Quarterly Financial Report of Fresenius Group

applying United States Generally Accepted Accounting Principles (U.S. GAAP)

1st – 3rd Quarter and 3rd Quarter 2016

3 Fresenius Group fi gures at a glance

5 Fresenius share

6 Management Report

6 Health care industry
6 Results of operations, fi nancial position, assets and liabilities
6 Sales
7 Earnings
8 Investments
9 Cash fl ow
9 Asset and liability structure
10 Third quarter of 2016
11 Business segments
11 Fresenius Medical Care
13 Fresenius Kabi
15 Fresenius Helios
16 Fresenius Vamed
17 Employees
17 Research and development
17 Opportunities and risk report
18 Rating
18 Announced Acquisitions
18 Subsequent events
18 Outlook 2016

20 Consolidated fi nancial statements

20 Consolidated statement of income
20 Consolidated statement of comprehensive income
21 Consolidated statement of fi nancial position
22 Consolidated statement of cash fl ows
23 Consolidated statement of changes in equity
25 Consolidated segment reporting fi rst three quarters of 2016
26 Consolidated segment reporting third quarter of 2016

27 Notes

50 Financial Calendar

This Quarterly Financial Report was published on November 1, 2016.

FRESENIUS GROUP FIGURES AT A GLANCE

Fresenius is a global health care group providing products and services for dialysis, hospitals, and outpatient medical care. In addition, Fresenius focuses on hospital operations. We also manage projects and provide services for hospitals and other health care facilities. In 2015, Group sales were € 27.6 billion. As of September 30, 2016, more than 230,000 employees have dedicated themselves to the service of health in about 100 countries worldwide.

SALES, EARNINGS, AND CASH FLOW

€ in millions	Q3 / 2016	Q3 / 2015	Change	Q1 – 3 / 2016	Q1 – 3 / 2015	Change
Sales	7,339	6,940	6%	21,345	20,369	5%
EBIT 1	1,082	1,027	5%	3,092	2,849	9%
Net income 2	399	367	9%	1,154	1,009	14%
Earnings per share in € 2	0.73	0.68	7%	2.11	1.86	13%
Operating cash fl ow	929	900	3%	2,259	2,151	5%

BALANCE SHEET AND INVESTMENTS

€ in millions	Sept. 30, 2016	Dec. 31, 2015	Change
Total assets	44,075	42,959	3%
Non-current assets	32,940	32,480	1%
Equity 3	19,086	18,003	6%
Net debt	13,345	13,725	- 3%
Investments 4	1,636	1,222	34%

RATIOS

€ in millions	Q3/ 2016	Q3 / 2015	Q1 – 3 / 2016	Q1 – 3 / 2015
EBITDA margin 1	18.7%	18.9%	18.5%	18.0%
EBIT margin 1	14.7%	14.8%	14.5%	14.0%
Depreciation and amortization in % of sales	4.0%	4.1%	4.0%	4.1%
Operating cash fl ow in % of sales	12.7%	13.0%	10.6%	10.6%
Equity ratio (September 30 / December 31)			43.3%	41.9%
Net debt / EBITDA (September 30 / December 31) 5			2.50	2.68

2015 before special items

Net income attributable to shareholders of Fresenius SE & Co. KGaA; 2015 before special items

Equity including noncontrolling interest Investments in property, plant and equipment, and intangible assets, acquisitions (nine months)

2015 before special items, at LTM average exchange rates for both net debt and EBITDA, 2016 pro forma acquisitions.

For a detailed overview of special items please see the reconciliation table on page 8.

INFORMATION BY BUSINESS SEGMENT

FRESENIUS MEDICAL CARE – Dialysis products, Dialysis services

US\$ in millions	Q3 /2016	Q3 /2015	Change	Q1 – 3 / 2016	Q1 – 3 / 2015	Change
Sales	4,598	4,231	9%	13,224	12,390	7%
EBIT	670	614	9%	1,851	1,665	11%
Net income 1	333	262	27%	855	713	20%
Operating cash fl ow	439	579	- 24%	1,296	1,412	- 8%
Investments / Acquisitions	332	311	7%	1,245	881	41%
R & D expenses	44	35	26%	120	100	20%
Employees, per capita on balance sheet date (September 30 / December 31)				115,774	110,242	5%

FRESENIUS KABI – IV drugs, Clinical nutrition, Infusion therapy,

Medical devices / Transfusion technology

€ in millions	Q3 /2016	Q3 /2015	Change	Q1 – 3 / 2016	Q1 – 3 / 2015	Change
Sales	1,511	1,499	1%	4,457	4,431	1%
EBIT 2	300	301	0%	916	872	5%
Net income 3	173	170	2%	532	479	11%
Operating cash fl ow	311	235	32%	646	589	10%
Investments / Acquisitions	83	72	15%	299	249	20%
R & D expenses 2	88	82	7%	249	243	2%
Employees, per capita on balance sheet date (September 30 / December 31)				34,394	33,195	4%

FRESENIUS HELIOS – Hospital operations

€ in millions	Q3 /2016	Q3 /2015	Change	Q1 – 3 / 2016	Q1 – 3 / 2015	Change
Sales	1,470	1,393	6%	4,382	4,167	5%
EBIT 2	175	165	6%	507	472	7%
Net income 4	140	126	11%	402	352	14%
Operating cash fl ow	207	155	34%	437	386	13%
Investments / Acquisitions	79	59	34%	212	171	24%
Employees, per capita on balance sheet date (September 30 / December 31)				72,246	69,728	4%

FRESENIUS VAMED – Projects and services for hospitals and other health care facilities

€ in millions	Q3 /2016	Q3 /2015	Change	Q1 – 3 / 2016	Q1 – 3 / 2015	Change
Sales	268	268	0%	740	731	1%
EBIT	15	14	7%	31	30	3%
Net income 5	10	10	0%	21	20	5%
Operating cash fl ow	21	0	--	22	- 44	150%
Investments / Acquisitions	2	6	- 67%	6	13	- 54%
Order intake	209	192	9%	674	476	42%
Employees, per capita on balance sheet date (September 30 / December 31)				8,076	8,262	- 2%

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

2015 before special items

Net income attributable to shareholders of Fresenius Kabi AG; 2015 before special items

Net income attributable to shareholders of HELIOS Kliniken GmbH; 2015 before special items

Net income attributable to shareholders of VAMED AG

For a detailed overview of special items please see the reconciliation table on page 8.

FRESENIUS SHARE

The Fresenius share reached a new record high of € 72.87 in September. With an increase of 8% since the start of the year, the Fresenius share has outperformed the DAX index, which decreased 2% in the same period.

FIRST TO THIRD QUARTER 2016

Following the year's volatile start and the surprising result of the Brexit referendum, fi nancial markets recovered at the start of the third quarter. The slight recovery of the global economy had a calming effect on the markets. Germany's benchmark index has moved laterally since the beginning of August.

The ECB left its policies unchanged during its September meeting. Its counterpart in the U.S., the Federal Reserve, left rates unchanged in a corridor between 0.25% and 0.5% for the sixth time in a row at its September meeting.

The economic growth of the euro zone continues. The economy in the euro zone should grow 1.6% this year, according to the latest ECB forecast. The Federal Reserve's latest forecast calls for 2% growth in the U.S.

Against this economic backdrop, the DAX fell 2% in the fi rst nine months of 2016 to 10,511 points. The Fresenius share closed at € 71.01 on September 30, 2016, 8% higher than its fi nal closing price in 2015.

KEY DATA OF THE FRESENIUS SHARE

	Q1 – 3 / 2016	2015	Change
Number of shares (September 30 / December 31)	546,932,731	545,727,950
Quarter-end quotation in €	71.01	65.97	8%
High in €	72.87	69.75	4%
Low in €	53.05	42.41	25%
Ø Trading volume (number of shares per trading day)	1,182,791	1,390,878	- 15%
Market capitalization, € in millions (September 30 / December 31)	38,838	36,002	8%

MANAGEMENT REPORT

Fresenius achieved substantial earnings growth in the third quarter, following our very strong development in the first half. Each business segment continued to grow organically in every region. That makes us even more confident for the full year 2016. We raise the lower end of our Group earnings guidance.

CONTINUED STRONG SALES AND EARNINGS GROWTH; LOWER END OF GROUP EARNINGS GUIDANCE RAISED

	Q 3 / 2016	at actual rates	in constant currency	Q1 – 3 / 2016	at actual rates	in constant currency
Sales	€ 7.3 bn	+ 6%	+ 7%	€ 21.3 bn	+ 5%	+ 6%
EBIT 1	€ 1,082 m	+ 5%	+ 6%	€ 3,092 m	+ 9%	+ 9%
Net income 2	€ 399 m	+ 9%	+ 10%	€ 1,154 m	+ 14%	+ 15%

HEALTH CARE INDUSTRY

The health care sector is one of the world's largest industries. It is relatively insensitive to economic fl uctuations compared to other sectors and has posted above-average growth over the past years.

The main growth factors are rising medical needs deriving from aging populations, the growing number of chronically ill and multimorbid patients, stronger demand for innovative products and therapies, advances in medical technology and the growing health consciousness, which increases the demand for health care services and facilities.

In the emerging countries, drivers are the expanding availability and correspondingly greater demand for basic health care and increasing national incomes and hence higher spending on health care.

Health care structures are being reviewed and cost-cutting potential identifi ed in order to contain the steadily rising health care expenditures. However, such measures cannot compensate for the cost pressure. Market-based elements

are increasingly being introduced into the health care system to create incentives for cost- and quality-conscious behavior. Overall treatment costs shall be reduced through improved quality standards. In addition, ever-greater importance is being placed on disease prevention and innovative reimbursement models linked to treatment quality standards.

RESULTS OF OPERATIONS, FINANCIAL POSITION, ASSETS AND LIABILITIES

SALES

Group sales increased by 5% (6% in constant currency) to € 21,345 million (Q1 – 3 / 2015: € 20,369 million). Organic sales growth was 6%. The minor negative currency translation effects (- 1%) were mainly related to the devaluation of Latin American currencies against the Euro. Acquisitions contributed 1% and divestitures reduced sales by 1%.

2015 before special items Net income attributable to shareholders of Fresenius SE & Co. KGaA; 2015 before special items

For a detailed overview of special items please see the reconciliation table on page 8.

EARNINGS

€ in millions	Q3 / 2016	Q3 / 2015	Q1 – 3 / 2016	Q1 – 3 / 2015
EBIT 1	1,082	1,027	3,092	2,849
Net income 2	399	367	1,154	1,009
Net income 3	399	357	1,154	999
Earnings per share in € 2	0.73	0.68	2.11	1.86
Earnings per share in € 3	0.73	0.66	2.11	1.84

EARNINGS

Group EBITDA1 increased by 7% (8% in constant currency) to € 3,949 million (Q1 – 3 / 2015: € 3,674 million). Group EBIT ¹ increased by 9% (9% in constant currency) to € 3,092 million (Q1 – 3 / 2015: € 2,849 million). The EBIT margin 1 increased to 14.5% (Q1 – 3 / 2015: 14.0%).

Group net interest decreased to -€ 433 million (Q1 – 3 / 2015: -€ 476 million), mainly due to more favorable fi nancing terms and lower net debt.

With 28.1%, the Group tax rate 1 was below the previous year (Q1 – 3 / 2015: 29.6%). The decrease is mainly due to released tax accruals at Fresenius Medical Care in Q3 / 2016.

Noncontrolling interest increased to € 759 million (Q1 – 3 / 2015: € 661 million), of which 96% was attributable to the noncontrolling interest in Fresenius Medical Care.

Group net income2 increased by 14% (15% in constant currency) to € 1,154 million (Q1 – 3 / 2015: € 1,009 million). Earnings per share 2 increased by 13% (15% in constant currency) to € 2.11 (Q1 – 3 / 2015: € 1.86).

SALES BY REGION

€ in millions	Q1 – 3 / 2016	Q1 – 3 / 2015	Change at actual rates	Currency trans lations effects	Change at constant rates	Organic growth	Acquisitions / divestitures	% of total sales 4
North America	10,092	9,294	9%	0%	9%	7%	2%	47%
Europe	8,026	7,807	3%	- 1%	4%	3%	1%	38%
Asia-Pacifi c	2,106	2,032	4%	- 2%	6%	8%	- 2%	10%
Latin America	882	980	- 10%	- 19%	9%	12%	- 3%	4%
Africa	239	256	- 7%	- 9%	2%	2%	0%	1%
Total	21,345	20,369	5%	- 1%	6%	6%	0%	100%

SALES BY BUSINESS SEGMENT

€ in millions	Q1 – 3 / 2016	Q1 – 3 / 2015	Change at actual rates	Currency trans lations effects	Change at constant rates	Organic growth	Acquisitions / divestitures	% of total sales 4
Fresenius Medical Care	11,847	11,118	7%	- 1%	8%	7%	1%	55%
Fresenius Kabi	4,457	4,431	1%	- 3%	4%	6%	- 2%	21%
Fresenius Helios	4,382	4,167	5%	0%	5%	4%	1%	21%
Fresenius Vamed	740	731	1%	0%	1%	2%	- 1%	3%

2015 before special items

Net income attributable to shareholders of Fresenius SE & Co. KGaA; 2015 before special items

Net income attributable to shareholders of Fresenius SE & Co. KGaA Calculated on the basis of contribution to consolidated sales

For a detailed overview of special items please see the reconciliation table on page 8.

RECONCILIATION

The Group's U.S. GAAP fi nancial results as of September 30, 2016 do not include special items, whereas the U.S. GAAP fi nancial results as of September 30, 2015 include special items. Net income attributable to shareholders of Fresenius SE & Co. KGaA was adjusted for these special items. The table below shows the special items and the reconciliation from net income (before special items) to earnings according to U.S. GAAP.

INVESTMENTS

Spending on property, plant and equipment was € 1,044 million (Q1 – 3 / 2015: € 950 million), primarily for the modernization and expansion of dialysis clinics, production facilities and hospitals.

Total acquisition spending was € 592 million (Q1 – 3 / 2015: € 272 million), including the acquisition of dialysis clinics and further expansion in the fi eld of care coordination at Fresenius Medical Care, the acquisition of a U.S. pharmaceutical plant for ready-to-administer prefi lled syringes at Fresenius Kabi and the acquisition of the municipal hospital Niederberg at Fresenius Helios.

€ in millions	Q1 – 3 / 2016 (before special items)	Kabi effi ciency program	integration costs for acquired Rhön hospitals	disposal gains from two HELIOS hospitals	Q1 – 3 / 2016 according to U.S. GAAP (incl. spe cial items)	Q1 – 3 / 2015 (before special items)	Kabi effi ciency program	integration costs for acquired Rhön hospitals	disposal gains from two HELIOS hospitals	Q1 – 3 / 2015 according to U.S. GAAP (incl. spe cial items)
Sales	21,345				21,345	20,369				20,369
EBIT	3,092				3,092	2,849	- 50	- 12	34	2,821
Interest result	- 433				- 433	- 476				- 476
Net income before taxes	2,659	0	0	0	2,659	2,373	- 50	- 12	34	2,345
Income taxes	- 746				- 746	- 703	16	2	0	- 685
Net income	1,913	0	0	0	1,913	1,670	- 34	- 10	34	1,660
Less noncontrolling interest	- 759				- 759	- 661				- 661
Net income attributable to shareholders of Fresenius SE & Co. KGaA	1,154	0	0	0	1,154	1,009	- 34	- 10	34	999

RECONCILIATION

€ in millions	Q3 / 2016 (before special items)	Kabi effi ciency program	integration costs for acquired Rhön hospitals	disposal gains from two HELIOS hospitals	Q3 / 2016 according to U.S. GAAP (incl. spe cial items)	Q3 / 2015 (before special items)	Kabi effi ciency program	integration costs for acquired Rhön hospitals	disposal gains from two HELIOS hospitals	Q3 / 2015 according to U.S. GAAP (incl. spe cial items)
Sales	7,339				7,339	6,940				6,940
EBIT	1,082				1,082	1,027	- 10	- 4	0	1,013
Interest result	- 142				- 142	- 146				- 146
Net income before taxes	940	0	0	0	940	881	- 10	- 4	0	867
Income taxes	- 255				- 255	- 262	4	0	0	- 258
Net income	685	0	0	0	685	619	- 6	- 4	0	609
Less noncontrolling interest	- 286				- 286	- 252				- 252
Net income attributable to shareholders of Fresenius SE & Co. KGaA	399	0	0	0	399	367	- 6	- 4	0	357

The special items are reported in the Group / Other segment.

