Fresenius Medical Care Stock

Ladies and gentlemen, welcome to the Report on Second Quarter 2026 Earnings Release and Conference Call. I am Valentina, the Chorus Call operator. [Operator Instructions] And the conference is being recorded. [Operator Instructions]

At this time, it's my pleasure to hand over to Dr. Dominik Heger. Please go ahead.

Thank you, Valentina. I would like to welcome everyone to our earnings call for the second quarter of 2026. I appreciate your flexibility to join this earlier call. We felt it is more helpful to have the call earlier given that we had to publish earlier than originally planned. I do apologize for the inconvenience, in particular for those of you who are located in a different time zone or those of you who cover another company hosting a call in parallel right now.

As always, I start out the call by mentioning our cautionary language that is in our safe harbor statement as well as in our presentation and in all the materials that we have distributed earlier today. For further details concerning risks and uncertainties, please refer to these documents and to our SEC filings. The call is scheduled for 1 hour. In order to give everyone the chance to ask questions, we limit the number of questions as always. Thank you for making this work.

Let me now welcome Helen Giza, CEO and Chair of the Management Board; and Martin Fischer, our Chief Financial Officer.

Helen, the floor is yours.

Thank you, Dominik, and welcome, everyone, and thank you for joining at this earlier time of the day. I will begin my prepared remarks on Slide 4.

We continued our strong start to the year, delivering another quarter of highly profitable growth, supported by solid organic revenue development and further improvement in profitability. Operating income growth accelerated to 23%, in line with our planned phasing for the year, and we realized another quarter of margin expansion. This was also supported by the continued execution of our FME25+ transformation program, which delivered EUR 67 million of sustainable savings during the quarter.

We also completed our initial EUR 1 billion share buyback program on an accelerated time line and have already launched a second EUR 1 billion program, underscoring our continued focus on disciplined capital allocation and reigniting shareholder returns. With a net leverage ratio of 2.6x, we remain around the lower end of our target corridor and continue to maintain a strong financial position. With that overview, let me turn to the key second quarter highlights across our operating segments on Slide 5.

Beginning with care delivery. The international markets delivered 0.8% same-market treatment growth. In the U.S., same market treatment growth declined by 0.9%. At the same time, I am genuinely encouraged by the progress we are seeing where it matters most for our patients. Our continued focus on quality and patient care is making a real difference. Missed treatments and mortality improved in the quarter. These are outcomes that are deeply meaningful for the patients who rely on us every day and for all of us who are committed to their care. The same market treatment growth declined due to our own clear operational miss in our business development approach to capture our fair market share of referrals. This exposed an execution gap and led to a further softening of referrals in Q2 compared with Q1.

We have promptly addressed this with an organizational change, enabling rapid implementation of the necessary prepared measures. While these measures will take a few months to gain traction, we remain confident in our path to restoring referral rates in the affected areas.

Given the compounding effect of lower first half of referrals from the rest of the year, we now expect U.S. same market treatment growth in 2026 to be around the Q2 level. I also want to recognize the strong execution driving accelerating momentum across several strategic priorities under our Reignite strategy.

We are making significant progress accelerating the rollout of our 5,008X in our clinics in the U.S. We have a dedicated slide on high-volume HDF coming up, where I will provide a further update. As we continue to strengthen our core operations, we remain disciplined in optimizing our clinic network. We have successfully completed the clinic footprint optimization, exiting around 100 select underperforming clinics. We are realizing favorable rates and seeing contributions from our revenue cycle management initiatives, providing further evidence that our operational improvement efforts are gaining traction. As already indicated, we are beginning to see the impact of our catheter-related bloodstream infection preventing efforts. We saw a 23% reduction in bloodstream infections over the past year, which supports lower infected related hospitalizations and also translates into lower patient mortality risk.

Next, on value-based care. We continue to build on the strong momentum we have established in this business. The quarter reflected continued positive operating income as well as an increase in member months driven by contracting growth. We are demonstrating how our vertically integrated model translates into better patient outcomes. We are seeing meaningful improvements across key clinical measures such as reduced miss treatments, lowered mortality and hospitalization rates when FME patients are managed by interwell Health. On October 12, we will host an expert call with Tom O'Connor, the CEO of Value-Based Care, where we will give more insights into this segment. Information about the call is available on our Investor Relations website.

Turning to care enablement. The 5,008X rollout gained also momentum for care enablement with growing sales supporting favorable business growth. Overall, we continue to realize positive pricing and volume development outside of China, driving momentum in our underlying business. Despite recent headwinds from regulatory changes, China remains an attractive products market for FME. With refreshed leadership, we are reviewing our strategy to win as well as our product portfolio for this market.

We are navigating elevated raw material and logistics costs, driven by the conflict in the Middle East. While these external cost pressures remain a headwind and are something we are monitoring closely, they are currently absorbed in our guidance range. This further reinforces the importance of our continued execution of our FME25+ program to drive sustainable savings.

Before I turn to the 5008X update, there are 2 other innovations that I want to highlight. Recently, we introduced -- sorry, recently, we announced the introduction of TherapyWise, a cloud-based analytics capability designed to provide retrospective program level insight into kidney replacement therapy delivered in acute and hospital critical care settings. TherapyWise reflects our continued focus on innovation and critical care by applying data analytics. This helps hospital and clinical leaders gain visibility into how kidney replacement therapy is delivered across their organizations, supporting informed discussions around workflow, consistency and quality improvement. We also launched kinexus, marking a significant milestone in our home dialysis strategy and our broader digital transformation journey.

By bringing peritoneal dialysis and home hemodialysis capabilities together on a single platform, we are creating a more connected experience for patients, caregivers and clinical teams. We have already achieved our patient go live with encouraging initial feedback, and we look forward to expanding adoption as we continue to scale the platform globally. Most importantly, kinexus establishes a global digital foundation that will enable future innovation and help us advance our commitment to delivering high-quality person-centered home care.

Next on Slide 6. I'm excited to update you on the progress we are making with our 5,008X rollout, which is accelerating as planned. We are firmly on track to meet our 2026 targets, including converting around 20% of our machines in our own clinics. By late July, we had converted 227 clinics across 23 states, representing 10% of our machine base. Of the more than 600,000 treatments on the 5008X around 170,000 have been HDF and more than 100,000 high-volume HDF. So far, we have produced 4 million consumables for the 5008X, which is in line with our plan and is rapidly ramping up.

Our extensive planning efforts have covered around 5,000 renal nurses and patient care technicians. It has been a tremendous undertaking to achieve all of this, and I am proud of how much we have accomplished so far.

Last Wednesday, we announced BEACON-US, which is a major research initiative designed to generate real-world evidence for high-volume HDF in routine U.S. clinical practice. This reflects our commitment to bringing innovation to patients thoughtfully, responsibly and with rigorous scientific evaluation at scale. We are encouraged by the positive early experiences we are seeing from both patients and clinicians. To give you some examples, patients report feeling better both and after dialysis. And for example, data shows 40% fewer muscle cramps. More than 70% of treatments using auto subs technology in our research cohorts are already reaching the high-volume HDF target of at least 23 liters of convective volume per session.

Clinical experience suggests simplified clinician workflows, optimize resource utilization, including reduced water consumption and a much quieter overall dialysis clinic experience. Early observations are tracking consistently with previously published international, randomized and real-world studies including the landmark EU-funded CONVINCE study that collectively have associated high-volume HDF with fewer hospitalizations, fewer missed treatments and improved survival outcomes compared with conventional hemodialysis.

I will now hand over to Martin to walk you through the second quarter financials in more detail.

Thank you, Helen, and welcome, everyone. I will continue on Slide 8. In the second quarter, we achieved solid organic group revenue growth of 5%, supported by growth in all 3 operating segments. At constant currency, revenue increased by 4%. Regulatory pressure in China continued to post a challenge to revenue development in care enablement. Divestitures negatively impacted group revenue development by 50 basis points in the second quarter.

For the full year, we continue to assume an unfavorable impact on a year-over-year revenue growth of about 30 basis points from the execution of our portfolio optimization plan in '25 and '26. We significantly increased operating income by 23% at constant currency. This growth was driven by contributions from care delivery and value-based care segments and is in line with our planned phasing for 2026. Special items in the second quarter amounted to a negative EUR 103 million, mainly related to the Tavneos impact. As background, the European Commission recommended a revocation of the Tavneos marketing authorization led to an impairment of intangible assets at Fresenius Medical Care Renal Pharma. That resulted in a negative impact on our income from equity method of EUR 71 million, which was treated as a special item.

Special items further include EUR 42 million, FME25+ onetime costs and also positive effects from the side reevaluation.

I will continue on Slide 9. Our group operating margin again expanded and further improved by 180 basis points. Care delivery as well as value-based care contributed positively. I will cover the drivers of the segment profitability a little bit late. The greater intersegment elimination reflects the growing sales of the 5008X in our clinics in the U.S. With further advancing our rollout, this trend will continue.

Corporate costs increased by EUR 47 million, mainly driven by the impact from virtual power purchase agreement and the planned cost of the strategic IT platform investments as we continue to transition to SAP S/4HANA. In addition, FX translation effect had an impact of negative EUR 19 million this quarter. The average U.S. dollar exchange rate in the second quarter was 1.16 compared to 1.17 in the first quarter, and compared to 1.13 in the second quarter of 2025.

I will now walk you through the business development in each segment, starting with Care Delivery on Slide 10. Care Delivery realized 5% revenue growth at constant currency and organic revenue growth of 7%. In the U.S., organic growth of 7% was supported by the positive impact from TDAPA reimbursement regulations, favorable rates development and continued progress in revenue cycle management initiatives, further enhancing revenue yields. These benefits were partially offset by lower treatment volumes driven by the referral dynamics Helen discussed earlier.

The International business continued to contribute positively. Divestitures, as part of our portfolio optimization negatively impacted revenue growth by around 90 basis points. The main driver here was the prior year divestment of our clinics in Brazil. Care delivery achieved strong earnings growth in line with planned phasing for the year. Accelerating operating income growth to 45% with a 390 basis point step-up in margin. Importantly, underlying operating income, excluding the TDAPA effect, improved by 34%. This improvement was driven by higher rates FME25+ contributions, in particular from the clinic closures as well as benefits from revenue cycle management. Additionally, the growth was supported by a lower prior year base, which includes effects such as elevated medical benefit costs. This more than offset the impact from lower treatment volumes in the United States.

As assumed, benefits from TDAPA reimbursement regulations for phosphate binders and solutions were a driver of earnings with around EUR 18 million year-over-year benefit in the quarter. The TDAPA effects are assumed to be a headwind in the remainder of the year.

Moving on to value-based care on Slide 11. Revenue in value-based care segment grew by 9% on both organic and constant currency basis. This was driven by an increased number of member months and the favorable effect from premium rates. Revenue increase was partially offset by the change of the risk type for a large contract, which resulted in a different type of accounting treatment and lower revenue recognition. Value-Based Care delivered a strong improvement in profitability in the second quarter, with operating income increasing to EUR 18 million from a EUR 9 million loss in the prior year. The margin improved by 500 basis points, marking another profit of the quarter.

Supporting favorable business growth in the quarter was an improved savings rate, reflecting the strength of our contracting. FME25+ savings additionally had a smaller but positive effect on earnings as well.

Looking ahead, due to the positive business development, we expect 26% revenue for value-based care to decline by EUR 150 million to EUR 200 million, which is lower than the initially assumed EUR 300 million decline. I will finish the segment overview with care enablement on Slide 12.

Care Enablement delivered organic revenue growth of 3%, supported by continued positive pricing and volumes outside China. Regulatory measures and stricter tender requirements in China remained a headwind as assumed. However, the underlying momentum across the rest of the business continues to be encouraging with growing sales of the 5008X increasingly contributing to that momentum as well. The enablement earnings declined by 5% in the quarter, reflecting the adverse regulatory impact in China as well as increased inflationary pressure, including higher raw material costs and elevated logistics expenses related to the Middle East conflict.

As the Middle East conflict continues, we are closely monitoring the increasing inflationary pressures and implementing mitigation measures where possible. Currently, these higher costs, especially for raw materials and transportation are absorbed in our guidance range.

For our Care Enablement China business, as expected, we saw a headwind of around EUR 20 million in the second quarter. These negative effects were partially offset by positive volume and price effects outside of China and continued contributions from FME25+ savings.

Next, I will look at cash flow growth on Slide 13. We delivered a strong increase in operating cash flow of 11% in the second quarter, primarily driven by disciplined working capital management. Free cash flow remained stable at EUR 625 million, while we increased our investments in the business, reflecting the continued strength of our underlying cash generation.

Total net debt and lease liabilities as well as total net debt and lease liabilities increased by 6% year-over-year as expected. After canceling 8.5% of shares, which we bought back as part of the share buyback program completed in April of this year, we initiated a new share buyback program starting in May with a total volume of around a further EUR 1 billion. The new program will be executed in tranches over a 12-month period with the first tranche of up to EUR 600 million expected to be completed by mid-December.

By the end of the second quarter, we already repurchased 2.5 million shares for EUR 94 million, representing 0.9% of total share capital and approximately 16% of the first tranche. After initiating our new share buyback program, we continue to maintain a net leverage ratio of 2.6x, remaining around the lower end of our target corridor of 2.5 to 3x and underscoring the strength of our balance sheet and disciplined approach to capital allocation.

I will now hand back to you, Helen.

Thank you, Martin. I will pick up with our outlook on Slide 15. We continue to expect a broadly flat revenue development. For earnings, our priority is to sustain the higher level of profitability established in 2025. Accordingly, we expect operating income to remain at a consistently elevated level in 2026 with an upside downside range of a mid-single-digit percentage change. While we do not provide quarterly phasing, we communicated that we expected a strong first half earnings contribution in 2026, supported by the mentioned underlying earnings improvement and positive TDAPA effects. TDAPA is expected to become a sizable headwind in the third and fourth quarters, resulting in negative earnings growth in the second half.

For full year TDAPA contributions, we now expect a lower year-over-year headwind of around EUR 50 million compared with the previously anticipated negative impact of around EUR 100 million. The second quarter demonstrates that the strategic actions we are taking are yielding meaningful improvements in underlying profitability and care delivery. Despite the headwinds from lower treatment volumes in the U.S. and a tougher base in the second half of the year, we expect continued improvement in the underlying profitability of care delivery.

Overall, we expect to deliver care enablement margin improvement in the second half and full year 2026 as we continue to execute our Reignite strategy, while offsetting increased inflationary pressure from the Middle East conflict in our care enablement business. And we continue to assume value-based care to perform around breakeven for the year, reflecting the assumed phasing of contributions and prior year effects.

Given our strong first half performance and current expectations for the remainder of the year, we are confirming our full year outlook. This concludes our prepared remarks, and I will now hand back to Dominik to begin the Q&A session.

Thank you, Helen. Thank you, Martin. Before I hand over for the Q&A, I would like to remind everyone to limit your questions to 2. If we have remaining time, we can go another round. With that, I hand it over to Valentina to open the Q&A, please.

[Operator Instructions] Back over to you for the first question.

Thank you, Valentina. And the first question comes from Jonathan from Barclays.

The first one is just on market treatment growth. If you could just help us to understand really the detail on the deceleration from Q1 to Q2 in that number, specifically on the referral piece. I'm really just trying to understand what you could do to improve the inflow of patients there? And how should we think about the relative impact to clinic closures, referrals, the outflow issues of patients that you'd previously pointed to?

And then thank you for giving the 2026 expectation. So is it fair to assume that you expect same market treatment growth in the U.S. to get worse throughout the year? How do you see the phasing? And where do you expect to exit 2027 from a say, market treatment growth perspective?

Thanks, Jonathan. I'll take that question and recognizing there's probably a lot of similar questions around same market treatment growth, I think it's helpful to kind of just maybe walk through that in a bit more detail than normal. As we already outlined, the same market treatment growth declined by 0.9% in the quarter. At the same time, we are encouraged by the progress we are seeing where it matters for our patients and that focus on quality and patient care is making a real difference, and we were really encouraged to see treatment and mortality declining in the quarter.

As we discussed in Q1, we are executing a lot in parallel in the U.S. dialysis business, which is an operational stretch. We obviously exited around 100 clinics with execution speed, I would say, in half 1, we've closed clinics faster than we would -- than we ever have before. Obviously, the progress on HDF is exciting. But at the same time, that does cause a fair amount of work in the clinics that we are impacting there. And at the same time, there has been a major clinic operations, we touched about kind of a couple of thousand people with the whole focus here on driving profitable growth. In the same time, recognizing that we had the ACA subsidies expiring, we also have implemented some enhanced insurance verification on our patients. And while we are pleased with the quality and patient safety initiatives, obviously rolling out these solutions did also have an impact on the operation.

So all of that is really to say the clinic operations of managing significant demand in parallel. And I think we saw that emerge on referrals in Q1 with a little softness there. And I would say that there was an underestimation of the impact that created. As we came out of Q1 into Q2, it was clear that there was -- while that disruption may have been understood, it was clear that it was masking an underlying issue. And I think what we -- as I've kind of worked kind of closely with the team there with Kathy directly, it's clear now that we have an operational miss specifically in the business development approach, which is capturing our fair market share of referrals.

We are not seeing a market issue. We are seeing a volume capture issue in terms of getting the patients that we see into our clinics. So that was the execution gap that has led to a further softening of referrals in Q2 compared to Q1. We are all over it. We've made some -- we obviously saw the organizational changes. We've also made organizational changes in the business development group. That will take a few months to gain traction. Kathy is crystal player of those priorities, and we do remain confident in our path to restoring those referral rates in those effective areas. And obviously, we're looking at this region by region.

However, given the compounding effect of the lower first half referrals on the rest of the year, that's why we are now saying we expect the same market treatment growth in '26 to be around the Q2 level. Obviously, that compounding effect has caused the gap. We also know that we've got to do work that will take time. So that's why I think we're trying to be realistic here and call the similar level to Q2. Obviously, we do expect that work to take hold and for that benefit to pull through. But realistically, I think we're seeing that move into '27 than were originally thinking in '26.

In terms of kind of the exit rate for 2027, clearly, I'm not going to speak to that today. I think we can kind of see where we see '26, what '27 looks like, I need a few more quarters under our belt. And obviously, we'll be able to give that outlook when we get to February. The kind of the areas of focus as you can appreciate, are making sure that when we get those referrals, they're accepted referrals, and we are gaining our fair share there. We had said, and I think it's fair to acknowledge this that we didn't have an inflow issue earlier or maybe the end of last year, it was an outflow issue.

I think we have done some significant work on outflows, and that's really showing up in the mortality and mistreatment numbers. What we have now is not a market or a patient issue, we have an accepted referral and inflow issue that is 1,000% the focus of and the organization. So I think that answered all the pieces there. And the apologies for the longer answer, I think it was one that's on a lot of people's minds.

The next question comes from Veronika from Citi.

I have 2 places apologies. The first 1 is going to be on the same market. And Helen, I just want to get a better shape of understanding of the quarter. I appreciate your don't report monthly. But I remember when you were on the road, you were talking about April being down 40 basis points. So not hugely similar, which would suggest that May and June really sort of fell off the cliff in terms of USA market treatment growth rate. was kind of wondering if you could comment on that.

And I guess if you have any early indications for how the referral piece is improving in July relative to how -- or it must have been in May and June, that might be helpful to give us a little bit of a confidence in terms of the forward path?

And then my second question is on the TDAPA binder assumption for the year. By my math, you're probably at around 130 already for H1. It sounds like the new guidance is 150 to 170, just trying to understand if maybe you're being a little too conservative on that, given how strong the first half of the year has come in?

Yes. Thanks, Veronika. I'll take the same market treatment growth, and I'll have Martin walk us through the TDAPA numbers because I know there's a lot of numbers here on that one. Yes, look, you're right. When we were on the road in April, we were already indicating that April may be kind of a similar level coming out of the softness of Q1. I mean don't forget, April still had the benefit of the lower flu base in 2025. So that was kind of maybe also not giving us the clear picture.

There's no question, as you see the number for the quarter that May and June did deteriorate, and I think that's where the focus has been over the last couple of months is really getting under what the root cause is and where the area of focus was. I mean I can buy disruption to our point, but we also have to make sure that the underlying in cooperation is operating as we expect it to. And I'm the last person here want to speak to an operational miss, but clearly, we have one here, and that's why I think we're just being careful on how we guide the rest of the year. In July, I haven't seen numbers yet. But I think the fact that we are thinking calling it for a similar level to Q2, I don't expect to see the improvement overnight, but I do expect to see it take hold as we go through the next couple of quarters here. Martin, do you want to take TDAPA?

Yes. Veronika, so on TDAPA, as we said, we have seen about EUR 80 million effect in quarter 2, and also, we said that we expect after the first past tailwinds is to turn into a headwind for quarter 3 and quarter 4. Now total TDAPA contribution, we are now saying will be a negative EUR 50 million overall on a year-over-year basis, and that is reduced from around EUR 100 million we had on the previous expectations.

