SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13A-16 OR 15D-16 UNDER THE
SECURITIES EXCHANGE ACT OF 1934
For the month of October 2022
Commission file number: 001-32749
FRESENIUS MEDICAL CARE AG & Co. KGaA
(Translation of registrant’s name into English)
Else-Kröner Strasse 1
61346 Bad Homburg
Germany
(Address of principal executive offices)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
Form 20-F ☒ | Form 40-F ☐ |
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ____
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ____
Interim Report of Financial Condition and Results of Operations for the three and nine months ended September 30, 2022 and 2021
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FRESENIUS MEDICAL CARE AG & Co. KGaA
FINANCIAL INFORMATION
Management’s discussion and analysis
In this report, “FMC AG & Co. KGaA,” or the “Company,” “we,” “us” or “our” refers to Fresenius Medical Care AG & Co. KGaA or Fresenius Medical Care AG & Co. KGaA and its subsidiaries on a consolidated basis, as the context requires. You should read the following discussion and analysis of the results of operations of the Company and its subsidiaries in conjunction with our unaudited interim consolidated financial statements and related notes contained elsewhere in this report and our disclosures and discussions in our consolidated financial statements as of and for the year ended December 31, 2021 prepared in accordance with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB”), using the euro as our reporting currency, included in our Annual Report on Form 20-F for the year ended December 31, 2021 (our "2021 Form 20-F").
The term “North America Segment” refers to our North America operating segment, the term “EMEA Segment” refers to the Europe, Middle East and Africa operating segment, the term “Asia-Pacific Segment” refers to our Asia-Pacific operating segment, and the term “Latin America Segment” refers to our Latin America operating segment. The term "Corporate" includes certain headquarters’ overhead charges, including accounting and finance, centrally managed production, production asset management, quality and supply chain management, procurement related to production as well as research and development and our Global Medical Office function, which seek to optimize medical treatments and clinical processes within the Company. The abbreviations “THOUS” and “M” are used to denote the presentation of amounts in thousands and millions, respectively. The term “Constant Currency” or at “Constant Exchange Rates” means that we have translated local currency revenue, operating income, net income attributable to shareholders of FMC AG & Co. KGaA and other items for the current reporting period into euro using the prior year exchange rates to provide a comparable analysis without effect from exchange rate fluctuations on translation, as described below under “Financial condition and results of operations – II. Discussion of measures – Non-IFRS measures.”
Forward-looking statements
This report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). When used in this report, the words “outlook,” “expects,” “anticipates,” “intends,” “plans,” “believes,” “seeks,” “estimates” and similar expressions are generally intended to identify forward looking statements. Although we believe that the expectations reflected in such forward-looking statements are reasonable, forward-looking statements are inherently subject to risks and uncertainties, many of which cannot be predicted with accuracy and some of which might not even be anticipated, and future events and actual results, financial and otherwise, could differ materially from those set forth in or contemplated by the forward-looking statements contained elsewhere in this report. We have based these forward-looking statements on current estimates and assumptions made to the best of our knowledge. By their nature, such forward-looking statements involve risks, uncertainties, assumptions and other factors which could cause actual results, including our financial condition and profitability, to differ materially, positively or negatively, relative to the results expressly or implicitly described in or suggested by these statements. Moreover, forward-looking estimates or predictions derived from third parties’ studies or information may prove to be inaccurate. Consequently, we cannot give any assurance regarding the future accuracy of the opinions set forth in this report or the actual occurrence of the projected developments described herein. In addition, even if our future results meet the expectations expressed here, those results may not be indicative of our performance in future periods.
These risks, uncertainties, assumptions, and other factors, including associated costs, could cause actual results to differ from our projected results and include, among others, the following:
| ● | changes in governmental and commercial insurer reimbursement for our complete products and services portfolio, including the United States (“U.S.”) Medicare reimbursement system for dialysis and other health care services, including potentially significant changes to the Patient Protection and Affordable Care Act of 2010 (Pub.L. 111-148), as amended by the Health Care and Education Reconciliation Act (Pub.L. 111-152) (collectively, “ACA”) that could result from future efforts to revise or repeal the ACA, and changes by regulators to certain reimbursement models, such as the End-Stage Renal Disease (“ESRD”) Treatment Choices model and the Comprehensive Kidney Care Contracting model, which could significantly impact performance under these models in unanticipated ways; |
| ● | our ability to accurately interpret and comply with complex current and future government regulations applicable to our business including sanctions and export control laws and regulations, laws and regulations in relation to environmental, social and governance topics, the impact of health care, tax and trade law reforms, in particular the Organisation for Economic Co-operation and Development initiatives for the reallocation of taxation rights to market countries (Pillar one) and introduction of a global minimum tax (Pillar two) as well as potential U.S. tax reform, antitrust and competition laws in the countries and localities in which we operate, rules regarding the use of government relief funding received in connection with the on-going worldwide severe acute respiratory syndrome coronavirus 2 and the related Coronavirus disease (“COVID-19”) pandemic, other government regulation including, in the U.S., the Anti-Kickback Statute, the False Claims Act, the Stark Law, the Civil Monetary Penalty Law, the Health Insurance Portability and Accountability Act, the Health Information Technology for Economic and Clinical Health Act, the Foreign Corrupt Practices Act (“FCPA”) including our non-prosecution agreement with the U.S. |
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| Department of Justice (“DOJ”) and the cease and desist order of the U.S. Securities and Exchange Commission (“SEC”), as well as the Food, Drug and Cosmetic Act and, outside the U.S., inter alia, the European Union (“EU”) Medical Device Regulation, the EU General Data Protection Regulation, the two invoice policy, “Buy China” policy, volume-based procurement policies and the Tendering and Bidding Law in China and other related local legislation as well as other comparable regulatory regimes in many of the countries where we supply health care services and/or products; |
| ● | the influence of commercial insurers and integrated care organizations, including efforts by these organizations to manage costs by limiting health care benefits, narrowing their networks, reducing provider reimbursement and/or restricting options for patient funding of health insurance premiums, including potential efforts by commercial insurers to make dialysis reimbursement payments at a lower “out-of-network” rate as a result of the U.S. Supreme Court’s ruling in Marietta Memorial Hospital Employee Health Benefit Plan v. DaVita Inc., No. 20-1641 (Oct. Term 2021), decided June 21, 2022; |
| ● | the impact of the COVID-19 pandemic, including, without limitation, a significant increase in mortality of patients with chronic kidney diseases as well as an increase in persons experiencing renal failure, both of which may be attributable to COVID-19, as well as the impacts of the virus on our patients, caregivers, employees, suppliers, supply chain, business and operations, the uncertainties arising from the development of variants of COVID-19, consequences of an economic downturn resulting from the impacts of COVID-19 and evolving guidelines and requirements regarding vaccine mandates for our employees and the use of government provided COVID-19 related relief and any additional economic relief legislation that may be passed in the countries in which we operate; |
| ● | our ability to attract and retain skilled employees and personnel shortages which have increased in light of the COVID-19 pandemic and vaccine mandates for certain workers, and risks that personnel shortages and competition for labor, as well as legislative, union, or other labor-related activities or changes have and will continue to result in significant increases in our operating costs, decreases in productivity and partial suspension in operations and impact our ability to address additional treatments and growth recovery; |
| ● | the increase in raw material, energy, labor and other costs, including an impact from these cost increases on our cost savings initiatives and increases due to geopolitical conflicts in certain regions (for example, impacts related to the war in Ukraine (“Ukraine War”)) as well as the impact that inflation may have on a potential impairment of our goodwill, investments or other assets as noted above; |
| ● | the outcome of government and internal investigations as well as litigation; |
| ● | product liability risks and the risk of regulator recalls of our products; |
| ● | our ability to continue to grow our health care services and products businesses, including through acquisitions, and to implement our strategy targeting the entire renal care continuum, complementary assets and critical care solutions; |
| ● | the impact of currency and interest rate fluctuations, including the heightened risk of fluctuations as a result of geopolitical conflicts in certain regions (for example, impacts related to the Ukraine War), the impact of the current macroeconomic inflationary environment on interest rates and a related effect on our borrowing costs; |
| ● | potential impairment of our goodwill, investments or other assets due to decreases in the recoverable amount of those assets relative to their book value, particularly as a result of sovereign rating agency downgrades coupled with an economic downturn in various regions or as a result of geopolitical conflicts in certain regions (for example, the Ukraine War); |
| ● | our ability to protect our information technology systems and protected health information against cyber security attacks or prevent other data privacy or security breaches of our data or the data of our third parties as well as our ability to effectively capture efficiency goals and align with contractual and other requirements related to data offshoring activities; |
| ● | changes in our costs of purchasing and utilization patterns for pharmaceuticals and our other health care products and supplies, the inability to procure raw materials or disruptions in our supply chain; |
| ● | introduction of generic or new pharmaceuticals and medical devices that compete with our products or services or the development of pharmaceuticals that reduce the progression of chronic kidney disease; |
| ● | launch of new technology, advances in medical therapies, or new market entrants that compete with our businesses; |
| ● | potential increases in tariffs and trade barriers that could result from withdrawal by single or multiple countries from multilateral trade agreements or the imposition of sanctions, retaliatory tariffs and other countermeasures in the wake of trade disputes and geopolitical conflicts in certain regions (for example, the Ukraine War); |
| ● | collectability of our receivables, which depends primarily on the efficacy of our billing practices, the financial stability and liquidity of our governmental and commercial payors and payor strategies to delay or thwart the collection process; |
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| ● | our ability to secure contracts and achieve cost savings and desired clinical outcomes in various health care risk management programs in which we participate or intend to participate; |
| ● | the greater size, market power, experience and product offerings of certain competitors in certain geographic regions and business lines; |
| ● | the use of accounting estimates, judgments and accounting pronouncement interpretations in our consolidated financial statements; and |
| ● | our ability to implement the transformation of our company structure and to achieve projected cost savings within the proposed timeframe as part of the previously announced FME25 Program, as defined in “Financial condition and results of operations – I. Overview - Company Structure,” below. |
Important factors that could contribute to such differences are noted in “Supplemental information regarding our risk factors” and “Financial condition and results of operations – I. Overview” below, in note 3 d) and note 11 of the notes to the consolidated financial statements (unaudited) included in this report, in note 22 of the notes to the consolidated financial statements included in our 2021 Form 20-F, as well as under “Risk Factors,” “Business overview,” “Operating and financial review and prospects,” and elsewhere in that report. Further information regarding our efforts to address various environmental, social and governance issues can be found within our Non-financial Group Report available at www.freseniusmedicalcare.com/en/investors/investors-overview/. In referencing our Non-financial Group Report and furnishing this website address in this report, however, we do not intend to incorporate any content from our Non-financial Group Report or information on our website into this report, and any information in our Non-financial Group Report or on our website should not be considered to be part of this report, except as expressly set forth herein.
Our business is also subject to other risks and uncertainties that we describe from time to time in our public filings which can be accessed at the SEC website at www.sec.gov. Developments in any of these areas could cause our results to differ materially from the results that we or others have projected or may project.
The actual accounting policies, the judgments made in the selection and application of these policies, as well as the sensitivities of reported results to changes in accounting policies, assumptions and estimates, are additional factors to be considered along with our interim financial statements and the discussion under “Results of operations, financial position and net assets” below. For a discussion of our critical accounting policies, see note 2 of the notes to the consolidated financial statements included in our 2021 Form 20-F.
Rounding adjustments applied to individual numbers and percentages shown in this and other reports may result in these figures differing immaterially from their absolute values. Some figures (including percentages) in this report have been rounded in accordance with commercial rounding conventions. In some instances, such rounded figures and percentages may not add up to 100% or to the totals or subtotals contained in this report. Furthermore, totals and subtotals in tables may differ slightly from unrounded figures contained in this report due to rounding in accordance with commercial rounding conventions. A dash (“–”) indicates that no data were reported for a specific line item in the relevant financial year or period, while a zero (“0”) is used when the pertinent figure, after rounding, amounts to zero.
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Supplemental information regarding our risk factors
The current global economic climate, specifically as it relates to the Ukraine War, has enhanced the risks described in our 2021 Form 20-F, specifically under “Risk Factors,” and the supplemental information below should be read in conjunction with those risks.
As a provider of life-sustaining healthcare services for dialysis patients, we are continuing to provide dialysis services and to supply our clinics with dialysis products in both Russia and Ukraine to the best of our ability in spite of the current war in the region and notwithstanding extensive economic sanctions imposed on Russia by numerous governments in response to the war. In addition to risks related to the further development of our activities in the two countries, considerable uncertainties arise within this highly dynamic situation, in particular from a possible deterioration of the global macroeconomic outlook. While the direct and indirect impacts related to the Ukraine War are difficult to predict at the present time, the current, significant macroeconomic inflationary environment, including materially increasing energy prices, has resulted in and could continue to lead to, among other consequences, material increases in costs for energy, supplies and transportation. A continued disruption or discontinuation of energy supplies from Russia may increase these impacts and could have additional material adverse effects on our business such as a potential closure of certain of our production sites or significantly increased costs incurred due to a switch to alternative energy sources. Furthermore, we could be impacted by pressure on or material increases in interest rates, particularly if accompanied by more difficult access to capital in the financial markets and currency devaluations as a result of the geopolitical situation. Additionally, the Ukraine War has increased the risk of cyber security attacks against our systems and data. Overall, the aforementioned factors could have a material negative impact on our net assets, financial position and results of operations. While we still consider the Risk Factor “We could be adversely affected if we experience shortages of goods or material price increases from our suppliers, or an inability to access new and improved products and technology” to be a medium level risk in the short-term, we believe that the Ukraine War has increased both the likelihood and potential impact of the risks and exposures described in the 2021 20-F.
At the time of this report and unchanged from our assessment in the 2021 20-F, we have not identified any risks that could jeopardize our continued existence.
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Financial condition and results of operations
I. Overview
We are the world’s leading provider of products and services for individuals with renal diseases, based on publicly reported revenue and number of patients treated. We provide dialysis care and related services to persons who suffer from End-Stage Kidney Disease (“ESKD”) as well as other health care services. We also develop, manufacture and distribute a wide variety of health care products. Our health care products include hemodialysis machines, peritoneal dialysis cyclers, dialyzers, peritoneal dialysis solutions, hemodialysis concentrates, solutions and granulates, bloodlines, renal pharmaceuticals, systems for water treatment, and acute cardiopulmonary and apheresis products. We supply dialysis clinics we own, operate or manage with a broad range of products and also sell dialysis products to other dialysis service providers. We sell our health care products to customers in around 150 countries and we also use them in our own health care service operations. Our dialysis business is therefore vertically integrated. Our other health care services include value and risk-based care programs, pharmacy services, vascular, cardiovascular and endovascular specialty services as well as ambulatory surgery center services, physician nephrology and cardiology services and ambulant treatment services. We estimate that the size of the global dialysis market was approximately €79 billion in 2021. Dialysis patient growth results from factors such as the aging population and increased life expectancies; shortage of donor organs for kidney transplants; increasing incidence of kidney disease and better treatment of and survival of patients with diabetes, hypertension and other illnesses, which frequently lead to the onset of chronic kidney disease; improvements in treatment quality, new pharmaceuticals and product technologies, which prolong patient life; and improving standards of living in developing countries, which make life-saving dialysis treatment available. We are also engaged in different areas of health care product therapy research.
As a global company delivering health care services and products, we face the challenge of addressing the needs of a wide variety of stakeholders, such as patients, customers, payors, regulators and legislators in many different economic environments and health care systems. In general, government-funded programs (in some countries in coordination with private insurers) pay for certain health care items and services provided to their citizens. Not all health care systems provide payment for dialysis treatment. Therefore, the reimbursement systems and ancillary services utilization environment in various countries significantly influence our business.
On August 24, 2022, we completed a three-way business combination including Fresenius Health Partners, Inc. (“FHP”), the value-based care division of Fresenius Medical Care North America. The transaction, first announced in March 2022, received regulatory clearance and satisfied other customary closing conditions in the U.S. The new company, which will operate under the InterWell Health brand (“InterWell Health”), creates an innovative, stand-alone entity combining FHP's expertise in kidney care value-based contracting and performance, InterWell Health LLC's clinical care models and network of around 1,700 nephrologists and Cricket Health, Inc.'s tech-enabled care model that utilizes its proprietary informatics, StageSmart™ and patient engagement platforms and will target the management of care for more than 270,000 people with kidney disease with more than $11 billion (€11 billion as of the transaction date) in costs under management by 2025. For further information, see “II. Discussion of measures — Net leverage ratio (Non-IFRS Measure)” below and note 2 of the notes to the consolidated financial statements (unaudited) included in this report.
We have extended the service agreement of Franklin W. Maddux, MD, as Global Chief Medical Officer until December 31, 2027 (previously set to expire at the end of 2022). In connection with that extension, the supervisory board extended Mr. Maddux’s term limit as a Management Board member for the same period. The latter extension required an exception to our self-set age limit for Management Board members, which the supervisory board granted in recognition of Mr. Maddux’s extensive knowledge and the importance of the Global Medical Office in our new business model.
Significant U.S. reimbursement developments
The majority of health care services we provide are paid for by governmental institutions. For the nine months ended September 30, 2022, approximately 30% of our consolidated revenue was attributable to U.S. federally-funded health care benefit programs, such as Medicare and Medicaid reimbursement, under which reimbursement rates are set by the Centers for Medicare and Medicaid (“CMS”). Legislative changes could affect Medicare reimbursement rates for a significant portion of the services we provide. The stability of reimbursement in the U.S. has been affected by (i) the ESRD prospective payment system (“ESRD PPS”), (ii) the U.S. federal government across the board spending cuts in payments to Medicare providers commonly referred to as “U.S. Sequestration” (temporarily suspended from May 1, 2020 through March 31, 2022, after which time a 1% reduction became effective from April 1 to June 30, 2022 and the full 2% sequester resumed on July 1, 2022) and (iii) the reduction to the ESRD PPS rate to account for the decline in utilization of certain drugs and biologicals associated with dialysis pursuant to the American Taxpayer Relief Act of 2012 as subsequently modified under the Protecting Access to Medicare Act of 2014 (“PAMA”). Please see detailed discussions on these and further legislative developments below:
| ● | Under the Medicare Improvements for Patients and Providers Act of 2008 (“MIPPA”), for patients with Medicare coverage, all ESRD payments for dialysis treatments are made under the ESRD PPS, a single bundled payment rate which provides a fixed payment rate, to encompass substantially all goods and services provided during the dialysis treatment. MIPPA further created |
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| the ESRD Quality Incentive Program (“QIP”) which provides that dialysis facilities in the United States that fail to achieve annual quality standards established by CMS could have base payments reduced in a subsequent year by up to 2%. |
| ● | Additionally, as a result of the Budget Control Act of 2011 (“BCA”) and subsequent activity in Congress, U.S. Sequestration ($1.2 trillion in across-the-board spending cuts in discretionary programs) took effect on March 1, 2013 and is expected to continue through 2030. In particular, a 2% reduction to Medicare payments took effect on April 1, 2013 and continues in force. The 2% sequestration was temporarily suspended several times subsequent to May 1, 2020. In March 2021, President Biden signed the American Rescue Plan Act of 2021 (the “American Rescue Plan Act”) which the Congressional Budget Office has estimated will result in budget deficits that will require a 4% reduction in Medicare program payments for 2022 under the Statutory Pay-As-You-Go Act of 2010 (“Statutory PAYGO”) unless Congress and the President take action to waive the Statutory PAYGO reductions. In December 2021, Congress passed, and President Biden signed into law, the Protecting Medicare and American Farmers from Sequester Cuts Act impacting payments for all Medicare Fee-for-Service claims and extending the sequestration suspension through March 31, 2022 with a 1% reduction effective thereafter from April 1 to June 30, 2022 and a return to the full 2% sequester on July 1, 2022, as noted above. Spending cuts pursuant to U.S. Sequestration have adversely affected our operating results in the past and, with the suspension having been lifted, will continue to do so. |
| ● | On June 21, 2022, CMS issued a proposed rule for the ESRD PPS rate for calendar year (“CY”) 2023. The proposed base rate per treatment for CY 2023 is $264.09, which represents a 2.4% increase from the CY 2022 base rate of $257.90. The proposed increase of 2.4% is based on a proposed market basket increase of 2.8% partially offset by a proposed 0.4% multifactor productivity adjustment that is mandated by the ACA. CMS is proposing to update the outlier methodology to account for historical trends in spending as well as to better account for the introduction of new and innovative products under the transitional add-on payment adjustment for new and innovative equipment and supplies (“TPNIES”) and ESRD PPS transitional drug add-on payment adjustment (“TDAPA”) policies. CMS estimates that, on average, large dialysis organizations would receive a 3.0% increase in payments in CY 2023 compared to CY 2022 under this proposed rule. The Acute Kidney Injury payment rate for CY 2023 is to equal the CY 2023 ESRD PPS base rate. CMS reviewed three TPNIES applications for CY 2023. CMS estimates total TPNIES payment amounts to facilities in CY 2023 would be approximately $2.5 M. For CY 2023, the proposed pre-adjusted per-treatment amount will be reduced by an average per-treatment offset amount of $9.73. |
| ● | Under the ESRD QIP, CMS assesses the total performance of each facility on a set of measures specified per payment year (“PY”) and applies up to a 2 percent payment reduction to facilities that do not meet a minimum total performance score (“TPS”). In the CY 2023 proposed rule, CMS proposed to adopt a special scoring and payment policy for PY 2023 of the ESRD QIP to address the issues in the scoring system caused by the impact of the COVID-19 Public Health Emergency on QIP data, including the use of pre-pandemic data from CY 2019 as the baseline period for the PY 2023 ESRD QIP and for subsequent years and proposes a pause on certain measures for scoring and payment adjustment purposes. CMS is also seeking input on potentially adding quality measures for home dialysis, expanding reporting programs to better understand healthcare disparities and including two social drivers of health screening measures. Additionally, CMS proposes to express clinical measure results as rates beginning with PY 2024 ESRD QIP. |
| ● | On July 15, 2022, CMS announced the CY 2023 proposed rule for hospital outpatient and ambulatory surgery center (“ASC”) payment systems. The proposed rule to update the ASC payment system for CY 2023 generally increases the reimbursement rates for the range of procedures provided in an ASC. The proposed average increase is 2.7% compared to the prior year. CMS proposed to expand the categories of service subject to the prior authorization process within the ASC. For CY 2023, CMS proposed a new ASC payment policy resulting in higher payments when a code combination is more complex and represents a higher cost version of the performed procedures. On July 7, 2022, CMS also updated the proposed Physician Fee Schedule for CY 2023. The proposed CY 2023 Physician Fee Schedule conversion factor is $33.08, a decrease of $1.53 from the CY 2022 physician fee schedule conversion factor of $34.61. |
| ● | On May 9th, 2022, CMS issued a final rule in which the rules for calculating the accrual of maximum out-of-pocket costs (“MOOP”) were changed. Specifically, CMS specified that, beginning on June 28th, 2022, the MOOP limit in Medicare Advantage, also known as Medicare Part C, plans offered by private health insurers approved by CMS to provide their members with Medicare Part A, Part B and usually Part D benefits (“Medicare Advantage” plans) (after which the plan pays 100 percent of Medicare Advantage costs for Part A and Part B services) must be calculated based on the accrual of all cost-sharing in the plan benefit, regardless of whether that cost-sharing is paid by the beneficiary, Medicaid, other secondary insurance, or remains unpaid (including cost-sharing that remains unpaid because of State limits on the amounts paid for Medicare cost-sharing and dually eligible individuals’ exemption from Medicare cost-sharing). CMS believes the change will result in more equitable payment for Medicare Advantage providers, including dialysis providers, serving dually eligible beneficiaries. |
Presently, there is considerable uncertainty regarding possible future changes in health care regulation, including the regulation of reimbursement for dialysis services. As a consequence of the pressure to decrease health care costs, government reimbursement rate increases in the U.S. have historically been limited and are expected to continue in this fashion. However, any significant decreases in Medicare or commercial reimbursement rates, including under Medicare Advantage plans, or patient access to commercial insurance
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plans, including Medicare Advantage, could have material adverse effects on our health care services business and, because the demand for dialysis products is affected by Medicare reimbursement, on our products business. To the extent that increases in operating costs that are affected by inflation, such as labor and supply costs, are not fully reflected in a compensating increase in reimbursement rates, our business and results of operations would be adversely affected. Additionally, in Marietta Memorial Hospital Employee Health Benefit Plan v. DaVita Inc., the Supreme Court ruled against DaVita, Inc. in favor of a self-funded employer-sponsored health plan that provided only out-of-network dialysis reimbursements to individuals with ESKD. While the Medicare Secondary Payer statute has long been interpreted as requiring private plans to provide for a 30-month coordination period for individuals diagnosed with ESKD (with Medicare serving as the secondary payer), the decision creates the potential that other plans may follow suit in limiting the dialysis benefits offered. While we do not expect this to significantly impact plans for 2023, absent legislative action, the ruling could have implications in 2024 and beyond. In July and August 2022, the Restore Protections for Dialysis Patients Act (H.R. 8594/S.4750) was introduced in both the House and Senate. If passed, it would restore the Medicare Secondary Payer Act’s original intent requiring the 30-month coordination period be available to individuals diagnosed with ESKD. For additional information regarding these regulatory matters, see “Information on the Company—Regulatory and Legal Matters—Health Care Reform” in our 2021 Form 20-F.
For additional information, see “Risk Factors” included in our 2021 Form 20-F.
Premium assistance programs
The operation of charitable assistance programs such as that offered by the American Kidney Fund is receiving increased attention by CMS and state insurance regulators and legislators. The result may be a regulatory framework that differs from the current framework or that varies from state to state. Even in the absence of actions by CMS or state regulators and legislatures to restrict the access that patients currently have to premium assistance programs, insurers are likely to continue efforts to thwart charitable premium assistance by premium assistance programs to our patients. If successful in a material area or scope of our U.S. operations, these efforts would have a material adverse impact on our business and operating results.
Participation in new Medicare payment arrangements
Under CMS’s Comprehensive ESRD Care Model (the “Model”), dialysis providers and physicians formed entities known as ESRD Seamless Care Organizations (“ESCOs”) as part of a payment and care delivery pilot program that ended March 31, 2021 which sought to deliver better health outcomes for Medicare ESKD patients while lowering CMS’s costs. Following our initial participation in six ESCOs, we ultimately expanded our participation in the Model to 23 ESCOs formed at our dialysis facilities. ESCOs that achieved the program’s minimum quality thresholds and generated reductions in CMS’s cost of care above certain thresholds for the ESKD patients covered by the ESCO received a share of the cost savings, adjusted based on the ESCO’s performance on certain quality metrics. ESCOs may also owe payments to CMS if actual costs of care rise above set thresholds. As of March 2021, approximately 34,800 patients were aligned to ESCOs in which we participated.
In November 2017, we announced the results from the first performance year from our ESCOs. The results, which cover the period from October 2015 through December 2016, show improved health outcomes for patients receiving coordinated care through the ESCOs. This success was validated by an independent report, which showed a nearly 9% decrease in hospitalization rates for these patients during the same time. In the second performance year (CY 2017) the Company’s ESCOs together generated more than $66.7 M (€59.0 M) in gross savings, an average 3.4% reduction in expenditures per patient. For the third performance year (CY 2018), CMS published the final settlement reports on August 14, 2020. In total the Company’s ESCOs produced more than $66.1 M (€56.0 M) in gross savings, an average 1.9% reduction in expenditures per patient. For the fourth performance year (CY 2019), CMS published the final settlement reports on October 31, 2020. In total, the Company’s ESCOs produced more than $10.8 M (€9.6 M) in gross losses, an average 0.3% increase in expenditures per patient. For the fifth performance year (CY 2020), CMS gave each ESCO the options to (a) extend participation in the program through March 31, 2021, and/or to (b) accept the following financial changes: (i) reduce 2020 downside risk by reducing shared losses by proportion of months during the COVID-19 Public Health Emergency as promulgated under the Public Health Services Act, (ii) cap gross savings upside potential at 5% gross savings, (iii) remove COVID-19 inpatient episodes, and (iv) remove the 2020 financial guarantee requirement. All of our affiliated ESCOs signed amendments to extend participation in the program through March 31, 2021 and 22 of our ESCOs accepted the financial changes related to COVID-19. The Model ended on March 31, 2021. We anticipate that CMS will publish final settlement reports for the last performance year during the fourth quarter of 2022.
We have also entered into value and risk-based care programs with private payors to provide care to commercial and Medicare Advantage ESKD and CKD patients. Under these payment arrangements, our financial performance is based on our ability to manage a defined scope of medical costs within certain parameters for clinical outcomes.
Executive order-based models
On July 10, 2019, an Executive Order on advancing kidney health was signed in the United States. Among other things, the order instructed the Secretary of the U.S. Department of Health and Human Services (“HHS”) to develop new Medicare payment models to encourage identification and earlier treatment of kidney disease as well as increased home dialysis and transplants. One of those models, for which the rule was finalized on September 29, 2020 and later amended through finalized changes on October 29, 2021, the ESRD
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Treatment Choices (“ETC”) model, is a mandatory model that creates financial incentives for home treatment and kidney transplants with a start date in January 2021 and ending in June 2027. This model applies both upside and downside payment adjustments to claims submitted by physicians and dialysis facilities for certain Medicare home dialysis patients over the span of six and one-half years. Participants in this model are based on a random selection of 30% of the Hospital Referral Regions. As of September 30, 2022, 986 of our U.S. dialysis facilities, representing approximately 35% of our U.S. dialysis facilities, are within the random selection of Hospital Referral Regions and therefore are in areas selected for participation in the model. An initial upside-only payment, Home Dialysis Payment Adjustment (“HDPA”), will be applied for the first three years of the model, beginning in January 2021, in decreasing payment adjustments ranging from 3% in the first HDPA payment year, to 2% in the second HDPA payment year, and to 1% in the final HDPA payment year. This model also includes a Performance Payment Adjustment (“PPA”) beginning in July 2022. PPA payments will be a combined calculation of home dialysis (home, self-dialysis and nocturnal in-center) and transplant (living donor transplants and transplant waitlist) rates based upon a participant’s historic performance and/or increasingly weighted benchmark data from comparison geographic areas. CMS utilizes a two-tiered approach in PPA scoring to stratify participants with a high volume of beneficiaries who are dual-eligible for Medicare and Medicaid or Low Income Subsidy recipients. Possible PPA payment adjustments increase over time and will range from (5%) to 4% in the first PPA payment year (beginning July 2022) for both physicians and facilities and increase to (9%) and 8% for physicians and (10%) and 8% for facilities in the final PPA payment year (ending in June 2027).
On June 28, 2022, CMS proposed refinements to the ETC model, including a change to the requirements related to flexibilities regarding furnishing and billing kidney disease patient education services under the ETC model. CMS has also discussed its intent to publish participant-level performance data.
Pursuant to the Executive Order, the Secretary of HHS also announced voluntary payment models, Kidney Care First (“KCF”) and Comprehensive Kidney Care Contracting (“CKCC”) model (graduated, professional and global), which aim to build on the existing Comprehensive ESRD Care model. The voluntary models create financial incentives for health care providers to manage care for Medicare beneficiaries with chronic kidney disease stages 4 and 5 and with ESKD, to delay the start of dialysis, and to incentivize kidney transplants. The voluntary models allow health care providers to take on various amounts of financial risk by forming an entity known as a Kidney Care Entity (“KCE”). Two options, the CKCC global and professional models, allow renal health care providers to assume upside and downside financial risk. A third option, the CKCC graduated model, is limited to assumption of upside risk, but is unavailable to KCEs that include large dialysis organizations. Under the global model, the KCE is responsible for 100 percent of the total cost of care for all Medicare Part A and B services for aligned beneficiaries, and under the professional model, the KCE is responsible for 50 percent of such costs. Applications for the voluntary models were submitted in January 2020. We submitted 25 CKCC applications to participate in the professional model and were also included in four other CKCC applications submitted by nephrologists. All 29 of these KCE applications were accepted in June 2020. Of the 29 accepted applications, 28 KCEs have elected to participate in the implementation period, which started on October 15, 2020, and provided a start-up period during which the KCE is not at financial risk. The KCEs started assuming financial risk at the start of the first performance year on January 1, 2022. Of the 28 KCEs participating in the implementation period, we moved forward with 20 of the KCEs during the first performance year. Once implemented, the CKCC model is expected to run through 2026.
For the second performance year in the CKCC model, we submitted 4 additional CKCC applications (3 under the professional option and 1 under the global option) and were also included in one other CKCC application submitted by nephrologists under the global option. All 5 applications were accepted, though we notified CMS that we will not move forward with one of those applications. CMS will require these newly accepted KCEs to decide in the fourth quarter of 2022 whether they will move forward during the second performance year to start assuming financial risk as of January 1, 2023.
We are presently unable to predict the effects on our business of the ETC payment model and the voluntary payment models.
8
FRESENIUS MEDICAL CARE AG & Co. KGaA
Company structure
Our operating and reportable segments are the North America Segment, the EMEA Segment, the Asia-Pacific Segment and the Latin America Segment. The operating segments are determined based upon how we manage our businesses with geographical responsibilities. All segments are primarily engaged in providing health care services and the distribution of products and equipment for the treatment of ESKD and other extracorporeal therapies. Management evaluates each segment using measures that reflect all of the segment’s controllable revenues and expenses. With respect to the performance of business operations, management believes that the most appropriate measures are revenue and operating income. We do not include income taxes as we believe taxes are outside the segments’ control. Financing is a corporate function which our segments do not control. Therefore, we do not include interest expense relating to financing as a segment measurement. Similarly, we do not allocate certain costs which relate primarily to certain headquarters’ overhead charges, including accounting and finance as well as certain legal and IT costs, because we believe that these costs are also not within the control of the individual segments. Production of products, production asset management, quality and supply chain management as well as procurement related to production are centrally managed. Products transferred to the segments are transferred at cost; therefore, no internal profit is generated. The associated internal revenue for the product transfers and their elimination are recorded as corporate activities. Capital expenditures for production are based on the expected demand of the segments and consolidated profitability considerations. Our global research and development team as well as our Global Medical Office, which seek to optimize medical treatments and clinical processes within the Company, are also centrally managed. These corporate activities do not fulfill the definition of a segment according to IFRS 8, Operating Segments. In addition, certain revenues, investments and intangible assets, as well as any related expenses, are not allocated to a segment but accounted for as Corporate. Accordingly, all of these items are excluded from our analysis of segment results and are discussed below in the discussion of our consolidated results of operations. See note 13 of the notes to the consolidated financial statements (unaudited) found elsewhere in this report for a further discussion on our operating segments.
As announced on November 2, 2021, we entered the next phase of our program focusing on the transformation of our global operating model to strengthen profitability and enable execution on our mid-term strategy (“FME25 Program”): the transformation of our operating model to provide the base for future sustainable growth in the medium-term. In the new operating model, the Company intends to reorganize its business into two global operating segments.
We are consolidating our health care products business, including research and development, manufacturing, supply chain and commercial operations, as well as supporting functions, such as regulatory and quality management, under a global umbrella. The products business will be organized along the three treatment modalities that we serve: In-center, Home and Critical Care. Our global health care services business will be combined into one segment.
Our Global Medical Office will continue to leverage the vertically integrated approach to optimize clinical outcomes for our patients. General and administrative functions will also be globalized using a three pillars model of business partnering, centers of excellence and global shared services.
We expect to complete the implementation of the new model around 2023.
9
FRESENIUS MEDICAL CARE AG & Co. KGaA
II. Discussion of measures
Non-IFRS measures
Certain of the following key performance indicators and other financial information as well as discussions and analyses set out in this report include measures that are not defined by IFRS (“Non-IFRS Measure”). We believe this information, along with comparable IFRS financial measurements, is useful to our investors as it provides a basis for assessing our performance, payment obligations related to performance-based compensation, our compliance with covenants and enhanced transparency as well as comparability of our results. Non-IFRS financial measures should not be viewed or interpreted as a substitute for financial information presented in accordance with IFRS.
Constant Exchange Rates or Constant Currency (Non-IFRS Measure)
Our presentation of some key performance indicators and other financial measures used in this report such as changes in revenue, operating income and net income attributable to shareholders of FMC AG & Co. KGaA (or “net income”) includes the impact of translating local currencies to our reporting currency for financial reporting purposes. We calculate these Non-IFRS financial measures at constant exchange rates in our publications to show changes in our revenue, operating income, net income attributable to shareholders of FMC AG & Co. KGaA and other items without giving effect to period-to-period currency fluctuations. Under IFRS, amounts received in local (non-euro) currency are translated into euro at the average exchange rate for the period presented. Once we translate the local currency for the constant currency, we then calculate the change, as a percentage, of the current period calculated using the prior period exchange rates versus the prior period. This resulting percentage is a Non-IFRS Measure referring to a change as a percentage at constant currency. These currency-adjusted financial measures are identifiable by the designated terms “Constant Exchange Rates” or “Constant Currency.”
We believe that the measures at Constant Currency are useful to investors, lenders and other creditors because such information enables them to gauge the impact of currency fluctuations on our revenue, operating income, net income attributable to shareholders of FMC AG & Co. KGaA and other items from period to period. In addition, under our long-term incentive plans, we measure the attainment of certain predetermined financial targets for revenue growth and net income growth in Constant Currency. However, we limit our use of Constant Currency period-over-period changes to a measure for the impact of currency fluctuations on the translation of local currency into euro. We do not evaluate our results and performance without considering both:
| (1) | period-over-period changes in revenue, operating income, net income attributable to shareholders of FMC AG & Co. KGaA and other items prepared in accordance with IFRS, and |
| (2) | Constant Currency changes in revenue, operating income, net income attributable to shareholders of FMC AG & Co. KGaA and other items. |
We caution the readers of this report not to consider these measures in isolation, but to review them in conjunction with changes in revenue, operating income, net income attributable to shareholders of FMC AG & Co. KGaA and other items prepared in accordance with IFRS. We present the growth rate derived from non-IFRS measures next to the growth rate derived from IFRS measures such as revenue, operating income, net income attributable to shareholders of FMC AG & Co. KGaA and other items. As the reconciliation is inherent in the disclosure included within "Results of operations, financial position and net assets,” below, we believe that a separate reconciliation would not provide any additional benefit.
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FRESENIUS MEDICAL CARE AG & Co. KGaA
Return on invested capital (“ROIC”) (Non-IFRS Measure)
ROIC is the ratio of operating income, for the last twelve months, after tax (“net operating profit after tax” or “NOPAT”) to the average invested capital of the last five quarter closing dates, including adjustments for acquisitions and divestitures made during the last twelve months with a purchase price above a €50 M threshold, consistent with the respective adjustments made in the determination of adjusted EBITDA below (see “Net leverage ratio (Non-IFRS Measure)”). ROIC expresses how efficiently we allocate the capital under our control or how well we employ our capital with regard to investment projects. The following tables show the reconciliation of average invested capital to total assets, which we believe to be the most directly comparable IFRS financial measure, and how ROIC is calculated:
Reconciliation of average invested capital and ROIC (Non-IFRS Measure, unadjusted)
in € M, except where otherwise specified
Adjustments to average invested capital and ROIC
in € M, except where otherwise specified
11
Reconciliation of average invested capital and ROIC (Non-IFRS Measure)
in € M, except where otherwise specified
| September 30, | June 30, | March 31, | December 31, |
| September 30, | ||||
2022 |
| 2022 | 2022(3) |
| 2022(3) |
| 2021(3) |
| 2021(3) | |
Total assets |
| 38,406 | 36,669 | 35,285 | 34,916 |
| 34,483 | |||
Plus: Cumulative goodwill amortization and impairment loss |
| 699 | 665 | 641 | 612 |
| 604 | |||
Minus: Cash and cash equivalents |
| (1,114) | (1,080) | (1,225) | (1,533) |
| (1,612) | |||
Minus: Loans to related parties |
| (3) | (1) | (4) | (15) |
| (4) | |||
Minus: Deferred tax assets |
| (328) | (310) | (299) | (315) |
| (374) | |||
Minus: Accounts payable to unrelated parties |
| (828) | (846) | (798) | (744) |
| (714) | |||
Minus: Accounts payable to related parties |
| (81) | (102) | (70) | (121) |
| (94) | |||
Minus: Provisions and other current liabilities (1) |
| (3,488) | (3,226) | (3,192) | (3,322) |
| (3,519) | |||
Minus: Income tax liabilities |
| (242) | (207) | (194) | (174) |
| (224) | |||
Invested capital |
| 33,021 | 31,562 | 30,144 | 29,304 |
| 28,546 | |||
Average invested capital as of September 30, 2022 |
| 30,514 |
| |||||||
Operating income (3) |
| 1,578 |
|
| ||||||
Income tax expense (2), (3) |
| (486) |
|
| ||||||
NOPAT |
| 1,092 |
|
| ||||||
ROIC |
| 3.6% |
|
Reconciliation of average invested capital and ROIC (Non-IFRS Measure, unadjusted)
in € M, except where otherwise specified
Adjustments to average invested capital and ROIC
in € M, except where otherwise specified
12
Reconciliation of average invested capital and ROIC (Non-IFRS Measure)
in € M, except where otherwise specified
| December 31, |
| September 30, |
| June 30, |
| March 31, |
| December 31, | |
2021 |
| 2021 |
| 2021 (3) |
| 2021 (3) |
| 2021 (3) |
| 2020 (3) |
Total assets |
| 34,367 |
| 33,946 |
| 33,173 |
| 33,348 |
| 31,980 |
Plus: Cumulative goodwill amortization and impairment loss |
| 612 |
| 604 |
| 602 |
| 598 |
| 583 |
Minus: Cash and cash equivalents |
| (1,482) |
| (1,562) |
| (1,408) |
| (1,073) |
| (1,085) |
Minus: Loans to related parties |
| (15) |
| (4) |
| (6) |
| (1) |
| (1) |
Minus: Deferred tax assets |
| (315) |
| (374) |
| (359) |
| (333) |
| (351) |
Minus: Accounts payable to unrelated parties |
| (736) |
| (706) |
| (685) |
| (635) |
| (732) |
Minus: Accounts payable to related parties |
| (121) |
| (94) |
| (102) |
| (105) |
| (95) |
Minus: Provisions and other current liabilities (1) |
| (3,319) |
| (3,516) |
| (3,528) |
| (3,436) |
| (3,186) |
Minus: Income tax liabilities |
| (174) |
| (224) |
| (218) |
| (232) |
| (197) |
Invested capital |
| 28,817 |
| 28,070 |
| 27,469 |
| 28,131 |
| 26,916 |
Average invested capital as of December 31, 2021 |
| 27,879 |
|
|
|
|
|
|
| |
Operating income (3) |
| 1,864 |
|
|
|
|
|
|
|
|
Income tax expense (2), (3) |
| (493) |
|
|
|
|
|
|
|
|
NOPAT |
| 1,371 |
|
|
|
|
|
|
|
|
ROIC |
| 4.9% |
|
|
|
|
|
|
|
| (1) | Including non-current provisions, non-current labor expenses and variable payments outstanding for acquisitions and excluding pension liabilities and noncontrolling interests subject to put provisions. |
| (2) | Adjusted for noncontrolling partnership interests. |
| (3) | Including adjustments for acquisitions and divestitures made during the last twelve months with a purchase price above a €50 M threshold. |
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FRESENIUS MEDICAL CARE AG & Co. KGaA
Net cash provided by (used in) operating activities in % of revenue
Our consolidated statement of cash flows indicates how we generated and used cash and cash equivalents. In conjunction with our other primary interim financial statements, it provides information that helps us evaluate changes to our net assets and our financial structure (including liquidity and solvency). Net cash provided by (used in) operating activities is applied to assess whether a business can internally generate the cash required to make the necessary replacement and expansion of investments. This indicator is impacted by the profitability of our business and the development of working capital, mainly receivables. Net cash provided by (used in) operating activities in percent of revenue shows the percentage of our revenue that is available in terms of financial resources. This measure is an indicator of our operating financial strength.
Free cash flow in % of revenue (Non-IFRS Measure)
Free cash flow (which we define as net cash provided by (used in) operating activities after capital expenditures, before acquisitions and investments) refers to the cash flow we have at our disposal, including cash flows that may be restricted for other uses. This indicator shows the percentage of revenue available for acquisitions and investments, dividends to shareholders, reducing debt financing or for repurchasing shares.
For a reconciliation of cash flow performance indicators for the nine months ended September 30, 2022 and 2021 which reconciles free cash flow and free cash flow in percent of revenue to Net cash provided by (used in) operating activities and Net cash provided by (used in) operating activities in percent of revenue, see “III. Results of operations, financial position and net assets - Financial position - Sources of Liquidity.’’
Net leverage ratio (Non-IFRS Measure)
The net leverage ratio is a performance indicator used for capital management. To determine the net leverage ratio, debt and lease liabilities less cash and cash equivalents (net debt) is compared to adjusted EBITDA (earnings before interest, taxes, depreciation and amortization), adjusted for:
| ● | the effects of acquisitions and divestitures made during the last twelve months with a purchase price above a €50 M threshold as defined in our €2 billion sustainability-linked syndicated revolving credit facility (“Syndicated Credit Facility”) (see note 7 of the notes to the consolidated financial statements (unaudited) included in this report), |
| ● | non-cash charges, |
| ● | impairment loss, and |
| ● | special items, including: |
| i. | costs related to our FME25 Program, |
| ii. | the impact from applying hyperinflationary accounting under IAS 29, Financial Reporting in Hyperinflationary Economies (“IAS 29”), in Turkiye (“Hyperinflation in Turkiye”), |
| iii. | the impact from the remeasurement of our investment in Humacyte, Inc. (“Humacyte Investment Remeasurement”), |
| iv. | the net gain related to the InterWell Health business combination, including the remeasurement gain of our investment, prior to the transaction, in InterWell Health LLC, the impairment of certain long-lived assets belonging to Acumen Physician Solutions, LLC which was transferred to InterWell Health as part of the transaction and certain transaction-related costs (“Net Gain Related to InterWell Health”) (for further information regarding the InterWell Health business combination, see “I. Overview,” above, and note 2 of the notes to the consolidated financial statements (unaudited) included in this report), and |
| v. | bad debt expense in Russia and Ukraine and accruals for certain risks associated with allowances on inventories related to the Ukraine War (“Impacts Related to the War in Ukraine”). Although to date the Ukraine War has had minimal impact on our impairment testing of goodwill in the EMEA Segment, as we continue to treat patients and provide health care products to our clinics in those countries, receive reimbursements and generate cash flows, it has had an impact on the valuation of certain assets and receivables as a result of the ongoing hostilities. |
The ratio is an indicator of the length of time the Company needs to service the net debt out of its own resources. We believe that the net leverage ratio provides alternative information that management believes to be useful in assessing our ability to meet our payment obligations in addition to considering the absolute amount of our debt. We have a strong market position in a growing, global and mainly non-cyclical market. Furthermore, most of our customers have a high credit rating as the dialysis industry is characterized by stable and sustained cash flows. We believe this enables us to work with a reasonable proportion of debt.
