Fresenius Se & Co

Good afternoon and welcome to the conference call of Fresenius Investor Relations, which is now starting. May I hand you over to next go and head of investor relations.

Thank you, Valentina. Hello, everyone. Welcome to our half year in Q2 2025 earnings call and webcast. The presentation was emailed to our distribution list earlier today and is available on Fresenius.com. On slide two of the presentation, you'll find the usual safe harbour statements. Unless stated otherwise, we'll comment on our performance using constant exchange rates or CER. Today, I'm delighted to be joined by Michael and Sarah who will take you through the guidance raised in another resilient business performance in these uncertain and volatile times. As usual, the call will last approximately one hour with the presentation taking around 35 minutes and the remaining time for your questions to give everyone the chance to participate Please limit your questions to one to two. We can always come back for a second round if needed. And with that, I will now hand the call over to Michael to kick things off.

Thank you, Nick, and welcome to everyone joining us today. Future Fresenius keeps delivering. Our momentum continues with another quarter of performance. driven by resiliency and consistency of strong execution across the individual businesses within CABI and Helios. Persistent macroeconomic volatility and emerging geopolitical tensions have led to a challenging operational environment in the first half of this year. However, we delivered another strong print with 8% core EPS growth, reflecting good operational progress and the continued execution of our future Fresenius strategy. Our direction remains unchanged. We've evolved into a simpler, more focused, adaptive, competitive and performance-driven company. This is supported by a cultural shift that fosters accountability and a strong results-oriented mindset. This change has led to consistent and disciplined execution with a significantly stronger portfolio and a strengthened balance sheet providing the flexibility to navigate uncertainty while securing the delivery of our long-term ambitions. We are a relevant, system-critical healthcare company. Across our platforms, we deliver real impact for patients, caregivers, and hospitals around the world. We're also advancing our sustainability agenda, reflecting in our recently improved ISS ESG rating from B- to B, a positive step into the right direction. Our mission stands firm. We are committed to life. Now let's turn to the second quarter and the highlights of the quarter. Given the excellent performance in the first half, particularly on the strong top-line growth, we are raising our full-year organic revenue guidance from 46 to 527. I'm also especially encouraged by the sustained strength of our bottom line. Core EPS increased by 8%. driven by operating demand and a significant decrease in interest expense. In the first half, we now have 10% core EPS growth, and we expect this excellent momentum to continue. CABI contributes to our enhanced profitability, delivering a strong 16.4% EBIT margin within the upper half of our full year range. This result is particularly impressive given the expected adverse impact of our nutrition business in China following the keto tender loss as part of VBP. Biopharma has once again demonstrated strong year-over-year EBIT margin expansion. At the beginning of the year, we laid out an ambitious rollout plan for CAVI, I am pleased to report that the execution against this plan is well underway with strong progress across both our ID generics and fluids and biosimilars pipeline, fully in line with expectations. Similarly, our performance program, which we kick-started at Helios, is advancing as we speak. with further anticipated value expected to be realized in the second half of this year and obviously beyond. Now let's double-click on our core businesses. Starting with Kabi, in pharma we launched six new IV generic products in the U.S. in the second quarter. Great to see the strong momentum as we aim for 10-plus launches this year in this high cash generative business. Our US IV solutions business continues to grow supported by the ramp up of production at our Wilson, North Carolina site to meet growing customer demand for supply chain security. With supply levels now restored and surgical volumes as well as chronic disease treatments continuing to increase, we see a clear upward trend in demand. I would even say we picked up share. We clearly see how important it is to be a relevant player in essential medicines, a stable backbone for future investments and strong contributor to our balance sheet. Moving to nutrition, we are driving innovation through continued investments in R&D to further advance and differentiate our enteral and parenteral portfolio. In MedTech, our cell and gene therapy segment delivered an outstanding 40% organic year-over-year growth in Q2. This was driven by the continued adoption of our LOVO and Q cell processing system, great progress in a highly attractive and fast-growing market cell and gene therapy. In biopharma, our positive momentum continued with the EU regulatory approval of denosumab biosimilar. We anticipate launching in Europe towards the end of this year. In the U.S., we launched our denosumab biosimilar already in July. At the same time, our Tocilizumab biosimilar, Tyane, has gained further market share, achieving 24% in EO5. It has also been approved in Brazil, meanwhile, an important and attractive market for us. Moreover, Fresenus Cabi has just signed an in-license deal to commercialize and market the autoimmune biosimilar Virulizumab. an integrin receptor antagonist used in the treatment of ulcerative colitis or Crohn's disease. This exciting milestone underpins our strategy to bolster our biosimilar pipeline to become an even more relevant player in this attractive field. Congratulations to the entire biopharma team for this achievement. Overall, these developments demonstrate our commitment to delivering accessible, high-quality biologic medicines to patients. Staying with biopharma, a market that is not only accelerating in momentum, but also holds significant strategic importance for us. With a current global market size of around 20 billion and expected 20% increase CAGR through the early 2030s, biosimilars represents a highly attractive growth opportunity, particularly in Europe and the US, the two largest markets. Looking ahead, the global loss of exclusivity, LOE, the value of that loss over the next three years is estimated at 40 billion euros, including 17 billion euros in the US alone. We've structured our commercial organization to be ready and capitalize on this opportunity with an increasingly broad portfolio and vertically integrated clinical development and manufacturing capabilities. From a market adoption and diffusion perspective, we