INVESTMENTS BY BUSINESS SEGMENT

€ in millions	Q1 – 3 / 2016	Q1 – 3 / 2015	thereof property, plant and equipment	thereof acquisitions	Change	% of total
Fresenius Medical Care	1,115	791	670	445	41%	68%
Fresenius Kabi	299	249	185	114	20%	18%
Fresenius Helios	212	171	179	33	24%	13%
Fresenius Vamed	6	13	6	0	- 54%	1%
Corporate / Other	4	- 2	4	0	--	0%
Total	1,636	1,222	1,044	592	34%	100%

CASH FLOW

Operating cash fl ow increased by 5% to € 2,259 million (Q1 – 3 / 2015: € 2,151 million) with a margin of 10.6% (Q1 – 3 / 2015: 10.6%).

Free cash fl ow before acquisitions and dividends decreased slightly to € 1,207 million (Q1 – 3 / 2015: € 1,219 million). Free cash fl ow after acquisitions and dividends was € 253 million (Q1 – 3 / 2015: € 574 million).

ASSET AND LIABILITY STRUCTURE

The Group's total assets increased by 3% (4% in constant currency) to € 44,075 million (Dec. 31, 2015: € 42,959 million), driven by its growing scale of operations. Current assets

grew by 6% (7% in constant currency) to € 11,135 million (Dec. 31, 2015: € 10,479 million). Non-current assets increased by 1% (3% in constant currency) to € 32,940 million (Dec. 31, 2015: € 32,480 million).

Total shareholders' equity grew by 6% (7% in constant currency) to € 19,086 million (Dec. 31, 2015: € 18,003 million). The equity ratio increased to 43.3% (Dec. 31, 2015: 41.9%).

Group debt decreased by 2% (1% in constant currency) to € 14,530 million (Dec. 31, 2015: € 14,769 million). As of September 30, 2016, the net debt / EBITDA ratio was 2.50 1,2 (Dec. 31, 2015: 2.68 1 ).

CASH FLOW STATEMENT (SUMMARY)

€ in millions	Q1 – 3 / 2016	Q1 – 3 / 2015	Change
Net income	1,913	1,660	15%
Depreciation and amortization	857	825	4%
Change in accruals for pensions	- 34	46	- 174%
Cash fl ow	2,736	2,531	8%
Change in working capital	- 477	- 380	- 26%
Operating cash fl ow	2,259	2,151	5%
Property, plant and equipment, investments net	- 1,052	- 932	- 13%
Cash fl ow before acquisitions and dividends	1,207	1,219	- 1%
Cash used for acquisitions, net	- 304	- 63	--
Dividends paid	- 650	- 582	- 12%
Free cash fl ow paid after acquisitions and dividends	253	574	- 56%
Cash provided by / used for fi nancing activities	- 118	- 791	85%
Effect of exchange rates on change in cash and cash equivalents	6	17	- 65%
Net change in cash and cash equivalents	141	- 200	171%

THIRD QUARTER OF 2016

In Q3 / 2016, Group sales increased by 6% (7% in constant currency) to € 7,339 million (Q3 / 2015: € 6,940 million). Organic sales growth was 6%. Acquisitions contributed 1%.

In Q3 / 2016, Group EBIT ¹ increased by 5% (6% in constant currency) to € 1,082 million (Q3 / 2015: € 1,027 million), the EBIT margin 1 was 14.7% (Q3 / 2015: 14.8%).

In Q3 / 2016, the Group tax rate 1 was 27.1% (Q3 / 2015: 29.7%).

In Q3 / 2016, Group net income 1,2 increased by 9% (10% in constant currency) to € 399 million (Q3 / 2015: € 367 million). Earnings per share 1,2 increased by 7% (9% in constant currency) to € 0.73 (Q3 / 2015: € 0.68).

With € 929 million, operating cash fl ow in Q3 / 2016 was slightly above the level of the strong prior-year quarter (Q3 / 2015: € 900 million), despite of a US\$ 100 million discretionary cash contribution of Fresenius Medical Care to its pension plan assets in the United States. The cash fl ow margin was 12.7% (Q3 / 2015: 13.0%).

Investments in property, plant and equipment increased to € 374 million (Q3 / 2015: € 339 million). Acquisition spending was € 87 million (Q3 / 2015: € 78 million).

BUSINESS SEGMENTS

FRESENIUS MEDICAL CARE

Fresenius Medical Care is the world's largest provider of products and services for individuals with chronic kidney failure. As of September 30, 2016, Fresenius Medical Care was treating 306,366 patients in 3,579 dialysis clinics. Along with its core business, the company seeks to expand the range of medical services in the fi eld of care coordination.

US\$ in millions	Q3 / 2016	Q3 / 2015	Change	Q1 – 3 / 2016	Q1 – 3 / 2015	Change
Sales	4,598	4,231	9%	13,224	12,390	7%
EBITDA	867	793	9%	2,424	2,202	10%
EBIT	670	614	9%	1,851	1,665	11%
Net income 1	333	262	27%	855	713	20%
Employees (Sept. 30 / December 31)				115,774	110,242	5%

▶ 9% sales growth in constant currency in Q3
▶ 27% net income growth in Q3 (17% before one-time items 2 )
▶ 2016 outlook confirmed

FIRST THREE QUARTERS OF 2016

Sales increased by 7% (8% in constant currency) to US\$13,224 million (Q1 – 3 / 2015: US\$12,390 million). Organic sales growth was 7%. Acquisitions contributed 1%.

Health Care services sales (dialysis services and care coordination) increased by 8% (9% in constant currency) to US\$10,720 million (Q1 – 3 / 2015: US\$ 9,929 million). Dialysis product sales increased by 2% (4% in constant currency) to US\$ 2,504 million (Q1 – 3 / 2015: US\$ 2,461 million).

In North America, sales increased by 9% to US\$ 9,512 million (Q1 – 3 / 2015: US\$ 8,730 million). Health Care services sales grew by 9% to US\$ 8,838 million (Q1 – 3 / 2015: US\$ 8,087 million). Dialysis product sales increased by 5% to US\$ 674 million (Q1 – 3 / 2015: US\$ 642 million).

Sales outside North America increased by 2% (7% in constant currency) to US\$ 3,700 million (Q1 – 3 / 2015: US\$ 3,639 million). Health Care services sales increased by 2% (9% in constant currency) to US\$1,882 million (Q1 – 3 / 2015: US\$1,842 million). Dialysis product sales remained nearly unchanged at (increased by 5% in constant currency to) US\$1,819 million (Q1 – 3 / 2015: US\$1,797 million).

EBIT increased by 11% (12% in constant currency) to US\$1,851 million (Q1 – 3 / 2015: US\$1,665 million). The EBIT margin was 14.0% (Q1 – 3 / 2015: 13.4%). EBIT before onetime items 3 increased by 10%.

Net income 1 increased by 20% (20% in constant currency) to US\$ 8 55 million (Q1 – 3 / 2015: US\$ 7 13 million). Net income before one-time items 1,2 increased by 16%.

Operating cash fl ow decreased by 8% to US\$1,296 million (Q1 – 3 / 2015: US\$1,412 million). The cash fl ow margin was 9.8% (Q1 – 3 / 2015: 11.4%). The decrease is mainly attributable to a discretionary cash contribution of US\$ 100 million to Fresenius Medical Care's pension plan assets in the United States.

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

2015 before divestiture of dialysis business in Venezuela (- US\$ 27 million after tax) and European pharmaceutical business (US\$ 5 million after tax)

2015 before divestiture of dialysis business in Venezuela (- US\$ 26 million before tax) and European pharmaceutical business (US\$ 8 million before tax)

THIRD QUARTER OF 2016

In Q3 / 2016, sales increased by 9% (9% in constant currency) to US\$ 4,598 million (Q3 / 2015: US\$ 4,231 million). Organic sales growth was 7%.

In Q3 / 2016, EBIT increased by 9% (10% in constant currency) to US\$ 670 million (Q3 / 2015: US\$ 614 million). The EBIT margin was 14.6% (Q3 / 2015: 14.5%). EBIT before one-time items 1 increased by 6%.

In Q3 / 2016, net income 2 grew by 27% (28% in constant currency) to US\$ 333 million (Q3 / 2015: US\$ 262 million). Net income before one-time items 2,3 increased by 17%.

As a consequence, in Q3 / 2016, operating cash fl ow decreased to US\$ 439 million (Q3 / 2015: US\$ 579 million) with a cash fl ow margin of 9.5% (Q3 / 2015: 13.7%). The decrease is mainly attributable to a discretionary cash contribution of US\$ 100 million to Fresenius Medical Care's pension plan assets in the United States.

Please see page 18 of the Management Report for the 2016 outlook of Fresenius Medical Care.

For further information, please see Fresenius Medical Care's Investor News at www.freseniusmedicalcare.com.

2015 before divestiture of dialysis business in Venezuela (- US\$ 26 million before tax) and European pharmaceutical business (US\$ 8 million before tax)

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

2015 before divestiture of dialysis business in Venezuela (- US\$ 27 million after tax) and European pharmaceutical business (US\$ 5 million after tax)

FRESENIUS KABI

Fresenius Kabi offers infusion therapies, intravenously administered generic drugs and clinical nutrition for seriously and chronically ill patients in the hospital and outpatient environments. The company is also a leading supplier of medical devices and transfusion technology products.

€ in millions	Q3 / 2016	Q3 / 2015	Change	Q1 – 3 / 2016	Q1 – 3 / 2015	Change
Sales	1,511	1,499	1%	4,457	4,431	1%
EBITDA 1	361	369	- 2%	1,101	1,060	4%
EBIT 1	300	301	0%	916	872	5%
Net income 2	173	170	2%	532	479	11%
Employees (Sept. 30 / December 31)				34,394	33,195	4%

▶ 5% organic sales growth in Q3
▶ 1% constant currency EBIT ¹ growth in Q3
▶ 2016 outlook raised: both, organic sales growth and EBIT ¹ growth in constant currency of 4% to 6% expected

FIRST THREE QUARTERS OF 2016

Sales increased by 4% in constant currency to € 4,457 million (Q1 – 3 / 2015: € 4,431 million). Organic sales growth was 6%. The divestment of the Australian and German oncology compounding business reduced sales by 2%.

Sales in Europe remained nearly unchanged at € 1,569 million (Q1 – 3 / 2015: € 1,566 million). Organic sales growth was 2%. Divestitures reduced sales by 2%.

Sales in North America increased by 5% (organic growth: 5%) to € 1,628 million (Q1 – 3 / 2015: € 1,555 million), mainly driven by new product launches.

Sales in Asia-Pacifi c decreased by 5% (organic growth: 8%) to € 821 million (Q1 – 3 / 2015: € 862 million). Adverse currency translation effects reduced sales by 5%, divestitures by another 8%.

Given adverse currency translation effects, sales in Latin America / Africa decreased by 2% (organic growth: 16%, in particular due to infl ation driven price increases) to € 439 million (Q1 – 3 / 2015: € 448 million).

EBIT ¹ increased by 5% (7% in constant currency) to € 916 million (Q1 – 3 / 2015: € 872 million). The EBIT margin 1 improved to 20.6% (Q1 – 3 / 2015: 19.7%).

Net income 2 increased by 11% (12% in constant currency) to € 532 million (Q1 – 3 / 2015: € 479 million).

Operating cash fl ow increased by 10% to € 646 million (Q1 – 3 / 2015: € 589 million) with a margin of 14.5% (Q1 – 3 / 2015: 13.3%).

THIRD QUARTER OF 2016

In Q3 / 2016, sales increased by 1% (3% in constant currency) to € 1,511 million (Q3 / 2015: € 1,499 million). Negative currency translation effects (- 2%) were mainly related to the devaluation of the Chinese yuan and the Argentine peso against the Euro. Organic sales growth was 5%.

2015 before special items

Net income attributable to shareholders of Fresenius Kabi AG; 2015 before special items

For a detailed overview of special items please see the reconciliation table on page 8.

In Q3 / 2016, sales in Europe of € 521 million were slightly above prior-year level (Q3 / 2015: € 514 million). Organic sales growth was 3%.

In Q3 / 2016, sales in North America increased by 2% (organic growth: 2%) to € 542 million (Q3 / 2015: € 529 million).

In Q3 / 2016, sales in Asia-Pacifi c decreased by 3% (organic growth: 9%) to € 290 million (Q3 / 2015: € 298 million).

In Q3 / 2016, sales in Latin America / Africa remained unchanged at € 158 million (Q3 / 2015: € 158 million). Organic sales growth was 7%.

In Q3 / 2016, EBIT ¹ remained virtually unchanged at € 300 million (Q3 / 2015: € 301 million). EBIT ¹ increased by 1% in constant currency. The EBIT margin 1 was 19.9% (Q3 / 2015: 20.1%).

In Q3 / 2016, net income 2 increased by 2% (3% in constant currency) to € 173 million (Q3 / 2015: € 170 million).

In Q3 / 2016, operating cash fl ow increased by 32% to € 311 million (Q3 / 2015: € 235 million), due to a catch-up from Q2 / 2016 and temporarily reduced net working capital requirements. The cash fl ow margin increased to 20.6% (Q3 / 2015: 15.7%).

Please see page 18 of the Management Report for the 2016 outlook of Fresenius Kabi.

2015 before special items Net income attributable to shareholders of Fresenius Kabi AG; 2015 before special items

For a detailed overview of special items please see the reconciliation table on page 8.

FRESENIUS HELIOS

Fresenius Helios is Germany's largest hospital operator. HELIOS operates 112 hospitals, thereof 88 acute care clinics (including seven maximum care hospitals in Berlin-Buch, Duisburg, Erfurt, Krefeld, Schwerin, Wiesbaden and Wuppertal) and 24 post-acute care clinics. HELIOS treats more than 4.7 million patients per year, thereof approximately 1.3 million inpatients, and operates approximately 35,000 beds.

€ in millions	Q3 / 2016	Q3 / 2015	Change	Q1 – 3 / 2016	Q1 – 3 / 2015	Change
Sales	1,470	1,393	6%	4,382	4,167	5%
EBITDA 1	223	213	5%	650	612	6%
EBIT 1	175	165	6%	507	472	7%
Net income 2	140	126	11%	402	352	14%
Employees (Sept. 30 / December 31)				72,246	69,728	4%

▶ 4% organic sales growth in Q3
▶ 20 bps sequential EBIT margin increase
▶ 2016 outlook confirmed

FIRST THREE QUARTERS OF 2016

Sales increased by 5% to € 4,382 million (Q1 – 3 / 2015: € 4,167 million). Organic sales growth was 4%. Acquisitions increased sales by 1%.

EBIT ¹ grew by 7% to € 507 million (Q1 – 3 / 2015: € 472 million). The EBIT margin 1 increased to 11.6% (Q1 – 3 / 2015: 11.3%).

Net income 2 increased by 14% to € 402 million (Q1 – 3 / 2015: € 352 million).

Operating cash fl ow increased by 13% to € 437 million (Q1 – 3 / 2015: € 386 million) with a margin of 10.0% (Q1 – 3 / 2015: 9.3%).

THIRD QUARTER OF 2016

In Q3 / 2016, sales increased by 6% to € 1,470 million (Q3 / 2015: € 1,393 million). Organic sales growth was 4%.