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FRESENIUS MEDICAL CARE AG & Co. KGaA
Adjusted EBITDA, a non-IFRS Measure, is used in our capital management and is also relevant in major financing instruments, including the Syndicated Credit Facility. You should not consider adjusted EBITDA to be an alternative to net earnings determined in accordance with IFRS or to cash flow from operations, investing activities or financing activities. In addition, not all funds depicted by adjusted EBITDA are available for management’s discretionary use. For example, a substantial portion of such funds are subject to contractual restrictions and functional requirements to fund debt service, capital expenditures and other commitments from time to time as described in more detail elsewhere in this report.
For our self-set target range for the net leverage ratio and a reconciliation of adjusted EBITDA and net leverage ratio as of September 30, 2022 and December 31, 2021, see “III. Results of operations, financial position and net assets - Financial position - Sources of Liquidity.”
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FRESENIUS MEDICAL CARE AG & Co. KGaA
III. Results of operations, financial position and net assets
The following sections summarize our results of operations, financial position and net assets as well as key performance indicators by reporting segment, as well as Corporate, for the periods indicated. We prepared the information consistent with the manner in which management internally disaggregates financial information to assist in making operating decisions and evaluating management performance.
Results of operations
Segment data (including Corporate)
in € M
Revenue and operating income generated in countries outside the eurozone are subject to currency fluctuations. The table below summarizes the development of the euro against the U.S. dollar, as well as the revenue and the operating income generated in U.S. dollars, as a percentage of the consolidated results, for the three- and nine- month periods ended September 30, 2022 and 2021:
Currency development and portion of total revenue and operating income
16
Three months ended September 30, 2022 compared to three months ended September 30, 2021
Interim consolidated financials
Performance indicators for the interim consolidated financial statements
Change in % | ||||||||||
For the three months ended | Currency | |||||||||
September 30, | translation | Constant | ||||||||
| 2022 |
| 2021 |
| As reported |
| effects |
| Currency(1) | |
|
|
|
|
| ||||||
Revenue in € M | 5,096 |
| 4,441 |
| 15% | 12% | 3% | |||
Health care services | 4,082 |
| 3,530 |
| 16% | 14% | 2% | |||
Health care products | 1,014 |
| 911 |
| 11% | 7% | 4% | |||
Number of dialysis treatments | 13,220,000 |
| 13,297,287 |
| (1%) | |||||
Same Market Treatment Growth (2) | (1.3%) | (2.4%) | ||||||||
Gross profit in € M | 1,359 |
| 1,267 | 7% | 11% | (4%) | ||||
Gross profit as a % of revenue | 26.7% | 28.5% | ||||||||
Selling, general and administrative costs in € M | 990 |
| 731 | 35% | (13%) | 22% | ||||
Selling, general and administrative costs as a % of revenue | 19.4% | 16.5% | ||||||||
Operating income in € M | 472 |
| 505 | (7%) | 10% | (17%) | ||||
Operating income margin | 9.3% | 11.4% | ||||||||
Net income attributable to shareholders of FMC AG & Co. KGaA in € M | 230 |
| 273 |
| (16%) | 8% | (24%) | |||
Basic earnings per share in € | 0.78 |
| 0.93 |
| (16%) | 8% | (24%) | |||
| (1) | For further information on Constant Exchange Rates, see “II. Discussion of measures – Non–IFRS measures” above. |
| (2) | Same market treatment growth represents growth in treatments, adjusted for certain reconciling items including (but not limited to) treatments from acquisitions, closed or sold clinics and differences in dialysis days (“Same Market Treatment Growth”). |
Health care services revenue increased by 16% as compared to the three months ended September 30, 2021 (+2% at Constant Exchange Rates) driven by a positive impact from foreign currency translation (+14%) and organic growth (+2%), despite impacts from excess mortality rates among patients due to COVID-19 in certain of our operating segments which are further described in the discussions of our segments below.
Dialysis treatments decreased by 1% as a result of negative Same Market Treatment Growth (-1%) and the effect of closed or sold clinics (-1%), partially offset by contributions from acquisitions (+1%). Excess mortality rates among our patients due to COVID-19 contributed significantly to the decreases in treatments and Same Market Treatment Growth.
At September 30, 2022, we owned or operated 4,153 dialysis clinics compared to 4,151 dialysis clinics at September 30, 2021. During the three months ended September 30, 2022, we acquired 2 dialysis clinic, opened 11 dialysis clinics and combined or closed 23 clinics. The number of patients treated in dialysis clinics that we own or operate remained relatively stable at 344,593 as of September 30, 2022 (September 30, 2021: 344,872). Excess mortality rates among patients due to COVID-19 also significantly impacted the number of patients we treated.
Health care product revenue increased by 11% (+4% at Constant Exchange Rates), driven by a positive impact from foreign currency translation as well as higher sales of in-center disposables and renal pharmaceuticals, partially offset by lower sales of machines for chronic treatment (including the effect of a temporary pause in shipping of new dialysis machines in the U.S.) (see note 11 of the notes to the consolidated financial statements (unaudited) included in this report).
Gross profit increased by 7% (-4% at Constant Exchange Rates), primarily driven by a favorable impact from foreign currency translation effects (mainly in the North America Segment), government relief funding available for health care providers affected by the COVID-19 pandemic, which offset certain eligible costs, (North America Segment), favorable foreign currency transaction effects (Asia Pacific Segment, EMEA Segment and Latin America Segment), partially offset by higher personnel expense (primarily in the North America Segment) and inflationary and supply chain cost increases (across all regions).
Selling, general and administrative (“SG&A”) expense increased by 35% (+22% at Constant Exchange Rates), primarily driven by a negative impact from foreign currency translation (North America Segment, Asia-Pacific Segment, Corporate and Latin America Segment), costs related to the InterWell Health business combination in the North America Segment (“InterWell Health Costs”) (see note 2 of the notes to the consolidated financial statements (unaudited) included in this report), costs associated with the FME 25 Program (Corporate, EMEA Segment and North America Segment) and an unfavorable impact from the remeasurement of investments (primarily
17
FRESENIUS MEDICAL CARE AG & Co. KGaA
driven by the Humacyte Investment Remeasurement in the North America Segment), partially offset by increased income attributable to a consent agreement on certain pharmaceuticals in the North America Segment.
Research and development expenses increased by 17% to €61 M from €52 M. The increase was largely driven by a negative impact from foreign currency translation and research and development activities at NxStage Medical, Inc., our subsidiary, and in the field of regenerative medicine.
Income from equity method investees decreased by 17% to €17 M from €21 M. The decrease was primarily driven by lower earnings from Vifor Fresenius Medical Care Renal Pharma Ltd. (“VFMCRP”) and a negative impact from foreign currency translation.
We recorded a remeasurement gain of our prior at-equity investment in InterWell Health LLC in the amount of €147 M (September 30, 2021: €0). For further information regarding the InterWell Health business combination, see “I. Overview” and “II. Discussion of measures – Net leverage ratio (Non-IFRS Measure),” above, as well as note 2 of the notes to the consolidated financial statements (unaudited) included in this report.
Operating income decreased by 7% (-17% at Constant Exchange Rates), largely driven by the combined effects of the items discussed within gross profit, SG&A expense and the InterWell Health remeasurement gain as well as a positive impact from foreign currency translation. We have seen unprecedented challenges in the labor market in the U.S., resulting in staff shortages, high turnover rates and meaningfully higher costs, including higher costs due to an increased reliance on contracted labor. These challenges continue to impact growth, specifically in U.S. health care services where labor constraints have affected our ability to increase treatment volumes. These impacts, combined with the current uncertainty in the macroeconomic environment, driving inflationary cost increases and supply chain constraints, have had an adverse effect on our results of operations during 2022 and we expect them to continue for the remainder of the year.
Net interest expense increased by 12% to €76 M from €68 M, primarily due a negative impact from foreign currency translation, unfavorable effects from foreign currency swaps and lower interest income related to royalty receivables, partially offset by refinancing activities (including the issuance of bonds in prior periods at lower interest rates).
Income tax expense increased by 7% to €112 M from €105 M. The effective tax rate increased to 28.4% from 24.1% for the same period of 2021 largely driven by an increase in the proportionate share of non-deductible expenses as compared to taxable income and higher tax provisions related to tax law changes. Non-tax deductible expenses also increased due to the InterWell Health business combination and hyperinflation in Argentina and Turkiye. The increase in the effective tax rate was partially offset by a larger portion of tax-free income attributable to noncontrolling interests compared to income before income taxes.
Net income attributable to noncontrolling interests decreased by 9% to €54 M from €59 M due to lower earnings in entities in which we have less than 100% ownership, partially offset by a negative impact from foreign currency translation.
Net income attributable to shareholders of FMC AG & Co. KGaA decreased by 16% (-24% at Constant Exchange Rates) as a result of the combined effects of the items discussed above, partially offset by a positive impact from foreign currency translation.
Basic earnings per share decreased by 16% (-24% at Constant Exchange Rates), primarily due to the decrease in net income attributable to shareholders of FMC AG & Co. KGaA described above. The average weighted number of shares outstanding for the period increased to 293.4 M on September 30, 2022 as compared to the prior year period (September 30, 2021: 293.0 M) primarily due to the exercise of stock options.
We employed 122,758 people (full-time equivalents) as of September 30, 2022 (September 30, 2021: 123,528). This 1% decrease was largely due to a prior year increase in production staff due to COVID-19 and a reduction in clinical staff as a result of a decrease in patients in certain regions.
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FRESENIUS MEDICAL CARE AG & Co. KGaA
The following discussions pertain to our operating and reportable segments and the measures we use to manage these segments.
North America Segment
Performance indicators for the North America Segment
Change in % | ||||||||||
For the three months ended | Currency | |||||||||
September 30, | translation | Constant | ||||||||
2022 | 2021 | As reported | effects | Currency(1) | ||||||
|
|
|
|
|
|
| ||||
Revenue in € M |
| 3,556 | 3,080 |
| 15% | 16% | (1%) | |||
Health care services |
| 3,269 | 2,810 |
| 16% | 16% | 0% | |||
Health care products |
| 287 | 270 |
| 6% | 15% | (9%) | |||
Number of dialysis treatments |
| 8,048,664 | 8,152,833 | (1%) |
| |||||
Same Market Treatment Growth |
| (2.5%) | (2.2%) |
| ||||||
Operating income in € M |
| 469 | 446 | 5% | 13% | (8%) | ||||
Operating income margin |
| 13.2% | 14.5% |
|
|
| ||||
| (1) | For further information on Constant Exchange Rates, see “II. Discussion of measures – Non–IFRS measures” above. |
Revenue
Health care services revenue increased by 16% (remained relatively stable at Constant Exchange Rates), driven by a positive impact from foreign currency translation (+16%) and contributions from acquisitions (+1%), partially offset by a decrease in organic growth (-1%) resulting from the effects of excess mortality rates among patients due to COVID-19.
Dialysis treatments decreased by 1% largely due to negative Same Market Treatment Growth (-3%), partially offset by contributions from acquisitions (+1%) and an increase in dialysis days (+1%). As of September 30, 2022, 208,275 patients, a decrease of 1% (September 30, 2021: 209,651), were treated in the 2,699 dialysis clinics (September 30, 2021: 2,683) that we own or operate in the North America Segment. Excess mortality rates among patients due to COVID-19 contributed significantly to the decreases in treatments, patients and Same Market Treatment Growth.
Health care product revenue increased by 6% (-9% at Constant Exchange Rates), driven by a positive impact from foreign currency translation, partially offset by lower sales of machines for chronic treatment (including the effect of a temporary pause in shipping of new dialysis machines in the U.S.) (see note 11 of the notes to the consolidated financial statements (unaudited) included in this report), products for acute care treatments and in-center disposables.
Operating income
Operating income increased by 5% (-8% at Constant Exchange Rates), primarily related to government relief funding available for health care providers affected by the COVID-19 pandemic, which offset certain eligible costs, a positive impact from foreign currency translation, the Net Gain Related to InterWell Health and increased income attributable to a consent agreement on certain pharmaceuticals, partially offset by higher personnel expense, an unfavorable impact from excess mortality rates among our patients due to COVID-19 as well as inflationary and supply chain cost increases. We have seen unprecedented challenges in the labor market in the U.S., resulting in staff shortages, high turnover rates and meaningfully higher costs, including higher costs due to an increased reliance on contracted labor. These challenges continue to impact growth and have affected our ability to increase treatment volumes. These impacts have had an adverse effect on our results of operations during 2022 and we expect them to continue for the remainder of the year.
19
EMEA Segment
Performance indicators for the EMEA Segment
Change in % | ||||||||||
For the three months ended | Currency | |||||||||
September 30, | translation | Constant | ||||||||
2022 | 2021 | As reported | effects | Currency(1) | ||||||
|
|
|
|
|
|
| ||||
Revenue in € M |
| 720 |
| 671 |
| 7% | (1%) | 8% | ||
Health care services |
| 377 |
| 346 |
| 9% | 1% | 8% | ||
Health care products |
| 343 |
| 325 |
| 6% | (2%) | 8% | ||
Number of dialysis treatments |
| 2,509,378 |
| 2,480,332 | 1% |
| ||||
Same Market Treatment Growth |
| 0.5% | (4.0%) |
| ||||||
Operating income in € M |
| 48 | 79 | (40%) | 1% | (41%) | ||||
Operating income margin |
| 6.6% | 11.7% |
|
|
|
| |||
(1) | For further information on Constant Exchange Rates, see “II. Discussion of measures – Non–IFRS measures” above. |
Revenue
Health care service revenue increased by 9% (+8% at Constant Exchange Rates), driven by an increase in organic growth, including the effects of Hyperinflation in Turkiye, (+8%) and a positive impact from foreign currency translation (+1%).
Dialysis treatments increased by 1% due to Same Market Treatment Growth (+1%). As of September 30, 2022, 66,293 patients, an increase of 1% (September 30, 2021: 65,336), were treated at the 814 dialysis clinics (September 30, 2021: 816) that we own or operate in the EMEA Segment.
Health care product revenue increased by 6% (+8% at Constant Exchange Rates), primarily due to higher sales of in-center disposables and renal pharmaceuticals (including the effects of Hyperinflation in Turkiye), partially offset by a negative impact from foreign currency translation and lower sales of acute cardiopulmonary products.
Operating income
Operating income decreased by 40% (-41% at Constant Exchange Rates), mainly due to inflationary cost increases (including Hyperinflation in Turkiye), costs associated with the FME 25 Program and lower income from certain equity method investees.
20
Asia-Pacific Segment
Performance indicators for the Asia-Pacific Segment
Change in % | ||||||||||
For the three months ended | Currency | |||||||||
September 30, | translation | Constant | ||||||||
2022 | 2021 | As reported | effects | Currency(1) | ||||||
|
|
|
|
|
|
| ||||
Revenue in € M |
| 565 |
| 501 |
| 13% | 6% | 7% | ||
Health care services |
| 256 |
| 239 |
| 7% | 2% | 5% | ||
Health care products |
| 309 |
| 262 |
| 18% | 9% | 9% | ||
Number of dialysis treatments |
| 1,225,891 | 1,201,888 |
| 2% | |||||
Same Market Treatment Growth |
| 2.5% | 3.4% | |||||||
Operating income in € M |
| 85 | 86 | (1%) | 1% | (2%) | ||||
Operating income margin |
| 15.1% | 17.2% |
|
| |||||
(1) | For further information on Constant Exchange Rates, see “II. Discussion of measures – Non–IFRS measures” above. |
Revenue
Health care services revenue increased by 7% (+5% at Constant Exchange Rates), driven by an increase in organic growth (+5%), a positive impact from foreign currency translation (+2%) and contributions from acquisitions (+1%), partially offset by the effect of closed or sold clinics (-1%).
Dialysis treatments increased by 2% mainly due to Same Market Treatment Growth (+2%) and contributions from acquisitions (+1%), partially offset by the effect of closed or sold clinics (-1%). As of September 30, 2022, 33,800 patients, an increase of 1% (September 30, 2021: 33,434) were treated at the 397 dialysis clinics (September 30, 2021: 406) that we own or operate in the Asia-Pacific Segment.
Health care product revenue increased by 18% (+9% at Constant Exchange Rates), mainly due to a positive impact from foreign currency translation as well as higher sales of products for in-center disposables, acute care treatments and machines for chronic treatment.
Operating income
Operating income decreased by 1% (-2% at Constant Exchange Rates), primarily due to inflationary cost increases and higher bad debt expense, partially offset by favorable foreign currency transaction effects and business growth in certain business lines.
21
Latin America Segment
Performance indicators for the Latin America Segment
Change in % | ||||||||||
For the three months ended | Currency | |||||||||
September 30, | translation | Constant | ||||||||
2022 | 2021 | As reported | effects | Currency(1) | ||||||
|
|
|
|
| ||||||
Revenue in € M |
| 243 |
| 178 |
| 36% | 0% | 36% | ||
Health care services |
| 173 |
| 126 |
| 37% | (5%) | 42% | ||
Health care products |
| 70 |
| 52 |
| 35% | 12% | 23% | ||
Number of dialysis treatments |
| 1,436,067 |
| 1,462,234 |
| (2%) | ||||
Same Market Treatment Growth |
| (0.7%) | (5.2%) | |||||||
Operating income in € M |
| 11 | 4 | 150% | 20% | 130% | ||||
Operating income margin | 4.5% | 2.4% |
|
| ||||||
(1) | For further information on Constant Exchange Rates, see “II. Discussion of measures – Non–IFRS measures” above. |
Revenue
Health care service revenue increased by 37% (+42% at Constant Exchange Rates), driven by an increase in organic growth, (+43%), partially offset by a negative impact from foreign currency translation (-5%) and the effect of closed or sold clinics (-1%).
Dialysis treatments decreased by 2% mainly due to the effect of closed or sold clinics (-1%) and negative Same Market Treatment Growth (-1%). As of September 30, 2022, 36,225 patients (September 30, 2021: 36,451), were treated at the 243 dialysis clinics (September 30, 2021: 246) that we own or operate in the Latin America Segment. Excess mortality rates among patients due to COVID-19 contributed to the decreases in treatments and Same Market Treatment Growth.
Health care product revenue increased by 35% (+23% at Constant Exchange Rates), primarily due to higher sales of machines for chronic treatment, a positive impact from foreign currency translation and higher sales of in-center disposables.
Operating income
Operating income increased by 150% (130% at Constant Exchange Rates), primarily due to income from investments in debt securities, favorable foreign currency transaction effects, lower bad debt expense and a positive impact from foreign currency translation, partially offset by inflationary cost increases.
22
Nine months ended September 30, 2022 compared to nine months ended September 30, 2021
Interim consolidated financials
Performance indicators for the interim consolidated financial statements
| Change in % | |||||||||
For the nine months ended | Currency | |||||||||
September 30, | translation | Constant | ||||||||
| 2022 |
| 2021 |
| As reported |
| effects |
| Currency(1) | |
Revenue in € M |
| 14,401 |
| 12,972 |
| 11% | 9% | 2% | ||
Health care services |
| 11,471 |
| 10,255 |
| 12% | 10% | 2% | ||
Health care products |
| 2,930 |
| 2,717 |
| 8% | 5% | 3% | ||
Number of dialysis treatments |
| 39,152,144 |
| 39,510,028 |
| (1%) |
|
| ||
Same Market Treatment Growth |
| (1.4%) | (1.9%) |
|
|
|
| |||
Gross profit in € M |
| 3,963 |
| 3,758 |
| 5% | 8% | (3%) | ||
Gross profit as a % of revenue |
| 27.5% | 29.0% |
|
|
|
|
| ||
Selling general and administrative costs in € M |
| 2,830 |
| 2,273 |
| 25% | (10%) | 15% | ||
Selling, general and administrative costs as a % of revenue |
| 19.7% | 17.5% |
|
|
|
|
| ||
Operating income in € M |
| 1,160 |
| 1,403 |
| (17%) | 7% | (24%) | ||
Operating income margin |
| 8.1% | 10.8% |
|
|
|
|
| ||
Net income attributable to shareholders of FMC AG & Co. KGaA in € M |
| 535 |
| 741 |
| (28%) | 6% | (34%) | ||
Basic earnings per share in € |
| 1.82 |
| 2.53 |
| (28%) | 6% | (34%) | ||
| (1) | For further information on Constant Exchange Rates, see “II. Discussion of measures – Non–IFRS measures” above. |
Health care services revenue increased by 12% as compared to the nine months ended September 30, 2021 (+2% at Constant Exchange Rates) driven by a positive impact from foreign currency translation (+10%), an increase in organic growth (+1%), despite impacts from excess mortality rates among patients due to COVID-19 certain of our operating segments which are further described in the discussions of our segments below, and contributions from acquisitions (+1%).
Dialysis treatments decreased by 1% as a result of negative Same Market Treatment Growth (-1%) and the effect of closed or sold clinics (-1%), partially offset by contributions from acquisitions (+1%). Excess mortality rates among our patients due to COVID-19 contributed significantly to the decreases in treatments and Same Market Treatment Growth.
Health care product revenue increased by 8% (+3% at Constant Exchange Rates), driven by a positive impact from foreign currency translation as well as higher sales of in-center disposables and renal pharmaceuticals, partially offset by lower sales of machines for chronic treatment (including the effect of a temporary pause in shipping of new dialysis machines in the U.S.) (see note 11 of the notes to the consolidated financial statements (unaudited) included in this report) and acute cardiopulmonary products.
Gross profit increased by 5% (-3% at Constant Exchange Rates), primarily driven by a favorable impact from foreign currency translation effects (North America Segment, Asia-Pacific Segment and Latin America Segment), government relief funding available for health care providers affected by the COVID-19 pandemic, which offset certain eligible costs, (North America Segment), higher average reimbursement rates (North America Segment, EMEA Segment and Latin America Segment), a favorable impact from foreign currency transaction effects (mainly in the Asia-Pacific Segment and the EMEA Segment), increased treatment volumes (including growth from acquisitions) as normalized for COVID-19 (North America Segment, Asia-Pacific Segment and EMEA Segment) and a positive impact from a partial reversal of an accrual related to a revenue recognition adjustment for accounts receivable in legal dispute (North America Segment), partially offset by higher personnel expense and inflationary and supply chain cost increases across all regions as well as an unfavorable impact from excess mortality rates among our patients due to COVID-19 (mainly in the North America Segment).
SG&A expense increased by 25% (+15% at Constant Exchange Rates), primarily driven by a negative impact from foreign currency translation (North America Segment, Asia-Pacific Segment and Corporate), an unfavorable impact from the remeasurement of investments (primarily driven by the Humacyte Investment Remeasurement in the North America Segment), InterWell Health Costs in the North America Segment (see note 2 of the notes to the consolidated financial statements (unaudited) included in this report), costs associated with the FME25 Program (mainly in Corporate, the EMEA Segment and the North America Segment), higher personnel expense (North America Segment and Latin America Segment) and higher information technology costs (Corporate and the North America Segment), partially offset by increased income attributable to a consent agreement on certain pharmaceuticals in the North America Segment.
23
FRESENIUS MEDICAL CARE AG & Co. KGaA
Research and development expenses increased by 9% to €167 M from €153 M. The increase was largely driven by a negative impact from foreign currency translation and research and development activities at NxStage Medical, Inc., our subsidiary, and in the field of regenerative medicine.
Income from equity method investees decreased by 34% to €47 M from €71 M. The decrease was primarily driven by lower earnings from VFMCRP.
We recorded a remeasurement gain of our prior at-equity investment in InterWell Health LLC in the amount of €147 M (September 30, 2021: €0). For further information regarding the InterWell Health business combination, see “I. Overview” and “II. Discussion of measures – Net leverage ratio (Non-IFRS Measure),” above, as well as note 2 of the notes to the consolidated financial statements (unaudited) included in this report.
Operating income decreased by 17% (-24% at Constant Exchange Rates), largely driven the combined effects of the items discussed within gross profit, SG&A expense and the InterWell Health remeasurement gain as well as a positive impact from foreign currency translation. We have seen unprecedented challenges in the labor market in the U.S., resulting in staff shortages, high turnover rates and meaningfully higher costs, including higher costs due to an increased reliance on contracted labor. These challenges continue to impact growth, specifically in U.S. health care services where labor constraints have affected our ability to increase treatment volumes. These impacts, combined with the current uncertainty in the macroeconomic environment, driving inflationary cost increases and supply chain constraints, have had an adverse effect on our results of operations during 2022 and we expect them to continue for the remainder of the year.
Net interest expense increased by 2% to €217 M from €214 M, primarily due to a negative impact from foreign currency translation and unfavorable effects from foreign currency swaps, partially offset by refinancing activities (including the issuance of bonds in prior periods at lower interest rates and the repayment of term loans).
Income tax expense decreased by 12% to €242 M from €274 M. The effective tax rate increased to 25.7% from 23.0% for the same period of 2021 largely driven by an increase in the proportionate share of non-deductible expenses as compared to taxable income and higher tax provisions related to tax law changes. Non-tax deductible expenses also increased due to the InterWell Health business combination and hyperinflation in Argentina and Turkiye. The increase in the effective tax rate was partially offset by a larger portion of tax-free income attributable to noncontrolling interests compared to income before income taxes.
Net income attributable to noncontrolling interests decreased by 5% to €166 M from €174 M due to lower earnings in entities in which we have less than 100% ownership, partially offset by a negative impact from foreign currency translation.
Net income attributable to shareholders of FMC AG & Co. KGaA decreased by 28% (-34% at Constant Exchange Rates) as a result of the combined effects of the items discussed above, partially offset by a positive impact from foreign currency translation.
Basic earnings per share decreased by 28% (-34% at Constant Exchange Rates), primarily due to the decrease in net income attributable to shareholders of FMC AG & Co. KGaA described above, partially offset by a positive impact from foreign currency translation. The average weighted number of shares outstanding for the period increased to 293.2 M on September 30, 2022 (September 30, 2021: 292.9 M), primarily due to the exercise of stock options.
The following discussions pertain to our operating and reportable segments and the measures we use to manage these segments.
24
North America Segment
Performance indicators for the North America Segment | ||||||||||
| Change in % | |||||||||
For the nine months ended | Currency | |||||||||
September 30, | translation | Constant | ||||||||
| 2022 |
| 2021 |
| As reported |
| effects |
| Currency(1) | |
Revenue in € M |
| 10,021 |
| 8,931 |
| 12% | 12% | 0% | ||
Health care services |
| 9,184 |
| 8,148 |
| 13% | 13% | 0% | ||
Health care products |
| 837 |
| 783 |
| 7% | 12% | (5%) | ||
Number of dialysis treatments |
| 23,816,538 |
| 24,158,943 |
| (1%) |
|
|
| |
Same Market Treatment Growth |
| (2.3%) | (2.5%) |
|
|
|
|
| ||
Operating income in € M |
| 1,113 |
| 1,242 |
| (10%) | 10% | (20%) | ||
Operating income margin |
| 11.1% | 13.9% |
|
|
|
|
| ||
(1) | For further information on Constant Exchange Rates, see “II. Discussion of measures – Non–IFRS measures” above. |
Revenue
Health care services revenue increased by 13% (remained relatively stable at Constant Exchange Rates), driven by a positive impact from foreign currency translation (+13%) and contributions from acquisitions (+1%), partially offset by a decrease in organic growth (-1%) resulting from the effects of excess mortality rates among patients due to COVID-19.
Dialysis treatments decreased by 1% largely due to negative Same Market Treatment Growth (-2%), partially offset by contributions from acquisitions (+1%). Excess mortality rates among patients due to COVID-19 contributed significantly to the decreases in treatments and Same Market Treatment Growth.
Health care product revenue increased by 7% (-5% at Constant Exchange Rates), driven by a positive impact from foreign currency translation, partially offset by lower sales of machines for chronic treatment (including the effect of a temporary pause in shipping of new dialysis machines in the U.S.) (see note 11 of the notes to the consolidated financial statements (unaudited) included in this report), products for acute care treatments and in-center disposables.
Operating income
Operating income decreased by 10% (-20% at Constant Exchange Rates), primarily related to higher personnel expense, the Humacyte Investment Remeasurement, an unfavorable impact from excess mortality rates among our patients due to COVID-19 and inflationary and supply chain cost increases partially offset by government relief funding available for health care providers affected by the COVID-19 pandemic, which offset certain eligible costs, a positive impact from foreign currency translation and the Net Gain Related to InterWell Health. We have seen unprecedented challenges in the labor market in the U.S., resulting in staff shortages, high turnover rates and meaningfully higher costs, including higher costs due to an increased reliance on contracted labor. These challenges continue to impact growth and have affected our ability to increase treatment volumes. These impacts have had an adverse effect on our results of operations during 2022 and we expect them to continue for the remainder of the year.
25
EMEA Segment
Performance indicators for the EMEA Segment | ||||||||||
| Change in % | |||||||||
For the nine months ended | Currency | |||||||||
September 30, | translation | Constant | ||||||||
| 2022 |
| 2021 |
| As reported |
| effects |
| Currency(1) | |
Revenue in € M |
| 2,121 |
| 2,033 |
| 4% | (2%) | 6% | ||
Health care services |
| 1,083 |
| 1,020 |
| 6% | (1%) | 7% | ||
Health care products |
| 1,038 |
| 1,013 |
| 2% | (3%) | 5% | ||
Number of dialysis treatments |
| 7,428,380 |
| 7,384,018 |
| 1% |
|
|
| |
Same Market Treatment Growth |
| (0.1%) | (3.5%) |
|
|
|
|
| ||
Operating income in € M |
| 169 |
| 232 |
| (27%) | (1%) | (26%) | ||
Operating income margin |
| 8.0% | 11.4% |
|
|
|
|
| ||
(1) | For further information on Constant Exchange Rates, see “II. Discussion of measures – Non–IFRS measures” above. |
Revenue
Health care service revenue increased by 6% (+7% at Constant Exchange Rates), driven by an increase in organic growth, including the effects of Hyperinflation in Turkiye, (+6%) and contributions from acquisitions (+1%), partially offset by a negative impact resulting from foreign currency translation (-1%).
Dialysis treatments increased by 1% mainly due to contributions from acquisitions in the region (+1%).
Health care product revenue increased by 2% (+5% at Constant Exchange Rates), primarily due to higher sales of in-center disposables and renal pharmaceuticals (including the effects of Hyperinflation in Turkiye), partially offset by a negative impact from foreign currency translation as well as lower sales of acute cardiopulmonary products and machines for chronic treatment (including the effects of Hyperinflation in Turkiye).
Operating income
Operating income decreased by 27% (-26% at Constant Exchange Rates), mainly due to inflationary cost increases (including Hyperinflation in Turkiye), Impacts Related to the War in Ukraine, costs associated with the FME 25 Program and lower income from certain equity method investees, partially offset by favorable foreign currency transaction effects.
26
Asia-Pacific Segment
Performance indicators for the Asia-Pacific Segment | ||||||||||
| Change in % | |||||||||
For the nine months ended | Currency | |||||||||
September 30, | translation | Constant | ||||||||
| 2022 |
| 2021 |
| As reported |
| effects |
| Currency(1) | |
Revenue in € M |
| 1,588 |
| 1,458 |
| 9% | 5% | 4% | ||
Health care services |
| 730 |
| 694 |
| 5% | 2% | 3% | ||
Health care products |
| 858 |
| 764 |
| 12% | 7% | 5% | ||
Number of dialysis treatments |
| 3,613,229 |
| 3,559,846 |
| 1% |
|
|
| |
Same Market Treatment Growth |
| 2.2% | 5.5% |
|
|
|
|
| ||
Operating income in € M |
| 255 |
| 256 |
| 0% | 1% | (1%) | ||
Operating income margin |
| 16.1% | 17.5% |
|
|
|
|
| ||
(1) | For further information on Constant Exchange Rates, see “II. Discussion of measures – Non–IFRS measures” above. |
Revenue
Health care services revenue increased by 5% (+3% at Constant Exchange Rates), driven by an increase in organic growth (+3%), a positive impact from foreign currency translation (+2%) and contributions from acquisitions (+1%), partially offset by the effect of closed or sold clinics (-1%).
Dialysis treatments increased by 1% mainly due to Same Market Treatment Growth (+2%), partially offset by the effect of closed or sold clinics (-1%).
Health care product revenue increased by 12% (+5% at Constant Exchange Rates), mainly due to a positive impact from foreign currency translation as well as higher sales of products for in-center disposables, acute care treatments, and acute cardiopulmonary products.
Operating income
Operating income remained relatively stable (-1% at Constant Exchange Rates), as inflationary cost increases were mostly offset by favorable foreign currency transaction effects.
27
Latin America Segment
Performance indicators for the Latin America Segment | ||||||||||
| Change in % | |||||||||
For the nine months ended | Currency | |||||||||
September 30, | translation | Constant | ||||||||
| 2022 |
| 2021 |
| As reported |
| effects |
| Currency(1) | |
Revenue in € M |
| 633 |
| 508 |
| 25% | 2% | 23% | ||
Health care services |
| 452 |
| 364 |
| 24% | (2%) | 26% | ||
Health care products |
| 181 |
| 144 |
| 26% | 10% | 16% | ||
Number of dialysis treatments |
| 4,293,997 |
| 4,407,221 |
| (3%) |
|
|
| |
Same Market Treatment Growth |
| (1.4%) | (1.0%) |
|
|
|
|
| ||
Operating income in € M |
| 16 |
| 14 |
| 17% | 23% | (6%) | ||
Operating income margin |
| 2.5% | 2.7% |
|
|
|
|
| ||
(1) | For further information on Constant Exchange Rates, see “II. Discussion of measures – Non–IFRS measures” above. |
Revenue
Health care service revenue increased by 24% (+26% at Constant Exchange Rates), driven by an increase in organic growth (+27%), partially offset by a negative impact from foreign currency translation (-2%) and the effect of closed or sold clinics (-1%).
Dialysis treatments decreased by 3% mainly due to the effect of closed or sold clinics (-2%) and negative Same Market Treatment Growth (-1%). Excess mortality rates among patients due to COVID-19 contributed to the decreases in treatments and Same Market Treatment Growth.
Health care product revenue increased by 26% (+16% at Constant Exchange Rates), primarily due to a positive impact from foreign currency translation as well as higher sales of machines for chronic treatment and in-center disposables.
Operating income
Operating income increased by 17% (-6% at Constant Exchange Rates), primarily due to favorable foreign currency transaction effects, lower bad debt expense and a positive impact from foreign currency translation, partially offset by inflationary cost increases.
28
FRESENIUS MEDICAL CARE AG & Co. KGaA
Financial position
Sources of liquidity
Our primary sources of liquidity are typically cash provided by operating activities, cash provided by short-term debt, proceeds from the issuance of long-term debt and divestitures. We require this capital primarily to finance working capital needs, fund acquisitions, operate clinics, develop free-standing renal dialysis clinics and other health care facilities, purchase equipment for existing or new renal dialysis clinics and production sites, repay debt and pay dividends (see “Net cash provided by (used in) investing activities” and “Net cash provided by (used in) financing activities” below) and to satisfy put option obligations to holders of minority interests in our majority-owned subsidiaries.
As of September 30, 2022, our available borrowing capacity under unutilized credit facilities amounted to approximately €3.0 billion, including €2.0 billion under the Syndicated Credit Facility, which we maintain as a backup for general corporate purposes. On June 8, 2022, we amended and extended the Syndicated Credit Facility to extend the term by one year and replace U.S. dollar-LIBOR as the reference rate with the Term Secured Overnight Financing Rate.
In our long-term capital management, we focus primarily on the net leverage ratio, a Non-IFRS measure, see “II. Discussion of measures – Non–IFRS measures – Net leverage ratio (Non-IFRS Measure),” above. Our self-set target for the net leverage ratio is 3.0 - 3.5x, which management considers appropriate for the Company. The following table shows the reconciliation of net debt and adjusted EBITDA and the calculation of the net leverage ratio as of September 30, 2022 and December 31, 2021. As of September 30, 2022, we exceeded our self-set target for the net leverage ratio, but expect to be within the target range at the end of 2022.
Reconciliation of adjusted EBITDA and net leverage ratio to the most directly comparable IFRS financial measure
in € M, except for net leverage ratio
(1) | Debt includes the following balance sheet line items: short-term debt, current portion of long-term debt and long-term debt, less current portion. |
(2) | Last twelve months. |
(3) | Acquisitions and divestitures made for the last twelve months with a purchase price above a €50 M threshold as defined in the Syndicated Credit Facility (2022: -€27 M; 2021: €13 M), non-cash charges, primarily related to pension expense (2022: €52 M; 2021: €49 M), impairment loss (2022: €88 M; 2021: €38 M) and special items, including costs related to the FME25 Program (2022: €106 M; 2021: €25 M), Net Gain Related to InterWell Health (2022: -€113 M), Humacyte Investment Remeasurement (2022: €79 M), Hyperinflation in Turkiye (2022: €6 M) and the Impacts Related to the War in Ukraine (2022: €23 M). |
At September 30, 2022, we had cash and cash equivalents of €1,114 M (December 31, 2021: €1,482 M).
Free cash flow (Net cash provided by (used in) operating activities, after capital expenditures, before acquisitions and investments) is a Non-IFRS Measure and is reconciled to net cash provided by (used in) operating activities, the most directly comparable IFRS measure, see “II. Discussion of measures – Non–IFRS measures – Net cash provided by (used in) operating activities in % of revenue” and “– Free cash flow in % of revenue (Non-IFRS Measure)” above.
The following table shows the cash flow performance indicators for the nine months ended September 30, 2022 and 2021 and reconciles free cash flow and free cash flow in percent of revenue to Net cash provided by (used in) operating activities and Net cash provided by (used in) operating activities in percent of revenue, respectively:
29
Cash flow measures
in € M, except where otherwise specified
For the nine months ended | ||||
September 30, | ||||
| 2022 |
| 2021 | |
Revenue |
| 14,401 |
| 12,972 |
Net cash provided by (used in) operating activities |
| 1,568 |
| 1,820 |
Capital expenditures |
| (495) |
| (588) |
Proceeds from sale of property, plant and equipment |
| 9 |
| 27 |
Capital expenditures, net |
| (486) |
| (561) |
Free cash flow |
| 1,082 | 1,259 | |
Net cash provided by (used in) operating activities in % of revenue |
| 10.9% | 14.0% | |
Free cash flow in % of revenue |
| 7.5% | 9.7% | |
Net cash provided by (used in) operating activities
In the first nine months of 2022, net cash provided by operating activities was €1,568 M, compared to €1,820 M in the first nine months of 2021. Net cash provided by operating activities in percent of revenue decreased to 11% for the first nine months of 2022 as compared to 14% for the comparable period of 2021. Net cash provided by (used in) operating activities is impacted by the profitability of our business, the development of our working capital, principally inventories, receivables and cash outflows that occur due to a number of specific items as discussed below. The decrease in net cash provided by operating activities was mainly driven by a decrease in net income and a reduction in cash flow due to an increase in working capital, partially offset by COVID-19-related government relief funding in the United States.
The profitability of our business depends significantly on reimbursement rates for our services. Approximately 80% of our revenue is generated by providing health care services, a major portion of which is reimbursed by either public health care organizations or private insurers. For the nine months ended September 30, 2022, approximately 30% of our consolidated revenue was attributable to reimbursements from U.S. federal health care benefit programs, such as Medicare and Medicaid. Legislative changes could affect Medicare reimbursement rates for a significant portion of the services we provide as well as the scope of Medicare coverage. A decrease in reimbursement rates or the scope of coverage could have a material adverse effect on our business, financial position and results of operations and thus on our capacity to generate cash flow. See “I. Overview,” above. During 2022, our profitability has also been adversely affected by the global economic impact of the ongoing Ukraine War and increased headwinds from U.S. labor market and global inflation (see note 1 of the notes to the consolidated financial statements (unaudited) included in this report).
We intend to continue to address our current cash and financing requirements using net cash provided by operating activities, issuances under our commercial paper program (see note 6 of the notes to the consolidated financial statements (unaudited) included in this report) as well as from the use of our accounts receivable securitization program (“Accounts Receivable Facility”) and bilateral credit lines. The Syndicated Credit Facility is also available for backup financing needs. In addition, to finance acquisitions or meet other needs, we expect to utilize long-term financing arrangements, such as the issuance of bonds (see “Net cash provided by (used in) financing activities,” below).
Net cash provided by (used in) operating activities depends on the collection of accounts receivable. Commercial customers and government institutions generally have different payment cycles. Lengthening their payment cycles could have a material adverse effect on our capacity to generate cash flow. In addition, we could face difficulties enforcing and collecting accounts receivable under the legal systems of, and due to the economic conditions in, some countries. Accounts receivable balances, net of expected credit losses, represented Days Sales Outstanding (“DSO”) of 69 days at September 30, 2022 (December 31, 2021: 62 days).
DSO by segment is calculated by dividing the respective segment’s accounts and other receivables from unrelated parties less contract liabilities, converted to euro using the average exchange rate for the period presented, less any sales or value-added tax included in the receivables, by the average daily sales for the last twelve months of that segment, converted to euro using the average exchange rate for the period. Receivables and revenues are adjusted for amounts related to acquisitions and divestitures made within the reporting period with a purchase price above a €50 M threshold, consistent with the respective adjustments in the determination of adjusted EBITDA (see “II. Discussion of measures — Non-IFRS measures — Net leverage ratio (Non-IFRS Measure)” above).
30
The development of DSO by reporting segment is shown in the table below:
Development of days sales outstanding
in days
| September 30, |
| December 31, |
| ||
| 2022 |
| 2021 |
| Increase/decrease primarily driven by: | |
North America Segment |
| 55 |
| 44 |
| CMS’s recoupment of advanced payments received in 2020 under the Medicare Accelerated and Advance Payment Program |
EMEA Segment |
| 89 |
| 88 |
| Periodic delays in payment of public health care organizations in certain countries |
Asia-Pacific Segment |
| 102 |
| 103 |
| Improvement of payment collections in the region |
Latin America Segment |
| 116 |
| 130 |
| Improvement of payment collections in the region |
FMC AG & Co. KGaA average days sales outstanding |
| 69 |
| 62 |
|
|
Due to the fact that a large portion of our reimbursement is provided by public health care organizations and private insurers, we expect that most of our accounts receivable will be collectible.
For information regarding litigation exposure as well as ongoing and future tax audits, see note 11 of the notes to the consolidated financial statements (unaudited) included in this report.
Net cash provided by (used in) investing activities
Net cash used in investing activities in the first nine months of 2022 was €510 M as compared to net cash used in investing activities of €773 M in the comparable period of 2021. The following table shows a breakdown of our investing activities for the first nine months of 2022 and 2021:
Cash flows relating to investing activities
in € M
| (1) | Acquisitions in the North America Segment are net of cash acquired in the InterWell Health business combination. See note 2 of the notes to the consolidated financial statements (unaudited) included in this report. |
The majority of our capital expenditures in the first nine months of 2022 was used for maintaining existing clinics and centers, capitalization of machines provided to our customers, capitalization of certain development costs, equipping new clinics and centers and IT implementation costs. Capital expenditures accounted for approximately 3% of total revenue in the first nine months of 2022 as compared to approximately 4% of total revenue during the same period in 2021.
31
FRESENIUS MEDICAL CARE AG & Co. KGaA
Investments in the first nine months of 2022 were primarily comprised of purchases of debt securities and equity investments. Divestitures in the first nine months of 2022 were mainly related to the divestment of debt securities and equity investments. Acquisitions in the first nine months of 2022 related primarily to the purchase of dialysis clinics. Additionally, purchases of intangible assets for the first nine months of 2022 related primarily to emission rights certificates.
Investments in the first nine months of 2021 were primarily comprised of purchases of equity investments and debt securities. Divestitures in the first nine months of 2021 were mainly related to the divestment of debt securities. Acquisitions in the first nine months of 2021 related primarily to the purchase of dialysis clinics.
In 2022, we anticipate capital expenditures of €0.8 to €1.0 billion and expect to make acquisitions and investments, excluding investments in debt securities, of approximately €0.1 to €0.3 billion.
32
FRESENIUS MEDICAL CARE AG & Co. KGaA
Net cash provided by (used in) financing activities
In the first nine months of 2022, net cash used in financing activities was €1,497 M as compared to net cash used in financing activities of €667 M in the first nine months of 2021.
In the first nine months of 2022, cash was mainly used in the repayment of short-term debt (including borrowings under our commercial paper program and short-term debt from related parties), the repayment of long-term debt (including the repayment at maturity of bonds in an aggregate principal amount of $700 M (€533 M as of the date of issuance) on January 31, 2022), the repayment of lease liabilities (including lease liabilities from related parties), the payment of dividends and distributions to noncontrolling interests, partially offset by proceeds from long-term debt (including proceeds from the issuance of bonds in an aggregate principal amount of €750 M on September 20, 2022, and the issuance of Schuldschein loans of €225 M in February 2022) and proceeds from short-term debt (including borrowings under our commercial paper program and short-term debt from related parties). For further information, see note 7 of the notes to the consolidated financial statements (unaudited) included in this report.
In the first nine months of 2021, cash was mainly used in the repayment of long-term debt (including the repayment at maturity of bonds in an aggregate principal amount of $650 M (€473 M as of the date of issuance) and €300 M as well as the early repayment of the USD term loan 2017 / 2022 in the amount of $1,050 M (€860 M as of the date of repayment) and EUR term loan 2017 / 2022 in the amount of €245 M, both under our prior Amended 2012 Credit Agreement), the repayment of lease liabilities (including lease liabilities from related parties), repayments of short-term debt from unrelated parties, payment of dividends and distributions to noncontrolling interests, partially offset by proceeds from short-term debt (including borrowings under our commercial paper program) and proceeds from long-term debt (including proceeds from the issuance of bonds in an aggregate principal amount of $1,500 M (€1,227 M)).
On May 17, 2022, we paid a dividend with respect to 2021 of €1.35 per share (for 2020 paid in 2021 €1.34 per share). The total dividend payment was €396 M as compared to €392 M in the prior year.
Balance sheet structure
Total assets as of September 30, 2022 increased by 12% to €38.4 billion as compared to €34.4 billion at December 31, 2021. In addition to a 12% positive impact resulting from foreign currency translation, total assets remained stable at €34.3 billion as compared to €34.4 billion at December 31, 2021 as decreases in cash and cash equivalents, right-of-use assets and property, plant and equipment, were mostly offset by an increase in goodwill, primarily from the InterWell Health business combination, and inventories.
