Operations and Business Environment - Fresenius Medical Care

02. 6
Our Fiscal year
Taxes
For 2007, we expect the tax rate to be about 39 %.
The discussed corporate tax reform in Germany should
have only marginal effects on the tax rate of Fresenius
Medical Care. We also expect a tax rate of about 39 %
for 2008.
Financing
Driven by earnings performance and ongoing good
accounts receivables, the operating cash flow is expected
to be within the target range of 9 % to 11% of
total revenue in the next fiscal year. It should be within
a comparable percentage range of revenue in 2008.
We maintain a sufficient financial cushion which consists
of only partly utilized bilateral and syndicated
credit facilities and the accounts receivable facility. We
will refinance the debt maturing in 2007 and 2008
with similar instruments. This covers the accounts receivable
facility and the trust-preferred securities issued by
Fresenius Medical Care Capital Trust II and III. Additional
information can be found in Note 12 on page 81 of the
financial report.
Generally, we expect to have the appropriate financing
to achieve our goals in the future and to continue to
promote the growth of the Company.
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In its long-term financial planning, Fresenius Medical
Care takes the debt / EBITDA ratio as a guideline. This
ratio compares the debt of our company to our Earnings
Before Interest, Tax, Depreciation and Amortization
and other non-cash charges. The debt / EBITDA ratio
was 3.23 at the end of 2006 due to the acquisition
of Renal Care Group.
Our company seeks to reduce the debt / EBITDA ratio
to below 3.0 by the end of 2007, and we expect a
further reduction in 2008. In the long term, we strive
for a debt / EBITDA ratio of approximately 2.5.
Important Key Figures – an Overview
Results 2006 Goals 2007 Goals 2008
Revenue growth
Net income growth 1
Capital expenditures and acquisitions
(excl. RCG)
Debt / EBITDA ratio
Employees 2
Dividend
$ 8.5 billion
$ 574 million
$ 609 million
3.23
56,803
Proposal of a dividend
increase by 15 % per
ordinary share
11% to $ 9.4 billion
18 %–21%
~ $ 650 million
Below 3.0
More than 60,000
Continuous increase
6 %–9 %
More than 10 %
~ $ 650 million
Below 3.0
More than 62,000
Continuous increase
Research and Development
expenditures
Product innovations
$ 51 million
New PD solutions
introduced and online-HDF
further expanded
~ $ 60 million
Further expansion
of products
and services range
~ $ 60 million
Further expansion
of products
and services range
1
2006 excluding one-time effects and FAS 123(R)
2
Full-time equivalents
Fresenius Medical Care 2006