimizing their health outcomes, thus driving growth and improving profitability.
