Quarterly Financial Report of Fresenius Group

Transcription

1 Quarterly Financial Report of Fresenius Group applying United States Generally Accepted Accounting Principles (U.S. GAAP) 1 st Quarter 2015

2 2 TABLE OF CONTENTS 3 Fresenius Group figures at a glance 5 Fresenius share 6 Management Report 6 Health care industry 6 Results of operations, financial position, assets and liabilities 6 Sales 7 Earnings 8 Investments 8 Cash flow 9 Asset and liability structure 10 Business segments 10 Fresenius Medical Care 11 Fresenius Kabi 12 Fresenius Helios 13 Fresenius Vamed 14 Employees 14 Research and development 14 Opportunities and risk report 15 Subsequent events 15 Rating 15 Outlook Consolidated financial statements 17 Consolidated statement of income 17 Consolidated statement of comprehensive income 18 Consolidated statement of financial position 19 Consolidated statement of cash flows 20 Consolidated statement of changes in equity 22 Consolidated segment reporting first quarter of Notes 47 Financial Calendar This Quarterly Financial Report was published on May 6, 2015.

3 At a Glance Fresenius Share Management Report Financial Statements Notes 3 FRESENIUS GROUP FIGURES AT A GLANCE Fresenius is a global health care group providing products and services for dialysis, hospitals, and outpatient medical care. In addition, Fresenius focuses on hospital operations. We also manage projects and provide services for hospitals and other health care facilities. In 2014, Group sales were 23.2 billion. As of March 31, 2015, more than 217,000 employees have dedicated themselves to the service of health in about 100 countries worldwide. SALES, EARNINGS, AND CASH FLOW in millions Q1 / 2015 Q1 / 2014 Change Sales 6,483 5,212 24% EBIT % Net income % Earnings per share in % Operating cash flow BALANCE SHEET AND INVESTMENTS in millions March 31, 2014 December 31, 2014 Change Total assets 43,032 39,897 8% Non-current assets 32,344 29,869 8% Equity 3 17,271 15,483 12% Net debt 14,948 14,279 5% Investments ,158-67% RATIOS in millions Q1 / 2015 Q1 / 2014 EBITDA margin % 16.6% EBIT margin % 12.3% Depreciation and amortization in % of sales 4.1% 4.3% Operating cash flow in % of sales 8.2% 2.7% Equity ratio (March 31 / December 31) 40.1% 38.8% Net debt / EBITDA (March 31 / December 31) Before special items 2 Net income attributable to shareholders of Fresenius SE & Co. KGaA; before special items 3 Equity including noncontrolling interest 4 Investments in property, plant and equipment, and intangible assets, acquisitions (Q1) 5 Pro forma acquisitions; before special items, 3.12 at LTM average exchange rates for both net debt and EBITDA For a detailed overview of special items please see the reconciliation table on page 8.

4 At a Glance Fresenius Share Management Report Financial Statements Notes 4 INFORMATION BY BUSINESS SEGMENT FRESENIUS MEDICAL CARE Dialysis products, Dialysis services US$ in millions Q1 / 2015 Q1 / 2014 Change Sales 3,960 3,564 11% EBIT % Net income % Operating cash flow Investments / Acquisitions % R & D expenses % Employees, per capita on balance sheet date (March 31 / December 31) 107, ,917 2% FRESENIUS KABI IV drugs, Clinical nutrition, Infusion therapy, Medical devices / Transfusion technology in millions Q1 / 2015 Q1 / 2014 Change Sales 1,394 1,213 15% EBIT % Net income % Operating cash flow % Investments / Acquisitions % R & D expenses % Employees, per capita on balance sheet date (March 31 / December 31) 32,899 32,899 0% FRESENIUS HELIOS Hospital operations in millions Q1 / 2015 Q1 / 2014 Change Sales 1,391 1,227 13% EBIT % Net income % Operating cash flow % Investments / Acquisitions % Employees, per capita on balance sheet date (March 31 / December 31) 68,669 68,852 0% FRESENIUS VAMED Projects and services for hospitals and other health care facilities in millions Q1 / 2015 Q1 / 2014 Change Sales % EBIT % Net income % Operating cash flow % Investments / Acquisitions % Order intake % Employees, per capita on balance sheet date (March 31 / December 31) 7,819 7,746 1% 1 Net income attributable to shareholders of Fresenius Medical Care AG & Co. KGaA 2 Before special items 3 Net income attributable to shareholders of Fresenius Kabi AG; before special items 4 Net income attributable to shareholders of HELIOS Kliniken GmbH; before special items 5 Net income attributable to shareholders of VAMED AG For a detailed overview of special items please see the reconciliation table on page 8.

5 At a Glance Fresenius Share Management Report Financial Statements Notes 5 FRESENIUS SHARE The Fresenius share started the year strongly and reached a new all-time high of on March 16. The share price has risen 29% since the beginning of The European Central Bank s (ECB) bond buying program had an overall positive effect on European stock markets in the first quarter as did the accelerating economic recovery in the Euro zone. FIRST QUARTER OF 2015 Following the announcement of the bond purchase program by the ECB, stock prices in the Euro area increased significantly in the first quarter. At the same time, the Euro zone economy continued to recover and, according to current ECB estimates, will grow by 1.5% this year. Low oil prices and the weak Euro had a positive influence on the economic recovery of the Euro area. Growth of 2.3% to 2.7% is forecast by the US Federal Reserve (FED) for the US. The FED is not ruling out an interest rate increase, even though it is not expected before the end of the second quarter of In this economic environment, the DAX reached an all-time high of 12,168 on March 16. The Fresenius share also continued its long-term upward trend, reaching a record high of on March 16. The Fresenius share ended the first quarter of 2015 at 55.59, an increase of 29% compared with the 2014 closing price. At 11,966 points, the DAX increased 22% in the same period. RELATIVE SHARE PRICE PERFORMANCE VS. DAX = Fresenius share DAX KEY DATA OF THE FRESENIUS SHARE Q1 / Change Number of shares (March 31 / December 31) 542,815, ,532,600 Quarter-end quotation in % High in % Low in % Ø Trading volume (number of shares per trading day) 1,340,872 1,153,022 16% Market capitalization, in millions (March 31 / December 31) 30,175 23,373 29%

