Fresenius Se & Co Reg Shs

Good afternoon and welcome to the conference call of Resinius Investor Relations which is now starting. May I hand you over to Nick Stone, Head of Investor Relations.

Thanks Valentina. Hello everyone. Welcome to our year-to-date and Q3 2026 earnings call and webcast. The presentation was emailed to our distribution list this morning and is available on resinius.com. On slide 2 of the presentation you'll find the usual State Harbour Statement. Unless stated otherwise, will discuss performance at constant exchange rates, and growth references will refer to organic growth. I'm pleased to welcome Michael and Sara, who will take you through the results and what they mean for the continued delivery of future presenters. As usual, the call will last approximately one hour, with the presentation taking around 30 minutes, with the remaining time for your questions. To give everyone a chance to participate, please limit your questions to one to two, and we can always come back for a second round as needed. I'll now hand over to Michael to discuss our performance and the improved output.

Yeah, thank you Nick and welcome to everyone joining us today. I'm very pleased to report another excellent quarter for Fresenius, one that reinforces the structural improvement in our performance. We continue to deliver health and organic growth, double-digit core EPS growth and strong operating cash generation while further Improving Our Return. From this position of operational strength, we are improving our full-year core EPS growth guidance and now expect to reach the upper half of 10 to 15% range at constant currency. Sara and I will take you through the key operational and financial highlights in a moment. But first, let me highlight what matters most about this quarter. Presenius continues to deliver. We're building on the structural improvements achieved through our transformation. Q3, once again, makes progress evident through a durable, higher quality operational performance, resulting in strong earnings growth and improving returns. In fact, we achieved the highest ROIC in this decade. Our growth vectors are increasingly driving revenue and Earnings Growth. This tectonic shift, which is testament to the success of our strategy, is strengthening the business for the long term. We're now doubling down and are scaling our growth vectors decisively. Our stronger balance sheet provides us with both continued strategic flexibility and resilience, including after our recent Biopharma transaction. We're investing from a position of strength in attractive high growth businesses while remaining disciplined and focused on returns. This is exactly what we said we're gonna do. Upgrade the core, scale our growth vectors for relevance without going against the balance sheet and continuously improve operating performance. We're now seeing the results in our earnings Profitability and Returns. Fresenius is stronger, more focused and better positioned for its next phase of growth. We're building a business that delivers for patients and health systems and creates sustainable value for shareholders at the same time. Q3 builds on our strong first half performance with continued progress across all the businesses. Earnings continue to grow faster than sales, reflecting durable, strong operating performance and continued focus on efficiency and profitable growth. Against the backdrop of a very strong year-to-date group EBIT margin of 11.7%, we're now raising our group margin indication, as we call it, to above 11.5. Cash generation also improved substantially with free cash flow more than doubling year over year. and our discipline focus on returns is paying off with returns continuing to move higher. Taking that all together, the improvement is really broad-based. Organic growth is healthy, earnings are outpacing revenues and returns are moving higher. This is the structural step up in performance we set out to achieve. Now let's move to Fresenius Carpi. First of all, today, I want to congratulate Mark Alexander in his new role as a board member responsible for our businesses within CABI. Having worked closely with him in his previous role as president of Pharma and Nutrition, I look forward to working together with Mark as we advance future Resenius. And then on top of it, we want to strengthen All the very best for the future. Turning to our Q3 highlights, where the Kabi businesses delivered another quarter of broad-based growth. In nutrition, we have further advanced our innovation agenda and broadened our portfolio to address evolving patient needs. The launch of NutriShed is an important step in expanding patient choice in enteral nutrition with a real food-based concept. We have also strengthened our Frisbeen portfolio with two new additions offering patients more tailored nutritional options. Beyond innovation, improving patient access to nutritional care is another important lever for growth. In Germany, mandatory nutrition screening standards for hospitals are expected to be introduced by the end of 2027 with implementation expected from 2028. Systematic screening is a critical first step in identifying patients at nutritional risk and connecting them with appropriate treatment. Turning to metric, the rollout of our IVAN-X infusion system in the US continues to accelerate, driven by very strong customer demand. This quarter, we secured a contract with a large Thank you for joining us today. selling individual products to providing integrated infusion systems. BioPharma remains our standout growth engine, and we continue to strengthen this very platform across both commercial execution and manufacturing capabilities. In the US, we have expanded direct-to-payer access to three competitively priced biosimilars through a new partnership with Wals Health, supporting our efforts to broaden access to high-quality, affordable biological therapies through innovative commercial partnerships. In Brazil, the regulatory authority, Anvisa, has approved the technology transfer of Tyene to our Garin facility, marking further progress in expanding our manufacturing capability. In Pharma, we continue to strengthen our manufacturing footprint with new IV product lines in Poland and Italy, expanding European capacity and supporting a more resilient healthcare supply chain in and for Europe. At the same time, we have further expanded our portfolio in the US with the launch of Sugamidex in a pre-filled syringe and Ney Kadepitan in a pre-mixed bag bringing greater convenience to healthcare professionals. Overall, Kavi is increasingly becoming what we envisioned when we launched Vision 2026, a higher earnings quality healthcare platform driven by innovation-led growth and attractive opportunities. In Q3, our biopharma business continued to strengthen its position as an increasingly important growth engine, reflecting strong commercial execution across our in-market portfolio. Let me put the recent US formulary development for Tian into perspective. As expected, following the UNH Optum formulary changes, Tian moved from preferred to non-preferred status. This was part of the trade-off we faced between maintaining preferred status and ensuring we could reliably meet demand across the spectrum. Importantly, this does not change our view of Thailand's