Current assets as a percent of total assets decreased to 22% at September 30, 2022 as compared to 23% at December 31, 2021, primarily driven by a decrease in cash and cash equivalents and an increase in non-current assets mainly due to increased goodwill (including goodwill recognized as part of the InterWell Health business combination), partially offset by an increase in trade accounts receivable and inventories. The equity ratio, the ratio of our equity divided by total liabilities and shareholders’ equity, increased to 44% at September 30, 2022 as compared to 41% at December 31, 2021, primarily driven by an increase in equity from currency translation as well as a decrease in short-term debt and pension liabilities, partially offset by an increase in provisions and other liabilities, including an increase in put option liabilities due to the InterWell Health business combination, and long term debt (including the current portion). ROIC decreased to 3.6% at September 30, 2022 as compared to 4.9% at December 31, 2021. For further information on ROIC, see “II. Discussion of measures – Non–IFRS measures – Return on invested capital (ROIC) (Non-IFRS Measure)” above.
Report on post-balance sheet date events
Refer to note 14 in the notes to the consolidated financial statements (unaudited) included in this report.
Recently issued accounting standards
Refer to note 1 of the notes to the consolidated financial statements (unaudited) included in this report for information regarding recently issued accounting standards.
33
FRESENIUS MEDICAL CARE AG & Co. KGaA
Interim Financial Statements
Consolidated statements of income
(unaudited)
Consolidated statements of income
in € thousands (“THOUS”), except per share data
For the three months | For the nine months | |||||||||
ended September 30, | ended September 30, | |||||||||
| Note |
| 2022 |
| 2021 |
| 2022 |
| 2021 | |
Revenue: | ||||||||||
Health care services |
| 3a | 4,082,400 | 3,529,609 | 11,471,127 | 10,255,289 | ||||
Health care products |
| 3a | 1,013,766 | 911,757 | 2,930,088 | 2,716,372 | ||||
| 5,096,166 | 4,441,366 | 14,401,215 | 12,971,661 | ||||||
Costs of revenue: |
| |||||||||
Health care services |
| 3,152,753 | 2,697,639 | 8,806,204 | 7,844,690 | |||||
Health care products |
| 584,826 | 476,510 | 1,632,279 | 1,369,104 | |||||
3,737,579 | 3,174,149 | 10,438,483 | 9,213,794 | |||||||
Gross profit |
| 1,358,587 | 1,267,217 | 3,962,732 | 3,757,867 | |||||
Operating (income) expenses: |
| |||||||||
Selling, general and administrative |
| 989,607 | 731,230 | 2,830,337 | 2,272,922 | |||||
Research and development |
| 3b | 61,484 | 52,362 | 166,575 | 153,024 | ||||
Income from equity method investees |
| 13 | (17,448) | (21,036) | (47,302) | (71,214) | ||||
Remeasurement Gain From InterWell Health | 2 | (146,699) | — | (146,699) | — | |||||
Operating income |
| 471,643 | 504,661 | 1,159,821 | 1,403,135 | |||||
Other (income) expense: |
| |||||||||
Interest income |
| (16,050) | (15,590) | (42,909) | (44,811) | |||||
Interest expense |
| 92,535 | 84,026 | 260,070 | 258,528 | |||||
Income before income taxes |
| 395,158 | 436,225 | 942,660 | 1,189,418 | |||||
Income tax expense |
| 112,226 | 104,990 | 241,917 | 274,131 | |||||
Net income |
| 282,932 | 331,235 | 700,743 | 915,287 | |||||
Net income attributable to noncontrolling interests |
| 52,832 | 58,191 | 166,142 | 174,720 | |||||
Net income attributable to shareholders of FMC AG & Co. KGaA |
| 230,100 | 273,044 | 534,601 | 740,567 | |||||
Basic earnings per share |
| 3c | 0.78 | 0.93 | 1.82 | 2.53 | ||||
Diluted earnings per share |
| 3c | 0.78 | 0.93 | 1.82 | 2.53 | ||||
See accompanying notes to the unaudited interim consolidated financial statements.
34
FRESENIUS MEDICAL CARE AG & Co. KGaA
Consolidated statements of comprehensive income
(unaudited)
Consolidated statements of comprehensive income
in € THOUS
For the three months | For the nine months | |||||||
ended September 30, | ended September 30, | |||||||
| 2022 |
| 2021 |
| 2022 |
| 2021 | |
Net income | 282,932 | 331,235 | 700,743 | 915,287 | ||||
Other comprehensive income (loss): | ||||||||
Components that will not be reclassified to profit or loss: | ||||||||
Equity method investees - share of OCI | 34,785 | 3,870 | 22,849 | (45,384) | ||||
FVOCI equity investments | 11 | 18,391 | 8,687 | 43,684 | ||||
Actuarial gain (loss) on defined benefit pension plans | 50,958 | 952 | 291,257 | 50,726 | ||||
Income tax (expense) benefit related to components of other comprehensive income not reclassified | (15,271) | (5,247) | (87,590) | (27,207) | ||||
70,483 | 17,966 | 235,203 | 21,819 | |||||
Components that may be reclassified subsequently to profit or loss: | ||||||||
Gain (loss) related to foreign currency translation | 913,140 | 332,987 | 2,237,453 | 737,174 | ||||
FVOCI debt securities | (13,318) | (1,542) | (46,698) | (8,610) | ||||
Gain (loss) related to cash flow hedges | 1,320 | 801 | 884 | (378) | ||||
Cost of hedging | (1,354) | 128 | 94 | (7) | ||||
Income tax (expense) benefit related to components of other comprehensive income that may be reclassified | 2,459 | 14 | 8,149 | 1,546 | ||||
902,247 | 332,388 | 2,199,882 | 729,725 | |||||
Other comprehensive income (loss), net of tax | 972,730 | 350,354 | 2,435,085 | 751,544 | ||||
Total comprehensive income | 1,255,662 | 681,589 | 3,135,828 | 1,666,831 | ||||
Comprehensive income attributable to noncontrolling interests | 141,151 | 86,609 | 362,366 | 237,620 | ||||
Comprehensive income (loss) attributable to shareholders of FMC AG & Co. KGaA | 1,114,511 | 594,980 | 2,773,462 | 1,429,211 | ||||
See accompanying notes to the unaudited interim consolidated financial statements.
35
FRESENIUS MEDICAL CARE AG & Co. KGaA
Consolidated balance sheets
(unaudited)
Consolidated balance sheets
in € THOUS, except share data
| Note |
| September 30, 2022 |
| December 31, 2021 | |
Assets | ||||||
Cash and cash equivalents |
|
| 1,113,552 | 1,481,655 | ||
Trade accounts and other receivables from unrelated parties |
|
| 3,815,374 | 3,409,061 | ||
Accounts receivable from related parties |
| 4 |
| 156,789 | 162,361 | |
Inventories |
| 5 |
| 2,409,683 | 2,038,014 | |
Other current assets |
| 1,017,270 | 876,151 | |||
Total current assets |
| 8,512,668 | 7,967,242 | |||
Property, plant and equipment |
| 4,524,470 | 4,235,027 | |||
Right-of-use assets |
|
| 4,570,866 | 4,316,440 | ||
Intangible assets | 2 |
| 1,603,802 | 1,459,393 | ||
Goodwill |
| 17,187,107 | 14,361,577 | |||
Deferred taxes |
| 328,137 | 315,360 | |||
Investment in equity method investees |
| 13 |
| 767,699 | 786,905 | |
Other non-current assets |
| 911,686 | 924,614 | |||
Total non-current assets |
| 29,893,767 | 26,399,316 | |||
Total assets |
| 38,406,435 | 34,366,558 | |||
Liabilities |
| |||||
Accounts payable to unrelated parties |
| 828,090 | 736,069 | |||
Accounts payable to related parties |
| 4 |
| 80,829 | 121,457 | |
Current provisions and other current liabilities |
| 3,878,425 | 3,676,875 | |||
Short-term debt from unrelated parties |
| 6 |
| 543,523 | 1,178,353 | |
Short-term debt from related parties |
| 6 |
| 39,000 | 77,500 | |
Current portion of long-term debt |
| 7 |
| 58,485 | 667,966 | |
Current portion of lease liabilities from unrelated parties |
|
| 709,726 | 639,947 | ||
Current portion of lease liabilities from related parties |
| 4 |
| 22,115 | 21,631 | |
Income tax liabilities |
| 197,193 | 137,836 | |||
Total current liabilities |
| 6,357,386 | 7,257,634 | |||
Long-term debt, less current portion |
| 7 |
| 8,068,492 | 6,646,949 | |
Lease liabilities from unrelated parties, less current portion |
|
| 4,261,494 | 3,990,153 | ||
Lease liabilities from related parties, less current portion |
| 4 |
| 82,707 | 97,650 | |
Non-current provisions and other non-current liabilities |
| 1,319,778 | 707,563 | |||
Pension liabilities | 8 |
| 541,127 | 782,622 | ||
Income tax liabilities |
| 45,270 | 36,498 | |||
Deferred taxes |
| 994,803 | 868,452 | |||
Total non-current liabilities |
| 15,313,671 | 13,129,887 | |||
Total liabilities |
| 21,671,057 | 20,387,521 | |||
Shareholders’ equity: |
|
| ||||
Ordinary shares, no par value, €1.00 nominal value, 362,370,124 shares authorized, 293,413,449 and as of September 30, 2022 (December 31, 2021: 293,004,339) |
| 293,413 | 293,004 | |||
Additional paid-in capital |
| 3,360,748 | 2,891,276 | |||
Retained earnings |
| 10,478,492 | 10,826,140 | |||
Accumulated other comprehensive income (loss) |
| 918,768 | (1,311,637) | |||
Total FMC AG & Co. KGaA shareholders’ equity |
| 15,051,421 | 12,698,783 | |||
Noncontrolling interests |
| 1,683,957 | 1,280,254 | |||
Total equity |
| 16,735,378 | 13,979,037 | |||
Total liabilities and equity |
| 38,406,435 | 34,366,558 |
See accompanying notes to the unaudited interim consolidated financial statements.
36
FRESENIUS MEDICAL CARE AG & Co. KGaA
Consolidated statements of cash flows
(unaudited)
Consolidated statements of cash flows
in € THOUS
For the nine months ended | ||||||
September 30, | ||||||
| Note |
| 2022 |
| 2021 | |
Operating activities | ||||||
Net income | 700,743 | 915,287 | ||||
Adjustments to reconcile net income to net cash provided by operating activities: |
| |||||
Depreciation, amortization and impairment loss |
| 13 | 1,343,690 | 1,186,568 | ||
Change in deferred taxes, net |
| (60,080) | (12,828) | |||
(Gain) loss from the sale of fixed assets, right-of-use assets, investments and divestitures |
| (66,511) | (25,845) | |||
Income from equity method investees |
| 13 | (47,302) | (71,214) | ||
Interest expense, net |
| 217,161 | 213,717 | |||
Changes in assets and liabilities, net of amounts from businesses acquired: |
| |||||
Trade accounts and other receivables from unrelated parties |
| (68,581) | (60,469) | |||
Inventories |
| (169,075) | (153,642) | |||
Other current and non-current assets |
| (20,061) | 131,972 | |||
Accounts receivable from related parties |
| 25,659 | (29,410) | |||
Accounts payable to related parties |
| (52,270) | (5,740) | |||
Accounts payable to unrelated parties, provisions and other current and non-current liabilities |
| (191,476) | (132,830) | |||
Income tax liabilities |
| 291,631 | 285,759 | |||
Received dividends from investments in equity method investees | 94,545 | 57,680 | ||||
Paid interest |
| (238,716) | (255,162) | |||
Received interest |
| 42,121 | 44,718 | |||
Paid income taxes |
| (233,758) | (268,110) | |||
Net cash provided by (used in) operating activities |
| 1,567,720 | 1,820,451 | |||
Investing activities |
| |||||
Purchases of property, plant and equipment and capitalized development costs |
| (494,604) | (588,198) | |||
Acquisitions, net of cash acquired, investments and purchases of intangible assets |
| (39,901) | (270,580) | |||
Investments in debt securities | (92,131) | (62,640) | ||||
Proceeds from sale of property, plant and equipment |
| 8,805 | 26,964 | |||
Proceeds from divestitures |
| 56,459 | 2,565 | |||
Proceeds from sale of debt securities | 51,592 | 118,451 | ||||
Net cash provided by (used in) investing activities |
| (509,780) | (773,438) | |||
Financing activities |
| |||||
Proceeds from short-term debt from unrelated parties |
| 576,745 | 1,722,084 | |||
Repayments of short-term debt from unrelated parties |
| (1,223,028) | (462,529) | |||
Proceeds from short-term debt from related parties |
| 84,000 | 49,446 | |||
Repayments of short-term debt from related parties |
| (122,500) | (26,766) | |||
Proceeds from long-term debt |
| 1,026,685 | 1,231,756 | |||
Repayments of long-term debt |
| (761,495) | (2,067,228) | |||
Repayments of lease liabilities from unrelated parties |
| (556,965) | (502,679) | |||
Repayments of lease liabilities from related parties |
| (16,533) | (15,487) | |||
Increase (decrease) of accounts receivable facility |
| 23,500 | — | |||
Proceeds from exercise of stock options |
| 20,151 | 6,005 | |||
Dividends paid | (395,556) | (392,455) | ||||
Distributions to noncontrolling interests |
| (218,068) | (250,185) | |||
Contributions from noncontrolling interests |
| 65,620 | 41,189 | |||
Net cash provided by (used in) financing activities |
| (1,497,444) | (666,849) | |||
Effect of exchange rate changes on cash and cash equivalents |
| 71,401 | 100,131 | |||
Cash and cash equivalents: |
| |||||
Net increase (decrease) in cash and cash equivalents |
| (368,103) | 480,295 | |||
Cash and cash equivalents at beginning of period |
| 1,481,655 | 1,081,539 | |||
Cash and cash equivalents at end of period |
| 1,113,552 | 1,561,834 | |||
See accompanying notes to the unaudited interim consolidated financial statements.
37
FRESENIUS MEDICAL CARE AG & Co. KGaA
Consolidated statements of shareholders´ equity
For the nine months ended September 30, 2022 and 2021 (unaudited)
Consolidated statements of shareholders’ equity
in € THOUS, except share data
| Ordinary shares |
| Accumulated other comprehensive income (loss) | |||||||||||||||||||||
Total FMC AG | ||||||||||||||||||||||||
Additional | Foreign | & Co. KGaA | ||||||||||||||||||||||
Number of | No par | paid in | Retained | currency | Cash flow | Fair value | shareholders’ | Non-controlling | ||||||||||||||||
| Note |
| shares |
| value |
| capital |
| earnings |
| translation |
| hedges |
| Pensions |
| changes |
| equity |
| interests |
| Total equity | |
Balance at December 31, 2020 | 292,876,570 | 292,877 | 2,872,630 | 10,254,913 | (1,936,713) | (7,706) | (346,282) | 85,361 | 11,215,080 | 1,116,230 | 12,331,310 | |||||||||||||
Proceeds from exercise of options and related tax effects | 117,639 | 117 | 5,308 | — | — | — | — | — | 5,425 | — | 5,425 | |||||||||||||
Dividends paid | — | — | — | (392,455) | — | — | — | — | (392,455) | — | (392,455) | |||||||||||||
Purchase/ sale of noncontrolling interests | — | — | 7,024 | — | — | — | — | — | 7,024 | 55,854 | 62,878 | |||||||||||||
Contributions from/ to noncontrolling interests | — | — | — | — | — | — | — | — | — | (193,466) | (193,466) | |||||||||||||
Put option liabilities |
| 12 | — | — | — | (34,605) | — | — | — | — | (34,605) | — | (34,605) | |||||||||||
Transfer of cumulative gains/losses of equity investments | — | — | — | (721) | — | — | — | 721 | — | — | — | |||||||||||||
Net Income |
| — | — | — | 740,567 | — | — | — | — | 740,567 | 174,720 | 915,287 | ||||||||||||
Other comprehensive income (loss) related to: |
| |||||||||||||||||||||||
Foreign currency translation |
| — | — | — | — | 681,051 | (459) | (8,466) | 2,148 | 674,274 | 62,900 | 737,174 | ||||||||||||
Cash flow hedges, net of related tax effects |
| — | — | — | — | — | (234) | — | — | (234) | — | (234) | ||||||||||||
Pensions, net of related tax effects | — | — | — | — | — | — | 36,236 | — | 36,236 | — | 36,236 | |||||||||||||
Fair value changes | — | — | — | — | — | — | — | (21,632) | (21,632) | — | (21,632) | |||||||||||||
Comprehensive income |
| — | — | — | — | — | — | — | — | 1,429,211 | 237,620 | 1,666,831 | ||||||||||||
Balance at September 30, 2021 |
| 292,994,209 | 292,994 | 2,884,962 | 10,567,699 | (1,255,662) | (8,399) | (318,512) | 66,598 | 12,229,680 | 1,216,238 | 13,445,918 | ||||||||||||
Balance at December 31, 2021 |
| 293,004,339 | 293,004 | 2,891,276 | 10,826,140 | (982,506) | (9,115) | (369,998) | 49,982 | 12,698,783 | 1,280,254 | 13,979,037 | ||||||||||||
Proceeds from exercise of options and related tax effects |
| 409,110 | 409 | 19,994 | — | — | — | — | — | 20,403 | — | 20,403 | ||||||||||||
Dividends paid | — | — | — | (395,556) | — | — | — | — | (395,556) | — | (395,556) | |||||||||||||
Transactions with noncontrolling interests without loss of control | 2 | — | — | 449,478 | — | — | — | — | — | 449,478 | 41,707 | 491,185 | ||||||||||||
Noncontrolling interests due to changes in consolidation group | 2 | — | — | — | — | — | — | — | — | — | 192,196 | 192,196 | ||||||||||||
Contributions from/ to noncontrolling interests | — | — | — | — | — | — | — | — | — | (192,566) | (192,566) | |||||||||||||
Put option liabilities |
| 12 | — | — | — | (495,149) | — | — | — | — | (495,149) | — | (495,149) | |||||||||||
Transfer of cumulative gains/losses of equity investments | — | — | — | 8,456 | — | — | — | (8,456) | — | — | — | |||||||||||||
Net Income |
| — | — | — | 534,601 | — | — | — | — | 534,601 | 166,142 | 700,743 | ||||||||||||
Other comprehensive income (loss) related to: |
| |||||||||||||||||||||||
Foreign currency translation |
| — | — | — | — | 2,064,227 | (1,193) | (24,856) | 3,051 | 2,041,229 | 196,224 | 2,237,453 | ||||||||||||
Cash flow hedges, net of related tax effects |
| — | — | — | — | — | 799 | — | — | 799 | — | 799 | ||||||||||||
Pensions, net of related tax effects | — | — | — | — | — | — | 203,898 | — | 203,898 | — | 203,898 | |||||||||||||
Fair value changes | — | — | — | — | — | — | — | (7,065) | (7,065) | — | (7,065) | |||||||||||||
Comprehensive income |
| — | — | — | — | — | — | — | — | 2,773,462 | 362,366 | 3,135,828 | ||||||||||||
Balance at September 30, 2022 |
| 293,413,449 | 293,413 | 3,360,748 | 10,478,492 | 1,081,721 | (9,509) | (190,956) | 37,512 | 15,051,421 | 1,683,957 | 16,735,378 | ||||||||||||
See accompanying notes to the unaudited interim consolidated financial statements.
38
FRESENIUS MEDICAL CARE AG & Co. KGaA
Notes to the interim consolidated financial statements
(unaudited)
(in THOUS, except share and per share data)
1. The Company and basis of presentation
The Company
Fresenius Medical Care AG & Co. KGaA (“FMC AG & Co. KGaA” or the “Company”), a German partnership limited by shares (Kommanditgesellschaft auf Aktien) registered in the commercial registry of Hof an der Saale under HRB 4019, with its business address at Else-Kröner-Str. 1, 61352 Bad Homburg v. d. Höhe, Germany, is the world’s leading provider of products and services for individuals with renal diseases, based on publicly reported revenue and number of patients treated. The Company provides dialysis care and related services to persons who suffer from End-Stage Kidney Disease (“ESKD”), as well as other health care services. The Company also develops, manufactures and distributes a wide variety of health care products. The Company’s health care products include hemodialysis machines, peritoneal dialysis cyclers, dialyzers, peritoneal dialysis solutions, hemodialysis concentrates, solutions and granulates, bloodlines, renal pharmaceuticals, systems for water treatment, and acute cardiopulmonary and apheresis products. The Company supplies dialysis clinics it owns, operates or manages with a broad range of products and also sells dialysis products to other dialysis service providers. The Company’s other health care services include value and risk-based care programs, pharmacy services, vascular, cardiovascular and endovascular specialty services as well as ambulatory surgery center services, physician nephrology and cardiology services and ambulant treatment services.
In these unaudited notes, “FMC AG & Co. KGaA,” the “Company” or the “Group” refers to Fresenius Medical Care AG & Co. KGaA or Fresenius Medical Care AG & Co. KGaA and its subsidiaries on a consolidated basis, as the context requires. “Fresenius SE” and “Fresenius SE & Co. KGaA” refer to Fresenius SE & Co. KGaA. “Management AG” and the “General Partner” refer to Fresenius Medical Care Management AG which is FMC AG & Co. KGaA’s general partner and is wholly owned by Fresenius SE. “Management Board” refers to the members of the management board of Management AG and, except as otherwise specified, “Supervisory Board” refers to the supervisory board of FMC AG & Co. KGaA. The term “North America Segment” refers to the North America operating segment, the term “EMEA Segment” refers to the Europe, Middle East and Africa operating segment, the term “Asia-Pacific Segment” refers to the Asia-Pacific operating segment, and the term “Latin America Segment” refers to the Latin America operating segment. For further discussion of the Company’s operating and reportable segments, see note 13.
Basis of presentation
The consolidated financial statements and other financial information included in the Company’s quarterly reports furnished under cover of Form 6-K and its Annual Report on Form 20-F are prepared solely in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”), using the euro as the Company’s reporting and functional currency.
The interim financial report is prepared in accordance with International Accounting Standard (“IAS”) 34, Interim Financial Reporting, and contains condensed financial statements, in that it does not include all of the notes that would be required in a complete set of financial statements, but rather selected explanatory notes. However, the primary financial statements are presented in the format consistent with the consolidated financial statements as presented in the Company’s Annual Report on Form 20-F for the year ended December 31, 2021 (the “2021 Form 20-F”) in accordance with IAS 1, Presentation of Financial Statements. During the first quarter of 2022, the Company adopted an accounting policy in relation to emission certificates which are recognized as intangible assets with an infinite useful life and initially measured at cost. During the third quarter of 2022, in the consolidated statements of shareholders’ equity, the Company started presenting transactions with noncontrolling interests without a loss of control separately from changes in noncontrolling interests due to changes in the consolidation group primarily related to an increase in noncontrolling interests resulting from the business combination completed among Fresenius Health Partners, Inc., InterWell Health LLC, and Cricket Health, Inc. (for further information on this business combination, see note 2). Previously, these changes in noncontrolling interests were combined within the line item "Purchase/ sale of noncontrolling interests" due to immateriality.
The interim consolidated financial statements at September 30, 2022 and for the three- and nine- months ended September 30, 2022 and 2021 contained in this report are unaudited and should be read in conjunction with the consolidated financial statements contained in the Company’s 2021 Form 20-F. The preparation of interim consolidated financial statements in conformity with IFRS requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Such interim financial statements reflect all adjustments that, in the opinion of management, are necessary for a fair presentation of the results of the periods presented. All such adjustments are of a normal recurring nature.
39
FRESENIUS MEDICAL CARE AG & Co. KGaA
Notes to the interim consolidated financial statements
(unaudited)
(in THOUS, except share and per share data)
The Company applies IAS 29, Financial Reporting in Hyperinflationary Economies (“IAS 29”), in its Argentine, Lebanese and Turkish subsidiaries due to inflation in these countries. The table below details the date of initial application of IAS 29 and the specific inputs used to calculate the loss on net monetary position on a country-specific basis for the nine months ended September 30, 2022. The hyperinflationary accounting effects of the initial application on the opening balance sheet are presented within accumulated other comprehensive income (loss) related to foreign currency translation, in the amount of €23,514, and ongoing re-translation effects of comparative amounts are recorded in other comprehensive income (loss) within the Company’s interim consolidated financial statements.
Inputs for the calculation of losses on net monetary positions
The effective tax rates of 28.4% and 25.7% for the three and nine months ended September 30, 2022, respectively (24.1% and 23.0% for the three and nine months ended September 30, 2021, respectively), are recognized on the basis of the best estimate made for the weighted average annual income tax rate expected for the full year and applied to income before income taxes reported in the interim financial statements.
The results of operations for the three and nine months ended September 30, 2022 are not necessarily indicative of the results of operations for the year ending December 31, 2022.
At the end of February 2022, Russia invaded Ukraine, triggering sanctions by various countries against Russia. The resulting uncertainties led to a further deterioration in the macroeconomic environment for the first nine months of 2022, resulting in accelerating inflationary developments, supply chain disruptions and capital market volatility. These developments, combined with complications in the labor market in the United States (“U.S.”), created pressure on the Company’s operations. The Company continues to monitor the situation. As of September 30, 2022, the Company’s assets in Russia and Ukraine totaled less than 1.5% of the Company’s total assets.
The market capitalization of the Company decreased by 49% to €8,500,188 at September 30, 2022 (December 31, 2021: €16,742,268). Total equity of the Company increased by 20% to €16,735,378 at September 30, 2022 (December 31, 2021: €13,979,037), driven primarily by foreign currency translation effects in the amount of €2,237,453.
In consideration of this situation, the world-wide prevailing increase of interest rates and the uncertainty regarding the macroeconomic environment noted above, the Company reviewed the impacts on its 2021 goodwill impairment test performed as of December 31, 2021. During the third quarter of 2022, the Company compared the carrying amounts of certain cash generating units (“CGUs”), EMEA and North America, to the respective CGU’s value in use, using the free cash flows of the CGUs considered in the impairment tests as of December 31, 2021, which were considerably above the carrying amounts of the respective CGUs, as a basis for evaluation. In its evaluation, the Company performed qualitative and quantitative scenario-based assessments. Based on the Company’s analysis, the impacts noted above were reflected in probability-weighted free cash flow projections with operating income margin as a key valuation parameter and in two different (pre-tax and after-tax discount rates) scenarios.
The updated pre-tax discount rates used are 6.4% and 6.9% (2021: 5.8%) for North America and 8.1% and 8.5% (2021: 7.1%) for EMEA and the after-tax discount rates are 5.0% and 5.4% (2021: 4.6%) for North America and 5.9% and 6.2% (2021: 5.2%) for EMEA. For a detailed description of the procedure and other, consistently applied key assumptions and ranges to perform impairment tests, see notes 1 g) and 2 a) of the consolidated financial statements contained in the 2021 Form 20-F. The assessment did not result in any indication of impairment as of September 30, 2022. Management continues to monitor the situation.
Based on the assessment performed, the sensitivity analyses for the cash generating units North America and EMEA showed that without considering any growth, improvement and recovery projects compared to the status quo for the first three years, an impairment loss would not be required to be recognized even if the after-tax discount rate (North America 5.0% (2021: 4.6%) and EMEA 5.9% (2021: 5.2%)) were to increase by 30% in North America and by 10% in EMEA.
40
FRESENIUS MEDICAL CARE AG & Co. KGaA
Notes to the interim consolidated financial statements
(unaudited)
(in THOUS, except share and per share data)
Furthermore, without considering any growth, improvement and recovery projects compared to the status quo for the first three years, the operating income margin of each projection year would need to decline by 2.81 percentage points (2021: decline by 5.22 percentage points) for North America and need to decline by 0.97 percentage points (2021: decline by 3.49 percentage points) for EMEA in order for the recoverable amount (value in use) to equal the carrying amount.
Goodwill as of September 30, 2022 was €17,187,107 (December 31, 2021: €14,361,577), thereof €14,929,506 (December 31, 2021: €12,223,884) in North America and €1,466,123 (December 31, 2021: €1,376,542) in EMEA.
On October 31, 2022, the Management Board authorized the issuance of the Company’s unaudited interim consolidated financial statements.
New accounting pronouncements
Recently implemented accounting pronouncements
The Company has prepared its interim consolidated financial statements at and for the nine months ended September 30, 2022 in conformity with IFRS that have to be applied for the interim periods starting on or after January 1, 2022. In the nine months ended September 30, 2022, there were no recently implemented accounting pronouncements that had a material effect on the Company’s interim consolidated financial statements.
Recent accounting pronouncements not yet adopted
The IASB issued the following new standard which is relevant for the Company:
IFRS 17, Insurance Contracts
In May 2017, the IASB issued IFRS 17, Insurance Contracts. In June 2020 and December 2021, further amendments were published. IFRS 17 establishes principles for the recognition, measurement, presentation and disclosure related to the issuance of insurance contracts. IFRS 17 replaces IFRS 4, Insurance Contracts, which was brought in as an interim standard in 2004. IFRS 4 permitted the use of national accounting standards for the accounting of insurance contracts under IFRS. As a result of the varied application for insurance contracts there was a lack of comparability among peer groups. IFRS 17 eliminates this diversity in practice by requiring all insurance contracts to be accounted for using updated estimates and assumptions that reflect the timing of cash flows and any uncertainty relating to insurance contracts.
Based on an assessment performed during 2022, the Company believes that the premium allocation approach under IFRS 17 is the most appropriate measurement model. On initial recognition of the liability for incurred claims, the estimation and valuation process remains unchanged as compared to the application of IFRS 4. Regarding the measurement of the liability for the remaining coverage, the liability is equal to the premiums received less any insurance acquisition cash flows. The Company does not consider the effects and time value of money when measuring the liability for the remaining coverage, as the related cash flow are expected to be paid or received in one year or less from the date the claims are incurred. The Company will apply the modified retrospective approach at the transition. Insurance premium revenues are currently recognized based on the passage of time, therefore the pattern of revenue recognition will not change upon the application of IFRS 17.
The Company does not expect that IFRS 17 will have a material impact on its consolidated financial statements and will continue to assess the qualitative and quantitative impacts of the application of IFRS 17. On June 25, 2020, the IASB issued amendments to IFRS 17, which among others, defer the effective date to fiscal years beginning on or after January 1, 2023. Earlier adoption is permitted for entities that have also adopted IFRS 9, Financial Instruments and IFRS 15, Revenue from Contracts with Customers.
In the Company’s view, no other pronouncements issued by the IASB are expected to have a material impact on the consolidated financial statements.
41
FRESENIUS MEDICAL CARE AG & Co. KGaA
Notes to the interim consolidated financial statements
(unaudited)
(in THOUS, except share and per share data)
2. Acquisitions, investments (including debt securities) and purchases of intangible assets
The Company completed acquisitions, investments (including debt securities) and the purchase of intangible assets in the amount of €135,736 and €365,536 for the nine months ended September 30, 2022 and 2021, respectively.
Additionally, on August 24, 2022 (“Acquisition Date”), the Company completed a business combination among Fresenius Health Partners, Inc. (“FHP”), the value-based care division of the Company’s wholly-owned subsidiary Fresenius Medical Care Holdings, Inc., with InterWell Health LLC, a physician organization driving innovation in the kidney care space in the U.S., and Cricket Health, Inc. (“Cricket”), a U.S. provider of value-based kidney care with a patient engagement and data platform. The transaction was completed after regulatory approval was received in the U.S. and other customary closing conditions were satisfied. Upon completion of the transactions with noncontrolling shareholders and consummation of the business combination described below, the Company held approximately 75% of the new company. The new company, InterWell Topco L.P. (“NewCo”), will operate under the InterWell Health brand and will target the management of care for more than 270,000 people with kidney disease.
Under the terms and conditions of this business combination, Cricket Health, Inc. contributed all of its net assets in exchange for approximately 17% of the equity interest in NewCo. The fair value of the consideration transferred by the Company to Cricket Health, Inc. for a controlling interest in NewCo was $269,318 (€271,107 as of the Acquisition Date).
InterWell Health LLC also contributed all of its net assets in exchange for approximately 8% of the equity interest in NewCo. The fair value of the consideration transferred by the Company to InterWell Health LLC for a controlling interest in Newco was $136,768 (€137,677 as of the Acquisition Date). Prior to the transaction, the Company owned approximately 46% of InterWell Health LLC with a carrying value of $19,370 (€19,499) and a fair value of $175,434 (€176,600) as of the Acquisition Date. At the Acquisition Date, the Company received approximately 7% equity in NewCo in exchange for its investment in InterWell Health, LLC. As a result of the transaction, the Company recognized a remeasurement gain of $156,064 (€146,699) for the nine months ended September 30, 2022, which represented the difference between the fair value and the carrying value of its investment in InterWell Health LLC prior to the Acquisition Date, and a related currency translation adjustment reversal due to the disposal of its investment in Interwell Health LLC in the amount of €364 for the nine months ended September 30, 2022. The remeasurement gain is recorded in the consolidated statements of income for the three- and nine-months ended September 30, 2022 within the line item “Remeasurement Gain From InterWell Health”.
The contributions of the net assets of InterWell Health LLC and Cricket Health, Inc. were accounted for as a business combination in accordance with IFRS 3 in which the Company was identified as the acquirer and InterWell Health LLC and Cricket Health, Inc. were identified as acquired companies. NewCo has been consolidated in the Company’s consolidated financial statements as of and for the reporting period ending September 30, 2022.
The Company also contributed the business of FHP in exchange for approximately 68% of equity interest in NewCo. Since the Company controlled FHP before the Acquisition Date and controls NewCo post-Acquisition Date, the Company's contribution of FHP was accounted for as an equity transaction. Therefore, the net assets contributed were recorded at their respective carrying value at the Acquisition Date. Noncontrolling interest was recognized in the amount of $4,914 (€4,947 as of the Acquisition Date) and additional paid in capital of $401,188 (€403,854 as of the Acquisition Date) representing the difference between the carrying value and the fair value of the corresponding interests was recorded within the line item “Transactions with noncontrolling interests without loss of control” in the consolidated statements of shareholders’ equity.
As a result of the transaction, the Company recorded additional noncontrolling interests at fair value in the amount of $194,158 (€195,448 as of the Acquisition Date) using the full goodwill method within the line item “Noncontrolling interests due to changes in consolidation group” in the consolidated statements of shareholders’ equity. A third party valuation advisor was engaged to assist the Company in the estimation of the underlying fair value of the transaction and primarily employed an income approach which was used in the calculation of consideration transferred to the acquirees as well as in the calculation of noncontrolling interests. In addition, the Company also granted put options to noncontrolling shareholders with an estimated fair value of $577,308 (€592,232) at September 30, 2022 (as of Acquisition Date: $604,137 (€608,150)). For further information regarding the valuation of put option liabilities, see note 12.
42
FRESENIUS MEDICAL CARE AG & Co. KGaA
Notes to the interim consolidated financial statements
(unaudited)
(in THOUS, except share and per share data)
The following allocation of the purchase price is based upon information available to management as of September 30, 2022. Based on a preliminary allocation, the following assets, including goodwill (which will not be deductible for tax purposes), were acquired and liabilities were assumed as of the Acquisition Date:
Reconciliation of goodwill recognized
| in $ THOUS |
| in € THOUS | |
Fair value of consideration transferred | 406,086 | 408,784 | ||
Fair value of previously held equity method investment in InterWell Health LLC | 175,434 | 176,600 | ||
581,520 | 585,384 | |||
Fair Values of Assets Acquired and Liabilities Assumed (preliminary) | ||||
Less: Cash and cash equivalents | (57,383) | (57,764) | ||
Less: Other assets | (2,819) | (2,838) | ||
Less: Intangible assets | (34,519) | (34,748) | ||
Other liabilities | 13,029 | 13,116 | ||
Deferred tax liabilities | 9,084 | 9,144 | ||
Noncontrolling interests | 194,158 | 195,448 | ||
Goodwill | 703,070 | 707,742 |
The Company is in the process of obtaining and evaluating the information necessary for the purchase price allocations, including, but not limited to, working capital, tax-related items and the final capital interest allocation. As such, the balances noted in the table above are provisional and subject to measurement period adjustments permitted under IFRS 3. Any adjustments to acquisition accounting, net of related income tax effects, will be recorded with a corresponding adjustment to goodwill within one year from the Acquisition Date.
As of the Acquisition Date, amortizable intangible assets, primarily a technology platform, in the amount of $34,519 (€34,748) acquired in this transaction have weighted average useful lives of 12 years.
As of the Acquisition Date, goodwill in the amount of $703,070 (€707,742) was recorded as part of the transaction and mainly represents anticipated synergies and future cash flows expected to be generated by NewCo. The entire amount of goodwill recorded as a result of this transaction was allocated to the North America cash generating unit.
Additionally, and as contemplated in the agreement, the Company also transferred Acumen Physician Solutions, LLC (“Acumen”) to NewCo shortly after the Acquisition Date, and prior to September 30, 2022, with working capital in the amount of $1,824 (€1,845 as of the date of the transfer agreement). Since certain long-lived assets (mainly intangible assets) held by Acumen will be utilized materially differently by NewCo, management performed an impairment assessment prior to the transfer, concluded that the assets were completely impaired in accordance with IAS 36, Impairment of Assets, and recorded an impairment charge in the North America Segment in the amount of $71,025 before the transfer (€66,763 for the nine months ended September 30, 2022). The Company also incurred certain transaction-related costs of $25,352 (€23,831 for the nine months ended September 30, 2022). The expenses, along with the impairment charges were recognized in "Selling, general and administrative” expense on the consolidated statements of income. The transaction-related costs are included in operating activities and cash acquired is included in investing activities in the consolidated statements of cash flows.
From August 24, 2022 through September 30, 2022, the revenue contributed by the acquired companies (i.e. Cricket and InterWell Health, LLC) was not material. During this period, the Company recognized a loss of €3,765 from the acquired companies within its consolidated profit or loss. Had the business combination taken place on January 1, 2022, the Company estimates that its revenue for the nine months ended September 30, 2022 would not have been materially different. However, the Company estimates that net income for the nine months ended September 30, 2022 would have been €38,955 lower than reported if the business combination had taken place at the beginning of the reporting period.
43
FRESENIUS MEDICAL CARE AG & Co. KGaA
Notes to the interim consolidated financial statements
(unaudited)
(in THOUS, except share and per share data)
3. Notes to the consolidated statements of income
a) Revenue
The Company has recognized the following revenue in the consolidated statements of income for the three and nine months ended September 30, 2022 and 2021:
Revenue
in € THOUS
For the three months ended | ||||||||||||
September 30, | ||||||||||||
2022 | 2021 | |||||||||||
Revenue from | Revenue from | |||||||||||
| contracts with |
| Other |
| contracts with |
| Other | |||||
| customers |
| revenue |
| Total |
| customers |
| revenue |
| Total | |
Health care services | 3,973,255 | 109,145 | 4,082,400 | 3,424,066 | 105,543 | 3,529,609 | ||||||
Health care products |
| 989,256 | 24,510 | 1,013,766 | 889,217 | 22,540 | 911,757 | |||||
Total |
| 4,962,511 | 133,655 | 5,096,166 | 4,313,283 | 128,083 | 4,441,366 | |||||
For the nine months ended | ||||||||||||
September 30, | ||||||||||||
2022 | 2021 | |||||||||||
Revenue from | Revenue from | |||||||||||
contracts with | Other | contracts with | Other | |||||||||
| customers |
| revenue |
| Total |
| customers |
| revenue |
| Total | |
Health care services |
| 11,106,053 | 365,074 | 11,471,127 | 9,962,881 | 292,408 | 10,255,289 | |||||
Health care products |
| 2,850,964 | 79,124 | 2,930,088 | 2,629,629 | 86,743 | 2,716,372 | |||||
Total |
| 13,957,017 | 444,198 | 14,401,215 | 12,592,510 | 379,151 | 12,971,661 | |||||
b) Research and development expenses
Research and development expenses of €166,575 for the nine months ended September 30, 2022 (for the nine months ended September 30, 2021: €153,024) included research and non-capitalizable development costs as well as depreciation and amortization expenses related to capitalized development costs of €7,182 (for the nine months ended September 30, 2021: €4,380).
c) Earnings per share
The following table contains reconciliations of the numerators and denominators of the basic and diluted earnings per share computations for the three and nine months ended September 30, 2022 and 2021:
Reconciliation of basic and diluted earnings per share
in € THOUS, except share and per share data
44
FRESENIUS MEDICAL CARE AG & Co. KGaA
Notes to the interim consolidated financial statements
(unaudited)
(in THOUS, except share and per share data)
d) Impacts of severe acute respiratory syndrome coronavirus 2 (“COVID-19”)
The Company provides life-sustaining dialysis treatments and other critical health care services and products to patients. The Company’s patients need regular and frequent dialysis treatments, or else they face significant adverse health consequences that could result in hospitalization or death. To be able to continue care for its patients in light of COVID-19, the Company determined that it needed to implement a number of measures, both operational and financial, to maintain an adequate workforce, to protect its patients and employees through expanded personal protective equipment protocols and to develop surge capacity for patients suspected or confirmed to have COVID-19. Additionally, the Company experienced a loss of revenue due to the pandemic in certain parts of its business, partially offset by increased demand for its services and products in other parts. Various governments in regions in which the Company operates have provided economic assistance programs to address the consequences of the pandemic on companies and support health care providers and patients.
The Company recorded €275,355 and €20,416 for the nine months ended September 30, 2022 and 2021, respectively, within the statement of profit and loss for government grants in various regions in which it operates. In addition to the costs incurred which are eligible for government funding in various countries, the Company has been affected by impacts that COVID-19 had on the global economy and financial markets as well as effects related to lockdowns. During the nine months ended September 30, 2022, the Company received an additional $234,411 (€220,344) in U.S. Department of Health and Human Services funding available for health care providers affected by the COVID-19 pandemic.
The remaining amount of U.S. government grants received recorded in deferred income was $9,127 (€9,363) and $62,176 (€54,897) at September 30, 2022 and December 31, 2021, respectively. The Company also recorded a contract liability for advance payments received under the Center for Medicare and Medicaid (“CMS”) Accelerated and Advance Payment program which is currently recorded within current provisions and other current liabilities. Contract liabilities related to the CMS Accelerated and Advance Payment program were $15,925 (€16,336) and $442,568 (€390,754) as of September 30, 2022 and December 31, 2021, respectively.
4. Related party transactions
Fresenius SE is the Company’s largest shareholder and owns 32.2% of the Company’s outstanding shares at September 30, 2022. The Else Kröner-Fresenius-Stiftung is the sole shareholder of Fresenius Management SE, the general partner of Fresenius SE, and has sole power to elect the supervisory board of Fresenius Management SE. The Company has entered into certain arrangements for services and products with Fresenius SE or its subsidiaries and with certain of the Company’s equity method investees as described in item a) below. The arrangements for leases with Fresenius SE or its subsidiaries are described in item b) below. The Company’s terms related to the receivables or payables for these services, leases and products are generally consistent with the normal terms of the Company’s ordinary course of business transactions with unrelated parties and the Company believes that these arrangements reflect fair market terms. The Company utilizes various methods to verify the commercial reasonableness of its related party arrangements. Financing arrangements as described in item c) below have agreed-upon terms which are determined at the time such financing transactions occur and reflect market rates at the time of the transaction. The relationship between the Company and its key management personnel who are considered to be related parties is described in item d) below. The Company’s related party transactions are settled through Fresenius SE’s cash management system where appropriate.
a) Service agreements and products
The Company is party to service agreements with Fresenius SE and certain of its affiliates (collectively “Fresenius SE Companies”) to receive services, including, but not limited to: administrative services, management information services, employee benefit administration, insurance, information technology services, tax services and treasury management services. These related party agreements generally have a duration of 1 to 5 years and are renegotiated on an as needed basis when the agreement comes due. The Company also provides administrative services to one of its equity method investees.
The Company sells products to Fresenius SE Companies and purchases products from Fresenius SE Companies and equity method investees. In addition, Fresenius Medical Care Holdings, Inc. (“FMCH”) purchases heparin supplied by Fresenius Kabi USA, Inc. (“Kabi USA”), through an independent group purchasing organization (“GPO”). Kabi USA is an indirect, wholly-owned subsidiary of Fresenius SE. The Company has no direct supply agreement with Kabi USA and does not submit purchase orders directly to Kabi USA. FMCH acquires heparin from Kabi USA, through the GPO contract, which was negotiated by the GPO at arm’s length on behalf of all members of the GPO.
In December 2010, the Company and Galenica Ltd. (now known as CSL Vifor) formed the renal pharmaceutical company Vifor Fresenius Medical Care Renal Pharma Ltd., an equity method investee of which the Company owns 45%. The Company has entered into exclusive supply agreements to purchase certain pharmaceuticals from, as well as into certain exclusive distribution agreements with, Vifor Fresenius Medical Care Renal Pharma Ltd.
45
FRESENIUS MEDICAL CARE AG & Co. KGaA
Notes to the interim consolidated financial statements
(unaudited)
(in THOUS, except share and per share data)
Under the CMS Comprehensive End-Stage Renal Disease (“ESRD”) Care Model, the Company and participating physicians formed entities known as ESRD Seamless Care Organizations (“ESCOs”) as part of a payment and care delivery model that seeks to deliver better health outcomes for Medicare ESKD patients while lowering CMS’s costs. The Company entered into participation/service agreements with these ESCOs, which are accounted for as equity method investees. The Company anticipates that CMS will publish final settlement reports for the last performance year during the fourth quarter of 2022.
Below is a summary, including the Company’s receivables from and payables to the indicated parties, resulting from the above-described transactions with related parties.
Service agreements and products with related parties
in € THOUS
| (1) | In addition to the above shown accounts payable, accrued expenses for service agreements with related parties amounted to €20,479 and €12,911 at September 30, 2022 and December 31, 2021, respectively. |
b) Lease agreements
In addition to the above-mentioned product and service agreements, the Company is a party to real estate lease agreements with Fresenius SE Companies, which mainly include leases for the Company’s corporate headquarters in Bad Homburg, Germany, and production sites in Schweinfurt and St. Wendel, Germany. The leases have maturities up to the end of 2029.
Below is a summary resulting from the above described lease agreements with related parties.
Lease agreements with related parties
in € THOUS
| (1) | Short-term leases and expenses relating to variable lease payments as well as low value leases are exempted from balance sheet recognition. |
c) Financing
The Company receives short-term financing from and provides short-term financing to Fresenius SE. The Company also utilizes Fresenius SE’s cash management system for the settlement of certain intercompany receivables and payables with its subsidiaries and other related parties. As of September 30, 2022 and December 31, 2021, the Company had accounts receivable from Fresenius SE related to short-term financing in the amount of €2,020 and €14,900, respectively. As of September 30, 2022 and December 31, 2021, the Company did not have accounts payable to Fresenius SE related to short-term financing under Fresenius SE’s cash management system. The interest rates for these cash management arrangements are set on a daily basis and are based on the then-prevailing overnight reference rate, with a floor of zero, for the respective currencies.
