Asklepios Group: Sound business performance in first nine months of 2023

Asklepios Kliniken GmbH & Co. KGaA recorded sound business performance in the first nine months of 2023. Important aspects of the hospital reform, such as hospital funding and combating the shortage of specialist staff, have not yet been clarified. Consolidated net income was negatively impacted by higher material and staff costs.

As in the previous year, a total of 2.6 million patients were treated at the Asklepios Group’s healthcare facilities in the first nine months of the current financial year. The number of full-time equivalents also remained unchanged as against the previous year at around 50,000.

Asklepios generated year-on-year revenue growth of 3.6% to EUR 4,077.7 million (9M 2022: EUR 3,935.4 million). Staff costs climbed by EUR 156.1 million or 6.0% year-on-year to EUR 2,739.0 million due to general collective wage increases, with the staff costs ratio rising from 65.6% to 67.2% as a result.

Inflation-driven price increases led to higher purchasing costs for food and medical supplies. Compared to the previous year, the cost of materials rose by 4.1% to EUR 993.0 million. The cost of materials ratio increased to 24.4% after the first nine months of the year (9M 2022: 24.2%).

The overall increase in expenses had an impact on consolidated net income (EAT), which declined year-on-year to EUR 81.9 million after the first nine months of 2023 (9M 2022: EUR 104.9 million). The EAT margin was also lower at 2.0% (9M 2022: 2.7%).

“Asklepios has achieved sound business performance despite the challenging environment. Unfortunately, there are currently no signs of a sustainable improvement in the conditions for hospitals in Germany. Although the urgently needed hospital reform presents a major opportunity, its implementation does not seem conducive to the provision of modern, future-proof healthcare,” says Kai Hankeln, CEO of Asklepios Kliniken.

Hafid Rifi, CFO of Asklepios Kliniken: “In a generally volatile market environment, the situation in many German hospitals is getting worse. Securing hospitals’ liquidity is a top priority for Asklepios, as these hospitals are indispensable for people in rural areas in particular. The challenges of the unsettled market necessitate forward-looking financial planning with a strategic mindset in order to ensure the future viability of our facilities.”

To expand its strategic liquidity reserve, Asklepios has increased the syndicated loan that was concluded with a syndicate of eleven banks on 12 August 2021, which has a residual term until 2028 following the successful exercise of both renewal options, by a further EUR 200.0 million to a total volume of EUR 750.0 million.

Despite the uncertain market environment, Asklepios Kliniken is aiming for a sustainable overall improvement in operating earnings in 2023 as a whole.