Fresenius Medical Care AG(US:FMS)2026-02-24 17:41Financial Performance - As of December 31, 2025, the company had cash and cash equivalents of €1,599 million, an increase from €1,180 million as of December 31, 2024[500]. - For the year ended December 31, 2025, the company reported revenue of €19,628 million, up from €19,336 million in 2024[503]. - Net cash provided by operating activities for 2025 was €2,681 million, representing 13.7% of revenue, an increase from 12.3% in 2024[503]. - Free cash flow for 2025 was €1,782 million, which is 9.1% of revenue, compared to 8.8% in 2024[503]. - The company's net debt as of December 31, 2025, was €9,196 million, down from €9,803 million in 2024[501]. - The net leverage ratio improved to 2.5 in 2025 from 2.9 in 2024[501]. - Capital expenditures in 2025 amounted to €899 million, accounting for approximately 5% of total revenue[512]. - The company anticipates capital expenditures between €0.8 billion and €1.0 billion in 2026, focusing on organic growth and new production facilities[516]. - The company utilized €1,403 million in net cash for financing activities in 2025, primarily for debt repayment and share buybacks[518]. - Days Sales Outstanding (DSO) improved to 59 days as of December 31, 2025, down from 63 days in 2024[507]. - The total dividend payments for 2025, 2024, and 2023 were €423 million, €349 million, and €329 million, respectively[522]. - As of December 31, 2025, the company had available liquidity sources totaling €3.307 billion, including a syndicated credit facility of €2 billion and other unused lines of credit of €1.307 billion[525]. - Total assets decreased by 8% to €31.0 billion as of December 31, 2025, from €33.6 billion in 2024, primarily due to a 9% negative impact from foreign currency translation[530]. - The equity ratio decreased to 46% at December 31, 2025, compared to 47% in 2024, driven by a decrease in shareholders' equity and treasury stock purchases[531]. - The return on invested capital (ROIC) increased to 5.0% at December 31, 2025, from 3.5% in 2024, due to higher operating income and reduced costs related to Legacy Portfolio Optimization[531]. - The company plans to propose a dividend of €1.49 per share for 2025, resulting in an expected total payment of approximately €416 million[528]. - The principal financing needs for 2026 include bond repayments and share repurchases, expected to be covered by cash flow and existing credit facilities[529]. Research and Development - The global R&D strategy focuses on developing innovative products and therapies for renal care, including digital health solutions and AI-supported care models[539]. - In 2025, the Renal Research Institute undertook several R&D initiatives aimed at enhancing patient care through personalized and precision medicine[541]. - The Clinical Research team supported commercialization efforts, including clinical trials and collaborations with start-ups to promote innovation[540]. - In 2025, over 15,300 U.S.-based patients utilized the NxStage portable HHD system, an increase from more than 14,500 in 2024, driven by the introduction of the FDA-approved GuideMe software[554]. - The multiFiltratePRO acute dialysis machine study enrolled 31 patients across ten U.S. clinics, confirming safety and effectiveness, with registration submission for the citrate solution expected in December 2025[545]. - The introduction of the 5008X CAREsystem with HVHDF in the U.S. marks a significant innovation milestone, with initial therapies conducted in 2025 and a commercial launch planned for 2026[560][561]. - Approximately 58,000 therapy prescription programs were delivered remotely in 2025, with over 7.7 million patient treatments digitally transmitted[558]. - The Renal Research Institute's AI applications aim to enhance precision nutrition strategies and improve home dialysis adoption through predictive modeling[549]. - The CE mark for hemoperfusion mode of the multiFiltratePRO platform was obtained in 2025, expanding its capabilities for ICU staff[570]. - Fresenius Medical Care's digitalization efforts focus on therapy data management systems and improving workflow efficiency for healthcare professionals[565]. - The company aims to reduce environmental impact by optimizing the material consumption of its 5008 bloodline portfolio and introducing PVC-free Biofine® foil for dialysate bags[567][572]. - The MFT PRO Adult Study confirmed the performance and safety of the multiFiltratePRO device for continuous kidney replacement therapy, meeting KDIGO targets[546]. - The company strengthened global research partnerships in 2025, enhancing innovation in kidney care through initiatives like the MONDO International Network[550]. - The Apheresis Pathogen Reduction Device (APRΞD) received CE MDR certification in August 2024, with commercial launch planned for January 2026[573]. - Fresenius Kidney Care's R&D expenditure was €158 million in 2025, down from €183 million in 2024, representing 4% of healthcare product revenue[580][583]. - The total number of patents held by the company decreased to 7,890 in 2025 from 9,529 in 2024, with 67 additional patent families produced in 2025[580][583]. - The company doubled its manufacturing capacity and output for heart and lung business in 2025, enhancing supply reliability for extracorporeal life support systems[575]. - The successful regulatory approval of synchronized cardiac support therapy in 2025 represents a significant advancement in ECMO therapy, improving patient outcomes[576]. - The Ready4 multiFiltratePRO AR training application was expanded in 2025 to enhance clinician education with immersive 3D models and dynamic visuals[574]. - The ReferralReady program launched in 2023 aims to streamline the transplant referral process, improving efficiency and increasing patient placements on the kidney transplant waitlist[578][579]. - As of December 31, 2025, the company employed 1,488 R&D staff, an increase from 1,384 in 2024, with over 940 based in Europe[581][583]. - The semi-automated workflow of the ReferralReady program saves dialysis social workers two hours