In Q3 / 2016, EBIT ¹ increased by 6% to € 175 million (Q3 / 2015: € 165 million). Sequentially, the EBIT margin increased by 20 bps to 11.9%.

In Q3 / 2016, net income 2 increased by 11% to € 140 million (Q3 / 2015: € 126 million).

In Q3 / 2016 operating cash fl ow increased by 34% to € 207 million (Q3 / 2015: € 155 million), mainly driven by decreased working capital. The cash fl ow margin increased to 14.1% (Q3 / 2015: 11.1%).

Please see page 19 of the Management Report for the 2016 outlook of Fresenius Helios.

2015 before special items

Net income attributable to shareholders of HELIOS Kliniken GmbH; 2015 before special items

For a detailed overview of special items please see the reconciliation table on page 8.

FRESENIUS VAMED

Fresenius Vamed manages projects and provides services for hospitals and other health care facilities worldwide. The portfolio ranges along the entire value chain: from project development, planning, and turnkey construction, via maintenance and technical management, to total operational management.

€ in millions	Q3 / 2016	Q3 / 2015	Change	Q1 – 3/ 2016	Q1 – 3/ 2015	Change
Sales	268	268	0%	740	731	1%
EBITDA	18	17	6%	39	38	3%
EBIT	15	14	7%	31	30	3%
Net income 1	10	10	0%	21	20	5%
Employees (Sept. 30 / December 31)				8,076	8,262	- 2%

▶ Strong order intake of € 209 million in Q3

▶ 2016 outlook confi rmed

FIRST THREE QUARTERS OF 2016

Sales increased by 1% (1% in constant currency) to € 740 million (Q1 – 3 / 2015: € 731 million). Organic sales growth was 2%. Sales in the project business decreased by 2% to € 325 million (Q1 – 3 / 2015: € 333 million). Sales in the service business grew by 4% to € 415 million (Q1 – 3 / 2015: € 398 million).

EBIT increased by 3% to € 31 million (Q1 – 3 / 2015: € 30 million). The EBIT margin increased to 4.2% (Q1 – 3 / 2015: 4.1%).

Net income grew by 5% to € 21 million (Q1 – 3 / 2015: € 20 million).

Order intake increased by 42% to € 674 million (Q1 – 3 / 2015: € 476 million). As of September 30, 2016, order backlog grew to € 1,995 million (December 31, 2015: € 1,650 million).

THIRD QUARTER OF 2016

In Q3 / 2016, sales remained unchanged at € 268 million (Q3 / 2015: € 268 million). Organic sales growth was 1%.

In Q3 / 2016, EBIT increased by 7% to € 15 million (Q3 / 2015: € 14 million). The EBIT margin increased to 5.6% (Q3 / 2015: 5.2%).

In Q3 / 2016, net income 1 of € 10 million was at prior-year level (Q3 / 2015: € 10 million).

In Q3 / 2016, order intake increased by 9% to € 209 million (Q3 / 2015: € 192 million).

Please see page 19 of the Management Report for the 2016 outlook of Fresenius Vamed.

EMPLOYEES

As of September 30, 2016, the number of employees increased by 4% to 231,432 (Dec. 31, 2015: 222,305).

EMPLOYEES BY BUSINESS SEGMENT

Number of employees	Sept. 30, 2016	Dec. 31, 2015	Change
Fresenius Medical Care	115,774	110,242	5%
Fresenius Kabi	34,394	33,195	4%
Fresenius Helios	72,246	69,728	4%
Fresenius Vamed	8,076	8,262	- 2%
Corporate / Other	942	878	7%
Total	231,432	222,305	4%

RESEARCH AND DEVELOPMENT

Product and process development as well as the improvement of therapies are at the core of our growth strategy. Fresenius focuses its R & D efforts on its core competencies in the following areas:

▶ Dialysis
▶ Generic IV drugs
▶ Infusion and nutrition therapies
▶ Medical devices

Apart from new products, we are concentrating on developing optimized or completely new therapies, treatment methods, and services.

RESEARCH AND DEVELOPMENT EXPENSES BY BUSINESS SEGMENT

€ in millions	Q1 – 3 / 2016	Q1 – 3 / 2015	Change
Fresenius Medical Care	108	90	20%
Fresenius Kabi	249	243	2%
Fresenius Helios	−	–	--
Fresenius Vamed	0	0	--
Corporate / Other	0	4	--
Total	357	337	7%

DIALYSIS

The complex interactions and side effects that lead to kidney failure are better explored today than ever before. Technological advances develop in parallel with medical insights to

improve the possibilities for treating patients. Our R & D activities at Fresenius Medical Care aim to translate new insights into novel or improved developments and to bring them to market as quickly as possible, and thus make an important contribution towards rendering the treatment of patients increasingly comfortable, safe, and individualized.

INFUSION THERAPIES, CLINICAL NUTRITION, GENERIC IV DRUGS, AND MEDICAL DEVICES

Fresenius Kabi's research and development activities concentrate on products for the therapy and care of critically and chronically ill patients. Our focus is on areas with high medical needs, such as in the treatment of oncology patients. Our products help to support medical advancements in acute and post-acute care and improve the patients' quality of life. We develop new products in areas such as clinical nutrition. In addition, we develop generic drug formulations ready to launch at the time of market formation as well as new formulations for non-patented drugs. Our medical devices signifi cantly contribute to a safe and effective application of infusion solutions and clinical nutrition. In transfusion technology our R & D focus is on medical devices and disposables to support the secure, user-friendly, and effi cient production of blood products.

OPPORTUNITIES AND RISK REPORT

Compared to the presentation in the 2015 annual report, there have been no material changes in Fresenius' overall opportunities and risk situation in the third quarter of 2016.

In the ordinary course of Fresenius Group's operations, the Fresenius Group is subject to litigation, arbitration and investigations relating to various aspects of its business. The Fresenius Group regularly analyzes current information about such claims for probable losses and provides accruals for such matters, including estimated expenses for legal services, as appropriate.

In addition, we report on legal proceedings, currency and interest risks on pages 41 to 45 in the Notes of this report.

RATING

Fresenius is covered by the rating agencies Moody's, Standard & Poor's and Fitch.

The following table shows the company rating of Fresenius SE & Co. KGaA:

	Standard & Poor's	Moody's	Fitch 1
Company rating	BBB -	Baa3	BBB -
Outlook	stable	stable	stable

ANNOUNCED ACQUISITIONS

On September 5, 2016 Fresenius Group announced, that Fresenius Helios acquires IDC Salud Holding S.L.U. ("Quirónsalud"), Spain's largest private hospital operator, for a purchase price of € 5.76 billion (on a cash and debt-free basis). Fresenius Helios acquires 100% of the share capital in Quirónsalud. Sellers are the private equity group CVC Capital Partners, the founder and CEO of Quirónsalud Víctor Madera, as well as other members of Quirónsalud's management board.

The transaction is subject to regulatory approval by the relevant antitrust authorities and is expected to close in Q1 / 2017.

On September 6, 2016, Fresenius SE & Co. KGaA entered into a Bridge Financing Facility in the amount of € 3,750 million with a group of banks. The Bridge Financing Facility is guaranteed by Fresenius Kabi AG and Fresenius ProServe GmbH. It is planned to temporarily utilize this facility to fund the acquisition of IDC Salud Holding S.L.U. (Quirónsalud) by Fresenius Helios. In the event of an utilization of the brigde fi nancing facility, it is planned to refi nance the facility with long-term fi nancial instruments in due course.

SUBSEQUENT EVENTS

On October 14, 2016, the Senior Credit Agreement 2013 has been increased by an incremental term loan A of € 900 million and an incremental revolving facility of € 300 million. The incremental facilities are used to fund the acquisition of IDC Salud Holding S.L.U. (Quirónsalud) by Fresenius Helios.

There were no further signifi cant changes in the Fresenius Group's operating environment following the end of the third quarter of 2016. No further events of material importance on the assets and liabilities, fi nancial position, and result of operations of the Group have occured after the close of the third quarter of 2016.

OUTLOOK 2016

FRESENIUS GROUP

Based on the Group's excellent fi nancial results and strong prospects for the remainder of the year, Fresenius raises the lower end of its 2016 Group earnings guidance range. The upper end of the Group's earnings guidance remains unchanged, due to the offsetting effect of fi nancing costs related to the Quirónsalud acquisition. Net income 1 , is now expected to grow by 12% to 14% in constant currency. Previously, Fresenius expected net income 1 growth of 11% to 14% in constant currency. The company confi rms its Group sales guidance. Sales are expected to increase by 6% to 8% in constant currency.

The net debt / EBITDA2 ratio is expected to be approximately 2.5 at the end of 2016.

FRESENIUS MEDICAL CARE

Fresenius Medical Care confi rms its outlook for 2016. The company expects sales to grow by 7% to 10% in constant currency. Net income 3 is expected to increase by 15% to 20% 4 .

FRESENIUS KABI

Fresenius Kabi raises its outlook for 2016 and now expects both organic sales growth and EBIT ⁵ growth in constant currency of 4% to 6%. Previously, Fresenius Kabi had projected 3% to 5% for both metrics.

2015 before GranuFlo® / NaturaLyte® settlement costs (- US\$ 37 million after tax) and before acquisitions (US\$ 9 million after tax); hence the basis for expected net income growth is US\$ 1,057 million.

2015 before special items

Net income attributable to shareholders of Fresenius SE & Co. KGaA; 2015 before special items

Calculated at FY average exchange rates for both net debt and EBITDA; excluding potential acquisitions

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

GROUP FINANCIAL OUTLOOK 2016

	Previous guidance	New guidance
Sales, growth (in constant currency)	6% – 8%	confi rmed
Net income 1 , growth (in constant currency)	11% – 14%	12% – 14%

Net income attributable to shareholders of Fresenius SE & Co. KGaA; 2015 before integration costs ( € 12 million before tax for hospitals acquired from Rhön-Klinikum AG), before costs for the effi ciency program at Fresenius Kabi (€ 105 million before tax), and before gain from the divestment of two HELIOS hospitals (€ 34 million before tax)

OUTLOOK 2016 BY BUSINESS SEGMENT

		Previous guidance	New guidance
	Sales growth 1
Fresenius Medical Care	(in constant currency)	7% – 10%	confi rmed
	Net income 1, 2 growth	15% – 20%	confi rmed
Fresenius Kabi	Sales growth (organic)	3% – 5%	4% – 6%
	EBIT 3 (in constant currency)	3% – 5%	4% – 6%
Fresenius Helios	Sales growth (organic)	3% – 5%	confi rmed
	EBIT	€ 670 – 700 m	confi rmed
Fresenius Vamed	Sales growth (organic)	5% – 10%	confi rmed
	EBIT, growth	5% – 10%	confi rmed

Savings from the global effi ciency program are included, while acquisitions 2015 / 2016 are not taken into account. Before settlement costs for the agreement in principle for the GranuFlo® / NaturaLyte® case (-US\$ 37 million after tax) and before acquisitions (US\$ 9 million after tax); hence the basis for net income outlook

2016 are US\$ 1,057 million.

Net income attributable to the shareholders of Fresenius Medical Care AG & Co. KGaA, the outlook is based on current exchange rates 2015 before costs for the effi ciency program at Fresenius Kabi ( € 105 million before tax)

FRESENIUS HELIOS

Fresenius Helios confi rms its outlook for 2016 and projects organic sales growth of 3% to 5%. EBIT is expected to increase to € 670 to € 700 million.

FRESENIUS VAMED

Fresenius Vamed confi rms its outlook for 2016 and expects organic sales growth in the range of 5% to 10% and EBIT growth of 5% to 10%.

INVESTMENTS

The Group plans to invest around 6% of sales in property, plant and equipment.

EMPLOYEES

The number of employees in the Group will continue to rise in the future as a result of the expected expansion. We expect the number of employees to increase to more than 230,000 in 2016 (December 31, 2015: 222,305). The number of employees is expected to increase in all business segments.

RESEARCH AND DEVELOPMENT

Our R & D activities will continue to play a key role in securing the Group's long-term growth through innovations and new therapies. We plan to increase the Group's R & D spending in 2016. About 4% to 5% of our product sales will be reinvested in research and development.

Market-oriented research and development with strict time-to-market management processes is crucial for the success of new products. We continually review our R & D results using clearly defi ned milestones. Innovative ideas, product development, and therapies with a high level of quality will continue to be the basis for future market-leading positions. Given the continued cost-containment efforts in the health care sector, cost effi ciency combined with a strong quality focus is acquiring ever-greater importance in product development, and in the improvement of treatment concepts and therapies.

FRESENIUS SE & CO. KGAA CONSOLIDATED STATEMENT OF INCOME (UNAUDITED)

€ in millions	Q3 / 2016	Q3 / 2015	Q1 – 3 / 2016	Q1 – 3 / 2015
Sales	7,339	6,940	21,345	20,369
Cost of sales	- 5,031	- 4,748	- 14,694	- 14,128
Gross profi t	2,308	2,192	6,651	6,241
Selling, general and administrative expenses	- 1,098	- 1,065	- 3,202	- 3,083
Research and development expenses	- 128	- 114	- 357	- 337
Operating income (EBIT)	1,082	1,013	3,092	2,821
Net interest	- 142	- 146	- 433	- 476
Income before income taxes	940	867	2,659	2,345
Income taxes	- 255	- 258	- 746	- 685
Net income	685	609	1,913	1,660
Less noncontrolling interest	286	252	759	661
Net income attributable to shareholders of Fresenius SE & Co. KGaA	399	357	1,154	999

Earnings per share in €	0.73	0.66	2.11	1.84
Fully diluted earnings per share in €	0.73	0.65	2.10	1.82

The following notes are an integral part of the unaudited condensed interim fi nancial statements.