6 At a Glance Fresenius Share Management Report Financial Statements Notes 6 MANAGEMENT REPORT Fresenius had an excellent start into the year, even before taking into account very favorable exchange rate effects. All four business segments contributed to the strong financial results, with Fresenius Kabi s performance in particular standing out. Fresenius expects continued momentum in sales and profit growth in the coming quarters and raises its Group earnings guidance for STRONG START INTO THE YEAR DOUBLE-DIGIT GROWTH IN CONSTANT CURRENCY FRESENIUS RAISES GROUP EARNINGS GUIDANCE FOR 2015 at actual in constant Q 1 / 2015 rates currency Sales 6.5 bn + 24% + 13% EBIT bn + 32% + 18% Net income m + 28% + 16% HEALTH CARE INDUSTRY The health care sector is one of the world s largest industries. It is relatively insensitive to economic fluctuations compared to other sectors and has posted above-average growth over the past years. The main growth factors are rising medical needs deriving from aging populations, the growing number of chronically ill and multimorbid patients, stronger demand for innovative products and therapies, advances in medical technology and the growing health consciousness, which increases the demand for health care services and facilities. In the emerging countries, drivers are the expanding availability and correspondingly greater demand for basic health care and increasing national incomes and hence higher spending on health care. Health care structures are being reviewed and cost-cutting potential identified in order to contain the steadily rising health care expenditures. However, such measures cannot compensate for the cost pressure. Market-based elements are increasingly being introduced into the health care system to create incentives for cost- and quality-conscious behavior. Overall treatment costs shall be reduced through improved quality standards. In addition, ever-greater importance is being placed on disease prevention and innovative reimbursement models linked to treatment quality standards. RESULTS OF OPERATIONS, FINANCIAL POSITION, ASSETS AND LIABILITIES SALES Group sales in the first quarter increased by 24% (13% in constant currency) to 6,483 million (Q1 / 2014: 5,212 million). Organic sales growth was 6%. Acquisitions contributed 8%, while divestitures reduced sales by 1%. 1 Before special items 2 Net income attributable to shareholders of Fresenius SE & Co. KGaA; before special items For a detailed overview of special items please see the reconciliation table on page 8.

7 At a Glance Fresenius Share Management Report Financial Statements Notes 7 EARNINGS Group EBITDA 1 increased by 29% (15% in constant currency) to 1,115 million (Q1 / 2014: 867 million). Group EBIT 1 increased by 32% (18% in constant currency) to 851 million (Q1 / 2014: 643 million). The EBIT margin was 13.1% (Q1/ 2014: 12.3%). Group net interest increased to million (Q1/ 2014: million). Interest rate savings were more than offset by interest on incremental debt for acquisitions completed in 2014 and by currency translation effects. The Group tax rate 1 increased to 30.2% (Q1 / 2014: 26.3%). In the first quarter of 2014, a one-time item at Fresenius Medical Care had positively influenced the Group tax rate. Noncontrolling interest was 187 million (Q1 / 2014: 144 million), of which 95% was attributable to the noncontrolling interest in Fresenius Medical Care. EARNINGS in millions Q1 / 2015 Q1 / 2014 EBIT Net income Net income Earnings per share in Earnings per share in Group net income 2 before special items increased by 28% (16% in constant currency) to 292 million (Q1 / 2014: 228 million). Earnings per share 3 increased by 28% (16% in constant currency) to 0.54 (Q1 / 2014: 0.42). Group net income 2 including special items increased by 28% (17% in constant currency) to 317 million (Q1 / 2014: 248 million). Earnings per share 2 increased by 26% (17% in constant currency) to 0.58 (Q1 / 2014: 0.46). SALES BY REGION Currency trans lations effects Change at constant rates in millions Q1 / 2015 Q1 / 2014 Change at actual rates Organic growth Acquisitions / divestitures % of total sales North America 2,901 2,100 38% 24% 14% 6% 8% 45% Europe 2,559 2,358 9% 0% 9% 4% 5% 39% Asia-Pacific % 18% 23% 8% 15% 10% Latin America % 7% 25% 18% 7% 5% Africa % 4% 9% 9% 0% 1% Total 6,483 5,212 24% 11% 13% 6% 7% 100% SALES BY BUSINESS SEGMENT Currency trans lations effects Change at constant rates in millions Q1 / 2015 Q1 / 2014 Change at actual rates Organic growth Acquisitions / divestitures % of total sales 4 Fresenius Medical Care 3,516 2,602 35% 18% 17% 7% 10% 54% Fresenius Kabi 1,394 1,213 15% 10% 5% 5% 0% 21% Fresenius Helios 1,391 1,227 13% 0% 13% 4% 9% 22% Fresenius Vamed % 1% 8% 6% 2% 3% 1 Before special items 2 Net income attributable to shareholders of Fresenius SE & Co. KGaA 3 Net income attributable to shareholders of Fresenius SE & Co. KGaA; before special items 4 Calculated on the basis of contribution to consolidated sales For a detailed overview of special items please see the reconciliation table on page 8.