of administration per referral, enhancing their capacity to assist patients[584]. - The Xenios 2.0 console, launched in April 2025, improves connectivity for multiFiltratePRO devices, streamlining data management for healthcare providers[577]. Management and Governance - Ms. Sara Hennicken appointed as Chief Financial Officer of Fresenius SE on September 1, 2022, with prior experience in investment banking and corporate finance[598]. - Mr. Martin Fischer became Chief Financial Officer of the Company on October 1, 2023, previously Head of Finance for Siemens Healthineers' Diagnostics division[611]. - Dr. Jörg Häring appointed to the Management Board responsible for Legal, Compliance, and Human Resources as of June 1, 2024, with extensive experience in legal and compliance roles[613]. - Ms. Helen Giza serves as Chief Executive Officer and Chair of the Management Board, previously held key positions at Takeda Pharmaceuticals and Management AG[610]. - Mr. Craig Cordola appointed as Chief Executive Officer of Care Delivery as of January 1, 2024, with nearly 30 years of experience in the healthcare industry[612]. - Dr. Marcus Kuhnert served as Chief Financial Officer of Merck KGaA until June 30, 2023, bringing significant experience in finance and procurement[600]. - Ms. Pascale Witz has held executive positions at Sanofi S.A. and GE Healthcare, currently serving as president of PWH Advisors[602]. - Mr. Shervin J. Korangy has extensive experience in healthcare and investment, currently a senior advisor to TPG Inc.[599]. - The Management Board members are appointed for a maximum term of five years, with a standard retirement age of 65[609]. - The Company has a diverse Supervisory Board with members from various sectors, enhancing strategic oversight and governance[604]. Compensation and Performance Targets - The overall target achievement for the short-term variable compensation component (STI) for the fiscal year was between 56.01% and 101.58%[624]. - The target achievement for revenue growth in 2023 was reported at 5.5%, with a target of 0.3%[627]. - Net income growth for 2023 was reported at (25.2)%, with a target of (25.9)%[627]. - The return on invested capital (ROIC) for 2023 was adjusted to 2.7%, with a target of 2.8%[627]. - The target achievement for the allocation made in 2023 under the Management Board Long-Term Incentive Plan (MB LTIP 2020) will be determined based on performance in fiscal years 2023, 2024, and 2025[625]. - The compensation system for Management Board members was approved by the Company's 2024 AGM with a majority of 87.58% of the votes cast[636]. - The FME Reignite strategy was implemented in the fiscal year, maintaining the existing compensation system[633]. - Compensation for Management Board members remained unchanged compared to the previous year[632]. - The Company reported a significant adjustment of €71 million and €45 million for operating income and net operating profit after tax, respectively, for the fiscal year 2023 due to one-time costs related to the FME25+ program[629]. - The Management Board members' compensation is designed to align with the Company's strategic objectives and long-term value creation[622]. - The target total direct compensation for the fiscal year 2025 consists of 29% base salary, 31% Short-Term Incentive (STI), and 40% Long-Term Incentive (LTI) for Management Board members[644]. - The STI target amount for fiscal year 2025 is set at a multiplier of 1.05, while the LTI allocation amount is set at a multiplier of 1.35 for all Management Board members[644]. - The maximum compensation for the Chairperson of the Management Board (CEO) is €12,000 K or $12,975 K, while the maximum for the Care Delivery segment CEO is €9,500 K or $10,272 K[660]. - The total compensation of each Management Board member is capped at 150% for STI and 400% for LTI allocations[655][656]. - The compensation structure includes a significant performance-based component, with 71% of the target total direct compensation being performance-based[646]. - The LTI allocation amount for the Chairperson can range from 105% to 200% of the base salary, while for other members it ranges from 105% to 150%[643]. - The Supervisory Board conducts both horizontal and vertical comparisons to ensure the appropriateness of the compensation system[651][653]. - The compensation awarded or due in the fiscal year includes fixed and variable components, with fixed components comprising base salary, fringe benefits, and pension commitments[666][667]. - The Supervisory Board has the authority to withhold or reclaim variable compensation in cases of misconduct or non-compliance[663]. - There were no instances in the fiscal year that warranted the use of caps or maximum compensation adjustments by the Supervisory Board[665]. - The short-term incentive (STI) target amount for fiscal year 2025 is set at 105% of the base salary for each Management Board member[673]. - The STI is based on four performance targets: 20% revenue, 40% operating income, 20% net income, and 20% sustainability-related performance[677]. - For the fiscal year, the group revenue target was €19,399 million, with actual revenue reported at €19,628 million, achieving 126.96% of the target[685]. - The operating income target for the group was €2,136 million, with actual reported income of €1,827 million, achieving 69.80% of the target[685]. - The net income target was set at €1,199 million, with actual net income reported at €978 million, achieving 53.44% of the target[685]. - The sustainability target for the STI achieved an overall score of 115%, with "Patient Satisfaction" at 120% and "Employee Satisfaction" at 110%[694]. - The Net Promoter Score (NPS) for "Patient Satisfaction" was set at a target of 71, with an actual score of 73[691]. - The Global Employee Engagement Score (GEES) target was set at 65, with an actual score of 66[693]. - The STI is paid out in cash in the year following the year of target achievement[678]. - The financial performance targets are adjusted for certain effects to ensure comparability with operational performance[681].