FRESENIUS SE & CO. KGAA CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (UNAUDITED)

€ in millions	Q3 / 2016	Q3 / 2015	Q1 – 3 / 2016	Q1 – 3 / 2015
Net income	685	609	1,913	1,660
Other comprehensive income (loss)
Foreign currency translation	- 77	- 276	- 255	609
Cash flow hedges	12	14	19	39
Change of fair value of available for sale financial assets	–	–	–	–
Actuarial gains / losses on defined benefit pension plans	7	8	35	- 10
Income taxes related to components of other comprehensive income (loss)	- 5	- 6	- 11	- 28
Other comprehensive income (loss), net	- 63	- 260	- 212	610
Total comprehensive income	622	349	1,701	2,270
Comprehensive income attributable to noncontrolling interest subject to put provisions	35	44	97	156
Comprehensive income attributable to noncontrolling interest not subject to put provisions	191	101	520	892
Comprehensive income attributable to shareholders of Fresenius SE & Co. KGaA	396	204	1,084	1,222

FRESENIUS SE & CO. KGAA CONSOLIDATED STATEMENT OF FINANCIAL POSITION (UNAUDITED)

ASSETS

€ in millions	September 30, 2016	December 31, 2015
Cash and cash equivalents	1,185	1,044
Trade accounts receivable, less allowance for doubtful accounts	4,938	4,596
Accounts receivable from and loans to related parties	20	78
Inventories	3,052	2,860
Other current assets	1,940	1,901
I. Total current assets	11,135	10,479
Property, plant and equipment	7,730	7,428
Goodwill	21,633	21,523
Other intangible assets	1,467	1,510
Other non-current assets	1,547	1,479
Deferred taxes	563	540
II. Total non-current assets	32,940	32,480
Total assets	44,075	42,959

LIABILITIES AND SHAREHOLDERS' EQUITY

€ in millions	September 30, 2016	December 31, 2015
Trade accounts payable	1,040	1,291
Short-term accounts payable to related parties	79	9
Short-term accrued expenses and other short-term liabilities	4,947	4,691
Short-term debt	966	202
Short-term debt from related parties	–	4
Current portion of long-term debt and capital lease obligations	609	607
Current portion of Senior Notes	547	349
Short-term accruals for income taxes	262	195
A. Total short-term liabilities	8,450	7,348
Long-term debt and capital lease obligations, less current portion	4,833	5,502
Senior Notes, less current portion	6,725	7,267
Convertible bonds	850	838
Long-term accrued expenses and other long-term liabilities	1,031	955
Pension liabilities	1,024	1,078
Long-term accruals for income taxes	208	221
Deferred taxes	770	800
B. Total long-term liabilities	15,441	16,661
I. Total liabilities	23,891	24,009
II. Noncontrolling interest subject to put provisions	1,098	947
A. Noncontrolling interest not subject to put provisions	7,341	7,068
Subscribed capital	547	546
Capital reserve	3,120	3,095
Other reserves	7,868	7,014
Accumulated other comprehensive income	210	280
B. Total Fresenius SE & Co. KGaA shareholders' equity	11,745	10,935
III. Total shareholders' equity	19,086	18,003
Total liabilities and shareholders' equity	44,075	42,959

FRESENIUS SE & CO. KGAA CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED)

€ in millions	Q1 – 3 / 2016	Q1 – 3 / 2015
Operating activities
Net income	1,913	1,660
Adjustments to reconcile net income to cash and cash equivalents provided by operating activities
Depreciation and amortization	857	825
Gain on sale of investments and divestitures	- 3	- 39
Change in deferred taxes	- 39	- 85
Gain / loss on sale of fixed assets	- 1	–
Changes in assets and liabilities, net of amounts from businesses acquired or disposed of
Trade accounts receivable, net	- 350	- 376
Inventories	- 210	- 375
Other current and non-current assets	- 79	199
Accounts receivable from / payable to related parties	65	83
Trade accounts payable, accrued expenses and other short-term and long-term liabilities	63	306
Accruals for income taxes	43	- 47
Net cash provided by operating activities	2,259	2,151
Investing activities
Purchase of property, plant and equipment	- 1,072	- 950
Proceeds from sales of property, plant and equipment	20	18
Acquisitions and investments, net of cash acquired and net purchases of intangible assets	- 478	- 239
Proceeds from sale of investments and divestitures	174	176
Net cash used in investing activities	- 1,356	- 995
Financing activities
Proceeds from short-term debt	952	504
Repayments of short-term debt	- 197	- 275
Proceeds from long-term debt and capital lease obligations	374	354
Repayments of long-term debt and capital lease obligations	- 1,023	- 996
Proceeds from the issuance of Senior Notes	0	269
Repayments of liabilities from Senior Notes	- 250	- 729
Changes of accounts receivable securitization program	- 46	- 41
Proceeds from the exercise of stock options	67	132
Dividends paid	- 650	- 582
Change in noncontrolling interest	–	- 4
Exchange rate effect due to corporate financing	5	- 5
Net cash used in fi nancing activities	- 768	- 1,373
Effect of exchange rate changes on cash and cash equivalents	6	17
Net increase / decrease in cash and cash equivalents	141	- 200
Cash and cash equivalents at the beginning of the reporting period	1,044	1,175
Cash and cash equivalents at the end of the reporting period	1,185	975

FRESENIUS SE & CO. KGAA CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (UNAUDITED)

		Subscribed Capital		Reserves
	Number of ordinary shares in thousand	Amount € in thousands	Amount € in millions	Capital reserve € in millions	Other reserves € in millions
As of December 31, 2014	541,533	541,533	542	3,018	5,894
Proceeds from the exercise of stock options	3,467	3,467	3	87
Compensation expense related to stock options				13
Vested subsidiary stock incentive plans				- 1
Dividends paid					- 238
Purchase of noncontrolling interest not subject to put provisions
Noncontrolling interest subject to put provisions				- 37
Comprehensive income (loss)
Net income					999
Other comprehensive income (loss)
Cash flow hedges
Change of fair value of available for sale financial assets
Foreign currency translation
Actuarial losses on defined benefit pension plans
Comprehensive income					999
As of September 30, 2015	545,000	545,000	545	3,080	6,655
As of December 31, 2015	545,728	545,728	546	3,095	7,014
Proceeds from the exercise of stock options	1,205	1,205	1	37
Compensation expense related to stock options				21
Vested subsidiary stock incentive plans				- 1
Dividends paid					- 300
Purchase of noncontrolling interest not subject to put provisions
Noncontrolling interest subject to put provisions				- 32
Comprehensive income (loss)
Net income					1,154
Other comprehensive income (loss)
Cash flow hedges
Change of fair value of available for sale financial assets
Foreign currency translation
Actuarial gains on defined benefit pension plans
Comprehensive income (loss)					1,154
As of September 30, 2016	546,933	546,933	547	3,120	7,868

FRESENIUS SE & CO. KGAA CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (UNAUDITED)

	Accumulated other com prehensive income (loss) € in millions	Total Fresenius SE & Co. KGaA shareholders' equity € in millions	Non controlling interest not subject to put provisions € in millions	Total shareholders' equity € in millions
As of December 31, 2014	- 119	9,335	6,148	15,483
Proceeds from the exercise of stock options		90	42	132
Compensation expense related to stock options		13	4	17
Vested subsidiary stock incentive plans		- 1	- 1	- 2
Dividends paid		- 238	- 237	- 475
Purchase of noncontrolling interest not subject to put provisions		0	19	19
Noncontrolling interest subject to put provisions		- 37	- 81	- 118
Comprehensive income (loss)
Net income		999	560	1,559
Other comprehensive income (loss)
Cash flow hedges	15	15	14	29
Change of fair value of available for sale financial assets	–	–	–	–
Foreign currency translation	212	212	321	533
Actuarial losses on defined
benefit pension plans	- 4	- 4	- 3	- 7
Comprehensive income	223	1,222	892	2,114
As of September 30, 2015	104	10,384	6,786	17,170
As of December 31, 2015	280	10,935	7,068	18,003
Proceeds from the exercise of stock options		38	29	67
Compensation expense related to stock options		21	16	37
Vested subsidiary stock incentive plans		- 1	- 2	- 3
Dividends paid		- 300	- 230	- 530
Purchase of noncontrolling interest not subject to put provisions		0	8	8
Noncontrolling interest subject to put provisions		- 32	- 68	- 100
Comprehensive income (loss) Net income		1,154	640	1,794
Other comprehensive income (loss)
Cash flow hedges	2	2	10	12
Change of fair value of available for sale financial assets	–	–	–	–
Foreign currency translation	- 83	- 83	- 143	- 226
Actuarial gains on defined benefit pension plans	11	11	13	24
Comprehensive income (loss)	- 70	1,084	520	1,604
As of September 30, 2016	210	11,745	7,341	19,086

Change 5% 5% 8% 4% 10% 9% - 9% 16% - 1% 3% - 2% 10% 118% 6% 4% 2015 20,369 20,369 0 3,646 825 - 476 - 685 999 1,219 950 272 337 222,305 18.0% 2,3 14.0% 2,3 10.1% 6 100% 4.1% 10.6% 2,821 2,151 42,959 14,769 1,154 1,044 2016 21,345 21,345 0 3,949 857 3,092 - 433 - 746 2,259 1,207 44,075 14,530 592 357 231,432 10.3%5 100% 18.5% 14.5% 4.0% 10.6% 85% Change - 4% - 25% - 2% 68% 14% 55% 36% - 88% - 15% 78% - 15% - 174% - 33% 100% 4 - 100% 7% 2015 4 4 - 40 - 54 6 - 8 878 - 78 - 82 0% 7 - 47 - 22 25 - 47 - 491 150 - 152 2016 3 - 84 - 13 8 - 14 3 - 567 - 7 - 12 - 175 4 0 0 942 0% - 81 - 21 - 111 150% Change 1% 1% - 3% 3% 0% 3% 50% - 14% 5% 131% 1% 16% - 33% 4 - 100% - 2% - 44 2015 30 38 8 30 - 2 - 7 20 - 52 9 0 8,262 3% 5.2% 4.1% 1.1% - 6.0% 11.1% 731 701 988 161 – 2016 740 29 39 8 - 8 22 16 995 187 6 0 8,076 3% 5.3% 4.2% 1.1% 3.0% 9.8% 711 31 - 1 21 13% Change -- 5% 5% 6% 2% 7% 22% 3% 14% 5% 3% 3% 26% 14% 4% – 2015 3 4,167 4,167 0 140 - 36 - 78 386 248 29 69,728 20% 612 472 352 142 14.7% 11.3% 3.4% 9.3% 8.1% 8,430 1,282 2016 4,382 4,382 0 650 143 507 - 28 - 76 402 437 8,694 1,325 179 33 – 72,246 21% 14.8% 11.6% 3.3% 10.0% 8.4% 261 10% Change -- 1% 1% 12% 4% - 2% 5% 21% - 7% 11% 15% 3% - 1% - 13% 2% 4% 2015 2 34 - 144 4,397 22% 1,060 188 872 - 228 479 589 212 37 243 33,195 23.9% 19.7% 4.2% 13.3% 13.2% 4,431 381 5,234 10,395 2016 4,457 4,419 38 916 - 114 646 438 10,676 5,168 114 249 34,394 21% 185 - 243 532 185 24.7% 20.6% 4.2% 14.5% 12.9% 1,101 - 8% Change 7% 7% - 6% 10% 6% 11% - 1% - 6% 20% - 28% 3% 0% 15% 112% 20% 5% 2015 11,118 11,100 18 1,976 482 1,494 - 272 - 397 639 1,267 696 210 90 110,242 55% 17.8% 13.4% 4.3% 11.4% 9.6% 581 23,298 7,942 504 115,774 2016 11,847 11,830 17 2,172 513 1,659 - 276 - 422 766 23,885 670 445 108 55% 18.3% 14.0% 4.3% 9.8% 10.1% 1,161 7,961 shareholders of Fresenius SE & Co. KGaA contribution to consolidated sales Operating cash flow in % of sales Research and development expenses by business segment, € in millions (per capita on balance sheet date) 1 Depreciation and amortization Acquisitions, gross / investments thereof intercompany sales Depreciation and amortization Cash fl ow before acquisitions Net income attributable to thereof contribution to Capital expenditure, gross consolidated sales Operating cash fl ow EBITDA margin in % of sales EBIT margin and dividends Income taxes Total assets 1 Net interest Key fi gures ROOA 1 Employees EBITDA Debt 1 Sales EBIT		Fresenius Medical Care		Fresenius Kabi		Fresenius Helios		Fresenius Vamed		Corporate / Other		Fresenius Group











													5%

CONSOLIDATED SEGMENT REPORTING FIRST THREE QUARTERS (UNAUDITED)

FRESENIUS SE & CO. KGAA

1 2015: December 31

2 Before costs for the effi ciency program

3 Before integration costs and disposal gains (two HELIOS hospitals) 4 After costs for the effi ciency program, integration costs and disposal gains (two HELIOS hospitals)

5 The underlying pro forma EBIT does not include costs for the effi ciency program.

6 The underlying EBIT does not include costs for the effi ciency program, integration costs and disposal gains (two HELIOS hospitals).

The consolidated segment reporting is an integral part of the notes. The following notes are an integral part of the unaudited condensed interim fi nancial statements.

N ME G D SE ATE D OLI NS CO	T REP	RTI O	G THI N	RD Q	U	ARTE	N R (U	DI AU	D) TE
		Fresenius Medical Care			Fresenius Kabi			Fresenius Helios			Fresenius Vamed			Corporate / Other			Fresenius Group
by business segment, € in millions	2016	2015	Change	2016	2015 1	Change	2016	2015 2	Change	2016	2015	Change	2016	2015 3	Change	2016	2015	Change
Sales	4,117	3,806	8%	1,511	1,499	1%	1,470	1,393	6%	268	268	0%	- 27	- 26	- 4%	7,339	6,940	6%
thereof contribution to consolidated sales	4,112	3,800	8%	1,498	1,488	1%	1,470	1,393	6%	258	258	0%	1	1	0%	7,339	6,940	6%
thereof intercompany sales	5	6	- 17%	13	11	18%	0	0		10	10	0%	- 28	- 27	- 4%	0	0
contribution to consolidated sales	56%	55%		20%	21%		20%	20%		4%	4%		0%	0%		100%	100%
EBITDA	776	714	9%	361	369	- 2%	223	213	5%	18	17	6%	- 5	- 17	71%	1,373	1,296	6%
Depreciation and amortization	176	162	9%	61	68	- 10%	48	48	0%	3	3	0%	3	2	50%	291	283	3%
EBIT	600	552	9%	300	301	0%	175	165	6%	15	14	7%	- 8	- 19	58%	1,082	1,013	7%
Net interest	- 90	- 89	- 1%	- 37	- 42	12%	- 8	- 11	27%	- 1	0		- 6	- 4	- 50%	- 142	- 146	3%
Income taxes	- 147	- 152	3%	- 80	- 82	2%	- 27	- 26	- 4%	- 4	- 3	- 33%	3	5	- 40%	- 255	- 258	1%
shareholders of Fresenius SE & Co. KGaA Net income attributable to	298	235	27%	173	170	2%	140	126	11%	10	10	0%	- 222	- 184	- 21%	399	357	12%

Operating cash fl ow	393	521	- 25%	311	235	32%	207	155	34%	21	0		- 3	- 11	73%	929	900	3%
Cash fl ow before acquisitions and dividends	182	319	- 43%	228	171	33%	133	98	36%	19	- 1	--	- 5	- 14	64%	557	573	- 3%

Capital expenditure, gross	216	207	4%	80	71	13%	74	58	28%	2	2	0%	2	1	100%	374	339	10%
Acquisitions, gross / investments	80	73	10%	3	1	200%	5	1	--	0		4 - 100%	- 1	- 1	0%	87	78	12%

Research and development expenses	40	31	29%	88	82	7%	–	–	--	0	0		0	1	- 100%	128	114	12%

Key fi gures
EBITDA margin	18.8%	18.7%		23.9%	24.6%		15.2%	15.3%		6.7%	6.3%					18.7%	18.9% 1,2
EBIT margin	14.6%	14.5%		19.9%	20.1%		11.9%	11.8%		5.6%	5.2%					14.7%	14.8% 1,2
Depreciation and amortization in % of sales	4.3%	4.3%		4.0%	4.5%		3.3%	3.4%		1.1%	1.1%					4.0%	4.1%

FRESENIUS SE & CO. KGAA

1 Before costs for the effi ciency program 2 Before integration costs 3 After costs for the effi ciency program and integration costs

The consolidated segment reporting is an integral part of the notes. The following notes are an integral part of the unaudited condensed interim fi nancial statements.

Operating cash flow in % of sales 9.5% 13.7% 20.6% 15.7% 14.1% 11.1% 7.8% 0.0% 12.7% 13.0%

TABLE OF CONTENTS NOTES

28 General notes

28 1. Principles
28 I. Group structure
28 II. Basis of presentation
28 III. Summary of signifi cant accounting policies
29 IV. Recent pronouncements, applied
29 V. Recent pronouncements, not yet applied
30 2. Acquisitions and investments

31 Notes on the consolidated statement of income

31 3. Sales
31 4. Taxes
31 5. Earnings per share

31 Notes on the consolidated statement of fi nancial position

31 6. Cash and cash equivalents
31 7. Trade accounts receivable
31 8. Inventories
32 9. Other current and non-current assets
32 10. Goodwill and other intangible assets
33 11. Debt and capital lease obligations
36 12. Senior Notes
37 13. Convertible bonds
37 14. Pensions and similar obligations
38 15. Noncontrolling interest
38 16. Fresenius SE & Co. KGaA shareholders' equity
40 17. Other comprehensive income (loss)

41 Other notes

41 18. Legal and regulatory matters
43 19. Financial instruments
46 20. Supplementary information on capital management
46 21. Supplementary information on the consolidated statement of cash fl ows
46 22. Notes on the consolidated segment reporting
47 23. Stock options
49 24. Related party transactions
49 25. Subsequent events
49 26. Corporate Governance

GENERAL NOTES

1. PRINCIPLES

I. GROUP STRUCTURE

Fresenius is a global healthcare group with products and services for dialysis, hospitals and outpatient medical care. In addition, the Fresenius Group focuses on hospi tal operations and also manages projects and provides services for hospitals and other healthcare facilities worldwide. Besides the activities of the parent company Fresenius SE & Co. KGaA, Bad Homburg v. d. H., the operating activities were split into the following legally independent business segments as of September 30, 2016:

▶ Fresenius Medical Care
▶ Fresenius Kabi
▶ Fresenius Helios
▶ Fresenius Vamed

The reporting currency in the Fresenius Group is the euro. In order to make the presentation clearer, amounts are mostly shown in million euros. Amounts under € 1 million after rounding are marked with "–".