46
FRESENIUS MEDICAL CARE AG & Co. KGaA
Notes to the interim consolidated financial statements
(unaudited)
(in THOUS, except share and per share data)
On August 19, 2009 and November 28, 2013, the Company borrowed €1,500 and €1,500, respectively, from the General Partner. The loan repayments were extended periodically and combined into a single borrowing during 2022. The loan repayment is currently due on April 21, 2027 with an interest rate of 1.3348%.
At September 30, 2022 and December 31, 2021, the Company borrowed from Fresenius SE in the amount of €36,000 at an interest rate of 1.292% and €74,500 at an interest rate of 0.600%, respectively. For further information on this loan agreement, see note 6.
d) Key management personnel
Due to the Company’s legal form of a German partnership limited by shares, the General Partner holds a key management position within the Company. In addition, as key management personnel, members of the Management Board and the Supervisory Board, as well as their close relatives, are considered related parties.
The Company’s Articles of Association provide that the General Partner shall be reimbursed for any and all expenses in connection with management of the Company’s business, including remuneration of the members of the General Partner’s supervisory board and the members of the Management Board. The aggregate amount reimbursed to the General Partner was €16,952 and €25,885 for its management services during the nine months ended September 30, 2022 and 2021, respectively. As of September 30, 2022 and December 31, 2021, the Company had accounts receivable from the General Partner in the amount of €513 and €769, respectively. As of September 30, 2022, the Company did have accounts payable to the General Partner. As of December 31, 2021, the Company had accounts payable to the General Partner in the amount of €24,265.
5. Inventories
At September 30, 2022 and December 31, 2021, inventories consisted of the following:
Inventories
in € THOUS
| September 30, | December 31, | ||
| 2022 |
| 2021 | |
Finished goods |
| 1,380,547 | 1,233,197 | |
Health care supplies |
| 576,618 | 452,073 | |
Raw materials and purchased components |
| 313,203 | 247,478 | |
Work in process |
| 139,315 | 105,266 | |
Inventories |
| 2,409,683 | 2,038,014 |
6. Short-term debt
At September 30, 2022 and December 31, 2021, short-term debt consisted of the following:
Short-term debt
in € THOUS
The Company and certain consolidated entities operate a multi-currency notional cash pooling management system. In this cash pooling management system, amounts in euro and other currencies are offset without being transferred to a specific cash pool account. The system is used for an efficient utilization of funds within the Company. The Company met the conditions to offset balances within this cash pool for reporting purposes. At September 30, 2022 and December 31, 2021, cash and borrowings under lines of credit in the amount of €113,635 and €116,538, respectively, were offset under this cash pooling management system. Before this offset, cash and cash equivalents as of September 30, 2022 was €1,227,187 (December 31, 2021: €1,598,193) and short-term debt from unrelated parties was €657,158 (December 31, 2021: €1,294,891).
47
FRESENIUS MEDICAL CARE AG & Co. KGaA
Notes to the interim consolidated financial statements
(unaudited)
(in THOUS, except share and per share data)
Commercial paper program
The Company maintains a commercial paper program under which short-term notes of up to €1,500,000 can be issued. At September 30, 2022, the outstanding commercial paper amounted to €412,000 (December 31, 2021: €715,000).
Short-term debt from related parties
The Company and FMCH were parties to an unsecured loan agreement, as borrowers, with Fresenius SE, as lender, under which the Company and FMCH could request and receive one or more short-term advances up to an aggregate amount of €600,000. In June 2022, the Company replaced its unsecured loan agreement with a new uncommitted revolving facility under which the Company, as borrower, may request and receive one or more short-term advances up to an aggregate amount of €600,000 with Fresenius SE, as lender. The uncommitted revolving facility is unsecured, does not have a termination date and is effective beginning August 1, 2022. For further information on short-term debt from related parties, see note 4 c).
7. Long-term debt
As of September 30, 2022 and December 31, 2021, long-term debt consisted of the following:
Long-term debt
in € THOUS
Schuldschein loans
On February 14, 2022, the Company issued €25,000 and €200,000 tranches of Schuldschein loans with maturities of 5 and 7 years, respectively, at variable interest rates. The proceeds were used for general corporate purposes including refinancing of existing liabilities.
Bonds
The bonds issued by Fresenius Medical Care US Finance II, Inc. in the amount of $700,000 (€532,522 as of the date of issuance on January 26, 2012) were redeemed at maturity on January 31, 2022.
On September 20, 2022, the Company issued bonds under its Debt Issuance Program in an aggregate principal amount of €750,000 with a maturity of 5 years and a coupon rate of 3.875%. The proceeds will be used for general corporate purposes, including the refinancing of outstanding indebtedness.
Accounts Receivable Facility
On August 11, 2021, the Company amended and restated its accounts receivable securitization program (“Accounts Receivable Facility”), extending it until August 11, 2024. The maximum capacity, $900,000 (€768,049 at August 11, 2021), remains unchanged under the restated Accounts Receivable Facility.
The following table shows the available and outstanding amounts under the Accounts Receivable Facility at September 30, 2022 and December 31, 2021:
48
FRESENIUS MEDICAL CARE AG & Co. KGaA
Notes to the interim consolidated financial statements
(unaudited)
(in THOUS, except share and per share data)
Accounts Receivable Facility - maximum amount available and balance outstanding
in THOUS
| Maximum amount available |
| Balance outstanding | |||||||||
September 30, 2022 (1) |
| September 30, 2022 (2) | ||||||||||
|
|
|
| |||||||||
Accounts Receivable Facility | $ | 900,000 | € | 923,266 | $ | 25,000 | € | 25,646 | ||||
| Maximum amount available |
| Balance outstanding | |||||||||
| December 31, 2021 (1) |
| December 31, 2021 (2) | |||||||||
|
|
|
| |||||||||
Accounts Receivable Facility | $ | 900,000 | € | 794,632 | $ | — | € | — | ||||
| (1) | Subject to availability of sufficient accounts receivable meeting funding criteria. |
| (2) | Amounts shown are excluding debt issuance costs. |
The Company also had letters of credit outstanding under the Accounts Receivable Facility in the amount of $12,532 and $12,532 (€12,856 and €11,065) at September 30, 2022 and December 31, 2021, respectively. These letters of credit are not included above as part of the balance outstanding at September 30, 2022 and December 31, 2021. However, the letters reduce available borrowings under the Accounts Receivable Facility.
Syndicated Credit Facility
The Company entered into a €2,000,000 sustainability-linked syndicated revolving credit facility (“Syndicated Credit Facility”) in July 2021. On June 8, 2022, the Company amended and extended the Syndicated Credit Facility to extend the term by one year and replace U.S. dollar-LIBOR as the reference rate with the Term Secured Overnight Financing Rate. The Syndicated Credit Facility, which serves as a back-up line for general corporate purposes, was undrawn as of September 30, 2022.
8. Employee benefit plans
Pension liabilities decreased by €241,495 to €541,127 at September 30, 2022 from €782,622 at December 31, 2021. The decrease is mainly attributable to adjustments to the discount rate, which resulted in an actuarial gain of the same amount to be recognized in other comprehensive income (loss). For the German benefit plan, which accounts for a substantial part of the pension liability, an interest rate of 4.20% was applied as of September 30, 2022 (December 31, 2021: 1.40%).
9. Capital management
As of September 30, 2022 and December 31, 2021 total equity in percent of total assets was 43.6% and 40.7%, respectively, and debt and lease liabilities in percent of total assets was 35.9% and 38.8%, respectively.
The Company’s financing structure and business model are reflected in the investment grade ratings. The Company is rated investment grade by Standard & Poor’s, Moody’s and Fitch.
Rating (1)
| Standard & Poor´s |
| Moody´s |
| Fitch | |
Corporate credit rating |
| BBB |
| Baa3 |
| BBB- |
Outlook |
| stable |
| stable |
| stable |
| (1) | A rating is not a recommendation to buy, sell or hold securities of the Company, and may be subject to suspension, change or withdrawal at any time by the assigning rating agency. |
10. Share-based plans
The FMC AG & Co. KGaA Long-Term Incentive Plan 2019 (“LTIP 2019”) expired on December 31, 2021. In order to continue to enable the members of the management boards of affiliated companies and managerial staff members to adequately participate in the long-term, sustained success of the Company, the Management Board has approved and adopted the FMC AG & Co. KGaA Long-Term Incentive Plan 2022+ (“LTIP 2022+”) as a successor program effective January 1, 2022.
49
FRESENIUS MEDICAL CARE AG & Co. KGaA
Notes to the interim consolidated financial statements
(unaudited)
(in THOUS, except share and per share data)
The LTIP 2022+ is a variable compensation program with a long-term incentive effect. Plan participants of the LTIP 2022+ can be allocated so-called "performance shares" once or twice a year. Performance shares are non-equity, cash-settled virtual compensation instruments which may entitle plan participants to receive a cash payment depending on the achievement of pre-defined performance targets further defined below as well as the Company’s share price development.
For LTIP 2022+ participants, the respective grant value is determined by the Management Board. In order to determine the number of performance shares each plan participant receives, their respective grant value will be divided by the value per performance share at the time of the allocation which is determined based on the average share price of the Company over a period of calendar days prior to the respective allocation date. For allocations in fiscal year 2022, the number of allocated performance shares may change over the performance period of three years, depending on the level of achievement of the following: (i) revenue growth at constant currency (“Revenue Growth”), (ii) net income growth at constant currency (net income attributable to the shareholders of FMC AG & Co. KGaA) (“Net Income Growth”) and (iii) return on invested capital (“ROIC”).
Revenue, net income and ROIC are determined according to the Company’s consolidated reported and audited figures in Euro for the consolidated financial statements prepared in accordance with the respective plan terms. Revenue Growth and Net Income Growth are determined at constant currency.
For allocations in fiscal year 2022, the target achievements of the performance targets Revenue Growth and Net Income Growth are calculated based on a Compound Annual Growth Rate ("CAGR") over the 3-year performance period. The basis for the first annual growth rate is 2021. Growth rates are calculated at constant currency. For ROIC, annual target values apply. For all three performance targets, the Management Board has defined target achievement corridors which will be used for the calculation of the respective target achievements.
The degree of target achievement for all three performance targets is weighted with for the purpose of determining the overall target achievement at the end of the performance period. The relevant target achievement for Revenue Growth and Net Income Growth is determined based on the CAGR over the entire performance period. The relevant target achievement for the ROIC target is determined based on the average annual target achievement for the ROIC during the performance period (i.e.,weighting per performance year).
The number of performance shares allocated to plan participants at the beginning of the performance period is multiplied with the degree of overall target achievement to determine the final number of performance shares.
Under the LTIP 2022+, the final number of performance shares generally vests three years after the allocation date (three-year vesting period). The number of vested performance shares is then multiplied with the average share price of the Company during a period of 30 days prior to the end of this three-year vesting period. The resulting amount is capped at 400% of a participant’s grant value and will be paid out as cash compensation.
The first allocation under the LTIP 2022+ was made on July 25, 2022. Under the LTIP 2022+, 1,673,865 performance shares with a total fair value of €67,725 were allocated. At the time of allocation, the fair value per performance share allocated under the LTIP 2022+ was €40.46.
In addition, 220,311 performance shares with a total fair value of €11,584 were allocated on March 1, 2022, under the Management Board Long Term Incentive Plan 2020, to the members of the Management Board and to senior members of the Company's managerial staff who serve on the Company's Executive Committee ("Executive Committee"). Of this number, 160,668 performance shares with a total fair value of €8,460 relate to members of the Management Board and 59,643 performance shares with a total fair value of €3,124 relate to members of the Executive Committee. These amounts will be amortized over the three-year vesting period. The weighted average fair value per performance share at the allocation date was €52.58.
11. Commitments and contingencies
Legal and regulatory matters
The Company is routinely involved in claims, lawsuits, regulatory and tax audits, investigations and other legal matters arising, for the most part, in the ordinary course of its business of providing health care services and products. Legal matters that the Company currently deems to be material or noteworthy are described below. The Company records its litigation reserves for certain legal proceedings and regulatory matters to the extent that the Company determines an unfavorable outcome is probable and the amount of loss can be reasonably estimated. For the other matters described below, the Company believes that the loss is not probable and/or the loss or range of possible losses cannot be reasonably estimated at this time. The outcome of litigation and other legal matters is always difficult to
50
FRESENIUS MEDICAL CARE AG & Co. KGaA
Notes to the interim consolidated financial statements
(unaudited)
(in THOUS, except share and per share data)
predict accurately and outcomes that are not consistent with the Company’s view of the merits can occur. The Company believes that it has valid defenses to the legal matters pending against it and is defending itself vigorously. Nevertheless, it is possible that the resolution of one or more of the legal matters currently pending or threatened could have a material adverse effect on its business, results of operations and financial condition.
Beginning in 2012, the Company received certain communications alleging conduct in countries outside the United States that might violate the U.S. Foreign Corrupt Practices Act (“FCPA”) or other anti-bribery laws. The Company conducted investigations with the assistance of outside counsel and, in a continuing dialogue, advised the Securities and Exchange Commission (“SEC”) and the United States Department of Justice (“DOJ”) about these investigations. The DOJ and the SEC also conducted their own investigations, in which the Company cooperated.
In the course of this dialogue, the Company identified and reported to the DOJ and the SEC, and took remedial actions with respect to, conduct that resulted in the DOJ and the SEC seeking monetary penalties including disgorgement of profits and other remedies. This conduct revolved principally around the Company’s products business in countries outside the United States.
On March 29, 2019, the Company entered into a non-prosecution agreement (“NPA”) with the DOJ and a separate agreement with the SEC (“SEC Order”) intended to resolve fully and finally the U.S. government allegations against the Company arising from the investigations. Both agreements included terms starting August 2, 2019. The DOJ NPA and SEC Order are both scheduled to terminate on December 31, 2022. In 2019, the Company paid a combined total in penalties and disgorgement of approximately $231,715 (€205,854) to the DOJ and the SEC in connection with these agreements. The entire amount paid to the DOJ and the SEC was reserved for in charges that the Company recorded in 2017 and 2018 and announced in 2018. As part of the resolution, the Company agreed to certain self-reporting obligations and to retain an independent compliance monitor. Due in part to COVID-19 pandemic restrictions, the monitorship program faced certain delays, but the Company is working to complete all its obligations under the resolution with the DOJ and SEC and expects the certification decision of the monitor by the end of 2022 and, if that decision is to certify, the formalization and publication of the end of the monitorship by the end of the first quarter in 2023.
In 2015, the Company self-reported to the German prosecutor conduct with a potential nexus to Germany and continues to cooperate with government authorities in Germany in their review of the conduct that prompted the Company’s and United States government investigations.
Since 2012, the Company has made and continues to make further significant investments in its compliance and financial controls and in its compliance, legal and financial organizations. The Company’s remedial actions included separation from those employees responsible for the above-mentioned conduct. The Company is dealing with post-FCPA review matters on various levels. The Company continues to be fully committed to compliance with the FCPA and other applicable anti-bribery laws.
Personal injury and related litigation involving FMCH’s acid concentrate product, labeled as Granuflo® or Naturalyte®, first arose in 2012. FMCH’s insurers agreed to the settlement in 2017 of personal injury litigation and funded $220,000 (€179,284) of the settlement fund under a reciprocal reservation of rights. FMCH accrued a net expense of $60,000 (€48,896) in connection with the settlement, including legal fees and other anticipated costs. Following the settlement, FMCH’s insurers in the AIG group initiated litigation against FMCH seeking to be indemnified by FMCH for their $220,000 (€179,284) outlay and FMCH initiated litigation against the AIG group to recover defense and indemnification costs FMCH had borne. National Union Fire Insurance v. Fresenius Medical Care, 2016 Index No. 653108 (Supreme Court of New York for New York County).
Discovery in the litigation is complete. The AIG group abandoned certain of its coverage claims and submitted expert reports on damages asserting that, if AIG prevails on all its remaining claims, it should recover $60,000 (€48,896). FMCH contests all of AIG’s claims and submitted expert reports supporting rights to recover $108,000 (€88,012) from AIG, in addition to the $220,000 (€179,284) already funded. A trial date has not been set in the matter.
In August 2014, FMCH received a subpoena from the United States Attorney’s Office (“USAO”) for the District of Maryland inquiring into FMCH’s contractual arrangements with hospitals and physicians involving contracts relating to the management of in-patient acute dialysis services. On August 27, 2020, after the USAO declined to pursue the matter by intervening, the United States District Court for Maryland unsealed a 2014 relator’s qui tam complaint that gave rise to the investigation. The relator thereafter served the complaint and proceeded on his own in part by filing an amended complaint making broad allegations about financial relationships between FMCH and nephrologists. FMCH’s motion to dismiss the amended complaint remains pending. On October 5, 2021, the District Court for Maryland granted FMCH’s motion to transfer the case to the United States District Court for Massachusetts, where the litigation continues. Flanagan v. Fresenius Medical Care Holdings, Inc., 1:21-cv-11627.
In July 2015, the Attorney General for Hawaii issued a civil complaint under the Hawaii False Claims Act alleging a conspiracy pursuant to which certain Liberty Dialysis subsidiaries of FMCH overbilled Hawaii Medicaid for Liberty’s Epogen® administrations to Hawaii Medicaid patients during the period from 2006 through 2010, prior to the time of FMCH’s acquisition of Liberty. Hawaii v. Liberty Dialysis—
51
FRESENIUS MEDICAL CARE AG & Co. KGaA
Notes to the interim consolidated financial statements
(unaudited)
(in THOUS, except share and per share data)
Hawaii, LLC et al., Case No. 15-1-1357-07 (Hawaii 1st Circuit). The State alleged that Liberty acted unlawfully by relying on incorrect and unauthorized billing guidance provided to Liberty by Hawaii’s contracted administrator for its Medicaid program.Liberty initiated an administrative action challenging the State’s recoupment of alleged overpayments from sums currently owed to Liberty. On June 7, 2022, FMCH and Hawaii entered into an agreement under which FMCH paid Hawaii $13,000 (€12,193) in restitution and interest and all claims, counterclaims, and cross-claims raised by or against FMCH in any part of the litigation were extinguished.
On August 31, 2015, FMCH received a subpoena under the False Claims Act from the United States Attorney for the District of Colorado (Denver) inquiring into FMCH’s participation in and management of dialysis facility joint ventures in which physicians are partners. FMCH cooperated in the Denver USAO investigation, which FMCH understands had concluded on or before June 1, 2022.
On November 25, 2015, FMCH received a subpoena under the False Claims Act from the United States Attorney for the Eastern District of New York (Brooklyn) also inquiring into FMCH’s involvement in certain dialysis facility joint ventures in New York. On September 26, 2018, the Brooklyn USAO declined to intervene on the qui tam complaint filed under seal in 2014 that gave rise to this investigation. CKD Project LLC v. Fresenius Medical Care, 2014 Civ. 06646 (E.D.N.Y. November 12, 2014). The District Court unsealed the complaint, allowing the relator to proceed on its own. On August 3, 2021, the District Court granted FMCH’s motion to dismiss the relator’s amended complaint, dismissed the case with prejudice and declined to allow further amendment. On August 27, 2021, the relator appealed to the United States Court of Appeals for the Second Circuit.
In 2014, two New York physicians filed under seal a qui tam complaint in the United States District Court for the Eastern District of New York (Brooklyn), alleging violations of the False Claims Act relating to FMCH’s vascular access line of business. As previously disclosed, on October 6, 2015, the United States Attorney for the Eastern District of New York (Brooklyn) issued subpoenas to FMCH indicating its investigation now seen to be related to the two relators’ complaint. FMCH cooperated in the Brooklyn investigation, which was understood to be separate and distinct from settlements entered in 2015 in Connecticut, Florida and Rhode Island of allegations against American Access Care LLC (“AAC”) following FMCH’s 2011 acquisition of AAC.
On July 12, 2022, after the Court denied the USAO’s motions to renew the sealing of the relators’ complaint, the USAO filed a complaint-in-intervention. United States ex rel. Pepe and Sherman v. Fresenius Vascular Care, Inc. et al, 1:14-cv-3505. The United States’ and relators’ complaints allege that the defendants billed and received government payment for surgery that was not medically necessary. FMCH expects to defend the allegations asserted in the litigation now proceeding.
On November 18, 2016, FMCH received a subpoena under the False Claims Act from the United States Attorney for the Eastern District of New York (Brooklyn) seeking documents and information relating to the operations of Shiel Medical Laboratory, Inc. (“Shiel”), which FMCH acquired in October 2013. FMCH advised the USAO that, under the asset sale provisions of its 2013 Shiel acquisition, it was not responsible for Shiel’s conduct prior to the date of the acquisition. On December 12, 2017, FMCH sold to Quest Diagnostics certain Shiel operations. Nonetheless, FMCH cooperated in the Brooklyn USAO’s investigation.
On June 14, 2022, the Brooklyn USAO declined to intervene on two anonymous relator complaints that underlay the investigation. The relators, who remain anonymous, are proceeding with litigation at their own expense against both Shiel and FMCH entities, alleging that the defendants wrongly caused government payers to pay for laboratory tests that were falsely or improperly invoiced and retaliated against relators for objecting to the alleged misconduct. Relator v. Shiel Medical Laboratory, 1:16-cv-01090 (E.D.N.Y. 2016); Relator v. Shiel Holdings, 1:17-cv-02732 (E.D.N.Y. 2017). FMCH will defend allegations directed against entities it controls.
On March 12, 2018, Vifor Fresenius Medical Care Renal Pharma Ltd. and Vifor Fresenius Medical Care Renal Pharma France S.A.S. (collectively, “VFMCRP”) (see note 4), filed a complaint for patent infringement against Lupin Atlantis Holdings SA and Lupin Pharmaceuticals Inc. (collectively, “Lupin”), and Teva Pharmaceuticals USA, Inc. (“Teva”) in the U.S. District Court for the District of Delaware (Case 1:18-cv-00390-MN, “first complaint”). The patent infringement action is in response to Lupin and Teva’s filings of Abbreviated New Drug Applications (“ANDA”) with the U.S. Food and Drug Administration (“FDA”) for generic versions of Velphoro®. Velphoro® is protected by patents listed in the FDA’s Approved Drug Products with Therapeutic Equivalence Evaluations, also known as the Orange Book. The complaint was filed within the 45-day period provided for under the Hatch-Waxman legislation, and triggered a stay of FDA approval of the ANDAs for 30 months (specifically, up to July 29, 2020 for Lupin’s ANDA; and August 6, 2020 for Teva’s ANDA. In response to another ANDA being filed for a generic Velphoro®, VFMCRP filed a complaint for patent infringement against Annora Pharma Private Ltd., and Hetero Labs Ltd. (collectively, “Annora”), in the U.S. District Court for the District of Delaware on December 17, 2018. The case was settled among the parties, thus terminating the court action on August 4, 2020. On May 26, 2020, VFMCRP filed a further complaint for patent infringement against Lupin in the U.S. District Court for the District of Delaware (Case No. 1:20-cv-00697-MN) in response to Lupin’s ANDA for a generic version of Velphoro® and on the basis of a newly listed patent in the Orange Book. On July 6, 2020, VFMCRP filed an additional complaint for patent infringement against Lupin and Teva in the U.S. District Court for the District of Delaware (Case No. 1:20-cv-00911-MN, “second complaint”) in response to the companies’ ANDA for generic versions of Velphoro® and on the basis of two newly listed patents in the Orange Book. All cases involving Lupin as defendant were settled among the parties, thus terminating the corresponding court actions on December 18, 2020. In relation to the remaining pending
52
FRESENIUS MEDICAL CARE AG & Co. KGaA
Notes to the interim consolidated financial statements
(unaudited)
(in THOUS, except share and per share data)
cases and the defendant Teva, trial took place for the first complaint between January 19 and 22, 2021. Another patent newly listed in the Orange Book was added to the second complaint on June 23, 2021. Trial was scheduled for the second complaint for late June 2022, but was cancelled on June 14, 2022. By final judgement dated August 25, 2022, the Court decided for the first complaint that the generic product proposed in Teva's ANDA infringes the patent claims subject to the complaint and that such patent claims are valid. Further, unless the order is overturned or the parties agree otherwise, the effective date of any final approval by the FDA for Teva's ANDA shall not be a date until the underlying patent, including any pediatric extension, expires. On September 21, 2022, Teva filed an appeal to the U.S. Court of Appeals for the Federal Circuit to contest the first instance Court decision. Also on September 21, 2022, VFMCRP filed another complaint for patent infringement against Teva in the U.S. District Court for the District of Delaware (Case No. 1:22-cv-01227-MN, “third complaint”) in response to the company’s ANDA for generic versions of Velphoro® and on the basis of another newly listed patent in the Orange Book. On October 4, 2022, a motion to stay the proceedings of the second complaint until the appeal for the first complaint is resolved was granted by the first instance Court.
On December 17, 2018, FMCH was served with a subpoena under the False Claims Act from the United States Attorney for the District of Colorado (Denver) as part of an investigation of allegations against DaVita, Inc. (“DaVita”) involving transactions between FMCH and DaVita. The subject transactions include sales and purchases of dialysis facilities, dialysis-related products and pharmaceuticals, including dialysis machines and dialyzers, and contracts for certain administrative services. FMCH cooperated in the investigation.
On June 28, 2019, certain FMCH subsidiaries filed a complaint against the United States seeking to recover monies owed to them by the United States Department of Defense under the Tricare program, and to preclude Tricare from recouping monies previously paid. Bio-Medical Applications of Georgia, Inc., et al. v. United States, CA 19-947, United States Court of Federal Claims. Tricare provides reimbursement for dialysis treatments and other medical care provided to members of the military services, their dependents and retirees. The litigation challenges unpublished administrative actions by Tricare administrators reducing the rate of compensation paid for dialysis treatments provided to Tricare beneficiaries based on a recasting or “crosswalking” of codes used and followed in invoicing without objection for many years. Tricare administrators have acknowledged the unpublished administrative action and declined to change or abandon it. On July 8, 2020, the U.S. government filed its answer (and confirmed its position) and litigation is continuing. The court has not yet set a date for trial in this matter. FMCH has imposed a constraint on revenue otherwise recognized from the Tricare program that it believes, in consideration of facts currently known, sufficient to account for the risk of this litigation.
On August 21, 2020, FMCH was served with a subpoena from the United States Attorney for the District of Massachusetts requesting information and documents related to urgent care centers that FMCH owned, operated, or controlled as part of its ChoiceOne and Medspring urgent care operations prior to its divestiture of and exit from that line of business in 2018. The subpoena appears to be related to an ongoing investigation of alleged upcoding in the urgent care industry, which has resulted in certain published settlements under the federal False Claims Act. FMCH is cooperating in the investigation.
In February 2022, the Company received a formal request for information from the Hessen Data Protection Authority (“Hessischer Beauftragter für Datenschutz und Informationsfreiheit” or “HBDI”). The information request relates to specific data processing functions of a few of the Company’s peritoneal dialysis devices. The Company is committed to comply with the HBDI’s request and cooperate with them, and it is working to provide the relevant information.
On March 20 and April 12, 2022, respectively, an attorney employed as general counsel for the Company’s North American division from 2013 to 2016 filed a complaint with the Occupational Safety and Health Administration (“OSHA”) under the Sarbanes-Oxley Act of 2002 and other anti-retaliation statutes, and a civil lawsuit in Suffolk County, Massachusetts seeking compensation for personnel management decisions allegedly adverse to him. OSHA Case No. 1-076-22-049; Kott v. National Medical Care, Inc., Case No. 22-802 (Superior Court, Suffolk County, Mass.).
The plaintiff alleges in support of his demands for compensation that he was transferred to a subordinate position in the global legal department, and subsequently terminated from employment as part of the FME 25 reorganization, in retaliation for legal advice he provided with respect to a licensing agreement with DaVita relating to pharmaceutical operations and products. The DaVita licensing agreement expired by its terms in 2017.
As previously disclosed in the Company’s financial statements, the United States Department of Justice has reviewed multiple aspects of the DaVita contract in question, including those relevant to the plaintiff’s allegations. No enforcement action has resulted against the Company.
Other bases of retaliation alleged by the plaintiff implicate internal personnel and privacy protection concerns that do not impact ongoing operations, and on which the Company does not comment.
On April 21, 2022, FMCH paused shipping of new dialysis machines in the United States at the recommendation of the FDA following FMCH’s voluntary report of a potential bio-compatibility concern. The concern arose from a component that was already scheduled to be
53
FRESENIUS MEDICAL CARE AG & Co. KGaA
Notes to the interim consolidated financial statements
(unaudited)
(in THOUS, except share and per share data)
replaced later in 2022. As of October 28, 2022, FMCH received clearance from the FDA encompassing the replacement component and resumed shipping machines.
From time to time, the Company is a party to or may be threatened with other litigation or arbitration, claims or assessments arising in the ordinary course of its business. Management regularly analyzes current information including, as applicable, the Company's defenses and insurance coverage and, as necessary, provides accruals for probable liabilities for the eventual disposition of these matters.
The Company, like other health care providers, insurance plans and suppliers, conducts its operations under intense government regulation and scrutiny.The Company must comply with regulations which relate to or govern the safety and efficacy of medical products and supplies, the marketing and distribution of such products, the operation of manufacturing facilities, laboratories, dialysis clinics and other health care facilities, and environmental and occupational health and safety. With respect to its development, manufacture, marketing and distribution of medical products, if such compliance is not maintained, the Company could be subject to significant adverse regulatory actions by the FDA and comparable regulatory authorities outside the U.S. These regulatory actions could include warning letters or other enforcement notices from the FDA, and/or comparable foreign regulatory authority which may require the Company to expend significant time and resources in order to implement appropriate corrective actions. If the Company does not address matters raised in warning letters or other enforcement notices to the satisfaction of the FDA and/or comparable regulatory authorities outside the U.S., these regulatory authorities could take additional actions, including product recalls, injunctions against the distribution of products or operation of manufacturing plants, civil penalties, seizures of the Company’s products and/or criminal prosecution. FMCH completed remediation efforts with respect to one pending FDA warning letter and is awaiting confirmation as to whether the letter is now closed. The Company must also comply with the laws of the United States, including the federal Anti-Kickback Statute, the federal False Claims Act, the federal Stark Law, the federal Civil Monetary Penalties Law and the federal Foreign Corrupt Practices Act as well as other federal and state fraud and abuse laws. Applicable laws or regulations may be amended, or enforcement agencies or courts may make interpretations that differ from the Company’s interpretations or the manner in which it conducts its business. Enforcement has become a high priority for the federal government and some states. In addition, the provisions of the False Claims Act authorizing payment of a portion of any recovery to the party bringing the suit encourage private plaintiffs to commence whistleblower actions. By virtue of this regulatory environment, the Company’s business activities and practices are subject to extensive review by regulatory authorities and private parties, and continuing audits, subpoenas, other inquiries, claims and litigation relating to the Company’s compliance with applicable laws and regulations. The Company may not always be aware that an inquiry or action has begun, particularly in the case of whistleblower actions, which are initially filed under court seal.
The Company operates many facilities and handles the personal data of its patients and beneficiaries throughout the United States and other parts of the world and engages with other business associates to help it carry out its health care activities. In such a widespread, global system, it is often difficult to maintain the desired level of oversight and control over the thousands of individuals employed by many affiliated companies and its business associates. On occasion, the Company or its business associates may experience a breach under the Health Insurance Portability and Accountability Act Privacy Rule and Security Rules, the EU’s General Data Protection Regulation and or other similar laws (“Data Protection Laws”) when there has been impermissible use, access, or disclosure of unsecured personal data or when the Company or its business associates neglect to implement the required administrative, technical and physical safeguards of its electronic systems and devices, or a data breach that results in impermissible use, access or disclosure of personal identifying information of its employees, patients and beneficiaries. On those occasions, the Company must comply with applicable breach notification requirements.
The Company relies upon its management structure, regulatory and legal resources, and the effective operation of its compliance program to direct, manage and monitor the activities of its employees. On occasion, the Company may identify instances where employees or other agents deliberately, recklessly or inadvertently contravene the Company’s policies or violate applicable law. The actions of such persons may subject the Company and its subsidiaries to liability under the Anti-Kickback Statute, the Stark Law, the False Claims Act, Data Protection Laws, the Health Information Technology for Economic and Clinical Health Act and the FCPA, among other laws and comparable state laws or laws of other countries.
Physicians, hospitals and other participants in the health care industry are also subject to a large number of lawsuits alleging professional negligence, malpractice, product liability, worker’s compensation or related claims, many of which involve large claims and significant defense costs. The Company has been and is currently subject to these suits due to the nature of its business and expects that those types of lawsuits may continue. Although the Company maintains insurance at a level which it believes to be prudent, it cannot assure that the coverage limits will be adequate or that insurance will cover all asserted claims. A successful claim against the Company or any of its subsidiaries in excess of insurance coverage could have a material adverse effect upon it and the results of its operations. Any claims, regardless of their merit or eventual outcome, could have a material adverse effect on the Company’s reputation and business.
54
FRESENIUS MEDICAL CARE AG & Co. KGaA
Notes to the interim consolidated financial statements
(unaudited)
(in THOUS, except share and per share data)
The Company has also had claims asserted against it and has had lawsuits filed against it relating to alleged patent infringements or businesses that it has acquired or divested. These claims and suits relate both to operation of the businesses and to the acquisition and divestiture transactions. The Company has, when appropriate, asserted its own claims, and claims for indemnification. A successful claim against the Company or any of its subsidiaries could have a material adverse effect upon its business, financial condition, and the results of its operations. Any claims, regardless of their merit or eventual outcome, could have a material adverse effect on the Company’s reputation and business.
In Germany, the tax audits for the years 2006 through 2009 have been substantially completed. The German tax authorities have indicated a re-qualification of dividends received in connection with intercompany mandatorily redeemable preferred shares into fully taxable interest payments for these and subsequent years until 2013 which could lead to additional tax payments in the middle double-digit million range. Additionally, in August 2022, German tax authorities objected to the Company’s tax returns and took the position that income of one of the Company's finance entities should be subject to German Controlled Foreign Corporation taxation resulting in potential additional income tax payments in the upper double-digit million range. In the latter case, the Company has filed appeals against the assessments. In both cases, the Company will defend its position and will avail itself of further appropriate remedies. The Company is also subject to ongoing and future tax audits in the U.S., Germany and other jurisdictions in the ordinary course of business. Tax authorities routinely pursue adjustments to the Company’s tax returns and disallowances of claimed tax deductions. When appropriate, the Company defends these adjustments and disallowances and asserts its own claims. A successful tax related claim against the Company or any of its subsidiaries could have a material adverse effect upon its business, financial condition and results of operations.
The Company is subject to residual value guarantees in certain lease contracts, primarily real estate contracts, for which it is the lessee in the amount of $433,644 (€444,854). Under the terms of these leases, the Company has the option to remarket the underlying leased properties to satisfy its residual value guarantee obligations at the end of the lease term. As of September 30, 2022, the estimated fair market value of the underlying leased assets exceeded the related residual value guarantees and, therefore, the Company did not have any risk exposure relating to these guarantees.
Other than those individual contingent liabilities mentioned above, the current estimated amount of the Company’s other known individual contingent liabilities is immaterial.
55
FRESENIUS MEDICAL CARE AG & Co. KGaA
Notes to the interim consolidated financial statements
(unaudited)
(in THOUS, except share and per share data)
12. Financial instruments
The following tables show the carrying amounts and fair values of the Company’s financial instruments at September 30, 2022 and December 31, 2021:
Carrying amount and fair value of financial instruments
in € THOUS
56
FRESENIUS MEDICAL CARE AG & Co. KGaA
Notes to the interim consolidated financial statements
(unaudited)
(in THOUS, except share and per share data)
Carrying amount and fair value of financial instruments
in € THOUS
(1) | As of September 30, 2022 and December 31, 2021, other financial assets primarily include lease receivables, deposits, guarantees, securities, vendor and supplier rebates as well as notes receivable. |
(2) | As of September 30, 2022 and December 31, 2021, other financial liabilities primarily include receivable credit balances and goods and services received. |
Derivative and non-derivative financial instruments are categorized in the following three-tier fair value hierarchy that reflects the significance of the inputs in making the measurements. Level 1 inputs are quoted prices for similar instruments in active markets. Level 2 is defined as using valuation models (i.e. mark-to-model) with input factors that are inputs other than quoted prices in active markets that are directly or indirectly observable. Level 3 is defined as using valuation models (i.e. mark-to-model) with input factors that are unobservable inputs for which little or no market data exists, therefore requiring the Company to develop its own assumptions. Fair value information is not provided for financial instruments, if the carrying amount is a reasonable estimate of fair value due to the relatively short period of maturity of these instruments. This includes cash and cash equivalents measured at amortized costs, trade accounts and other receivables from unrelated parties, accounts receivable from related parties, other financial assets as well as accounts payable to unrelated parties, accounts payable to related parties, short-term debt and other financial liabilities. Transfers between levels of the fair value hierarchy have not occurred as of September 30, 2022. At September 30, 2021, the Company transferred its investment in Humacyte, Inc. (“Humacyte”) with a carrying amount of €158,551 from Level 3 to Level 1, after Humacyte completed its merger with Alpha Healthcare Acquisition Corporation, a special purpose acquisition company. The shares in Alpha Healthcare Acquisition Corporation (now called Humacyte) received by the Company as a result of this merger and in a contemporaneous private placement are quoted in an active market, and Humacyte has registered the Company’s shares for resale under the Securities Act of 1933. No additional transfers between levels of the fair value hierarchy occurred as of December 31, 2021. The Company accounts for transfers at the end of the reporting period.
57
FRESENIUS MEDICAL CARE AG & Co. KGaA
Notes to the interim consolidated financial statements
(unaudited)
(in THOUS, except share and per share data)
Derivative financial instruments
In order to manage the risk of currency exchange rate and interest rate fluctuations, the Company enters into various hedging transactions by means of derivative instruments with highly rated financial institutions. The Company primarily enters into foreign exchange forward contracts and interest rate swaps. In certain instances, the Company enters into derivative contracts that do not qualify for hedge accounting but are utilized for economic purposes (“economic hedges”). The Company does not use financial instruments for trading purposes.
Non-derivative financial instruments
The significant methods and assumptions used for the classification and measurement of non-derivative financial instruments are as follows:
The Company assessed its business models and the cash flow characteristics of its financial assets. The vast majority of the non-derivative financial assets are held in order to collect the contractual cash flows. The contractual terms of the financial assets allow the conclusion that the cash flows represent payment of principal and interest only. Trade accounts and other receivables from unrelated parties, Accounts receivable from related parties and Other financial assets are consequently measured at amortized cost.
Cash and cash equivalents are comprised of cash funds and other short-term investments. Cash funds are measured at amortized cost. Short-term investments are highly liquid and readily convertible to known amounts of cash. Short-term investments are measured at fair value through profit or loss (“FVPL”). The risk of changes in fair value is insignificant.
Equity investments are not held for trading. At initial recognition the Company elected, on an instrument-by-instrument basis, to represent subsequent changes in the fair value of individual strategic investments in OCI. If equity instruments are quoted in an active market, the fair value is based on price quotations at the period-end-date. As necessary, the Company engages external valuation firms to assist in determining the fair value of Level 3 equity investments. The external valuation uses a discounted cash flow model, which includes significant unobservable inputs such as investment specific forecasted financial statements and weighted average cost of capital, that reflects current market assessments as well as a terminal growth rate.
The majority of the debt securities are held within a business model whose objective is achieving both contractual cash flows and selling the securities. The standard coupon bonds give rise on specified dates to cash flows that are solely payments of principal and interest on the outstanding principal amount. Subsequently these financial assets have been classified as fair value through other comprehensive income (“FVOCI”). The smaller part of debt securities does not give rise to cash flows that are solely payments of principal and interest. Consequently, these securities are measured at FVPL. In general, most of the debt securities are quoted in an active market.
Long-term debt is initially recognized at its fair value. The fair values of major long-term debt are calculated on the basis of market information. Liabilities for which market quotes are available are measured using these quotes. The fair values of the other long-term debt are calculated at the present value of the respective future cash flows. To determine these present values, the prevailing interest rates and credit spreads for the Company as of the balance sheet date are used.
Variable payments outstanding for acquisitions are recognized at their fair value. The estimation of the individual fair values is based on the key inputs of the arrangement that determine the future contingent payment as well as the Company’s expectation of these factors. The Company assesses the likelihood and timing of achieving the relevant objectives. The underlying assumptions are reviewed regularly.
Put option liabilities are recognized at the present value of the exercise price of the option. The exercise price of the option is generally based on fair value and, in certain limited instances, might contain a fixed floor price. The methodology the Company uses to estimate the fair values assumes the greater of net book value or a multiple of earnings, based on historical earnings, development stage of the underlying business and other factors. From time to time the Company engages an external valuation firm to assist in the valuation of certain put options. The external valuation assists the Company in estimating the fair values using a combination of discounted cash flows and a multiple of earnings and/or revenue. Under those limited circumstances in which the put option might contain a fixed floor price, the external valuation firm may assist the Company with the valuation by performing a Monte Carlo Simulation analysis to simulate the exercise price. The put option liabilities are discounted at a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the liability. The estimated fair values of these put options can also fluctuate, and the discounted cash flows as well as the implicit multiple of earnings and/or revenue at which these obligations may ultimately be settled could vary significantly from the Company’s current estimates depending upon market conditions. For the purpose of analyzing the impact of changes in unobservable inputs on the fair value measurement of put option liabilities, the Company assumes an increase on earnings (or enterprise value for the put options granted in the InterWell Health business combination) of 10% compared to the actual estimation as of the balance sheet date. The corresponding increase in fair value of €113,893 is then compared to the total liabilities and the shareholder’s equity of the Company. This analysis shows that an increase of 10% in the relevant earnings (or enterprise value for the
58
FRESENIUS MEDICAL CARE AG & Co. KGaA
Notes to the interim consolidated financial statements
(unaudited)
(in THOUS, except share and per share data)
put options granted in the InterWell Health business combination) would have an effect of less than 1% on the total liabilities and less than 1% on the shareholder’s equity of the Company.
Following is a roll forward of Level 3 financial instruments at September 30, 2022 and December 31, 2021:
Reconciliation from beginning to ending balance of level 3 financial instruments
in € THOUS
| (1) | Includes realized and unrealized gains / losses. |
13. Segment and corporate information
The Company’s operating and reportable segments are the North America Segment, the EMEA Segment, the Asia-Pacific Segment and the Latin America Segment. The operating segments are determined based upon how the Company manages its businesses with geographical responsibilities. All segments are primarily engaged in providing health care services and the distribution of products and equipment for the treatment of ESKD and other extracorporeal therapies.
Management evaluates each segment using measures that reflect all of the segment’s controllable revenues and expenses. With respect to the performance of business operations, management believes that the most appropriate measures are revenue and operating income. The Company does not include income taxes as it believes taxes are outside the segments’ control. Financing is a corporate function, which the Company’s segments do not control. Therefore, the Company does not include interest expense relating to financing as a segment measurement. Similarly, the Company does not allocate certain costs, which relate primarily to certain headquarters’ overhead charges, including accounting and finance as well as certain legal and IT costs, because the Company believes that these costs are also not within the control of the individual segments. Production of products, production asset management, quality and supply chain management as well as procurement related to production are centrally managed. Products transferred to the segments are transferred at cost; therefore, no internal profit is generated. The associated internal revenue for the product transfers and their elimination are recorded as corporate activities. Capital expenditures for production are based on the expected demand of the segments and consolidated profitability considerations. The Company’s global research and development team as well as its Global Medical Office, which seek to optimize medical treatments and clinical processes within the Company, are also centrally managed. These corporate activities (“Corporate”) do not fulfill the definition of a segment according to IFRS 8, Operating Segments. In addition, certain revenues, investments and intangible assets, as well as any related expenses, are not allocated to a segment but are accounted for as Corporate.
Information pertaining to the Company’s segment and Corporate activities for the three and nine months ended September 30, 2022 and 2021 is set forth below:
59
FRESENIUS MEDICAL CARE AG & Co. KGaA
Notes to the interim consolidated financial statements
(unaudited)
(in THOUS, except share and per share data)
Segment and corporate information
in € THOUS
| (1) | Includes inter - segment consolidation adjustments. |
60
FRESENIUS MEDICAL CARE AG & Co. KGaA
Notes to the interim consolidated financial statements
(unaudited)
(in THOUS, except share and per share data)
Segment and corporate information (continued) | ||||||||||||||
in € THOUS |
|
|
|
|
|
|
| |||||||
North | Latin | |||||||||||||
America | EMEA | Asia-Pacific | America | Total | ||||||||||
| Segment |
| Segment |
| Segment |
| Segment |
| Segment |
| Corporate (1) |
| Total | |
Nine months ended September 30, 2022 |
|
|
|
|
|
|
| |||||||
Revenue from health care services | 8,818,628 | 1,083,193 | 729,685 | 451,858 | 11,083,364 | 22,689 | 11,106,053 | |||||||
Revenue from health care products |
| 823,099 |
| 1,016,832 |
| 816,747 |
| 178,985 |
| 2,835,663 |
| 15,301 |
| 2,850,964 |
Revenue from contracts with customers |
| 9,641,727 |
| 2,100,025 |
| 1,546,432 |
| 630,843 |
| 13,919,027 |
| 37,990 |
| 13,957,017 |
Other revenue external customers |
| 378,929 |
| 20,817 |
| 41,850 |
| 2,602 |
| 444,198 |
| — |
| 444,198 |
Revenue external customers |
| 10,020,656 |
| 2,120,842 |
| 1,588,282 |
| 633,445 |
| 14,363,225 |
| 37,990 |
| 14,401,215 |
Inter-segment revenue |
| 13,218 |
| — |
| 223 |
| 1,179 |
| 14,620 |
| (14,620) |
| — |
Revenue |
| 10,033,874 |
| 2,120,842 |
| 1,588,505 |
| 634,624 |
| 14,377,845 |
| 23,370 |
| 14,401,215 |
Operating income |
| 1,112,931 |
| 168,614 |
| 255,125 |
| 15,829 |
| 1,552,499 |
| (392,678) |
| 1,159,821 |
Interest |
|
|
|
|
|
|
| (217,161) | ||||||
Income before income taxes |
|
|
|
|
|
|
| 942,660 | ||||||
Depreciation and amortization |
| (807,532) |
| (143,780) |
| (80,829) |
| (34,150) |
| (1,066,291) |
| (212,536) |
| (1,278,827) |
Impairment loss |
| (61,224) |
| (2,779) |
| (2) |
| — |
| (64,005) |
| (858) |
| (64,863) |
Income (loss) from equity method investees |
| 62,805 |
| (16,086) |
| (126) |
| 709 |
| 47,302 |
| — |
| 47,302 |
Total assets |
| 26,023,066 |
| 4,049,028 |
| 3,035,833 |
| 921,255 |
| 34,029,182 |
| 4,377,253 |
| 38,406,435 |
thereof investments in equity method investees |
| 437,166 |
| 198,060 |
| 105,776 |
| 26,697 |
| 767,699 |
| — |
| 767,699 |
Additions of property, plant and equipment, intangible assets and right-of-use assets |
| 521,607 |
| 100,661 |
| 60,981 |
| 27,631 |
| 710,880 |
| 177,107 |
| 887,987 |
Nine months ended September 30, 2021 |
|
|
|
|
|
|
| |||||||
Revenue from health care services |
| 7,855,557 |
| 1,020,400 |
| 693,951 |
| 364,072 |
| 9,933,980 |
| 28,901 |
| 9,962,881 |
Revenue from health care products |
| 771,863 |
| 974,380 |
| 729,388 |
| 141,717 |
| 2,617,348 |
| 12,281 |
| 2,629,629 |
Revenue from contracts with customers |
| 8,627,420 |
| 1,994,780 |
| 1,423,339 |
| 505,789 |
| 12,551,328 |
| 41,182 |
| 12,592,510 |
Other revenue external customers |
| 304,017 |
| 38,485 |
| 34,641 |
| 2,008 |
| 379,151 |
| — |
| 379,151 |
Revenue external customers |
| 8,931,437 |
| 2,033,265 |
| 1,457,980 |
| 507,797 |
| 12,930,479 |
| 41,182 |
| 12,971,661 |
Inter-segment revenue |
| 26,243 |
| — |
| 361 |
| — |
| 26,604 |
| (26,604) |
| — |
Revenue |
| 8,957,680 |
| 2,033,265 |
| 1,458,341 |
| 507,797 |
| 12,957,083 |
| 14,578 |
| 12,971,661 |
Operating income |
| 1,241,989 |
| 232,030 |
| 255,780 |
| 13,583 |
| 1,743,382 |
| (340,247) |
| 1,403,135 |
Interest |
|
|
|
|
|
|
| (213,717) | ||||||
Income before income taxes |
|
|
|
|
|
|
| 1,189,418 | ||||||
Depreciation and amortization |
| (727,271) |
| (146,943) |
| (76,855) |
| (28,040) |
| (979,109) |
| (192,061) |
| (1,171,170) |
Impairment loss |
| (9,349) |
| — |
| — |
| — |
| (9,349) |
| (6,049) |
| (15,398) |
Income (loss) from equity method investees |
| 69,303 |
| (248) |
| 1,489 |
| 670 |
| 71,214 |
| — |
| 71,214 |
Total assets |
| 22,991,521 |
| 3,964,433 |
| 2,904,586 |
| 787,526 |
| 30,648,066 |
| 3,182,860 |
| 33,830,926 |
thereof investments in equity method investees |
| 434,975 |
| 182,138 |
| 101,222 |
| 24,464 |
| 742,799 |
| — |
| 742,799 |
Additions of property, plant and equipment, intangible assets and right-of-use assets |
| 655,916 |
| 136,054 |
| 61,272 |
| 38,916 |
| 892,158 |
| 188,813 |
| 1,080,971 |
| (1) | Includes inter - segment consolidation adjustments. |
14. Events occurring after the balance sheet date
No significant activities have taken place subsequent to the balance sheet date September 30, 2022 that have a material impact on the key figures and earnings presented. Currently, there are no significant changes in the Company’s structure, management, legal form or personnel.