8 At a Glance Fresenius Share Management Report Financial Statements Notes 8 RECONCILIATION The Group s U.S. GAAP financial results as of March 31, 2015 and March 31, 2014 comprise special items. Net income attributable to shareholders of Fresenius SE & Co. KGaA was adjusted for these special items. The table below shows the special items and the reconciliation from net income (before special items) to earnings according to U.S. GAAP. INVESTMENTS Spending on property, plant and equipment was 273 million (Q1/ 2014: 234 million), primarily for the modernization and expansion of dialysis clinics, production facilities and hospitals. Total acquisition spending was 104 million (Q1/ 2014: 924 million). CASH FLOW Operating cash flow increased to 531 million (Q1/ 2014: 140 million). The cash flow margin increased to 8.2% (Q1 / 2014: 2.7%). Operating cash flow in the first quarter of 2014 was affected by the payment for the W.R. Grace bankruptcy settlement of US$ 115 million 1. Net capital expenditure increased to 273 million (Q1 / 2014: 243 million). Free cash flow before acquisitions and dividends improved to 258 million (Q1 / 2014: million). Free cash flow after acquisitions and dividends increased to 256 million (Q1 / 2014: - 1,006 million). RECONCILIATION Q1 / 2015 according to U.S. GAAP (incl. special items) Q1 / 2014 according to U.S. GAAP (incl. special items) in millions Q1 / 2015 (before special items) Efficiency program integration costs for acquired Rhön hospitals disposal gains from two HELIOS hospitals Q1 / 2014 (before special items) Fenwal integration costs disposal gains from two HELIOS hospitals Sales 6,483 6,483 5,212 5,212 EBIT Interest result Net income before taxes Income taxes Net income Less noncontrolling interest Net income attributable to shareholders of Fresenius SE & Co. KGaA INVESTMENTS BY BUSINESS SEGMENT thereof property, in millions Q1 / 2015 Q1 / 2014 plant and equipment thereof acquisitions Change % of total Fresenius Medical Care % 64% Fresenius Kabi % 24% Fresenius Helios % 13% Fresenius Vamed % 0% Corporate / Other % Total 377 1, % 100% 1 See Annual Report 2014, page 152 f.

9 At a Glance Fresenius Share Management Report Financial Statements Notes 9 ASSET AND LIABILITY STRUCTURE The Group s total assets increased by 8% (0% in constant currency) to 43,032 million (Dec. 31, 2014: 39,897 million). Current assets grew by 7% (0% in constant currency) to 10,688 million (Dec. 31, 2014: 10,028 million). Noncurrent assets increased by 8% (1% in constant currency) to 32,344 million (Dec. 31, 2014: 29,869 million). Total shareholders equity increased by 12% (3% in constant currency) to 17,271 million (Dec. 31, 2014: 15,483 million). The equity ratio increased to 40.1% (Dec. 31, 2014: 38.8%). Group debt grew by 3% (decreased by 3% in constant currency) to 15,940 million (Dec. 31, 2014: 15,454 million). As of March 31, 2015, the net debt / EBITDA ratio was (at LTM average exchange rates for both net debt and EBITDA: ). CASH FLOW STATEMENT (SUMMARY) in millions Q1 / 2015 Q1 / 2014 Change Net income % Depreciation and amortization % Change in accruals for pensions Cash flow % Change in working capital % Operating cash flow Property, plant and equipment % Proceeds from the sale of property, plant and equipment % Cash flow before acquisitions and dividends Cash used for acquisitions, net % Dividends paid % Free cash flow paid after acquisitions and dividends 256-1, % Cash provided by / used for financing activities % Effect of exchange rates on change in cash and cash equivalents Net change in cash and cash equivalents Pro forma acquisitions; before special items

10 At a Glance Fresenius Share Management Report Financial Statements Notes 10 BUSINESS SEGMENTS FRESENIUS MEDICAL CARE Fresenius Medical Care is the world's largest integrated provider of products and services for individuals undergoing dialysis because of chronic kidney failure. As of March 31, 2015, Fresenius Medical Care was treating 286,768 patients in 3,396 dialysis clinics. US$ in millions Q1 / 2015 Q1 / 2014 Change Sales 3,960 3,564 11% EBITDA % EBIT % Net income % Employees (March 31 / Dec. 31) 107, ,917 2% Excellent sales growth of 11% Strong cash flow margin of 11.3% 2015 outlook confirmed FIRST QUARTER OF 2015 Sales increased by 11% (17% in constant currency) to US$ 3,960 million (Q1/ 2014: US$ 3,564 million). Organic sales growth was 7%. Acquisitions contributed 10%. Adverse currency effects reduced sales by 6%. Health Care services sales (dialysis services and care coordination) increased by 14% (18% in constant currency) to US$ 3,182 million (Q1/ 2014: US$ 2,782 million). Dialysis product sales were US$ 778 million (Q1/ 2014: US$ 782 million), an increase by 11% in constant currency. In North America, sales increased by 16% to US$ 2,771 million (Q1 / 2014: US$ 2,393 million). Health Care services sales grew by 17% to US$ 2,571 million (Q1/ 2014: US$ 2,201 million). Dialysis product sales increased by 4% to US$ 200 million (Q1 / 2014: US$ 192 million). Sales outside North America grew by 2% (18% in constant currency) to US$ 1,180 million (Q1/ 2014: US$ 1,161 million). Health Care services sales increased by 5% (24% in constant currency) to US$ 611 million (Q1/ 2014: US$ 581 million). Dialysis product sales decreased by 2% (increased by 13% in constant currency) to US$ 569 million (Q1/ 2014: US$ 580 million). EBIT increased by 13% (21% in constant currency) to US$ 504 million (Q1/ 2014: US$ 445 million) due to improvements in the operating business across all regions. The EBIT margin increased to 12.7% (Q1 / 2014: 12.5%). Net income attributable to shareholders of Fresenius Medical Care AG & Co. KGaA increased by 2% (10% in constant currency) to US$ 210 million (Q1/ 2014: US$ 205 million). Operating cash flow increased to US$ 447 million (Q1/ 2014: US$ 112 million, affected by the payment for the W.R. Grace bankruptcy settlement of US$ 115 million 2 ). The cash flow margin increased to 11.3% (Q1/ 2014: 3.2%). Please see page 15 of the Management Report for the 2015 outlook of Fresenius Medical Care. For further information, please see Fresenius Medical Care s Investor News at 1 Net income attributable to shareholders of Fresenius Medical Care AG & Co. KGaA 2 See Annual Report 2014, page 152 f.

