Fresenius SE & Co. KGaA

Investor Presentation • Sep 13, 2017

A Leading Global Health Care Group

Bank of America / Merrill Lynch - European Credit Conference September 13, 2017 – London

This presentation contains forward-looking statements that are subject to various risks and uncertainties. Future results could differ materially from those described in these forwardlooking statements due to certain factors, e.g. changes in business, economic and competitive conditions, regulatory reforms, results of clinical trials, foreign exchange rate fluctuations, uncertainties in litigation or investigative proceedings, and the availability of financing. Fresenius does not undertake any responsibility to update the forward-looking statements contained in this presentation.

General information

Financial figures in this presentation are according to IFRS.

Agenda

• 1 Company Overview
• 2 Business Segments
• − Fresenius Medical Care
• − Fresenius Kabi
• − Fresenius Helios
• − Fresenius Vamed
• 3 Acquisition of Akorn & Merck's Biosimilars Business
• 4 Financial Overview
• 5 Financing Facilities and Debt Structure
• 6 Summary and Outlook

Company Overview

Fresenius Group: A Global Leader in Health Care Products and Services

1 – LTM June 30, 2017

2 – Incl. attributable to non-controlling interest

Fresenius Group: Strong and Balanced Health Care Portfolio

Market Cap.5: €24.2 bn

1 – LTM June 30, 2017, EBITDA before special items

• 2 Based on market capitalization of FSE as of August 31, 2017
• 3 Based on consolidated market capitalization of FSE and FME as of August 31, 2017 and consolidated net debt as of June 30, 2017
• 4 Held by Fresenius ProServe GmbH, a wholly owned subsidiary of FSE
• 5 Based on market capitalization of FME as of August 31, 2017

Fresenius Group: Strong Financial Results

1 – Before special items

2 – Incl. attributable to non-controlling interest

Fresenius Group: Sustainable Organic Sales Growth

1 – Excluding effects of VA-agreement

Fresenius Group: Sustainable Organic Sales Growth in all Business Segments

12% 9% 9% 5% 4% 8% 5% 6% 2010 2011 2012 2013 2014 2015 2016 LTM H1/17

1 – Excluding effects of VA-agreement

2 – Due to project delays in Russia and Ukraine

Fresenius Group: Key Financial Results H1/2017

1 – Before special items

2 – Net income incl. attributable to non-controlling interest

3 – Including effects of the VA-agreement

4 – Net income attributable to shareholders of Fresenius SE & Co. KGaA

Business Segments

Fresenius Medical Care: Global Dialysis Market Leader

• The world's leading provider of dialysis products and services treating 315,305 patients1 in 3,690 clinics1
• Provide highest standard of product quality and patient care
• Expansion in Care Coordination and global dialysis service opportunities; new geographies

• Provide highest standard of product Dialysis products

quality and patient care Dialysis services

		Complete therapy offerings
--	--	----------------------------	--	--

1 – As of June 30, 2017 2 – LTM June 30, 2017, according to FSE region definition

Market Dynamics

Global Dialysis Market 2016:

• ~\$76 billion
• ~6% global patient growth p.a.

Growth Drivers:

• Aging population, increasing incidence of diabetes and high blood pressure, treatment quality improvements

Fresenius Medical Care: Leading in all Regions1

1 – Company data and internal estimates, as of December 31, 2016

Fresenius Medical Care: IG rating reflects prudent financial policy

1 – Pro Forma acquisitions and adjusted for non-cash charges

Fresenius Medical Care: Strong Growth Track Record & High Profitability

1 – Before special items

2 – EBITDA Margin

Fresenius Medical Care: Key Figures H1/2017

€ million	H1/2017	H1/2016	Growth
Total Sales	9,019	7,942	+14%1
EBITDA	1,611	1,406	+15%
Margin	17.9%	17.7%
EBIT	1,235	1,068	+16%
Margin	13.7%	13.5%
Net Income2	577	477	+21%3

1 – 7% organic growth, 4% acquisitions, divestitures and the VA-agreement, 3% currency effects

2 – Net income attributable to shareholders of Fresenius Medical Care AG & Co. KGaA

3 – Excluding the VA-agreement, net income increased by 10% (8% cc)

Fresenius Kabi: A Worldwide Leading Hospital Supplier

• Comprehensive product portfolio for critically and chronically ill patients
• Strong Emerging Markets presence
• Leading market positions in four product segments