As a reminder, we had last year a EUR 310 million positive year-over-year contribution. And we said there was a EUR 90 million. Is unchanged, positive EUR 90 million first half, negative EUR 90 million in the second half. So year-over-year, that is a wash or a 0 effect. For the binders, yes, we did see in the first half around the EUR 70 million positivity year-over-year. And we expect this to turn into a headwind of around EUR 120 million year-over-year in the second half, then resulting in the EUR 50 million for the full year. The lower headwinds is predominantly driven by our Pharma business, where we see lower-than-expected headwinds, and that gives us -- or gives you an impression on the overall picture.

That's helpful. And Helen, can I just follow up. One of the things that really struggled this quarter is the volume growth at wars in the U.S. Clinics business, but it looks like your revenue mix is good, your revenue management is good. Is there a risk here about your sort of so focused on profitability that you've ended up at a place where volume growth is suffering. Is that the issue that we're looking at?

No, I don't believe so. The work that we identified on rate and yield were very obvious things for us to go after, where we were lagging, and we've made tremendous strides in those. And in many ways, there are different teams internally within CB as well focused on those. We will look at profitability measures like the clinic closures where we really can't see a way to make that clinic profitable. That obviously has been a profitability focus for us, but not at the -- not at the detriment of the weight and the yield that you're talking about. But we clearly knew right, that when we were closing these clinics, while we've held on a significant portion of these patients, we knew we were giving up some of that volume, and we saw that play out in the market in Q1. Expect that to continue to play out in the market in Q2.

I think the -- that was kind of a smaller piece of the overall same market treatment growth development, though. But we're very mindful, Veronika, of what trade-offs we are making, and we don't go into any of them likely, but clearly, the profitability play on both the restructuring reorg and the clinic closures has been meaningful for us. And a smaller part of that same market treatment growth give up. The real issue here is we're really focused to the business development area on accepted referrals. And we can see that by area. So it is isolated, which is why I'm kind of confident that we've got the right plans in place. We've got the right people now in place, and we can get at it.

The next question comes from Oliver from ODDO BHF. Oliver, the floor to yours.

Two questions from my side. First, about the ARR commercial mix. So would you describe that you started initiatives to improve the mix since last fall have contributed already significantly to some of these mix improvements.

Second question is still very early days, but we saw recently, the first indications about the bundled rate which also caused some volatility in the share price. Could you share with us how you think about what the first indications? And yes, change, but it would be great to hear you.

Yes. Thanks, Oliver. I think I can tackle both of those. On the commercial mix, we continue to be very encouraged by the improvements that we see there. The weight improvement is real. We've done a lot of work in that area. It is slightly down to ACA that obviously has developed in line with our expectations. But overall, really pleased with the work that has been done on the commercial mix.

On the bundle rate, the 1% always disappointing. Clearly, we're in preliminary period were offering up a lot of comments to the administration on the moving pieces of that. We'll see what final brings. But overall, it's always challenging when it's less than inflation.

I was less about the bundle rates, but more about also the additions which come to the total rate.

Oh, you mean the TDAPA add-on payment?

Yes. Yes. Okay.

Yes, sorry. I heard you say bundle and I thought you were talking about the PPS rate that also came out since last quarter.

No, no, no. I meant also including TDAPA, sorry.

Yes. Look, 2 things there. Again, some of this is preliminary. We do expect the government to continue to capture the pricing for the next couple of quarters before it comes final. So for that, we would expect that payment to come down as it brings in more quarters, reflecting the lower prices and the rebates that exist in that. So that should come down as we get to final. And I think what we would see, we wouldn't be surprised that, that continues to develop in line with our expectations. It's high right now just because it's -- I think it's a 2-quarter lag off to what more data would come in and show.

The next question comes from Aisyah from Morgan Stanley.

My first one is also, unfortunately, on the same market treatment growth for the international number. That number was quite weak and the weakest we've seen in 2 years. Were there any reimbursements there in the past that supports the growth and has resulted in a lower number in the quarter?

And then my second question was on the ACA headwind that you expect, I guess, what was the number for the quarter, your expectations for 2026? And any early thoughts on the ACA headwind for 2027?

Thanks, Aisyah. On the international same market treatment growth, clearly, we have a lot -- there's a mix effect there. Clearly, we have a lot of countries and a lot of markets that we are focusing on. I think the piece that kind of maybe gets lost in this is we have exited some markets that had higher growth rates, so that would have an effect, and it's kind of a little bit of mix on the mix in the countries like Brazil and Malaysia, for example. And then as we already mentioned, the kind of the flu impact in Q2 as well. So nothing that we are overly concerned about their.

On the ACA, we had kind of sized a EUR 50 million headwind for the full year. We had been watching that very, very closely, obviously, in Q1 to see how sticky this was. And what would happen once patients have to start paying their premiums. It did step up as expected in Q2, which has meant that we've seen existing patients leave the exchange plans due to the affordability issues. And then we have seen some patients move to other coverage like Medicare Advantage or Medicare. And of course, some are no longer treating with us. So the underlying headwind remains consistent with our initial expectation of that EUR 50 million for the full year.

What we're also seeing is that we have been able to reduce the impact on our commercial mix by expanded payer relationships and signing new contracts in other geographies. So while it starts to get really difficult to tease out what patient went where, we can see what happened on the ACA exchanges, but anything else that results from that will be picked up in business growth moving forward. So we won't continue to track this ACA move. I think we've kind of been able to ring fence it for 2026, but all kind of played out as expected, even though there was this we had dynamic between Q1 and Q2 were back where we thought we would be.

So if I kind of interpret your comments and assuming that this impact kind of increases over the course of the year towards the EUR 50 million you had expected for the full year. Would it be fair to assume it's something like EUR 10 million this quarter, EUR 50 million next quarter, EUR 25 million in the quarter after that? Or is it more kind of a linear progression?

Probably neither. It's been a bit lumpy because of what happened in Q1 and then some of this grace period and then kind of how patients have fallen out. So I think we're not kind of getting into the quarter-by-quarter, but just like the whole EUR 50 million sizing for the year, but line with our half 1, half 2 phasing within our guidance range.

The next question comes from Hugo from BNPP.

I have 2, please. First quick one on tariff. Can you maybe help us the impact in Q2, what you expect for the remainder of the year? I think you guys have only a marginal impact, but would be helpful to have that number.

Second, thanks for all the moving parts on 2026. But if we look forward to 2027, you guys have some tailwinds rolling off. U.S. drop to is 1% and inflation keeps trending slightly above that at 3%. Could you walk us through some of the building blocks for 2027, which would lead to EBIT growth next year if that is the plan? Or is EBIT growth of the next year?

Yes, why don't you take the tariff question and I will head up the tailwinds and headwinds discussions for 2027.

As we have discussed, we had a limited tariff exposure in the past because of the breadth of our supply chain network and how we manage to mitigate it. As such, we also expect a limited refund. We have not received or booked anything in the second quarter. We expect let's say, high single-digit kind of range in the second half year. But it is, as I said, previously on the headwinds rather limited.

Yes. Hugo, I think you can appreciate. I am not going to get into the moving pieces of 2027 guidance in August of '26 million. What I will speak to, though, is you know our usual building blocks, right? On the positive side, business performance and volume with a '25, clear expectation there that we continue to expand our margins across the business. as well as getting the benefits from the HDF rollout. On the negative side, of course, we have the usual inflation and merit increases. And then I think the bigger moving bucket for 2027 is the binders and the TDAPA roll off and that headwind into 2027. Obviously, we are not able to completely side that and won't do that today. But obviously, we've got to wait for what the final pricing does on kind of the pricing of what goes into the bundle. But I think there's -- I think we've got our arms around what the moving parts of this business are by now. And of course, we'll size them accordingly by February.

The next question comes from Richard from Goldman Sachs.

I just want to follow up on the U.S. treatment growth, and in particular, your comments about not capturing your fair share of referrals. What was actually sort of I guess, in practice, what was happening to drive that? Have there been changes in your processes, your competitor processes? I guess I'd like to understand more what the sort of the root cause of that is?

And then sort of as a follow-up to that, what is going to be top of cases to do list as she sort of comes in to run that business? And I suppose, tries to steady the ship.

Yes. Thanks, Richard. Look, at the end of the day, we could see that we were getting patients referred and we weren't we weren't getting them into the clinic. So we track incoming referrals, and we also track confirmed referrals. So when those referrals don't get confirmed, meaning a patient isn't in the chair, we know that they're going somewhere else. So we're clearly expecting share loss because those patients have gone somewhere, and we'll see how that plays out in the market this quarter, of course.

What we are able to see is what those volumes and what those shares kind of volumes look like by region. And clearly, where we were falling short there, we have now targeted what area we need to make those improvements. So there is clear visibility on it. There has been leadership changes in that area as well. And I think our whole organization knows that every aspect of inflows and outflows on same market treatment growth are our #1 priority.

What I am encouraged by been with the organization about 3 quarters or so now. She's clearly, as we were looking through the noise of disruption, and I was trying to get under the cause, she quickly identified that we had a business development and kind of in our own control inflow issue, if you will, when she's already working through those measures that need to be executed in. And as I mentioned, we're kind of putting the right leaders in and the right metrics to make sure that we're really focused on this particular root cause.

As we know. I mean, it's a big operation. It's a complex operation. We've done a lot here, and I don't want to dismiss the work that has been done. And I think the work that we are pulling through on outflows speaks to that. So we're focused on it. And I think Kathy and I are very clearly aligned on the priorities on where we need to see improvement, and we'll obviously track it accordingly daily and weekly monthly.

I appreciate the color. And if I could just squeeze in 1 follow-up. International Care delivery was pretty robust, especially in organic terms. What was driving that? Are there any one-offs that we should be aware of?

Martin, do you want to take that?

Yes, you saw that the same market treatment growth was at the 0.8. We did see in the international organic revenue driver, a supporting accounting topic, which had an effect there. When you look at that in the second quarter, we had certain pharmaceutical product business activities that we still had in care enablement. And in the second quarter, we shifted that to it's neutral for the overall company to give you a bit of a, let's say, framing here, this is something that had last year quarter 2 about EUR 20 million roughly in revenue and a low single digit in profitability. That is what is supporting international organic revenue growth. And we did that in order to also have a full visibility of the Global Pharma P&L.

Next question comes from Anna from Bank of America.

I wanted to dig in a bit on the HV HDF rollout and how much, if at all, you saw disruption from the rollout of the clinics affecting USA market treatment growth in the quarter and what the learnings are from the rollout in the first half to take into the second half? And then I also wanted to, if possible, ask about external sales of HV HDF. I realize that's not a near-term priority. The priority for the year is the internal rollout, but I imagine those discussions are in place, just -- how are they evolving? And how has that maybe changed after the mother trial data? Any incremental color there would be super helpful.

Yes. Thanks, Anna. As you know, it's my favorite topic and one that we are thrilled with the progress on. And as you can appreciate, something of this scale, we get a lot of learnings. What I would say is a lot of those learnings were really, really helpful through that pilot stage of last year. Once we got going, I think the teams have really stepped up. Don't forget, it's still a relatively small part of the overall clinic network that has been converted, so it's not that it's a mass disruption to the 2,600 clinic network. It is obviously an impact the couple of hundred that we have done so far.

What we have seen is, as we are gathering momentum, the speed and training and staff just getting it, and that's why I think you're seeing the acceleration and the kind of the progress of the 10%, which is wonderful. I'd say we were clear that we wanted to track this patient cohort that was on HDF, and put out the BEACON-US press release last week, which we're thrilled with. I think it's too early at this stage to give real mortality or mistreatment data on that cohort, but what we are able to see and I referenced it earlier, is that the clinical benefits are tracking in line with the CONVINCE study and the fact that we've got the patients reaching the high volume relatively quickly, we know that, that mortality benefit will ramp up over the coming years as well.

So we're thrilled with what we're seeing so far as well as obviously not just the performance, but the patient feedback, the physician feedback and obviously, the kind of patients reaching out to learn more and want to be referred to a HDF clinic. As you rightly said that the external sales minimum this year because of the allocation plan to our clinics.

So obviously, where making our machines available as we have excess capacity to other providers, but that is something that is in pilot with some of those right now. And obviously, that's up to after them on what they choose to do with purchasing the machines. Obviously, that excess capacity that we've allocated doesn't get taken up in the short term, that would mean we would allocate more to our clinics and go faster. So I think we're in good shape where we are 6 months or 2 quarters into, I guess, were 8 months, but 2 quarters in at least to the launch and things are going incredibly well. And I think the speed of uptake on the -- reaching the high volume levels is incredibly exciting, and we're seeing that show up in the patient response.

The next question comes from Graham from UBS.

Just 1 quick 1 for Martin and then a slightly longer 1 for Helen. Mark, just on TDAPA, just I've had a few people ask this specific total contribution for Q2. So is it fair to think of that as about EUR 120 million of EBIT in Q2 was from the full TDAPA, so catheters and phosphates. And then, Helen, just secondly, on the guidance for this year. So the midpoint would imply something like a 12%, 13% decline in EBIT in H2. And when I think of H2 of '26, H1 '27 looks quite similar in terms of the TDAPA driver in terms of the comparator there. that feels like not an sensible way of think about H1 '27 and there's still a degree of headwind in H2 '27.

Is it still reasonable to think of EBIT growth in 2027? I know you don't want to comment too much on it, but -- it's just it seems like those headwinds are quite big.

Martin, do you want to take the TDAPA one?

Yes. Graham, so what we did disclose is that this quarter in 2026, we had a year-over-year improvement of EUR 80 million. We also disclosed in quarter 2, 2025 that we had against the prior year period before TDAPA, an improvement year-over-year of the lower end of a mid-double-digit impact -- so when you take these 2 together, you are roughly where you said you would be and that constitutes kind of a 2x year-over-year improvement that we see. We think of it in the yearly slice normally not as a total contribution. Does that make sense?

That's super. That's super clear.

Yes. And then, Graham, on your second question, obviously, I don't want to get into the 2027 guidance, but I recognize everyone is already trying to put those building blocks together. Maybe what I would refer you to is the 25 to 28 CAGR aspiration that we put out there. Obviously, on '26, we are confirming our guidance -- we always said that there would be this shift between half 1 and half 2 that has completely developed in line with our expectations, which is why we are confirming. And then, of course, we've put out a 25% to 28.3% growth CAGR aspiration, and that is obviously still there. That use 2025 as a base that had the roughly $300 million of TDAPA benefits in there. So yes, that's how we're thinking about it. And don't forget, on that 3% to 7% CAGR growth assumption, we had also said there was underlying low teens growth, so obviously, we are expecting the businesses to continue to contribute on the margin expansion here.

The next question comes from James from Jefferies..

Two, if I can, please. Firstly, you've completed 100 clinic closures this year. So I was wondering if volumes stayed around the 2Q level into next year, would you need to consider other clinic closure programs to manage your fixed costs, or how should we think about decisions to manage your clinic capacity?

And then the second question is, this quarter, you've renamed the operating cash flow line changes in other working capital and noncash items to changes in other assets and liabilities and other noncash items. So I was wondering why you changed the wording now. And was this purely presentational? Or does it better reflect the fact that a broader set of operating assets and liabilities now contribute to operating cash flow than historically? It does seem if cash flow improvements from this line in the first half were greater than the whole of the group. So it would be helpful to have some color on what's driven it it's outside core operations, which otherwise would have decreased.

James, the clinic closure question sounds a lot easier than the second one. So I'll take the first one. Martin can clearly give him a moment to look that up while I'm answering the clinic closures. Look, what we've -- this is the second round of clinic closures that we've done over the last couple of years. As we know, the deeper you go into that program on where they are operationally the tougher they get in terms the kind of the ROI on them. We feel really good about what we've done to date and this EUR 100 million.

We feel that we're well placed with our outlook on what we expect to get on volume and obviously, the benefits from HDF as they kick in. I've always said, while we're not planning for this not to kind of come back to growth, I've always said, costs are not fixed indefinitely, and we would adjust capacity and overhead accordingly. And I think we've been very diligent in how we've done that and appropriate with the kind of the outlook that we've got.

So I our expectation is still this underlying return to growth. Clearly, it's now taking up a little longer, but we will -- we're constantly looking at that overhead structure in line with that and would adjust if needed in the future.

Okay. So would it be fair to say if it was more like, say, minus 1.5 or something like that would kind of probably sort of trigger that sort of discussion. I guess I was sort of trying to understand the capacity that you have in terms of this management how much excess there is for you to do that. So how much headroom do you have at the current run rate maybe is a better way of asking the question.

Yes. I feel that we are rightsized for what we expect to see through this medium-term period.

Okay. So James, from my side. So there is no change in content, so to say, in the line. There's also no accounting changes that impact the line. It is only a better representation of the naming of the line.

So that's sort of understood. But in terms of what's driven that then, just given the swing is more than the cash flow from generating the overall group. Are you able to give us a sense what's gone into that cash flow improvement?

So overall, our cash flow improvement was driven by the working capital development that we had, as Helen pointed out, where we did improve so to say, based on the collection side as well as on the receivable side with a strong cash velocity. And we also improved further as we also had lined out already in quarter 1 on the payable side. So those were the main drivers on the capital.

I think it's just because of the wording, it now doesn't include working capital in that particular line. That's sort of what I'm just trying to understand. I'm happy to follow up off-line if that's easier. But given the magnitude just it would be helpful to understand.

So no content change. And the main drivers are the.

The next call comes from Falko from Deutsche Bank.

My first question is on the care enablement business in China. Thanks for pointing out the headwind in Q2. And I was wondering when you expect this situation to stabilize.

And secondly, on the ACA topic, do you happen to have any early view on how we should think about this for 2027? And how much of an additional headwind it could potentially be next year on top of the EUR 50 million this year?

Yes, Falko. Martin, why don't you take the China question. I'll come back on the ACA topic.

All right. Sorry for that. There was a bit of . So in China, we did see first half expectations to be as we thought. We had EUR 20 million headwind in the quarter 2. We had in the quarter 1 half of the expected less than EUR 50 million. So for the second half, we see that to be normalized, and we expect for the full year also this to remain below the EUR 50 million. I would say, through the first half, we are through the most of it. And with that EUR 50 million assumption for the full year still intact.

Yes. And then Falko, on your ACA question, clearly, I'm not going to size what that is for 2027 because we don't really know. What we do know is the EUR 50 million that developed unfavorably this year was in line with expectations. But as I also mentioned in my answer to my previous question on the same topic, that we also are seeing shifts in kind of contracts and where patients are going. So I think ultimately, what this will all wash up in is our business kind of business growth number, and that will kind of now be in the base. But it's -- there's moving pieces here, so not all not all negative because of the positive moves in cap rates with different insurers. So it's just going to be impossible to partly moving forward.

So when we give a business growth number for 2027, once we roll up these entire books of business and that we all settles out, we'll be able to kind of put in there so that we -- it's impossible to track where these patients ultimately will end up in 2027 between the different plans. But we'll do the bottom-up book of business build that goes into that business growth number.

Thank you. So those were all questions we received. So there is no one waiting to ask a question. With that, I'll thank Helen and Martin for answering the questions and for all the interesting questions. And with that, we'll close the call and wish everyone a great summer.

Yes. Thanks, everybody. Appreciate the flexibility today on the earlier timing as well. Have a good summer, and we'll see many of you on the road soon. Thank you.

Thank you.

Ladies and gentlemen, the conference is now over. Thank you for choosing Chorus Call, and thank you for participating in the conference. You may now disconnect your lines. Goodbye.

Ladies and gentlemen, welcome to the report on First Quarter 2026 Earnings Conference Call. I am Valentina, the Chorus Call operator. [Operator Instructions] The conference is being recorded. [Operator Instructions]. The conference must not be recorded for publication or broadcast.

At this time, it's my pleasure to hand over to Dr. Dominik Heger. Please go ahead.

Thank you, Valentina. I would like to welcome everyone to our earnings call for the first quarter 2026. As always, I start out the call by mentioning our cautionary language that is in our safe harbor statement as well as in our presentation and in all the materials that we have distributed earlier today.

For further details concerning risks and uncertainties, please refer to these documents and to our SEC filings. We will have a little bit under an hour for the call. In order to give everyone the chance to ask questions, we would limit the number of questions to 2. Thank you for making this work, as always.

Let me now welcome Helen Giza, CEO and Chair of the Management Board; and Martin Fischer, our Chief Financial Officer. Helen, the floor is yours.

Thank you, Dominik. I'd like to extend a warm welcome to everyone on the call. Thank you for your continued interest in Fresenius Medical Care. I will begin my prepared remarks on Slide 4. I am pleased to report that we began 2026 with continued operational and financial progress. We realized the solid organic revenue growth of 4%, reflecting positive contributions from all segments. We achieved strong operating income growth of 10%, in line with our planned phasing for the year and leading to further margin expansion. This was supported by continued execution of our FME25+ saving program, which delivered EUR 50 million in sustainable savings in the quarter.

On 30th of April, we successfully completed our initial share buyback program of EUR 1 billion in a significantly accelerated way. It was done in less than 1 year instead of within 2 years as originally announced. We bought back 24.8 million shares or 8.5% of share capital. At the same time, our net leverage ratio of 2.6x remains around the lower end of our target corridor.

Let me now turn to key first quarter highlights across our operating segments on Slide 5. Beginning with Care Delivery in the U.S., same market treatment growth declined by 37 basis points as volumes were impacted by missed treatments. We had flagged during the quarter that we experienced severe U.S. weather events in January and February. As we focus on core operational improvements with clinic closures and insurance verification, this likely had a small impact on patient inflows at the start of the year. This was further complicated by the unclear situation for many patients with their insurance coverage due to the expiry of the extended tax subsidies for ACA.