11 At a Glance Fresenius Share Management Report Financial Statements Notes 11 FRESENIUS KABI Fresenius Kabi offers infusion therapies, intravenously administered generic drugs and clinical nutrition for seriously and chronically ill patients in the hospital and outpatient environments. The company is also a leading supplier of medical devices and transfusion technology products. in millions Q1 / 2015 Q1 / 2014 Change Sales 1,394 1,213 15% EBITDA % EBIT % Net income % Employees (March 31 / Dec. 31) 32,899 32,899 0% 5% organic sales growth at the upper end of expected range 10% EBIT growth in constant currency 2015 outlook raised FIRST QUARTER OF 2015 Sales increased by 15% (5% in constant currency) to 1,394 million (Q1 / 2014: 1,213 million). Organic sales growth was 5%. Acquisitions contributed 1% while divestitures reduced sales by 1%. Positive currency translation effects (10%) were mainly related to the Euro s depreciation against the U.S. dollar and the Chinese yuan. Sales in Europe grew by 4% (organic growth: 5%) to 518 million (Q1/ 2014: 500 million). Sales in North America increased by 24% (organic growth: 3%) to 473 million (Q1/ 2014: 382 million). Sales growth was boosted by IV drug shortages easing more slowly than expected. Asia-Pacific sales increased by 20% (organic growth: 4%) to 268 million (Q1 / 2014: 222 million). Sales in Latin America / Africa grew by 24% (organic growth: 8%) to 135 million (Q1/ 2014: 109 million). EBIT 1 increased by 28% (10% in constant currency) to 257 million (Q1/ 2014: 201 million). The EBIT margin was 18.5% (Q1 / 2014: 16.6%). Net income 2 increased by 32% (14% in constant currency) to 140 million (Q1 / 2014: 106 million). Operating cash flow increased by 98% to 83 million (Q1/ 2014: 42 million) with a margin of 6.0% (Q1/ 2014: 3.5%). Fresenius Kabi s initiative to increase production efficiency and streamline administrative structures is well on track. Costs of 10 million before tax were incurred in the first quarter of These costs are reported in the Group segment Corporate / Other. Please see page 15 of the Management Report for the 2015 outlook of Fresenius Kabi. 1 Before special items 2 Net income attributable to shareholders of Fresenius Kabi AG; before special items For a detailed overview of special items please see the reconciliation table on page 8.

12 At a Glance Fresenius Share Management Report Financial Statements Notes 12 FRESENIUS HELIOS Fresenius Helios is Germany s largest hospital operator. HELIOS operates 111 hospitals, thereof 87 acute care clinics (including seven maximum care hospitals in Berlin-Buch, Duisburg, Erfurt, Krefeld, Schwerin, Wiesbaden and Wuppertal) and 24 post-acute care clinics. HELIOS treats approximately 4.5 million patients per year, thereof 1.2 million inpatients, and operates more than 34,000 beds. in millions Q1 / 2015 Q1 / 2014 Change Sales 1,391 1,227 13% EBITDA % EBIT % Net income % Employees (March 31 / Dec. 31) 68,669 68,852 0% 4% organic sales growth fully in line with expectations 200 bps EBIT margin increase in established hospital business 2015 outlook fully confirmed FIRST QUARTER OF 2015 Sales increased by 13% to 1,391 million (Q1 / 2014: 1,227 million). Organic sales growth was 4% (Q1 / 2014: 4%). Acquisitions contributed 10% while divestitures reduced sales by 1%. EBIT 1 grew by 29% to 147 million (Q1 / 2014: 114 million). The EBIT margin increased to 10.6% (Q1/ 2014: 9.3%). Net income 2 increased by 39% to 107 million (Q1/ 2014: 77 million). Sales of the established hospitals, including the former Rhön-Klinikum facilities consolidated for more than one year, grew by 4% to 1,263 million (Q1/ 2014: 1,214 million). EBIT 1 increased by 27% to 143 million (Q1 / 2014: 113 million). The EBIT margin of the established hospitals increased to 11.3% (Q1/ 2014: 9.3%). Sales of the acquired hospitals 3 consolidated for less than one year were 128 million. EBIT 1 was 4 million with a margin of 3.1%. The integration of the hospitals acquired from Rhön- Klinikum AG is fully on track. Total integration costs for 2014 and 2015 are confirmed at approximately 60 million. Integration costs were 2 million in Q1/2015 taking the total to date to 53 million. Amount and timing of projected nearterm cost synergies ( 85 million p.a.) are also confirmed. Please see page 15 of the Management Report for the 2015 outlook of Fresenius Helios. 1 Before special items 2 Net income attributable to shareholders of HELIOS Kliniken GmbH; before special items 3 Hospitals acquired from Rhön-Klinikum AG For a detailed overview of special items please see the reconciliation table on page 8.

13 At a Glance Fresenius Share Management Report Financial Statements Notes 13 FRESENIUS VAMED Fresenius Vamed manages projects and provides services for hospitals and other health care facilities worldwide. in millions Q1 / 2015 Q1 / 2014 Change Sales % EBITDA % EBIT % Net income % Employees (March 31 / Dec. 31) 7,819 7,746 1% Service business driving organic sales growth Excellent order intake of 192 million 2015 outlook confirmed FIRST QUARTER OF 2015 Sales increased by 9% (8% in constant currency) to 208 million (Q1 / 2014: 191 million). Organic sales growth was 6%. Acquisitions contributed 2%. Sales in the project business were unchanged at 80 million (Q1 / 2014: 80 million). Sales in the service business grew by 15% to 128 million (Q1/ 2014: 111 million). EBIT grew by 17% to 7 million (Q1 / 2014: 6 million) with a margin of 3.4% (Q1 / 2014: 3.1%). Net income 1 was unchanged at 4 million (Q1 / 2014: 4 million). Order intake increased by 67% to 192 million (Q1/ 2014: 115 million). As of March 31, 2015, order backlog reached a new all-time high of 1,510 million (Dec. 31, 2014: 1,398 million). Please see page 15 of the Management Report for the 2014 outlook of Fresenius Vamed. 1 Net income attributable to shareholders of Vamed AG