• Focus on organic growth through geographic product rollouts and new product launches

Market Dynamics

Global Addressable Market 2016:

• >€48 billion

Growth Drivers:

• Patent expirations, rising demand for health care services, higher health care spending in Emerging Markets

1 – LTM June 30, 2017

Fresenius Kabi: Strong Growth Track Record & High Profitability

1 – Before special items

Fresenius Kabi: Key Figures H1/2017

€ million	H1/2017	H1/2016	Growth
Total Sales	3,202	2,946	+9%1
EBITDA2	767	739	+4%
Margin	24.0%	25.1%
EBIT2	622	582	+7%
Margin	19.4%	19.8%
Net Income2,3	379	336	+13%

1 – 7% organic growth, 2% currency effects

2 – 2017 before special items

3 – Net income attributable to shareholders of Fresenius Kabi AG

Fresenius Helios: Helios Kliniken Germany

• Quality leader in the German hospital sector
• ~6% share in German acute care hospital market
• Solid organic growth based on growing number of admissions and reimbursement rate increases
• Strong track record in hospital acquisitions and operation

Market Dynamics

German Acute Care Hospital Market:

• ~€94 billion1

Growth Drivers:

• Aging of population, focus on larger entities, growing transparency of medical quality

Largest Network & Nationwide Presence2

1 – German Federal Statistical Office 2016; total costs, gross of the German hospitals less academic research and teaching

2 – As of June 30, 2017

Fresenius Helios: Quirónsalud Spain

2016 Financial Highlights

• €2,540 m Sales
• €461 m EBITDA, ~18% Margin
• ~10% share in Spanish private hospital market
• Market leader in size and quality with excellent growth prospects
• Broad revenue base with privately insured patients, PPPs, self-pay and Occupational Risk Prevention (ORP)

Market Dynamics

Spanish Private Hospital Market:

• ~€13 billion1

Growth Drivers:

• Increasing number of privately insured patients, greenfield projects, market consolidation

Quirónsalud Hospitals in Every Major Metropolitan Region of Spain2

1 – Market data based on company research. Market definition does neither include PPPs nor ORP centers

2 – As of June 30, 2017 (including 1 hospital in Peru)

<0.5

Fresenius Helios: Quirónsalud: Integration Status and Growth Prospects

Integration process

• Procurement analysis phase successfully completed; implementation phase commenced (e.g. lab disposables)
• Openness to learn from the best e.g. compare experience on medical practices

Growth prospects

• €50m greenfield investment project in Córdoba Andalusia on track:
• − 115 bed hospital provides state-of-the-art medical equipment and care
• − Opening expected for June 2018
• €31m hospital expansion in Pozuelo, Madrid
• − 2 additional operating theatres, 25 new examination rooms, 7 additional intensive care beds, new state-of-the-art MRI

Strong position

• PPP contracts in place up to 2041
• Four Quirónsalud hospitals ranked in Top 10 of Hospital Excellence Index (HEI)

Fresenius Helios: Impressive Growth and Profitability

2 – EBITDA Margin

Fresenius Helios: Key Figures H1/2017

€ million	H1/2017	H1/2016	Growth
Total Sales	4,256	2,912	+46%1
EBITDA	711	427	+67%
Margin	16.7%	14.7%
EBIT2	537	332	+62%
Margin	12.6%	11.4%
Net Income3	373	262	+42%

1 – 4% organic growth, 42% acquisitions (mainly Quirónsalud)

2 – EBIT of Helios Kliniken (excl. Quirónsalud) increased by 8% to €359 million with a margin of 11.8% (H1/2016: 11.4%)

3 – Net income attributable to shareholders of HELIOS Kliniken GmbH

2017

1

2010

1 – LTM June 30, 2017

Fresenius Vamed: A Leading Specialist in Hospital Projects and Services

• Manages hospital construction/expansion projects and provides services for health care facilities
• Offers project development, planning, turnkey construction, maintenance as well as technical management, and total operational management
• Strong track record:

50%

32%

% of total sales

• More than 800 projects in 79 countries completed
• Services provided to ~600 hospitals and ~143,000 beds globally

Service Business Project Business

50%

68%

Growth Drivers:

• Emerging Market demand for building and developing hospital infrastructure
• Outsourcing of non-medical services from public to private operators