61
Quantitative and qualitative disclosures about market risk
The information in note 23 of the notes to the consolidated financial statements included in the Company’s Annual Report on Form 20-F for the year ended December 31, 2021, is incorporated by this reference.
62
Controls and procedures
The Company is a “foreign private issuer” within the meaning of Rule 3b-4(c) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). As such, the Company is not required to file quarterly reports with the Securities and Exchange Commission (“the Commission”) and is required to provide an evaluation of the effectiveness of its disclosure controls and procedures, to disclose significant changes in its internal control over financial reporting and to provide certifications of its Chief Executive Officer and Chief Financial Officer under Sections 302 and 906 of the Sarbanes-Oxley Act of 2002 only in its Annual Report on Form 20-F. The Company furnishes quarterly financial information to the Commission and such certifications under cover of Form 6-K on a voluntary basis and pursuant to the provisions of the Company’s pooling agreement entered into for the benefit of the public holders of our shares. As Dr. Carla Kriwet assumed the position of Chief Executive Officer during the previous calendar month, Ms. Helen Giza, our Deputy Chief Executive Officer and Chief Financial Officer has assumed certain functions of the role of Chief Executive Officer for a brief interim period.
In connection with such voluntary reporting, the Company’s management, including the Deputy Chief Executive Officer and Chief Financial Officer of the Company’s General Partner, has conducted an evaluation of the effectiveness of the Company’s disclosure controls and procedures as of the end of the period covered by this report, of the type contemplated by Securities Exchange Act Rule 13a-15. Based on that evaluation, the Deputy Chief Executive Officer and Chief Financial Officer concluded in connection with the furnishing of this report, that the Company’s disclosure controls and procedures are designed to ensure that the information the Company is required to disclose in the reports filed or furnished under the Act is recorded, processed, summarized and reported within the time periods specified in the Commission’s rules and forms and are effective to ensure that the information the Company is required to disclose in its reports is accumulated and communicated to the General Partner’s Management Board, including the General Partner’s Deputy Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure. During the past fiscal quarter, there have been no significant changes in internal controls, or in factors that could significantly affect internal controls.
For information regarding our non-prosecution agreement with the DOJ and the separate agreement with the SEC to resolve the government allegations against us concerning conduct that might violate the FCPA or other anti-bribery laws, and our related investments in compliance and financial controls, see note 11 of the notes to the consolidated financial statements (unaudited) presented elsewhere in this Report.
63
OTHER INFORMATION
Legal proceedings
The information in note 11 of the notes to the consolidated financial statements (unaudited), presented elsewhere in this report, is incorporated by this reference.
64
Exhibits
The following exhibits are filed within this Report:
31.1 | ||
32.1 | ||
101 | The following financial statements as of and for the three- and nine-month periods ended September 30, 2022 from FMC AG & Co. KGaA’s Report on Form 6-K for the month of October 2022, formatted in iXBRL (Inline eXtensible Business Reporting Language) and included in the body of this report: (i) Consolidated Statements of Income, (ii) Consolidated Statements of Comprehensive Income, (iii) Consolidated Balance Sheets, (iv) Consolidated Statements of Cash Flows, (v) Consolidated Statements of Shareholders’ Equity and (vi) Notes to the Consolidated Financial Statements. |
65
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
DATE: October 31, 2022
FRESENIUS MEDICAL CARE AG & Co. KGaA | ||
a partnership limited by shares, represented by: | ||
FRESENIUS MEDICAL CARE MANAGEMENT AG, | ||
its General Partner | ||
By: | /s/ HELEN GIZA | |
Name: | Helen Giza | |
Title: | Deputy Chief Executive Officer, Chief Financial Officer and member of the Management Board of the General Partner | |
By: | /s/ RICE POWELL | |
Name: | Rice Powell | |
Title: | Member of the Management Board of the General Partner | |
66
Exhibit 10.3
MIFID II PRODUCT GOVERNANCE / RETAIL INVESTORS, PROFESSIONAL INVESTORS AND ECPS TARGET MARKET – Solely for the purposes of each manufacturer's product approval process, the target market assessment in respect of the Notes has led to the conclusion that: (i) the target market for the Notes is eligible counterparties, professional clients and retail clients, each as defined in Directive 2014/65/EU of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments, as amended (MiFID II); and (ii) all channels for distribution to eligible counterparties and professional clients are appropriate; and (iii) the following channels for distribution of the Notes to retail clients are appropriate - investment advice, portfolio management and non-advised sales. Any person subsequently offering, selling or recommending the Notes (each a Distributor) should take into consideration the manufacturers' target market assessment; however, a Distributor subject to MiFID II is responsible for undertaking its own target market assessment in respect of the Notes (by either adopting or refining the manufacturers' target market assessment) and determining appropriate distribution channels, subject to the Distributor’s suitability and appropriateness obligations under MiFID II, as applicable. The targeted investors are expected to have (1) at least informed knowledge and/or experience with financial products, (2) the ability to bear losses resulting from interest rate changes and no capital loss bearing capacity if held to maturity, (3) a medium risk profile (4) a general capital formation/ asset optimization as investment objective and (5) a medium-term investment horizon. Fresenius Medical Care AG & Co. KGaA is not a manufacturer or Distributor for the purposes of the MiFID Product Governance Rules.
MiFID II PRODUKTÜBERWACHUNGSPFLICHTEN / ZIELMARKT KLEINANLEGER, PROFESSIONELLE INVESTOREN UND GEEIGNETE GEGENPARTEIEN – Die Zielmarktbestimmung im Hinblick auf die Schuldverschreibungen hat – ausschließlich für den Zweck des Produktgenehmigungsverfahrens jedes Konzepteurs – zu dem Ergebnis geführt, dass (i) der Zielmarkt für die Schuldverschreibungen geeignete Gegenparteien, professionelle Kunden und Kleinanleger, jeweils im Sinne der Richtlinie 2014/65/EU des Europäischen Parlaments und des Rates vom 15. Mai 2014 über Märkte für Finanzinstrumente in der jeweils gültigen Fassung (MiFID II), umfasst; und (ii) alle Kanäle für den Vertrieb der Schuldverschreibungen an professionelle Investoren und geeignete Gegenparteien angemessen sind und (iii) die folgenden Kanäle für den Vertrieb der Schuldverschreibungen an Kleinanleger angemessen sind - Anlageberatung, Portfolio-Management und Verkäufe ohne Beratung. Jede Person, die in der Folge die Schuldverschreibungen anbietet, verkauft oder empfiehlt (jeweils ein Vertriebsunternehmen) soll die Beurteilung des Zielmarkts der Konzepteure berücksichtigen; ein Vertriebsunternehmen, welches MiFID II unterliegt, ist indes dafür verantwortlich, seine eigene Zielmarktbestimmung im Hinblick auf die Schuldverschreibungen durchzuführen (entweder durch die Übernahme oder durch die Präzisierung der Zielmarktbestimmung der Konzepteure) und angemessene Vertriebskanäle nach Maßgabe der Pflichten des Vertriebsunternehmens unter MiFID II im Hinblick auf die Geeignetheit bzw. Angemessenheit, zu bestimmen. Von den angesprochenen Anlegern wird erwartet, dass sie (1) zumindest über fundierte Kenntnisse und/oder Erfahrungen mit Finanzprodukten verfügen, (2) in der Lage sind, zinsbedingte Verluste zu tragen und keine Kapitalverluste hinnehmen müssen, wenn sie bis zur Fälligkeit gehalten werden, (3) ein mittleres Risikoprofil haben, (4) ein allgemeines Kapitalbildungs-/Vermögensoptimierungsziel verfolgen und (5) einen mittelfristigen Anlagehorizont haben. Fresenius Medical Care AG & Co. KGaA ist kein Konzepteur oder ein Vertriebsunternehmen für Zwecke der MiFID Bestimmungen zu Produktüberwachungspflichten.
Singapore – In connection with Section 309B of the Securities and Futures Act 2001 of Singapore (the SFA) and the Securities and Futures (Capital Markets Products) Regulations 2018 of Singapore (the CMP Regulations 2018), the Issuer has determined, and hereby notifies all relevant persons (as defined in Section 309A(1) of the SFA), that the Notes are prescribed capital markets products (as defined in the CMP Regulations 2018) and are Excluded Investment Products (as defined in MAS Notice SFA 04-N12: Notice on the Sale of Investment Products and MAS Notice FAA-N16: Notice on Recommendation on Investment Products).
Singapur – In Verbindung mit Section 309B des Securities and Futures Act 2001 von Singapur (der SFA) und den Securities and Futures (Capital Markets Products) Regulations 2018 von Singapur (die CMP Regulations 2018), hat die Emittentin festgestellt und benachrichtigt hiermit alle relevanten Personen (wie in Section 309A(1) des SFA definiert), dass es sich bei den Schuldverschreibungen um prescribed capital markets products (wie in den CMP Regulations 2018 definiert) und um Excluded Investment Products (wie in der MAS-Mitteilung SFA 04-N12: Notice on the Sale of Investment Products und der MAS Notice FAA-N16: Notice on Recommendation on Investment Products definiert) handelt.
In case of Notes listed on the official list and admitted to trading on the regulated market of the Luxembourg Stock Exchange (Bourse de Luxembourg) or publicly offered in the Grand Duchy of Luxembourg (Luxembourg), the Final Terms of Notes will be displayed on the website of the Luxembourg Stock Exchange (www.bourse.lu). In the case of Notes listed on any other stock exchange or publicly offered in one or more member states of the EEA other than Luxembourg, the Final Terms will be displayed on the website of Fresenius Medical Care (www.freseniusmedicalcare.com).
September 15, 2022
15. September 2022
FINAL TERMS
ENDGÜLTIGE BEDINGUNGEN
Fresenius Medical Care AG & Co. KGaA
EUR 750,000,000 3.875 per cent. Notes due September 20, 2027
EUR 750.000.000 3,875 % Schuldverschreibungen fällig 20. September 2027
Series: 7, Tranche 1
Serien: 7, Tranche 1
issued pursuant to the
begeben aufgrund des
EUR 10,000,000,000
Debt Issuance Program
Dated May 17, 2022
vom 17. Mai 2022
of
der
Fresenius Medical Care AG & Co. KGaA
Issue Price: 99.635 per cent.
Ausgabepreis: 99,635%
Issue Date September 20, 2022
Begebungstag: 20. September 2022
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Important Notice
These are the Final Terms of an issue of Notes under the EUR 10,000,000,000 Debt Issuance Program of Fresenius Medical Care AG & Co. KGaA (the Program). These Final Terms have been prepared for the purpose of Article 8(5) in conjunction with Article 25(4) of the Regulation (EU) 2017/1129 of the European Parliament and of the Council of June 14, 2017, as amended, and must be read in conjunction with the base prospectus dated May 17, 2022 as supplemented by a supplement dated September 9, 2022 (the Prospectus). Full information on Fresenius Medical Care AG & Co. KGaA and the offer of the Notes is only available on the basis of the combination of the Prospectus and these Final Terms. The Prospectus and any supplement thereto are available for viewing in electronic form on the website of the Luxembourg Stock Exchange (www.bourse.lu) and copies may be obtained free of charge at the specified office of the Fiscal Agent.
A summary of the individual issue of the Notes is annexed to these Final Terms.
Wichtiger Hinweis
Diese Endgültigen Bedingungen enthalten Angaben zur Emission von Schuldverschreibungen unter dem EUR 10.000.000.000 Debt Issuance Programm der Fresenius Medical Care AG & Co. KGaA (das Programm). Diese Endgültigen Bedingungen wurden für die Zwecke des Artikels 8 Absatz 5 i.V.m. Artikel 25 Absatz 4 der Verordnung (EU) 2017/1129 des Europäischen Parlaments und des Rates vom 14. Juni 2017, in der jeweils geltenden Fassung, abgefasst und sind in Verbindung mit dem Basisprospekt vom 17. Mai 2022 ergänzt durch den Nachtrag vom 9. September 2022 (der Prospekt) zu lesen. Vollständige Informationen über Fresenius Medical Care AG & Co. KGaA und das Angebot der Schuldverschreibungen sind nur verfügbar, wenn die Endgültigen Bedingungen und der Prospekt zusammengenommen werden. Der Prospekt sowie jeder Nachtrag können in elektronischer Form auf der Internetseite der Luxemburger Börse (www.bourse.lu) eingesehen werden. Kostenlose Kopien sind erhältlich bei dem angegebenen Sitz der Emissionsstelle.
Eine Zusammenfassung der einzelnen Emission der Schuldverschreibungen ist diesen Endgültigen Bedingungen beigefügt.
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Part I.: TERMS AND CONDITIONS
Teil I: EMISSIONSBEDINGUNGEN
The Terms and Conditions applicable to the Notes (the Conditions) and the English language translation thereof, are as set out below.
Die für die Schuldverschreibungen geltenden Emissionsbedingungen (die Bedingungen) sowie die englischsprachige Übersetzung sind wie nachfolgend aufgeführt.
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TERMS AND CONDITIONS | | EMISSIONSBEDINGUNGEN |
§ 1 | | § 1 |
(1) Currency; Denomination. | | (1) Währung; Stückelung. |
This series of Notes (the Notes) of Fresenius Medical Care AG & Co. KGaA (also referred to as the Issuer) is being issued in euro (the Specified Currency) in the aggregate principal amount (subject to § 1(4)) of EUR 750,000,000 (in words: euro seven hundred and fifty million) in the denomination of EUR 1,000 (the Specified Denomination). | | Diese Serie von Schuldverschreibungen (die Schuldverschreibungen) der Fresenius Medical Care AG & Co. KGaA (auch als die Emittentin bezeichnet) wird in Euro (die Festgelegte Währung) im Gesamtnennbetrag (vorbehaltlich § 1(4)) von EUR 750.000.000 (in Worten: Euro siebenhundertfünfzig Millionen) in einer Stückelung von EUR 1.000 (die Festgelegte Stückelung) begeben. |
(2) Form. | | (2) Form. |
The Notes are being issued in bearer form. | | Die Schuldverschreibungen lauten auf den Inhaber. |
(3) Temporary Global Note – Exchange. | | (3) Vorläufige Globalurkunde – Austausch. |
(a) The Notes are initially represented by a temporary global note (the Temporary Global Note) without coupons. The Temporary Global Note will be exchangeable for Notes in Specified Denominations represented by a permanent global note (the Permanent Global Note and together with the Temporary Global Note, the Global Notes) without coupons. The details of such exchange shall be entered in the records of the ICSDs (as defined below). The Global Notes shall each be signed manually by authorized signatories of the Issuer and shall each be authenticated by or on behalf of the Fiscal Agent. Definitive Notes and interest coupons will not be issued. | | (a) Die Schuldverschreibungen sind anfänglich durch eine vorläufige Globalurkunde (die Vorläufige Globalurkunde) ohne Zinsscheine verbrieft. Die Vorläufige Globalurkunde wird gegen Schuldverschreibungen in den Festgelegten Stückelungen, die durch eine Dauerglobalurkunde (die Dauerglobalurkunde und zusammen mit der Vorläufigen Globalurkunde, die Globalurkunden) ohne Zinsscheine verbrieft sind, ausgetauscht. Die Einzelheiten eines solchen Austausches werden in die Aufzeichnungen der ICSDs (wie nachstehend definiert) aufgenommen. Die Globalurkunden tragen jeweils die eigenhändigen Unterschriften ordnungsgemäß bevollmächtigter Vertreter der Emittentin und sind jeweils von der |
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| | Emissionsstelle oder in deren Namen mit einer Kontrollunterschrift versehen. Einzelurkunden und Zinsscheine werden nicht ausgegeben. |
(b) The Temporary Global Note shall be exchanged for the Permanent Global Note on a date (the Exchange Date) not earlier than 40 days after the date of issue of the Notes. Such exchange shall only be made upon delivery of certifications to the effect that the beneficial owner or owners of the Notes is not a U.S. person (other than certain financial institutions or certain persons holding Notes through such financial institutions). Payment of interest on Notes represented by a Temporary Global Note will be made only after delivery of such certifications. A separate certification shall be required in respect of each such payment of interest. Any such certification received on or after the 40th day after the date of issue of the Notes will be treated as a request to exchange the Temporary Global Note pursuant to subparagraph (b) of this § 1(3). Any Notes delivered in exchange for the Temporary Global Note shall be delivered only outside of the United States (as defined in § 1(6)). | | (b) Die Vorläufige Globalurkunde wird an einem Tag (der Austauschtag) gegen die Dauerglobalurkunde ausgetauscht, der nicht weniger als 40 Tage nach dem Tag der Begebung der Schuldverschreibungen liegt. Ein solcher Austausch darf nur nach Vorlage von Bescheinigungen erfolgen, wonach der oder die wirtschaftlichen Eigentümer der Schuldverschreibungen keine U.S.-Personen sind (ausgenommen bestimmte Finanzinstitute oder bestimmte Personen, die Schuldverschreibungen über solche Finanzinstitute halten). Solange die Schuldverschreibungen durch eine Vorläufige Globalurkunde verbrieft sind, werden Zinszahlungen erst nach Vorlage dieser Bescheinigungen vorgenommen. Eine gesonderte Bescheinigung ist für jede solche Zinszahlung erforderlich. Jede Bescheinigung, die am oder nach dem 40. Tag nach dem Tag der Begebung der Schuldverschreibungen eingeht, wird als ein Ersuchen behandelt werden, diese Vorläufige Globalurkunde gemäß Absatz (b) dieses § 1(3) auszutauschen. Schuldverschreibungen, die im Austausch für die Vorläufige Globalurkunde geliefert werden, dürfen nur außerhalb der Vereinigten Staaten (wie in § 1(6) definiert) geliefert werden. |
(4) Clearing System. | | (4) Clearingsystem. |
Each Global Note will be kept in custody by or on behalf of the Clearing System until all obligations of the Issuer under the Notes | | Die Globalurkunde wird solange von einem oder im Namen eines Clearingsystems verwahrt, bis sämtliche Verbindlichkeiten |
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have been satisfied. Clearing System means each of the following: Clearstream Banking S.A. Luxembourg (CBL) and Euroclear Bank SA/NV Brussels as operator of the Euroclear System (Euroclear) and any successor in such capacity. International Central Securities Depositary or ICSD means each of CBL and Euroclear (together, the ICSDs). | | der Emittentin aus den Schuldverschreibungen erfüllt sind. Clearingsystem bedeutet jeweils folgendes: Clearstream Banking S.A., Luxemburg (CBL) und Euroclear Bank SA/NV Brüssel, als Betreiberin des Euroclear Systems (Euroclear) sowie jeder Funktionsnachfolger. International Central Securities Depositary oder ICSD bezeichnet jeweils CBL und Euroclear (zusammen die ICSDs). |
The Notes are issued in new global note (NGN) form and are kept in custody by a common safekeeper on behalf of both ICSDs. | | Die Schuldverschreibungen werden in Form einer New Global Note (NGN) ausgegeben und von einer gemeinsamen Verwahrstelle im Namen beider ICSDs verwahrt. |
The principal amount of Notes represented by the Global Note shall be the aggregate amount from time to time entered in the records of both ICSDs. The records of the ICSDs (which expression means the records that each ICSD holds for its customers which reflect the amount of such customer's interest in the Notes) shall be conclusive evidence of the principal amount of Notes represented by the Global Note and, for these purposes, a statement issued by an ICSD stating the principal amount of Notes so represented at any time shall be conclusive evidence of the records of the relevant ICSD at that time. | | Der Nennbetrag der durch die Globalurkunde verbrieften Schuldverschreibungen entspricht dem jeweils in den Registern beider ICSDs eingetragenen Gesamtbetrag. Die Register der ICSDs (unter denen man die Register versteht, die jeder ICSD für seine Kunden über den Betrag ihres Anteils an den Schuldverschreibungen führt) sind schlüssiger Nachweis über den Nennbetrag der durch die Globalurkunde verbrieften Schuldverschreibungen und eine zu diesen Zwecken von einem ICSD jeweils ausgestellte Bestätigung mit dem Nennbetrag der so verbrieften Schuldverschreibungen ist zu jedem Zeitpunkt ein schlüssiger Nachweis über den Inhalt des Registers des jeweiligen ICSD. |
On any redemption or payment of interest being made in respect of, or purchase and cancellation of, any of the Notes represented by the Global Note the Issuer shall procure that details of any redemption, payment or purchase and cancellation (as the case may be) in respect of the Global Note shall be entered pro rata in the records of the ICSDs and, upon any such entry being made, the principal amount of the Notes recorded in the records of the ICSDs and represented by the Global Note shall be reduced by the | | Bei Rückzahlung oder Zinszahlung bezüglich der durch die Globalurkunde verbrieften Schuldverschreibungen bzw. bei Kauf und Entwertung der durch die Globalurkunde verbrieften Schuldverschreibungen stellt die Emittentin sicher, dass die Einzelheiten über jede Rückzahlung und Zahlung bzw. Kauf und Löschung bezüglich der Globalurkunden pro rata in die Unterlagen der ICSDs eingetragen werden, und nach dieser Eintragung vom Nennbetrag der in die Register der ICSDs aufgenommenen und durch die Globalurkunde verbrieften |
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aggregate principal amount of the Notes so redeemed or purchased and cancelled. | | Schuldschreibungen der Gesamtnennbetrag der zurückgezahlten bzw. gekauften und entwerteten Schuldverschreibungen abgezogen wird. |
On an exchange of a portion only of the Notes represented by a Temporary Global Note, the Issuer shall procure that details of such exchange shall be entered pro rata in the records of the ICSDs. | | Bei Austausch nur eines Teils von Schuldverschreibungen, die durch eine Vorläufige Globalurkunde verbrieft sind, wird die Emittentin sicherstellen, dass die Einzelheiten dieses Austauschs pro rata in die Register der ICSDs aufgenommen werden. |
(5) Holder of Notes. | | (5) Gläubiger von Schuldverschreibungen. |
Holder means any holder of a proportionate co-ownership or other beneficial interest or right in the Notes. | | Gläubiger bedeutet jeder Inhaber eines Miteigentumsanteils oder anderen vergleichbaren Rechts an den Schuldverschreibungen. |
(6) United States. | | (6) Vereinigte Staaten. |
For the purposes of these Terms and Conditions, United States means the United States of America (including the States thereof and the District of Columbia) and its territories and possessions (including Puerto Rico, the U.S. Virgin Islands, Guam, American Samoa, Wake Island and Northern Mariana Islands). | | Für die Zwecke dieser Emissionsbedingungen bezeichnet Vereinigte Staaten die Vereinigten Staaten von Amerika (einschließlich deren Bundesstaaten und des District of Columbia) sowie deren Territorien und Besitztümer (einschließlich Puerto Rico, der U.S. Virgin Islands, Guam, American Samoa, Wake Island und Northern Mariana Islands). |
§ 2 | | § 2 |
(1) Status. | | (1) Status. |
The obligations under the Notes constitute unsecured and unsubordinated obligations of the Issuer ranking pari passu among themselves and pari passu with all other present or future unsecured and unsubordinated obligations of the Issuer, unless such obligations are accorded priority under mandatory provisions of statutory law. | | Die Schuldverschreibungen begründen nicht besicherte und nicht nachrangige Verbindlichkeiten der Emittentin, die untereinander und mit allen anderen gegenwärtigen und künftigen nicht besicherten und nicht nachrangigen Verbindlichkeiten der Emittentin gleichrangig sind, soweit diesen Verbindlichkeiten nicht durch zwingende |
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| | gesetzliche Bestimmungen ein Vorrang eingeräumt wird. |
(2) Negative Pledge. | | (2) Negativverpflichtung. |
So long as any of the Notes remain outstanding, but only up to the time all amounts of principal and interest have been placed at the disposal of the Fiscal Agent, the Issuer undertakes (i) not to grant or permit to subsist any mortgage, land charge, lien or any other security right in rem (dingliches Sicherungsrecht) (the Security Interest) over any or all of its present or future assets, as security for any present or future Capital Market Indebtedness and (ii) to procure, to the extent legally possible, that none of its Subsidiaries will grant or permit to subsist any Security Interest over any or all of its present or future assets, as security for any present or future Capital Market Indebtedness, without at the same time having the Holders share equally and ratably in such Security Interest. This undertaking shall not apply with respect to any Security Interest which (i) is provided over any of the Issuer's claims or claims of any of its Subsidiaries against any affiliated companies within the meaning of sections 15 et seqq. of the German Stock Corporation Act (Aktiengesetz) or any third party, which claims exist now or arise at any time in the future, as a result of the passing on of the proceeds from the sale by the issuer of any securities, provided that any such security serves to secure obligations under such securities issued by the Issuer or by any of its Subsidiaries, (ii) is existing on assets at the time of the acquisition thereof by the Issuer or by any of its Subsidiaries or is existing over assets of a newly acquired company which becomes a member of the Fresenius Medical Care Group, (iii) is existing on the issue date of the Notes, (iv) secures a Capital Market Indebtedness existing at the time of acquisition that becomes an obligation of the Issuer or of any company within the Fresenius Medical | | Die Emittentin verpflichtet sich, solange Schuldverschreibungen ausstehen, jedoch nur bis zu dem Zeitpunkt, an dem alle Beträge an Kapital und Zinsen der Emissionsstelle zur Verfügung gestellt worden sind, (i) keine Grundpfandrechte, Pfandrechte oder sonstigen dinglichen Sicherungsrechte (ein Sicherungsrecht) an gegenwärtigen oder zukünftigen Teilen ihres Vermögens oder ihres Vermögens insgesamt zur Sicherung der gegenwärtigen oder zukünftigen Kapitalmarktverbindlichkeiten zu bestellen oder fortbestehen zu lassen, und (ii) soweit rechtlich möglich, zu veranlassen, dass keine ihrer Tochtergesellschaften Sicherungsrechte an gegenwärtigen oder zukünftigen Teilen ihres Vermögens oder ihres Vermögens insgesamt zur Sicherung der gegenwärtigen oder zukünftigen Kapitalmarktverbindlichkeiten bestellt oder fortbestehen lässt, ohne jeweils die Gläubiger zur gleichen Zeit auf gleiche Weise und anteilig an diesen Sicherungsrechten teilhaben zu lassen. Diese Verpflichtung gilt nicht in Bezug auf Sicherungsrechte, die (i) an gegenwärtigen oder zukünftigen Ansprüchen der Emittentin oder Ansprüchen einer ihrer Tochtergesellschaften gegen verbundene Unternehmen im Sinne der §§ 15 ff. Aktiengesetz oder gegen Dritte aufgrund von einer Übertragung von Erlösen aus dem Verkauf von Wertpapieren bestehen, soweit diese Sicherheiten zur Sicherung von Verpflichtungen aus diesen durch die Emittentin oder durch eine ihrer Tochtergesellschaften ausgegebenen Wertpapieren dienen, (ii) zur Sicherung von Vermögensgegenständen bestellt sind, die bereits zum Zeitpunkt ihres Erwerbs durch die Emittentin oder durch eine ihrer Tochtergesellschaften bestanden, oder am Vermögen einer neu erworbenen |
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Care Group as a consequence of such acquisition, provided that such Capital Market Indebtedness was not created in contemplation of such acquisition (v) is mandatory pursuant to applicable laws or required as a prerequisite for obtaining any governmental approvals, (vi) is provided in connection with any issuance of asset backed securities by the Issuer or by any of its Subsidiaries, (vii) is provided in respect of any issuance of asset backed securities made by a special purpose vehicle where the Issuer or any of its Subsidiaries is the originator of the underlying assets, (viii) is provided in connection with the renewal, extension or replacement of any security pursuant to foregoing (i) through (vii) and, (ix) secures Capital Market Indebtedness the principal amount of which (when aggregated with the principal amount of any other Capital Market Indebtedness which has the benefit of a security other than any permitted under the subparagraphs (i) to (viii) above) does not exceed EUR 100,000,000 (or its equivalent in other currencies at any time). | | Gesellschaft bestehen, die Mitglied des Fresenius Medical Care-Konzerns wird, (iii) zum Ausgabetag der Schuldverschreibungen bestehen, (iv) eine im Zeitpunkt einer Akquisition bestehende Kapitalmarktverbindlichkeit besichern, die infolge der Akquisition eine Verpflichtung der Emittentin oder einer Gesellschaft des Fresenius Medical Care-Konzerns wird, sofern diese Kapitalmarktverbindlichkeit nicht im Hinblick auf diese Akquisition begründet wurde, (v) aufgrund anwendbaren Rechts gesetzlich vorgeschriebene Sicherheiten sind oder solche, deren Bestehen eine Voraussetzung zur Erteilung einer behördlichen Genehmigung sind, (vi) im Zusammenhang mit durch die Emittentin oder durch eine ihrer Tochtergesellschaften begebenen Asset Backed Securities (ABS) stehen, (vii) im Zusammenhang mit durch Zweckgesellschaften begebenen Asset Backed Securities (ABS) stehen, bei denen die Emittentin oder eine ihrer Tochtergesellschaften der Originator der zugrundeliegenden Vermögensgegenstände ist, (viii) der Erneuerung, Verlängerung oder dem Austausch irgendeiner Sicherheit gemäß vorstehend (i) bis (vii) dienen und (ix) Kapitalmarktverbindlichkeiten besichern, deren Kapitalbetrag (bei Aufaddierung auf den Kapitalbetrag sonstiger Kapitalmarktverbindlichkeiten, für die andere Sicherheiten als die nach (i) bis (viii) zulässigen bestehen) EUR 100.000.000 (oder deren jeweiligen Gegenwert in anderen Währungen) nicht überschreitet. |
For purposes of these Terms and Conditions, Capital Market Indebtedness means any obligation for the payment of borrowed money which is evidenced by a certificate of indebtedness (Schuldscheindarlehen) or which is represented by any bond or debt security with an original maturity of more than one year which is, or is intended to be, or is capable of being listed or traded on a stock | | Im Sinne dieser Emissionsbedingungen bezeichnet Kapitalmarktverbindlichkeit jede Verbindlichkeit zur Rückzahlung aufgenommener Geldbeträge, die durch Schuldscheindarlehen dokumentiert ist oder durch Schuldverschreibungen oder sonstige Wertpapiere mit einer ursprünglichen Laufzeit von mehr als einem Jahr, die an einer Börse oder an einem anderen anerkannten Wertpapiermarkt |
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exchange or other recognized securities market. | | zugelassen oder gehandelt werden oder zugelassen oder gehandelt werden können, verbrieft, verkörpert oder dokumentiert ist. |
Fresenius Medical Care Group means Fresenius Medical Care AG & Co. KGaA and its Subsidiaries on a consolidated basis. | | Fresenius Medical Care-Konzern bezeichnet Fresenius Medical Care AG & Co. KGaA und ihre Tochtergesellschaften auf konsolidierter Basis. |
Subsidiary means, with respect to any Person, any corporation, limited liability company, association, partnership or other business entity whose results of operations are consolidated in accordance with IFRS with those of: | | Tochtergesellschaft bezeichnet in Bezug auf einen Rechtsträger, eine Kapitalgesellschaft, eine Gesellschaft mit Haftungsbeschränkung, eine Vereinigung, eine Personengesellschaft oder ein sonstiges Unternehmen, deren bzw. dessen Ergebnisse gemäß den IFRS mit den Ergebnissen folgender Personen konsolidiert werden: |
(a) such Person; | | (a) dieses Rechtsträgers; |
(b) such Person and one or more Subsidiaries of such Person; or | | (b) dieses Rechtsträgers und einer oder mehreren Tochtergesellschaften dieses Rechtsträgers; oder |
(c) one or more Subsidiaries of such Person. | | (c) einer oder mehrerer Tochtergesellschaften dieses Rechtsträgers. |
IFRS refers to International Financial Reporting Standards of the International Accounting Standards Board, as adopted by the European Union. | | IFRS bezeichnet die International Financial Reporting Standards des International Account Standards Board, wie sie von der Europäischen Union anerkannt werden. |
(3) Guarantee. | | (3) Garantie. |
Fresenius Medical Care Holdings, Inc. (the Guarantor) has given an unconditional and irrevocable guarantee (the Guarantee) for the due and punctual payment of principal of, and interest on, and any other amounts payable under any Notes. The Guarantee constitutes a contract for the benefit of the Holders from time to time as third party beneficiaries in accordance with § 328 paragraph 1 of the German Civil Code | | Fresenius Medical Care Holdings, Inc. (die Garantiegeberin) hat eine unbedingte und unwiderrufliche Garantie (die Garantie) für die ordnungsgemäße und pünktliche Zahlung von Kapital und Zinsen und allen anderen zu zahlenden Beträgen unter den Schuldverschreibungen übernommen. Die Garantie stellt einen Vertrag zugunsten der Gläubiger als begünstigte Dritte im Sinne des § 328 Absatz 1 BGB dar, der jedem Gläubiger das Recht gibt, Erfüllung der in der Garantie übernommenen Verpflichtungen unmittelbar von der |
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(Bürgerliches Gesetzbuch)1, giving rise to the right of each Holder to require performance of the Guarantee directly from the Guarantor and to enforce the Guarantee directly against the Guarantor. Copies of the Guarantee may be obtained free of charge at the specified office of the Fiscal Agent. | | Garantiegeberin zu verlangen und diese Verpflichtungen unmittelbar gegen die Garantiegeberin durchzusetzen. Kopien der Garantie können kostenlos bei der bezeichneten Geschäftsstelle der Emissionsstelle bezogen werden. |
(4) Release of Guarantee. | | (4) Freigabe der Garantie. |
Pursuant to its terms, the Guarantee (but not any payment obligation under the Guarantee which has already become due and payable) will be automatically and unconditionally released (and thereupon shall terminate and be discharged and be of no further force and effect) at any time when the Guarantor is no longer an Obligor under the Syndicated Credit Facility (as defined below), provided that, if under the Syndicated Credit Facility, a new guarantee is granted, the Issuer will procure that substantially the same guarantee will also be granted in respect of the obligations under the Notes for the benefit of the Holders. | | Gemäß ihren Bestimmungen wird die Garantie (aber keine Zahlungsverpflichtung im Rahmen der Garantie, die bereits fällig und zahlbar geworden ist) automatisch und unbedingt freigegeben (und gilt von diesem Zeitpunkt an als erloschen und unwirksam), sobald die Garantiegeberin nicht mehr Verpflichtete unter der Syndizierten Kreditlinie ist, wobei, sollte unter der syndizierten Kreditlinie (wie nachstehend definiert) eine neue Garantie gestellt werden, die Emittentin sicherstellen wird, dass eine Garantie zu den im Wesentlichen gleichen Bedingungen auch in Ansehung der Schuldverschreibungen zugunsten der Gläubiger gestellt wird. |
Syndicated Credit Facility means the syndicated credit facility dated as of July 1, 2021 among the Issuer and the Guarantor as borrowers and guarantors, Bank of America Europe DAC as administrative agent and the lenders named therein, (as amended, restated, modified, extended, renewed and/or supplemented or as refinanced or replaced from time to time). | | Syndizierte Kreditlinie bedeutet die syndizierte Kreditlinie vom 1. Juli 2021 zwischen der Emittentin, der Garantiegeberin als Kreditnehmer und Garanten, der Bank of America Europe DAC, als Verwaltungsagent und den darin genannten Kreditgebern (in der jeweils gültigen Fassung, angepasst, modifiziert, erweitert, erneuert und/oder ergänzt oder refinanziert oder ersetzt). |
(5) In case of a release of the Guarantee, the Issuer will notify the Holders pursuant to § 12. | | (5) Im Fall einer Freigabe der Garantie wird die Emittentin dies den Gläubigern gemäß § 12 mitteilen. |
1 | An English language convenience translation of § 328 paragraph 1 BGB (German Civil Code) reads as follows: A contract may stipulate performance for the benefit of a third party, to the effect that the third party acquires the right directly to demand performance. |
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§ 3 | | § 3 |
(1) Rate of Interest and Interest Payment Dates. | | (1) Zinssatz und Zinszahlungstage. |
The Notes shall bear interest on their Specified Denomination at the rate of 3.875% per annum from (and including) September 20, 2022 to (but excluding) the Maturity Date (as defined in § 5(1)). Interest shall be payable in arrears on September 20 in each year (each such date, an Interest Payment Date). The first payment of interest shall be made on September 20, 2023. | | Die Schuldverschreibungen werden bezogen auf ihre Festgelegte Stückelung verzinst, und zwar vom 20. September 2022 (einschließlich) bis zum Fälligkeitstag (wie in § 5(1) definiert) (ausschließlich) mit jährlich 3,875%. Die Zinsen sind nachträglich am 20. September eines jeden Jahres zahlbar (jeweils ein Zinszahlungstag). Die erste Zinszahlung erfolgt am 20. September 2023. |
(2) Accrual of Interest. | | (2) Auflaufende Zinsen. |
The Notes shall cease to bear interest from the expiry of the day preceding the day on which they are due for redemption. If the Issuer for any reason fails to redeem the Notes when due, interest shall continue to accrue at the default rate of interest established by statutory law2 on the outstanding aggregate principal amount of the Notes from (and including) the due date to (but excluding) the day on which such redemption payment is made to the Holders. | | Der Zinslauf der Schuldverschreibungen endet mit Ablauf des Tages, der dem Tag vorangeht, an dem sie zur Rückzahlung fällig werden. Falls die Emittentin die Schuldverschreibungen bei Fälligkeit aus irgendeinem Grund nicht zurückzahlt, wird der ausstehende Gesamtnennbetrag der Schuldverschreibungen von dem Tag der Fälligkeit (einschließlich) bis zum Tag der vollständigen Rückzahlung an die Gläubiger (ausschließlich) mit dem gesetzlich bestimmten Verzugszins3 verzinst. |
(3) Calculation of Interest for Periods other than a full Year. | | (3) Berechnung der Zinsen für Zeiträume, die nicht einem vollen Jahr entsprechen. |
If interest is to be calculated for a period other than a full year, it shall be calculated on the basis of the Day Count Fraction (as defined below). The number of Interest Payment Dates per calendar year (each a Determination Date) is one. | | Sofern Zinsen für einen Zeitraum, der nicht einem vollen Jahr entspricht, zu berechnen sind, erfolgt die Berechnung auf der Grundlage des Zinstagequotienten (wie nachfolgend definiert). Die Anzahl der Zinszahlungstage im Kalenderjahr (jeweils ein Feststellungstermin) beträgt Eins. |
2 | The default rate of interest established by statutory law is five percentage points above the basis rate of interest published by Deutsche Bundesbank from time to time, §§ 288 paragraph 1, 247 paragraph 1 of the German Civil Code. |
3 | Der gesetzliche Verzugszinssatz beträgt für das Jahr fünf Prozentpunkte über dem von der Deutsche Bundesbank von Zeit zu Zeit veröffentlichten Basiszinssatz, §§ 288 Absatz 1, 247 Absatz 1 BGB. |
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Determination Period means the period from (and including) a Determination Date to, (but excluding) the next Determination Date. For the purpose of determining the relevant Determination Period, September 20, 2022 shall be deemed to be a Determination Date. | | Feststellungsperiode ist die Periode ab einem Feststellungstermin (einschließlich desselben) bis zum nächsten Feststellungstermin (ausschließlich desselben). Zum Zwecke der Bestimmung der maßgeblichen Feststellungsperiode ist der 20. September 2022 ein Feststellungstermin. |
§ 4 | | § 4 |
(1) Payment of Principal and Payment of Interest. | | (1) Zahlungen auf Kapital und Zahlung von Zinsen. |
(a) Payment of principal in respect of the Notes shall be made, subject to subparagraph (2) below, to the Clearing System or to its order for credit to the accounts of the relevant account holders of the Clearing System. | | (a) Zahlungen von Kapital auf die Schuldverschreibungen erfolgen nach Maßgabe des nachstehenden Absatzes (2) an das Clearingsystem oder dessen Order zur Gutschrift auf den Konten der jeweiligen Kontoinhaber des Clearingsystems. |
(b) Payment of Interest on the Notes shall be made, subject to subparagraph (2), to the Clearing System or to its order for credit to the accounts of the relevant account holders of the Clearing System. | | (b) Die Zahlung von Zinsen auf die Schuldverschreibungen erfolgt nach Maßgabe des nachstehenden Absatzes (2) an das Clearingsystem oder dessen Order zur Gutschrift auf den Konten der jeweiligen Kontoinhaber des Clearingsystems. |
Payment of interest on Notes represented by the Temporary Global Note shall be made, subject to subparagraph (2), to the Clearing System or to its order for credit to the accounts of the relevant account holders of the Clearing System, upon due certification as provided in § 1(3)(b). | | Die Zahlung von Zinsen auf Schuldverschreibungen, die durch die Vorläufige Globalurkunde verbrieft sind, erfolgt nach Maßgabe des nachstehenden Absatzes (2) an das Clearingsystem oder dessen Order zur Gutschrift auf den Konten der jeweiligen Kontoinhaber des Clearingsystems, und zwar nach ordnungsgemäßer Bescheinigung gemäß § 1(3)(b). |
(2) Manner of Payment. | | (2) Zahlungsweise. |
Subject to applicable fiscal and other laws and regulations, payments of amounts due in respect of the Notes shall be made in the Specified Currency. | | Vorbehaltlich geltender steuerlicher und sonstiger gesetzlicher Regelungen und Vorschriften erfolgen zu leistende Zahlungen auf die Schuldverschreibungen in der Festgelegten Währung. |
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twelve months after the Maturity Date, even though such Holders may not be in default of acceptance of payment. If and to the extent that the deposit is effected and the right of withdrawal is waived, the respective claims of such Holders against the Issuer shall cease. | | innerhalb von zwölf Monaten nach dem Fälligkeitstag beansprucht worden sind, auch wenn die Gläubiger sich nicht in Annahmeverzug befinden. Soweit eine solche Hinterlegung erfolgt, und auf das Recht der Rücknahme verzichtet wird, erlöschen die diesbezüglichen Ansprüche der Gläubiger gegen die Emittentin. |
§ 5 | | § 5 |
(1) Final Redemption. | | (1) Rückzahlung bei Endfälligkeit. |
Unless previously redeemed in whole or in part or purchased and cancelled, the Notes shall be redeemed at their principal amount on September 20, 2027 (the Maturity Date). | | Soweit nicht zuvor bereits ganz oder teilweise zurückgezahlt oder angekauft und entwertet, werden die Schuldverschreibungen zu ihrem Nennbetrag am 20. September 2027 (der Fälligkeitstag) zurückgezahlt. |
(2) Early Redemption at the option of the Issuer for Reasons of Taxation. | | (2) Vorzeitige Rückzahlung nach Wahl der Emittentin aus steuerlichen Gründen. |
If as a result of any change in, or amendment to, the laws, treaties, regulations or official position of any Relevant Taxing Jurisdiction (as defined in § 7 herein) or any political subdivision or taxing authority thereto or therein affecting taxation or the obligation to pay duties of any kind, or any change in, or amendment to, an official interpretation or application of such laws or regulations, which amendment or change is effective on or after the date on which the series of Notes was issued, the Issuer or the Guarantor, as the case may be, is required to pay Additional Amounts (as defined in § 7 herein) on the next succeeding Interest Payment Date (as defined in § 3(1)), and this obligation cannot be avoided by the use of reasonable measures available to the Issuer or the Guarantor, as the case may be, the Notes may be redeemed, in whole but not in part, at the option of the Issuer, upon not more than 60 days' nor less than 30 days' prior notice of redemption given to the Fiscal Agent and, in accordance with § 12 to | | Die Schuldverschreibungen können insgesamt, jedoch nicht teilweise, nach Wahl der Emittentin mit einer Kündigungsfrist von nicht mehr als 60 und nicht weniger als 30 Tagen durch Erklärung gegenüber der Emissionsstelle und Benachrichtigung gemäß § 12 gegenüber den Gläubigern vorzeitig gekündigt und zu ihrem Nennbetrag zuzüglich etwaiger bis zum für die Rückzahlung festgesetzten Tag (ausschließlich) aufgelaufener Zinsen zurückgezahlt werden, falls die Emittentin oder die Garantiegeberin als Folge einer Änderung oder Ergänzung der Steuer- oder Abgabengesetze, -abkommen, |
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the Holders, at their principal amount, together with interest (if any) accrued to the date fixed for redemption (excluding). | | oder nach dem Tag, an dem die Serie von Schuldverschreibungen begeben wird, wirksam) am nächstfolgenden Zinszahlungstag (wie in § 3(1) definiert) zur Zahlung von Zusätzlichen Beträgen (wie in § 7 dieser Bedingungen definiert) verpflichtet sein wird und diese Verpflichtung nicht durch das Ergreifen zumutbarer, der Emittentin oder der Garantiegeberin zur Verfügung stehender Maßnahmen vermieden werden kann. |
However, no such notice of redemption may be given (i) earlier than 90 days prior to the earliest date on which the Issuer or the Guarantor would be obligated to pay such Additional Amounts were a payment in respect of the Notes then due, or (ii) if at the time such notice is given, such obligation to pay such Additional Amounts does not remain in effect. | | Eine solche Kündigung darf allerdings nicht (i) früher als 90 Tage vor dem frühestmöglichen Termin erfolgen, an dem die Emittentin oder die Garantiegeberin verpflichtet wäre, solche Zusätzlichen Beträge zu zahlen, falls eine Zahlung auf die Schuldverschreibungen dann fällig sein würde, oder (ii) erfolgen, wenn zu dem Zeitpunkt, zu dem die Kündigung erklärt wird, die Verpflichtung zur Zahlung von Zusätzlichen Beträgen nicht mehr wirksam ist. |