Volumes also continue to face pressure from mortality remaining above prepandemic levels. We are maintaining our assumption of flat U.S.A. market treatment growth in 2026, which includes the expectation for improving volumes over the course of the year. Our Care Delivery International markets delivered 1.3% same market treatment growth. Whilst TDAPA provided a benefit to our care delivery performance, Martin will address that in his remarks. What really stands out to me is the successful execution of our FME reignite strategy and the actions we are taking to strengthen our Care Delivery business while driving profitable growth.

We understand the sense of urgency as well as the pace and momentum needed to deliver growth in our underlying business, and there are several proof points demonstrating progress already. While mortality levels are still above prepandemic level, we have seen a reduction in catheter-related bloodstream infections, with now around 90% of all eligible patients using an antimicrobial catheter lock solution. This is part of our FME reignite strategic priority to increase patient quality and safety.

We expect the progress we have made on increased usage of catheter lock solutions to begin to have a positive impact on miss treatments and mortality in the near future. The 5008X rollout and introduction of HighVolumeHDF therapy represents the biggest operational and clinical change in our company's history.

With the start of the large-scale launch in January, we have achieved a clear step-up change in rollout speed and are well on track. We surpassed 100,000 treatments on the 5008x in the first week of April and around 100 clinics have been converted to the new care system with more conversions underway as we speak.

In February, as part of FME25+, we announced the biggest U.S. clinical restructuring in recent history with plans to close up to 100 clinics. Here, we are also moving at speed with 64 clinics already exited in the first quarter and the remainder expected within Q2.

And finally, we have realized improvements in revenue cycle management, providing further evidence of our strategic execution.

Turning to value-based care. We delivered positive operating income driven by favorable savings rate, and we realized an increase in member months from future contracting growth.

Leveraging data and analytics to improve quality and coordination of care is a central component of our FME reignite strategy. We have expanded adoption of AI-driven interventions for imminent hospital admissions of ESRD patients. Where employed, these programs have shown a reduction in hospitalizations by as much as 15% and missed dialysis treatments per member per month by up to 26% for the highest risk patients. We will continue to scale this across our VBC population.

I'm also proud to report that we continue to be recognized for quality leadership in the United States Government CKCC program for multiple consecutive years. We delivered over $270 million in shared savings and achieved an 88% average quality score over the first 3 years of the program. In the most recent publicly available data, we earned over 40% of the program's high performer pool driven by our industry-leading quality.

Care Enablement realized favorable business growth as sales of the 5008x in the U.S. ramp up. This is a tremendous opportunity to bring new innovation to the U.S. market and we are on track with production to supply both machines and consumables according to our targets for the year.

In the first quarter, we achieved positive pricing and volume development in our markets outside of China. We faced continued pressure in China, especially from volume-based procurement and stricter tender requirements. We continue to closely monitor developments in China and assess the implications on our product portfolio and strategy as part of FME reignite. We also continue to strengthen our core care enablement business with further FME25+ progress in streamlining our manufacturing and supply chain.

I will now hand over to Martin to walk you through the first quarter financials in more detail.

Thank you, Helen, and welcome to everyone on the call also from my side. I will pick up on Slide 7. In the first quarter, we achieved solid organic revenue growth of 4%, supported by growth in all 3 operating segments. At constant currency, revenue increased by 3%. Care Enablement revenue development continues to face headwinds from regulatory pressure in China.

Divestitures negatively impacted revenue development by 50 basis points. We delivered strong operating income growth of 10% at constant currency. This increase was supported by contributions from all operating segments and is in line with our expected phasing for our '26 outlook. Special items in the first quarter amounted to a net negative EUR 181 million, mainly reflecting costs associated with FME25+ as we accelerated our U.S. clinic closures.

In line with expectations, FME25+ costs are planned to come down over the course of the year as costs related to U.S. clinic closures are first half loaded. Turning to Slide 8. This chart illustrates the year-over-year improvement of the group operating income margin, highlighting a further increase of 70 basis points. With 10.1%, this is a solid start toward achieving our projected group operating income margin of 10.5% to 12% for the full year. Care Delivery was the main driver of improved profitability with a small contribution from value-based care. The higher intersegment elimination reflects the 5008X CAREsystem sales in the United States.

Corporate costs increased by EUR 37 million. This was mainly driven by the planned cost of strategic IT platform investments, including preparation for the transition to SAP S/4HANA. FX translation effects were unfavorable this quarter and stood at negative EUR 34 million. The average U.S. dollar exchange rate in the first quarter was $1.17 compared to $1.16 in the fourth quarter and compared to $1.05 in the first quarter of 2025.

I will now walk you briefly through the business development in each segment, starting with Care Delivery on Slide 9. Care Delivery achieved organic revenue growth of 6%, driven by both Care Delivery U.S. despite muted U.S. volumes and Care Delivery International. At constant currency, revenue increased by 5%. In the U.S., growth was driven by a positive impact from the TDAPA reimbursement regulations as well as favorable rate and payer mix effects.

Our U.S. payer mix remained strong in the quarter with relatively low attrition in the exchange patient population. We expect that attrition to increase over the course of 2026 as rate periods expire and affordability pressures grow around higher premium and out-of-pocket costs. We continue to expect an impact of around EUR 50 million for full year 2026. The impact from divestitures as part of our portfolio optimization plan reduced revenue growth by about 80 basis points.

The main driver here was the prior year divestment of our clinics in Brazil. Care Delivery realized strong operating income growth of 26%. This resulted in a margin improvement to 12.1%. Benefits from TDAPA reimbursement regulation for phosphate binders and catheter lock solutions were, as expected, a meaningful driver of the earnings development. We continue to assume a significant headwind from TDAPA reimbursement regulation in the second half of the year.

Importantly, excluding TDAPA benefit, the underlying business realized around 6% earnings growth on a constant currency basis. This includes favorable rate and mix effects, lower implicit price concession, thanks to our revenue cycle management initiatives and partially offset planned strategic investments for the 5008X rollout in our U.S. clinics. Savings from the FME25+ program contributed positively. The anticipated labor cost increase as well as currency translation effects had a negative impact in the development.

Turning to Value-Based Care on Slide 10. Value-Based Care realized 3% revenue growth on both an organic and constant currency basis. This was driven by a higher number of member months from contract expansion and positive effects from premium rates. Prior period contract true-ups also created positive growth in the first quarter. This was partially offset by the change of risk type for a large contract resulting in a different accounting treatment and lower revenue recognition.

We expect revenue growth will turn negative throughout the year, primarily due to the change in accounting treatment. Operating income for Value-Based Care increased significantly in relative terms and the margin was enhanced by 100 basis points. Value-Based Care was profitable for the second consecutive quarter. The increase in business growth was mainly driven by an enhanced savings rate. FME25+ program-related savings resulted from the reorganization of the team to take advantage of integration with Fresenius Medical Care and becoming more efficient while aligning staffing with our strategic priorities. Higher inflation and currency translation effects were offsetting factors.

I will turn to Care Enablement on Slide 11. Revenue in Care Enablement increased by 1% on an organic and constant currency basis. Organic revenue development reflects continued positive volumes and pricing, excluding adverse regulatory impacts in China, which include volume-based procurement and switcher tender requirements. Revenue was also supported by strong sales of the 5008X CAREsystems in the United States.

Care Enablement earnings slightly increased on a constant currency basis, leading to a 40 basis point margin improvement. Business growth was impacted by adverse regulatory impacts in China and negative currency translation effects. Positive volume and price effect outside of China contributed positively to business growth. Additional, FME25+ savings from continued progress in manufacturing and supply chain initiatives supported margin expansion. Inflationary costs increased and had a negative effect.

Next, I will look at the cash flow growth on Slide 12. As always in the first quarter, we have a seasonality effect in invoicing, which is why the quarter typically represents a relatively low share of the full year operating cash flow. This year, while on the typically lower quarter 1 level, we realized a strong increase in operating cash flow by 39%. The main driver was favorable working capital management. Free cash flow increased by 94% to EUR 40 million. Total debt and lease liabilities as well as total net debt and lease liabilities were broadly stable compared to the prior year period.

As part of our share buyback program, we repurchased a total of 23.3 million shares for EUR 941 million by the end of the first quarter. This represents 7.9% of share capital. On April 30, we successfully completed our initial share buyback program of EUR 1 billion. We bought back in an accelerated way, 24.8 million shares or 8.5% of share capital. With 2.6x, our net leverage ratio continued to be around the lower end of our self-imposed target corridor of 2.5 to 3x. I will now hand back to Helen.

Thanks, Martin. I will pick up with the outlook slide on Slide 14. Given our strong first quarter performance and current expectations for the remainder of 2026, we are confirming our full year outlook. We continue to expect a broadly flat revenue development.

For earnings, we assume operating income will remain on a consistently high level as 2025 with an upside downside range of a mid-single-digit percentage change. We clearly target to maintain our enhanced profitability. Unchanged to our assumptions, we do expect a positive earnings growth in the first half of 2026.

Due to the phasing of the regulatory TDAPA effects, which should present a significant headwind in the second half of the year, we assume a negative earnings growth in the back half of 2026. As you will be asking about the impacts from the Middle East crisis, I want to say that we are closely monitoring inflationary impacts from higher oil prices, raw material costs and other supply chain and transportation cost-related topics. So far, there were no meaningful interruptions of our local operations during the first quarter and the financial impacts are currently absorbed within our range of inflation assumptions for our 2026 outlook.

We are closely monitoring this, have implemented mitigation measures, and we'll keep you updated. This concludes my prepared remarks, and I now hand back to Dominik to begin the Q&A session.

Thank you, Helen. Thank you, Martin. Before I hand over for the Q&A, as always, I would like to remind you please start with 2 questions only and if you have time left, we'll go a second round. And with that, I hand it over to Valentina to open the Q&A, please.

[Operator Instructions] Back over to you, Dominik, for the first question.

The first question comes from Graham from UBS.

Obviously, congratulations on the 5008X rollout, that's obviously an update and big undertaking. I was hoping you might be able to contextualize that and some of the other growth drivers that you expect to build through the year. It's just when I look at the underlying growth for Q1, if you adjust the TDAPA, it looks like there's quite a bit of work to do as we go through the year when we think of the kind of mid-teens implied growth in consensus for 2027.

So I sort of just thinking how do you get there? How you get to that sort of mid-teens growth for next year when you exit that TDAPA piece? So is it more cost savings? Is there another TDAPA coming? Presumably the volume uplift won't start just yet from HVHDF. But if we could get a sense as to which of those drivers are making you confident on that?

Thanks, Graham. I'll take that. Obviously, we outlined a lot of the drivers for reignite and how we get to those mid-teens margins. Kind of the specific building blocks clearly are ongoing FME25, as you rightly said. The 5008X obviously, is expected to ramp up, not just over this year, but over those next couple of years as well.

The work that we are doing and have constantly spoke to about improving inflows and outflows is quite multifactorial there. We're obviously working on improving our internal processes and even the work that we are doing on the catheter lock solutions in improving patient safety, patient quality will have a positive effect as will HDF on treatment volumes, reduced hospitalizations, reduced missed treatments and, of course, longer mortality or improved mortality, I should say. As we think about the rev cycle management, we've got some nice contribution coming in for that. That will continue to ramp up over the course of the year.

And then as you can appreciate, the clinic closures, which is a big part of the onetime cost in Q1, we'll start to get those savings continuing to compound over the course of the year. So a lot of building blocks there, not new building blocks, but ones that we're continuing to work through. I think the other piece, as we go then specific and maybe most of those are specific to Care Delivery. As we think about Care Enablement, obviously, there's FME25 there. And I think the China piece, and I'm sure there'll be questions on that, we've sized that for the year, knew that we'd have a bigger impact in Q1. That should also be behind us or kind of the full number more heavy loaded in the first half.

And then that ongoing work on good contracting, pricing, reimbursement and volume. So I'm confident in the plans. We've really underscored and underpinned the initiatives across all 3 segments, and we're executing against that to crystal clear on the aspiration to be at mid-teens margins for all segment. I shouldn't say all segments in [ VBC ]. Time will tell me, but that Care Delivery and Care Enablement. And I think that's why it's important we understand the TDAPA piece. We understand the cliff that will happen. We are really focused on that underlying improvement and personally really encouraged by that 6% underlying improvement in Care Delivery in the quarter. So recognize a lot of moving parts, a lot of good initiatives, and I think we're really starting to see them come through, but the clear building blocks of how we get there.

Also maybe just a quick follow-up on DefenCath, are you guys seeing the benefits fairly quickly? It seems like something you might see a little bit of a tailwind relatively quickly.

For which Graham, did you say HDF?

For DefenCath. So for the [Technical Difficulty] products..

Yes, for sure. With having more than 90% of our patients on that, we are really starting to see a real improvement and reduction in bloodstream-related infections. So really encouraged by that work. Of course, we know with the DefenCath, should know that's a TDAPA period, but the underlying catheter lock solution really good for the patient safety, patient quality. So outside the financial impact of that, clear improvement that should be expected to translate into reduced hospitalizations and reduced missed treatments with the patients over time.

The next question comes from Hassan from Barclays.

Firstly, on the TDAPA benefit in the quarter, can you talk to the split of the EUR 80 million, be it phosphate binders versus catheter lock in the quarter and how you see Q2 and H2? And if this is consistent with the expectations that you set out in February? And then secondly, on same market treatment growth, if you could help unpack some of the underlying dynamics and if possible, how much of the headwind you think you may have seen from weather in Q1?

And with no second flu spike, do you expect growth to swing quite meaningfully in the second quarter, all else equal? And perhaps into positive territory? Or is there something else in Q1 that should constrain that improvement that you might be seeing, be it inflow or mortality?

Thanks, Hassan. Martin, do you want to unpack the financials on TDAPA? I suspect many have the same questions. So why don't you walk through that, and I'll take the same market treatment growth question.

Got it. So the contribution of TDAPA for the first half -- for the first quarter, as you said, Hassan, was about EUR 80 million on a constant currency basis. We have also told you and shared with you that the catheter lock solution contribution from '25 to '26 would be in equal size, meaning EUR 90 million for the first half year. And we saw about half of that come through in the first quarter as well. And the remainder between that and the EUR 80 million is a binder contribution.

Overall, our TDAPA contribution has developed as expected. And we have, as a reminder, positive contributions for the first half of 2026, and we expect negative headwinds in the second half. And that's why we also have -- when we talk about operating income improvement for the first half, a positive growth and for the second half, a negative growth expectation year-over-year.

Thanks, Martin. And I'll take the same market treatment growth because I expect people have a similar question here, too. Look, it's -- we all know we're in small numbers on small numbers here. We know that we had weather in January and February that did result in missed treatments. Flu was similar in Q1 '26 to what it was in Q1 '25. We are kind of unpacking. We did see slightly lower referrals in the first part of the year. And obviously, we know we've got a lot of clinic closures and restructuring underway.

We also know that the ACA piece did cause a lot of uncertainty on patients, and we're also refining our own patient insurance verification processes. So look, our guide is unchanged. We do still expect to be flat full year -- not -- I haven't even seen April numbers yet, so not in a position clearly to give insights into Q2. We do expect to continue to improve over the course of the year. And obviously, the other impacts that I spoke to on Graham's question about things like bloodstream-related infections, HDF and the ongoing work we're doing across the operation on improving inflows and outflows is important.

I think the other thing worth noting is mortality is still elevated. So that is something that we continue to try anytime impact through some of these other measures. All in all, I would say it's small numbers. Obviously, I know we're all looking for that to turn positive. But because of a small number, it's not really impacting OI as we have kind of maybe consistently said, but really feeling good about the work that's underway. And obviously, we'll continue to see more as Q2 develops.

The next question comes from Veronika from Citi.

Can you guys hear me?

We can hear.

Two for me, please. The first one is sort of a slightly bigger question, I guess, Helen. I know we're early in the HDF rollout, but just curious to get some feedback from you both in terms of operationally how that rollout is going out, going on in your own clinics, how you're feeling about some of the early signs of mortality benefits that you're seeing, if any, I know it's very early, but to the extent that you could talk about it. And I guess some of the training costs that you've budgeted for in the year, how you're tracking against those? And then I have a bigger picture follow-up question, but maybe we can get this out of the way first.

Sure. And as you know, it's my favorite topic. So we can spend the rest of the call talking about HDF, if you like. [indiscernible] leave aside, really, really happy and excited about how it's going and the progress we're making. We are accelerating at speed now. I mean if you look at our website, you'll see clinics coming soon, and we're already passed the 100 that we were at by the end of the quarter.

So training is going well. Those costs are incurred and being incurred as we had forecast. So that's all fine. The adoption in the clinics is really, really positive. It's easier to train. The staff are loving it. It's less noisy, less disruptive with alarms and beats and things going off. But more importantly, the feedback from our patients is terrific.

We're clearly seeing the immediate benefits of patients feeling better on these treatments, feeling less tired, et cetera. Now I've been pretty consistent on this and kind of maybe just a caution. Obviously, we are tracking the data set from patient 1. We've had -- we've got 100,000 treatments here and over 100 clinics. We are starting to get that data set into a form that we can kind of start to tease out some KPIs and report out on it. But obviously, we want to get a little bit more of the data set under our belt.

So we have kind of said we'll start to -- once we're maybe through half 1 here, start to give more color on those KPIs. But everything so far is in real-world evidence is supporting what we had seen through the studies. So yes, obviously, it's big. It's the biggest thing we've ever done, but the level of excitement and engagement and adoption by our teams, our physicians and our patients is terrific. So very, very happy with how that's going.

That's super helpful, Helen. And I think maybe just to sort of bleed it into my second question. I guess we're all anxiously awaiting that return of the same market to a positive territory. I know you can't predict when that happens. But I guess just fundamentally, we're here again in 12 to 18 months' time, and we haven't seen any progress on same market treatment growth. How will you think differently about operating the business or running the business? We're seeing more clinic closures this year. Just curious kind of high-level thoughts. I know that's not your working assumption, but to the extent that we're there in 2027, what should we be expecting from you in response to that?

Yes. Look, I -- first of all, my expectation is 12 to 18 months, we wouldn't be at negative same market treatment growth. I do expect this to continue to improve. I feel really good about the work the SKC and CG team are doing in addressing a lot of these operational improvements and efficiencies and both addressing inflows and outflows.

Look, I think if we -- if -- and it's a big, big if, we are in a situation where even with -- you have to think about 18 months from now, Veronika, we would have technically also converted about 40% of our machines. So we should also be seeing the real nice impact coming through on HDF. As we have shown this year, where we know we have underutilized capacity or we don't have profitable growth, clearly, we would trim the network accordingly, but that is not our working assumption.

But obviously, every month, every data point gives us a new insight. And I think what we're seeing in the work that we're doing, both on the patient safety, patient quality initiatives as well as HDF, I think all the signs are pointing to that improving mortality, improving missed treatments, improving hospitalizations. And as always, we know that we would have to flex a different cost muscle if need be along the way. And I think what I'm also would commend the team on is as we were looking at this 100 that we've teed up on clinic closures, not just 64 through the first quarter, but that should be done sometime in May. We've already got, I think, close to 90 done through April. So that's also a good proof point that we can move at speed should we need to go deeper here.

The next question comes from Hugo from BNPP.

I have 2, please. First, on the EUR 200 million to EUR 300 million inflation headwind that's in the guide. Could you maybe give us an indication of how you track against that guide and given macro uncertainties, what room do you have with either the top or the low end of that guidance.

Martin you mentioned ACA subsidies expiring, all of you or will you account for patients that are signed up in ACA marketplaces, I think generally, but at least 1, 3 months grace period for the first event, I guess. In other words, would there be a stronger impact in Q2 from your EUR 50 million savings or some type of reversal that we...

Martin, do you want to take the inflation question?

Thank you. So far for the first quarter, we are tracking in line with our assumptions on the inflation side. We also saw only minimal impact from the conflict and from the macro environment. We are closely monitoring that, as Helen outlined. And we are also taking mitigating actions. But for quarter 1, this is well in line with the development. And as we see it as of today, this is also something that is within the band of our assumptions for inflation as well.

Yes. And then maybe on the ACA subsidies, you know that we had guided this impact of around EUR 50 million. Obviously, what we're watching closely is what happened through open enrollment, what the uptake of patients or where patients are getting their insurance coverage since open enrollment closed.

We always said it would take Q1 to play out to see how that was. What we've actually seen in Q1 is maybe lower than planned or lower than thought patient attrition. Some of that -- the mechanics of how it worked was they're also enrolled. They've got -- and they had to make their first payment for their first month of coverage.

We don't know after that first month, whether they stayed on or didn't. There is this grace period that is happening. And then we don't know from an affordability standpoint, whether they will stay on an exchange or move to Medicare or Medicare Advantage after that. So we're roughly at the point where they should be making their first premium. And I think that's a real kind of test point for us.

So while we didn't see much impact in Q1, our expectation is affordability will become an issue. So right now, we believe our assumption of EUR 50 million for the year is still a good estimate, but we would not necessarily start to see that impact until Q2 and obviously then compounded Q3, Q4. So something we're watching closely, but holding the assumption for now.

