Operations and Business Environment - Fresenius Medical Care

02. 6
Our Fiscal year
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In the field of environmental management, we will
deal with the new EU chemicals regulation REACH
(Registration, Evaluation and Authorisation of Chemicals).
According to this, some 30,000 chemical substances
– with a minimum production volume of one
ton per year – will have to be tested for their impact
on human health and the environment before being
registered in the EU. Particularly risky substances,
which, for example, are carcinogenic or can impair fertility,
will have to go through an approval procedure.
Opportunities
New markets could emerge from changes in the legal
frameworks of individual countries. For example, significant
new market opportunities could arise should
the legal framework for operating dialysis clinics in
Japan change such that private companies could run
dialysis clinics. Japan is the biggest market in Asia with
about 270,000 dialysis patients, which represents half
of all dialysis patients in Asia. Furthermore, populous
countries such as China and India should provide further
growth opportunities in the long-term.
Germany is the fifth-largest market worldwide based
on the number of dialysis patients treated. Here privately
run companies have been allowed to participate in the
operation of dialysis clinics in medical care centers since
the end of 2006. Medical care centers are facilities
managed by doctors with different areas of expertise.
The people working there are either salaried or contractual
physicians. We will use this opportunity to
further strengthen our business in the long term.
In the scope of GOAL 10, Fresenius Medical Care has
decided to become more involved in the area of dialysis
medication. The acquisition of the phosphate binder
(PhosLo) business from Nabi Biopharmaceuticals in
October 2006 was a first major step in this direction.
Other dialysis medications besides phosphate binders
include Vitamin D and iron preparations. We estimate
that the dialysis-related market size for these three
product groups totals nearly $1.5 billion and see opportunities
to further develop our business in this area.
Furthermore, Fresenius Medical Care has a number
of economic opportunities resulting from its operating
business. Among them are an optimized procurement
process and cost-efficient production.
Long-Term Revenue and
Earnings Outlook until 2010
With GOAL 10, Fresenius Medical Care is pursuing a longterm
growth strategy which is explained in detail beginning
on page 50 . GOAL 10 should result in revenue of
about 11.5 billion in 2010. Profitability should grow
stronger than revenue. Our aim is to attain a market
share of 18 %.
General Statement on the
Expected Development
Fresenius Medical Care’s prospects for the coming years
are positive. We expect an organic growth in revenue
of 6 to 9 % p.a. Net income should increase by at least
10 % p. a. At present, all regions are expected to contribute
to the revenue and earnings growth.
In 2007, we plan to complete the integration of Renal
Care Group into our North American business region
and to remain very active in Eastern Europe and other
growth markets. In addition, we intend to further
reduce Fresenius Medical Care’s debt/EBITDA ratio
significantly.
This outlook takes into account all factors known at
the time of the preparation of the financial statements
which could affect our business in 2007 and beyond.
Major risks are discussed in the risk report starting
on page 94
. As in the past, Fresenius Medical Care will do
everything in its power to attain or exceed its goals.
Fresenius Medical Care 2006