Any such notice shall be given in accordance with § 12. It shall be irrevocable, must specify the date fixed for redemption and must set forth a statement in summary form of the facts constituting the basis for the right of the Issuer so to redeem. | | Eine solche Kündigung ist gemäß § 12 bekanntzumachen. Sie ist unwiderruflich, muss den für die Rückzahlung festgelegten Termin nennen und eine zusammenfassende Erklärung enthalten, welche die das Rückzahlungsrecht der Emittentin begründenden Umständen darlegt. |
Before the publication of any notice of redemption pursuant to this subparagraph, the Issuer shall deliver to the Fiscal Agent a certificate signed by a member of the managing board of the general partner of the Issuer stating that the Issuer is entitled to effect such redemption and setting forth a statement of facts showing that the conditions precedent to the right of the Issuer so to redeem have occurred, and an opinion of independent legal counsel or tax advisers of recognized standing to the effect that the Issuer or the Guarantor, as the case may be, has or will become obliged | | Vor Bekanntgabe einer Mitteilung über eine Rückzahlung gemäß diesen Bestimmungen hat die Emittentin der Emissionsstelle eine von einem Mitglied des Vorstands des Komplementärs der Emittentin unterzeichnete Bescheinigung zukommen zu lassen, der zufolge die Emittentin berechtigt ist, eine entsprechende Rückzahlung zu leisten, und in der nachvollziehbar dargelegt ist, dass die Bedingungen für das Recht der Emittentin zur Rückzahlung gemäß diesen Bestimmungen erfüllt sind; zusätzlich hat die Emittentin ein von unabhängigen und anerkannten Rechts- oder Steuerberatern erstelltes Gutachten vorzulegen, |
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to pay such Additional Amounts as a result of such change or amendment. | | demzufolge die Emittentin oder die Garantiegeberin in Folge einer entsprechenden Änderung oder Ergänzung zur Zahlung Zusätzlicher Beträge verpflichtet ist oder sein wird. |
(3) Early Redemption at the Option of the Issuer for Reasons of Minimal Outstanding Principal Amount. | | (3) Vorzeitige Rückzahlung nach Wahl der Emittentin bei geringfügigem ausstehendem Nennbetrag. |
If 80% or more in principal amount of the Notes then outstanding have been redeemed or purchased by the Issuer or any Subsidiary of Fresenius Medical Care AG & Co. KGaA, the Issuer may, on not less than 30 or more than 60 days' notice to the Holders redeem, at its option, the remaining Notes as a whole at their principal amount, together with interest (if any) accrued to the date fixed for redemption (excluding). | | Wenn 80% oder mehr des Nennbetrags der dann ausstehenden Schuldverschreibungen durch die Emittentin oder eine Tochtergesellschaft der Fresenius Medical Care AG & Co. KGaA zurückgezahlt oder zurückerworben wurde, ist die Emittentin berechtigt, nach ihrer Wahl alle ausstehenden Schuldverschreibungen mit einer Frist von mindestens 30 und höchstens 60 Tagen gegenüber den Gläubigern zu kündigen und zum Nennbetrag zuzüglich etwaiger bis zum Rückzahlungstag (ausschließlich) aufgelaufener Zinsen zurück zu zahlen. |
(4) Early Redemption at the Option of the Holders upon a Change of Control. | | (4) Vorzeitige Rückzahlung nach Wahl der Gläubiger bei Vorliegen eines Kontrollwechsels. |
Each Holder of the Notes, upon the occurrence of a Change of Control Triggering Event, will have the right (unless, prior to the giving of the Put Event Notice referred to below, the Issuer gives notice to redeem the Notes in accordance with § 5(2), i.e. for taxation reasons) to require that the Issuer repurchases such Holder's Notes on the Optional Redemption Date at a purchase price in cash equal to 101% of the principal amount together with interest (if any) accrued to the Optional Redemption Date (excluding). | | Falls ein Kontrollwechselereignis stattfindet, hat jeder Gläubiger das Recht (soweit die Emittentin nicht bereits vor Abgabe der Vorzeitigen Rückkaufsgrunderklärung (wie nachstehend definiert) die Rückzahlung gemäß § 5(2), d.h. aus steuerlichen Gründen, erklärt hat) von der Emittentin am Stichtag den Rückkauf seiner Schuldverschreibungen zu einem Kaufpreis von 101% des Nennbetrags zuzüglich etwaiger bis zum Stichtag (ausschließlich) aufgelaufener Zinsen zu verlangen. |
In this context the following provisions apply: | | In diesem Zusammenhang finden die folgenden Vorschriften Anwendung: |
Change of Control Triggering Event means the occurrence of a Change of Control together with a Ratings Decline. | | Ein Kontrollwechselereignis liegt vor, wenn ein Kontrollwechsel zusammen mit einer Ratingherabstufung eintreten. |
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Rating Agency means (1) S&P Global Ratings Europe Limited and its subsidiaries or successors (S&P), (2) Moody's Deutschland GmbH and its subsidiaries or successors (Moody's), and (3) Fitch Ratings Ireland Limited and its subsidiaries or successors (Fitch), or (4) if S&P, Moody's or Fitch, or all three shall not make rating of Fresenius Medical Care AG & Co. KGaA publicly available, a European-wide reputable securities rating agency or agencies, as the case may be, selected by Fresenius Medical Care AG & Co. KGaA, which shall be substituted for S&P, Moody's or Fitch or all three, as the case may be. | | Ratingagentur bezeichnet (1) S&P Global Ratings Europe Limited sowie deren Tochter- oder Nachfolgergesellschaften (S&P), (2) Moody's Deutschland GmbH sowie deren Tochter- oder Nachfolgergesellschaften (Moody's), (3) Fitch Ratings Ireland Limited sowie deren Tochter- oder Nachfolgergesellschaften (Fitch), oder (4) falls S&P, Moody's oder Fitch oder alle drei kein Rating für Fresenius Medical Care AG & Co. KGaA öffentlich zur Verfügung stellen, eine Ratingagentur oder Ratingagenturen mit europaweitem Ansehen, die von Fresenius Medical Care AG & Co. KGaA ausgewählt wird und S&P, Moody's oder Fitch oder alle diese Agenturen ersetzt. |
Ratings Decline means that if (a), at the time of the occurrence of a Change of Control, Fresenius Medical Care AG & Co. KGaA's (i) has been, rated Investment Grade by at least two Rating Agencies and such rating is, within 120 days from such time, either downgraded to a non-investment grade rating or withdrawn by at least two Rating Agencies and is not within such 120-day period subsequently (in the case of a downgrade) upgraded to Investment Grade by two of the three Rating Agencies, or (in the case of withdrawal) replaced by an Investment Grade rating from any other Rating Agency or Rating Agencies; or (ii) rated below Investment Grade and such rating from any Rating Agency is, within 120 days from such time, downgraded by one or more gradations (including gradations within Rating Categories as well as between Rating Categories) and is not within such 120-day period subsequently upgraded to its earlier credit rating or better by such Rating Agency, provided that if at the time of the occurrence of a Change of Control Fresenius Medical Care AG & Co. KGaA carries an Investment Grade rating of only one Rating Agency, it shall be sufficient if the requirements under sub-paragraph (i) are met with respect to such Rating Agency; | | Eine Ratingherabstufung liegt vor, falls (a) Fresenius Medical Care AG & Co. KGaA bei Eintritt des Kontrollwechsels (i) von mindestens zwei Ratingagenturen mit Investment Grade bewertet ist und diese Ratings von mindestens zwei Ratingagenturen innerhalb von 120 Tagen nach dem Kontrollwechsel zu einem Non-Investment-Grade-Rating herabgestuft oder das Rating zurückgezogen wurde und nicht innerhalb dieser 120-Tagesperiode anschließend (im Falle einer Herabstufung) durch mindestens zwei Ratingagenturen wieder auf ein Investment Grade Rating heraufgestuft oder (im Falle eines Zurückziehens) durch das Investment Grade Rating einer anderen Ratingagentur oder Ratingagenturen ersetzt wurde; oder (ii) unterhalb von Investment Grade bewertet ist und dieses Rating von einer Ratingagentur innerhalb von 120 Tagen nach dem Kontrollwechsel um eine oder mehrere Stufen (einschließlich Untergliederungen innerhalb von sowie zwischen Ratingkategorien) herabgestuft und nicht innerhalb dieser 120-Tagesperiode anschließend wieder auf das ursprüngliche oder ein besseres Rating durch diese Ratingagentur heraufgestuft wurde, wobei, falls Fresenius Medical Care AG & Co. KGaA zum Eintritt des |
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and (b) in making any of the decisions referred to above, the relevant Rating Agency announces publicly or confirms in writing to Fresenius Medical Care AG & Co. KGaA that its decision resulted, in whole or in part, from the occurrence of the Change of Control. | | Kontrollwechsels über ein Investment-Grade-Rating von nur einer Ratingagentur verfügt, es bereits ausreichend ist, wenn die Voraussetzungen in Unterabsatz (i) im Hinblick auf diese Ratingagentur erfüllt sind; und (b) im Zusammenhang mit einer der oben genannten Entscheidungen die betreffende Ratingagentur öffentlich bekannt macht oder gegenüber Fresenius Medical Care AG & Co. KGaA schriftlich bestätigt, dass ihre Entscheidung ganz oder teilweise auf den Kontrollwechsel zurückzuführen ist. |
Provided however that, no Ratings Decline will occur if at the end of the 120-day period Fresenius Medical Care AG & Co. KGaA has been rated by at least two Rating Agencies, it has solicited, Investment Grade. | | Eine Ratingherabstufung liegt jedoch nicht vor, falls Fresenius Medical Care AG & Co. KGaA (aufgrund einer Beauftragung durch Fresenius Medical Care AG & Co. KGaA) am Ende der 120-Tagesperiode von mindestens zwei Ratingagenturen mit Investment Grade bewertet wird. |
Rating Category means: | | Ratingkategorie bezeichnet: |
(a) with respect to S&P or Fitch, any of the following categories: BB, B, CCC, CC, C and D (or equivalent successor categories); | | (a) in Bezug auf S&P oder Fitch eine der folgenden Kategorien: BB, B, CCC, CC, C und D (bzw. entsprechende Nachfolgekategorien; |
(b) with respect to Moody's, any of the following categories: Ba, B, Caa, Ca, C and D (or equivalent successor categories); and | | (b) in Bezug auf Moody's eine der folgenden Kategorien: Ba, B, Caa, Ca, C und D (bzw. entsprechende Nachfolgekategorien); und |
(c) the equivalent of any such category of S&P, Moody's or Fitch used by another rating agency in determining whether the rating of Fresenius Medical Care AG & Co. KGaA has decreased by one or more gradations, gradations within rating categories ("+" and "-" for S&P, "1", "2" and "3" for Moody's, "+" and "-" for Fitch; or the equivalent gradations for another rating agency) shall be taken into account (e.g., with respect to S&P, a decline in a rating from "BB+" to "BB", as well as from "BB-" to "B+", will | | (c) diesen Kategorien von S&P oder Moody's oder Fitch entsprechende Ratingkategorien einer anderen Ratingagentur. Bei der Bestimmung, ob das Rating von Fresenius Medical Care AG & Co. KGaA um eine oder mehrere Stufen herabgestuft wurde, werden die jeweiligen Ratingkategorien weiter untergliedernde Zusätze ("+" und "-" bei S&P, "1", "2" und "3" bei Moody's, "+" und "-" bei Fitch bzw. entsprechende Zusätze anderer Ratingagenturen) berücksichtigt (z. B. entspricht bei S&P eine |
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constitute a decrease of one gradation). | | Ratingänderung von "BB+" auf "BB" oder von "BB-" auf "B+" jeweils einer Herabstufung um eine Stufe). |
Investment Grade means a rating of (i) "BBB-" or higher by S&P and Fitch, and (ii) "Baa3" or higher by Moody's, or the equivalent of such ratings by S&P, Moody's or Fitch and the equivalent in respect of rating categories of any Rating Agencies substituted for S&P, Moody's or Fitch. | | Investment Grade bezeichnet ein Rating von (i) "BBB-" oder höher im Fall von S&P und Fitch und (ii) "Baa3" oder höher im Fall von Moody's, oder das entsprechende Äquivalent dieser Ratings im Fall von S&P, Moody's oder Fitch sowie das entsprechende Äquivalent in den Ratingkategorien einer anderen Ratingagentur, durch die S&P, Moody's oder Fitch ersetzt wurde. |
A Change of Control means the occurrence of one or more of the following events: | | Ein Kontrollwechsel bezeichnet den Eintritt eines oder mehrerer der folgenden Ereignisse: |
(a) so long as Fresenius Medical Care AG & Co. KGaA is organized as a KGaA, if the General Partner of Fresenius Medical Care AG & Co. KGaA charged with the management of Fresenius Medical Care AG & Co. KGaA shall at any time fail to be Fresenius SE & Co. KGaA or a subsidiary of Fresenius SE & Co. KGaA, or if Fresenius SE & Co. KGaA shall fail at any time to own or control, directly or indirectly, more than 25 % of the capital stock with ordinary voting power in Fresenius Medical Care AG & Co. KGaA; | | (a) so lange Fresenius Medical Care AG & Co. KGaA die Rechtsform einer KGaA hat: Wenn es sich bei dem mit der Geschäftsführung von Fresenius Medical Care AG & Co. KGaA beauftragten Komplementär der Gesellschaft zu irgendeinem Zeitpunkt nicht um Fresenius SE & Co. KGaA oder eine Tochtergesellschaft der Fresenius SE & Co. KGaA handelt oder wenn Fresenius SE & Co. KGaA zu irgendeinem Zeitpunkt direkt oder indirekt nicht mehr als 25 % des stimmberechtigten Grundkapitals an Fresenius Medical Care AG & Co. KGaA hält und kontrolliert; |
(b) if Fresenius Medical Care AG & Co. KGaA is no longer organized as a KGaA, any event the result of which is that (A) any person or group (Relevant Person(s)) acting in concert (as defined in § 30 (2) of the German Securities Acquisition and Takeover Act (Wertpapiererwerbs- und Übernahmegesetz)) or any person or group acting on behalf of any such Relevant Person(s), other than a Permitted Holder, is or becomes the direct or indirect legal | | (b) wenn Fresenius Medical Care AG & Co. KGaA nicht mehr die Rechtsform einer KGaA hat, ein Ereignis, in dessen Folge (A) eine Person oder mehrere Personen (Relevante Personen), die abgestimmt handeln (wie in § 30 (2) Wertpapiererwerbs- und Übernahmegesetz definiert), oder einer oder mehrere Dritte, die im Auftrag einer solchen Relevanten Personen handeln, mit Ausnahme eines Zulässigen Inhabers, unmittelbar oder mittelbar |
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or beneficial ownership or any legal or beneficial entitlement (as defined in § 34 of the German Securities Trading Act (Wertpapierhandelsgesetz)) of, in the aggregate, more than 50% of the voting shares of Fresenius Medical Care AG & Co. KGaA; or | | rechtliches oder wirtschaftliches Eigentum in jedweder Form bzw. die unmittelbare oder mittelbare rechtliche oder wirtschaftliche Verfügungsbefugnis in jedweder Form (wie in § 34 Wertpapierhandelsgesetz beschrieben) an insgesamt mehr als 50% der stimmberechtigten Aktien der Fresenius Medical Care AG & Co. KGaA erlangen; oder |
(c) any sale, lease, exchange or other transfer (in one transaction or a series of related transactions) of all or substantially all of the assets of Fresenius Medical Care AG & Co. KGaA (held directly or indirectly) to any Relevant Person other than a Permitted Holder, or any person or group acting on behalf of any such Relevant Person(s). | | (c) ein Verkauf, ein Leasing, ein Tausch oder eine sonstige Übertragung (im Rahmen einer einzigen Transaktion oder einer Reihe miteinander zusammenhängender Transaktionen) aller oder aller wesentlichen Vermögenswerte (direkt oder indirekt gehalten) der Fresenius Medical Care AG & Co. KGaA an eine oder mehrere Relevante Personen, mit Ausnahme eines Zulässigen Inhabers, oder einen oder mehrere Dritte, die im Auftrag solcher Relevanten Personen handeln. |
General Partner means Fresenius Medical Care Management AG, a stock corporation organized under the laws of Germany, including its successors and assigns and other Persons, in each case who serve as the general partner (persönlich haftender Gesellschafter) of Fresenius Medical Care AG & Co. KGaA from time to time. | | Komplementär bezeichnet die Fresenius Medical Care Management AG, eine Aktiengesellschaft nach deutschem Recht, sowie ihre Nachfolger, Abtretungsempfänger und sonstige Personen, die zum jeweiligen Zeitpunkt als persönlich haftender Gesellschafter von Fresenius Medical Care AG & Co. KGaA auftreten. |
Person means any individual, corporation, partnership, joint venture, association, joint-stock company, trust, unincorporated organization, government or any agency, instrumentality or political subdivision thereof, or any other entity. | | Person bezeichnet eine natürliche Person, eine Körperschaft, eine Personengesellschaft, ein Joint Venture, eine Vereinigung, eine Aktiengesellschaft, einen Trust, eine Einrichtung ohne eigene Rechtspersönlichkeit, eine staatliche Stelle oder Behörde, eine Gebietskörperschaft oder einen sonstigen Rechtsträger. |
Permitted Holder means Fresenius SE & Co. KGaA and any of its Affiliates, as long as and to the extent Fresenius SE & Co. KGaA or the | | Zulässiger Inhaber bezeichnet die Fresenius SE & Co. KGaA und alle mit ihr verbundenen Personen, sofern und soweit |
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relevant Affiliate(s) is or are not acting in concert with, or on behalf of, a Relevant Person(s). | | die Fresenius SE & Co. KGaA oder eine oder mehrere mit ihr verbundene Person(en) nicht gemeinsam mit oder im Auftrag einer oder mehrerer Relevanten Person(en) handeln. |
Affiliate of any specified Person means: | | Verbundene Person einer bestimmten Person bezeichnet: |
(a) any other Person, directly or indirectly, controlling or controlled by such specified Person, or | | (a) jede andere Person, die diese Person direkt oder indirekt kontrolliert bzw. direkt oder indirekt von ihr kontrolliert wird, oder |
(b) under direct or indirect common control with such specified Person. | | (b) mit dieser bestimmten Person unter direkter oder indirekter gemeinsamer Kontrolle steht. |
For the purposes of this definition, "control" when used with respect to any Person means the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise (section 15 of the German Stock Corporation Act (Aktiengesetz); and the terms "controlling" and "controlled" have meanings correlative to the foregoing. | | Für den Zweck dieser Definition bezeichnet "Kontrolle" bei Verwendung in Bezug auf eine Person die Befugnis, deren Geschäftsführung und Unternehmenspolitik direkt oder indirekt zu bestimmen (§ 15 Aktiengesetz), sei es durch den Besitz von stimmberechtigten Kapitalanteilen, eine vertragliche Festlegung oder anderweitig, und die Bedeutung der Begriffe "kontrolliert" und "kontrollieren" ist entsprechend zu verstehen. |
Within 30 days upon the Issuer becoming aware that a Change of Control Triggering Event has occurred, the Issuer shall give notice (a Put Event Notice) to the Holders in accordance with § 12 stating: | | Innerhalb von 30 Tagen, nachdem die Emittentin von einem Kontrollwechselereignis Kenntnis erlangt hat, wird die Emittentin dies den Gläubigern gemäß § 12 bekannt machen (Vorzeitige Rückkaufsgrunderklärung) und dabei folgendes mitteilen: |
(a) that a Change of Control Triggering Event has occurred; | | (a) dass ein Kontrollwechselereignis eingetreten ist; |
(b) the circumstances and relevant facts regarding such Change of Control Triggering Event; | | (b) die Umstände und relevanten Informationen bezüglich des Kontrollwechselereignisses; |
(c) the repurchase date (which shall be no earlier than 30 days nor later than 60 days from the date such Put Event | | (c) den Tag des Rückkaufs (der nicht früher als 30 und nicht später als 60 Tage nach dem Tag, an dem die |
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Notice is given) (the Optional Redemption Date); | | Vorzeitige Rückkaufsgrunderklärung erfolgt, liegen darf) (der Stichtag); |
(d) that each Note will be subject to repurchase only in integral multiples of the Specified Denomination; and | | (d) dass die Schuldverschreibungen nur in ganzen Vielfachen der Festgelegten Stückelung zurückgekauft werden; und |
(e) the instructions determined by the Issuer that a Holder must follow in order to have its Notes purchased pursuant to this § 5(4). | | (e) die Anweisungen, die ein Gläubiger befolgen muss, damit die Schuldverschreibungen gemäß diesem § 5(4) zurückgekauft werden. |
In order to exercise such option, the Holder must submit during normal business hours at the specified office of the Fiscal Agent a duly completed option exercise notice in the form available from the specified office of the Fiscal Agent within the period of 20 days after a Put Event Notice is given. No option so exercised may be revoked or withdrawn without the prior consent of the Issuer. | | Um ein solches Recht auszuüben, muss ein Gläubiger während der allgemeinen Geschäftszeiten bei der angegebenen Geschäftsstelle der Emissionsstelle eine vollständig ausgefüllte Ausübungserklärung in der durch die Emissionsstelle bereitgestellten Form innerhalb eines Zeitraums von 20 Tagen nach Bekanntmachung der Vorzeitigen Rückzahlungserklärung übermitteln. Kein in dieser Form ausgeübtes Recht kann ohne vorherige Zustimmung der Emittentin widerrufen oder zurückgezogen werden. |
The Issuer will comply with the requirements of any applicable securities laws or regulations in connection with an early redemption of Notes at the option of the Holders upon a Change of Control pursuant to this § 5(4). To the extent that the provisions of any securities laws or regulations or applicable stock exchange listing rules conflict with the provisions of this § 5(4), the Issuer will comply with the applicable securities laws, regulations and listing rules and will not be deemed to have breached its obligations under this § 5(4) by virtue thereof. | | Die Emittentin wird die Anforderungen der anwendbaren Wertpapiergesetze oder |
(5) Early Redemption at the Option of the Issuer. | | (5) Vorzeitige Rückzahlung nach Wahl der Emittentin. |
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(a) The Issuer may, upon notice given in accordance with clause (b), redeem all or some only of the Notes within the Call Redemption Period(s) at the Call Redemption Amount(s) set forth below together with accrued interest, if any, to (but excluding) the relevant redemption date. | | (a)Die Emittentin kann, nachdem sie gemäß Absatz (b) gekündigt hat, die Schuldverschreibungen insgesamt oder teilweise innerhalb des/der Wahl- Rückzahlungszeitraums/-räume (Call) zum/zu den Wahl- Rückzahlungsbetrag/-beträgen (Call), wie nachfolgend angegeben, nebst etwaigen bis zum maßgeblichen Rückzahlungstag (ausschließlich) aufgelaufenen Zinsen zurückzahlen. |
Call Redemption Period(s) | Call Redemption Amount(s) | | Wahl-Rückzahlungszeitraum/-räume | Wahl-Rückzahlungsbetrag/-beträge |
August 20, 2027 to September 19, 2027 | 100 percent of the principal amount | | 20. August 2027 bis | 100% des |
(b) Notice of redemption shall be given by the Issuer to the Holders of the Notes in accordance with § 12. Such notice shall specify: | | (b) Die Kündigung ist den Gläubigern der Schuldverschreibungen durch die Emittentin gemäß § 12 bekanntzugeben. Sie muss die folgenden Angaben enthalten: |
(i) the series of Notes subject to redemption; | | (i) die zurückzuzahlende Serie von Schuldverschreibungen; |
(ii) whether such series is to be redeemed in whole or in part only and, if in part only, the aggregate principal amount of the Notes which are to be redeemed; | | (ii) eine Erklärung, ob diese Serie ganz oder teilweise zurückgezahlt wird und im letzteren Fall den Gesamtnennbetrag der zurückzuzahlenden Schuldverschreibungen; |
(iii) the relevant redemption date, which shall be not less than 20 nor more than 40 days after the date on which notice is given by the Issuer to the Holders; and | | (iii) den maßgeblichen Rückzahlungstag, der nicht weniger als 20 und nicht mehr als 40 Tage nach dem Tag der Kündigung durch die Emittentin gegenüber den Gläubigern liegen darf; und |
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Fiscal Agent or any Paying Agent and to appoint another Fiscal Agent or additional or other Paying Agents. The Issuer shall at all times maintain (i) a Fiscal Agent, (ii) so long as the Notes are listed on the Luxembourg Stock Exchange, a Paying Agent (which may be the Fiscal Agent) with a specified office in Luxembourg and/or in such other place as may be required by the rules of such stock exchange and (iii) a Paying Agent in an EU Member State, if possible, that will not be obliged to withhold or deduct tax in connection with any payment made in relation to the Notes unless the Paying Agent would be so obliged in each other EU Member State if it were located there. Any variation, termination, appointment or change shall only take effect (other than in the case of insolvency, when it shall be of immediate effect) after not less than 30 nor more than 45 days' prior notice thereof shall have been given to the Holders in accordance with § 12. | | oder einer Zahlstelle zu ändern oder zu beenden und eine andere Emissionsstelle oder zusätzliche oder andere Zahlstellen zu bestellen. Die Emittentin wird zu jedem Zeitpunkt (i) eine Emissionsstelle unterhalten, (ii) solange die Schuldverschreibungen an der Luxemburger Börse notiert sind, eine Zahlstelle (die die Emissionsstelle sein kann) mit bezeichneter Geschäftsstelle in Luxemburg und/oder an solchen anderen Orten unterhalten, die die Regeln dieser Börse verlangen und (iii) eine Zahlstelle in einem Mitgliedsstaat der Europäischen Union, sofern dies möglich ist, unterhalten, die nicht zum Einbehalt oder Abzug von Quellensteuern oder sonstigen Abzügen verpflichtet ist, es sei denn, dass eine solche Einbehalts- oder Abzugspflicht auch in allen anderen Mitgliedsstaaten der Europäischen Union bestünde. Eine Änderung, Abberufung, Bestellung oder ein sonstiger Wechsel wird nur wirksam (außer im Insolvenzfall, in dem eine solche Änderung sofort wirksam wird), sofern die Gläubiger hierüber gemäß § 12 vorab unter Einhaltung einer Frist von mindestens 30 und nicht mehr als 45 Tagen informiert wurden. |
(3) Agent of the Issuer. | | (3) Erfüllungsgehilfe(n) der Emittentin. |
The Fiscal Agent and the Paying Agent act solely as the agents of the Issuer and the Guarantor and do not assume any obligations towards or relationship of agency or trust for any Holder. | | Die Emissionsstelle und die Zahlstelle handeln ausschließlich als Erfüllungsgehilfen der Emittentin und der Garantiegeberin und übernehmen keinerlei Verpflichtungen gegenüber den Gläubigern und es wird kein Auftrags- oder Treuhandverhältnis zwischen ihnen und den Gläubigern begründet. |
§ 7 | | § 7 |
All payments of principal and interest made by the Issuer in respect of the Notes to the Holders shall be made free and clear of, and without withholding or deduction for, any present or future taxes or duties of whatever nature imposed or levied by way of deduction or withholding by or on behalf of (1) the Federal Republic of Germany or any authority | | Alle in Bezug auf die Schuldverschreibungen von der Emittentin an die Gläubiger zahlbaren Kapital- oder Zinsbeträge werden ohne Einbehalt oder Abzug an der Quelle für oder wegen gegenwärtiger oder zukünftiger Steuern oder Abgaben gleich welcher Art gezahlt, die von oder im Namen (1) der Bundesrepublik Deutschland oder einer dort zur |
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therein or thereof having power to tax, (2) any jurisdiction from or through which payment on the Notes or the Guarantee is made, or any political subdivision or governmental authority thereof or therein having the power to tax and/or (3) any other jurisdiction in which the payor is organized or otherwise considered to be resident or doing business for tax purposes, or any political subdivision or governmental authority thereof or therein having the power to tax (each a Relevant Taxing Jurisdiction), unless such deduction or withholding is required by law. In that event the Issuer shall pay such additional amounts (the Additional Amounts) as shall result in receipt by the Holders of such amounts as would have been received by them had no such withholding or deduction been required, except that no Additional Amounts shall be payable with respect to: | | Steuererhebung ermächtigten Behörde, (2) einer Rechtsordnung, aus der bzw. über die eine Zahlung auf die Schuldverschreibungen oder die Garantie geleistet wird, oder einer dort zur Steuererhebung ermächtigten Gebietskörperschaft oder Behörde, und/oder (3) einer anderen Rechtsordnung, in der die zahlende Partei errichtet ist oder anderweitig als gebietsansässig gilt oder im steuerlichen Sinn geschäftlich tätig ist, oder einer dort zur Steuererhebung ermächtigten Gebietskörperschaft oder Behörde (jeweils eine Relevante Steuerjurisdiktion) im Wege des Abzugs oder Einbehalts auferlegt oder erhoben werden, es sei denn, ein solcher Abzug oder Einbehalt ist gesetzlich vorgeschrieben. In diesem Fall wird die Emittentin diejenigen zusätzlichen Beträge (Zusätzliche Beträge) zahlen, die erforderlich sind, damit die den Gläubigern zufließenden Nettobeträge nach diesem Einbehalt oder Abzug jeweils den Beträgen an Kapital und Zinsen entsprechen, die ohne einen solchen Einbehalt oder Abzug von den Gläubigern erhalten worden wären; jedoch sind solche Zusätzlichen Beträge nicht zu zahlen in Bezug auf: |
(a) taxes or duties which are payable by any Person acting as custodian bank or collecting agent on behalf of a Holder, or otherwise in any manner which does not constitute a deduction or withholding by the Issuer or the Guarantor, as applicable, from payments of principal or interest made by it; or | | (a) Steuern oder Abgaben, die von einer als Depotbank oder Inkassobeauftragter eines Gläubigers handelnden Person oder auf eine sonstige Weise zu entrichten sind, die keinen Abzug oder Einbehalt von Zahlungen von Kapital oder Zinsen durch die Emittentin bzw. die Garantiegeberin darstellen; oder |
(b) payments that would not have been so imposed but for the existence of any present or former connection between such Holder (or between a fiduciary, settlor, beneficiary, member or shareholder of, or a person having a controlling power over, such Holder) and any Relevant Taxing Jurisdiction including, without limitation, such Holder (or such fiduciary, settlor, beneficiary, member, shareholder or person having such a controlling power) being or having been a citizen or resident or treated as a resident of, | | (b) Zahlungen, die nicht erhoben worden wären, wenn nicht (i) eine gegenwärtige oder ehemalige Beziehung zwischen dem betreffenden Gläubiger (oder einem Treuhänder, Treugeber, Begünstigten, Mitglied oder Gesellschafter dieses Gläubigers oder einer Person, die beherrschenden Einfluss auf diesen Gläubiger hat) und einer Relevanten Steuerjurisdiktion bestehen würde, unter anderem in der Form, dass der betreffende Gläubiger (bzw. Treuhänder, Treugeber, Begünstigte, Mitglied, |
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being or having been engaged in a trade or business in, or having or having had a permanent establishment in, a Relevant Taxing Jurisdiction other than any connections arising solely from a Holder acquiring, holding or disposing of, receiving any payment under or with respect to or enforcing a Note or any Guarantee; or | | Gesellschafter oder die Person, die beherrschenden Einfluss hat) Staatsbürger einer Relevanten Steuerjurisdiktion ist oder war oder dort ansässig ist oder war oder als dort ansässig gilt oder galt oder dort ein Gewerbe oder eine Geschäftstätigkeit betreibt oder betrieben hat oder dort eine Betriebsstätte unterhält oder unterhalten hat, mit Ausnahme von Beziehungen, die allein dadurch entstehen, dass ein Gläubiger eine Schuldverschreibung oder die Garantie erwirbt, hält oder veräußert bzw. eine Zahlung darunter oder in Bezug auf diese erhält oder Ansprüche darauf geltend macht; oder |
(c) payments to, or to a third party on behalf of, a Holder where no such withholding or deduction would have been required to be made if the Notes were credited at the time of payment to a securities deposit account with a bank, financial services institution, securities trading business or securities trading bank, in each case outside the Relevant Taxing Jurisdiction; or | | (c) Zahlungen an den Gläubiger oder an einen Dritten für den Gläubiger, falls kein Einbehalt oder Abzug hätte erfolgen müssen, wenn die Schuldverschreibung zum Zeitpunkt der fraglichen Zahlung einem Depotkonto bei einer bzw. einem nicht in der Relevanten Steuerjurisdiktion ansässigen Bank, Finanzdienstleistungsinstitut, Wertpapierhandelsunternehmen oder Wertpapierhandelsbank gutgeschrieben gewesen wäre; oder |
(d) payments where such withholding or deduction is imposed pursuant to (i) any European Union Directive or Regulation concerning the taxation of savings, or (ii) any international treaty or understanding relating to such taxation and to which the Relevant Taxing Jurisdiction or the European Union is a party/are parties, or (iii) any provision of law implementing, or complying with, or introduced to conform with, such Directive, Regulation, treaty or understanding, or (iv) the Luxembourg law of 23 December 2005; or | | (d) falls der Einbehalt oder Abzug gemäß (i) einer Richtlinie oder Verordnung der Europäischen Union zur Zinsbesteuerung oder (ii) einem internationalen Abkommen oder Übereinkommen zu einer solchen Besteuerung, bei dem die Relevante Steuerjurisdiktion oder die Europäische Union Parteien sind, oder (iii) einem diese Richtlinie oder Verordnung oder dieses Abkommen oder Übereinkommen umsetzenden oder sie befolgenden oder zu ihrer Befolgung erlassenen Gesetz, oder |
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| | (iv) dem Luxemburger Gesetz vom 23. Dezember 2005 erhoben wird; oder |
(e) payments to the extent such withholding or deduction is payable by or on behalf of a Holder who could lawfully mitigate (but has not so mitigated) such withholding or deduction by complying or procuring that any third party complies with any statutory requirements or by making or procuring that a third party makes a declaration of non-residence or other similar claim for exemption to any tax authority in the place where the payment is effected (including, in the case of a payment by a Paying Agent situated in the United States, by providing prior to the receipt of any such payment, a complete, correct and executed IRS Form W-8 or W-9 or successor form, as applicable, with all appropriate attachments); or | | (e) soweit der Einbehalt oder Abzug von dem Gläubiger oder von einem Dritten für den Gläubiger zahlbar ist, der einen solchen Einbehalt oder Abzug dadurch rechtmäßigerweise hätte vermindern können (aber nicht vermindert hat), dass er gesetzliche Vorschriften beachtet, oder dafür sorgt, dass Dritte dieses tun, oder dadurch dass er eine Nichtansässigkeitserklärung oder einen ähnlichen Antrag auf Quellensteuerbefreiung gegenüber der am Zahlungsort zuständigen Steuerbehörde; abgibt oder dafür sorgt, dass dies durch einen Dritten erfolgt (einschließlich, im Falle einer Zahlung durch eine Zahlstelle mit Sitz in den Vereinigten Staaten, durch Bereitstellung eines vollständigen, korrekten und ausgefüllten IRS-Formulars W-8 oder W-9 oder eines Nachfolgeformulars, falls zutreffend, mit allen entsprechenden Anlagen); oder |
(f) payments to the extent such withholding or deduction is payable by or on behalf of a Holder who would have been able to mitigate such withholding or deduction by effecting a payment via another Paying Agent in a Member State of the European Union, not obliged to withhold or deduct tax; or | | (f) soweit der Einbehalt oder Abzug von dem Gläubiger oder von einem Dritten für den Gläubiger vorzunehmen ist, der einen solchen Einbehalt oder Abzug durch die Bewirkung einer Zahlung über eine andere Zahlstelle in einem Mitgliedsstaat der Europäischen Union, welche nicht zu einem solchen Einbehalt oder Abzug verpflichtet ist, hätte vermindern können; oder |
(g) payments to the extent such withholding or deduction is for or on account of the presentation by the Holder of any Note for payment on a date more than 30 days after the date on which such payment became due and payable or the date on which | | (g) soweit der Einbehalt oder Abzug für einen Gläubiger oder dessen Rechnung vorzunehmen ist, der Schuldverschreibungen mehr als 30 Tage nach dem Tag, an dem eine Zahlung unter den Schuldverschreibungen fällig und zahlbar wurde bzw., soweit dies später eintritt, nach dem Tag, an dem |
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payment thereof is duly provided for, whichever occurs later; or | | die Zahlung ordnungsgemäß vorgenommen wurde, vorgelegt hat; oder |
(h) payments to the extent such withholding or deduction is required pursuant to Sections 1471 through 1474 of the U.S. Internal Revenue Code of 1986, as amended (the Internal Revenue Code), or any amended or successor version thereof, any current or future regulations or official interpretations thereof, any agreement entered into pursuant to Section 1471(b) of the Internal Revenue Code, or any fiscal or regulatory legislation, rules or practices adopted pursuant to any intergovernmental agreement entered into in connection with the implementation of such Sections of the Internal Revenue Code; or | | (h) soweit der Einbehalt oder Abzug gemäß §§ 1471 bis 1474 des U.S. Internal Revenue Code von 1986 in seiner jeweils gültigen Fassung (der Internal Revenue Code), oder einer geänderten oder nachfolgenden Fassung davon, jeder gegenwärtigen oder zukünftigen Verordnung oder offiziellen Auslegung davon, jeder Vereinbarung, die gemäß § 1471(b) des Internal Revenue Codes eingegangen wurde oder jeder steuerlichen oder regulatorischen Gesetzgebung, sowie steuerlichen und regulatorischen Gesetzen oder Vorgehensweisen, die nach einem völkerrechtlichen Vertrag, der zur Umsetzung der Bestimmungen des Internal Revenue Codes geschlossen wurde, vorzunehmen ist; oder |
(i) any tax imposed on interest by the United States or any political subdivision or governmental authority thereof or therein by reason of any Holder holding or owning, actually or constructively, 10% or more of the total combined voting power of all classes of stock of the Issuer or the Guarantor entitled to vote; or | | (i) jede Steuer, die von den Vereinigten Staaten oder einer ihrer politischen Unterabteilungen oder Regierungsbehörden auf Zinsen erhoben wird, weil ein Inhaber tatsächlich oder konstruktiv 10 % oder mehr der gesamten kombinierten Stimmrechte aller Aktiengattungen der Emittentin oder der Garantiegeberin hält oder besitzt; oder |
(j) any tax imposed on interest by the United States or any political subdivision or governmental authority thereof or therein by reason of any Holder being a controlled foreign corporation that is a related person within the meaning of Section 864(d)(4) of the Internal Revenue Code with respect to the Issuer or the Guarantor; or | | (j) jede Steuer, die von den Vereinigten Staaten oder einer politischen Unterabteilung oder Regierungsbehörde der Vereinigten Staaten oder darin erhoben wird, weil ein Inhaber eine kontrollierte ausländische Körperschaft ist, die eine verwandte Person im Sinne von § 864(d)(4) des Internal Revenue Code in Bezug auf die Emittentin oder die Garantiegeberin ist; oder |
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(Abgeltungsteuer), to be deducted or withheld pursuant to the German Income Tax Act, even if the deduction or withholding has to be made by the Issuer or its representative, and the German Solidarity Surcharge (Solidaritätszuschlag) or any other tax which may substitute the German capital gains tax (Kapitalertragsteuer) or solidarity surcharge (Solidaritätszuschlag), as the case may be. | | Abgeltungsteuer), die nach dem deutschen Einkommensteuergesetz abgezogen oder einbehalten wird, auch wenn der Abzug oder Einbehalt durch die Emittentin oder ihren Vertreter vorzunehmen ist, und den deutschen Solidaritätszuschlag oder jede andere Steuer, welche die deutsche Kapitalertragsteuer bzw. den Solidaritätszuschlag ersetzen sollte. |
§ 8 | | § 8 |
The presentation period provided in § 801 paragraph 1, sentence 1 BGB (German Civil Code) is reduced to ten years for the Notes. | | Die in § 801 Absatz 1 Satz 1 BGB bestimmte Vorlegungsfrist wird für die Schuldverschreibungen auf zehn Jahre verkürzt. |
§ 9 | | § 9 |
(1) Events of default. | | (1) Kündigungsgründe. |
Each Holder shall be entitled to declare due and payable by notice to the Fiscal Agent its entire claims arising from the Notes and demand immediate redemption thereof at the principal amount together with accrued interest (if any) to (but excluding) the date of repayment, in the event that: | | Jeder Gläubiger ist berechtigt, seine sämtlichen Forderungen aus den Schuldverschreibungen durch Kündigung gegenüber der Emissionsstelle fällig zu stellen und die unverzügliche Rückzahlung zum Nennbetrag, zuzüglich etwaiger bis zum Tag der Rückzahlung (ausschließlich) aufgelaufener Zinsen zu verlangen, falls: |
(a) the Issuer fails to pay principal or interest under the Notes within 30 days from the relevant due date, or | | (a) die Emittentin auf die Schuldverschreibungen Kapital oder Zinsen nicht innerhalb von 30 Tagen nach dem betreffenden Fälligkeitstag zahlt; oder |
(b) the Guarantor fails to pay amounts payable under the Guarantee within 30 days from the relevant due date, or | | (b) die Garantiegeberin auf die Garantie zahlbare Beträge nicht innerhalb von 30 Tagen nach dem Fälligkeitstag zahlt; oder |
(c) the Issuer fails to duly perform any other material obligation arising from the Notes and such failure continues unremedied for more than 60 days after the Fiscal Agent has received a request thereof in the manner set | | (c) die Emittentin die ordnungsgemäße Erfüllung irgendeiner anderen wesentlichen Verpflichtung aus den Schuldverschreibungen unterlässt und die Unterlassung jeweils länger als 60 Tage fortdauert, nachdem die Emissionsstelle eine Aufforderung in der in § 9(3) vorgesehenen Art und |
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forth in § 9(3) from a Holder to perform such obligation; or | | Weise von dem Gläubiger erhalten hat, die Verpflichtung zu erfüllen; oder |
(d) any Capital Market Indebtedness of the Issuer or any of its Material Subsidiaries or the Guarantor (unless the Guarantee has been released in accordance with these Terms and Conditions) becomes prematurely repayable as a result of a default in respect of the terms thereof, or the Issuer or any of its Material Subsidiaries or the Guarantor (unless the Guarantee has been released in accordance with these Terms and Conditions) fails to fulfill any payment obligation in excess of EUR 75,000,000 or the equivalent thereof under any Capital Market Indebtedness or under any guarantees or suretyships given for any Capital Market Indebtedness of others within 30 days from its due date or, in the case of such guarantee or suretyship, within 30 days of such guarantee or suretyship being invoked, unless the Issuer or the relevant Material Subsidiary or the Guarantor contests in good faith that such payment obligation exists or is due or that such guarantee or suretyship has been validly invoked or if a security granted therefor is enforced on behalf of or by the creditor(s) entitled thereto; or | | (d) eine Kapitalmarktverbindlichkeit der Emittentin oder einer ihrer Wesentlichen Tochtergesellschaften oder der Garantiegeberin (es sei denn, die Garantie wurde gemäß diesen Emissionsbedingungen freigegeben) vorzeitig zahlbar wird aufgrund einer Pflichtverletzung aus dem dieser Kapitalmarktverbindlichkeit zugrunde liegenden Vertrag oder die Emittentin oder eine ihrer Wesentlichen Tochtergesellschaften oder die Garantiegeberin (es sei denn, die Garantie wurde gemäß diesen Emissionsbedingungen freigegeben) eine Zahlungsverpflichtung in Höhe oder im Gegenwert von mehr als EUR 75.000.000 aus einer Kapitalmarktverbindlichkeit oder aufgrund einer Bürgschaft oder Garantie, die für Kapitalmarktverbindlichkeiten Dritter gegeben wurde, nicht innerhalb von 30 Tagen nach ihrer Fälligkeit bzw. im Fall einer Bürgschaft oder Garantie nicht innerhalb von 30 Tagen nach Inanspruchnahme aus dieser Bürgschaft oder Garantie erfüllt, es sei denn, die Emittentin oder die betreffende Wesentliche Tochtergesellschaft oder die Garantiegeberin bestreitet in gutem Glauben, dass diese Zahlungsverpflichtung besteht oder fällig ist bzw. diese Bürgschaft oder Garantie berechtigterweise geltend gemacht wird, oder falls eine für solche Verbindlichkeiten bestellte Sicherheit für die oder von den daraus berechtigten Gläubiger(n) in Anspruch genommen wird; oder |
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repudiate, deny or disaffirm any of its obligations thereunder or under the Terms and Conditions. | | unwirksam oder undurchsetzbar erklärt wird, oder die Garantiegeberin eine ihrer Verpflichtungen aus der Garantie oder aus den Emissionsbedingungen zurückweist, leugnet oder ablehnt. |
Material Subsidiary means any Subsidiary of Fresenius Medical Care AG & Co. KGaA which: | | Wesentliche Tochtergesellschaft bezeichnet eine Tochtergesellschaft von Fresenius Medical Care AG & Co. KGaA: |
(a) has unconsolidated EBITDA representing 5% or more of the EBITDA of Fresenius Medical Care AG & Co. KGaA and its subsidiaries on a consolidated basis; or | | (a) deren unkonsolidiertes EBITDA 5% oder mehr des EBITDA der Fresenius Medical Care AG & Co. KGaA und ihrer Tochtergesellschaften auf einer konsolidierten Basis darstellt, oder |
(b) has unconsolidated gross assets representing 5% or more of the gross assets of Fresenius Medical Care AG & Co. KGaA and its subsidiaries on a consolidated basis, | | (b) deren unkonsolidiertes Bruttovermögen 5% oder mehr des Bruttovermögens der Fresenius Medical Care AG & Co. KGaA und ihrer Tochtergesellschaften auf einer konsolidierten Basis darstellt, |
in each case as determined by reference to the latest audited annual financial statements prepared in accordance with IFRS. | | in allen Fällen bestimmt nach dem letzten geprüften Jahresabschluss, die in Übereinstimmung mit IFRS erstellt wurden. |
EBITDA means operating income plus depreciation and amortization and is derived from the operating income determined in accordance with IFRS. | | EBITDA entspricht dem Operativen Ergebnis zuzüglich Abschreibungen und wird von dem nach IFRS ermittelten Operativen Ergebnis abgeleitet. |
(2) No Termination. | | (2) Keine Kündigung. |
