Asklepios: growth in revenue and earnings in first nine months of 2016 exceeds group’s own forecast

The Asklepios Group is building on the good business performance in the first half of the year and has increased its revenue and earnings to above the forecast level. Rising patient numbers and an increase in valuation ratios contributed to this success. In the first nine months of 2016, a total of 1,718,513 patients were treated at one of its 150 healthcare facilities – a 2.9 % increase in comparison to the previous year. Overall, the company improved all of the group’s key figures in comparison to the previous year.

Further increase in profitability

The group’s revenue climbed by 4.1 % year on year to a total of EUR 2.4 billion (9M 2015: EUR 2.3 billion). Earnings before interest, taxes, depreciation and amortisation (EBITDA) increased by 6.0 % to EUR 281.6 million (9M 2015: EUR 265.7 million), corresponding to an EBITDA margin of 11.7 % (9M 2015: 11.5 %). The comparatively lower rise in the cost of materials increased profitability in the first nine months of the year. As a result of efficiency enhancements, Asklepios was able to reduce the cost of materials ratio by 0.5 percentage points to 21.6 % (9M 2015: 22.1 %). The staff costs ratio was 63.0 % (9M 2015: 63.8 %). Consolidated interim income for the first nine months of 2016 totalled EUR 138.5 million (9M 2015: EUR 135.1 million). The return on sales was on a par with the previous year at 5.8 % (9M 2015: 5.8 %).

“The very good business performance in the first three quarters of this year shows that our growth strategy is bearing fruit. It is based on a solid foundation: the expansion of our high-performance medical centres, the Centres of Excellence, investments in the existing facilities and targeted acquisitions along our value chain. With this clear strategic focus, we are well equipped to continue Asklepios’ success story, even in an environment characterised by increasing regulatory challenges,” comments Kai Hankeln, CEO.

Stable financial basis secures future development

Equity amounted to approximately EUR 1.2 billion as at 30 September 2016 (31 December 2015: EUR 1.2 billion). It thus provides a sound financial basis for further growth of the Asklepios Group. At 34.2 %, the equity ratio is slightly lower than at the end of the financial year 2015 (31 December 2015: 34.7 %). The debt ratio improved to 1.3 times EBITDA (31 December 2015: 1.6x). Net debt as at the end of the reporting period amounted to EUR 507.4 million (31 December 2015: EUR 595.9 million).

Investments to further improve patient care increased

In the period from January to September 2016, the Asklepios Group increased its investments in hospitals and healthcare facilities by 8.4 % to a total of EUR 150.2 million. The share of investments made with the group’s own funds was financed entirely from cash flow from operating activities, which amounted to EUR 271.9 million as at 30 September 2016 (9M 2015: EUR 234.7 million). In the first nine months of 2016, these funds were used in particular for measures to improve patient care and for the strategic expansion of the Centres of Excellence. The construction projects for nine high-tech operating theatres and an intensive care unit for newborns in Hamburg were completed in September. A total of EUR 30.0 million was invested in these projects.

Optimised equity investment and financing structure

“By means of targeted financing measures, we further harmonised and optimised the financing structure in the group as a whole in the first nine months of 2016. The key steps here were the amendment and extension of the syndicated loan, the refinancing of the syndicated loan at MediClin AG and the repayment of existing bilateral loans at operating unit level. We have stepped up the announced measures to simplify the historically evolved and rather complex corporate and equity investment structure and aim to complete this process in the first quarter of 2017,” says CFO Hafid Rifi.

Revenue forecast for year as a whole increased

“Based on the very positive business performance in the first nine months of 2016, we expect to exceed our previous revenue forecast for the year as a whole. Asklepios previously anticipated a year-on-year increase in revenue of between 2.0 % and 3.5 %. With regard to our EBITDA development, we are still forecasting a slight but sustainable increase compared to the previous year. The equity ratio is also expected to increase slightly in the financial year as a whole,” says Dr Thomas Wolfram, CEO, commenting on the outlook for the financial year 2016.

The report on the third quarter of 2016 as at 30 September 2016 is available at www.asklepios.com/ir.

About Asklepios

The healthcare group Asklepios Kliniken GmbH is among the leading private operators of hospitals and healthcare facilities in Germany. The hospital group stands for highly professional care of its patients with a clear commitment to medical quality, innovation and social responsibility. On this basis, Asklepios has been developing dynamically ever since it was founded more than 30 years ago. The group currently has 150 healthcare facilities across Germany. Its facilities include acute hospitals providing all levels of care, specialist clinics, psychiatric and forensic facilities, rehabilitation clinics, nursing homes and medical centres. In the 2015 financial year, 2.3 million patients were treated in the Asklepios Group’s facilities. The company has approximately 46,000 employees.