Acquisition of Akorn & Merck's Biosimilars Business: Fresenius Kabi to Strengthen and Diversify its Product Portfolio

Acquisition of Akorn & Merck's Biosimilars Business: Strategic acquisitions for further growth

• No change in 2018 expectations1
• Transaction offers offensive and defensive merits
• Akorn shareholders approved merger agreement with vast majority

• Closing targeted for 2017

• Closing on August 31, 2017

• Improving regulatory environment
• Product pipeline: All studies well on track
• Adalimumab: Filing for European approval expected for Q4/17

1 - Assuming the transaction closes at the end of 2017, Fresenius Kabi projects 2018 sales from this business of US\$1,035 to 1,085 million, and EBITDA before integration costs of approximately US\$380 to 420 million.

Note: Sales mix based on 2016 data

Acquisition of Akorn: Strategic Rationale

Dosage forms Distribution channels

Expands existing U.S. market access

channels: retail, clinics and physicians

\$34 per share or \$4.3 billion in total Cash purchase price
Assumed net debt1	~\$0.45 billion
Synergies	~\$100 million p.a. before tax in mid-term by integration and modernization of production network, improvement of supply chain and a combination of other functions
Integration costs	~\$140 million before tax in total for 2018 - 2022
Amortization charge	Initially ~\$130 million p.a.
Accretion	Accretive in 2018 excluding integration costs, from 2019 onwards including integration costs
Closing	Targeted for 2017

^{1 –} Projected net debt as of December 31, 2017

Direct access to attractive biosimilars development platform with a pipeline of a single-digit number of molecules in oncology and autoimmune diseases

Experienced team of >70 biosimilars experts with excellent development know-how and a network of external partners supporting documentation, development and regulatory affairs

Support from Merck Biopharma in manufacturing, analystics, regulatory, quality, safety and clinical operations

Acquisition of Merck's Biosimilars Business: Sound risk/reward ratio

Purchase price	€156 million upfront payment
Milestone payments	Up to €500 million, strictly tied to achievement of development targets
Sales	First sales in 2019, ramp-up to high triple-digit € million from 2023 onwards
EPS1	Significantly accretive from 2023 onwards
Self-imposed investment ceiling	€1.4 billion incl. upfront and milestone payments as well as ramp-up of R&D and M&S expenses until EBITDA break-even in 2022
Financing	Mainly free cash flow
Closing	August 31, 2017

^{1 –} Net income attributable to shareholders of Fresenius SE & Co. KGaA

Financial Overview

Fresenius Group: Demonstrating Strong Sales and EBITDA Growth

1 – Before special items

2 – EBITDA Margin

Fresenius Group: Key Figures H1/2017

€ million	H1/2017	H1/2016	Growth
Total Sales	16,894	14,218	+19%1
EBITDA2	3,098	2,586	+20%
Margin	18.3%	18.2%
EBIT2	2,393	1,987	+20%
Margin	14.2%	14.0%
Net Income3	1,478	1,216	+22%4
Employees	268,508	227,856

1 – 6% organic growth (excluding effects of VA-agreement), 11% acquisitions and the VA-agreement at FME, 2% currency effects

2 – 2017 before special items

• 3 Net income incl. attributable to non-controlling interest
• 4 Including effects from the VA-agreement

Fresenius Group: Proven Track Record of Deleveraging

Net Debt/EBITDA¹

1 – At actual FX rates for both Net Debt and EBITDA

• 2 Before special items
• 3 Pro Forma excluding advances made for the acquisition of hospitals from Rhoen-Klinikum AG, before special items
• 4 Pro Forma acquisitions

5 – Pro Forma acquisitions of Akorn, Inc. and Merck KGaA's biosimilars business; before transaction costs of ~€50 million; excluding further potential acquisitions and at annual average FX rates for both EBITDA and net debt