underlying strength. U.S. demand continues to exceed our current supply. The market is growing dynamically with volumes increasing by 45% year over year. We have secured additional supply to meet this strong demand and our expanding capacity. Also, our biopharma strategy goes well beyond any single product. We are building a broad, diversified, and globally balanced biosimilars portfolio across multiple molecules and therapeutic areas, creating a scalable and repeatable growth engine. Our exclusive development agreement with Wuxi further accelerates this very ambition. securing option rights for up to 37 potential first-to-market biosimilar candidates. This expands our portfolio from 29 marketed and pipelined molecules today to up to 66 over the next decade, targeting originated products with combined sales of more than $370 billion. We are already seeing the benefits of our broader portfolio in our growth, Our Denussumab and Ustekinumab biosimilars continue to expand our presence across key markets. Vomintra, our Denussumab biosimilar for ecology, is seeing particularly strong uptake of PFS, supported by its differentiated product profile. Overall, BioPharma is scaling across products and geographies, increasingly contributing to Fresenius' growth earnings and reinforcing our confidence in raising our long-term ambitions for the business. Now let me briefly address our ongoing quality initiatives at Fresenius CABI, including the latest developments at Melrose Park. Quality is fundamental to CABI and firmly embedded in how we operate. Under our new management, strengthening quality will remain key as a key priority going forward. As part of Rejuvenate, we are further enhancing quality management and continuously improving processes across our global manufacturing network. Digitization and AI are increasingly supporting these efforts, enabling greater standardization, transparency and efficiency, including more streamlined batch release, robust workflows and earlier risk detection. Turning specifically to Malrose Park, we continue to work closely and constructively with the agency, with the FDA, following the recent inspection. The facility remains fully operational and we have no patient safety concerns arising from the observations. Based on our current assessment, we continue to expect no material impact on production, supply or full year 2026 financial performance. Mitigation measures are already underway. Furthermore, our broader U.S. manufacturing network provides additional operational flexibility also going forward. Turning to our care provision businesses, Helios and Chiron Salon. In Germany, the reimbursement environment continues to develop, if anything, more constructively. The DOG inflator of 4.85% for 2027 is an important element in this regard, while 450 million in additional funding provides additional, albeit small, support. Beyond the constructive reimbursement environment, we see the ongoing structural transformation of the German hospital landscape as an opportunity for our system Helios. As we have consistently emphasized, scale, quality, and operational excellence will become increasingly important areas where Helios is very well positioned. Our position at the intersection of healthcare and technology is also gaining further momentum. NVIDIA's planned investment in Avelios Medical, in which Fresenius is invested, represents a strong validation of the digital healthcare ecosystem we're building together with SAP and Avelios. Turning to Spain, Chiron Salud continues to demonstrate how technology can translate into tangible improvements in healthcare delivery. Our in-house developed ambient AI solution, Scribe, has now been used in more than 10 million consultations. Peer review research supports its potential to reduce the documentation burden while maintaining quality. This is a concrete example of how we're embedding AI directly into clinical workforce to improve productivity and free up clinicians' time to focus what really matters, i.e. patients, without compromising our high standards of medical quality and obviously care. Looking ahead, there are exciting developments across our hospital franchise. We will continue to strengthen operational performance accelerate AI and digitization initiatives and drive further improvements in quality, productivity and efficiency across our network. As I said at the beginning, the progress we have made over the past several years has created greater strategic as well as financial flexibility. We're now putting that flexibility to work, investing selectively in attractive opportunities where we see the potential to create sustainable long-term value. Biopharma is a prime example. Our acquisition of the remaining state of map science gives us now full ownership of a fully vertically integrated biopharma business with a scalable, cost-competitive development and manufacturing platform. This strengthens our position and provides a solid foundation to scale the next wave of biosimilars. Now our exclusive development agreement with WUSHI gives us access to capabilities in a market where speed and scale are critical. It provides a scalable path to potentially triple our portfolio while for Xenius retains strategic control, exclusive global commercialization rights and the full economics of each product. The flexible fee-for-service model allows us to scale investment as selected programs advance and direct capital towards the most compelling opportunities. This agreement is additive, almost like a new venture or almost like the next growth cycle where we then now deploy growth capital. Our 2030 ambition to double biopharma revenue at an EBIT margin of around 20% which relates to the existing marketed and late-stage portfolio remains unchanged. With the agreement, we're expanding the opportunity beyond 2030 and expected to raise our long-term biopharma ambition significantly with the goal of becoming a top three player in the very attractive biosimilar and biopharma market. Together, full ownership of MapScience and the WUSHI agreement gives us greater control over manufacturing, a scalable development model, and the flexibility to allocate capital to the most attractive programs while maintaining financial discipline. Our focus on growth-oriented portfolio is increasingly visible in our results, with margin expanding as our growth vectors scale. Our strategy is working. Businesses that were emerging opportunities only a few years ago are now making material contributions to growth and earnings. Innovation is an important part of this progress. Over the last 12 months, new products generated roughly $850 million in revenue, demonstrating their contribution to our growth. Following the launch of Vision 2026, our growth vectors accounted for roughly 33% of CABI's EBIT in 2023. In the first nine months of 2026, that share had nearly doubled to 55%. They now also contribute roughly one third of group EBIT. This represents a fundamental shift in our earnings means. Our growth factors have moved beyond potential to become established drivers of earnings today with attractive margins and structural growth opportunities. The key point is that we are not starting from scratch. We're scaling businesses that have already demonstrated their ability to deliver. And now over to Sara.