14 At a Glance Fresenius Share Management Report Financial Statements Notes 14 EMPLOYEES As of March 31, 2015, the number of employees increased by 1% to 217,836 (Dec. 31, 2014: 216,275). EMPLOYEES BY BUSINESS SEGMENT Number of employees March 31, 2015 Dec 31, 2014 Change Fresenius Medical Care 107, ,917 2% Fresenius Kabi 32,899 32,899 0% Fresenius Helios 68,669 68,852 0% Fresenius Vamed 7,819 7,746 1% Corporate / Other % Total 217, ,275 1% RESEARCH AND DEVELOPMENT Product and process development as well as the improvement of therapies are at the core of our growth strategy. Fresenius focuses its R & D efforts on its core competencies in the following areas: Dialysis Generic IV drugs Infusion and nutrition therapies Medical devices Apart from new products, we are concentrating on developing optimized or completely new therapies, treatment methods, and services. RESEARCH AND DEVELOPMENT EXPENSES BY BUSINESS SEGMENT in millions Q1 / 2015 Q1 / 2014 Change Fresenius Medical Care % Fresenius Kabi % Fresenius Helios -- Fresenius Vamed 0 0 Corporate / Other 1 0 Total % activities at Fresenius Medical Care aim to translate new insights into novel or improved developments and to bring them to market as quickly as possible, and thus make an important contribution towards rendering the treatment of patients increasingly comfortable, safe, and individualized. INFUSION THERAPIES, CLINICAL NUTRITION, GENERIC IV DRUGS, AND MEDICAL DEVICES Fresenius Kabi s research and development activities concentrate on products for the therapy and care of critically and chronically ill patients. Our focus is on areas with high medical needs, such as in the treatment of oncology patients. Our products help to support medical advancements in acute and post-acute care and improve the patients quality of life. We develop new products in areas such as clinical nutrition. In addition, we develop generic drug formulations ready to launch at the time of market formation as well as new formulations for non-patented drugs. Our medical devices significantly contribute to a safe and effective application of infusion solutions and clinical nutrition. In transfusion technology our R & D focus is on medical devices and disposables to support the secure, user-friendly, and efficient production of blood products. OPPORTUNITIES AND RISK REPORT Compared to the presentation in the 2014 annual report, there have been no material changes in Fresenius overall opportunities and risk situation in the first quarter of In the ordinary course of Fresenius Group s operations, the Fresenius Group is subject to litigation, arbitration and investigations relating to various aspects of its business. The Fresenius Group regularly analyzes current information about such claims for probable losses and provides accruals for such matters, including estimated expenses for legal services, as appropriate. In addition, we report on legal proceedings, currency and interest risks on pages 38 to 44 in the Notes of this report. DIALYSIS The complex interactions and side effects that lead to kidney failure are better explored today than ever before. Technological advances develop in parallel with medical insights to improve the possibilities for treating patients. Our R & D

15 At a Glance Fresenius Share Management Report Financial Statements Notes 15 SUBSEQUENT EVENTS There were no significant changes in the Fresenius Group's operating environment following the end of the first quarter of No other events of material importance on the assets and liabilities, financial position, and result of operations of the Group have occured after the close of the first quarter of RATING Fresenius is covered by the rating agencies Moody s, Standard & Poor s and Fitch. The following table shows the company rating of Fresenius SE & Co. KGaA: Standard & Poor s Moody s Fitch Company rating BBB - Ba1 BB + Outlook stable stable stable OUTLOOK 2015 FRESENIUS GROUP Based on the Group s excellent financial results in the first quarter of 2015 and positive prospects for the remainder of the year, Fresenius raises its 2015 earnings guidance. For 2015, Fresenius now expects net income 1 growth of 13% to 16% in constant currency. Previously, the company expected net income 1 growth of 9% to 12% in constant currency. The company fully confirms its Group sales guidance. Sales are expected to increase by 7% to 10% in constant currency. The net debt / EBITDA 2 ratio is expected to be approximately 3.0 at the end of FRESENIUS MEDICAL CARE Fresenius Medical Care confirms its outlook for The company expects sales to grow at 5% to 7%, which at constant currency is a growth rate of 10% to 12%. Net income attributable to shareholders of Fresenius Medical Care AG & Co. KGaA is expected to increase 0% to 5% in Savings from the global efficiency program are included, while potential acquisitions are not. The outlook reflects further operating cost investments within the Care Coordination segment. The outlook is based on exchange rates prevailing at the beginning of FRESENIUS KABI 3 Fresenius Kabi raises its outlook for 2015 and now expects organic sales growth of 4% to 7% and EBIT growth in constant currency in the range of 11% to 14%. The implied EBIT margin is 18.5% to 19.5%. Previously, Fresenius Kabi projected organic sales growth of 3% to 5% and an EBIT growth in constant currency in the range of 4% to 6% with an implied EBIT margin in the range of 17.5% to 18.5%. FRESENIUS HELIOS 4 Fresenius Helios fully confirms its outlook for Fresenius Helios projects organic sales growth of 3% to 5% and reported sales growth of 6% to 9%. EBIT is expected to increase to 630 to 650 million. FRESENIUS VAMED Fresenius Vamed confirms its outlook for 2015 and expects to achieve single-digit organic sales growth and EBIT growth of 5% to 10%. INVESTMENTS The Group plans to invest around 6% of sales in property, plant and equipment. EMPLOYEES The number of employees in the Group will continue to rise in the future as a result of the expected expansion. We expect the number of employees to be above 220,000 in 2015 (December 31, 2014: 216,275). The number of employees is expected to increase in all business segments. 1 Net income attributable to shareholders of Fresenius SE & Co. KGaA; 2015 before integration costs (~ 10 million before tax for hospitals acquired from Rhön-Klinikum AG), before costs for the efficiency program at Fresenius Kabi (~ 100 million before tax), and before the disposal gains from the divestment of two HELIOS hospitals ( 34 million before tax); 2014 before special items 2 At annual average exchange rates for both net debt and EBITDA; without major acquisitions; before special items 3 Fresenius Kabi s outlook excludes ~ 100 million costs before tax for the efficiency program 4 Fresenius Helios outlook excludes integration costs for the hospitals acquired from Rhön-Klinikum AG (~ 10 million before tax) and the disposal gains from the divestment of two HELIOS hospitals ( 34 million before tax)