II. BASIS OF PRESENTATION

The accompanying condensed consolidated fi nancial statements have been prepared in accordance with the United States Generally Accepted Accounting Principles (U.S. GAAP).

Fresenius SE & Co. KGaA, as a stock exchange listed company with a domicile in a member state of the European Union, fulfi lls its obligation to prepare and publish the consolidated fi nancial statements in accordance with the International Financial Reporting Standards (IFRS) applying Section 315a of the German Commercial Code (HGB). Simultaneously, the Fresenius Group voluntarily prepares and publishes the consolidated fi nancial statements in accordance with U.S. GAAP.

The accounting policies underlying these interim fi nancial statements are mainly the same as those applied in the consolidated fi nancial statements as of December 31, 2015.

III. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Principles of consolidation

The condensed consolidated fi nancial statements and management report for the fi rst three quarters and the third quarter ended September 30, 2016 have not been audited nor reviewed and should be read in conjunction with the notes included in the consolidated fi nancial statements as of December 31, 2015, published in the 2015 Annual Report.

Except for the reported acquisitions (see note 2, Acquisitions and investments), there have been no other major changes in the entities consolidated.

The consolidated fi nancial statements for the fi rst three quarters and the third quarter ended September 30, 2016 include all adjustments that, in the opinion of the Management Board, are of a normal and recurring nature and are necessary to provide an appropriate view of the assets and liabilities, fi nancial position and results of operations of the Fresenius Group.

The results of operations for the fi rst three quarters ended September 30, 2016 are not necessarily indicative of the results of operations for the fi scal year 2016.

Classifi cations

Certain items in the prior year's comparative consolidated fi nancial statements have been adjusted to conform to the current year's presentation. Deferred taxes which were classifi ed as current at December 31, 2015, were reclassifi ed to non-current as of January 1, 2016 in accordance with Accounting Standards Update 2015-17, Financial Accounting Standards Board Accounting Standards Codifi cation Topic 740, Income Taxes – Balance Sheet Classifi cation of Deferred Taxes.

Use of estimates

The preparation of consolidated fi nancial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated fi nancial statements and the reported amounts of income and expenses during the reporting period. Actual results could differ from those estimates.

IV. RECENT PRONOUNCEMENTS, APPLIED

The Fresenius Group has prepared its consolidated fi nancial statements at September 30, 2016 in conformity with U.S. GAAP in force for interim periods on January 1, 2016.

The Fresenius Group applied the following standards, as far as they are relevant for Fresenius Group's business, for the fi rst time:

In November 2015, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update 2015-17 (ASU 2015-17), FASB Accounting Standards Codifi cation (ASC) Topic 740, Income Taxes – Balance Sheet Classifi cation of Deferred Taxes, which focuses on reducing the complexity of classifying deferred taxes on the balance sheet. ASU 2015-17 elim inates the current requirement for organizations to present deferred tax liabilities and assets as current and noncurrent in a classifi ed balance sheet and requires the classifi cation of all deferred tax assets and liabilities as non-current. The update is effective for fi scal years and interim periods within those years beginning after December 15, 2016. Earlier adoption is permitted. The Fresenius Group has elected to early adopt this ASU as of March 31, 2016. In accordance with ASU 2015-17, deferred taxes recorded as of December 31, 2015 within current assets and liabilities have been reclassifi ed to non-current assets and liabilities in the amount of € 438 million and € 61 million, respectively. As a result of deferred tax netting, non-current assets and liabilities were then adjusted in the amount of € 211 million.

In February 2015, the FASB issued Accounting Standards Update 2015-02 (ASU 2015-02), FASB ASC Topic 810, Consolidation – Amendments to the Consolidation Analysis, which focuses on clarifying guidance related to the evaluation of various types of legal entities such as limited partnerships, limited liability corporations and certain security transactions for consolidation. The update is effective for fi scal years and interim periods within those years beginning after December 15, 2015. The Fresenius Group adopted ASU 2015-02 as of March 31, 2016 and will prospectively adjust its disclosures in the consolidated fi nancial statements as of December 31, 2016 to align with the update.

V. RECENT PRONOUNCEMENTS, NOT YET APPLIED The FASB issued the following relevant new standards for the Fresenius Group:

In June 2016, the FASB issued Accounting Standards Update 2016-13 (ASU 2016-13), FASB ASC Topic 326, Financial Instruments – Credit Losses: Measurement of Credit Losses on Financial Instruments. ASU 2016-13 amends guidance on reporting credit losses for assets held at amortized cost basis and available for sale fi nancial assets. The updates are effective for fi scal years and interim periods within those years beginning after December 15, 2020. Early adoption is permitted as of the fi scal years beginning after December 15, 2018, including interim periods within those fi scal years. The Fresenius Group is currently evaluating the impact of ASU 2016-13 on its consolidated fi nancial statements.

In March 2016, the FASB issued Accounting Standards Update 2016-09 (ASU 2016-09), FASB ASC Topic 718, Compensation – Stock Compensation: Improvements to Employee Share-Based Payment Accounting. ASU 2016-09 provides for simplifi cation and clarity of guidance with regard to share-based income tax consequences, classifi cation of awards as equity or liabilities as well as cash fl ow impacts. The updates are effective for fi scal years and interim periods within those years beginning after December 15, 2016. Early adoption is permitted. The Fresenius Group is currently evaluating the impact of ASU 2016-09 on its consolidated fi nancial statements.

In February 2016, the FASB issued Accounting Standards Update 2016-02 (ASU 2016-02), FASB ASC Subtopic 842, Leases. ASU 2016-02 is expected to increase transparency and comparability by recognizing lease assets and lease liabilities from lessees on the balance sheet and disclosing key information about leasing arrangements in the fi nancial statements. The lessor accounting is largely unchanged. The updates are effective for fi scal years and interim periods within those years beginning after December 15, 2018. Early applications of the amendments in these updates are permitted. The Fresenius Group is currently evaluating the impact of ASU 2016-02 on its consolidated fi nancial statements.

In January 2016, the FASB issued Accounting Standards Update 2016-01 (ASU 2016-01), FASB ASC Subtopic 825-10, Financial Instruments – Overall: Recognition and Measurement of Financial Assets and Financial Liabilities. ASU 2016-01 focuses on improving the recognition and measurement of fi nancial instruments to provide users of fi nancial statements with more decision-useful information. ASU 2016-01 affects the accounting treatment and disclosures related to fi nancial instruments and equity instruments. The update is effective for fi scal years and interim periods within those years beginning after December 15, 2017. Earlier adoption is gen erally not permitted. The Fresenius Group is currently evaluating the impact of ASU 2016-01 on its consolidated fi nancial statements.

In May 2014, the FASB issued Accounting Standards Update 2014-09 (ASU 2014-09), FASB ASC Topic 606, Revenue from Contracts with Customers. Simultaneously, the Inter national Accounting Standards Board (IASB) published its equivalent revenue standard, IFRS 15, Revenue from Contracts with Customers. The standards are the result of a convergence project between the FASB and the IASB. This update specifi es how and when companies reporting under U.S. GAAP will recognize revenue as well as providing users of fi nancial statements with more informative and relevant disclosures. ASU 2014-09 supersedes some guidance included in Topic 605, Revenue Recognition, some guidance within the scope of Topic 360, Property, Plant, and Equipment, and some guidance within the scope of Topic 350, Intan gibles – Goodwill and Other. This ASU applies to nearly all contracts with customers, unless those contracts are within the scope of other standards (for example, lease contracts or insurance contracts). With the issuance of Accounting Standards Update 2015-14 (ASU 2015-14), FASB ASC Topic 606, Revenue from Contracts with Customers: Deferral of the Effective Date, in August 2015, the effective date of ASU 2014-09 for public business entities, among others, was deferred from fi scal years and interim periods within those years beginning after December 15, 2016 to fi scal years and interim periods within those years beginning after December 15, 2017. Earlier adoption is permitted. The Fresenius Group is currently evaluating the impact of ASU 2014-09, in conjunction with all amendments, on its consolidated fi nancial statements.

2. ACQUISITIONS AND INVESTMENTS

The Fresenius Group made acquisitions, investments and purchases of intangible assets of € 592 million and € 272 million in the fi rst three quarters of 2016 and 2015, respectively. Of this amount, € 478 million was paid in cash and € 114 million was assumed obligations in the fi rst three quarters of 2016.

FRESENIUS MEDICAL CARE

In the fi rst three quarters of 2016, Fresenius Medical Care spent € 445 million on acquisitions, mainly on acquisitions of dialysis clinics as well as in care coordination.

FRESENIUS KABI

In the fi rst three quarters of 2016, Fresenius Kabi spent € 114 million on acquisitions including the acquisition of a U.S. pharmaceutical manufacturing plant and a line of seven drugs.

FRESENIUS HELIOS

In the fi rst three quarters of 2016, Fresenius Helios spent € 33 million on acquisitions, mainly for the purchase of 100% of the shares in Klinikum Niederberg gGmbH, Germany and for the purchase of outpatient clinics.

Acquisition of IDC Salud Holding S.L.U. (Quirónsalud)

On September 5, 2016, Fresenius Helios announced the signing of a purchase agreement to acquire 100% of the share capital in IDC Salud Holding S.L.U. (Quirónsalud), Spain, for a total purchase price of € 5.76 billion. Sellers are the private equity group CVC Capital Partners, Víctor Madera, founder and CEO of Quirónsalud, and other members of Quirónsalud's management board. Quirónsalud, Spain's largest private hospital operator covers the full spectrum of inpatient and outpatient care. The transaction is expected to be closed in the fi rst quarter of 2017 after approval by the anti trust authorities. € 5.36 billion of the total purchase price will be debtfi nanced and the remaining € 400 million will be fi nanced through the issuance of 6,108,176 shares by Fresenius SE & Co. KGaA to Víctor Madera.

NOTES ON THE CONSOLIDATED STATEMENT OF INCOME

3. SALES

Sales by activity were as follows:

€ in millions	Q1 – 3 / 2016	Q1 – 3 / 2015
Sales of services	14,706	13,759
less patient service bad debt provision	- 306	- 287
Sales of products and related goods	6,613	6,553
Sales from long-term production contracts	327	338
Other sales	5	6
Sales	21,345	20,369

4. TAXES

In the third quarter of 2016, Fresenius Medical Care released tax liabilities due to tax audit settlements with the tax authorities.

During the fi rst three quarters of 2016, there were no further material changes relating to tax audits, accruals for income taxes, unrecognized tax benefi ts as well as recognized and accrued payments for interest and penalties. Explanations regarding the tax audits and further information can be found in the consolidated fi nancial statements in the 2015 Annual Report.

5. EARNINGS PER SHARE

The following table shows the earnings per share including and excluding the dilutive effect from stock options issued:

	Q1 – 3 / 2016	Q1 – 3 / 2015
Numerators, € in millions
Net income attributable to
shareholders of
Fresenius SE & Co. KGaA	1,154	999
less effect from dilution due to
Fresenius Medical Care shares	–	–
Income available to
all ordinary shares	1,154	999
Denominators in number of shares
Weighted-average number of
ordinary shares outstanding	546,179,291	543,366,248
Potentially dilutive
ordinary shares	3,776,244	4,562,590
Weighted-average number
of ordinary shares outstanding
assuming dilution	549,955,535	547,928,838

Basic earnings per share in €	2.11	1.84
Fully diluted earnings per share in €	2.10	1.82

NOTES ON THE CONSOLIDATED STATEMENT OF FINANCIAL POSITION

6. CASH AND CASH EQUIVALENTS

As of September 30, 2016 and December 31, 2015, cash and cash equivalents were as follows:

€ in millions	Sept. 30, 2016	Dec. 31, 2015
Cash	1,163	992
Time deposits and securities (with a maturity of up to 90 days)	22	52
Total cash and cash equivalents	1,185	1,044

As of September 30, 2016 and December 31, 2015, earmarked funds of € 76 million and € 57 million, respectively, were included in cash and cash equivalents.

7. TRADE ACCOUNTS RECEIVABLE

As of September 30, 2016 and December 31, 2015, trade accounts receivable were as follows:

€ in millions	Sept. 30, 2016	Dec. 31, 2015
Trade accounts receivable	5,672	5,246
less allowance for doubtful accounts	734	650
Trade accounts receivable, net	4,938	4,596

8. INVENTORIES

As of September 30, 2016 and December 31, 2015, inventories consisted of the following:

€ in millions	Sept. 30, 2016	Dec. 31, 2015
Raw materials and purchased components	661	602
Work in process	591	526
Finished goods	1,939	1,839
less reserves	139	107
Inventories, net	3,052	2,860

9. OTHER CURRENT AND NON-CURRENT ASSETS

As of September 30, 2016, investments were comprised of investments of € 636 million (December 31, 2015: € 592 million), mainly regarding the joint venture between Fresenius Medical Care and Galenica Ltd., that were accounted for under the equity method. In the fi rst three quarters of 2016, income of € 55 million (Q1 – 3 / 2015: € 20 million) resulting from this valuation was included in selling, general and

administrative expenses in the consolidated statement of income. Securities and long-term loans included € 258 million fi nancial assets available for sale as of September 30, 2016 (December 31, 2015: € 257 million) mainly relating to shares in funds.

10. GOODWILL AND OTHER INTANGIBLE ASSETS

As of September 30, 2016 and December 31, 2015, intangible assets, split into amortizable and non-amortizable intangible assets, consisted of the following:

AMORTIZABLE INTANGIBLE ASSETS

		September 30, 2016			December 31, 2015
€ in millions	Acquisition cost	Accumulated amortization	Carrying amount	Acquisition cost	Accumulated amortization	Carrying amount
Patents, product and distribution rights	714	368	346	713	356	357
Technology	374	127	247	383	111	272
Customer relationships	332	85	247	324	61	263
Software	456	282	174	406	248	158
Non-compete agreements	326	258	68	322	251	71
Other	433	267	166	414	252	162
Total	2,635	1,387	1,248	2,562	1,279	1,283

Estimated regular amortization expenses of intangible assets for the next fi ve years are shown in the following table:

€ in millions	Q4 / 2016	2017	2018	2019	2020	Q1 – 3 / 2021
Estimated amortization expenses	49	181	175	171	162	121

NON-AMORTIZABLE INTANGIBLE ASSETS

		September 30, 2016			December 31, 2015
€ in millions	Acquisition cost	Accumulated amortization	Carrying amount	Acquisition cost	Accumulated amortization	Carrying amount
Tradenames	216	0	216	221	0	221
Management contracts	3	0	3	6	0	6
Goodwill	21,633	0	21,633	21,523	0	21,523
Total	21,852	0	21,852	21,750	0	21,750

The carrying amount of goodwill has developed as follows:

€ in millions	Fresenius Medical Care	Fresenius Kabi	Fresenius Helios	Fresenius Vamed	Corporate / Other	Fresenius Group
Carrying amount as of January 1, 2015	10,775	4,601	4,387	99	6	19,868
Additions	105	27	57	–	0	189
Disposals	0	- 1	0	0	0	- 1
Reclassifi cations	0	2	0	0	0	2
Foreign currency translation	1,091	374	0	0	0	1,465
Carrying amount as of December 31, 2015	11,971	5,003	4,444	99	6	21,523
Additions	335	5	74	0	0	414
Reclassifi cations	3	0	0	0	0	3
Foreign currency translation	- 224	- 83	0	0	0	- 307
Carrying amount as of September 30, 2016	12,085	4,925	4,518	99	6	21,633

As of September 30, 2016 and December 31, 2015, the carrying amounts of the other non-amortizable intangible assets were € 191 million and € 198 million, respectively, for Fresenius Medical Care as well as € 28 million and € 29 million, respectively, for Fresenius Kabi.

