WALTHAM,
Mass., Nov. 21, 2023 /PRNewswire/ -- Fresenius
Medical Care, the world's leading provider of products and services
for individuals with renal diseases, resolved a legal dispute with
the U.S. government, for accounts receivable in legal dispute, and
entered into a final and legally binding settlement agreement
today, whereby the company will receive a payment from the U.S.
government.
Fresenius Medical Care had filed a complaint against
the United States in 2019. This
complaint sought to recover monies owed to the company by the U. S.
Department of Defense under the Tricare program, for services on or
before January 11, 2023.
Tricare provides reimbursement for dialysis treatments and other
medical care provided to members of the military services, their
dependents and retirees. The litigation challenged unpublished
administrative actions by Tricare administrators to reduce the rate
of compensation paid for dialysis treatments provided to Tricare
beneficiaries based on a recasting of invoicing codes. Tricare
administrators had acknowledged the unpublished administrative
action and declined to change or abandon it.
The now executed settlement agreement resolves the dispute
underlying the complaint and concludes the litigation.
As a consequence of the settlement agreement, both revenue and
operating income will be positively impacted. In previous reporting
periods, the negative impact related to this matter had not been
treated as special item due to its operational nature. Fresenius
Medical Care therefore expects a net positive impact on operating
income (guidance basis)1 of approx. EUR 175 million in the 4th quarter
2023.
The company had previously expected in fiscal year 2023
operating income (guidance basis)1 to grow by a
low-single-digit percentage rate, compared to previous year (2022
basis: EUR 1,540 million).
As a consequence of the settlement agreement, Fresenius Medical
Care today raises its earnings outlook. The company now expects
operating income (guidance basis)1 to grow by 12 to 14
percent in fiscal year 2023, compared to previous year. All other
elements of the 2023 outlook, as published, remain unchanged.
In line with its disciplined financial policy, Fresenius Medical
Care intends to use the agreed settlement payment to reduce its net
financial debt and therefore deleverage the balance sheet.
Fresenius Medical Care is the world's leading provider of
products and services for individuals with renal diseases of which
around 3.9 million patients worldwide regularly undergo dialysis
treatment. Through its network of 4,014 dialysis clinics, Fresenius
Medical Care provides dialysis treatments for approximately 342,000
patients around the globe. Fresenius Medical Care is also the
leading provider of dialysis products such as dialysis machines or
dialyzers. Fresenius Medical Care is listed on the Frankfurt Stock
Exchange (FME) and on the New York Stock Exchange (FMS).
For more information visit the Company's website at
www.freseniusmedicalcare.com.
Disclaimer:
This release contains forward-looking statements that are subject
to various risks and uncertainties. Actual results could differ
materially from those described in these forward-looking statements
due to various factors, including, but not limited to, changes in
business, economic and competitive conditions, legal changes,
regulatory approvals, impacts related to the COVID-19 pandemic
results of clinical studies, foreign exchange rate fluctuations,
uncertainties in litigation or investigative proceedings, and the
availability of financing. These and other risks and uncertainties
are detailed in Fresenius Medical Care AG & Co. KGaA's reports
filed with the U.S. Securities and Exchange Commission. Fresenius
Medical Care AG & Co. KGaA does not undertake any
responsibility to update the forward-looking statements in this
release.
|
|
|
|
|
|
|
|
|
|
|
|
1
|
Operating income, as
presented in the outlook, is on a constant currency basis and
excluding special items. Special items will be provided as separate
KPI ("Operating income excluding special items") to capture effects
that are unusual in nature and have not been foreseeable or not
foreseeable in size or impact at the time of giving guidance. These
items are excluded to ensure comparability of the figures presented
with the Company's financial targets which have been defined
excluding special items.
As described in FME's public reports for FY 2022, special items
included costs related to the FME25 program, the impact of the war
in Ukraine, the impact of hyperinflation in Turkiye, the Humacyte
investment remeasurement and the net gain related to InterWell
Health. Additionally, the FY 2022 basis for the 2023 outlook was
adjusted for U.S. Provider Relief Funding. For FY 2023, special
items include costs related to the FME25 program, the Humacyte
investment remeasurement, the costs associated with the legal form
conversion and effects from legacy portfolio
optimization.
|
Media Contact
Leif
Heussen
T +49 6172 608-4030
leif.heussen@fresenius.com
Contact for analysts
and investors
Dr. Dominik
Heger|
T +49 6172 609-2601
dominik.heger@fmc-ag.com
www.freseniusmedicalcare.com
View original content to download
multimedia:https://www.prnewswire.com/news-releases/fresenius-medical-care-enters-into-favorable-settlement-agreement-with-u-s-government-with-positive-earnings-impact-of-approx-eur-175-million--2023-earnings-outlook-raised-301995275.html
SOURCE Fresenius Medical Care Holdings, Inc.