The right to declare Notes due shall terminate if the situation giving rise to it has been cured before the right is exercised. No event or circumstance other than an event specified in § 9(1) shall entitle Holders to declare their Notes due and payable prior to their stated maturity save as expressly provided for in these Terms and Conditions and subject to applicable mandatory law. | | Das Kündigungsrecht erlischt, falls der Kündigungsgrund vor Ausübung des Rechts geheilt wurde. Vorbehaltlich anwendbaren zwingenden Rechts berechtigen andere Ereignisse oder Umstände als die in § 9(1) genannten den Gläubiger nicht dazu, seine Schuldverschreibungen vorzeitig zur Rückzahlung fällig zu stellen, es sei denn, dies ist ausdrücklich in diesen Emissionsbedingungen bestimmt. |
(3) Notice. | | (3) Kündigungserklärung. |
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Any default notice in accordance with § 9(1) shall be made at least in text form (section 126b of the German Civil Code, Bürgerliches Gesetzbuch) to the specified office of the Fiscal Agent together with evidence by means of a certificate of the Holder's Custodian (as defined in § 14(3)) that such Holder, at the time of such notice, is a holder of the relevant Notes. | | Eine Kündigungserklärung gemäß § 9(1) hat in der Weise zu erfolgen, dass der Gläubiger bei der angegebenen Geschäftsstelle der Emissionsstelle eine entsprechende Erklärung zumindest in Textform (§ 126 Bürgerliches Gesetzbuch) übergibt und dabei durch eine Bescheinigung seiner Depotbank (wie in § 14(3) definiert) nachweist, dass er die betreffenden Schuldverschreibungen zum Zeitpunkt der Erklärung hält. |
(4) Quorum. | | (4) Quorum. |
In the events specified in subparagraph (1)(c) and/or (d) of this § 9, any notice declaring Notes due shall, unless at the time such notice is received any of the events specified in subparagraph (1) (a), (b) and (e) through (g) of this § 9 entitling Holders to declare their Notes due has occurred, become effective only when the Fiscal Agent has received such default notices from the Holders representing at least 25% of the aggregate principal amount of Notes then outstanding. | | In den Fällen gemäß Absatz (1)(c) und/oder (d) dieses § 9 wird eine Kündigungserklärung, sofern nicht bei deren Eingang zugleich einer der in Absatz (1)(a), (b) und (e) bis (g) dieses § 9 bezeichneten Kündigungsgründe vorliegt, erst wirksam, wenn bei der Emissionsstelle Kündigungserklärungen von Gläubigern im Nennbetrag von mindestens 25% des Gesamtnennbetrages der zu diesem Zeitpunkt noch insgesamt ausstehenden Schuldverschreibungen eingegangen sind. |
§ 10 | | § 10 |
(1) Substitution. | | (1) Ersetzung |
The Issuer (reference to which shall always include any previous Substitute Debtor (as defined below)) may, at any time, if no payment of principal of or interest on any of the Notes is in default, without the consent of the Holders, substitute for the Issuer any Affiliate (as defined below) of Fresenius Medical Care AG & Co. KGaA as the principal debtor in respect of all obligations arising from or in connection with the Notes (any such company, the Substitute Debtor), provided that: | | Die Emittentin (wobei eine Bezugnahme auf die Emittentin auch alle früheren Nachfolgeschuldner (wie nachfolgend definiert) umfasst) ist jederzeit berechtigt, wenn kein Zahlungsverzug hinsichtlich Kapital oder Zinsen auf die Schuldverschreibungen vorliegt, ohne weitere Zustimmung der Gläubiger ein mit der Fresenius Medical Care AG & Co. KGaA verbundenes Unternehmen (wie nachfolgend definiert) an ihrer Stelle als Hauptschuldnerin (ein solches Unternehmen ist die Nachfolgeschuldnerin) für alle Verpflichtungen aus und im Zusammenhang mit den Schuldverschreibungen einzusetzen, vorausgesetzt, dass: |
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in respect of the obligations of the Substitute Debtor, that the Substitute Debtor has obtained all necessary governmental and regulatory approvals and consents for the performance by the Substitute Debtor of its obligations under the Notes, and that all such approvals and consents are in full force and effect and that the obligations assumed by the Substitute Debtor and the Substitution Guarantee given by the Issuer are each valid and binding in accordance with their respective terms and enforceable by each Holder; | | Regierungsstellen und Aufsichtsbehörden erhalten haben, die Nachfolgeschuldnerin alle für die Erfüllung ihrer Verpflichtungen aus den Schuldverschreibungen notwendigen Genehmigungen und Einverständniserklärungen von Regierungsstellen und Aufsichtsbehörden erhalten hat und weiterhin sämtliche dieser Genehmigungen und Einverständniserklärungen in vollem Umfang gültig und wirksam sind und zudem die Verpflichtungen der Nachfolgeschuldnerin und die von der Emittentin begebene Ersetzungsgarantie gemäß ihren Bestimmungen wirksam und rechtsverbindlich und durch jeden Gläubiger durchsetzbar sind; |
(d) § 9 shall be deemed to be amended so that it shall also be an Event of Default under such provision if the Substitution Guarantee shall cease to be valid or binding on or enforceable against Fresenius Medical Care AG & Co. KGaA; | | (d) § 9 dergestalt als ergänzt gilt, dass ein zusätzlicher Kündigungsgrund unter dieser Bestimmung der Wegfall der Wirksamkeit, Rechtsverbindlichkeit oder Durchsetzbarkeit der Ersetzungsgarantie gegen Fresenius Medical Care AG & Co. KGaA ist; |
(e) the Substitute Debtor undertakes to reimburse any Holder for such taxes, fees or duties which may be imposed upon such Holder in connection with any payments on the Notes (including taxes or duties being deducted or withheld at source), upon conversion or otherwise, as a consequence of the assumption of the Issuer's obligations by the Substitute Debtor, provided that such undertaking shall be limited to amounts that would not have been imposed upon the Holder had such substitution not occurred; and | | (e) die Nachfolgeschuldnerin sich verpflichtet, jedem Gläubiger alle Steuern, Gebühren oder Abgaben zu erstatten, die ihm im Zusammenhang mit Zahlungen auf die Schuldverschreibungen (einschließlich Steuern und Abgaben, die an der Quelle abgeführt oder einbehalten wurden), durch den Schuldnerwechsel oder in anderer Weise infolge der Schuldübernahme durch die Nachfolgeschuldnerin auferlegt werden, vorausgesetzt, dass sich die Verpflichtung auf Beträge beschränkt, die der Gläubiger ohne die Ersetzung der Emittentin nicht hätte tragen müssen; und |
(f) there shall have been delivered to the Fiscal Agent one opinion for each jurisdiction affected of lawyers of | | (f) der Emissionsstelle jeweils ein Rechtsgutachten bezüglich der betroffenen Rechtsordnungen von |
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recognized standing to the effect that subparagraphs (a) through (e) above have been satisfied. | | anerkannten Rechtsanwälten vorgelegt wurden, die bestätigen, dass die Bestimmungen in den vorstehenden Unterabsätzen (a) bis (e) erfüllt wurden. |
For purposes of this § 10, Affiliate shall mean any affiliated company (verbundenes Unternehmen) within the meaning of sections 15 et seqq. of the German Stock Corporation Act (Aktiengesetz) held by Fresenius Medical Care AG & Co. KGaA. | | Für Zwecke dieses § 10 bedeutet verbundenes Unternehmen jedes von Fresenius Medical Care AG & Co. KGaA gehaltene verbundene Unternehmen im Sinne der §§ 15 ff. Aktiengesetz. |
(2) Discharge from Obligations. References. | | (2) Schuldbefreiung. Bezugnahmen. |
Upon a substitution in accordance with this § 10, the Substitute Debtor shall be deemed to be named in the Notes as the principal debtor in place of the Issuer as issuer and the Notes shall thereupon be deemed to be amended to give effect to the substitution including that the relevant jurisdiction in relation to the Issuer in § 7 shall be the Substitute Debtor's country of domicile for tax purposes. Furthermore, in the event of such substitution, in § 7 and § 5(2) an alternative reference to the Federal Republic of Germany shall be deemed to have been included in addition to the reference according to the preceding sentence to the country of domicile or residence for taxation purposes of the Substitute Debtor. | | Nach einer Ersetzung gemäß dieses § 10 gilt die Nachfolgeschuldnerin als in den Schuldverschreibungen an Stelle der Emittentin als Hauptschuldnerin bestimmt und die Schuldverschreibungen gelten als dementsprechend ergänzt, um der Ersetzung zur Durchsetzung zu verhelfen, und als die relevante Steuerjurisdiktion in Bezug auf § 7 gilt die Jurisdiktion, in der die Nachfolgeschuldnerin steuerlich ansässig ist. Des Weiteren gilt im Fall einer Ersetzung in § 7 und § 5(2) eine alternative Bezugnahme auf die Bundesrepublik Deutschland als aufgenommen (zusätzlich zu der Bezugnahme nach Maßgabe des vorstehenden Satzes auf das Land, in dem die Nachfolgeschuldnerin ihren Sitz oder Steuersitz hat). |
Any such substitution, together with the notice referred to in subparagraph (3) below, shall, in the case of the substitution of any other company as principal debtor, operate to release the Issuer as issuer from all of its obligations as principal debtor in respect of the Notes. | | Jede Ersetzung zusammen mit der Mitteilung gemäß Absatz 3 dieser Bestimmung befreit, im Fall der Einsetzung einer anderen Gesellschaft als Hauptschuldnerin, die Emittentin von allen Verbindlichkeiten, die sie als Hauptschuldnerin unter den Schuldverschreibungen hatte. |
(3) Notification to Holders. | | (3) Benachrichtigung der Gläubiger. |
Not later than 15 Payment Business Days after effecting the substitution, the Substitute Debtor shall give notice thereof to the Holders and, if any Notes are listed on | | Spätestens 15 Zahltage nach Durchführung der Ersetzung wird die Nachfolgeschuldnerin dies den Gläubigern und, sollten die Schuldverschreibungen an einer Börse |
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any stock exchange, to such stock exchange in accordance with § 12 and to any other person or authority as required by applicable laws or regulations. | | notiert sein, dieser Börse gemäß § 12 mitteilen und jede andere Person oder Stelle, gemäß den anwendbaren Gesetzen und Regelungen informieren. |
§ 11 | | § 11 |
(1) Further Issues. | | (1) Begebung weiterer Schuldverschreibungen. |
The Issuer may from time to time, without the consent of the Holders, issue further Notes having the same terms and conditions as the Notes of this series in all respects (or in all respects except for the issue date, interest commencement date and/or the issue price) so as to form a single series with the Notes of this series. | | Die Emittentin kann ohne Zustimmung der Gläubiger weitere Schuldverschreibungen begeben, die in jeder Hinsicht (gegebenenfalls mit Ausnahme des Tags der Begebung, des Zinslaufbeginns und/oder des Ausgabepreises) die gleichen Bedingungen wie die Schuldverschreibungen dieser Serie haben und die zusammen mit den Schuldverschreibungen dieser Serie eine einheitliche Gesamtemission bilden. |
(2) Purchases. | | (2) Ankauf. |
The Issuer may at any time purchase Notes in the open market or otherwise and at any price. Notes purchased by the Issuer may, at the option of the Issuer, be held, resold or surrendered to the Fiscal Agent for cancellation. If purchases are made by tender, tenders for such Notes must be made available to all Holders of such Notes alike. | | Die Emittentin ist berechtigt, jederzeit Schuldverschreibungen im Markt oder anderweitig zu jedem beliebigen Preis zu kaufen. Die von der Emittentin erworbenen Schuldverschreibungen können nach Wahl der Emittentin von ihr gehalten, weiterverkauft oder bei der Emissionsstelle zwecks Entwertung eingereicht werden. Sofern diese Käufe durch öffentliches Angebot erfolgen, muss dieses Angebot allen Gläubigern gemacht werden. |
(3) Cancellation. | | (3) Entwertung. |
All Notes redeemed in full shall be cancelled forthwith and may not be reissued or resold. | | Sämtliche vollständig zurückgezahlten Schuldverschreibungen sind unverzüglich zu entwerten und können nicht wiederbegeben oder wiederverkauft werden. |
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§ 12 | | § 12 |
(1) Publication. | | (1) Bekanntmachung. |
As long as the Notes are listed on the official list of the Luxembourg Stock Exchange and admitted to trading on the regulated market of the Luxembourg Stock Exchange (and as long as the rules and regulations of the Luxembourg Stock Exchange so require), all notices concerning the Notes will be made by means of electronic publication on the internet website of the Luxembourg Stock Exchange (www.bourse.lu). Any notice will be deemed to have been validly given on the third day following the date of such publication (or, if published more than once, on the third day following the date of the first such publication). | | Solange Schuldverschreibungen im amtlichen Kursblatt (official list) der Luxemburger Börse notiert und zum Handel am regulierten Markt der Luxemburger Börse zugelassen sind (und die Vorschriften der Luxemburger Börse dies verlangen), sind alle die Schuldverschreibungen betreffenden Mitteilungen auf der Internetseite der Luxemburger Börse (www.bourse.lu) zu veröffentlichen. Jede derartige Mitteilung gilt mit dem dritten Tag nach dem Tag der Veröffentlichung (oder bei mehreren Veröffentlichungen mit dem dritten Tag nach dem Tag der ersten solchen Veröffentlichung) als wirksam erfolgt. |
(2) Notification to Clearing System. | | (2) Mitteilungen an das Clearingsystem. |
So long as any Notes are listed on the official list of the Luxembourg Stock Exchange and admitted to trading on the regulated market of the Luxembourg Stock Exchange, subparagraph (1) shall apply. If the Rules of the Luxembourg Stock Exchange otherwise so permit, the Issuer may deliver the relevant notice to the Clearing System for communication by the Clearing System to the Holders, in lieu of publication as set forth in subparagraph (1) above; any such notice shall be deemed to have been given on the seventh day after the day on which the said notice was given to the Clearing System. | | Solange Schuldverschreibungen im amtlichen Kursblatt (official list) der Luxemburger Börse notiert und zum Handel am regulierten Markt der Luxemburger Börse zugelassen sind, sind alle die Schuldverschreibungen betreffenden Mitteilungen gemäß Absatz 1 bekanntzumachen. Soweit die Regeln der Luxemburger Börse dies zulassen, kann die Emittentin eine Veröffentlichung nach Absatz 1 durch eine Mitteilung an das Clearing System zur Weiterleitung an die Gläubiger ersetzen; jede derartige Mitteilung gilt am siebten Tag nach dem Tag der Mitteilung an das Clearing System als den Gläubigern mitgeteilt. |
§ 13 | | § 13 |
(1) Majority resolutions pursuant to the German Act on Issues of Debt Securities. | | (1) Mehrheitsbeschlüsse nach dem Schuldverschreibungsgesetz. |
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The Holders may with consent of the Issuer (if required) by a majority resolution pursuant to section 5 et seqq. of the German Act on Issues of Debt Securities (Gesetz über Schuldverschreibungen aus Gesamtemissionen) (the SchVG), as amended from time to time, agree to amendments of the Terms and Conditions or resolve any other matters provided for by the SchVG. In particular, the Holders may consent to amendments which materially change the substance of the Terms and Conditions, including such measures as provided for under section 5 paragraph 3 of the SchVG by resolutions passed by such majority of the votes of the Holders as stated under § 13(2) below. A duly passed majority resolution shall be binding upon all Holders. | | Die Gläubiger können mit Zustimmung der Emittentin (soweit erforderlich) aufgrund Mehrheitsbeschlusses nach Maßgabe der §§ 5 ff. des Gesetzes über Schuldverschreibungen aus Gesamtemissionen (das SchVG) in seiner jeweils gültigen Fassung die Emissionsbedingungen ändern oder sonstige Maßnahmen gemäß dem SchVG beschließen. Die Gläubiger können insbesondere einer Änderung wesentlicher Inhalte der Emissionsbedingungen, einschließlich der in § 5 Absatz 3 SchVG vorgesehenen Maßnahmen durch Beschlüsse mit den in dem nachstehenden § 13(2) genannten Mehrheiten zustimmen. Ein ordnungsgemäß gefasster Mehrheitsbeschluss ist für alle Gläubiger verbindlich. |
(2) Majority. | | (2) Mehrheit. |
Except as provided by the following sentence and provided that the quorum requirements are being met, the Holders may pass resolutions by simple majority of the voting rights participating in the vote. Resolutions which materially change the substance of the Terms and Conditions, in particular in the cases of section 5 paragraph 3 numbers 1 through 9 SchVG, or relating to material other matters may only be passed by a majority of at least 75% of the voting rights participating in the vote (a Qualified Majority). | | Vorbehaltlich des nachstehenden Satzes und der Erreichung der erforderlichen Beschlussfähigkeit, beschließen die Gläubiger mit der einfachen Mehrheit der an der Abstimmung teilnehmenden Stimmrechte. Beschlüsse, durch welche der wesentliche Inhalt der Emissionsbedingungen, insbesondere in den Fällen des § 5 Absatz 3 Nummern 1 bis 9 SchVG, geändert wird, bedürfen zu ihrer Wirksamkeit einer Mehrheit von mindestens 75% der an der Abstimmung teilnehmenden Stimmrechte (eine Qualifizierte Mehrheit). |
(3) Passing of resolutions. | | (3) Beschlussfassung. |
The Holders can pass resolutions in a meeting (Gläubigerversammlung) in accordance with section 5 et seqq. of the SchVG or by means of a vote without a meeting (Abstimmung ohne Versammlung) in accordance with section 18 and section 5 et seqq. of the SchVG. | | Die Gläubiger können Beschlüsse in einer Gläubigerversammlung gemäß §§ 5 ff. SchVG oder im Wege einer Abstimmung ohne Versammlung gemäß § 18 und § 5 ff. SchVG fassen. |
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responsibilities and the powers of such Holders' Representative, the transfer of the rights of the Holders to the Holders' Representative and a limitation of liability of the Holders' Representative. § 13(2) to (6) also apply to the resolution regarding the appointment of a Holders' Representative. Appointment of a Holders' Representative may only be passed by a Qualified Majority if such Holders' Representative is to be authorized to consent, in accordance with § 13(2) hereof, to a material change in the substance of the Terms and Conditions or other material matters. | | Aufgaben und Befugnisse des Gemeinsamen Vertreters, die Übertragung der Rechte der Gläubiger auf den Gemeinsamen Vertreter und eine Beschränkung der Haftung des Gemeinsamen Vertreters festlegen. Die § 13(2) bis (6) gelten auch für die Beschlussfassung über die Bestellung eines Gemeinsamen Vertreters. Die Bestellung eines Gemeinsamen Vertreters bedarf einer Qualifizierten Mehrheit, wenn der Gemeinsame Vertreter befugt ist, Änderungen des wesentlichen Inhalts der Emissionsbedingungen oder sonstigen wesentlichen Maßnahmen gemäß § 13(2) zuzustimmen. |
(8) Publication. | | (8) Veröffentlichung. |
Any notices concerning this § 13 shall be made exclusively pursuant to the provisions of the SchVG. | | Alle Bekanntmachungen diesen § 13 betreffend erfolgen ausschließlich gemäß den Bestimmungen des SchVG. |
(9) Amendment of the Guarantee. | | (9) Änderung der Garantie. |
The provisions set out above applicable to the amendment of the Terms and Conditions of the Notes shall apply mutatis mutandis to the Guarantee. | | Die oben aufgeführten auf die Änderung der Emissionsbedingungen der Schuldverschreibungen anwendbaren Bestimmungen gelten entsprechend für die Bestimmungen der Garantie. |
§ 14 | | § 14 |
(1) Applicable Law. | | (1) Anwendbares Recht. |
The Notes, as to form and content, and all rights and obligations of the Holders and the Issuer, shall be governed in every respect by German law. | | Form und Inhalt der Schuldverschreibungen sowie die Rechte und Pflichten der Gläubiger und der Emittentin bestimmen sich in jeder Hinsicht nach deutschem Recht. |
(2) Place of Jurisdiction. | | (2) Gerichtsstand. |
Subject to any mandatory jurisdiction for specific proceedings under the SchVG, the District Court (Landgericht) in Frankfurt am Main shall have non-exclusive jurisdiction for any action or other legal proceedings | | Vorbehaltlich eines zwingenden Gerichtsstandes für besondere Rechtsstreitigkeiten im Zusammenhang mit dem SchVG, ist das Landgericht Frankfurt am Main nicht ausschließlich zuständig für |
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(Proceedings) arising out of or in connection with the Notes. | | sämtliche im Zusammenhang mit den Schuldverschreibungen entstehenden Klagen oder sonstige Verfahren (Rechtsstreitigkeiten). |
(3) Enforcement. | | (3) Gerichtliche Geltendmachung. |
Any Holder of Notes may in any proceedings against the Issuer or the Guarantor or to which such Holder and the Issuer or the Guarantor are parties, protect and enforce in his own name his rights arising under such Notes on the basis of (i) a statement issued by the Custodian with whom such Holder maintains a securities account in respect of the Notes (a) stating the full name and address of the Holder, (b) specifying the aggregate principal amount of Notes credited to such securities account on the date of such statement and (c) confirming that the Custodian has given written notice to the Clearing System containing the information pursuant to (a) and (b) which has been confirmed by the Clearing System; (ii) a copy of the Note in global form certified as being a true copy by a duly authorized officer of the Clearing System or a depositary of the Clearing System, without the need for production in such proceedings of the actual records or the global note representing the Notes or (iii) any other means of proof permitted in legal proceedings in the country of enforcement. For purposes of the foregoing, Custodian means any bank or other financial institution of recognized standing authorized to engage in securities custody business with which the Holder maintains a securities account in respect of the Notes and which maintains an account with the Clearing System, and includes the Clearing System. Each Holder may, without prejudice to the foregoing, protect and enforce his rights under these Notes also in any other way which is admitted in the country of the Proceedings. | | Jeder Gläubiger von Schuldverschreibungen ist berechtigt, in jedem Rechtsstreit gegen die Emittentin oder die Garantiegeberin oder in jedem Rechtsstreit, in dem der Gläubiger und die Emittentin oder die Garantiegeberin Partei sind, seine Rechte aus diesen Schuldverschreibungen im eigenen Namen auf der folgenden Grundlage zu schützen oder geltend zu machen: (i) er bringt eine Bescheinigung der Depotbank bei, bei der er für die Schuldverschreibungen ein Wertpapierdepot unterhält, welche (a) den vollständigen Namen und die vollständige Adresse des Gläubigers enthält, (b) den Gesamtnennbetrag der Schuldverschreibungen bezeichnet, die unter dem Datum der Bestätigung auf dem Wertpapierdepot verbucht sind und (c) bestätigt, dass die Depotbank gegenüber dem Clearingsystem eine schriftliche Erklärung abgegeben hat, die die vorstehend unter (a) und (b) bezeichneten Informationen enthält und einen Bestätigungsvermerk des Clearingsystems trägt; (ii) er legt eine Kopie der die betreffenden Schuldverschreibungen verbriefenden Globalurkunde vor, deren Übereinstimmung mit dem Original eine vertretungsberechtigte Person des Clearingsystems oder des Verwahrers des Clearingsystems bestätigt hat, ohne dass eine Vorlage der Originalbelege oder der die Schuldverschreibungen verbriefenden Globalurkunde in einem solchen Verfahren erforderlich wäre oder (iii) auf jede andere Weise, die im Lande der Geltendmachung prozessual zulässig ist. Für die Zwecke des Vorstehenden bezeichnet Depotbank jede Bank oder ein sonstiges anerkanntes Finanzinstitut, das berechtigt ist, das Wertpapierverwahrungsgeschäft zu |
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| | betreiben und bei der/dem der Gläubiger ein Wertpapierdepot für die Schuldverschreibungen unterhält und ein Konto beim Clearingsystem unterhält, einschließlich des Clearingsystems. Jeder Gläubiger kann unbeschadet des Vorstehenden seine Rechte aus diesen Schuldverschreibungen auch auf jede andere Weise schützen und durchsetzen, die im Land des Verfahrens zulässig ist. |
§ 15 | | § 15 |
These Terms and Conditions are written in the German language and provided with an English language translation. The German text shall be controlling and binding. The English language translation is provided for convenience only. | | Diese Emissionsbedingungen sind in deutscher Sprache abgefasst. Eine Übersetzung in die englische Sprache ist beigefügt. Der deutsche Text ist bindend und maßgeblich. Die Übersetzung in die englische Sprache ist unverbindlich. |
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Part II.: ADDITIONAL INFORMATION
Teil II ZUSÄTZLICHE INFORMATIONEN
A. Essential information Grundlegende Angaben | |
Interests of Natural and Legal Persons involved in the Issue/Offer Interessen von Seiten natürlicher und juristischer Personen, die an der Emission/dem Angebot beteiligt sind | So far as the Issuer is aware, no person involved in the offer of the Notes has an interest material to the offer, except that certain Dealers and their affiliates may be customers of, and borrowers from the creditors of the Issuer and its affiliates. In addition, certain of the Dealers and their affiliates have engaged, and may in future engage, in investment banking and/or commercial banking transactions with, and may perform services for the Issuer or its affiliates in the ordinary course of business. Nach Kenntnis der Emittentin bestehen bei den an der Emission beteiligten Personen keine Interessen, die für das Angebot bedeutsam sind, außer, dass bestimmte Platzeure und mit ihnen verbundene Unternehmen Kunden von, Kreditnehmer der oder Kreditgeber der Emittentin und mit ihr verbundener Unternehmen sein können. Außerdem sind bestimmte Platzeure an Investment Banking Transaktionen und/oder Commercial Banking Transaktionen mit der Emittentin oder mit ihr verbundenen Unternehmen beteiligt oder könnten sich in Zukunft daran beteiligen. |
Reasons for the offer to the public or for the admission to trading and use of proceeds | General corporate purposes, including the refinancing of existing financial liabilities. |
Gründe für das öffentliche Angebot oder die Zulassung zum Handel und Verwendung der Erlöse | Allgemeine Geschäftszwecke, einschließlich der Refinanzierung bestehender Finanzverbindlichkeiten. |
| Estimated net proceeds Geschätzter Nettobetrag der Erträge | EUR 744,825,000 |
| Estimated total expenses (excluding commissions of the managers) of the issue Geschätzte Gesamtkosten (ausschließlich Provisionen der Manager) der Emission | EUR 50,000 |
Eurosystem eligibility EZB-Fähigkeit | | |
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☒ | Intended to be held in a manner which would allow Eurosystem eligibility | Yes | |
| Soll in EZB-fähiger Weise gehalten werden | Ja | |
| | Yes. Note that the designation "Yes" in the case of a NGN simply means that the Notes are intended upon issue to be deposited with one of the ICSDs as common safekeeper, and does not necessarily mean that the Notes will be recognized as eligible collateral for Eurosystem monetary policy and intraday credit operations by the Eurosystem either upon issue or at any or all times during their life. Such recognition will depend upon the ECB being satisfied that Eurosystem eligibility criteria have been met. | |
| | Ja. Es ist zu beachten, dass die Bestimmung "Ja" im Fall einer NGN lediglich bedeutet, dass die Schuldverschreibungen nach Begebung bei einer der ICSDs als gemeinsamer Verwahrer hinterlegt werden sollen, und es bedeutet nicht notwendigerweise, dass die Schuldverschreibungen als geeignete Sicherheit im Sinne der Währungspolitik des Eurosystems und der taggleichen Überziehungen (intraday credit operations) des Eurosystem entweder nach Begebung oder zu einem Zeitpunkt während ihrer Existenz anerkannt werden. Eine solche Anerkennung wird vom Urteil der EZB abhängen, dass die Eurosystemfähigkeitskriterien erfüllt werden. | |
B. Information concerning the securities to be offered/admitted to trading Informationen über die anzubietenden bzw. zum Handel zuzulassenden Wertpapiere | |
Securities Identification Numbers Wertpapier-Kenn-Nummern | |
Common Code Common Code | 253044462 |
International Securities Identification Number (ISIN) Internationale Wertpapierkennnummer (ISIN) | XS2530444624 |
German Securities Code (WKN) Deutsche Wertpapierkennnummer (WKN) | A30VPB |
Financial Instrument Short Name (FISN) Emittenten- und Instrumenten-Kurzname (FISN) | FRESENIUS MEDIC/.1EMTN 20270913 |
Classification of Financial Instruments Code (CFI) Klassifikationscode von Finanzinstrumenten (CFI) | DTFXFB |
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Any other securities number Andere Wertpapierkennnummer | Not applicable | |
Historic Interest Rates and future performance as well as Zinssätze der Vergangenheit und künftige Entwicklungen sowie ihre Volatilität | Not applicable Nicht anwendbar | |
Yield to final maturity Rendite bei Endfälligkeit | 3.957 per cent. | |
Representation of debt security holders including an identification of the organization representing the investors and provisions applying to such representation. Indication of the website where the public may have free access to the contracts relation to these forms of representation Vertretung der Schuldtitelinhaber unter Angabe der die Anleger vertretenden Organisation und der für diese Vertretung geltenden Bestimmungen. Angabe der Website, auf der die Anleger die Verträge, die diese Repräsentationsformen regeln, kostenlos einsehen können | Not applicable Nicht anwendbar | |
Resolutions, authorizations and approvals by virtue of which the Notes will be created | The issue of the Notes has been authorized by a resolution of the management board of the Issuer's general partner dated August 30, 2022 and by a resolution of the supervisory board of the Issuer's general partner dated December 1, 2021. Die Begebung der Schuldverschreibungen wurde ordnungsgemäß genehmigt durch Vorstandsbeschluss der Komplementärin der Emittentin vom 30. August 2022 und Aufsichtsratsbeschluss der Komplementärin der Emittentin vom 1. Dezember 2021. | |
C. Terms and conditions of the offer of the Notes to the public | | |
C.1 Conditions, offer statistics, expected timetable and action required to apply for the offer | Not applicable | |
C.2 Plan of distribution and allotment | Not applicable Nicht anwendbar | |
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C.3 Pricing | | |
Issue Price | 99.635 per cent. 99,635% | |
Expected price at which the Notes will be offered | Not applicable Nicht anwendbar | |
Amount of expenses and taxes charged to the subscriber / | Not applicable Nicht anwendbar | |
C.4Placing and underwriting Platzierung und Emission | | |
Name and address of the coordinator(s) of the global offer and of single parts of the offer and, to the extent known to the Issuer or the offeror, of the placers in the various countries where the offer takes place | Not applicable | |
Method of distribution Vertriebsmethode | | |
☐ | Non-syndicated | |
☒ | Syndicated | |
Subscription Agreement Übernahmevertrag | | |
Date of Subscription Agreement Datum des Subscription Agreements | September 15, 2022 | |
Material Features of the Subscription Agreement: Hauptmerkmale des Übernahmevertrages: | Under the Subscription Agreement, the Issuer agrees to issue the Notes and each Dealer agrees to purchase the Notes; the Issuer and each Dealer agree inter alia on the aggregate principal amount of the issue, the principal amount of the Dealers' commitments, the Issue Price, the Issue Date and the commissions. Unter dem Übernahmevertrag vereinbart die Emittentin, die Schuldverschreibungen zu begeben und jeder Platzeur stimmt zu, die Schuldverschreibungen zu erwerben. | |
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| Die Emittentin und jeder Platzeur vereinbaren im Übernahmevertrag unter anderem den Gesamtnennbetrag der Emission, die gemäß der Übernahmeverpflichtung auf die Platzeure entfallenden Nennbeträge, den Ausgabepreis, den Valutierungstag und die Provisionen. |
Management Details including form of commitment Einzelheiten bezüglich des Bankenkonsortiums einschließlich der Art der Übernahme | |
Specify Management Group or Dealer (names and addresses) | Active Bookrunners Citigroup Global Markets Europe AG Crédit Agricole Corporate and Investment Bank Mizuho Securities Europe GmbH Passive Bookrunners |
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| 1077 XV Amsterdam | |
☒ | Firm commitment Feste Zusage | |
☐ | no firm commitment / best efforts arrangements Keine feste Zusage / zu den bestmöglichen Bedingungen | |
Commissions | | |
Management/Underwriting Commission (specify) Management- und Übernahmeprovision (angeben) | 0.325 per cent. | |
Selling Concession (specify) Verkaufsprovision (angeben) | Not applicable | |
Listing Commission (specify) Börsenzulassungsprovision (angeben) | Not applicable | |
Prohibition of Sales to EEA Retail Investors Verbot des Verkaufs an Kleinanleger im Europäischen Wirtschaftsraum | Not applicable Nicht anwendbar | |
Prohibition of Sales to UK Retail Investors Verbot des Verkaufs an Kleinanleger im Vereinigten Königreich | Not applicable Nicht anwendbar | |
Stabilising Dealer/Manager Kursstabilisierender Dealer/Manager | BNP Paribas | |
C.5Public Offer Jurisdictions Jurisdiktionen für öffentliches Angebot | | |
Public Offer Jurisdiction(s) Jurisdiktionen, in denen ein öffentliches | Luxembourg and Germany | |
D. Listing(s) and admission to trading Börsenzulassung(en) und Notierungsaufnahme | Yes | |
☒ | Regulated Market of the Luxembourg Stock | |
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1 | According to the rating definitions published by S&P on its homepage, 'BBB' means: "Adequate capacity to meet financial commitments, but more subject to adverse economic conditions." Ratings from 'AA' to 'CCC' may be modified by the addition of a plus (+) or minus (-) sign to show relative standing within the rating categories. |
2 | According to the rating definitions published on its website, Moody's defines obligations rated 'Baa' as follows: "Obligations rated Baa are subject to moderate credit risk. They are considered medium-grade and as such may possess speculative characteristics." Moody’s appends numerical modifiers 1, 2, and 3 to each generic rating classification from Aa through Caa. The modifier 3 indicates a ranking in the lower end of that generic rating category. |
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| BBB-3 by Fitch Ratings Ireland Limited. S&P Global Ratings Europe Limited is established in Ireland and is registered pursuant to Regulation (EC) No 1060/2009 of the European Parliament and of the Council of 16 September 2009 on credit rating agencies, as amended (the CRA Regulation). Moody's Deutschland GmbH is established in Germany and is registered pursuant to the CRA Regulation. Fitch Ratings Ireland Limited is established in Ireland and is registered pursuant to the CRA Regulation. The European Securities and Markets Authority (ESMA) publishes on its website (http://www.esma.europa.eu/page/List-registered-and-certified-CRAs) a list of credit rating agencies registered in accordance with the CRA Regulation. That list is updated within five working days following the adoption of a decision under Article 16, 17 or 20 CRA Regulation. The European Commission shall publish that updated list in the Official Journal of the European Union within 30 days following such update. S&P Global Ratings Europe Limited hat ihren Sitz in Irland und ist gemäß Verordnung (EG) Nr. 1060/2009 des Europäischen Parlaments und des Rates vom 16. September 2009 über Ratingagenturen (in der geänderten Fassung) (die Ratingverordnung) registriert. Moody's Deutschland GmbH hat ihren Sitz in Deutschland und ist gemäß der Ratingverordnung registriert. Fitch Ratings Ireland Limited hat ihren Sitz in Irland und ist gemäß der Ratingverordnung registriert. Die Europäische |
3 | According to the rating definitions published on its website, Fitch defines obligations rated 'BBB' as follows: "BBB ratings indicate that expectations of default risk are currently low. The capacity for payment of financial commitments is considered adequate, but adverse business or economic conditions are more likely to impair this capacity." The modifiers "+" or "–" may be appended to a rating to denote relative status within major rating categories. |
4 | Gemäß der von S&P auf ihrer Website veröffentlichten Ratingdefinitionen ist 'BBB' wie folgt definiert: "Adäquate Kapazität zur Erfüllung der finanziellen Verpflichtungen, aber anfälliger für nachteilige wirtschaftliche Bedingungen." Den Ratings von 'AA' bis 'CCC' kann ein Pluszeichen (+) oder Minuszeichen (-) hinzugefügt werden, um den jeweiligen Rang innerhalb der größeren Ratingkategorie anzuzeigen. |
5 | Gemäß der auf ihrer Website veröffentlichten Ratingdefinitionen werden Verbindlichkeiten mit einem Rating von 'Baa' von Moody's wie folgt definiert: "Baa-geratete Verbindlichkeiten bergen ein moderates Kreditrisiko. Sie gelten als von mittlerer Qualität und weisen als solche mitunter spekulative Elemente auf." Moody's verwendet in den Ratingkategorien Aa bis Caa zusätzlich numerische Unterteilungen. Der Zusatz "3" bedeutet eine Einstufung in das untere Drittel der jeweiligen Ratingkategorie. |
6 | Gemäß der auf ihrer Website veröffentlichten Ratingdefinitionen werden Verbindlichkeiten mit einem Rating von 'BBB' von Fitch wie folgt definiert: "BBB Ratings weisen darauf hin, dass die Erwartungen hinsichtlich eines Ausfallrisikos momentan gering sind. Die Fähigkeit, finanzielle Verbindlichkeiten zu bezahlen, wird als adäquat angesehen, jedoch können nachteilige Geschäfts- oder Wirtschaftsbedingungen leichter zu einer Beeinträchtigung dieser Fähigkeit führen." Den Ratings kann ein Plus- oder ein Minuszeichen hinzugefügt werden, um den jeweiligen Rang innerhalb größerer Ratingkategorien anzuzeigen. |
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| Wertpapier und Marktaufsichtsbehörde (ESMA) veröffentlicht auf ihrer Webseite (http://www.esma.europa.eu/page/List-registered-and-certified-CRAs) ein Verzeichnis der nach der Ratingverordnung registrierten Ratingagenturen. Dieses Verzeichnis wird innerhalb von fünf Werktagen nach Annahme eines Beschlusses gemäß Artikel 16, 17 oder 20 der Ratingverordnung aktualisiert. Die Europäische Kommission veröffentlicht das aktualisierte Verzeichnis im Amtsblatt der Europäischen Union innerhalb von 30 Tagen nach der Aktualisierung. |
F. | Information to be provided regarding the consent by the Issuer or person responsible for drawing up the Prospectus and the Final Terms |
Zur Verfügung zu stellende Informationen über die Zustimmung der Emittentin oder der für die Erstellung des Prospekts und der Endgültigen Bedingungen zuständigen Person
The consent to the use of the Prospectus and these Final Terms for the subsequent resale or final placement of Notes by all financial intermediaries is given by the Issuer in relation to Luxembourg and Germany.
The subsequent resale or final placement of Notes by financial intermediaries can be made during the offer period. The offer period commences on September 15, 2022 and ends on September 20, 2022.
Die Zustimmung zu der Verwendung des Prospekts und dieser Endgültigen Bedingungen zu der späteren Weiterveräußerung und der endgültigen Platzierung der Schuldverschreibungen durch alle Finanzintermediäre wird von der Emittentin in Bezug auf Luxemburg und Deutschland erteilt.
Die spätere Weiterveräußerung und endgültige Platzierung der Wertpapiere durch Finanzintermediäre kann während der Angebotsfrist erfolgen. Die Angebotsfrist beginnt am 15. September 2022 und endet am 20. September 2022.
Third Party Information
Informationen von Seiten Dritter
With respect to any information included herein and specified to be sourced from a third party (i) the Issuer confirms that any such information has been accurately reproduced and as far as the Issuer is aware and is able to ascertain from information available to it from such third party, no facts have been omitted which would render the reproduced information inaccurate or misleading and (ii) the Issuer has not independently verified any such information and accepts no responsibility for the accuracy thereof.
Hinsichtlich der hierin enthaltenen und als solche gekennzeichneten Informationen von Seiten Dritter gilt Folgendes: (i) Die Emittentin bestätigt, dass diese Informationen zutreffend wiedergegeben worden sind und - soweit es der Emittentin bekannt ist und sie aus den von diesen Dritten zur Verfügung gestellten Informationen ableiten konnte - wurden keine Fakten unterschlagen, die die wiedergegebenen Informationen unzutreffend oder irreführend gestalten würden; (ii) die Emittentin hat diese Informationen nicht selbständig überprüft und übernimmt keine Verantwortung für ihre Richtigkeit.
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Fresenius Medical Care AG & Co. KGaA represented by Fresenius Medical Care Management AG, its general partner
Fresenius Medical Care AG & Co. KGaA vertreten durch Fresenius Medical Care Management AG, ihren persönlich haftenden Gesellschafter
_________________________________
Helen Giza
Member of the management board of Fresenius Medical Care Management AG
_________________________________
Dr. Katarzyna Mazur-Hofsäß
Member of the management board of Fresenius Medical Care Management AG
Annex
Summary for the Individual Issue
SECTION A: INTRODUCTION CONTAINING WARNINGS
This summary relates to the series EUR 750,000,000 3.875 per cent. Notes due September 20, 2027 with the ISIN XS2530444624 (the Notes), issued by Fresenius Medical Care AG & Co. KGaA, Else-Kröner-Straße 1, 61352 Bad Homburg vor der Höhe, Germany (tel.: +49-6172-609-0; website: www.freseniusmedicalcare.com; LEI: 549300CP8NY40UP89Q40) (the Issuer and, together with its consolidated group companies, the Group, also referred to as we, us or our) under the Issuer's EUR 10,000,000,000 Debt Issuance Program (the Program).
The Commission de Surveillance du Secteur Financier (CSSF), 283, route d'Arlon L-1150 Luxembourg (tel.: +352 26 25 1 - 1; fax: +352 26 25 1 - 2601; e-mail: direction@cssf.lu) has approved the base prospectus for the Program (the Base Prospectus) as the competent authority under Regulation (EU) 2017/1129 on May 17, 2022.
This Summary has been prepared in accordance with Article 7 of Regulation (EU) 2017/1129 and should be read as an introduction to the Base Prospectus and the applicable Final Terms. Any decision to invest in the Notes should be based on consideration of the Base Prospectus as a whole, including any documents incorporated by reference therein, and the applicable Final Terms by the investor. An investor in the Notes could lose all or part of the invested capital. Where a claim relating to the information contained in the Base Prospectus or the applicable Final Terms is brought before a court, the plaintiff investor might, under national law, have to bear the costs of translating the Base Prospectus and the applicable Final Terms, before the legal proceedings are initiated. Civil liability attaches only to those persons who have tabled the Summary including any translation thereof, but only if the Summary is misleading, inaccurate or inconsistent, when read together with the Base Prospectus and the applicable Final Terms, or where it does not provide, when read together with the Base Prospectus and the applicable Final Terms, key information in order to aid investors when considering whether to invest in such Notes.
SECTION B: KEY INFORMATION ON THE ISSUER
B.1 Who is the issuer of the securities?
B.1.1 Domicile, legal form, LEI, law under which it operates and country of operation
The Issuer is a partnership limited by shares (Kommanditgesellschaft auf Aktien) with a German stock corporation (Aktiengesellschaft) as a general partner and its registered seat (Sitz) at Hof an der Saale, Germany, incorporated under and governed by the laws of Germany. The LEI of the Issuer is 549300CP8NY40UP89Q40.
B.1.2 Principal activities
The Issuer's principal activity is to act as holding company for its subsidiaries, which provide dialysis care and related services to persons who suffer from end-stage kidney diseases as well as other health care services, and which develop and manufacture a wide variety of health care products, which include both dialysis and non-dialysis products.
B.1.3 Major shareholders
As of March 31, 2022, the Issuer's share capital consisted of 293,027,279 issued and outstanding ordinary shares. Fresenius SE & Co. KGaA (Fresenius SE) owned approximately 32.2% of the Issuer's ordinary shares on March 31, 2022. Fresenius SE is also the owner of 100% of the outstanding share capital of the Issuer's general partner and has sole power to elect the supervisory board of the Issuer's general partner. Through its ownership of the Issuer's general partner, Fresenius SE is able to exercise de facto management control of the Issuer, even though it owns less than a majority of the Issuer's outstanding voting shares. The Else Kröner-Fresenius-Stiftung is the sole shareholder of Fresenius Management SE, the general partner of Fresenius SE, and has sole power to elect
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the supervisory board of Fresenius Management SE. In addition, the Else Kröner-Fresenius-Stiftung owned approximately 26.6% of the share capital of Fresenius SE on December 31, 2021.
B.1.4 Key managing directors
The Issuer's sole general partner is Fresenius Medical Care Management AG (Management AG). As the Issuer's general partner, Management AG is solely responsible for the management of the Issuer, including all exceptional management measures, and solely represents the Issuer in its dealings with third parties. When acting in its capacity as general partner for the Issuer, Management AG is acting through its management board (Management Board). The Management Board consists of Rice Powell, Helen Giza, William Valle, Dr. Katarzyna Mazur-Hofsäß and Franklin W. Maddux.
As previously announced, the Chief Executive Officer and Chairman of the Management Board, Rice Powell, will be succeeded by Dr. Carla Kriwet. Dr. Kriwet will now assume office effective October 1, 2022. Rice Powell is stepping down from his position on September 30, 2022, after 10 years of heading the Issuer.
B.1.5 Identity of the statutory auditors
PricewaterhouseCoopers GmbH Wirtschaftsprüfungsgesellschaft, Friedrich-Ebert-Anlage 35-37, 60327 Frankfurt am Main, Germany (PwC), a member of the German Chamber of Public Accountants (Wirtschaftsprüferkammer), Berlin, Germany, was appointed to serve as independent auditor of the Issuer for the fiscal years ended December 31, 2021 and 2020.
B.2 What is the key financial information regarding the Issuer?