Financing Facilities and Debt Structure

Fresenius Group: Capitalization – June 30, 2017

Instrument per Book Value	in € million	in \$ million3	% of total cap	EBITDA LTM x
FSE 2013 Credit Agreement: Revolver (€, US-\$)	300	4 342	0.4%
FSE 2013 Credit Agreement: Term Loan A (€, US-\$)	2,301	2,626	3.1%
Senior Notes (€, US-\$)	5,286	6,032	7.1%
Convertible Bonds	922	1,052	1.2%
Schuldschein Loans	2,014	2,298	2.7%
Commercial Paper	365	417	0.5%
Other debt	703	802	0.9%
Total Debt (FSE excl. FMC), gross	11,891	13,570	15.9%
Cash (excl. FMC)	650	742	0.9%
Total debt (FSE excl. FMC), net	11,241	12,828	15.0%
Total FMC debt, net	7,324	8,358	9.8%
Consolidation Adjustments	(26)	(30)
Total consolidated debt, net	18,539	21,157	24.8%	2.9x
Market capitalization1	56,180	66,433	75.2%	8.9x
Total capitalization	74,719	87,590	100.0%	11.9x
FSE Group EBITDA2				6,287

1 – Based on market capitalization for FSE and FME as of August 31, 2017

2 – Before special items; Pro Forma acquisitions (Quirónsalud and acquisitions of Fresenius Medical Care)

3 – EUR/USD exchange rate as of June 30, 2017, except for market capitalization which uses the exchange rate as of August 31, 2017

Fresenius Group excl. Fresenius Medical Care: Debt Maturity Profile – June 30, 20171,2

1 – Based on utilization of major financing instruments

2 – Pro Forma refinancing of the FSE Credit Agreement

Fresenius Group: Debt Maturity Profile – June 30, 20171,2

1 – Based on utilization of major financing instruments

2 – Pro Forma refinancing of the FMC and FSE Credit Agreement

Summary and Outlook

Fresenius Group: 2017 Financial Outlook by Business Segment1

€ million		2017e
	Sales growth1 (cc)	8% – 10%
	Net income1,2 (cc)	7% – 9%
	Sales growth (org)	5% – 7%
	EBIT growth (cc)	8%3 6% –
	Sales growth (org)	5%4 3% –
	Sales (reported)	~8.6 bn5
	EBIT	1,020–1,0706
	Sales growth (org)	5% – 10%
	EBIT growth	5% – 10%
4 – Helios Kliniken Germany, excluding Quirónsalud 1 – Excluding effects from the VA-agreement 5 – Thereof Quirónsalud (11 months consolidated): ~€2.5bn 2 – Net income attributable to shareholders of FMC AG & Co. KGaA 6 – Thereof Quirónsalud (11 months consolidated): EBIT of €300 to €320m 3 – Before transaction costs of ~€50 million for the acquisitions of Akorn and Merck's biosimilars business; before expected expenditures for the further development of

Merck's biosimilars business of ~€60 million

Fresenius Group: 2017 Financial Guidance

€ million		2017e
	Sales growth (cc)	15% – 17%
	Net income growth1 (cc)	21%2 19% –
	Net debt / EBITDA3	~3.3x

1 – Net income attributable to shareholders of FMC AG & Co. KGaA

2 – Before transaction costs of ~€50 million for the acquisitions of Akorn, Inc. and Merck KGaA's biosimilars business; before expected expenditures for the further development of Merck KGaA's biosimilars business of ~€60 million

3 – Pro Forma acquisitions of Akorn, Inc. and Merck KGaA's biosimilars business; before transaction costs of ~€50 million; excluding further potential acquisitions and at annual average FX rates for both EBITDA and net debt

Strong Growth Fundamentals: Aging Population and Increasing Healthcare Spending

60+

• Aging population and higher incidence of chronic diseases World population age 60+ will reach >2bn by 2050¹

• Increasing health expenditure per capita, 2014 vs. 1999 – USA \$9,403 (+108%), China: \$420 (+977%), India: \$75 (+317%)2

• By 2022, one third of all global health expenditure will occur in Emerging Economies³ 1/3

• 1 WHO: 10 facts on aging and the life course

• 2 World Bank: Health expenditure per capita
• 3 World Economic Forum: Health Systems Leapfrogging in Emerging Economies Project Paper (2014)

Fresenius Group: Ambitious Mid-Term Targets

1 – Mid-point of the February 2017 sales guidance, adjusted for exchange rates as of February 2017

2 – Mid-point of the February 2017 net income guidance, adjusted for exchange rates as of February 2017

3 – Calculated on the basis of the mid-point of the 2020 target range

At February 2017 exchange rates; excluding strategic acquisitions; at current IFRS rules

Fresenius Group: Investment Highlights