The next question comes from Aisyah from Morgan Stanley.

My first one is hopefully a quick one on China. Could you quantify the impact from VBP and the tender exclusion in the quarter versus the guidance of, I think, EUR 50 million or a bit less than EUR 50 million that you saw last year? And do you have a clearer view on when you could reenter the tender this year? And then the second question, also hopefully quick is on Value-Based Care. So your performance in the quarter was clearly ahead of your expectations of a decline for the full year. Would this mean that we just see a steeper decline for the remainder of the year? Or does this drive a bit of upside to the original guidance? And at what point do you think you'll have better visibility on the margin side of things?

Martin, do you want to take those 2 financial questions?

Yes, more than happy to. So Aisyah, on China, yes, we gave an expectation that we would see a little bit of below EUR 50 million for the full year. We did see also in quarter 1, about half of that come through as we expected. And this is in line with how we looked at China for the full year. And obviously, also then we do see lower effects in the coming quarters to that extent.

When we talk about Value-Based Care, yes, you are right. We had a bit of an uptick in the quarter where we had a mix of revenues being driven also by prior period adjustments, which is helping us to offset the headwinds that we have from the revenue recognition of a differently casted contracts. I think it's too early given the volatility of the Value-Based Care business, quarter 1 being a, let's say, proof point, so to say, the positive to change the outlook for the year. So we have given you a EUR 300 million assumption, and that is still what we currently work with.

And Martin, if I could push a little bit as well on the inflation side, which you talked a bit earlier. You mentioned you're monitoring the situation closely. But if in the extent that the current conflict is prolonged, which areas of your cost base would you see most sensitive to incrementally higher inflation as a result? So would it be energy, freight, plastics, et cetera? I appreciate you're not seeing any impact at the moment, but in a worst-case scenario.

Yes. When we look at different buckets, typically, you look at energy, you look at transportation costs, everything that's exposed to oil price also on the oil price-based materials like plastics and stuff like that. So on the energy side, we are rather well hedged. So 70% of our exposure is hedged. So I would call that a limited exposure. Having said that, when there would be a continued high oil price dependency, obviously, transportation like with everybody else or plastic-based oil dependencies would see a potential inflationary cost increase if this is very much [indiscernible]. But also, as I said, perhaps one last thing here. We are currently, and that's what I answered Hugo in his question, absorbing that in our guidance assumption for the year.

The next question comes from Anna from Bank of America.

I wanted to follow up on what Veronika was asking about the HVHDF rollout and how the costs are unfolding versus your expectations? I think you said you rolled out 200 clinics versus an implied goal of closer to 500. Should we be thinking that the costs accelerate in Q2 and into the back half of the year, maybe compounding the headwind from the TDAPA roll-off? And then I don't want to get ahead of myself, but how are you thinking about that going into 2027, the cost for the ongoing rollout there? I think previously, you've messaged that the savings from the HVHDF rollout would offset the cost. Is that still the right way to think about it? Or maybe will it be more of a similar magnitude?

Yes. So Anna, our plan is obviously to kind of replace about 20% of the machines of the installed base in 2026. As you can appreciate, the costs are front-end loaded because we have to train. We train, we get installed, we run them and obviously, the benefits lag. So as you can appreciate, the costs will continue to accelerate as we continue to accelerate the clinic closure.

But it's more just kind of linear to the number of machines that we install over the course of the year. I think the piece that you're maybe trying to tease out is we have costs and then the benefits lag, but they'll come a point where the benefits will be absorbing some of those costs in the later years. So that lag kind of sorts itself out on an annualized basis. But nothing -- I don't think anything remarkable to comment on the costs outside of what we had originally guided. And now it's in line with the number of machines that we deploy.

The next question comes from Oliver from ODDO.

The first one is on the payer mix. So over the last quarters, we have seen or you have reported some progress. This was also again confirmed now. Up from now, how you think about further improvements in the payer mix? Is it still some source for additional profitability or at one point of time, it's basically it's becoming more neutral?

And the second question is about Value-Based Care. So in your report, it has also shown a solid increase, I think, 5% of enrollment of new patients. Can you provide some data whether the growth now comes more from CKCC or from commercial programs? And how do you think about further patient growth in VBC?

I can take both of those. In the payer mix improvement, we are very pleased with how we continue to improve that mix. Obviously, that right now, there's no ACA headwinds in that because we're still holding on to those patients. So there is an expectation that depending on what happens with ACA, that might change. The other thing I would say is clearly, we are focused on improving that reach and be focus on profitable growth.

So as we close clinics, we don't hold on to 100% of the patients. We know that. But obviously, the focus here is on the kind of the profitable mix there. And I think also the opportunity to be talking to payers as well about some of these new initiatives that we're focused on, notwithstanding HDF and some of the other piece. So we are pleased with how that is developing and the conversations there and continues to slightly tick up each quarter.

On VBC, obviously, in the quarter, Martin spoke to this already, there was a prior year true-up. But I would say we are -- we've got a new leader in there. We've kind of got a really good strategic focus here on finding the growth in both the contracts and better contracting and premiums as well as member months. So I would say that improvement is coming more from commercial than it is from CKCC. And obviously, we are really focused on improving the contract status that we have there and have had some nice wins and some nice discussions and new relationships with some of the larger payers.

The next question comes from James from Jefferies.

Just a couple, please. Firstly, on operating cash flow. I noticed EUR 227 million in the quarter, up 40%. I guess there is a summary on Slide 12. But just wondering what goes into the other working capital and noncash items. That was a positive inflow of EUR 133 million or nearly 60% of the operating cash flow. Because if one adjust for that line, I appreciate there might be some other stuff that goes in there, it implies a 50% reduction in operating cash flow. So I just wondering if you can give some color what goes into that line and also just confirm if there's any factoring.

And then my second question is on full year, and there was the slide on the outlook assumptions just because that was missing in the deck this time, can you confirm that all of those are still valid?

James, why don't I take the full year outlook assumptions while I'll let Martin maybe have a look at the cash flow question, and we may have a follow back up on that.

Yes, look, we don't include that headwinds and tailwinds slide every quarter. We generally talk about it in full year about what we're mapping and then maybe half year or speak to any major variations. I would say is we look at that internally, that classification that, that is really developing in line with expectations. So nothing significant to point out there. The headwinds and tailwinds are very much from what we've seen in Q1 and our outlook for the year developing in line with as we expected.

What I can say, and I might come back to you, we are driving operating working capital improvements for the underlying cash performance. And on that other piece that you referred to, I would have to understand exactly what you referred to and come back.

The next question comes from David from JPMorgan.

Sorry to rebang on the both ACA and cost inflation. Maybe first on ACA. I just wanted to double check. So have you recognized all the revenues from patients coming through? And then if they fall off sort of going forward from here, will you have to go back and readjust numbers or take provision where we could make some sort of provision through the first quarter just in case those guys do come off and then you might be able to write it back later if they don't? And the second question is on cost inflation maybe for Martin. Just wonder what percentage of your COGS in Care Enablement is particularly associated with plastics and actually what you're seeing in terms of plastic inflation there?

Yes. David, on the ACA question, obviously, we have a patient, we would be billing for that treatment for that patient. So there's no kind of -- it's just particularly it's billed. I think our concern is more if they fall off insurance or they go out of the system that we lose that patient. And obviously, that revenue that comes from that. So I think that's why we can say there's not really an impact in Q1 because our patient census didn't have the attrition that we first thought.

Now obviously, we're also looking pretty hard at the front-end process on insurance verification and things like that. So there shouldn't be an impact. We just take it as the patient is there and then doing the insurance verification to make sure we're billing accordingly. So I think that's why we're saying we'll hold the assumption because we don't know if these patients will fall off once they make their first premium payment in Q2, Q3 or rest of the year. They do have to be covered. If they're on, they will get covered by the insurance company in what we call this grace period, but it's after that, that is the risk for the patient coming off the exchange. Martin, maybe you can talk about the inflation?

So David, regarding the inflation question, as I said, we are monitoring the situation closely. There is multiple buckets where oil dependency impacting transportation cost is one, plastics are another one. I don't want to give you a number of our costs because we have a supply chain that has different exposures.

Obviously, we are manufacturing also our plastic parts like the blood lines or like also other consumables in different locations. And as such, it is not a simple extrapolation. We are working on this. We are mitigating the effect. We have it inside our inflation guidance that we gave for the market. And I think that is from our perspective, the right way to look at it.

The next question comes from Falko from Deutsche Bank.

Two questions, please. The first one, can you remind us how much of your Care Enablement sales are coming from China? And how was growth excluding China in the first quarter for the segment? And then secondly, on Care Delivery, the organic growth in the international business was a tad softer than in previous quarters. Was there any particular reason for that? Or was that just normal quarterly volatility?

Yes. On the China one, Falko, we said it's about 7% to 10% of the revenues that we have in Care Enablement. It is a relevant market. It's also an attractive market, and we have not disclosed for the quarter what the top line impact is overall?

Yes. And then your question on CDI, as you know, we are -- we're kind of continuing to refine that portfolio on kind of where that treatment growth is coming. It was -- it does look a little bit lower, but don't forget last year, we had Brazil in the base. So as we look at this market by market, we're not concerned with what we're seeing. So I think it's just maybe a tough comp because of Brazil.

And the last question comes from Richard from Goldman Sachs.

Just a follow-up on China for Care Enablement. Between the stricter tender requirements and VBP, how are you seeing competitive dynamics in that market change, if at all? And Martin just referenced China as being an attractive market. What kind of scenario is embedded in your medium-term plans for Care Enablement in China, please?

Yes. Richard, look, China is an attractive market for us. It's a large market. The profitability is there despite some of the challenges that we've already experienced. I think we're eyes wide open of what it takes to succeed in China. Obviously, we're hearing this across med tech, the competitive dynamics are changing.

I think for us, it's about having the right strategy and the right go-to-market approach in China and the right portfolio of what is local for local and what is really premium. So we have some good assumptions into our mid-range plans. We are obviously getting under the current environment and what the future portfolio should look like for China. And obviously, if these dynamics continue to evolve, we will strategically adjust accordingly on the portfolio.

We know we were -- we had -- we were later into China than some med tech companies. So we learned a lot. Even with that, we obviously had some impact, and you saw that hit us last year. But a lot of the focus is on what is the right portfolio to have in China for the China market, what can we do local, what can we partner. And I think then we have to look at China in relation to the global portfolio that we're developing and see what it is that we need to have offered there for continued success. But then I think there's more to come here as we continue to look at that strategy and the portfolio in light of these changing regulations that are happening in real time.

Thank you. So with that, we have answered all questions. The time is up, so perfect combination. And with that, thank you for being so interested that we filled more than an hour. And with that, I'll say thank you. See you on the route on conferences and around the world.

Thanks, everybody. Have a good day. Bye-bye.

Ladies and gentlemen, the conference is now over. Thank you for choosing Chorus Call, and thank you for participating in the conference. You may now disconnect your lines. Goodbye.

Ladies and gentlemen, welcome to the report on the Fourth Quarter and Financial Year 2025 Conference Call. I'm Moritz, the Chorus Call operator. [Operator Instructions] The conference is being recorded. The presentation will be followed by a question-and-answer session. [Operator Instructions] The conference must not be recorded for publication or broadcast.

At this time, it's my pleasure to hand over to Dr. Dominik Heger. Please go ahead, sir.

Thank you, Moritz. Welcome, everyone, to our earnings call for the fourth quarter and the financial year 2025. As always, I start out the call by mentioning our cautionary language that is in our safe harbor statement as well as in our presentation and in all the materials that we have distributed earlier today. For further details concerning risks and uncertainties, please refer to these documents and to our SEC filings.

We will have 1 hour for the call. In order to give everyone the chance to ask questions, we would limit the number of questions to 2. Thank you for making this work as always. We will begin our full year financial results by reviewing key strategic milestones achieved in 2025, which mark the end of our midterm strategy. Next, we will analyze fourth quarter outcomes and present our outlook for 2026 and different horizons beyond.

Let me now welcome Helen Giza, CEO and Chair of the Management Board; and Martin Fischer, our Chief Financial Officer. Helen, the floor is yours.

Thank you, Dominik, and welcome, everyone. It's great to have you with us today. We appreciate your continued interest in Fresenius Medical Care.

2025 was a milestone year for Fresenius Medical Care. We delivered an outstanding step-up in profitability, having achieved the upper end of our 2025 financial outlook and closing the year with an exceptional fourth quarter performance.

The progress we realized in 2025 and the momentum we have built over the past 3 years reflects the consistent focus and dedication of our employees around the world. Their commitment is the foundation to our success as we strive to lead kidney care through exceptional care and innovation, and I'm extremely appreciative of the progress we made for our patients and the exciting path we have ahead of us.

Before we delve into the fourth quarter specifically, I would like to take a few minutes to reflect on the key highlights of the past year and how we are positioning Fresenius Medical Care for the next phase of value creation. Beginning on Slide 4. At our Capital Markets Day last June, we officially launched our new 2030 strategy, FME Reignite. This strategy is designed to accelerate growth and drive ambitious profitability improvements aiming for industry-leading margins. FME Reignite represents a pivotal step forward for us as we shift our focus towards accelerated innovation and growth. As part of our FME Reignite, we carved out our value-based care business, establishing our third operating segment. This strategic decision further enhances our reporting transparency and reflects the continued growth in value-based care, which generated over EUR 2 billion in revenue in 2025. We not only initiated but accelerated a EUR 1 billion share buyback program, reflecting our strengthened financial profile, further reduced net debt and commitment to regularly returning excess cash to shareholders.

In 2025, we marked an important milestone with the successful soft launch of our 5008X CAREsystem in select FME clinics in the U.S. to accelerate to the large-scale clinic conversion in 2026. As we speak, we are rolling out at speed the 5008X CAREsystem to our U.S. clinics and are setting a new standard of care in the U.S. with high-volume HDF therapy.

We accelerated our FME25+ savings program through the end of 2025, achieving sustainable savings above our already increased target. This supported a significant step-up in profitability with a group margin of 11.3%, driven by all 3 operating segments and landing well within our target margin band for 2025.

Turning to Slide 5. For 2025, we delivered revenue growth at the upper end of our outlook leveraging our vertically integrated business model to overcome a difficult market environment and unanticipated headwinds from lower volumes and elevated medical benefit costs. Supported by an exceptional fourth quarter performance, the 2025 operating income growth of 27%, reached the top end of our ambitious outlook for the year.

Next on Slide 6. At the beginning of 2023, we set demanding midterm profitability targets to 2025 as we began a 3-year journey to build a stronger and more resilient company while committing to significant operational improvements. I am proud to say that we have delivered on that commitment. We increased our Care Delivery margin to 13.1%, achieving the middle of our target band for the segment. We more than quadrupled our Care Enablement margin from nearly 2% to just over 8%. If you recall, at the time of setting the targets, we had just 2 operating segments with value-based care still part of Care Delivery. This is why there was not a specific target for value-based care. However, the improved performance in that segment is reflected in the group development.

While returning capital to shareholders in the form of dividends and share buyback, we are in a significantly stronger financial position as we have reduced net debt and improved our net leverage ratio from 3.4x at the end of 2022 to 2.5x at the end of 2025.

Turning to Slide 7. We also delivered on the committed key strategic initiatives. This execution supported our improved operational performance to date and, importantly, has positioned us well as we transition towards the next phase of growth and innovation. With our FME25+ transformation program, we committed and over-delivered, exceeding our already upgraded sustainable savings target with EUR 804 million in realized sustainable savings to date.

We executed our portfolio optimization program at pace, focusing our international clinic footprint to 25 core markets across 34 countries, considerably down from 49 in 2023. A key pillar of our strategic plan announced in 2023 was to unlock value as the leading kidney care company. The launch of our 5008X machine in the U.S. and leadership in renal value-based care are powerful examples of how we are delivering on that ambition while raising the standard of care for patients.

Next on Slide 8. Cash generation is an inherent strength of our business model. In 2025, we generated EUR 2.7 billion in operating cash flow, clearly demonstrating this capability. This strong cash performance supported by disciplined capital allocation provided the flexibility to invest in our core business for profitable growth while returning excess capital to shareholders. Through our accelerated share buyback program, we repurchased shares for a total amount of EUR 586 million in 2025 completing the first tranche of our initial EUR 1 billion program, which supported our EPS growth. In January of this year, we initiated the next tranche with around EUR 414 million, further accelerating the share buyback program. For the 2025 financial year, we plan to propose a dividend of EUR 1.49, representing a 3% increase to 2024 and corresponding to a payout of 33% of adjusted net income, well aligned with our target payout ratio of 30% to 40%.

Let us now look at our fourth quarter performance, specifically, beginning on Slide 10. The cap off a strong 2025, we delivered a truly exceptional fourth quarter financial performance. We realized strong organic revenue growth of 8% and earnings growth of 53%, resulting in a margin of 13.9%, a remarkable 430 basis point increase over the prior year. This was supported by our FME25+ savings program with EUR 63 million in additional sustainable savings in the fourth quarter alone. We recorded exceptional EPS growth of 68%, driven by our accelerated share buyback program. And in parallel, we further improved our net leverage ratio to the low end of our target corridor.

Let's review some fourth quarter highlights from each of the operating segments on Slide 11. Beginning with Care Delivery in the U.S., same market treatment growth was broadly flat as volumes remained under pressure from the follow-on effects of the flu-related elevated mortality in the first half of the year and a high level of missed treatments in December. Our Care Delivery international markets delivered solid 1.7% same-market treatment growth. Underlying performance in Care Delivery was positively supported by favorable U.S. rate and payer mix development. In addition to the underlying trends, Care Delivery performance was boosted by around EUR 40 million higher-than-expected benefit from phosphate binders that fall into the TDAPA regulation, bringing it to around EUR 220 million contribution in 2025.

We shared in our third quarter earnings call our quality initiative on bloodstream infection prevention by using different types of catheter-related bloodstream infection interventions. In the fourth quarter, we made significantly faster progress on the initiative than assumed. Both interventions require a physician prescription, and one of those solutions prescribed by physicians falls under the TDAPA regulation until the middle of 2026. It has contributed around EUR 90 million in 2025, and it will be a year-over-year neutral effect for 2026. This has helped us in 2025 to offset around EUR 80 million higher medical benefit costs in the year that we had not anticipated at the beginning of the year. Of course, the higher-than-expected TDAPA contribution in 2025 raises the outlook base for 2026 even higher, and I will address the impact in the outlook section.

As I highlighted earlier, we started with the launch of our 5008X machine in select clinics in preparation for the large-scale expansion of access to high-volume hemodiafiltration in 2026.

Turning to Value-Based Care. We realized positive operating income in the quarter, driven by favorable savings rates, which was partially offset by an unfavorable effect from CKCC programs. This development brings our 2025 value-based care performance to breakeven, a notable achievement from a historically loss-making position. In the fourth quarter, we realized an increase in member months from further contracting growth as well as the continued growth of our provider network.

The fourth quarter in Care Enablement saw continued positive pricing contributions. However, in China, we faced negative impacts from volume-based procurement as well as other regulatory policies, resulting in stricter tender requirements and delayed tenders. This weighed on our revenue and earnings development in the quarter and is also expected to impact 2026.

We continue to capture sustainable savings as part of FME25+ driven by disciplined execution of the next level of footprint optimization across both manufacturing and supply chain. And also in Care Enablement, preparation for the large-scale launch of the 5008X and shipments of new consumables continue to advance as planned.

I'll now hand over to Martin to walk you through the fourth quarter financials in more detail.

Thank you, Helen, and welcome to everyone on the call also from my side. I will begin on Slide 12. In the fourth quarter, we achieved organic revenue growth of 8%, supported by Value-Based Care and Care Delivery. At constant currency, revenue increased by 7%. Care Enablement revenue development was negatively impacted by regulatory pressure in China. Divestitures executed as part of our portfolio optimization plan, negatively impacted revenue development by 70 basis points. Adjusted operating income increased by an impressive 53% on a constant currency basis. This increase drove a clear step change in our group margin to 13.9%. Special items negatively affected operating income by EUR 111 million. This comprises costs related to FME25+ and our continued portfolio optimization as well as effects from the remeasurement of our investment in Humacyte.

Turning to Slide 13. This slide highlights the remarkable 430 basis point margin improvement, driven by especially strong contributions from Care Delivery due to significant higher contributions from TDAPA regulation than we had expected and Value-Based Care contributed positively as well. Net corporate costs improved by EUR 5 million. This includes a favorable EUR 2 million development in virtual purchase power agreements -- power purchase agreements compared to the prior year period. Foreign exchange rates developed unfavorably with a negative EUR 43 million translational impact. The average U.S. dollar exchange rate in the fourth quarter was 1.16 compared to 1.17 in the third quarter.

I will now walk you through the financial developments in each segment, starting with Care Delivery on Slide 14. Care Delivery realized 7% organic revenue growth and 6% revenue growth at constant currency. In the U.S., organic revenue growth of 8% was driven by positive impact from TDAPA regulations, favorable rate and mix effects and reduced implicit price concessions, demonstrating progress in our revenue cycle management initiatives.