11. DEBT AND CAPITAL LEASE OBLIGATIONS

SHORT-TERM DEBT

As of September 30, 2016 and December 31, 2015, shortterm debt consisted of the following:

		Book value
€ in millions	Sept. 30, 2016	December 31, 2015
Fresenius SE & Co. KGaA Commercial Paper	190	0
Fresenius Medical Care AG & Co. KGaA Commercial Paper	550	0
Other short-term debt	226	202
Short-term debt	966	202

LONG-TERM DEBT AND CAPITAL LEASE OBLIGATIONS

As of September 30, 2016 and December 31, 2015, long-term debt and capital lease obligations net of debt issuance costs consisted of the following:

	Book value
€ in millions	September 30, 2016	December 31, 2015
Fresenius Medical Care 2012 Credit Agreement	2,186	2,399
2013 Senior Credit Agreement	1,588	2,203
Schuldschein Loans	1,164	914
Accounts Receivable Facility of Fresenius Medical Care	0	46
Capital lease obligations	155	151
Other	349	396
Subtotal	5,442	6,109
less current portion	609	607
Long-term debt and capital lease obligations, less current portion	4,833	5,502

Fresenius Medical Care 2012 Credit Agreement Fresenius Medical Care AG & Co. KGaA (FMC-AG & Co. KGaA) originally entered into a syndicated credit facility ( Fresenius Medical Care 2012 Credit Agreement) of US\$ 3,850 million and a 5-year period with a large group of banks and institutional investors on October 30, 2012.

On November 26, 2014, the Fresenius Medical Care 2012 Credit Agreement was amended to increase the total credit facility to approximately US\$ 4,400 million and extend the term for an additional two years until October 30, 2019.

The following tables show the available and outstanding amounts under the Fresenius Medical Care 2012 Credit Agreement after scheduled amortization payments at September 30, 2016 and at December 31, 2015:

	September 30, 2016
	Maximum amount available
	€ in millions		€ in millions
US\$ 1,000 million	896	US\$13 million	12
€ 400 million	400	€ 0 million	0
US\$ 2,150 million	1,926	US\$2,150 million	1,926
€ 258 million	258	€ 258 million	258
	3,480		2,196
			10
			2,186
			Balance outstanding

December 31, 2015

		Maximum amount available		Balance outstanding
		€ in millions		€ in millions
Revolving Credit (in US\$)	US\$ 1,000 million	918	US\$25 million	23
Revolving Credit (in €)	€ 400 million	400	€ 0 million	0
US\$ Term Loan	US\$ 2,300 million	2,113	US\$2,300 million	2,113
€ Term Loan	€ 276 million	276	€ 276 million	276
Total		3,707		2,412
less fi nancing cost				13
Total				2,399

At September 30, 2016 and December 31, 2015, Fresenius Medical Care had letters of credit outstanding in the amount of US\$ 4 million under the U.S. dollar revolving credit facility, which were not included above as part of the balance outstanding at those dates but which reduce available borrowings under the applicable revolving credit facility.

As of September 30, 2016, FMC-AG & Co. KGaA and its subsidiaries were in compliance with all covenants under the Fresenius Medical Care 2012 Credit Agreement.

2013 Senior Credit Agreement

On December 20, 2012, Fresenius SE & Co. KGaA and various subsidiaries entered into a delayed draw syndicated credit agreement (2013 Senior Credit Agreement) in the original amount of US\$ 1,300 million and € 1,250 million. Since the initial funding of the 2013 Senior Credit Agreement in June 2013, additional tranches were added. Furthermore, scheduled amortization payments as well as voluntary repayments have been made. On February 29, 2016, a Term Loan B of US\$ 489 million was voluntarily prepaid.

The following tables show the available and outstanding amounts under the 2013 Senior Credit Agreement at September 30, 2016 and at December 31, 2015:

	September 30, 2016
	Maximum amount available		Balance outstanding
		€ in millions		€ in millions
Revolving Credit Facilities (in €)	€ 900 million	900	€ 0 million	0
Revolving Credit Facilities (in US\$)	US\$ 300 million	269	US\$ 0 million	0
Term Loan A (in €)	€ 964 million	964	€ 964 million	964
Term Loan A (in US\$)	US\$ 712 million	638	US\$ 712 million	638
Total		2,771		1,602
less fi nancing cost				14
Total				1,588

	December 31, 2015
	Maximum amount available		Balance outstanding
		€ in millions		€ in millions
Revolving Credit Facilities (in €)	€ 900 million	900	€ 0 million	0
Revolving Credit Facilities (in US\$)	US\$ 300 million	276	US\$ 0 million	0
Term Loan A (in €)	€ 1,057 million	1,057	€ 1,057 million	1,057
Term Loan A (in US\$)	US\$ 781 million	717	US\$ 781 million	717
Term Loan B (in US\$)	US\$ 489 million	449	US\$ 489 million	449
Total		3,399		2,223
less fi nancing cost				20
Total				2,203

As of September 30, 2016, the Fresenius Group was in com pliance with all covenants under the 2013 Senior Credit Agreement.

Schuldschein Loans

As of September 30, 2016 and December 31, 2015, Schuldschein Loans of the Fresenius Group net of debt issuance costs consisted of the following:

Notional amount Maturity Interest rate Sept. 30, 2016 Fresenius SE & Co. KGaA 2012 / 2016 € 108 million April 4, 2016 3.36% 0 51 Fresenius SE & Co. KGaA 2013 / 2017 € 51 million Aug. 22, 2017 2.65% Fresenius SE & Co. KGaA 2013 / 2017 € 74 million Aug. 22, 2017 variable 74 Fresenius SE & Co. KGaA 2014 / 2018 € 97 million April 2, 2018 2.09% 97 Fresenius SE & Co. KGaA 2014 / 2018 € 76 million April 2, 2018 variable 76 Fresenius SE & Co. KGaA 2014 / 2018 € 65 million April 2, 2018 variable 65
	Dec. 31, 2015
	108
	51
	74
	96
	76
	65
72 Fresenius SE & Co. KGaA 2012 / 2018 € 72 million April 4, 2018 4.09%	72
Fresenius SE & Co. KGaA 2015 / 2018 € 36 million October 8, 2018 1.07% 36	36
Fresenius SE & Co. KGaA 2015 / 2018 € 55 million October 8, 2018 variable 55	55
Fresenius SE & Co. KGaA 2014 / 2020 € 106 million April 2, 2020 2.67% 105	105
Fresenius SE & Co. KGaA 2014 / 2020 € 55 million April 2, 2020 variable 55	55
100 Fresenius SE & Co. KGaA 2014 / 2020 € 101 million April 2, 2020 variable	100
Fresenius SE & Co. KGaA 2015 / 2022 € 21 million April 7, 2022 variable 21	21
Fresenius US Finance II, Inc. 2016 / 2021 US\$ 309 million March 10, 2021 variable 275	0
Fresenius US Finance II, Inc. 2016 / 2021 US\$ 33 million March 10, 2021 2.66% 29	0
Fresenius US Finance II, Inc. 2016 / 2023 US\$ 15 million March 10, 2023 variable 14	0
39 Fresenius US Finance II, Inc. 2016 / 2023 US\$ 43 million March 10, 2023 3.12%	0
Schuldschein Loans 1,164	914

The Schuldschein Loans issued by Fresenius SE & Co. KGaA in the amount of € 108 million, which were due on April 4, 2016, were repaid as scheduled.

On March 10, 2016, Fresenius US Finance II, Inc. issued Schuldschein Loans in a total amount of US\$ 400 million which consist of fi xed and fl oating rate tranches and terms of fi ve and seven years. These Schuldschein Loans are guaranteed by Fresenius SE & Co. KGaA, Fresenius Kabi AG and Fresenius ProServe GmbH.

The Schuldschein Loans issued by Fresenius SE & Co. KGaA in the total amount of € 125 million which are due on August 22, 2017 are shown as current portion of long-term debt and capital lease obligations in the consolidated statement of fi nancial position.

As of September 30, 2016, the Fresenius Group was in compliance with all of its covenants under the Schuldschein Loans.

CREDIT LINES

In addition to the fi nancial liabilities described before, the Fresenius Group maintains additional credit facilities which have not been utilized, or have only been utilized in part, as of the reporting date. At September 30, 2016, the additional fi nancial cushion resulting from unutilized credit facilities was approximately € 3.4 billion. Thereof € 2.5 billion accounted for syndicated credit facilities.

Bridge Financing Facility

In the event of a utilization of the bridge fi nancing facility, it it planned to refi nance the facility with long-term fi nancial instruments in due course.

12. SENIOR NOTES

As of September 30, 2016 and December 31, 2015, Senior Notes of the Fresenius Group net of debt issuance costs consisted of the following:

				Book value € in millions
	Notional amount	Maturity	Interest rate	Sept. 30, 2016	Dec. 31, 2015
Fresenius SE & Co. KGaA 2014 / 2019	€ 300 million	Feb. 1, 2019	2.375%	299	297
Fresenius SE & Co. KGaA 2012 / 2019	€ 500 million	Apr. 15, 2019	4.25%	497	497
Fresenius SE & Co. KGaA 2013 / 2020	€ 500 million	July 15, 2020	2.875%	497	496
Fresenius SE & Co. KGaA 2014 / 2021	€ 450 million	Feb. 1, 2021	3.00%	444	443
Fresenius SE & Co. KGaA 2014 / 2024	€ 450 million	Feb. 1, 2024	4.00%	449	450
Fresenius US Finance II, Inc. 2014 / 2021	US\$ 300 million	Feb. 1, 2021	4.25%	267	275
Fresenius US Finance II, Inc. 2015 / 2023	US\$ 300 million	Jan. 15, 2023	4.50%	266	273
FMC Finance VI S.A. 2010 / 2016	€ 250 million	July 15, 2016	5.50%	0	249
FMC Finance VII S.A. 2011 / 2021	€ 300 million	Feb. 15, 2021	5.25%	295	295
FMC Finance VIII S.A. 2011 / 2016	€ 100 million	Oct. 15, 2016	variable	100	100
FMC Finance VIII S.A. 2011 / 2018	€ 400 million	Sept. 15, 2018	6.50%	397	396
FMC Finance VIII S.A. 2012 / 2019	€ 250 million	July 31, 2019	5.25%	244	244
Fresenius Medical Care US Finance, Inc. 2007 / 2017	US\$ 500 million	July 15, 2017	6.875%	447	457
Fresenius Medical Care US Finance, Inc. 2011 / 2021	US\$ 650 million	Feb. 15, 2021	5.75%	576	590
Fresenius Medical Care US Finance II, Inc. 2011 / 2018	US\$ 400 million	Sept. 15, 2018	6.50%	356	363
Fresenius Medical Care US Finance II, Inc. 2012 / 2019	US\$ 800 million	July 31, 2019	5.625%	714	732
Fresenius Medical Care US Finance II, Inc. 2014 / 2020	US\$ 500 million	Oct. 15, 2020	4.125%	445	456
Fresenius Medical Care US Finance II, Inc. 2012 / 2022	US\$ 700 million	Jan. 31, 2022	5.875%	624	639
Fresenius Medical Care US Finance II, Inc. 2014 / 2024	US\$ 400 million	Oct. 15, 2024	4.75%	355	364
Senior Notes				7,272	7,616

All Senior Notes included in the table are unsecured.

As of July 29, 2016, the original issuer, Fresenius Finance B.V. has been replaced by the successor issuer Fresenius SE & Co. KGaA.

The Senior Notes issued by FMC Finance VI S.A. which were due on July 15, 2016 were repaid as scheduled.

The Senior Notes issued by FMC Finance VIII S.A. which were due on October 15, 2016 and the Senior Notes issued

by Fresenius Medical Care US Finance, Inc. which are due on July 15, 2017 have been reclassifi ed as short-term debt and are shown as current portion of Senior Notes in the consolidated statement of fi nancial position.

As of September 30, 2016, the Fresenius Group was in compliance with all of its covenants under the Senior Notes.

13. CONVERTIBLE BONDS

As of September 30, 2016 and December 31, 2015, the convertible bonds of the Fresenius Group net of debt issuance costs consisted of the following:

						Book value € in millions
	Notional amount	Maturity	Coupon	Current conversion price	Sept. 30, 2016	Dec. 31, 2015
Fresenius SE & Co. KGaA 2014 / 2019	€ 500 million	Sept. 24, 2019	0.000%	€ 49.5184	471	464
Fresenius Medical Care AG & Co. KGaA 2014 / 2020	€ 400 million	Jan. 31, 2020	1.125%	€ 73.6054	379	374
Convertible bonds					850	838

The fair value of the derivative embedded in the convertible bonds of Fresenius SE & Co. KGaA was € 239 million at September 30, 2016. The derivative embedded in the convertible bonds of Fresenius Medical Care AG & Co. KGaA (FMC-AG & Co. KGaA) was recognized with a fair value of € 95 million at September 30, 2016. Fresenius SE & Co. KGaA and FMC-AG & Co. KGaA have purchased stock options (call options) to secure against future fair value fl uctuations of these derivatives. The call options also had an aggregate fair value of € 239 million and € 95 million, respectively, at September 30, 2016.

The conversions will be cash-settled. Any increase of Fresenius' share price and of Fresenius Medical Care's share price above the conversion price would be offset by a corresponding value increase of the call options.

The derivatives embedded in the convertible bonds and the call options are recognized in other non-current liabilities / assets in the consolidated statement of fi nancial position.

14. PENSIONS AND SIMILAR OBLIGATIONS

DEFINED BENEFIT PENSION PLANS

At September 30, 2016, the pension liability of the Fresenius Group was € 1,043 million. The current portion of the pension liability of € 19 million is recognized in the consolidated statement of fi nancial position within short-term accrued expenses and other short-term liabilities. The non-current portion of € 1,024 million is recorded as pension liability.

Contributions to Fresenius Group's pension fund were € 106 million in the fi rst three quarters of 2016. This amount includes a discretionary cash contribution of US\$ 100 million (€ 90 million) by Fresenius Medical Care to its pension plan assets in the United States. The Fresenius Group expects approximately € 112 million contributions to the pension fund during 2016.

Defi ned benefi t pension plans' net periodic benefi t costs of € 88 million (Q1 – 3 / 2015: € 84 million) were comprised of the following components:

€ in millions	Q1 – 3 / 2016	Q1 – 3 / 2015
Service cost	40	35
Interest cost	34	33
Expected return on plan assets	- 16	- 16
Amortization of unrealized actuarial losses, net	29	32
Amortization of prior service costs	1	–
Amortization of transition obligations	–	–
Net periodic benefi t cost	88	84

15. NONCONTROLLING INTEREST

NONCONTROLLING INTEREST SUBJECT TO PUT PROVISIONS

Noncontrolling interest subject to put provisions changed as follows:

€ in millions	Q1 – 3 / 2016
Noncontrolling interest subject to put provisions as of January 1, 2016	947
Noncontrolling interest subject to put provisions in profi t	119
Purchase of noncontrolling interest subject to put provisions	73
Dividend payments	- 120
Currency effects and other changes	79
Noncontrolling interest subject to put provisions as of September 30, 2016	1,098

99.4% of noncontrolling interest subject to put provisions applied to Fresenius Medical Care at September 30, 2016.