16 At a Glance Fresenius Share Management Report Financial Statements Notes 16 RESEARCH AND DEVELOPMENT Our R & D activities will continue to play a key role in securing the Group s long-term growth through innovations and new therapies. We plan to increase the Group s R & D spending in About 4% to 5% of our product sales will be reinvested in research and development. Market-oriented research and development with strict time-to-market management processes is crucial for the success of new products. We continually review our R & D results using clearly defined milestones. Innovative ideas, product development, and therapies with a high level of quality will continue to be the basis for future market-leading positions. Given the continued cost-containment efforts in the health care sector, cost efficiency combined with a strong quality focus is acquiring ever-greater importance in product development, and in the improvement of treatment concepts. GROUP FINANCIAL OUTLOOK 2015 Previous guidance New guidance Sales, growth (constant currency) 7% 10% confirmed Net income 1, growth (in constant currency) 9% 12% 13% 16% 1 Net income attributable to shareholders of Fresenius SE & Co. KGaA; 2015 before integration costs (~ 10 million before tax for hospitals acquired from Rhön-Klinikum AG), before costs for the efficiency program at Fresenius Kabi (~ 100 million before tax), and before the disposal gains from the divestment of two HELIOS hospitals ( 34 million before tax); 2014 before special items OUTLOOK 2015 BY BUSINESS SEGMENT Previous guidance New guidance Fresenius Medical Care 1 Sales growth 5% 7% confirmed Net income 2 growth 0% 5% confirmed Fresenius Kabi 3 Sales growth (organic) 3% 5% 4% 7% EBIT growth (in constant currency) 4% 6% 11% 14% Fresenius Helios 4 Sales growth (organic) 3% 5% confirmed EBIT m confirmed Fresenius Vamed Sales growth (organic) Single-digit % confirmed EBIT, growth 5% 10% confirmed 1 Savings from the global efficiency program and further operating cost investments within the Care Coordination business are included, while potential acquisitions are not taken into account. The outlook is based on exchange rates prevailing at the beginning of Net income attributable to the shareholders of Fresenius Medical Care AG & Co. KGaA 3 Fresenius Kabi s outlook excludes ~ 100 million costs before tax for the efficiency program 4 Fresenius Helios outlook excludes integration costs for the hospitals acquired from Rhön-Klinikum AG (~ 10 million before tax) and disposal gains from the divestment of two HELIOS hospitals ( 34 million before tax)

17 At a Glance Fresenius Share Management Report Financial Statements Notes 17 FRESENIUS SE & CO. KGAA CONSOLIDATED STATEMENT OF INCOME (UNAUDITED) in millions Q1 / 2015 Q1 / 2014 Sales 6,483 5,212 Cost of sales - 4,557-3,694 Gross profit 1,926 1,518 Selling, general and administrative expenses Research and development expenses Operating income (EBIT) Net interest Income before income taxes Income taxes Net income Less noncontrolling interest Net income attributable to shareholders of Fresenius SE & Co. KGaA Earnings per ordinary share in (after stock split 1 : 3) Fully diluted earnings per ordinary share in (after stock split 1 : 3) The following notes are an integral part of the unaudited condensed interim financial statements. FRESENIUS SE & CO. KGAA CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (UNAUDITED) in millions Q1 / 2015 Q1 / 2014 Net income Other comprehensive income (loss) Foreign currency translation 1, Cash flow hedges Change of fair value of available for sale financial assets 14 Actuarial gains / losses on defined benefit pension plans Income taxes related to components of other comprehensive income (loss) Other comprehensive income (loss), net 1, Total comprehensive income 1, Comprehensive income attributable to noncontrolling interest subject to put provisions Comprehensive income attributable to noncontrolling interest not subject to put provisions Comprehensive income attributable to shareholders of Fresenius SE & Co. KGaA The following notes are an integral part of the unaudited condensed interim financial statements.

18 At a Glance Fresenius Share Management Report Financial Statements Notes 18 FRESENIUS SE & CO. KGAA CONSOLIDATED STATEMENT OF FINANCIAL POSITION (UNAUDITED) ASSETS in millions March 31, 2015 December 31, 2014 Cash and cash equivalents 992 1,175 Trade accounts receivable, less allowance for doubtful accounts 4,713 4,235 Accounts receivable from and loans to related parties Inventories 2,648 2,333 Other current assets 1,824 1,843 Deferred taxes I. Total current assets 10,688 10,028 Property, plant and equipment 7,133 6,776 Goodwill 21,693 19,868 Other intangible assets 1,594 1,446 Other non-current assets 1,564 1,458 Deferred taxes II. Total non-current assets 32,344 29,869 Total assets 43,032 39,897 LIABILITIES AND SHAREHOLDERS EQUITY in millions March 31, 2015 December 31, 2014 Trade accounts payable 1,136 1,052 Short-term accounts payable to related parties 4 5 Short-term accrued expenses and other short-term liabilities 4,499 4,164 Short-term debt Short-term loans from related parties 6 3 Current portion of long-term debt and capital lease obligations Current portion of Senior Notes Short-term accruals for income taxes Deferred taxes A. Total short-term liabilities 7,650 7,104 Long-term debt and capital lease obligations, less current portion 5,933 5,977 Senior Notes, less current portion 7,429 6,977 Convertible bonds Long-term accrued expenses and other long-term liabilities Pension liabilities 1,140 1,099 Long-term accruals for income taxes Deferred taxes 1, B. Total long-term liabilities 17,340 16,629 I. Total liabilities 24,990 23,733 II. Noncontrolling interest subject to put provisions A. Noncontrolling interest not subject to put provisions 6,984 6,148 Subscribed capital Capital reserve 3,048 3,018 Other reserves 6,211 5,894 Accumulated other comprehensive income (loss) B. Total Fresenius SE & Co. KGaA shareholders equity 10,287 9,335 III. Total shareholders equity 17,271 15,483 Total liabilities and shareholders equity 43,032 39,897 The following notes are an integral part of the unaudited condensed interim financial statements.