Care Delivery International delivered 3% organic growth. Divestitures negatively impacted Care Delivery revenue growth approximately by 120 basis points overall. Care Delivery achieved 45% earnings growth and 440 basis points margin improvement to 16.4%. Business growth benefited from higher-than-anticipated contributions from phosphate binders. The significantly higher prescription and adoption rate of one of the antimicrobial catheter solutions that falls under TDAPA regulation also contributed around EUR 70 million in the quarter, helping us to offset the not anticipated around EUR 80 million higher medical benefit costs in the fiscal year.

Business growth also supported by positive rate and mix effects in the underlying clinic business as well as the phasing of a content agreement on certain pharmaceuticals. Increased labor costs, which include a significantly elevated medical benefit costs, were partially offset by FME25+ savings.

Turning to Value-Based Care on Slide 15. Value-Based Care again accelerated revenue growth, achieving 42% organic growth. This significant increase was driven by further growth in the number of member months largely attributable to further contract expansion. Value-Based Care realized positive EUR 29 million in operating income, driven by improved savings rate, FME25+ savings and partially offset by an unfavorable effect from CKCC programs.

For the full year, Value-Based Care was positive EUR 3 million compared to a loss of EUR 28 million in 2024, marking the first year of breakeven earnings development for our Value-Based Care business.

I will next turn to Care Enablement on Slide 16. Revenue for the segment decreased by 3%. Lower volumes driven by negative impacts from value-based procurement and other regulatory policies in China were partially offset by overall continued positive pricing momentum. Care Enablement earnings declined by 6%, primarily due to unfavorable business development in China and currency transaction effects. This was partially offset by positive pricing. Further sustainable savings from the FME25+ program, primarily driven by improvements in supply chain and manufacturing compensated for the expected inflationary cost increases.

Next, I will look at cash flow development on Slide 17. In the fourth quarter, operating cash flow strongly increased versus the prior year, mainly driven by higher net income, improvement in cash collection and prior year phasing of income tax payments. Our disciplined use of cash fully aligned with the priorities set out in our capital allocation framework. In the quarter, we purchased existing production sites in Germany that had previously been leased for a total of EUR 181 million. We reduced our net debt and lease liabilities compared to the prior period by 6%. We accelerated our share buyback program, repurchasing over 14 million shares for a total amount of EUR 585 million, representing 4.8% of share capital in 2025. Since the end of the quarter, we have repurchased an additional 4.2 million shares for EUR 163 million. We ended the quarter with a further strengthened net leverage ratio of 2.5x, improving to the lower end of our target band. We reconfirm our target band of 2.5x to 3x.

I will now hand back to Helen.

Thanks, Martin. I will pick up with FME25+ on Slide 18. In 2025, the FME25+ transformation program further accelerated its positive momentum, delivering EUR 238 million in additional sustainable savings for 2025, ahead of the upgraded target of around EUR 220 million. Accumulated savings of the entire program reached EUR 804 million. The successful execution of FME25+ and the strengthened foundation we have established as a result has allowed us to identify additional opportunities to unlock sustainable savings that were not necessarily visible or accessible before.

Also, the flat same-market treatment growth of the last years triggered the decision to further adjust the clinic footprint in the United States while balancing at the same time, the capacity for the expected future growth of 2% plus once mortality has normalized. We have again structurally assessed changes to developing and attractive growth areas across the country and decided to close the least promising clinics in the United States. This results in a footprint rationalization affecting around 100 clinics in 2026. Building on the momentum, we will further accelerate and expand FME25+. We expect costs and savings of EUR 400 million for the years '26 and 2027 for a total of EUR 1.2 billion of sustainable savings by the end of 2027.

Let me now move to our outlook section on Slide 20. To frame our 2026 outlook, I will begin with our most important operational priority, the 5008X rollout in the U.S. This represents the largest transition of clinic infrastructure in Fresenius Medical Care's history. Our large-scale launch of the 5008X is now underway with the target of replacing around 20% of the installed base in our own clinics this year. Importantly, this replacement strategy will deliver substantial benefits, including reduced mortality and improved outcomes for patients, increased operational efficiencies and a stronger competitive position for our U.S. clinic network. However, in the first year of the large-scale rollout, our Care Delivery U.S. business will face an OpEx headwind from rollout-related costs.

In 2026, we will train over 7,200 nurses and technicians and transition about 36,000 patients to the 5008X machine across 28 states. This requires significant training effort, but we expect to improve efficiency as the rollout progresses. We will start to see operational efficiency benefits in converted clinics ramping up as machines are converted. As a reminder, eligible patient can typically be transitioned from HD to HDF within a few weeks. And once patients are on high-volume HDF for 3 months, the improved outcomes, including lower mortality, will start to ramp up over the following 2.5 years. Therefore, we would expect that the positive effects will only start to become visible later in the year with greater benefit to increasingly supporting results in 2027 and beyond.

Still early days, but our rollout is well on track and it's exciting to start to see more and more clinics converted every week. And by the time we get to half year results, I would expect to have a more detailed update on how the rollout is progressing.

I now move on to our outlook for 2026 on Slide 21. Following a significant step-up in profitability in 2025, we are comparing against a very high base in 2026, while significant temporary benefits from TDAPA regulations start to phase out in 2026. Our 2026 outlook underscores our disciplined focus on sustaining this higher baseline. While we expect Care Delivery and Care Enablement to grow, we are assuming broadly flat revenue growth, largely reflecting changes in Value-Based Care's risk contracting and related revenue reductions. For earnings, we assume operating income will remain on a consistent level with an upside/downside range of a mid-single-digit percent change. We clearly target to maintain our enhanced profitability while investing for future value creation and navigating regulatory headwinds. This implies a margin range of 10.5% to 12% at group level.

I'll now hand you back to Martin to walk you through the assumptions between our 2026 outlook on Slide 22.

Thank you, Helen. Starting with revenue. For Care Delivery, we carefully assume flat same market treatment growth in the United States, including a normal flu season similar to the '23-'24 season. This does not change our expectations of returning to 2%-plus as mortality normalizes and patient outflows improve. We are excited about the opportunity to reduce missed treatment and patient outflow by further enhancing the quality and patient outcomes as part of our FME Reignite strategy.

Increasing penetration of high-volume HDF and antimicrobial catheter solutions, further expansion of Value-Based Care as well as benefits from ESRD patients using GLP-1 are supporting this path to 2-plus percent growth. Internationally, we are assuming solid same market treatment growth in 2026, and we assume the usual moderate reimbursement rate increases. Following a significantly greater than anticipated benefit from TDAPA regulation in 2025, we assume a headwind for the starting phase out in 2026, also on the revenue side.

In Value-Based Care, we are assuming negative revenue growth of around EUR 300 million due to changes in risk contracting that result in lower revenue recognition. We do not expect this to impact earnings development.

In Care Enablement, we assume a continuation of the solid organic volume growth. China remains challenging, and we are assuming moderately negative impact as we address regulatory policy changes and review our portfolio and strategy accordingly. At the group level, we are assuming a negative 30 basis point impact from portfolio optimization realized in '25 and '26. Our currency assumptions are based on euro-U.S. dollar rate of 1.18.

Turning to the earnings side. We are assuming EUR 250 million to EUR 350 million of business growth, driven by favorable pricing developments and revenue cycle management initiatives. We expect incremental FME25+ savings of EUR 250 million with related onetime cost of EUR 350 million. We are assuming inflationary pressure of EUR 200 million to EUR 300 million, which includes a typical 3% net labor cost increase as well as the usual cost inflation across all of our operating segments. We are facing regulatory impacts that we assume will impact earnings development by EUR 150 million to EUR 200 million. In Care Delivery, we assume regulatory headwinds from phasing out of phosphate binder, TDAPA contributions and the negative effect from the expiry of the extended tax subsidies for ACA contracts.

Strategic investments of EUR 100 million to EUR 150 million include 5008X rollout costs, mostly in Care Delivery as well as investments in our IT platforms such as the required transition to SAP S/4HANA, supporting the harmonization and standardization of core business processes across our organization. The costs related to the IT platform investment, making up about half of the EUR 100 million to EUR 150 million, will be reflected in our Corporate line. We will continue to further optimize our portfolio in 2026 and assume costs of around EUR 50 million.

To help with your modeling, we are assuming Corporate costs of EUR 200 million to EUR 220 million, a net financial result negative EUR 340 million to EUR 360 million and an effective tax rate of 22% to 24%. And driven by our 5008X rollout, we assume an increased operating income intersegment elimination of around minus EUR 100 million. While we do not provide quarterly guidance, from a high-level phasing perspective, we expect a stronger first half of 2026 before TDAPA benefits begin to phase out in the second half of 2026. This phasing is different to normal patterns for our underlying business and industry.

I will now hand over to Helen for Slide 23.

Thanks, Martin. We knew 2026 will be a transition year, which does not change our aspiration to achieve industry-leading growth and margins. This aspiration remains firmly intact. The year 2026 will serve as a pivotal milestone as we continue to strategically position ourselves for sustained value creation.

During our Capital Markets Day in June, we communicated that margin development in Care Delivery is expected to be more weighted towards the later part of the period, whereas Care Enablement demonstrates a steadier pattern of improvement. To enhance transparency regarding the group's future trajectory, we have added an aspiration for 2028. We see a clear path toward operating income growth, targeting a compound annual growth rate of 3% to 7% through 2028. This growth will be driven by the focused execution of our FME Reignite strategy, which includes the 5008X rollout and our quality strategy to reduce missed treatments and mortality as well as continued progress in revenue cycle management.

In addition, increased sustainable savings from our FME25+ program will contribute to this earnings growth. If we exclude the noise resulting from the interim TDAPA tail and headwinds throughout this period, our implied earnings growth trajectory through 2028 would be in the low teens on a CAGR basis. This shows how strongly the underlying operational performance is unfolding. Our 2030 aspirations are fully underpinned by the strategic priorities and momentum of FME Reignite. At the time of the Capital Markets Day, we have not given explicit revenue growth aspirations to 2030 as the Value-Based Care segment has an inherent volatility from changes in risk contracting, which makes top line forecasting less predictable. Therefore, we have excluded Value-Based Care from our revenue growth aspirations.

For Care Delivery, we anticipate a lower to mid-single-digit revenue growth CAGR. And for Care Enablement, we expect a mid-single-digit revenue growth CAGR.

Our 2030 margin aspirations to achieve industry-leading margins in all of our operating segments remain unchanged. At the group level, we maintain our aspiration to deliver an operating income margin in the mid-teens. We maintain the same 2030 margin aspiration for both Care Delivery and Care Enablement. Recognizing that Value-Based Care is a structurally lower margin business in a relatively nascent industry, we have a low single-digit operating income margin aspiration to 2030. We are well positioned for continued value creation in the years ahead.

That concludes my prepared remarks. And now I'll hand it back to Dominik to begin the Q&A session.

Thank you, Helen. Thank you, Martin. Before I hand over for the Q&A, I would like to remind everyone to limit your questions to 2, please. And with that, I hand it over to Moritz to open the Q&A session, please.

[Operator Instructions] And the first question comes from Hassan from Barclays.

Firstly, if you could please talk about some of the key drivers of the acceleration of EBIT growth from flat at the midpoint of guidance this year to propel you to the midpoint of the '25 to '28 -- 2028 range of 5%? And how much of this is reliant, if at all, on an acceleration in same market treatment growth?

And then secondly, on Care Enablement, could you quantify the drag from China tender modifications and delays in the quarter? And how you're thinking about this persisting throughout 2026?

Thanks, Hassan. I think I'll take both of those and make sure I've got your first question covered. So we'll maybe tag teammate if you need more here. Obviously, what you can see is that we have a flat 2026 versus the midterm growth CAGR of 3 to 7. Obviously, you can hear from the talk outline that we have -- in fact, 2026 is a year of investment both in HDF and in systems platforms. And of course, we're calling out quite explicitly, deliberately the impact from the regulatory pieces of TDAPA and ACA.

I think the way to think about it is as you look at the headwinds and tailwinds slide that we know was quite detailed this year deliberately that you can kind of see the levers of the pluses and minuses and the range that is there. Obviously, there's a lot of underlying operational work that we're focused on. So once you kind of get past the TDAPA and binders piece, the business growth on rate and mix and kind of the business growth and revenue cycle improvements start to come through.

As always, we have the ongoing -- sorry, headwinds of labor and inflation. So kind of -- I think you kind of got the building pieces -- building blocks there. And of course, the accelerated FME25 just adds to all of that. We -- in Care Enablement, that margin improvement is kind of constant over time, both from the top line levers that they're pulling as well as the FME25 levers that they're pulling there. In terms of the kind of the same market treatment growth and what impact, obviously, we're calling it flat. We know where we've been. We kind of obviously have been coming out of December, missed treatments from weather and flu. We haven't seen flu data yet. So we just felt it was safe to call that flat.

And then gradually improve over time to get back to that 2% plus by pulling the levers of the mortality improvement that we outlined on the call, not just our antimicrobial measures, but also HDF as well as all of our quality safety measures as well. So kind of a lot going on there for sure.

In terms of the China drag, clearly, that's been -- let me just maybe frame up China. For Care Enablement, China is about 7% to 10% of the revenue. It's a great market. We like the market. We like the profile. Obviously, with the change in regulatory policies as well as tendering delays, we did have about a 50 million EBIT impact in 2025. We are expecting an impact in '26, but lower than that. But obviously, at the same time, we are looking at how can we maximize. I'll go to kind of our local China by China policies there. So the team is kind of working on that as well. So while there is an impact, it's a lower impact than what it was in 2025. I think I covered everything.

The next question comes from Veronika from Citi.

Two questions for me, please. And apologies they're both focused on the headwinds, I guess, but just trying to understand the moving parts. Helen, thank you for the phosphate binder comment. I just want to confirm that the number there is EUR 220 million and what your expectation is for '26 and '27, as that sort of unwinds? And then related to that, this catheter -- the antimicrobial catheter benefit, I think I caught you saying something along the lines of it should be neutral year-on-year, if you can elaborate on that. I'm very sorry, I'm missing that sort of link how it flows from '25 to '26.

And then my second question is just your thoughts on the ACA subsidy headwinds as we move to '27 and '28. Obviously, your closest competitor has outlined figures for that? Should we use those as a baseline? Or are you expecting the shape of the headwind to look differently either?

Veronika, I'm more than happy to talk about the headwinds. So we have called out regulatory effects of EUR 150 million to EUR 200 million. And that includes the headwinds from both binders as well as ACA. We have also quantified ACA before at around EUR 50 million. We also said we're going to see how it plays out. So we have only quantified 2026. We have not given a further outlook. And we'll see how that plays out in the next weeks and then we might update our assessment in that.

Also in that EUR 150 million to EUR 200 million is the year-over-year decline that we see for binders. To your point, yes, we had about EUR 220 million of positive contribution in 2025. And we have also called out before that we see about EUR 50 million staying in our clinics and another EUR 50 million staying out of our pharmacy business. So there is a headwind or a total positive contribution that stays in '26 for EUR 100 million, leading to a reduction of -- bigger than EUR 100 million from '25 to '26. And those 2 effects combined are the EUR 150 million to EUR 200 million that we have there.

To the catheter lock solution, yes, you heard correctly, there's no year-over-year effect. We do not have an effect because it is still under a limited half for the first half. I hope that clarifies the question.

Veronika, I'm glad you're not the only one to pronounce that. The capital piece is half, half 2 '25 versus half 1 '26 impact. So just to put a finer point on that. That's why the impact is because of the short TDAPA period on one of the solutions. We got a benefit in half 2, mostly towards back end of the year and we're expecting a benefit in half 1 before that TDAPA period expires. So that's why year-over-year, it is neutral, but it will add one key phasing for sure.

The next question comes from Oliver from ODDO BHF.

The first one is on patient volumes. So can you comment on the impact of higher insurance requirements on your patient volume development?

And second question is also on your outlook for the patient volume growth. So you mentioned that missed treatments have stayed at an elevated level, but that's also not really new. Right now, we see flu season is very mild. It's not over yet, but I would say there's a high probability that it's not as goo as it was last year. And later this year, there should also come some of this annualization effect from the higher insurance requirements and as well as slightly improving mortality due to the HVHDF introductions. So if I put all together, it looks for me that the patient volume development must be better than it was in '25. So is it really only, let's say, a conservative stance? Or have I missed anything in this Q&A?

So look, I deliberately used the word careful in terms of our assumption. We're assuming a normal flu season. We saw it go up. We've seen it come back down. I think we can -- looking at what we've seen today, we're saying a normal flu season, not like last year. I think we also know that when you go pick up the headlines this week to see the weather. So we do have elevated missed treatments, whether that be weather, illness, flu. Obviously, as you know we've been pretty consistent on the data lag that we see in 6 to 8 weeks. So by the time we get through Q1, we'll have a better sense.

As we get through Q1, we're also going to have a better read on what open enrollment look like and how the ACA kind of choices actually develop. Open enrollment, why you could say it was the end of the year and you should start to see it in first quarter. Actually, it's not until they enroll and pay the first month premium, do you even know what they talked. So that's going to give us a lag as well. So I think we're watching that closely. Obviously, you'll see the headlines on what the overall enrollment looked like. And obviously, if it didn't drop as much as we expected, then we'll be able to reconcile that accordingly.

And then, as you say, with HDF, we're full steam ahead, converting clinics, converting patients. And while it's too early to see results, we should get the benefits kicking in there. And in fairness, along with the overall underlying improvements that we're working on in -- on mortality, including the catheter lock solutions and just kind of the patient outflows. But we felt with where we are, the right thing to do was to call this flat for 2026. We know we're talking small numbers on small numbers and the small number piece were plus 0.1 or minus 0.1. We know that doesn't make a difference on the kind of on this EBIT range. So we feel like that is the right place to call it for 2026, and we'll update accordingly.

Okay. Can you also comment on the higher insurance requirements, please?

Maybe I'm not understanding the higher insurance requirements question. Are you talking about those people that maybe didn't enroll in ACA and then had to go to a different insurance policy?

Yes. Or let's say, I'm speaking about the active improving -- actively steered improving patient mix, choosing your patients more selectively.

Okay. I think our -- sorry, thank you. There's a lot happening on insurance and enrollment. So thank you for clarifying that. So yes. Look, I think on mix, we're feeling good about our patient mix. I think the only piece that we're watching is -- and that's why it maybe does come back to the ACA comment is how did open enrollment really end up? And did that change -- did we change anything when -- once we see that kind of first month payment come through, but nothing else. I think that nothing else there.

The next question comes from Hugo from BNP.

I have 2. First on U.S. volumes. Helen, if I can push you a bit further. One of your competitors mentioned that they expect a very slow start into the year in negative territory. So just the question is like whether or not you expect to see the same trends at play? And as a result, and assuming that you would also agree with the statement of getting back to 2% volume growth by 2029, how much of U.S. dialysis volume recovery is a prerequisite to achieve the mid-single-digit growth CAGR in Care Enablement? So I guess, how much of the Care Enablement growth is intertwined with the volume recovery in the U.S.?

And second, on FME2025. Historically, you guys had a balanced recognition of both benefits and costs from the efficiency program in FY '26. It seems that you have a bit more of one-off costs that you recognize. So just curious about where exactly the lag between the cost and the benefits comes from.

Thanks, Hugo. I'll take the volume question, and Martin can give a bit more color on the benefits and costs. We touched on some of it.

Look, I -- Q1 is always a tough quarter to know where your volumes are going to be, both with the weather and the flu-related effect. So look, I know where we ended up and you see where we ended up in Q4. I think we just got to wait to see the data to know how Q1 is going to play out. I'm not going to comment on a quarterly phasing here. We kind of really need to kind of see what that first quarter is going to look like with this -- with some of the messiness that we're seeing, particularly on weather. Look, I -- and I'll say market treatment growth, I think all the efforts that we are doing, and I think particularly the excitement around 5008X and all of our patient safety and patient quality initiatives that all go toward reducing hospitalization, improving mortality, reducing missed treatments, all of that will continue to give benefit over time. So I'm not time stamping it, but clearly, we have improvement built into our 3-year and 5-year outlook.

Martin, you want to do FME25?

More than happy to cover the FME25. So you're right, we are front-loading 2026 a bit. And also, we have then in '27 a higher savings contribution. And as you would expect, at the end of the program, a lower onetime cost because we want to have savings effectiveness in 2027 as well.

On the '26 front-loading, you see that a lot of the measures are tilted of the remaining EUR 400 million also towards Care Delivery with 40% contribution. And there, the clinic footprint optimization that Helen referred to as well as efficiencies that we drive in real estate are more front-loaded on the onetime cost and then they will contribute subsequently to the savings. I hope that gives a bit more color.

The next question comes from Graham from UBS.

It's just on the Q4 point around what was obviously a really strong beat, particularly in Care Delivery. I'm just trying to work out the phosphate binder and then this TDAPA catheter contribution. It just looks to me like that was pretty much all of the growth, I suppose, effectively year-over-year. Is that TDAPA payment, does that -- is that like more than half of the EUR 90-odd million that you categorized for the full year '25?

And then just a follow-on. When we think about whatever about '26, when we think about '27, it looks to me that there's still like a further EUR 250-maybe million to come out from TDAPA plus phosphate binders into '27. Is that overstating it? Or how do you think about that in terms of your ability to grow then in '27?