As of September 30, 2016 and December 31, 2015, put options with an aggregate purchase obligation of € 263 million and € 237 million, respectively, were exercisable. Two put options were exercised for a total consideration of € 0.7 million in the fi rst three quarters of 2016 (Q1 – 3 / 2015: one put option in the amount of € 0.4 million).

NONCONTROLLING INTEREST NOT SUBJECT TO PUT PROVISIONS

As of September 30, 2016 and December 31, 2015, noncontrolling interest not subject to put provisions in the Fresenius Group was as follows:

€ in millions	Sept. 30, 2016	Dec. 31, 2015
Noncontrolling interest not subject to put provisions in
Fresenius Medical Care AG & Co. KGaA	6,564	6,274
Noncontrolling interest not subject to put provisions in VAMED AG	52	49
Noncontrolling interest not subject to put provisions in the business segments
Fresenius Medical Care	579	559
Fresenius Kabi	78	120
Fresenius Helios	61	59
Fresenius Vamed	7	7
Total noncontrolling interest
not subject to put provisions	7,341	7,068

Noncontrolling interest not subject to put provisions changed as follows:

€ in millions	Q1 – 3 / 2016
Noncontrolling interest not subject to put provisions as of January 1, 2016	7,068
Noncontrolling interest not subject to put provisions in profi t	640
Stock options	45
Purchase of noncontrolling interest not subject to put provisions	8
Dividend payments	- 230
Currency effects and other changes	- 190
Noncontrolling interest not subject to put provisions as of September 30, 2016	7,341

FRESENIUS SE & CO. KGAA SHAREHOLDERS' EQUITY

SUBSCRIBED CAPITAL

As of January 1, 2016, the subscribed capital of Fresenius SE & Co. KGaA consisted of 545,727,950 bearer ordinary shares.

During the fi rst three quarters of 2016, 1,204,781 stock options were exercised. Consequently, as of September 30, 2016, the subscribed capital of Fresenius SE & Co. KGaA consisted of 546,932,731 bearer ordinary shares. The shares are issued as non-par value shares. The proportionate amount of the subscribed capital is € 1.00 per share.

CONDITIONAL CAPITAL

The following Conditional Capitals exist in order to fulfi ll the subscription rights under the stock option plans of Fresenius SE & Co. KGaA: Conditional Capital I (Stock Option Plan 2003), Conditional Capital II (Stock Option Plan 2008) and Conditional Capital IV (Stock Option Plan 2013) (see note 23, Stock options). Another Conditional Capital III exists for the authorization to issue option bearer bonds and / or convertible bonds.

The following table shows the development of the Conditional Capital:

in €	Ordinary shares
Conditional Capital I Fresenius AG Stock Option Plan 2003	5,261,987
Conditional Capital II Fresenius SE Stock Option Plan 2008	7,216,907
Conditional Capital III option bearer bonds and / or convertible bonds	48,971,202
Conditional Capital IV Fresenius SE & Co. KGaA Stock Option Plan 2013	25,200,000
Total Conditional Capital as of January 1, 2016	86,650,096
Fresenius AG Stock Option Plan 2003 – options exercised	- 200,602
Fresenius SE Stock Option Plan 2008 – options exercised	- 1,004,179
Total Conditional Capital as of September 30, 2016	85,445,315

As of September 30, 2016, the Conditional Capital was composed as follows:

in €	Ordinary shares
Conditional Capital I Fresenius AG Stock Option Plan 2003	5,061,385
Conditional Capital II Fresenius SE Stock Option Plan 2008	6,212,728
Conditional Capital III option bearer bonds and / or convertible bonds	48,971,202
Conditional Capital IV Fresenius SE & Co. KGaA Stock Option Plan 2013	25,200,000
Total Conditional Capital as of September 30, 2016	85,445,315

DIVIDENDS

Under the German Stock Corporation Act (AktG), the amount of dividends available for distribution to shareholders is based upon the unconsolidated retained earnings of Fresenius SE & Co. KGaA as reported in its statement of fi nancial position determined in accordance with the German Commercial Code (HGB).

In May 2016, a dividend of € 0.55 per bearer ordinary share was approved by Fresenius SE & Co KGaA's shareholders at the Annual General Meeting and paid. The total dividend payment was € 300 million.

17. OTHER COMPREHENSIVE INCOME (LOSS)

Other comprehensive income (loss) is comprised of all amounts recognized directly in equity (net of tax) resulting from the currency translation of foreign subsidiaries' fi nancial statements and the effects of measuring fi nancial instruments at their fair value as well as the change in benefi t obligation.

Changes in accumulated other comprehensive income (loss) net of tax by component were as follows:

Amount of gain or loss reclassifi ed from accumulated other

€ in millions	Cash fl ow hedges	Change of fair value of available for sale fi nancial assets	Foreign currency translation	Actuarial gains / losses on defi ned benefi t pension plans	Total, before non controlling interest	Non controlling interest	Total, after non controlling interest
Balance as of December 31, 2014	- 109	1	294	- 305	- 119	189	70
Other comprehensive income (loss) before reclassifi cations	8	–	212	- 15	205	360	565
Amounts reclassifi ed from accumulated
other comprehensive income (loss)	7	0	–	11	18	27	45
Other comprehensive income (loss), net	15	–	212	- 4	223	387	610
Balance as of September 30, 2015	- 94	1	506	- 309	104	576	680
Balance as of December 31, 2015	- 84	1	619	- 256	280	741	1,021
Other comprehensive income (loss) before reclassifi cations	- 6	–	- 83	–	- 89	- 159	- 248
Amounts reclassifi ed from accumulated
other comprehensive income (loss)	8	0	–	11	19	17	36
Other comprehensive income (loss), net	2	–	- 83	11	- 70	- 142	- 212
Balance as of September 30, 2016	- 82	1	536	- 245	210	599	809

Reclassifi cations out of accumulated other comprehensive income (loss) into net income were as follows:

	comprehensive income (loss) 1
€ in millions	Q1 – 3 / 2016	Q1 – 3 / 2015	Affected line item in the consolidated statement of income
Details about accumulated other comprehensive income (loss) components
Cash fl ow hedges
Interest rate contracts	23	28	Interest income / expense
Foreign exchange contracts	- 1	16	Cost of sales
Foreign exchange contracts	2	- 9	Selling, general and administrative expenses
Other comprehensive income (loss)	24	35
Tax expense or benefi t	- 8	- 11
Other comprehensive income (loss), net	16	24
Amortization of defi ned benefi t pension items
Prior service costs	1	–	2
Transition obligations	–	–	2
Actuarial gains / losses on defined benefit pension plans	29	32	2
Other comprehensive income (loss)	30	32
Tax expense or benefi t	- 10	- 11
Other comprehensive income (loss), net	20	21
Total reclassifi cations for the period	36	45

1 Gains are shown with a negative sign, losses with a positive sign.

2 Net periodic benefi t cost is allocated as personnel expense within cost of sales or selling,

general and administrative expenses as well as research and development expenses.

OTHER NOTES

18. LEGAL AND REGULATORY MATTERS

The Fresenius Group is routinely involved in claims, lawsuits, regulatory and tax audits, investigations and other legal matters arising, for the most part, in the ordinary course of its business of providing healthcare services and products. Legal matters that the Fresenius Group currently deems to be material or noteworthy are described below. For the matters described below in which the Fresenius Group believes a loss is both reasonably possible and estimable, an estimate of the loss or range of loss exposure is provided. For the other matters described below, the Fresenius Group believes that the loss probability is remote and / or the loss or range of possible losses cannot be reasonably estimated at this time. The outcome of litigation and other legal matters is always diffi cult to predict accurately and outcomes that are not consistent with Fresenius Group's view of the merits can occur. The Fresenius Group believes that it has valid defenses to the legal matters pending against it and is defending itself vigorously. Nevertheless, it is possible that the resolution of one or more of the legal matters currently pending or threatened could have a material adverse effect on its business, results of operations and fi nancial condition.

Further information regarding legal disputes, court proceedings and investigations can be found in detail in the consolidated fi nancial statements in the 2015 Annual Report. In the following, only the changes during the fi rst three quarters ended September 30, 2016 compared to the information provided in the consolidated fi nancial statements are described. These changes should be read in conjunction with the overall information in the consolidated fi nancial statements in the 2015 Annual Report; defi ned terms or abbreviations having the same meaning as in the 2015 Annual Report.

PRODUCT LIABILITY LITIGATION

As subsequently amended with the courts' approval as to the applicable timetable, plaintiffs must advise FMCH of acceptance of the settlement by November 7, 2016; FMCH has until November 15, 2016 to exercise any rights to void the settlement; and payment of the settlement amount must be made in November 2016 if the settlement is confi rmed.

Subsequent to the agreement in principle, FMCH's insurers in the AIG group initiated an action for declaratory judgment in New York state court advancing various arguments for reducing the amount of their coverage obligations. FMCH fi led an action in Massachusetts state court seeking to compel the AIG group carriers to honor their obligations under applicable policies, including reimbursement to FMCH of litigation defense costs incurred before the agreement in principle was reached. The affected carriers have confi rmed that the coverage litigation does not impact their commitment to fund US\$ 220 million of the settlement with plaintiffs.

Four institutional plaintiffs have fi led complaints against FMCH or its affi liates under state deceptive practices statutes resting on certain background allegations common to the Granufl o ® / Naturalyte ® personal injury litigation, but seeking as remedy the repayment of sums paid to FMCH attributable to the Granufl o ® / Naturalyte ® products. These cases implicate different legal standards, theories of liability and forms of potential recovery from those in the personal injury litigation and their claims will not be extinguished by the personal injury litigation settlement described above. The four plaintiffs are the Attorneys General for the States of Kentucky, Louisiana and Mississippi and the commercial insurance company Blue Cross Blue Shield of Louisiana in its private capacity. See, State of Mississippi ex rel. Hood, v. Fresenius Medical Care Holdings, Inc., No. 14-cv-152 (Chancery Court, DeSoto County); State of Louisiana ex re. Caldwell and Louisiana Health Service & Indemnity Company v. Fresenius Medical Care Airline, 2016 Civ. 11035 (U.S.D.C. D. Mass.); Commonwealth of Kentucky ex rel. Beshear v. Fresenius Medical Care Holdings, Inc. et al., No. 16-CI-00946 (Circuit Court, Franklin County).

SUBPOENAS "MASSACHUSETTS AND LOUISIANA"

On March 29, 2016, the Court dismissed the relator's companion claims for retaliatory termination of employment, fi nding that the retaliation claims were barred under principles of res judicata by a January 2015 jury verdict in the United States District Court for the Central District of California. The California verdict remains on appeal in the Ninth Circuit Court of Appeals.

CIVIL COMPLAINT "HAWAII"

In July 2015, the Attorney General for Hawaii issued a civil complaint under the Hawaii False Claims Act alleging a conspiracy pursuant to which certain Liberty subsidiaries of FMCH overbilled Hawaii Medicaid for Liberty's Epogen ® administrations to Hawaii Medicaid patients during the period from 2006 through 2010, prior to the time of FMCH's acquisition of Liberty. See, Hawaii v. Liberty Dialysis – Hawaii, LLC et al., Case No. 15-1-1357-07 (Hawaii 1st Circuit). The State alleges that Liberty acted unlawfully by relying on incorrect and unauthorized billing guidance provided to Liberty by Xerox State Healthcare LLC, which acted as Hawaii's contracted administrator for its Medicaid program reimbursement operations during the relevant period. The amount of the overpayment claimed by the State is approximately US\$ 8 million, but the State seeks civil remedies, interest, fi nes, and penalties against Liberty and FMCH under the Hawaii False Claims Act substantially in excess of the overpayment. FMCH fi led third-party claims for contribution and indemnifi cation against Xerox. The State's False Claims Act complaint was fi led after Liberty initiated an administrative action challenging the State's recoupment of alleged overpayments from sums currently owed to Liberty. The administrative action is continuing.

SUBPOENA "TEXAS (DALLAS)"

On June 30, 2016, FMCH received a subpoena from the United States Attorney for the Northern District of Texas (Dallas) seeking information about the use and management of pharmaceuticals including Velphoro ® as well as FMCH's interactions with DaVita Healthcare Partners, Inc. FMCH understands that the subpoena relates to an investigation previously

disclosed by DaVita and that the investigation encompasses DaVita, Amgen, and Sanofi . FMCH is cooperating in the investigation.

SUBPOENA "NEVADA"

Through a further ancilliary subpoena of June 2016, the DOJ has requested further information from Fresenius Kabi USA without changing the focus of the investigation.

The Fresenius Group regularly analyzes current information including, as applicable, the Fresenius Group's defenses and insurance coverage and, as necessary, provides accruals for probable liabilities for the eventual disposition of these matters.

The Fresenius Group, like other healthcare providers, insurance plans and suppliers conducts its operations under intense government regulation and scrutiny. It must comply with regulations which relate to or govern the safety and effi cacy of medical products and supplies, the marketing and distribution of such products, the operation of manufacturing facilities, laboratories, dialysis clinics and other health care facilities, and environmental and occupational health and safety. With respect to its development, manufacture, marketing and distribution of medical products, if such compliance is not maintained, the Fresenius Group could be subject to signifi cant adverse regulatory actions by the U.S. Food and Drug Administration (FDA) and comparable regulatory authorities outside the United States. These regulatory actions could include warning letters or other enforcement notices from the FDA, and / or comparable foreign regulatory authority, which may require the Fresenius Group to expend signifi cant time and resources in order to implement appropriate corrective actions. If the Fresenius Group does not address matters raised in warning letters or other enforcement notices to the satisfaction of the FDA and / or comparable regulatory authorities outside the United States, these regulatory authorities could take additional actions, including product recalls, injunctions against the distribution of products or operation of manufacturing plants, civil penalties, seizures of Fresenius Group's products and / or criminal prosecution. FMCH is currently engaged in remediation efforts with respect to one pending FDA warning letter, Fresenius Kabi with respect to two pending FDA warning letters. The Fresenius Group must also comply with the laws of the United States, including the federal Anti-Kickback Statute, the federal False Claims Act, the federal Stark Law, the federal Civil Monetary Penalties Law and the federal Foreign Corrupt Practices Act as well as other federal and state fraud and abuse laws. Applicable laws or regulations may be amended, or enforcement agencies or courts may make interpretations that differ from Fresenius Group's interpretations or the manner in which it conducts its business. Enforcement has become a high priority for the federal government and some states. In addition, the provisions of the False Claims Act authorizing payment of a portion of any recovery to the party bringing the suit encourage private plaintiffs to commence whistleblower actions. By virtue of this regulatory environment, Fresenius Group's business activities and practices

are subject to extensive review by regulatory authorities and private parties, and continuing audits, subpoenas, other inquiries, claims and litigation relating to Fresenius Group's compliance with appli cable laws and regulations. The Fresenius Group may not always be aware that an inquiry or action has begun, particularly in the case of whistleblower actions, which are initially fi led under court seal.

Other than those individual contingent liabilities mentioned in the consolidated fi nancial statements in the 2015 Annual Report and besides the purchase price obligation in the amount of € 5.76 billion for the acquisition of Quirónsalud, the current estimated amount of Fresenius Group's other known individual contingent liabilities is immaterial.