The following selected consolidated financial information has been taken or derived from our consolidated financial statements prepared in accordance with IFRS as of and for the six months ended June 30, 2022 and as of and for each of the fiscal years ended December 31, 2021 and 2020. PwC audited the consolidated financial statements as of and for the fiscal years ended December 31, 2021 and 2020 and issued unqualified auditor's reports (uneingeschränkte Bestätigungsvermerke) thereon. The selected consolidated financial information as of and for the six months ended June 30, 2022 and 2021 has been taken or derived from our unaudited condensed consolidated interim financial statements as of and for the six months ended June 30, 2022 prepared in accordance with IFRS applicable to interim financial reporting (IAS 34). Our unaudited condensed consolidated interim financial statements were prepared on a basis substantially consistent with our audited consolidated financial statements. This information should be read together with our consolidated financial statements and the notes to those statements incorporated by reference into the Base Prospectus.
Selected Consolidated Statements of Income Data
| | For the six months ended | | For the fiscal year ended | ||||
| | | ||||||
In € millions, except per share amounts |
| 2022 |
| 2021 |
| 2021 |
| 2020 |
Revenue | | 9,305 | | 8,530 | | 17,619 | | 17,859 |
Gross profit | | 2,604 | | 2,491 | | 5,077 | | 5,537 |
Operating income | | 688 | | 898 | | 1,852 | | 2,304 |
Net income attributable to shareholders of the Issuer | | 305 | | 468 | | 969 | | 1,164 |
Basic earnings per share | | 1.04 | | 1.60 | | 3.31 | | 3.96 |
Diluted earnings per share | | 1.04 | | 1.60 | | 3.31 | | 3.96 |
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Selected Consolidated Balance Sheet Data
| | As of June 30, | | As of December 31, | ||
In € millions |
| 2022 |
| 2021 |
| 2020 |
Total assets | | 36,070 | | 34,367 | | 31,689 |
Total current liabilities(1) | | 6,877 | | 7,258 | | 6,056 |
Total liabilities | | 20,619 | | 20,388 | | 19,358 |
Net debt(2) | | 12,634 | | 11,838 | | 11,298 |
Total equity | | 15,451 | | 13,979 | | 12,331 |
(1) | In the consolidated balance sheets, "Current provisions and other current liabilities" in the amount of EUR 103,409 thousand related to the Issuer's self-insurance programs as of December 31, 2020 have been reclassified to line item "Non-current provisions and other non-current liabilities" to conform to the presentation of 2021 numbers. Therefore, the figure presented is taken from the consolidated financial statements as of and for the fiscal year ended December 31, 2021. |
(2) | Unaudited. Net debt, a Non-GAAP Measure, is defined as the sum of our debt and lease liabilities less our cash and cash equivalents. Debt and lease liabilities includes the following balance sheet line items: short-term debt from unrelated parties, short-term debt from related parties, current portion of long-term debt, current portion of lease liabilities from unrelated parties, current portion of lease liabilities from related parties, long-term debt, less current portion, lease liabilities from unrelated parties, less current portion and lease liabilities from related parties, less current portion as presented in our consolidated balance sheets as of December 31, 2021 and 2020 and the unaudited consolidated balance sheet as of June 30, 2022. |
Selected Consolidated Statements of Cash Flow Data
| | For the six months ended | | For the fiscal year ended | ||||
In € millions |
| 2022 |
| 2021 |
| 2021 |
| 2020 |
Net cash provided by (used in) operating activities | | 910 | | 1,129 | | 2,489 | | 4,233 |
Net cash provided by (used in) investing activities | | (409) | | (473) | | (1,196) | | (1,335) |
Net cash provided by (used in) financing activities | | (995) | | (378) | | (1,024) | | (2,664) |
Cash and cash equivalents at end of the period | | 1,025 | | 1,408 | | 1,482 | | 1,082 |
B.3 What are the key risks that are specific to the Issuer?
The key risks relating to the Issuer and the Group are:
Risks relating to Legal and Regulatory Matters
· | We operate in a highly regulated industry such that the potential for legislative reform provides uncertainty and potential threats to our operating models and results. |
· | Changes in reimbursement, payor mix and/or governmental regulations for health care could materially decrease our revenues and operating profit. |
Risks Relating to Internal Control and Compliance
· | We operate in many different jurisdictions and we could be adversely affected by violations of the U.S. Foreign Corrupt Practices Act and similar worldwide anti-corruption laws. |
Risks Relating to Our Business Activities and Industry
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· | We are subject to risks associated with public health crises and epidemics/pandemics, such as the global spread of the COVID-19 pandemic. |
· | If physicians and other referral sources cease referring patients to our health care service businesses and facilities or cease purchasing or prescribing our products, our revenues would decrease. |
Risks Relating to Taxation and Accounting
· | There are significant risks associated with estimating the amount of health care service revenues that we recognize that could impact the timing of our recognition of revenues or have a significant impact on our operating results and financial condition. |
· | Diverging views of fiscal authorities could require us to make additional tax payments. |
Risks Relating to Our Financial Condition and Our Securities
· | Our indebtedness may prevent us from fulfilling our debt-service obligations or implementing certain elements of our business strategy. |
· | Despite our existing indebtedness, we may still be able to incur significantly more debt. This could intensify the risks described above. |
SECTION C: KEY INFORMATION ON THE SECURITIES
C.1 What are the main features of the Securities?
C.1.1 Type, class and ISIN
The Notes are fixed rate notes. They are issued as Series number 7, Tranche number 1, ISIN XS2530444624.
C.1.2 Currency, denomination, par value, number of securities issued and duration
The Notes are issued in euro. The specified denomination per Note is EUR 1,000. The number of Notes is 750,000. The term of the Notes is five years.
C.1.3. Rights attached to the Securities
Each holder of a Note (each a Holder) has the right towards the Issuer to claim payment of interest and nominal when such payments are due in accordance with the terms and conditions of the Notes (the Terms and Conditions). Unless previously redeemed, or purchased and cancelled, each Note will be redeemed at its principal amount on the Maturity Date.
Negative Pledge: The Notes contain a limited negative pledge provision.
Events of Default: The Notes provide for events of default entitling Holders to demand immediate redemption of the Notes.
Cross Default: The Notes provide for cross default provisions.
Change of Control: Upon the occurrence of specific change of control events with a ratings decline, the Holders will have the right to require that the Issuer repurchases their Notes at 101% of the principal amount, plus accrued and unpaid interest (if any).
Early Redemption: The Notes may be called for redemption and redeemed prior to their stated maturity at the option of the Issuer for taxation reasons or within a certain Call Redemption Period. The Notes may also be called for redemption and be redeemed prior to their stated maturity at the option of the Issuer for reason of Minimal Outstanding Principal Amount.
Resolutions of Holders: In accordance with the German Act on Debt Securities (Gesetz über Schuldverschreibungen aus Gesamtemissionen, SchVG), the Notes contain provisions pursuant to which Holders may agree by resolution to amend the Terms and Conditions (with the consent of the Issuer) and to decide upon
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certain other matters regarding the Notes. Resolutions of Holders properly adopted, either in a meeting of Holders or by vote taken without a meeting in accordance with the Terms and Conditions, are binding upon all Holders. Resolutions providing for material amendments to the Terms and Conditions require a majority of not less than 75% of the votes cast. Resolutions regarding other amendments are passed by a simple majority of the votes cast.
Governing Law: The Notes are governed by German law.
C.1.4 Rank of the Securities in the Issuer's capital structure upon insolvency
The Notes constitute unsecured and unsubordinated obligations of the Issuer ranking pari passu among themselves and pari passu with all other present or future unsecured and unsubordinated obligations of the Issuer, unless such obligations are accorded priority under mandatory provisions of statutory law.
C.1.5 Restrictions on free transferability of the securities
Not applicable. The Notes are freely transferable.
C.1.6 Payout policy (interest)
The Notes bear interest on their specified denomination from (and including) September 20, 2022 at a fixed rate of 3.875 per cent. per annum. Interest is payable in arrears on each Interest Payment Date.
Interest Payment Date means September 20 each year with the first Interest Payment Date being September 20, 2023.
Maturity Date: Unless previously redeemed in whole or in part or purchased and cancelled, the Notes shall be redeemed at their principal amount on September 20, 2027, together with interest from the most recent Interest Payment Date to (but excluding) the Maturity Date.
Yield to final maturity: The yield to final maturity equals 3.957 percent per annum.
C.2 Where will the Securities be traded?
Application has been made to list the Notes on the official list of the Luxembourg Stock Exchange and to admit the Notes to trading on the regulated market of the Luxembourg Stock Exchange.
C.3 Is there a guarantee attached to the securities?
C.3.1 Nature and scope of the Guarantee
Fresenius Medical Care Holdings, Inc. (the Guarantor), an indirectly wholly-owned subsidiary of the Issuer, has given an unconditional and irrevocable guarantee for the due and punctual payment of principal of, and interest on, and any other amounts payable under the Notes (the Guarantee). The Guarantee includes a release mechanism in certain circumstances described in the Guarantee. The Guarantee is governed by German law and constitutes a contract for the benefit of the Holders from time to time as third-party beneficiaries in accordance with Section 328(1) German Civil Code (Bürgerliches Gesetzbuch).
C.3.2 Description of the Guarantor
The legal name of the Guarantor is "Fresenius Medical Care Holdings, Inc." and its LEI is XTHT88D08CLK11B3GJ82. As there is no general federal corporation law in the United States, the Guarantor is organized and existing under the Business Corporation Law of the State of New York. Its executive offices are located at 920 Winter Street, Waltham, Massachusetts, 02451-1457, United States, and its telephone number is +1(781) 699-9000.
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C.3.3 Key financial information relating to the Guarantor
The following selected financial information is taken or derived from the Guarantor's audited consolidated financial statements as of and for the years ended December 31, 2021 and 2020, prepared in accordance with U.S. GAAP. PricewaterhouseCoopers LLP audited the Guarantor's consolidated financial statements as of and for the fiscal years ended December 31, 2021 and 2020 and issued an unqualified auditor's report thereon. You should read this information together with the Guarantor's consolidated financial statements and the notes to those statements incorporated by reference into the Base Prospectus.
Selected Consolidated Statements of Income Data
| | For the fiscal year ended December 31, | | ||
In US$millions | | 2021 | | 2020 | |
Health Care revenues, net |
| 13,003 |
| 12,956 |
|
Medical supplies revenue | | 1,290 | | 1,279 | |
Expenses | | 12,776 | | 12,580 | |
Income before income taxes | | 1,517 | | 1,656 | |
Net income | | 1,187 | | 1,287 | |
Income attributable to non-controlling interests | | 286 | | 300 | |
Net income attributable to Guarantor | | 901 | | 987 | |
Selected Consolidated Balance Sheet Data
| | As of December 31, | ||
In US$millions |
| 2021 |
| 2020 |
Total assets | | 27,201 | | 27,635 |
Total current liabilities | | 4,322 | | 4,506 |
Total liabilities | | 15,026 | | 15,661 |
Total equity | | 10,864 | | 10,728 |
Net debt(1) | | 9,584 | | 10,120 |
(1) | Unaudited. Net debt is a Non-GAAP Measure. We define net debt as the sum of the Guarantor's debt and lease liabilities less the Guarantor's cash and cash equivalents (including restricted cash and cash equivalents). The Guarantor's debt and lease liabilities include the following balance sheet line items: current borrowings from affiliates, current portion of operating lease liabilities, short-term borrowings, current portion of long-term debt, long-term debt, long-term borrowings from affiliates and long-term operating lease liabilities as presented in the consolidated balance sheets of the Guarantor's consolidated financial statements as of and for the fiscal years ended December 31, 2021 and 2020. |
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Selected Consolidated Statements of Cash Flow Data
| | For the fiscal year ended December 31, | ||
In US$millions |
| 2021 |
| 2020 |
Net cash provided by (used in) operating activities | | 1,341 | | 3,049 |
Net cash provided by (used in) investing activities | | 245 | | (1,959) |
Net cash provided by (used in) financing activities | | (1,324) | | (878) |
Cash and cash equivalents at end of the period | | 940 | | 679 |
C.3.4 Most material risk factors pertaining to the Guarantor
· | The Guarantor obtains substantially all of its income from its subsidiaries, and the holding company structure may limit the Guarantor's ability to benefit from the assets of its subsidiaries. In addition, the Guarantee will be effectively subordinated to the Guarantor's debt to the extent such debt is secured by assets that are not also securing the Notes. |
C.4 What are the key risks that are specific to the Securities?
Risks Relating to the Nature and Ranking of the Notes
· | The Notes are structurally subordinated to the claims of other creditors of non-guarantors within the Group. |
· | The Notes and the Guarantee will be effectively subordinated to secured debt of the Issuer and the Guarantor to the extent such debt is secured by assets that are not also securing the Notes. |
· | The Issuer and the Guarantor both rely on distributions from their subsidiaries to meet their payment obligations. |
· | We may not be able to make a change of control redemption upon demand. |
Risks Relating to the Guarantor and the Guarantee
· | U.S. federal and state laws allow courts, under specific circumstances, to declare the Guarantee void and to require Holders to return payments received from the Guarantor. |
SECTION D: KEY INFORMATION ON THE OFFER OF SECURITIES TO THE PUBLIC AND THE ADMISSION TO TRADING ON A REGULATED MARKET
D.1 Under which conditions and timetable can I invest in this security?
Application has been made to list the Notes on the official list of the Luxembourg Stock Exchange and to admit the Notes to trading on the regulated market of the Luxembourg Stock Exchange.
There will be no public offer of the Notes by the Issuer. The consent to the use of the Prospectus and the Final Terms for the subsequent resale or final placement of Notes by all financial intermediaries is given by the Issuer in relation to Luxembourg and Germany. The subsequent resale or final placement of Notes by financial intermediaries can be made during the offer period which commences on September 15, 2022 and ends on September 20, 2022.
The estimated total expenses of the issue (excluding commissions of the managers) amount to EUR 50,000. The Issuer will not charge any costs, expenses or taxes directly to any investor in connection with the Notes. Investors must, however, inform themselves about any costs, expenses or taxes in connection with the Notes which are generally applicable in their respective country of residence, including any charges their own depository banks charge them for purchasing or holding securities.
D.2 Why has the Base Prospectus been produced?
D.2.1 Reasons for the offer/Use and estimated net amount of proceeds
The Issuer will use the net proceeds of the issuance for general corporate purposes, including the refinancing of existing financial liabilities.
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The estimated net proceeds from the issue of the Notes amount to EUR 744,825,000.
D.2.1 Subscription agreement
The issue of the Notes is subject to a subscription agreement dated September 15, 2022 on a firm commitment basis.
D.2.2 Material conflicts of interest
So far as the Issuer is aware, no person involved in the offer of the Notes has an interest material to the offer, except that certain Dealers and their affiliates may be customers of, and borrowers from the creditors of the Issuer and its affiliates. In addition, certain of the Dealers and their affiliates have engaged, and may in future engage, in investment banking and/or commercial banking transactions with, and may perform services for the Issuer or its affiliates in the ordinary course of business.
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German Translation of the Summary for the Individual Issue
Zusammenfassung für die Einzelemission
ABSCHNITT A: EINLEITUNG MIT WARNHINWEISEN
Diese Zusammenfassung bezieht sich auf die Serie EUR 750.000.000 3,875 % Schuldverschreibungen fällig 20. September 2027 mit der ISIN XS2530444624 (die Schuldverschreibungen), ausgegeben durch die Fresenius Medical Care AG & Co. KGaA, Else-Kröner-Straße 1, 61352 Bad Homburg vor der Höhe, Deutschland (tel.: +49-6172-609-0; Website: www.freseniusmedicalcare.com; LEI: 549300CP8NY40UP89Q40) (die Emittentin und, zusammen mit ihren konsolidierten Konzerngesellschaften, die Gruppe, auch als wir, uns oder unser bezeichnet) aus dem EUR 10.000.000.000 Anleihemissionsprogramm der Emittentin (das Programm).
Die Commission de Surveillance du Secteur Financier (CSSF), 283 Route d'Arlon, L-1150 Luxembourg (tel. +352 26 25 1 - 1; Fax: +352 26 25 1 – 2601; E-Mail direction@cssf.lu) hat den Basisprospekt für das Programm (der Basisprospekt) als zuständige Behörde nach der Verordnung (EU) 2017/1129 am 17. Mai 2022 gebilligt.
Diese Zusammenfassung wurde in Übereinstimmung mit Artikel 7 der Verordnung (EU) 2017/1129 erstellt und sollte als Einleitung zu dem Basisprospekt sowie den jeweiligen Endgültigen Bedingungen verstanden werden. Der Anleger sollte sich bei jeder Entscheidung, in die Schuldverschreibungen zu investieren, auf den Basisprospekt als Ganzes, einschließlich aller durch Verweis darin aufgenommenen Dokumente, und die maßgeblichen Endgültigen Bedingungen stützen. Ein Anleger könnte gegebenenfalls das gesamte angelegte Kapital oder einen Teil davon verlieren. Für den Fall, dass vor einem Gericht Ansprüche aufgrund der in dem Basisprospekt oder den maßgeblichen Endgültigen Bedingungen enthaltenen Informationen geltend gemacht werden, könnte der als Kläger auftretende Anleger nach nationalem Recht die Kosten für die Übersetzung dieses Basisprospekts und der jeweiligen Endgültigen Bedingungen vor Prozessbeginn zu tragen haben. Zivilrechtlich haften nur diejenigen Personen, die die Zusammenfassung samt etwaiger Übersetzungen vorgelegt und übermittelt haben, und dies auch nur für den Fall, dass die Zusammenfassung, wenn sie zusammen mit dem Basisprospekt und den jeweiligen Endgültigen Bedingungen gelesen wird, irreführend, unrichtig oder widersprüchlich ist oder dass sie, wenn sie zusammen mit dem Basisprospekt und den jeweiligen Endgültigen Bedingungen gelesen wird, nicht die Basisinformationen vermittelt, die in Bezug auf Anlagen in die Schuldverschreibungen für die Anleger eine Entscheidungshilfe darstellen würden.
ABSCHNITT B: BASISINFORMATIONEN ÜBER DIE EMITTENTIN
B.1 Wer ist die Emittentin der Wertpapiere?
B.1.1 Sitz und Rechtsform der Emittentin, ihre LEI, für sie geltendes Recht und Land der Eintragung
Die Emittentin ist eine nach deutschem Recht errichtete und deutschem Recht unterliegende Kommanditgesellschaft auf Aktien (KGaA) mit einer Aktiengesellschaft (AG) als alleiniger Komplementärin und mit ihrem satzungsmäßigen Sitz in Hof an der Saale, Deutschland. Die LEI der Emittentin lautet 549300CP8NY40UP89Q40.
B.1.2 Haupttätigkeiten
Die Haupttätigkeit der Emittentin besteht darin, als Holdinggesellschaft für ihre Tochtergesellschaften zu fungieren, die Dialysedienstleistungen und damit verbundene Dienstleistungen für Personen, die an Nierenerkrankungen im Endstadium leiden, sowie andere Gesundheitsdienstleistungen erbringen und die eine Vielzahl von medizinischen Produkten entwickeln und herstellen, die sowohl Dialyse- als auch Nicht-Dialyseprodukte umfassen.
B.1.3 Hauptanteilseigner
Zum 31. März 2022 bestand das Grundkapital der Emittentin aus 293.027.279 ausgegebenen Stammaktien. Die Fresenius SE & Co. KGaA (Fresenius SE) hielt zum 31. März 2022 rund 32,2% der Stammaktien der Emittentin.
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Die Fresenius SE ist zudem Eigentümerin von 100 % des ausstehenden Aktienkapitals der Komplementärin der Emittentin und hat das alleinige Recht, den Aufsichtsrat der Komplementärin der Emittentin zu bestimmen. Durch ihre Beteiligung an der Komplementärin der Emittentin ist die Fresenius SE in der Lage, de facto die Kontrolle über die Emittentin auszuüben, auch wenn sie weniger als die Mehrheit der ausstehenden stimmberechtigten Aktien der Emittentin besitzt. Die Else Kröner-Fresenius-Stiftung ist alleinige Aktionärin der Fresenius Management SE, der Komplementärin der Fresenius SE, und hat das alleinige Recht, den Aufsichtsrat der Fresenius Management SE zu wählen. Darüber hinaus hielt die Else Kröner-Fresenius Stiftung zum 31. Dezember 2021 rund 26,6% des Aktienkapitals der Fresenius SE.
B.1.4 Identität der Hauptgeschäftsführer
Die alleinige Komplementärin der Emittentin ist die Fresenius Medical Care Management AG (Management AG). Als Komplementärin ist die Management AG alleine für die Geschäftsführung der Emittentin einschließlich aller außerordentlichen Geschäftsführungsmaßnahmen verantwortlich und vertritt die Emittentin bei ihren Geschäften mit Dritten allein. In ihrer Eigenschaft als Komplementärin der Emittentin handelt die Management AG durch ihren Vorstand (Vorstand). Der Vorstand besteht aus Rice Powell, Helen Giza, William Valle, Dr. Katarzyna Mazur-Hofsäß und Franklin W. Maddux.
Wie bereits bekanntgegeben, wird Dr. Carla Kriwet die Nachfolge von Rice Powell, dem Chief Executive Officer und Vorsitzenden des Vorstands, antreten. Dr. Kriwet wird das Amt mit Wirkung zum 1. Oktober 2022 übernehmen. Rice Powell gibt zum 30. September 2022 nach 10 Jahren an der Spitze der Emittentin seine Position ab.
B.1.5 Identität des Abschlussprüfers
Die PricewaterhouseCoopers GmbH Wirtschaftsprüfungsgesellschaft, Friedrich-Ebert-Anlage 35-37, 60327 Frankfurt am Main, Deutschland (PwC), ein Mitglied der Wirtschaftsprüferkammer, Berlin, Deutschland, wurde für die zum 31. Dezember 2021 und 2020 endenden Geschäftsjahre zur Abschlussprüferin der Emittntin bestellt.
B.2 Welches sind die wesentlichen Finanzinformationen über die Emittentin?
Die folgenden ausgewählten konsolidierten Finanzinformationen wurden aus unseren nach IFRS aufgestellten Konzernabschlüssen für die sechs Monate endend zum 30. Juni 2022 sowie für die zum 31. Dezember 2021 und 2020 endenden Geschäftsjahre entnommen oder daraus abgeleitet. PwC hat die Konzernabschlüsse für die zum 31. Dezember endenden Geschäftsjahre 2021 und 2020 geprüft und auf diese uneingeschränkte Bestätigungsvermerke erteilt. Die ausgewählten konsolidierten Finanzinformationen zum 30. Juni 2022 und 2021 wurden unserem ungeprüften verkürzten Konzernzwischenabschluss zum 30. Juni 2022 entnommen oder daraus abgeleitet, der in Übereinstimmung mit IFRS für Zwischenberichterstattung (IAS 34) erstellt wurde. Unser ungeprüfter verkürzter Konzernzwischenabschluss wurde auf einer Grundlage erstellt, die im Wesentlichen mit unseren geprüften Konzernabschlüssen übereinstimmt. Diese Informationen sollten zusammen mit unseren Konzernabschlüssen und dem Anhang zu diesen Abschlüssen gelesen werden, die mittels Verweis in den Basisprospekt aufgenommen wurden.
Ausgewählte Zahlen aus der Konzern-Gewinn- und Verlustrechnung
| | Für die sechs Monate endend | | Für das Geschäftsjahr | ||||
In Mio. €, mit Ausnahme Beträge je Aktie |
| 2022 |
| 2021 |
| 2021 |
| 2020 |
Umsatzerlöse | | 9.305 | | 8.530 | | 17.619 | | 17.859 |
Bruttoergebnis vom Umsatz | | 2.604 | | 2.491 | | 5.077 | | 5.537 |
Operatives Ergebnis | | 688 | | 898 | | 1.852 | | 2.304 |
Konzernergebnis (Ergebnis, das auf die Anteilseigner der Emittentin entfällt) | | 305 | | 468 | | 969 | | 1.164 |
Ergebnis je Aktie (unverwässert) | | 1,04 | | 1,60 | | 3,31 | | 3,96 |
Ergebnis je Aktie (verwässert) | | 1,04 | | 1,60 | | 3,31 | | 3,96 |
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Ausgewählte Zahlen aus der Konzern-Bilanz
|
| Zum 30. Juni |
| Zum 31. Dezember | ||
In Mio. € |
| 2022 |
| 2021 |
| 2020 |
Summe Vermögenswerte | | 36.070 | | 34.367 | | 31.689 |
Summe kurzfristige Verbindlichkeiten(1) | | 6.877 | | 7.258 | | 6.056 |
Summe Verbindlichkeiten | | 20.619 | | 20.388 | | 19.358 |
Nettofinanzverbindlichkeiten(2) | | 12.634 | | 11.838 | | 11.298 |
Summe Eigenkapital | | 15.451 | | 13.979 | | 12.331 |
(1)Um der Berichterstattung der Zahlen für 2021 zu entsprechen, wurden in der Konzernbilanz zum 31. Dezember 2020 "Rückstellungen und sonstige kurzfristige Verbindlichkeiten" im Zusammenhang mit dem Selbstversicherungsprogramm der Emittentin in Höhe von EUR 103.409 Tausend in die Position "Rückstellungen und sonstige langfristige Verbindlichkeiten" umgegliedert. Die dargestellte Zahl ist daher dem Konzernabschluss zum 31. Dezember 2021 entnommen.
(2) | Ungeprüft. Nettofinanzverbindlichkeiten, eine Non-GAAP-Kennzahl, ist definiert als die Summe unserer Finanzverbindlichkeiten und Verbindlichkeiten aus Leasingverhältnissen abzüglich unserer flüssigen Mittel. Finanzverbindlichkeiten und Verbindlichkeiten aus Leasingverhältnissen umfassen die folgenden Bilanzpositionen: Kurzfristige Finanzverbindlichkeiten gegenüber konzernfremden Dritten, kurzfristige Finanzverbindlichkeiten gegenüber nahestehenden Unternehmen, kurzfristig fälliger Anteil der langfristigen Finanzverbindlichkeiten, kurzfristig fälliger Anteil der Verbindlichkeiten aus Leasingverhältnissen gegenüber konzernfremden Dritten, kurzfristig fälliger Anteil der Verbindlichkeiten aus Leasingverhältnissen gegenüber nahestehenden Unternehmen, langfristige Finanzverbindlichkeiten abzüglich des kurzfristig fälligen Anteils, Verbindlichkeiten aus Leasingverhältnissen gegenüber konzernfremden Dritten abzüglich des kurzfristig fälligen Anteils und Verbindlichkeiten aus Leasingverhältnissen gegenüber nahestehenden Unternehmen abzüglich des kurzfristigen Anteils, wie sie in unserer Konzernbilanz zum 31. Dezember 2021 und 2020 und der ungeprüften Konzernbilanz zum 30. Juni 2022 dargestellt sind. |
Ausgewählte Zahlen aus der Konzern-Kapitalflussrechnung
| | Für die sechs Monate endend | | Für das Geschäftsjahr endend | ||||
In Mio. € |
| 2022 |
| 2021 |
| 2021 |
| 2020 |
Cash Flow aus betrieblicher Geschäftstätigkeit | | 910 | | 1.129 | | 2.489 | | 4.233 |
Cash Flow aus Investitionstätigkeit | | (409) | | (473) | | (1.196) | | (1.335) |
Cash Flow aus Finanzierungstätigkeit | | (995) | | (378) | | (1.024) | | (2.664) |
Flüssige Mittel am Ende des Zeitraums | | 1.025 | | 1.408 | | 1.482 | | 1.082 |
B.3 Welches sind die zentralen Risiken, die für die Emittentin spezifisch sind?
Die wichtigsten Risiken in Bezug auf die Emittentin und die Gruppe sind:
Risiken im Zusammenhang mit rechtlichen und regulatorischen Themen
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| ● | Änderungen im Vergütungssystem, der Zusammensetzung der Kostenträger und/oder der gesetzlichen Vorschriften des Gesundheitswesens könnten zu einem erheblichen Rückgang unserer Umsatzerlöse und unseres operativen Gewinns führen. |
Risiken in Bezug auf interne Kontrolle und Unternehmensführung
· | Wir sind in vielen verschiedenen Rechtsordnungen tätig und wir könnten durch eine Verletzung des U.S. Foreign Corrupt Practices Act und weltweit vergleichbarer anderer Anti-Korruptions-Gesetze beeinträchtigt werden. |
Risiken in Bezug auf unsere Geschäftstätigkeiten und unsere Branche
| ● | Wir unterliegen Risiken im Zusammenhang mit öffentlichen Gesundheitskrisen und Epidemien/Pandemien wie der weltweiten Ausbreitung der COVID-19-Pandemie. |
| ● | Sollten Ärzte und andere Dienstleister keine Patienten mehr an unsere Gesundheitsdienstleistungseinrichtungen oder Kliniken überweisen oder unsere Erzeugnisse nicht mehr erwerben oder verschreiben, würde dies einen Rückgang unserer Umsatzerlöse zur Folge haben. |
Risiken in Bezug auf Steuern und Rechnungslegung
| ● | Es bestehen erhebliche Risiken im Zusammenhang mit der Schätzung der Höhe der von uns erfassten Umsätzerlöse aus Gesundheitsdienstleistungen, die sich auf den Zeitpunkt der Umsatzrealisierung auswirken oder einen wesentlichen Einfluss auf unsere Ertrags- und Finanzlage haben könnten. |
| ● | Abweichende Ansichten der Finanzbehörden könnten zu zusätzlichen Steuerzahlungen führen. |
Risiken in Bezug auf unsere Finanzlage und Unternehmensstruktur
| ● | Unsere Verschuldung könnte uns daran hindern, unseren Schuldendienstverpflichtungen nachzukommen oder bestimmte Elemente unserer Geschäftsstrategie umzusetzen. |
| ● | Ungeachtet unserer bestehenden Verschuldung könnten wir noch erheblich mehr Schulden aufnehmen. Dies könnte die oben beschriebenen Risiken verstärken. |
ABSCHNITT C: BASISINFORMATIONEN ÜBER DIE WERTPAPIERE
C.1 Welches sind die wichtigsten Merkmale der Wertpapiere?
C.1.1 Art, Gattung und ISIN
Die Schuldverschreibungen sind festverzinsliche Schuldverschreibungen. Sie werden unter der Seriennummer 7, Tranchennummer 1, ISIN XS2530444624 ausgegeben.
C.1.2 Währung, Stückelung, Nennwert, Anzahl der begebenen Wertpapiere und Laufzeit
Die Schuldverschreibungen sind in Euro begeben. Die festgelegte Stückelung je Schuldverschreibung ist EUR 1.000. Die Anzahl der Schuldverschreibungen beträgt 750.000. Die Laufzeit der Schuldverschreibungen beträgt fünf Jahre.
C.1.3 Mit den Wertpapieren verbundene Rechte
Jeder Inhaber von Schuldverschreibungen (jeweils ein Gläubiger) hat aus ihnen das Recht, Zahlungen von Zinsen und Kapital von der Emittentin zu verlangen, wenn diese Zahlungen gemäß den Emissionsbedingungen der Schuldverschreibungen (die Emissionsbedingungen) fällig sind. Soweit nicht zuvor bereits zurückgezahlt oder angekauft und entwertet, wird jede Schuldverschreibung am Fälligkeitstag zum Nennbetrag zurückgezahlt.
Negativverpflichtung: Die Schuldverschreibungen enthalten eine eingeschränkte Negativverpflichtung.
Kündigungsgründe: Die Schuldverschreibungen sehen Kündigungsgründe vor, die die Gläubiger berechtigen, die unverzügliche Rückzahlung der Schuldverschreibungen zu verlangen.
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Cross-Default: Die Schuldverschreibungen enthalten eine Cross-Default-Bestimmung.
Kontrollwechsel: Bei Eintritt bestimmter Kontrollwechselereignisse, die mit einer Ratingherabstufung eintreten, sind die Gläubiger berechtigt, von der Emittentin den Rückkauf ihrer Schuldverschreibungen zu 101% des Nennbetrags zuzüglich etwaiger aufgelaufener und noch nicht gezahlter Zinsen zu verlangen.
Vorzeitige Rückzahlung: Die Schuldverschreibungen können vor Ablauf ihrer festgelegten Laufzeit nach Wahl der Emittentin aus steuerlichen Gründen oder innerhalb eines bestimmten Wahl-Rückzahlungszeitraums gekündigt und vorzeitig zurückgezahlt werden. Die Schuldverschreibungen können ferner nach Wahl der Emittentin bei geringfügigem ausstehendem Nennbetrag gekündigt und vorzeitig zurückgezahlt werden.
Beschlüsse der Gläubiger: In Übereinstimmung mit dem Gesetz über Schuldverschreibungen aus Gesamtemissionen (SchVG) enthalten die Schuldverschreibungen Bestimmungen, nach denen die Gläubiger der Schuldverschreibungen (mit Zustimmung der Emittentin) eine Änderung der Emissionsbedingungen oder sonstige Maßnahmen im Hinblick auf die Schuldverschreibungen beschließen können. Ordnungsgemäß – entweder in einer Gläubigerversammlung oder im Wege einer Abstimmung ohne Versammlung gemäß den Emissionsbedingungen – gefasste Beschlüsse der Gläubiger sind für alle Gläubiger verbindlich. Beschlüsse, welche Änderungen wesentlicher Inhalte der Emissionsbedingungen vorsehen, bedürfen einer Mehrheit von mindestens 75% der teilnehmenden Stimmrechte. Beschlüsse, welche andere Änderungen vorsehen, werden mit einfacher Mehrheit der teilnehmenden Stimmrechte gefasst.
Anwendbares Recht: Die Schuldverschreibungen unterliegen deutschem Recht.
C.1.4 Rang der Wertpapiere in der Kapitalstruktur der Emittentin im Fall einer Insolvenz
Die Schuldverschreibungen begründen nicht besicherte und nicht nachrangige Verbindlichkeiten der Emittentin, die untereinander und mit allen anderen gegenwärtigen und künftigen nicht besicherten und nicht nachrangigen Verbindlichkeiten der Emittentin gleichrangig sind, soweit diesen Verbindlichkeiten nicht durch zwingende Bestimmungen ein Vorrang eingeräumt wird.
C.1.5 Beschränkungen der freien Handelbarkeit der Wertpapiere
Entfällt. Die Handelbarkeit der Schuldverschreibungen ist nicht beschränkt.
C.1.6 Angaben zur Ausschüttungspolitik (Verzinsung)
Die Schuldverschreibungen werden vom 20. September 2022 (einschließlich) zu einem festen Zinssatz von jährlich 3,875 Prozent bezogen auf ihre festgelegte Stückelung verzinst. Die Zinsen sind nachträglich an jedem Zinszahlungstag zahlbar.
Zinszahlungstag bezeichnet den 20. September eines jeden Jahres; der erste Zinszahlungstag ist der 20. September 2023.
Fälligkeitstag: Soweit nicht zuvor bereits ganz oder teilweise zurückgezahlt oder angekauft und entwertet, werden die Schuldverschreibungen am 20. September 2027 zu ihrem Nennbetrag zusammen mit den Zinsen ab dem letzten Zinszahlungstag bis zum (aber nicht einschließlich) Fälligkeitstag zurückgezahlt.
Rendite bei Endfälligkeit: Die Rendite bei Endfälligkeit entspricht 3,957 % per annum.
C.2 Wo werden die Wertpapiere gehandelt?
Für die Schuldverschreibungen ist ein Antrag auf Notierung in der Official List der Börse Luxemburg und Zulassung zum Börsenhandel am regulierten Markt der Börse Luxemburg gestellt worden.
C.3 Wird für die Wertpapiere eine Garantie gestellt?
C.3.1 Art und Umfang der Garantie
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Die Fresenius Medical Care Holdings, Inc (die Garantiegeberin), eine mittelbar vollständig von der Emittentin gehaltene Tochtergesellschaft, hat eine unbedingte und unwiderrufliche Garantie für die ordnungsgemäße und pünktliche Zahlung von Kapital und Zinsen auf die Schuldverschreibungen sowie von jeglichen sonstigen Beträgen, die auf die Schuldverschreibungen zahlbar sind, übernommen (die Garantie). Die Garantie enthält Freigabemechanismen bei Eintritt von bestimmten, in der Garantie dargelegten Umständen. Die Garantie unterliegt deutschem Recht und stellt einen Vertrag zu Gunsten der Gläubiger als begünstigte Dritte im Sinne des § 328 Absatz 1 des Bürgerlichen Gesetzbuches dar.
C.3.2 Beschreibung der Garantiegeberin
Der juristische Name der Garantiegeberin ist "Fresenius Medical Care Holdings, Inc." und ihr LEI ist XTHT88D08CLK11B3GJ82. Da in den USA kein allgemeines Gesellschaftsrecht auf Bundesebene existiert, ist sie organisiert und besteht gemäß dem Business Corporation Law des Bundesstaates New York. Ihre Geschäftsräume befinden sich in 920 Winter Street, Waltham, Massachusetts, 02451-1457, USA, und ihre Telefonnummer lautet +1 (781) 699-9000.
C.3.3 Wesentliche Finanzinformationen über die Garantiegeberin
Die folgenden ausgewählten Finanzinformationen wurden aus den geprüften nach U.S. GAAP aufgestellten Konzernabschlüssen der Garantiegeberin für die zum 31. Dezember 2021 und 2020 endenden Geschäftsjahre entnommen oder daraus abgeleitet. PricewaterhouseCoopers LLP hat die Konzernabschlüsse der Garantiegeberin für die zum 31. Dezember 2021 und 2020 endenden Geschäftsjahre geprüft und auf diese einen uneingeschränkten Bestätigungsvermerk erteilt. Diese Informationen sollten zusammen mit den Konzernabschlüssen der Garantiegeberin und dem Anhang zu diesen Abschlüssen gelesen werden, die mittels Verweis in den Basisprospekt aufgenommen wurden.
Ausgewählte Zahlen aus der Konzern-Gewinn- und Verlustrechnung
| | Für das Geschäftsjahr endend zum | ||
In Mio. US$ |
| 2021 |
| 2020 |
Umsatzerlöse aus Gesundheitsdienstleistungen, netto | | 13.003 | | 12.956 |
Umsatzerlöse aus medizinischem Zubehör | | 1.290 | | 1.279 |
Aufwendungen | | 12.776 | | 12.580 |
Ergebnis vor Ertragsteuern | | 1.517 | | 1.656 |
Ergebnis | | 1.187 | | 1.287 |
Auf nicht beherrschende Anteile entfallendes Ergebnis | | 286 | | 300 |
Auf die Garantiegeberin entfallendes Ergebnis | | 901 | | 987 |
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Ausgewählte Zahlen aus der Konzern-Bilanz
|
| Zum 31. Dezember | ||
In Mio. US$ |
| 2021 |
| 2020 |
Summe Vermögenswerte | | 27.201 | | 27.635 |
Summe kurzfristige Verbindlichkeiten | | 4.322 | | 4.506 |
Summe Verbindlichkeiten | | 15.026 | | 15.661 |
Summe Eigenkapital | | 10.864 | | 10.728 |
Nettofinanzverbindlichkeiten(1) | | 9.584 | | 10.120 |
(1) | Ungeprüft. Nettofinanzverbindlichkeiten ist eine Non-GAAP-Kennzahl. Wir definieren Nettofinanzverbindlichkeiten als die Summe der Finanzverbindlichkeiten und Verbindlichkeiten aus Leasingverhältnissen der Garantiegeberin abzüglich der flüssigen Mittel der Garantiegeberin (einschließlich flüssiger Mittel mit Verfügungsbeschränkung). Die Finanzverbindlichkeiten und Verbindlichkeiten aus Leasingverhältnissen der Garantiegeberin umfassen die folgenden Bilanzpositionen: kurzfristige Darlehen gegenüber nahestehenden Unternehmen, kurzfristig fälliger Anteil der Verbindlichkeiten aus operativen Leasingverhältnissen, kurzfristige Darlehen, kurzfristig fälliger Anteil der langfristigen Finanzverbindlichkeiten, langfristige Finanzverbindlichkeiten, langfristige Darlehen gegenüber nahestehenden Unternehmen und langfristige Verbindlichkeiten aus operativen Leasingverhältnissen, wie sie in der Konzern-Bilanz der Konzernabschlüsse der Garantiegeberin für die zum 31. Dezember 2021 und 2020 endenden Geschäftsjahre dargestellt sind. |
Ausgewählte Zahlen aus der Konzern-Kapitalflussrechnung
| | Für das Geschäftsjahr endend zum | ||
In Mio. US$ |
| 2021 |
| 2020 |
Cash Flow aus betrieblicher Geschäftstätigkeit | | 1.341 | | 3.049 |
Cash Flow aus Investitionstätigkeit | | 245 | | (1.959) |
Cash Flow aus Finanzierungstätigkeit | | (1.324) | | (878) |
Flüssige Mittel am Ende des Jahres | | 940 | | 679 |
C.3.4 Die wesentlichsten Risikofraktoren, die für die Garantiegeberin spezifisch sind
| ● | Die Garantiegeberin bezieht im Wesentlichen alle ihre Erträge von ihren Tochtergesellschaften, und ihre Struktur als Holdinggesellschaft kann die Fähigkeit der Garantiegeberin einschränken, von den Vermögenswerten ihrer Tochtergesellschaften zu profitieren. Zudem ist die Garantie strukturell nachrangig gegenüber den Verbindlichkeiten der Garantiegeberin, soweit diese Verbindlichkeiten durch Vermögenswerte besichert sind, die nicht zugleich die Schuldverschreibungen besichern. |
C.4 Welches sind die zentralen Risiken, die für die Wertpapiere spezifisch sind?
Risiken in Bezug auf die Beschaffenheit und den Rang der Wertpapiere
| ● | Die Schuldverschreibungen sind strukturell nachrangig gegenüber den Forderungen anderer Gläubiger von Nicht-Garantiegebern innerhalb der Gruppe. |
| ● | Die Schuldverschreibungen und die Garantie sind besicherten Verbindlichkeiten der Emittentin und der Garantiegeberin gegenüber insoweit nachrangig, als diese Verbindlichkeiten durch Vermögenswerte besichert sind, die nicht auch die Schuldverschreibungen besichern. |
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| ● | Sowohl die Emittentin als auch die Garantiegeberin sind auf Ausschüttungen ihrer Tochtergesellschaften angewiesen, um ihren Zahlungsverpflichtungen nachzukommen. |
| ● | Wir sind im Fall eines Kontrollwechsels möglicherweise außerstande auf Verlangen Schuldverschreibungen zurückzuzahlen. |
Risiken im Hinblick auf die Garantiegeberin und die Garantie
| ● | Die Gesetze des Bundes wie auch der Bundesstaaten in den USA erlauben es den Gerichten, unter bestimmten Umständen die Garantie für nichtig zu erklären und von den Anleihegläubigern die Rückzahlung der von der Garantiegeberin erhaltenen Zahlungen zu verlangen. |
ABSCHNITT D: BASISINFORMATIONEN ÜBER DAS ÖFFENTLICHE ANGEBOT VON WERTPAPIEREN UND/ODER DIE ZULASSUNG ZUM HANDEL AN EINEM GEREGELTEN MARKT
D.1 Zu welchen Konditionen und nach welchem Zeitplan kann ich in dieses Wertpapier investieren?
Für die Schuldverschreibungen ist ein Antrag auf Notierung in der Official List der Börse Luxemburg und Zulassung zum Börsenhandel am regulierten Markt der Börse Luxemburg gestellt worden.
Die Schuldverschreibungen werden durch die Emittentin nicht öffentlich angeboten. Die Zustimmung zu der Verwendung des Prospekts und der Endgültigen Bedingungen zu der späteren Weiterveräußerung und der endgültigen Platzierung der Schuldverschreibungen durch alle Finanzintermediäre wird von der Emittentin in Bezug auf Luxemburg und Deutschland erteilt. Die spätere Weiterveräußerung und endgültige Platzierung der Wertpapiere durch Finanzintermediäre kann während der Angebotsfrist erfolgen, die am 15. September 2022 beginnt und am 20. September 2022 endet.
Die geschätzten Gesamtkosten der Emission (ausschließlich Provisionen der Manager) betragen EUR 50.000. Die Emittentin wird den Anlegern im Zusammenhang mit den Schuldverschreibungen keine Kosten, Auslagen oder Steuern direkt in Rechnung stellen. Anleger müssen sich jedoch über Kosten, Auslagen oder Steuern im Zusammenhang mit den Schuldverschreibungen, die in ihrem jeweiligen Wohnsitzland allgemein anfallen, einschließlich etwaiger Gebühren, die ihnen ihre eigene Depotbank für den Kauf oder das Halten von Wertpapieren berechnet, selbst informieren.
D.2 Weshalb wurde dieser Basisprospekt erstellt?
D.2.1 Zweckbestimmung der Erlöse und geschätzte Nettoerlöse
Die Emittentin wird die Nettoerlöse der Emission für allgemeine Geschäftszwecke, einschließlich der Refinanzierung bestehender Finanzverbindlichkeiten, verwenden.
Die geschätzten Nettoerlöse der Emission der Schuldverschreibungen betragen EUR 744.825.000.
D.2.1 Übernahmevertrag
Die Emission der Schuldverschreibungen ist Gegenstand eines Übernahmevertrages mit fester Übernahmeverpflichtung vom 15. September 2022.
D.2.2 Wesentliche Interessenkonflikte
Nach Kenntnis der Emittentin bestehen bei den an der Emission beteiligten Personen keine Interessen, die für das Angebot bedeutsam sind, außer, dass bestimmte Platzeure und mit ihnen verbundene Unternehmen Kunden von, Kreditnehmer der oder Kreditgeber der Emittentin und mit ihr verbundener Unternehmen sein können. Außerdem sind bestimmte Platzeure an Investment Banking Transaktionen und/oder Commercial Banking Transaktionen mit der Emittentin oder mit ihr verbundenen Unter-nehmen beteiligt oder könnten sich in Zukunft daran beteiligen.
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Exhibit 31.1
CERTIFICATION PURSUANT TO SECTION 302
OF THE SARBANES-OXLEY ACT OF 2002
I, Helen Giza, certify that:
1. | I have reviewed this report on Form 6-K of Fresenius Medical Care AG & Co. KGaA (the “Report”); |
2. | Based on my knowledge, this Report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this Report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this Report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this Report; |
4. | As the registrant’s certifying officer, I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and I have: |
a) | designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this Report is being prepared; |
b) | designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c) | evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this Report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this Report based on such evaluation; and |
d) | disclosed in this Report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | I have disclosed, based on my most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent function): |
a) | all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
b) | any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
Date: October 31, 2022
Exhibit 32.1
CERTIFICATION PURSUANT TO
18 U.S.C.SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the report of Fresenius Medical Care AG & Co. KGaA (the “Company”) on Form 6-K furnished for the month of October 2022 containing its unaudited financial statements as of September 30, 2022 and for the three-month and nine-month periods ending September 30, 2022 and 2021, as submitted to the Securities and Exchange Commission on the date hereof (the “Report”), the undersigned, Helen Giza, Deputy Chief Executive Officer and Chief Financial Officer of the Company, certifies, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:
(1) | The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
(2) | The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company. |