Yes. So Graham, let me tackle the TDAPA contribution and because I outlined in quarter 4 that, yes, there was a contribution from the catheter lock solution of about EUR 70 million in the quarter, and that was due to the much higher than anticipated adoption and prescription that we saw for one of those 2 dilutions that was under TDAPA and the other one is not. So that was something that drove some of the higher contribution, so to say. We outlined that, that solution will be year-over-year, not a head or a tailwind because we expect that it's a similar contribution for 2026. In wholesale in '25, we had EUR 90 million and it was Q3 and Q4 and then in Q1 and Q2 '26. So it will be a non-year-over-year effect, yes.

To the earlier point, I think I was very clear on binders where we ended the year with EUR 220 million, and I outlined how that is. So I'm not going to repeat and dig into that again. But I think with the EUR 150 million to EUR 200 million regulatory headwinds, we have provided also a very clear building block.

Yes, Graham. And maybe I'll just pick up on your -- go ahead.

I was going to say just the relevance for '27, like it just feels like this TDAPA piece was a bit of a -- obviously, a great positive surprise. But just when we think about modeling it going forward, what's going to happen in '27?

Yes. So look, on the -- on both actually, expectation is that TDAPA period ends in 2026, and there will be a payment that then goes into the bundle. So we don't know what that bundle payment will be in 2027 yet or actually even halfway through 2026 for the catheter lock solution. So obviously, we know that some of that's going to stay in the business. And on our pharma business, it doesn't go to 0. What we're going to have to see is go through 2026, so we have an assumption is how the pricing -- how the generic -- sorry, how the branded pricing erodes as the kind of the move towards these products going into bundle develops. So we're not breaking this out year-by-year. It's why we've given the 3-year CAGR. And you also heard me speak to the low teens CAGR we get past all of this binder piece.

So I think there's obviously positive benefit in '25 and '26. It starts to erode in '26, and we have to see how much it erodes that doesn't stay in the bundle in '27. But on the back of that, we've got all the other initiatives taking hold, particularly in Care Delivery, where we start to see a significant benefit from the back-end load of HDF and all the other initiatives. So look, I think what we were trying to do, we've been very explicit on trying to size the TDAPA piece because we recognize -- agree, it's great, always wonderful to have that benefit. But we also recognize how high a base it is giving in 2025. And our goal here is to maintain that high base in '26, regardless of the tail off of these issues -- I shouldn't call it issues, the TDAPA regulations. And we're investing in the future. So we've got this front-end loading for the training costs for HDF and we're investing in systems platforms that will also drive efficiencies in the future.

And our last question comes from James from Jefferies.

Two, if I can, please. And just first one, just a clarification. Can you confirm you said Corporate costs were EUR 200 million to EUR 220 million and intercompany were EUR 100 million for this year. I understand you're prioritizing your own clinics in Care Enablement, so we should see higher eliminations. But why such a large increase in Corporate costs? And is this a permanent step-up as part of your '28 growth outlook? And then I'll come back for a follow-up.

So on the intercompany profit elimination, yes, you're right. We called it out EUR 100 million, and it has to do with the prioritization of the rollout of high volume HDF and that is something on the Corporate line that is being eliminated. So confirming that.

On the Corporate cost, the EUR 200 million to EUR 220 million. I did call out that we have in the Corporate line, the IT platform investments that we included in the investment line that drives a year-over-year increase. That's why the assumption is higher. And in addition, you know that we have that FX impacts that we normally have from the gross charge out of the Corporate line and the global functions, and that is also contributing a low double-digit million in the increase year-over-year. So those 2 effects are explaining the year-over-year.

That's great. And then my follow-up question is, if you could just talk a little bit more about the number of missed treatments in the U.S. At least like the treatment numbers, I think they were lower by 150,000, which I know includes some divestments. And you talked about weather and flu, I think, in some of the comments earlier, but just wondering if you could comment on the perspective, this actually might be a structural headwind because we do understand if patients are entering dialysis, they're increasingly older perhaps kind of post COVID. Maybe they've got more co-morbidities, so they require more hospitalizations and they're missing treatments. And if so, like how can this trend reverse, which does seem to be key to unlocking the same market treatment growth if the funnel is slowing?

Yes. Look, we don't believe it's a structural issue. We do see elevated missed treatments, and we also see specific targeted initiatives that we are targeting that can help bring that down, whether that be the improving mortality, the hospitalization days, the kind of the things that we've talked about.

We do have kind of -- and if anybody has picked this up, but we do have 1 treatment day less in 2025 compared to 2024. That's just a function of how the end of year Christmas holidays and New Year in particular fell. So that's obviously playing into the '25 number. But we feel good about the work that we have ahead of us, and we have line of sight into all these initiatives that will help improve the outflows and kind of confident in that, that will turn to 2% plus same market treatment growth. And we'll start to see that progress as we obviously continue with HDF as well. Thank you for the question.

Thank you. Good. We do have no further questions in the call. So thank you for your patience. Thank you for your interest. Thank you for your good questions. And we'll see all of you or many of you on the road, I hope, in the next 2 months.

Yes. Thanks, everyone.

Thank you.

Great dialogue. Thank you. Bye-bye.

Ladies and gentlemen, the conference is now over. Thank you for choosing Chorus Call, and thank you for participating in the conference. You may now disconnect your lines. Goodbye.

Good morning, everybody. I'm David Adlington. I head up the med tech research group for JPM London.

It's my pleasure this morning to introduce Helen Giza, CEO of Fresenius Medical. There will be a Q&A afterwards. Thank you.

Thank you, David. Good morning, everybody. It's great to be back in San Francisco with you all. The JPMorgan Conference marks an important opportunity each year to reflect on progress as well as to look ahead, and I'm encouraged that the direction we have been setting continues to drive meaningful results.

Today, Fresenius Medical Care is stronger, more resilient and has set a very clear strategy to drive profitable growth and long-term value creation and has already embarked on this strategy. 2026 will be an important transition year on that journey with setting a new standard of care in the United States by starting the large-scale conversion of our clinics with a new therapy. I presented this a year ago at this conference, and today the execution is in full swing.

I won't read the safe harbor statement, you'll be glad to hear, but it applies here.

What gets lost in all the noise on the different topics is that the fundamentals of the kidney care industry remain intact, largely independent of the broader macroeconomic cycles. Structural drivers, including the aging population, chronic conditions like hypertension and diabetes globally, greater recognition of chronic kidney disease as a significant public health crisis continue to support the global demand for life-sustaining kidney replacement therapies. We continue to experience higher elevated mortality, especially here in the United States. However, once this normalizes, we see no reason why we would not return to historic growth levels.

There's also exciting advancements in pharmaceuticals as well as their availability, as well as new technologies enabling patients to live longer, healthier lives. The introduction of high-volume HDF therapy in the United States and the support from expansion in Value-Based Care will drive improved patient outcomes, lower mortality and patient outflow and will reduce missed treatments.

We are excited about the possibility of uptake in some new drugs such as GLP-1s. While they are not a cure for chronic kidney disease and only slow down kidney progression towards end-state renal disease by 6 to 7 months -- months, not years, as a reminder -- they do offer significant cardiovascular protection and reduce mortality in the CKD population. A recent study has also shown a significant benefit for dialysis patients. By using GLP-1s while on dialysis, a 23% improvement in mortality for patients has been seen.

As the need for kidney care continues to grow, the ability to deliver high-quality, innovative care at scale now matters more than ever. This is what sets Fresenius Medical Care apart. We lead kidney care through exceptional patient care and innovation.

We are uniquely positioned as a vertically integrated business with all 3 of our operating segments distinguished by market-leading positions and industry-defining assets. In Care Delivery, we are the global leading provider of kidney care services with over 290,000 patients and over 3,600 clinics around the world. In Value-Based Care, we manage the largest renal value-based care network with over $7 billion in medical costs under management, a network of 2,200-plus nephrologists and over 160,000 patient lives.

In Care Enablement, we have an industry-leading renal med tech portfolio with a diverse international footprint and commanding global market positions. One out of every 2 dialysis patients around the world uses our products. In the important in-center HD market, we have a 40% market share for in-center HD products. And in specific markets, we have a market share north of 80%. This reflects our commitment to both quality and innovation.

Individually, each of our operating segment is a market leader in its own right with compelling scale and market share. But the real value is unlocked when they come together. Care Delivery provides Care Enablement with direct insights into patient needs, which can then be efficiently incorporated into the product development cycle. New technologies can then be implemented by Care Delivery to enhance patient care and drive improved patient outcomes.

The importance of Value-Based Care, which meaningfully increases the uptake of best practices that improves patient outcomes, is a key strategic component and an important source of innovation in patient care. These outcomes directly benefit our patients through extending patient lifespan. They serve to increase the number of lifetime treatments per treatment and per patient, a key lever of growth.

I'm incredibly proud of our track record in execution and ability to deliver on the ambitious strategic commitments that we set for ourselves. Since 2022, we have seen a meaningful improvement in our operating performance. Our operating margin increased each year, from 7.9% at the end of 2022 to 10.3% through the first 9 months of 2025. This was supported by strong momentum in our FME25+ transformation program that should deliver EUR 790 million in sustainable savings in 2025.

We have not just executed, but we have accelerated and enhanced this program. You may remember that we initially targeted EUR 500 million in sustainable savings through 2025 and increased it to EUR 790 million. Through 2027, we have now targeted EUR 1.050 billion for this program, and I'm confident that we can go even faster here.

We have also been increasing shareholder returns. Our 2024 dividend payment was the highest in the company history and reflects a 13% growth CAGR since 2022. In June of last year, we announced an initial EUR 1 billion share buyback program over 2 years. We started in August of 2025 with the first tranche. By the end of December, we had successfully completed the first tranche, repurchasing 4.8% of total share capital for EUR 585 million buying back.

Our strong cash flow generation on the back of continued business momentum has enabled us to accelerate the initial EUR 1 billion share buyback from 2 years to less than 1 year, with the completion expected in May of this year. This demonstrates our consistent execution against our FME Reignite strategy with a focus on value creation for shareholders, in line with our new capital allocation framework.

In parallel, we continue to strengthen our financial profile. We have reduced our target net leverage ratio from -- band to 2.5x to 3x. And since 2022, we have meaningfully reduced our net leverage ratio from 3.4x to 2.6x at the end of the third quarter of 2025.

So while the early January timing of this conference means we have not yet published our Q4 results, there's still a lot to talk about for the first 9 months of 2025. I'm sure you can all appreciate it's this time of year where this year and last year can sometimes get confused. But at our Capital Markets Day in June, we officially launched our new strategy, FME Reignite.

As part of our FME Reignite, we carved out Value-Based Care as our third operating segment, recognizing the growth in that business to nearly EUR 2 billion in revenue and to further enhance our reporting transparency. As I mentioned earlier, we initiated the mentioned EUR 1 billion share buyback program, reflecting our strengthened financial profile and commitment to delivering shareholder value. And in a historical moment, we kicked off the soft launch of our 5008X rollout, introducing high-volume HDF therapy as the new standard of care for the United States.

We accelerated our FME25+ savings program with EUR 187 million in incremental savings through the first 9 months of 2025, putting us well on track to achieve the increased target of EUR 790 million in sustainable savings by the end of 2025. And this supported an improved operating performance with group margin increasing to 10.3% through the first 9 months of the year, driven by all 3 operating segments.

FME Reignite marks the start of a new chapter for Fresenius Medical Care as we transition beyond the phase of turnaround and transformation into a period of accelerated innovation and growth. The word reignite embodies how we will accelerate the realization of the potential of this iconic company. We will reignite kidney care. We will shape and define the future of kidney care.

Our strategy comes to life through 3 strategic elements. One, reignite the core by strengthening our core operations to improve performance. Two, reignite growth and innovation with a focus on profitable growth and bringing new innovative solutions to the market. And three, reignite our culture, to develop together and strengthen our culture.

These 3 strategic elements do not only enable us to lead kidney care into the future, but more importantly, also reignite value creation. This is our path forward designed to achieve our 2030 aspiration of reaching industry-leading mid-teen margins and reigniting value creation with enhancing returns for our shareholders. Our new dividend policy targets a 30% to 40% payout ratio, and we are already delivering on our commitment of a regular share buyback program.

But what matters now is how FME Reignite translates into execution. A lot is underway already, and I would like to share some highlights. At the group level, we will start investing in 2026 in IT platforms to enable the efficient execution of our FME Reignite strategy. And of course, there is the 5008X rollout strategy, which I will highlight in more detail later on.

For Care Delivery, we're advancing to industry-leading margins. This includes driving improvements to realized dialysis rates, and we are beginning to see benefits from our revenue cycle management initiatives. Volume growth and improving patient inflow and outflow within our control is a key focus. And one way we look to reduce patient outflow is by raising the bar on quality even higher, further enhancing clinical outcomes and patient safety.

These initiatives are gaining traction with encouraging early examples from the U.S., such as reducing controllable missed treatments by supporting patient treatment adherence and increasing antimicrobial interventions to reduce infection rates in patients with central venous catheters.

High-volume HDF will be another game changer in improving clinical outcomes and reducing patient outflow. For 2026, the 5008X rollout and major conversion of clinics means that Care Delivery will face in an initial transition period, and as a consequence, a more back-end loaded margin improvement towards 2030.

In Value-Based Care, we are taking responsibility for the integrated health care of our patients and creating mutual value through key quality and outcome initiatives. One example of this is Value-Based Care's strong results driving optimal starts for CKD patients transitioning to ESRD, with an optimal start rate of 2.5x the national average.

Overall for the segment, we are progressing on a path to profitable growth and an aspiration of a low single-digit margin by 2030. It's important to remember that revenue growth is largely a function of contract risk type and whether it increases or even decreases due to a change in contractual risk. That does not necessarily impact operating income contribution. While quarterly volatility remains a factor in this still nascent industry, we do expect more of a continuous margin improvement on an annual basis out to 2030 for Value-Based Care.

And in Care Enablement, we are focused on accelerating profitable growth towards a mid-teens margin aspiration, leveraging our strong global presence and market share. To enable robust growth and margin expansion, we are driving momentum in commercial excellence and operational efficiencies. We are also focused on driving innovation, and the 5008X is just one example of our innovation pipeline. For Care Enablement, we generally expect more of a continuous margin improvement.

HDF is not a new topic for me at JPMorgan, but the difference today is that we are not only talking about it, but we are in full swing with the launch of the 5008X machine in the United States. And HDF might be the best example today of how we leverage our vertically integrated business model to transform the standard of care.

This is incredibly exciting for FME as well as the entire industry, including patients, nephrologists and other providers. It is proven that high-volume HDF treatments result in improved mortality and quality of life for patients. The CONVINCE study demonstrated a 23% lower risk of death, with survival benefits emerging after only 3 months. This is great news for patients and also supportive of our own volumes and reducing patient outflow given the reduction in mortality as well as missed treatments.

The feedback from the first converted clinics is extremely encouraging and rewarding to hear. Patients report feeling significantly better with increased energy levels and improved sleep quality and reduced post-treatment recovery time. Clinic staff have highlighted the benefits of quieter, less stressful workflows, thanks to the enhanced automation of the machine, which supports more efficient and patient-focused care.

And as we look forward to significantly ramping up our launch, it's important to remember that we are executing this rollout from a position of strength already. In the United States, we have a 90% market share for in-center machines. Of the entire installed base of 160,000 machines, 145,000 are FME machines, including 56,000 in our own clinics. For the machines in external clinics, we have only a 66% consumable attachment rate today. And with the introduction of the new machine, we have an aspiration for that to grow to 100% by 2030.

For 2026 specifically, we expect production capacity of up to 15,000 machines available. In our own clinics, we are targeting to convert around 20% of our machines, with the ultimate goal of converting 100% by 2030.

I am confident in our ability to successfully execute this launch. However, this is the biggest transition of clinic infrastructure in the history of the company and it is important that we get it right early on. This is why we took a very controlled and measured approach with our soft launch in 2025, limiting it to a handful of clinics, which has provided us with valuable learnings and insights, allowing us to further enhance and refine the clinic training and conversion process.

In 2026, we are now targeting around 20% of the installed base in our clinics to be replaced with the 5008X. And although the replacement strategy for FME clinics is CapEx-light, the first year comes with an OpEx headwind for the rollout costs of a mid to high double-digit million euro, depending on the amount of speed of implementation.

This is why I'm calling 2026 a transition year. In 2026, we will train over 7,200 nurses and technicians and transition about 36,000 patients to the 5008X machine across 28 states. This requires significant training efforts, but we expect to improve efficiency as the rollout progresses.

We will also start to see operational efficiency benefits in converted clinics ramping up after conversion. Additionally, we can then start to transition eligible patients over a couple of weeks from HD to HDF to high-volume HDF therapy. And once they are 3 months on high-volume HDF therapy, the medical benefits of lower mortality will start to ramp up over the following 2.5 years.

In 2026, the positive effects will ramp up only towards the end of the year, hence, the benefits of 2026 rollout will be helping in 2027. And as we proceed with a significant transition in 2027, the efficiencies and improvements in mortality and utilization realized from the 2026 rollout will help mitigate associated costs in 2027. The year 2026 remains designated as our transition period within the broader multiyear infrastructure upgrade plan.

An important dimension of our business that is underestimated is the strength of our cash generation. Through 2030, we expect to deliver operating cash flow above EUR 2.5 billion annually. As mentioned before, in alignment with our FME strategy, we introduced a new capital allocation framework designed to reignite value creation by driving enhanced shareholder returns. This includes our updated dividend policy and the regular share buyback program.

Through September reporting, we are well on track to deliver our outlook for 2025. We expect to be at the very top end of our revenue growth range for 2025. We've also confirmed our operating income guidance of high-teens to high 20s percent growth, which reflects a meaningful step change in our earnings base. Through the first 9 months of the year, we were already at 18% earnings growth, and expect further acceleration in the fourth quarter.

In any business there's puts and takes, and in Care Delivery, reimbursement for phosphate binders has been a strong benefit supporting growth in that business in 2025. In Care Enablement, we are facing additional headwinds in China from modifications in tender requirements, along with delays in the tendering process.

And as you all know by now, we won't provide our outlook and assumptions for 2026 until our full year results on February 24. However, I do want to give you a sense of the additional moving pieces that we are considering for 2026.

As I just described, the 5008X launch is a major undertaking with OpEx headwinds, and 2026 will be more of a transition year for Care Delivery, with rollout costs of mid to high double-digit million euro depending on the speed of implementation. We are still unpacking underlying volume development through the end of '25, obviously tracking the current flu season, all of which will help inform our 2026 assumption.

Phosphate binders provided an unanticipated benefit of our pharma business in 2025. On our Q3 earnings call, we shared that this additional advantage to be about EUR 80 million, bringing the total benefit to EUR 180 million for the full year. We do not anticipate this additional EUR 80 million benefit to recur in 2026. However, the remaining EUR 100 million is expected to continue into 2026.

As previously communicated, we are assuming a headwind of around EUR 50 million from the expiration of ACA enhanced tax subsidies. And for our Care Enablement business in China, we are currently evaluating the consequences and potential impacts of the modifications in tender requirements for 2026, while further developing our strategic approach in that market.

At the same time, we plan to continue with full speed on our FME25+ savings program and are looking into further potential. Having accelerated by EUR 40 million in 2025 does not impact our EUR 150 million target for 2026.

At its core, Fresenius Medical Care is a highly cash-generative business. We have demonstrated strict financial discipline and a clear prioritization of shareholder returns while maintaining an investment-grade credit rating. We operate in a structurally growing market globally driven by a chronic disease with long-term demand.

What really sets Fresenius Medical Care apart is our vertically integrated business model with market-leading assets and strong competitive positioning across Care Delivery, Value-Based Care and Care Enablement. Innovation is embedded in our DNA, and we are on track to once again set a new standard of care with high-volume HDF in the United States, which creates meaningful benefits for patients and a tremendous opportunity for our business. All of this underpins a clear path to industry-leading profitability on our aspiration of a mid-teens margins profile by 2030.

While we have indicated that 2026 will be a necessary transition year as we scale up our 5008X rollout, our execution track record gives us confidence in our ability to deliver. Taken together, this is why we believe Fresenius Medical Care is clearly positioned to drive long-term value creation.

With that, I hand back to you, David, for questions.

Great. Thanks, Helen. So one of the discussions we've been having over several years now is just the volume impact on the industry. Obviously, we had the COVID impacts, and we've not really seen a recovery to pre-COVID levels. Both you and DaVita pointed towards an expectation at this conference last year and the year before of recovery. We still haven't seen it. I think the number of patients coming in has recovered, it's just you were seeing a higher level of mortality. I just wondered if there's any sort of further color around that and what might change that going forward.

Yes. Look -- am I -- you can hear me, right? Yes. Obviously, in the peak of COVID, we were hit with about 300 basis points of negative volume growth. And obviously, in the last few quarters, we are sitting here now with pretty much flat volume growth. And we're increasingly trying to put the narrative less about that net number, but really focusing on the inflows and the outflows, inflows being new patients coming in, outflows keeping patients on therapy or kind of reducing mortality.

And you're absolutely right, we don't have an inflow problem. We are seeing new patients coming in. What we have is an outflow problem. Mortality has still remained elevated post-COVID. And at the same time, we have an increasing missed treatments, not mistreatments, missed treatments phenomena happening with our patients.