continue to see dynamic trends. While Europe is an already more established market for biosimilars, the U.S. is catching up meaningfully. Biosimilar penetration there now exceeds 40%, more than double the level in 2020. Even though there are still complexities around market access, we expect this trend to accelerate further and help to significantly reduce U.S. healthcare costs. For biosimilars already launched in the U.S., the data we have confirms a strong uptake and broad acceptance across prescribers and payers, despite some of the market hurdles we just mentioned. This continues to be a very exciting space. We're well positioned to capture long-term value for patients, providers, and shareholders. Let's take a closer look at the recent launch of Otulfi or Ustekinumab, a medicine for treating conditions like moderate to severe glycerosis, Crohn's disease, and ulcerative colitis. This is a large and highly attractive market with a total value of around 11 billion euros, the majority of which is concentrated in the U.S. Following the regulatory approval in September last year in the U.S. and EU, we've now launched in 10 markets, leveraging our established commercial infrastructure in autoimmune diseases to drive this early momentum. Our dual formulations, we have SC and IV, enhance the flexibility for both prescribers and patients. And in May this year, the US FDA granted an interchangeability designation, which means the medicine can be dispensed at the pharmacy as a substitute for the reference product. With a well-positioned product offering, we have signed various contracts in the US and expect the ramp-up to accelerate over the coming quarters, including just recently signing an agreement with Civica Script, who will be acting as exclusive US distributor of Fresenius Kabi's unbranded Ustekinoma product as our customer. Market dynamics are also trending in our favor. Since the first launch of an Ustekinoma biosimilar, the class has continued to grow and we've seen strong and consistent adoption across major European countries. With our strong customer relationships and integrated commercial infrastructure, we are very well positioned to capture significant value in this very space. Now, moving to Tyen or Totsilizumab, we are progressing, and as of Q2, we have already launched in 22 markets in this highly attractive $3 billion market. With our biosimilars, we were first to market and benefited from so-called first-move-at-handage, which is reflected in Tyen's current market shares. we have seen sequential market share growth in key regions with 24% in the EU5 and encouraging momentum in the US. We expect uptake to remain strong throughout the remainder of the current fiscal year 2025, while in parallel, we continue to advance our tech transfer to MapScience, where we just recently received the European approval for our Garin site in Argentina. With the successful completion of the reset and revitalized phase of Future for Zenith, we are now seeing the tangible benefits of the structural transformation. The simplification of our business, the enhanced strategic and performance-driven focus, and renewed momentum across the organization are clearly paying off. Looking at Kabi, our growth vectors are contributing more within the business, exactly as we had envisioned when we launched the transformation of Fresenius. The growth vectors are not only delivering an accelerated top-line growth, but are also significantly enhancing our margin profiles. Over the past two years, Kabi has delivered an impressive 13% EBIT CAGR, validating our strategy and operational execution. In parallel, we've also made structural improvements to our cost base, which continue to support margin expansion. Our growth vectors are the key engine behind the elevated profitability. Since 2022, the growth vectors margin expanded by an outstanding 630 base points. And our established pharma portfolio continues to provide a strong, resilient, and profitable foundation. Looking ahead, we're confident that this positive trajectory will continue, underpinned by increasing contribution from biopharma, improving profitability step-by-step in medtech, and continued product momentum in nutrition also going into 2026. Now let's turn to Q2 highlights in our care provision platform, Helios. In Germany, we are continuing to advance the nationwide rollout of what we call the clustering strategy, strengthening ingrained regional care delivery and driving higher quality care outcomes through better integration and scale. In addition, we were encouraged that the government approved a $4 billion financial support for the hospitals as part of their federal budget. For Helios, this should be positive news as hospitals are expected to benefit from the funding via a surcharge applied for the treatment of publicly insured patients served in November 2025 until October 31st, 2026. In Spain, Chiron Salud continues to lead in AI and digital transformation. As a front runner in healthcare digitalization, our agentic AI tool Scribe was launched in 2024 and has been used for more than 1 million medical consultations so far. Scribe can automatically transcribe conversations between doctor and patient in real time, identifying clinically relevant elements and generating a structured outcome report, including discharge letters. This process enhances consultation quality while optimizing patient care. Our proprietary patient portal, Cassiopeia, is also driving healthcare digital transformation even further. Today, virtually all all performed medical activity is registered on this very platform. The combination of AI and digital tools is creating a seamless end-to-end experience for patients and providers, improving access and health outcomes. When we look at our two core segments and across all three platforms, pharma slash biopharma, medical technology, medtech, and care provision, we see structurally accelerated revenue growth as our future business strategy continues to unfold. With more focused business models, we're now delivering sustainable, stronger, organic, and profitable growth. At Kabi, our growth vectors remain the key driver of the group's top-line acceleration. Since we hit reset, the group's overall revenue CAGR has improved from 5 between 2019 to 2022 to 7, so 200 base points in the last two years. The growth vectors are even showing an impressive 13% CAGR in the same period. And as you heard earlier, we are increasing this year's organic revenue growth guidance. At Helios, we continue to see solid, reliable organic growth numbers, reinforcing the resilience of our care provision platforms. In terms of capital allocation, our priority remains clear. We will focus on investing in organic growth with Rejuvenate. We're upgrading our core. scaling our platforms for relevance and thus elevating our performance for the entire group. With that, I'll hand it over to Sarah.