Fresenius To Probe State Aid: German healthcare giant Fresenius (FREG.DE) is assessing the impact of state assistance it received. Why shorten the user’s text by 1%? To reduce hospital business energy costs. The main question is if this financial lifeline could hinder bonus and profit payments to managers.
The company’s spokesman states his commitment to understanding the seriousness of the situation. However, the company needs help in a complex investigation of confusing rules and a complicated legal framework. This inspection level demonstrates responsibility and commitment to following rules. The company actively engages with the new German regulatory body to address changing legal frameworks.
In an interview with Frankfurter Allgemeine Sonntagszeitung, CEO Michael Sen discussed legal rules on bonus and dividend payouts after government funding. Sen acknowledged that the law’s ambiguity made it challenging to comprehend, particularly with numerous regulations. He emphasized the need to consider any potential legal case against payout limits carefully.
The company’s commitment to shareholders is evident in its unchanged yearly dividend of 0.92 euros per share, total 518 million euros this year. Fresenius aims to maintain dividend payouts at previous levels. This is because the company links dividend payments to currency-adjusted EPS growth.
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The Helios business, part of Fresenius’s healthcare portfolio, received 88 million euros ($93 million) from the government in H1 2023. The financial report showed the investment was made to offset energy cost increases.
But it is still unclear what will happen next. A spokeswoman said the ongoing review is crucial to determine if state funds can be accepted in the second half of the fiscal year. By staying silent, the company allows people to discuss potential outcomes.
Despite the financial challenges, the Helios division performed admirably. In the first half, it made 622 million euros before interest and taxes, exceeding the previous year’s 609 million euros. Despite Fresenius’ challenges, its solid financial position suggests a potential positive outcome.
CEO Sen has been in charge for just over a year. He must address the company’s financial issues, particularly the decline in profits in the kidney dialysis sector. He implemented a bold restructuring plan to focus on the pharmaceutical industry, particularly Kabi and Helios. This plan included cost-cutting measures, debt reduction efforts, and potentially selling non-core businesses.
Fresenius is led by CEO Sen through a complex mix of laws, finances, and strategy. The company navigates a dynamic healthcare and regulatory landscape.
Our Reader’s Queries
What is the strategy of Fresenius in 2025?
Fresenius Medical Care has set its sights on achieving a better operating income margin of 10-14% by 2025. The outlook for revenue and operating income is based on a constant currency basis and excludes special items. Our goal is to continue to improve our financial performance and provide the best possible care to our patients.
What companies does Fresenius own?
Fresenius is a worldwide healthcare organization that consists of two Operating Companies, Fresenius Kabi and Fresenius Helios, both of which are fully owned by the group. Additionally, there are two Investment Companies, Fresenius Medical Care (with a 32% ownership share) and Fresenius Vamed (with a 77% ownership share).
Who is the owner of Fresenius?
Fresenius is a TypeKommanditgesellschaft auf Aktien with a Societas Europaea partner that has unlimited liability. Their total equity for 2021 is 29.288 billion. The Else Kröner-Fresenius Foundation owns 26.6% of the company. With 316,078 employees in 2021, Fresenius is a major player in the healthcare industry. You can find more information about the company on their website at www.fresenius.com.
What is the dividend policy of Fresenius?
The company maintained its annual dividend of 0.92 euros per share for 2022, totaling 518 million euros. Typically, the company increases the payout per share in accordance with currency-adjusted growth in earnings per share, while at least maintaining the previous year’s level.