So the work that we are doing, and we have clear line of sight into the work that we need to do in the operations that's really focused on reducing hospitalizations. We've got an increasing catheter usage in our patients. So work is focused on reducing catheter-related bloodstream infections, reducing hospitalizations. High engagement with patients to kind of reinforce that, while you think you might get away with coming 2 times a week instead of 3 on any given week, that is not good for your survival outcomes. So all that work is starting to take hold and pay dividends.

As you saw from the very first slide, we don't believe that the underlying fundamentals of this business are broken. We're actually encouraged by the uptake in the new class of drugs and the cardiovascular benefit that that provides. So I think it's just a question of time all the measures taking hold. And there's no reason for us to believe that we get back to the 2% plus that we saw pre-COVID. It's just been one of time.

And what's changed the dynamics in terms of the patients trying to reduce their number of visits to the clinic?

Yes. As you can appreciate, we have the world's largest renal database, we have a lot of information and data on our patients. And we have been constantly trying to unpack that, what's happening. When we look at our data, what we are seeing is those patients who have been on dialysis for longer and maybe survived the COVID period, somehow in COVID, many of those patients learned that while optimal treatment is 3 times a week, every week, we are seeing them skip treatments every now and again.

Obviously, that is part of the reason likely for the elevated mortality. Obviously, mortality is still elevated from the severe flu season that we saw in Q2 last year. But people can miss treatments from a whole host of reasons. Some of those haven't changed, David, as you know, over the years, whether that be transportation, they don't feel well, they just don't feel like coming.

So what we're learning is that this has to be one on the local ground, clinic by clinic. And the intimate patient knowledge that a clinic manager has of the patients that are scheduled in the clinic, we need to be on top of those patients' treatment behaviors right away. If somebody is missing a treatment today, we need to be calling them today. We need to get them rescheduled for tomorrow.

So we, through the Care Delivery kind of fixing of many things that needed to be fixing, we're also realigning that structure within the clinic manager process as well. So we're chipping away at a clinic by clinic, patient by patient, but it is definitely a changing paradigm since COVID.

Okay. Perfect. And then you mentioned flu there. Obviously, it's a strange season last year, it was very late. This year it's early.

Right. I know. Since I've been here, in 6 years, I don't think I've had 2 flu seasons in the same year. So this one is a first. Obviously, in 2025, we saw flu season start in February and go through February, March and April. And now we've got flu season starting in December.

What I was encouraged by, and I gave that narrative on the Q3 call, was with the current kind of narrative or rhetoric from the U.S. government on vaccinations, I was honestly concerned that our vaccination levels were going to be lower. Obviously, we have a very vulnerable patient population, so them not getting vaccinated is a problem. I was really encouraged by -- on Q3, that we saw the vaccination numbers high, like in the mid-70s, by Q3. That has continued through December. We see now a similar level of vaccinations in our patients by December.

What I can also see is a higher number of missed treatments in December. What I can't do yet, until I get the 6 to 8-week data lag that we have on mortality, is what impact that really had on patients and whether it was just a missed treatment or did it add to mortality. I don't know how much more color we have on that by the time we get to earnings on February 24. But obviously, we're tracking the season closely.

Okay. Perfect. And then one of the other things you actually called out in the slides, which is helpful, in terms of the change in ACA subsidies and what sort of headwinds they might present this year, there's a lot of uncertainty around what might actually happen there. But as we stand today, they've gone. Has that actually impacted patient behavior already?

Yes. I mean, gosh, you're going to change those subsidies right in the middle of open enrollment and it's -- it couldn't have -- all that narrative couldn't have happened at a worse time in the -- kind of in the insurance system. So we are assuming that the subsidies are gone. While it's still in the Senate, we're not hopeful that that is going to pass. So we're assuming it's gone.

What is going to be really difficult is all of these patients through the open enrollment period at the end of last year had to make a choice. And what we don't know yet are those patients who are already in an exchange, did they stay in exchange hoping a subsidy might come through? Or did they make a shift so that they could be in control of what their outcomes were for insurance?

We know our patient population likes to be insured. And we've seen that all through COVID, they're sticky. So we have made an assumption of where we think those patients will go in line with our current patient mix. Enrollment is still open for the exchanges, believe it or not, until January 15. We won't know what happens till it closes. And there's a further wrinkle that until they pay their first premium or first month of premium, they won't actually get coverage. So we really won't know what's going to happen here, I'm thinking, until end of Q1, of where we really see how our patient mix kind of shook out.

So yes, it's a nice one to try and predict. But I think we're holding to our assumption of around a EUR 50 million headwind. We'll see once we get the open enrollment numbers.

Perfect. And then one of the tailwinds you had in recent years is that shift to Medicare Advantage as well.

Yes.

How are you feeling about that? Is it a bit further than you expected originally?

Don't quote me.

But do you see that plateauing here? Or is there a risk that actually moves the other way?

Yes. I'm smiling because with the Cures Act in '21, we were sitting about 16% or 17% of MA. And if you remember, David, I was like, there's no reason to believe that this MA book business can't get to 35% in 3 to 5 years. And yes, we were there, what, in 2 years? Yes.

So now we're sitting with a Medicare Advantage book of business that's mid-40s. I -- from what we can see, it looks like that will hold. We're not expecting any major changes up or down. We feel pretty good about the stickiness of that MA book of business. But again, it will be interesting to see if the exchange shakeout has any implication on that too. But we're feeling good about the mid-40s.

Perfect. And then obviously, a lot of focus in this presentation and through last year on HDF.

My favorite topic.

Obviously, it's been approved in Europe for a long time.

Yes.

It's taken a lot -- unusually, it's taken longer to come to the U.S. Maybe you could just, for the people in the room, remind us why that is the case.

Yes. Am I allowed to say, before my time? Yes. No, look, you're right, this technology has been available in Europe for a decade. In Europe, about 75% of the patients are on HDF therapy. And the mortality levels in Europe are around 12%. The CONVINCE study shows that HDF moves mortality by 23%, which directly translate to mortality in the U.S. being around 17%. So we can all see the benefits.

Look, I think this machine when it was kind of maybe first available for the U.S., was pre-COVID, where volumes weren't an issue, where nobody, I can say before my time, nobody felt like they needed to buy a new, more expensive machine, or incur significant cost for training on that new machine. Obviously, that was before the CONVINCE study.

So when we think about innovation and connecting the dots on innovation and outcomes for patients, clearly, it all came together at a perfect time. When I was reevaluating the portfolio, I'd say I inherited when I became CEO, and it was very -- it was clear that this was a significant opportunity for us. So obviously, the CONVINCE study and the FDA approval all at the same time and then really shaping the future strategy for this has all happened in the last, I guess, last 2 years.

And you mentioned there that last year you've had a relatively conservative rollout and you wanted to learn a lot of things about that rollout. What were the key learnings that you took away?

Yes. Look, we got approval from the FDA for the base guts of the machine, for want of a better word, in May of last year. We also knew that we had this opportunity to upgrade the connectivity on the system side. And rather than rolling it out and then upgrading later, we did make the conscious decision to roll out the version 2.0, if you will, later in the year.

We have not had any innovation in this industry in 40 years. This is, as I mentioned in my comments, this will be a significant undertaking, and we wanted to make sure that while it's a similar machine to Europe, it's not exactly the same. It is U.S. specific. And we wanted to make sure that we could iron out any kinks that might exist sooner rather than later. So we have -- our learnings are kind of getting used to the machine, the training. I mean it's not just a new machine, it's new consumables that are integrated. And then making sure that we could track and see the patient experience and the benefits.

So it was deliberate on our part to get it right. As you know, we also plan to sell this to other third-party providers. We want to be the testing ground for that before we sell it. But in all honesty, it's been incredible. I mean the color that I mentioned in my comments from our patients is real. I mean if you and I are sitting in 2 dialysis chairs and you're on HDF and I'm not, I am saying, "I want what you're having." It's very, very visible benefit. So we're all systems go. I mean we have -- we soft-launched last year with a handful of clinics. As you say, we've got about, whatever, I think just under 12,000 teams, and we're off, off and running.

We also have to minimize disruption, right? So we wanted to make sure we weren't doing too much too soon. And if something did go wrong, and touch wood it doesn't, that we didn't have kind of massive disruption. I know what that felt like in the summer of '22. We won't go through that again in this company's history.

And is the plan to convert an entire clinic to the new machines that's...

Yes, exactly. So we've been very targeted in the strategy of the launch plan. We've got 2,600 clinics in the U.S. We are stratifying them by the clinics that are performing well, that they're growing, that they have a high degree of commercial mix. Ideally, they already have an almost fully depreciated current installed base. And then obviously, if we have an opportunity to gain market share in that particular area, that's our sweet spot.

So we won't go region by region, we won't go state by state. We will absolutely go clinic by clinic based on that criteria. And that's why we're in Massachusetts, we're in Florida, we're in Minnesota. We are going top clinic to bottom clinic.

Perfect. And do you have evidence that it's actually being used as a way of gaining patients for those clinics?

Maybe too early to tell, but we expect that to be the case. Once we've got a clinic fully operational on this -- big part of the strategy has been the nephrologists' engagements, making sure that they are supportive so that they can refer the patients. And if I'm a nephrologist who is all in on HDF, our belief they will refer to us versus a clinic that doesn't have it.

Okay. And so at what point do you switch supplying only your own clinics to -- there will hopefully be some decent demand from some of your competitor clinics.

Indeed. And there's definitely -- Katarzyna is retired now, but Katarzyna would tell you demand isn't our problem. So obviously, the advantage of being vertically integrated is I want to maximize my first mover advantage and I want to get it in my clinics first. We have production capacity for about 15,000 machines a year; we will plan to do about 20% a year in our own clinics. And then the excess that is created through production and our own demand will be allocated to the other providers. And the other providers are welcome to place their purchase orders.

Perfect. I'm afraid we're out of time, but thank you very much.

Thank you. Thanks, everybody.

Ladies and gentlemen, welcome to the report on the Third Quarter 2025 Conference Call. I am Sandra, the Chorus Call operator. [Operator Instructions] The conference is being recorded. The presentation will be followed by a Q&A session. [Operator Instructions] At this time, it's my pleasure to hand over to Dr. Dominik Heger. Please go ahead, sir.

Thank you, Sandra. Welcome, everyone, to our earnings call for the third quarter 2025. As always, I start out the call by mentioning our cautionary language that is in our safe harbor statement as well as in our presentation and in all the materials that we have distributed earlier today. For further details concerning risks and uncertainties, please refer to these documents and to our SEC filings.

We will have roughly 1 hour for the call. In order to give everyone the chance to ask questions, we would limit the number of questions to two. Thank you for making this work. As always, let me now welcome Helen Giza, CEO and Chair of the Management Board; and Martin Fischer, our Chief Financial Officer. Helen, the floor is yours.

Thank you, Dominik. I'd also like to extend a warm welcome to everyone on the call. Thank you for taking the time to join us today and your continued interest in Fresenius Medical Care. As many of you know, the U.S. is in government shutdown since the 1st of October, and many health care policy decisions are open, like the questions of extended tax subsidies for the exchanges and whether they will expire by the end of this year or the publication of final 2026 ESRD PPS rule. This requires us to remain flexible in planning and agile in running our business.

We remain focused on what we can influence. In Q3, we made meaningful progress in advancing our FME Reignite strategy and positioning ourselves for sustained value creation. Our strong third quarter results reflect continued momentum and disciplined execution as we further accelerated top line growth while delivering a clear step-up in earnings growth and profitability. The step-up is in line with our full year planning. I will begin my prepared remarks on Slide 4.

In the third quarter, we realized strong organic revenue growth of 10%, with positive contributions from all 3 operating segments. In the U.S., same market treatment growth was slightly positive. This is in line with our assumption of flat to slightly positive growth for 2025. Operating income growth increased for a third consecutive quarter and accelerated to 28%.

As a result, this drove a step change in profitability with our operating income margin expanding from 9.9% to 11.7%. The improvement in profitability was supported by continued momentum in our FME25+ program, which generated a further EUR 47 million in sustainable savings in the quarter. This brings us already to EUR 174 million of savings for 2025. As part of our new FME Reignite strategy and capital allocation framework, we announced an initial share buyback of EUR 1 billion, in line with our commitment to reignite value creation for shareholders.

The share buyback program officially commenced in August with a first tranche of up to EUR 600 million. Through 30th of September, 3.6 million shares had been repurchased for a total investment amount of EUR 151 million, and until October 31, we have repurchased in total 4.35 million shares for a total investment of EUR 188 million. For full year 2025, we are very well on track to achieve our outlook for the year and therefore reiterate our guidance.

Next, on Slide 5. The American Society of Nephrology's Kidney Week takes place in Houston this week. Already last year, we saw a lot of interest in high-volume HDF and our 5008X machine at the ASN. I do expect a high level of interest and engagement again this year, especially as we start the 5008X rollout. And with that, a new therapy becomes available in the United States. This will set a new standard of care. We submitted around a dozen of clinical abstracts that are specifically focused on high-volume HDF. From the risk reduction resulting from HDF therapy to the implementation of HDF in clinics to AI support for clinicians during implementation.

Besides the scientific side of HDF, it's also great to see how the feedback is from nephrologists that visited one of our clinics that are already run with HDF, and I want to share what they said. Being able to see the human experience of HVHDF firsthand was one of the most pivotal moments for me and given our mission and the potential of the HVHDF therapy, we would love to explore having our clinics serve as index centers for the North American rollout of this modality.

This shows that we are not only excited about the broad rollout in '26, but how well prepared we are in all dimensions and how well received it might be. Next on Slide 6. With the launch of the FME Reignite strategy, we have committed to reignite growth and innovation across our organization. In care delivery, we are supporting overall volume growth by raising the bar on quality even higher, further enhancing clinical outcomes and patient safety. This is especially important to me because it directly reflects our purpose-driven patient-centric approach where the patient is at the heart of everything we do.

We are already seeing encouraging progress on our quality and safety initiatives, and I would like to share some examples from the U.S. market. Treatment adherence is a key focus as patients with chronic illnesses often struggle to adhere to their care plans. This frequently involves helping our patients to understand the importance of sticking to their treatment plan and working with them to remove barriers. Since the beginning of this year, controllable missed treatments have decreased due to improved alignment amongst physicians, patients and clinicians.

Many ESRD patients begin dialysis with a central venous catheter, which while necessary, poses a high infection risk. Although our long-term goal is to transition patients to permanent access, bloodstream infection prevention remains even more critical during this period. Antimicrobial interventions reduce infection rates by 70% compared to conventional care.

In August, we launched a program to further increase antimicrobial catheter treatments to eligible patients. Adoption to date has been strong with 84% of eligible catheter patients now receiving bloodstream infection protection, and we are on track to achieve even greater utilization.

Protection against the flu is especially critical for our vulnerable patient population. And because flu strains change yearly, annual vaccination is necessary to maintain protection. Our U.S. clinic network has launched its annual vaccination campaign and vaccination rates are 34% higher than where they were at this point in 2024. We already have more than 72% of our patients vaccinated. And like in previous years, we expect to come to 85% before the end of the year.

These are just a few examples of reducing hospitalization and costs for the health care system and at the same time, increasing the number of treatments, while improving patient outcomes and reducing mortality over time. I'm extremely proud of the work we are doing and the results we are already achieving. It gives me great confidence and excitement for the path ahead.

Turning to Slide 7. This quarter, we saw strong execution across all 3 of our operating segments. I will take you through some of the key highlights by segment. In care delivery, in line with our expectations, U.S. same-market treatment growth was slightly positive with 0.1%. This reflected the carryover effect from elevated mortality, which was driven by the severe flu season earlier in the year and positively offset by improving admissions as well as slight improvements in missed treatments.

In our international markets, same market treatment growth increased to 1.2%. Third quarter care delivery performance benefited from favorable rate and mix development in the U.S. as well as accelerated contributions from phosphate binders in our pharma business. We further executed on our portfolio optimization plan, closing clinic divestitures in Brazil, Malaysia and some other smaller markets. One highlight from me in care delivery, which I'm sure it comes as no surprise, is the availability of high-volume HDF treatments in select U.S. Clinics. We are progressing every day and are very encouraged by the initial feedback we have heard from our patients that have been receiving HDF treatments.

The work we are doing is paying off, and I'm very proud of the team's focus and execution while never wavering on the highest quality of patient care. These patients report feeling significantly better with increased energy levels and improved sleep quality and reduced post-treatment recovery time. Clinic staff have highlighted the benefits of quieter, less stressful workflows, thanks to the enhanced automation of the machine, which supports more efficient and patient-focused care. The excitement is palpable.

While we are not expecting this to be a major driver of operational performance this year, our learnings are rapid from the early rollout of select clinics, which is providing valuable insights allowing us to further enhance and refine the clinic training and conversion process. This will set us up for a seamless large-scale launch in 2026, which will be the start of the broad transition of our clinic network.

Turning to Value-Based Care. As expected, we continue to face a degree of earnings fluctuations. We are also facing delays to 2026 by CMS in providing reporting data for the CKCC program, which adds to these fluctuations as these cannot be planned. In Value-Based Care, we realized a higher number of member months due to continued contracting growth as well as a growing network of providers, and we are further enhancing our care models through increased use of artificial intelligence.

As part of our Reignite Strategy, we took an important step forward by increasing and strengthening our ownership stake in our Value-Based Care asset Interwell Health. This reinforces our leadership position in renal Value-Based Care, which is supported by the vertical integration benefits for our business model offers.

With this step, we are better able to leverage the full scale and size that Fresenius Medical Care as a total company offers. This and the underlying progress we are already making in Value-Based Care is positioning this business for long term, more profitable growth. Care Enablement delivered another strong quarter, supported by volume growth and positive pricing momentum overall.

We continued to capture sustainable savings as part of FME25+, driven by disciplined execution of the next level of footprint optimization across both manufacturing and supply chain. And as a result, our Care Enablement margin further progressed compared to the prior year despite being increasingly challenged by transactional exchange rate impact.

I will now hand over to Martin to take you through the financial performance in more detail.

Thank you, Helen, and welcome to everyone on the call also from my side. I will pick up on Slide 9. In the third quarter, we achieved organic revenue growth of 10%, with all 3 segments contributing to this strong performance. At constant currency, revenue increased by 8%. We continue to divest assets as part of our portfolio optimization plan. Divestitures negatively impacted revenue development by 60 basis points. Operating income, excluding special items, increased by 28% on a constant currency basis. This significant increase led to a clear step change in the group margin to 11.7%, well into the implied range of 11% to 12% for 2025.

Special items negatively affected operating income by around EUR 100 million. This comprises costs relating to FME25+ and our continued portfolio optimization as well as effects from the remeasurement of our investment in Humacyte. Next, on Slide 10. This slide breaks down the significant 180 basis points margin improvement. All 3 segments contributed to the positive margin development with an especially strong contribution from Care Delivery. Net Corporate costs developed favorably by EUR 19 million. This was primarily driven by virtual power purchase agreements with around EUR 20 million and Corporate costs broadly stable otherwise.

Foreign exchange rates developed unfavorably with a negative EUR 24 million translational impact. The average U.S. dollar exchange rate in quarter 3 was 1.17 compared to 1.13 in the second quarter. I will now walk you through the financial developments in each segment, starting with Care Delivery on Page 11. Care Delivery realized organic revenue growth of 6%, supported by both Care Delivery U.S. and International. In the U.S., organic growth of 6% was driven by favorable rate and payer mix development. Positive contributions from phosphate binders as well as reduced implicit price concessions, which demonstrate our progress on active revenue cycle management.

Internationally, we realized strong organic growth of 4%, including 1.2% same market treatment growth. The continued execution of our portfolio optimization plan negatively impacted Care Delivery revenue development by 120 basis points. Care Delivery significantly improved profitability in the third quarter with a margin of 14.5%, it is at the upper end of our 2025 target margin band. While we still saw muted same market treatment growth, the business growth was supported by positive rate and mix effects and additional higher contributions by phosphate binders in our pharma business. These factors compensated for the missing income from the consent agreement on pharmaceuticals, which we had in the third quarter of last year.

The phasing is different this year, and we do expect this to come in the fourth quarter, but at a lower level. Higher sustainable savings through FME25+ helped to partially compensate for higher labor costs, including elevated medical benefit costs. The unfavorable development of exchange rates also had a sizable negative impact on operating income.

Let us move to Slide 12 to review the development in Value-Based Care. Value-Based Care further accelerated revenue growth, realizing 42% organic growth. This significant increase was driven by a high number of member months, mainly due to continued contracting growth. The higher growth in Value-Based Care is also driven by gross revenue recognition instead of net revenue recognition of a major contract. This change does not result in additional earnings growth.

Operating income in Value-Based Care amounted to a loss of EUR 21 million compared to a loss of EUR 37 million in the prior year. This reflects the quarterly earnings fluctuations that are inherent to this business model. As mentioned by Helen, we are also facing delays to 2026 by CMS in providing reporting data for the CKCC program, leading to a delayed revenue recognition. Due to this shift, we assume a slightly more negative operating income contribution from the Value-Based Care segment. I will provide an overview of the financial performance in our Care Enablement segment on Slide 13.