19 At a Glance Fresenius Share Management Report Financial Statements Notes 19 FRESENIUS SE & CO. KGAA CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED) in millions Q1 / 2015 Q1 / 2014 Operating activities Net income Adjustments to reconcile net income to cash and cash equivalents provided by operating activities Depreciation and amortization Gain on sale of investments and divestitures Change in deferred taxes Gain on sale of fixed assets Changes in assets and liabilities, net of amounts from businesses acquired or disposed of Trade accounts receivable, net Inventories Other current and non-current assets Accounts receivable from / payable to related parties 7 Trade accounts payable, accrued expenses and other short-term and long-term liabilities Accruals for income taxes 2 51 Net cash provided by operating activities Investing activities Purchase of property, plant and equipment Proceeds from sales of property, plant and equipment 6 3 Acquisitions and investments, net of cash acquired and net purchases of intangible assets Proceeds from sale of investments and divestitures Net cash used in investing activities ,118 Financing activities Proceeds from short-term loans Repayments of short-term loans Proceeds from short-term loans from related parties Repayments of short-term loans from related parties Proceeds from long-term debt and capital lease obligations 51 1,357 Repayments of long-term debt and capital lease obligations ,648 Proceeds from the issuance of Senior Notes 0 1,420 Proceeds from the issuance of convertible bonds Changes of accounts receivable securitization program Proceeds from the exercise of stock options Dividends paid Change in noncontrolling interest Exchange rate effect due to corporate financing - 2 Net cash provided by / used in financing activities Effect of exchange rate changes on cash and cash equivalents 76-5 Net decrease in cash and cash equivalents Cash and cash equivalents at the beginning of the reporting period 1, Cash and cash equivalents at the end of the reporting period The following notes are an integral part of the unaudited condensed interim financial statements.

20 At a Glance Fresenius Share Management Report Financial Statements Notes 20 FRESENIUS SE & CO. KGAA CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (UNAUDITED) Subscribed Capital Reserves Number of ordinary shares in thousand 1 Amount in thousands Amount in millions Capital reserve in millions Other reserves in millions As of December 31, , , ,955 5,052 Proceeds from the exercise of stock options Compensation expense related to stock options 6 Dividends paid Purchase of noncontrolling interest not subject to put provisions Change in fair value of noncontrolling interest subject to put provisions 3 Comprehensive income (loss) Net income 248 Other comprehensive income (loss) Cash flow hedges Change of fair value of available for sale financial assets Foreign currency translation Actuarial gains on defined benefit pension plans Comprehensive income (loss) 248 As of March 31, , , ,971 5,300 As of December 31, , , ,018 5,894 Proceeds from the exercise of stock options 1,283 1, Compensation expense related to stock options 5 Dividends paid Sale of noncontrolling interest not subject to put provisions Change in fair value of noncontrolling interest subject to put provisions - 3 Comprehensive income (loss) Net income 317 Other comprehensive income (loss) Cash flow hedges Change of fair value of available for sale financial assets Foreign currency translation Actuarial losses on defined benefit pension plans Comprehensive income 317 As of March 31, , , ,048 6,211 1 Prior year figures were adjusted due to the stock split in 2014.

21 At a Glance Fresenius Share Management Report Financial Statements Notes 21 FRESENIUS SE & CO. KGAA CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (UNAUDITED) Accumulated other comprehensive income (loss) in millions Total Fresenius SE & Co. KGaA shareholders equity in millions Non controlling interest not subject to put provisions in millions Total shareholders equity in millions As of December 31, ,195 5,065 13,260 Proceeds from the exercise of stock options Compensation expense related to stock options Dividends paid Purchase of noncontrolling interest not subject to put provisions Change in fair value of noncontrolling interest subject to put provisions Comprehensive income (loss) Net income Other comprehensive income (loss) Cash flow hedges Change of fair value of available for sale financial assets Foreign currency translation Actuarial gains on defined benefit pension plans Comprehensive income (loss) As of March 31, ,437 5,182 13,619 As of December 31, ,335 6,148 15,483 Proceeds from the exercise of stock options Compensation expense related to stock options Dividends paid Sale of noncontrolling interest not subject to put provisions Change in fair value of noncontrolling interest subject to put provisions Comprehensive income (loss) Net income Other comprehensive income (loss) Cash flow hedges Change of fair value of available for sale financial assets Foreign currency translation ,337 Actuarial losses on defined benefit pension plans Comprehensive income ,766 As of March 31, ,287 6,984 17,271 The following notes are an integral part of the unaudited condensed interim financial statements.