The Care Enablement realized strong revenue and organic growth of 5%. Revenue development was driven by solid volume growth and continued positive price momentum. Care Enablement achieved a 38% increase in operating income, leading to a margin increase of 200 basis points to 7.6%, in line with our expected phasing for the year. Business growth was, as mentioned, driven by volumes and pricing, which was partially offset by higher-than-expected and increasing currency transaction losses. Further sustainable savings from the FME25+ program compensated for the expected inflationary cost increases.

Moving to Slide 14. Due to the cash flow disruptions from the Change Healthcare cyber incident in 2024, it is more useful to assess cash flow development on a 9-month basis. We have realized strong cash flow development through the first 9 months of the year, with operating cash flow increasing 8% year-to-date. In the third quarter, operating cash flow declined compared to an inflated prior year base that benefited from around EUR 400 million in catch-up reimbursement following the Change Healthcare cyber incident.

The negative year-over-year effect was partially offset by favorable working capital developments in this quarter. Our disciplined use of cash reflects the priorities set out in our new capital allocation framework, which is designed to reignite value creation. We reduced our net debt and lease liabilities compared to the prior year period. As highlighted by Helen, our share buyback program is well underway.

By the end of September, we repurchased 3.6 million shares or 1.2% of our share capital with an investment volume of EUR 151 million. In addition, we invested EUR 312 million in the third quarter to strengthen the ownership in our Value-Based Care asset Interwell Health. This is reflected in financing cash flow. In parallel, we ended the quarter with a further strengthened net leverage ratio of 2.6x, well within our target range of 2.5 to 3x.

I will now hand back to Helen to review our outlook.

Thank you, Martin. I will finish my prepared remarks on Slide 16. The strong growth in our Value-Based Care segment due to the type of revenue recognition of one contract results in stronger-than-expected revenue growth in this segment. Therefore, we expect to be at the very top end of our low single-digit percent revenue growth range for 2025. As explained, this growth in Value-Based Care driven purely by contract type related revenue recognition does not drive additional operating income growth.

Looking at operating income growth for the group. We have shown continued progress through the first 9 months with an expected acceleration in the third quarter. This brings us to 18% operating income growth in the first 9 months. We are not only in our target range of high teens to high 20s percent operating income growth already, but also demonstrate with 11.7% a new and improved level of profitability despite a challenging environment and very low same-market treatment growth in the U.S. When I look at the big picture for 2025, we are confident in our continued improvement of our underlying business. With 9 months under our belt, we would like to update you on our latest thinking for the operating income development for the year.

The positive momentum in FME25+ will deliver around EUR 40 million more, delivering around EUR 220 million full year, helping us to directly offset the increasing medical benefit costs. The acceleration in the third quarter of our pharma business contributions from phosphate binders is now estimated to be around EUR 80 million higher than the assumed EUR 100 million. This is helping to offset the full year headwind from lower volumes in the U.S. and the increased foreign exchange transaction headwinds.

As always, the fourth quarter is our strongest quarter. We do expect further acceleration in earnings growth and margin expansion. With all that I just outlined above and our 18% operating income growth in the first 9 months, we are not only already above the bottom end of the range, but we are confident in confirming our full operating income guidance range for 2025. As we approach year-end, I know many of you will want further insight into our outlook and assumptions for 2026.

To manage expectations here, we are currently in our planning process for 2026. And I'm sure you can all appreciate that there are several moving pieces. In addition to the normal headwinds and tailwinds we navigate any given year, we also need to see how mix evolves for phosphate binders and to what extent price erosion will impact our pharma business. What happens to extended ACA tax subsidies, the final CMS pricing for '26 as well as the potential impact of new tariffs and pharmaceuticals pricing. We acknowledge the key KPI is next year's same market treatment growth. Our Q4 volume data will clarify trends in mortality, referrals and overall volume, shaping next year's outlook. Just like every year, we will share our 2026 outlook along with our full year results in February.

With that, I'll hand this back to Dominik to start the Q&A.

Thank you, Helen. Thank you, Martin, for the presentation and the updates. Before I hand over to the Q&A, I would like to remind everyone to limit the questions to 2. If we have time over, we can go another round.

With that, I hand it over to Sandra to open the Q&A, please.

[Operator Instructions]

Our first question comes from Oliver Metzger from ODDO BHF.

First is on your guidance on the margin guidance. So in your slides, you showed that the Care Delivery already stands at the top end of your expectations. And having said this, do you see the stronger progression in Q4 coming over relatively spoken from Care Enablement? Or do you expect due to the timing of payments, a step-up in Value-Based Care.

Second question is on the treatment adherence. So technically, beneath mortality, it's definitely one of the areas where you're not where you want to be. Do you see -- because COVID is already 5 to 6 years or 5 years ago. And you see that you commented that the patients who were -- patients during COVID have a lower adherence than the patients who you recruited afterwards. So do you still this normalization in form of over time patients just passing away due to the normal mortality? Or do you see that there's still some other reasons why this level is elevated?

Look, on your first question regarding guidance, we do expect to see continuous improvement in all segments, but we also see strong support from Care Delivery. On your second question, I'll make sure I unpack all those pieces in there. In terms of -- I think you started with treatment adherence and also kind of wrapped up in their reasons for mortality. There's no question, our mortality levels are still elevated. But where we're focusing on things that we can control are seeing an improvement in missed treatment. Obviously, those areas that we can control, if we can make sure our patients continue to get their treatments, that obviously helps with treatment volume and we are seeing those improvements in referrals. So obviously, we work hard on those missed treatments because that has a double effect on improving the number of treatments, but also ultimately, if the patients keep getting their treatments should help with mortality as well.

And as you saw from one of my opening slides, we're also working on our catheter rates kind of coming down as well. So all of that should help mortality just tied up with our general strategy of the focus on patient quality and patient safety. In terms of your comment on the passing away, maybe reason code. I don't know that we can tease out that if anything different. I mean there was a time in COVID that you could kind of get the COVID piece. And if you remember, we used to report that as excess mortality. Now we just pass it all as the general mortality, and there's nothing in those trends or that data that is telling us it's anything new or different. It's just that it continues to stay -- it continues to be elevated.

I was referring towards the patients who were already on dialysis during COVID that they have a higher average number of missed treatments compared to the patients who came to dialysis afterwards.

Yes, that would have been the case because they were already kind of vulnerable and those that were with us during COVID would have had more missed treatments than that we see in maybe new patients coming in. Sorry, I misunderstood that direct question on COVID.

The next question comes from Veronika from Citibank.

And hopefully, you can hear me okay. I have 2, please. One, I just want to go back, Helen, to your comment on phosphate binders, apologies. There's a lot of numbers, and I probably misunderstood it, but I just want to confirm that you are now expecting EUR 180 million of benefit from phosphate binders this year versus the EUR 100 million that was assumed in the guidance previously? And I guess just to play a little bit of devil's advocate. If I strip that EUR 180 million out of the Care Delivery margin trajectory, obviously I don't know exactly how much you booked in the 3 quarters of the year versus the full year, but it doesn't seem like there is a huge amount of margin improvement underlying in the business.

Tell me if I'm doing that math wrong, I did it very quickly on the slide, but I just kind of would love to understand what you're seeing margin-wise, if you strip out the phosphate binders. And then my second question is just looking to 2026, and Medicare Advantage trends in particular, we are seeing some early signs of reduced enrollment. I'm curious how you're thinking about mix as we head into next year from a Medicare Advantage perspective. And to what extent we should be thinking about this maybe no longer being a tailwind to the business into next year?

Yes. Thanks, Veronica. I think I can tackle both of those. Sorry, I may have stumbled, as I was saying, the phosphate binders number. There was EUR 80 million and EUR 100 million adding up to EUR 180 million. So my apologies if everyone didn't catch that on the call, you're right. We are now seeing that full year number to be EUR 180 million versus the original guide of EUR 100 million through Q2. We are seeing favorability in our pharma business, and Q3 was particularly strong with that uptake.

The FKC side of the house or the piece that we see in the clinics is developing in line with expectations, but we are seeing more favorable pharma and are now expecting that trend to continue that we saw in Q3 into Q4. Obviously, that's something that we are kind of trying to get our arms around for 2026 as well as we think about utilization and pricing for the binders while it's still under the TDAPA period, but it is in line kind of with what we saw in Q3.

Look, I would say on your broader question and why I thought it was important to bucket the moving parts, yes. I mean, I can pick the favorability from binders. I can pick the favorability from FME25, but it shouldn't be lost that we are -- while we do have this softer volume, we are having to overcome the lost margin from our original assumptions on volume as well as the underlying transactional exchange that we are seeing. So -- and the medical costs that are driving the labor cost higher in terms of increased utilization of our employee benefit claims as well as the volume of claims.

So as you can appreciate, we're juggling a big business here. We're trying to keep balancing the pluses and minuses, but there are some underlying negatives that these positives are helping us offset that are all coming through in the year. In terms of your Medicare Advantage question, it's an interesting one because we also started to pick up headlines from the big payers that they were backing off some of the coverage of MA plans.

What we have seen through Q3 and projecting into Q4 is actually no change in that MA mix and that book of business. And actually, it continues to grow episode slightly and is quite sticky. What we are seeing in the market is while some of the big payers might be backing off some plans. It is more of the consolidation of MA plans and the overall enrollment numbers are looking consistent. And that's actually come from the government as well. So we see quite a steady mix as well as similar number on enrollment, but there is consolidation of the number of plans out there that payers are doing at a more local level. So right now, our current assumption is that we wouldn't see a big impact in MA.

Just -- maybe just to kind of put a finer point on the mix and things that we are watching of course, the ACA exchange, whether that does conclude at the end of the year or whether there will be some deals on extending that. So that is the piece that we are watching closely on where those patients may end up during the current open enrollment period, which started, I think, at the weekend. So we'll continue to navigate that. But overall, looking quite steady here on MA.

The next question comes from Hassan from Barclays.

A couple from me, please. Firstly, on EBIT guidance range remains pretty wide as we move into Q4. What is driving the risks here to your mind? And why is the bottom end of the range, not more likely? And what was the phosphate binder benefit in the third quarter, please? Secondly, on treatment growth, can you talk a bit about admissions and missed treatments as you moved through the year? And how you see Q4 growth given the flu impact was obviously quite meaningful in the first half at 60 basis points. I appreciate that you don't have the Q4 detail, but how do you consider the moving parts as you move into 2026 and the confidence around the 2% plus treatment growth that you've previously talked about?

Thanks, Hassan. I'll tackle some of that and maybe, Martin, you can take the phosphate binder Q3 question. But let me unpack what I can and then pass you over to Martin. Yes, look, the EBIT guidance, we always knew that the EBIT range is wide because of the implied margin range that's there as well. As you heard from my commentary, and you can see in the numbers, we're already at the bottom end and we've left the range wide open, which I think you all know me by now. That tells you that I do think that there are opportunities for that top end to also be in play.

As you can appreciate, a slightly bigger number on FME25, slightly less impact from exchange, those numbers can move the needle kind of around that range. So you know I don't shoot for the bottom end. We are still excited about the underlying growth, the momentum we're seeing, and that's why I've left the range wide open. On treatment growth, you know I've been trying to put a lot more color on inflows and outflows rather than orienting around the net number because there's a lot happening there.

Over the course of the year, we have seen improving admissions. If I look at it versus Q3 this year versus Q3 last year, they are improving and 9 months over 9 months is improving. Mortality is down, but still elevated. And missed treatment, we are chipping away at and making improvements. I think the commentary you've seen from the industry is they have been higher, but we are really excited about the work that we've been investing in, taking hold. So that missed treatment number is improving as well, along with all the patient safety and patient quality work we're doing. So we're excited about that.

[indiscernible], I didn't touch there. On your flu. Obviously, we did have a severe flu season in the first part of this year. And you're right. You remember that number correctly, 60 basis points impact. We will have to see how the flu season kind of develops, obviously, in Q4. I'm excited about, as you can probably tell, and encouraged by the high level of vaccinations. That's great despite the narrative maybe catching the headlines in the U.S. Our patients are taking good care of themselves. And we are taking good care of them. So we'll see how that develops. But obviously, that's a year-over-year depending on how we see -- how severe a flu season. If it is a severe flu season is going into next year, which the -- kind of the other question that you have on the 2%.

We're still confident in that 2% once we see mortality normalize. And as we know, mortality is still elevated. And of course, we're in slightly positive territory currently. So the funnel improving obviously helps all the work we're doing on outflows obviously helps. And once that mortality level normalizes, we have no reason to believe we don't get back to 2%. And obviously, we'll give our best stab on that once we kind of finalize our outlook for 2026.

And don't forget, I mean, I know it's -- we're kind of in the early stages of HDF, but our expectation as HDF continues to get traction over the course of 2026 that will also help with kind of mortality, missed treatments, et cetera. So there's a lot in your question. Hopefully, I covered all my pieces.

And Martin, do you want to just take that Q3 phosphate binder question?

Hassan. Let's take the phosphate binder. As Helen outlined, we did see a pickup in the third quarter against the second quarter in our pharma business, whereas the clinic business assumptions are coming in broadly as expected. For the third quarter, the total effect of phosphate binders was a mid-double-digit million amount and to underpin the EUR 180 million that Helen mentioned, we are also assuming a similar dynamic on the pharma side in the fourth quarter, a similar amount in the fourth quarter as well.

Next question comes from Hugo from BNP.

A quick one on FME25, which you upside. Can you maybe point to the reasons for that? Is that production move to Mexico that's finally kicking in or any other things? And second, on the rollout of HVHDF, can you maybe share the number of clinics? Sorry if I missed that. And compared to your plan presented at the Capital Markets Day, given the early learnings that you have from the rollout. Does it change anything in your plan from 2026 in terms of how fast you think you will be able to deploy that instrument?

Martin, do you want to take the FME25 question, I'll pick up with HDF?

Yes. Sure. So as you saw in the third quarter, we had strong momentum and we are already after 9 months almost at the full year original guide that we had for FME25+. And that momentum is continuing. And as Helen outlined, we are pushing to further accelerate our efforts. That is true for Care Enablement, where this also helps us to offset some of the inflation and FX transaction headwinds that we have, but it's also true for the global functions as well as for Care Delivery. So we are making good progress, and we are leveraging that momentum, hence, the upgrade of around EUR 40 million that Helen articulated.

Thanks, Martin. And then Hugo, on HDF, as you can all appreciate, we are in the early rollout, and we are adding it to a very small number of clinics, and we're adding them as we go. In fact, we added 2 more just last week that continues to gain momentum, and we are progressing every day with our kind of installations, training, learnings, getting patients, not just on the new machine, but maybe more importantly on the HDF machine. So that will continue through the rest of the year. And yes, we're fully on track with what we shared for 2026 at our Capital Markets Day. So exciting times for us.

Next question comes from Graham from UBS.

Just in terms of thinking about Care Delivery and sort of the moving parts for next year, I know it just directionally, but just phosphate binders presumably just lapping it becomes a bit tougher and it's been such a big driver of growth this year. Is it not reasonable to think that volume -- like U.S. volume growth becomes more important? And just if I look at the first 9 months of this year, 2024 and 2023, there's not a huge difference. And obviously, next year, we've got the head-to-head of like HDF coming through, but then equally maybe some new drugs for IgA nephropathy. So when you look at it, just like how confident are you that you can generate volume growth, which in turn generates operating leverage rather than phosphate binders and cost savings driving Care Delivery margins, just as we shift away from the cost piece driving growth and more so the actual top line?

Yes. Thanks, Graham. Great question. So obviously, as we're trying to help you guys think about phosphate binders. You can obviously see where we are seeing the benefit is in our pharma business. So that's less of an FKC topic, more of just the pharma volume, which we do supply those projects both within our own clinics, but also to outside customers. So that -- while we're still in this period through 2026 will become a topic of what is the volume, what is the utilization of those drugs and what is the pricing. So obviously, we have to see how that plays out.

And obviously, on your question on volume, while we've got these low volumes and numbers, you can obviously see that the impact on EBIT in itself is not the number that makes or breaks any given year. And as you know, in running this business, it is all about kind of the balance and think about those moving parts for next year, the balance of underlying volume kind of the reimbursement, our operating leverage and utilization in our clinics. So we're kind of taking a hard look at that. And then the efficiencies that we drive and obviously managing labor.

So as we all appreciate, volume is always helpful to drive that operating leverage. And I think the other thing here is that there are parts of our country in places that we operate that we are seeing growth, and we are really pleased with that progress. So we're kind of constantly amongst our 2,600 network of clinics, looking at where we're seeing growth, where there's opportunity to further grow and expand. And obviously, in other areas, look to see if we need to sort of consolidate or exit some clinics. So we are preparing all those scenarios, but obviously, under the assumption that volume is returning, and the work that we are doing, which shouldn't be underestimated on the outflow side that if we can reduce hospitalizations and we can reduce missed treatments that obviously adds to the volume on the patients we already have.

So as you say, when you add in the benefit from HDF and for those that are on GLPs, we like that mortality benefit they get to. I think that overall kind of is giving us some confidence that where we can see outside elevated mortality, the things we can control, we're starting to see some improvement on. So I think it's a combination of all the things that we do and what will make us operationally excellent on balancing the volume, the price, the mix, the operating leverage, the clinic footprint and the cost structure. So it's -- I think we understand all those moving parts and more than ever seeing the benefits of the work we've been doing this past couple of years on the turnaround and transformation.

Maybe just a quick one on the HDF benefit. Should we -- just based on what we saw in CONVINCE should we see kind of a benefit in the actual headline U.S. treatment number next year? Or should we think about it maybe more like a phasing into the first half of, say, '27?

Look, I think the expectation is once patients are on it, the CONVINCE trial did show that after 3 months, we got benefit. So as we ramp up for those patients that are on it, we should start to see improvement. Now obviously, as it ramps up, we -- I would say, maybe this time next year, we can start to say, hey, this is what benefit we're getting from those patients on HDF, but we're going to need to kind of get that data behind us.

Obviously, '26 being the ramp-up year, you won't feel or see the full effect. But we are -- as you can appreciate, this is an opportunity for us to track patient 0, if you will, and really start to kind of see the data of those patients that are on HDF and what their performance is on that -- on this treatment. So '26 maybe -- not maybe while we're excited, obviously, it is ramping up over the years. So we will tease out the relevant KPIs as we go through next year and report on what seems to be kind of the right insights for you guys.

The next question comes from David from JPMorgan.

Firstly, maybe your key competitor, DaVita quantified the impact on EBIT next year, well, actually the next 3 years, if the subsidies aren't extended. I'm just wondered if you were willing to do the same. And then secondly, just a bit of a specific one. But volumes in Q3, were they impacted negatively by a sales day mix? And does that become a tailwind in the fourth quarter?

Yes. Thanks, David. Let me tackle that first -- the second one first. Spain market treatment growth for us normalizes days. So our 0.1% is like-for-like. Where it would be impacted on mixed days is on the overall treatment numbers. So our same market treatment growth is pure. So just want to dispel any conclusion that the market might have picked up on that one. David, on 2026, as you can appreciate, we're still in, as I've mentioned, still in planning, I'm not prepared to put any number out there while we're still working through that and even reviewing it. We haven't reviewed it with our -- finalized it with our management Board at a known Supervisory Board at this point.

So I think you understand the levers, you understand our usual headwinds and tailwinds, you understand some of the moving parts that we're watching. I think that's all I can say at this point, and you'd be surprised if I said anything different because you know me, but thank you for asking.

So the next question comes from Anna from Bank of America.

Maybe as a follow-up to one of Graham's questions on the impact of the HVHDF rollout for next year. Do you think that could start to positively impact U.S. same market treatment growth from a referral standpoint as soon as next year? Just any color on how you're thinking about that. And then as well on the Care Delivery growth of the 5.6%, those 3 components, the favorable rate mix, phosphate binders and implicit price concessions decreasing, I think you've broken out the phosphate binders pretty clearly, but any other numbers you could give us around those other 2 components and how you expect those to trend into Q4 would be super helpful.

Yes. Thanks, Anna. Let me take the HDF question, and Martin can maybe unpack the CD question that you have. Look, on your referrals number, yes, I would suggest and think that, that is, my pen just fell apart that would help us positively. I deliberately read the quote from one of our nephrologists and we've had a number of nephrologists kind of coming through our clinics to see this.

So yes, we have seen significant interest and positive feedback and we are being -- as you can appreciate, quite deliberate in where we are launching HDF first. So that is, yes, really exciting. And as you kind of -- on the back of Graham's question, that mortality improvement and the kind of the increased treatment improvement, we should see as soon as we get patients moving on this, and that should ramp up over '26. So really exciting to see that, and I can't wait to hear how [ AFN ] goes this week, but the team that's there.

Martin, do you want to take the CD piece?

Sure. And for the implicit price concessions as well as for the rate mix assumptions that we have for CD. You saw this being a positive in quarter 3. This is the work we do in revenue cycle management paying off and us increasing our revenue yield. So we are collecting more for the amounts that we invoice. This is an ongoing effort, and we are seeing the first benefits and we do expect this to also be a positive in the coming quarters for us as well. And that does also impact then on the, let's say, underlying performance improvement and will be a positive [indiscernible].

So we do not have any further questions. I would like to thank you all for listening and for asking questions and being interested and hope to see many of you on the road in the next couple of weeks. Thank you.

Thanks all.

Thank you.

Take care. Bye-bye.

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