22 At a Glance Fresenius Share Management Report Financial Statements Notes 22 FRESENIUS SE & CO. KGAA CONSOLIDATED SEGMENT REPORTING FIRST QUARTER (UNAUDITED) Fresenius Medical Care Fresenius Kabi Fresenius Helios Fresenius Vamed Corporate / Other Fresenius Group by business segment, in millions Change Change Change Change Change Change Sales 3,516 2,602 35% 1,394 1,213 15% 1,391 1,227 13% % % 6,483 5,212 24% thereof contribution to consolidated sales 3,511 2,596 35% 1,382 1,205 15% 1,391 1,227 13% % 1 1 0% 6,483 5,212 24% thereof intercompany sales % % % % 0 0 contribution to consolidated sales 54% 50% 21% 23% 22% 23% 3% 4% 0% 0% 100% 100% EBITDA % % % % % 1, % Depreciation and amortization % % % 2 2 0% % % EBIT % % % % % % Net interest % % % % % Income taxes % % % % % Net income attributable to shareholders of Fresenius SE & Co. KGaA % % % 4 4 0% % % Operating cash flow % % % Cash flow before acquisitions and dividends % % % Total assets 1 23,336 20,960 11% 10,560 9,655 9% 8,369 8,352 0% % ,032 39,897 8% Debt 1 8,413 7,851 7% 5,601 5,205 8% 1,311 1,394-6% % % 15,940 15,454 3% Capital expenditure, gross % % % % % Acquisitions, gross / investments % % % % % Research and development expenses % % % Employees (per capita on balance sheet date) 1 107, ,917 2% 32,899 32,899 0% 68,669 68,852 0% 7,819 7,746 1% % 217, ,275 1% Key figures EBITDA margin 17.2% 17.2% 22.6% 20.9% 13.8% 12.9% 4.3% 4.2% 17.2% 2,4 16.6% 3,5 EBIT margin 12.7% 12.5% 18.5% 16.6% 10.6% 9.3% 3.4% 3.1% 13.1% 2,4 12.3% 3,5 Depreciation and amortization in % of sales 4.4% 4.7% 4.2% 4.3% 3.2% 3.6% 1.0% 1.0% 4.1% 4.3% Operating cash flow in % of sales 11.3% 3.2% 6.0% 3.5% 8.2% 6.3% % % 8.2% 2.7% ROOA 1 9.8% 9.7% 10.6% 10.5% 7.4% 7.4% 10.8% 11.2% 9.1% 8 9.1% : December 31 2 Before costs for the efficiency program 3 Before integration costs 4 Before integration costs and disposal gains (two HELIOS hospitals) 5 Before disposal gains (two HELIOS hospitals) 6 After costs for the efficiency program, integration costs and disposal gains (two HELIOS hospitals) 7 After integration costs and disposal gains (two HELIOS hospitals) 8 The underlying pro forma EBIT does not include costs for the efficiency program, integration costs and disposal gains (two HELIOS hospitals). 9 The underlying pro forma EBIT does not include integration costs and disposal gains (two HELIOS hospitals, Rhön stake). The consolidated segment reporting is an integral part of the notes. The following notes are an integral part of the unaudited condensed interim financial statements.

23 At a Glance Fresenius Share Management Report Financial Statements Notes 23 TABLE OF CONTENTS NOTES 24 General notes Principles 24 I. Group structure 24 II. Basis of presentation 24 III. Summary of significant accounting policies 24 IV. Recent pronouncements, applied 25 V. Recent pronouncements, not yet applied Acquisitions, divestitures and investments 27 Notes on the consolidated statement of income Special items Sales Taxes Earnings per share 28 Notes on the consolidated statement of financial position Cash and cash equivalents Trade accounts receivable Inventories Other current and non-current assets Goodwill and other intangible assets Debt and capital lease obligations Senior Notes Convertible bonds Pensions and similar obligations Noncontrolling interest Fresenius SE & Co. KGaA shareholders equity Other comprehensive income (loss) 38 Other notes Legal and regulatory matters Financial instruments Supplementary information on capital management Supplementary information on the consolidated statement of cash flows Notes on the consolidated segment reporting Stock options Related party transactions Subsequent events Corporate Governance

24 At a Glance Fresenius Share Management Report Financial Statements Notes 24 GENERAL NOTES 1. PRINCIPLES I. GROUP STRUCTURE Fresenius is a global health care group with products and services for dialysis, hospitals and outpatient medical care. In addition, the Fresenius Group focuses on hospi tal operations and also manages projects and provides services for hospitals and other health care facilities worldwide. Besides the activities of the parent company Fresenius SE & Co. KGaA, Bad Homburg v. d. H., the operating activities were split into the following legally independent business segments as of March 31, 2015: Fresenius Medical Care Fresenius Kabi Fresenius Helios Fresenius Vamed The reporting currency in the Fresenius Group is the euro. In order to make the presentation clearer, amounts are mostly shown in million euros. Amounts under 1 million after rounding are marked with. II. BASIS OF PRESENTATION The accompanying condensed consolidated financial statements have been prepared in accordance with the United States Generally Accepted Accounting Principles (U.S. GAAP). Fresenius SE & Co. KGaA, as a stock exchange listed company with a domicile in a member state of the European Union, fulfills its obligation to prepare and publish the consolidated financial statements in accordance with the International Financial Reporting Standards (IFRS) applying Section 315a of the German Commercial Code (HGB). Simultaneously, the Fresenius Group voluntarily prepares and publishes the consolidated financial statements in accordance with U.S. GAAP. The accounting policies underlying these interim financial statements are mainly the same as those applied in the consolidated financial statements as of December 31, III. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Principles of consolidation The condensed consolidated financial statements and management report for the first quarter ended March 31, 2015 have not been audited nor reviewed and should be read in conjunction with the notes included in the consolidated financial statements as of December 31, 2014, published in the 2014 Annual Report. Except for the reported acquisitions (see note 2, Acquisitions, divestitures and investments), there have been no other major changes in the entities consolidated. The consolidated financial statements for the first quarter ended March 31, 2015 include all adjustments that, in the opinion of the Management Board, are of a normal and recurring nature and are necessary to provide an appropriate view of the assets and liabilities, financial position and results of operations of the Fresenius Group. The results of operations for the first quarter ended March 31, 2015 are not necessarily indicative of the results of operations for the fiscal year Classifications Certain items in the consolidated financial statements for the first quarter of 2014 and for the year 2014 have been reclassified to conform with the current year s presentation. Use of estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of income and expenses during the reporting period. Actual results could differ from those estimates. IV. RECENT PRONOUNCEMENTS, APPLIED The Fresenius Group has prepared its consolidated financial statements at March 31, 2015 in conformity with U.S. GAAP in force for interim periods on January 1, The Fresenius Group applied the following standards, as far as they are relevant for Fresenius Group s business, for the first time: In June 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU ), FASB Accounting Standards Codification (ASC) Topic 860, Transfers and Servicing Repurchase-to-Maturity