19. FINANCIAL INSTRUMENTS

VALUATION OF FINANCIAL INSTRUMENTS

The following table presents the carrying amounts and fair values as well as the fair value hierarchy levels of Fresenius Group's fi nancial instruments as of September 30, 2016 and December 31, 2015, classifi ed into classes:

		September 30, 2016		December 31, 2015
€ in millions	Fair value hierarchy level	Carrying amount	Fair value	Carrying amount	Fair value
Cash and cash equivalents	1	1,185	1,185	1,044	1,044
Assets recognized at carrying amount	2	4,958	4,958	4,674	4,674
Assets recognized at fair value	1	258	258	257	257
Liabilities recognized at carrying amount	2	15,649	16,841	16,069	17,171
Liabilities recognized at fair value	2	350	350	353	353
Noncontrolling interest subject to put provisions recognized at fair value	3	1,098	1,098	947	947
Derivatives for hedging purposes	2	315	315	358	358

Explanations regarding the signifi cant methods and assumptions used to estimate the fair values of fi nancial instruments and classifi cation of fair value measurements according to the three-tier fair value hierarchy as well as explanations with regard to existing and expected risks from fi nancial instruments and hedging can be found in the consolidated fi nancial statements in the 2015 Annual Report.

As of September 30, 2016, there was no indication for further possible signifi cant risks from fi nancial instruments or that a decrease in the value of Fresenius Group's fi nancing receivables (other current and non-current assets) was probable and the allowances on credit losses of fi nancing receivables are immaterial.

FAIR VALUES OF DERIVATIVE FINANCIAL INSTRUMENTS

	September 30, 2016		December 31, 2015
€ in millions	Assets	Liabilities	Assets	Liabilities
Interest rate contracts (current)	0	–	0	2
Interest rate contracts (non-current)	0	2	0	1
Foreign exchange contracts (current)	12	14	16	6
Foreign exchange contracts (non-current)	1	–	1	1
Derivatives designated as hedging instruments 1	13	16	17	10
Interest rate contracts (non-current)	–	1	0	3
Foreign exchange contracts (current) 1	5	21	23	7
Foreign exchange contracts (non-current) 1	–	–	–	–
Derivatives embedded in the convertible bonds	0	334	0	335
Stock options to secure the convertible bonds 1	334	0	335	0
Derivatives not designated as hedging instruments	339	356	358	345

Derivatives designated as hedging instruments, foreign exchange contracts and call options to secure the convertible bonds

not designated as hedging instruments are classifi ed as derivatives for hedging purposes.

Derivative fi nancial instruments are marked to market each reporting period, resulting in carrying amounts equal to fair values at the reporting date.

Derivatives not designated as hedging instruments, which are derivatives that do not qualify for hedge accounting, are also solely entered into to hedge economic business transactions and not for speculative purposes.

Derivatives for hedging purposes as well as the derivatives embedded in the convertible bonds were recognized at gross value within other assets in an amount of € 352 million and other liabilities in an amount of € 371 million.

The current portion of derivatives indicated as assets in the preceding table is recognized within other current assets in the consolidated statement of fi nancial position, while the current portion of those indicated as liabilities is included in short-term accrued expenses and other short-term liabilities. The non-current portions indicated as assets or liabilities are recognized in other non-current assets or in long-term accrued expenses and other long-term liabilities, respectively. The derivatives embedded in the convertible bonds and the call options to secure the convertible bonds are recognized in other non-current liabilities / assets in the consolidated statement of fi nancial position.

EFFECT OF DERIVATIVES DESIGNATED AS HEDGING INSTRUMENTS ON THE CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

	Q1 – 3 / 2016
€ in millions	Gain or loss recognized in other comprehensive income (loss) (effective portion)	Gain or loss reclassifi ed from accumulated other comprehensive income (loss) (effective portion)	Gain or loss recognized in the consolidated statement of income
Interest rate contracts	2	23	0
Foreign exchange contracts	- 7	1	0
Derivatives designated as hedging instruments 1	- 5	24	0

	Q1 – 3 / 2015
€ in millions	Gain or loss recognized in other comprehensive income (loss) (effective portion)	Gain or loss reclassifi ed from accumulated other comprehensive income (loss) (effective portion)	Gain or loss recognized in the consolidated statement of income
Interest rate contracts	- 7	28	0
Foreign exchange contracts	11	7	0
Derivatives designated as hedging instruments 1	4	35	0

The amount of gain or loss recognized in the consolidated statement

of income solely relates to the ineffective portion.

EFFECT OF DERIVATIVES NOT DESIGNATED AS HEDGING INSTRUMENTS ON THE CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

Derivatives not designated as hedging instruments	- 26	14
Call options to secure the convertible bonds	- 1	128
Derivatives embedded in the convertible bonds	1	- 128
Foreign exchange contracts	- 26	14
Interest rate contracts	–	–
€ in millions	Q1 – 3 / 2016	Q1 – 3 / 2015
	Gain or loss recognized in the consolidated statement of income

Losses from foreign exchange contracts not designated as hedging instruments recognized in the consolidated statement of income are faced by gains from the under lying transactions in the corresponding amount.

The Fresenius Group expects to recognize a net amount of € 1 million of the existing losses for foreign exchange contracts deferred in accumulated other comprehensive income (loss) in the consolidated statement of income within the next 12 months. For interest rate contracts, the Fresenius Group expects to recognize € 31 million of losses in the course of normal business during the next 12 months in interest expense.

Gains and losses from foreign exchange contracts and the corresponding underlying transactions are accounted for as cost of sales, selling, general and administrative expenses and net interest. Gains and losses resulting from interest rate contracts are recognized as net interest in the consolidated statement of income.

In the fi rst three quarters of 2016 and 2015, gains in an immaterial amount for available for sale fi nancial assets were recognized in other comprehensive income (loss).

MARKET RISK

Derivative fi nancial instruments

Classifi cation

The Fresenius Group elects not to offset the fair values of derivative fi nancial instruments subject to master netting agreements in the consolidated statement of fi nancial position.

At September 30, 2016 and December 31, 2015, the Fresenius Group had € 18 million and € 37 million of derivative fi nancial assets subject to netting arrangements and € 38 million and € 19 million of derivative fi nancial liabilities subject

to netting arrangements. Offsetting these derivative fi nancial instruments would have resulted in net assets of € 11 million and € 28 million as well as net liabilities of € 31 million and € 10 million at September 30, 2016 and December 31, 2015, respectively.

Foreign exchange risk management

As of September 30, 2016, the notional amounts of foreign exchange contracts totaled € 1,737 million. These foreign exchange contracts have been entered into to hedge risks from operational business and in connection with loans in foreign currency. Foreign exchange forward contracts to hedge risks from operational business were exclusively recognized as cash fl ow hedges as of September 30, 2016. The fair value of cash fl ow hedges was - € 1 million.

As of September 30, 2016, the Fresenius Group was party to foreign exchange contracts with a maximum maturity of 21 months.

Interest rate risk management

As of September 30, 2016, the U.S. dollar denominated interest rate hedges had a notional volume of US\$ 200 million (€ 179 million) as well as a fair value of - US\$ 0.3 million (- € 0.3 million) and expire in 2021. As of September 30, 2016, the euro denominated interest rate hedges had a notional volume of € 567 million and a fair value of - € 3 million. These interest rate hedges expire in the years 2016 to 2022.

At September 30, 2016 and December 31, 2015, the Fresenius Group had losses of € 51 million and € 68 million, respectively, related to settlements of pre-hedges deferred in accumulated other comprehensive income (loss), net of tax.

20. SUPPLEMENTARY INFORMATION ON CAPITAL MANAGEMENT

The Fresenius Group has a solid fi nancial profi le. As of September 30, 2016, the equity ratio was 43.3% and the debt ratio (debt / total assets) was 33.0%. As of September 30, 2016, the leverage ratio on the basis of net debt / EBITDA at LTM average exchange rates was 2.5.

The aims of the capital management and further information can be found in the consolidated fi nancial statements in the 2015 Annual Report.

The Fresenius Group is covered by the rating agencies Moody's, Standard & Poor's and Fitch.

The following table shows the company rating of Fresenius SE & Co. KGaA:

	Sept. 30, 2016	Dec. 31, 2015
Standard & Poor's
Corporate Credit Rating	BBB -	BBB -
Outlook	stable	stable
Moody's
Corporate Credit Rating	Baa3	Baa3
Outlook	stable	stable
Fitch
Corporate Credit Rating	BBB -	BB +
Outlook	stable	stable

On July 29, 2016, Fitch has upgraded the credit rating from BB + to BBB - with a stable outlook.

SUPPLEMENTARY INFORMATION ON THE CONSOLIDATED STATEMENT OF CASH FLOWS The following table provides additional information with regard to the consolidated statement of cash fl ows:

€ in millions	Q1 – 3 / 2016	Q1 – 3 / 2015
Interest paid	479	482
Income taxes paid	683	598

Cash paid for acquisitions (without investments in licenses) consisted of the following:

€ in millions	Q1 – 3 / 2016	Q1 – 3 / 2015
Assets acquired	583	211
Liabilities assumed	- 42	- 26
Noncontrolling interest	- 53	- 8
Notes assumed in connection with acquisitions	- 115	- 27
Cash paid	373	150
Cash acquired	- 23	- 4
Cash paid for acquisitions, net	350	146
Cash paid for investments, net of cash acquired Cash paid for intangible assets, net	120 8	70 23
Total cash paid for acquisitions and investments, net of cash acquired, and net purchases of intangible assets	478	239

22. NOTES ON THE CONSOLIDATED SEGMENT REPORTING

GENERAL

The consolidated segment reporting shown on pages 25 and 26 of this interim report is an integral part of the notes.

The Fresenius Group has identifi ed the business segments Fresenius Medical Care, Fresenius Kabi, Fresenius Helios and Fresenius Vamed, which corresponds to the internal organi za tional and reporting structures (Management Approach) at September 30, 2016.

The business segments were identifi ed in accordance with FASB ASC Topic 280, Segment Reporting, which defi nes the segment reporting requirements in the annual fi nancial statements and interim reports with regard to the operating business, product and service businesses and regions. Further explanations with regard to the business segments can be found in the consolidated fi nancial statements in the 2015 Annual Report.

NOTES ON THE BUSINESS SEGMENTS

Explanations regarding the notes on the business segments can be found in the consolidated fi nancial statements in the 2015 Annual Report.

RECONCILIATION OF KEY FIGURES TO CONSOLIDATED EARNINGS

€ in millions	Q1 – 3 / 2016	Q1 – 3 / 2015
Total EBIT of reporting segments	3,113	2,868
Special items	0	- 28
General corporate expenses Corporate / Other (EBIT)	- 21	- 19
Group EBIT	3,092	2,821
Net interest	- 433	- 476
Income before income taxes	2,659	2,345

RECONCILIATION OF NET DEBT WITH THE CONSOLIDATED STATEMENT OF FINANCIAL POSITION

€ in millions	Sept. 30, 2016	Dec. 31, 2015
Short-term debt	966	202
Short-term debt from related parties	–	4
Current portion of long-term debt and capital lease obligations	609	607
Current portion of Senior Notes	547	349
Long-term debt and capital lease obligations, less current portion	4,833	5,502
Senior Notes, less current portion	6,725	7,267
Convertible bonds	850	838
Debt	14,530	14,769
less cash and cash equivalents	1,185	1,044
Net debt	13,345	13,725

23. STOCK OPTIONS

FRESENIUS SE & CO. KGAA STOCK OPTION PLANS

As of September 30, 2016, Fresenius SE & Co. KGaA had three stock option plans in place: the Fresenius AG Stock Option Plan 2003 (2003 Plan) which is based on convertible bonds, the stock option based Fresenius SE Stock Option Plan 2008 (2008 Plan) and the Fresenius SE & Co. KGaA Long Term Incentive Program 2013 (2013 LTIP) which is based on stock options and phantom stocks. The 2013 LTIP is the only program under which stock options can be granted.

Transactions during the fi rst three quarters of 2016 On July 25, 2016, Fresenius SE & Co. KGaA awarded 2,244,538 stock options under the 2013 LTIP, including 348,750 options to members of the Management Board of Fresenius Management SE, at an exercise price of € 66.02, a fair value of € 15.31 each and a total fair value of € 34 million, which will be amortized over the four-year vesting period. Fresenius SE & Co. KGaA also awarded 234,205 phantom stocks, including 34,574 phantom stocks granted to members of the Management Board of Fresenius Management SE, at a measurement date (September 30, 2016) fair value of € 68.18 each and a total fair value of € 16 million, which will be revalued if the fair value changes, and amortized over the four-year vesting period.

During the fi rst three quarters of 2016, Fresenius SE & Co. KGaA received cash of € 25 million from the exercise of 1,204,781 stock options.

327,862 convertible bonds were outstanding and exercisable under the 2003 Plan at September 30, 2016. The members of the Fresenius Management SE Management Board held no more convertible bonds. At September 30, 2016, out of 2,795,041 outstanding stock options issued under the 2008 Plan, 333,420 were held by the members of the Fresenius Management SE Management Board. 8,056,388 stock options issued under the 2013 LTIP were outstanding at September 30, 2016. The members of the Fresenius Management SE Management Board held 1,046,250 stock options. 1,056,569 phantom stocks issued under the 2013 LTIP were outstanding at September 30, 2016. The members of the Fresenius Management SE Management Board held 202,055 phantom stocks.

As of September 30, 2016, 3,122,903 options for ordinary shares were outstanding and exercisable. On September 30, 2016, total unrecognized compensation cost related to nonvested options granted under the 2013 LTIP was € 62 million. This cost is expected to be recognized over a weightedaverage period of 3.1 years.

FRESENIUS MEDICAL CARE AG & CO. KGAA PERFORMANCE SHARES

Fresenius Medical Care AG & Co. KGaA Long-Term Incentive Program 2016

As of May 11, 2016, the issuance of stock options and phantom stocks under the Fresenius Medical Care AG & Co. KGaA (FMC-AG & Co. KGaA) Long-Term Incentive Program 2011 (LTIP 2011) is no longer possible. In order to continue to enable the members of the Management Board, the members of the management boards of affi liated companies and managerial staff members to adequately participate in the long-term, sustained success of Fresenius Medical Care, the Management Board and the Supervisory Board of Fresenius Medical Care Management AG have approved and adopted the FMC-AG & Co. KGaA Long-Term Incentive Plan 2016 (LTIP 2016) as a successor program effective January 1, 2016.

The LTIP 2016 is a variable compensation program with long-term incentive effects. Pursuant to the LTIP 2016, the plan participants may be granted so-called "Performance Shares" annually or semiannually during 2016 to 2018. Performance Shares are non-equity, cash-settled virtual compensation instruments which may entitle plan participants to receive a cash payment depending on the achievement of pre-defi ned performance targets further defi ned below as well as FMC-AG & Co. KGaA's share price development.

For members of the Management Board, the Supervisory Board will, in due exercise of its discretion and taking into account the individual responsibility and performance of each Management Board member, determine an initial value for each grant for any awards to Management Board members. For plan participants other than the members of the Management Board, such determination will be made by the Management Board. In order to determine the number of Performance Shares each plan participant receives, their respective grant value will be divided by the value per Performance Share at the time of the grant, which is mainly determined based on the average price of FMC-AG & Co. KGaA's shares over a period of 30 calendar days prior to the respective grant date.

The number of granted Performance Shares may change over the performance period of three years, depending on the level of achievement of the following: (i) revenue growth, (ii) growth in net income attributable to shareholders of FMC-AG & Co. KGaA (net income growth) and (iii) return on invested capital (ROIC) improvement.

Revenue, net income and ROIC are determined according to IFRS in Euro based on full year results. Revenue growth and net income growth, for the purpose of this plan, are determined at constant currency.

An annual target achievement level of 100% will be reached for the revenue growth performance target if revenue growth is 7% in each individual year of the three-year performance period; revenue growth of 0% will lead to a target achievement level of 0% and the maximum target achievement level of 200% will be reached in the case of revenue growth of at least 16%. If revenue growth ranges between these values, the degree of target achievement will be linearly interpolated between these values.

An annual target achievement level of 100% for the net income growth performance target will be reached if net income growth is 7% in each individual year of the threeyear performance period. In the case of net income growth of 0%, the target achievement level will also be 0%; the maximum target achievement of 200% will be reached in the case of net income growth of at least 14%. Between these values, the degree of target achievement will be determined by means of linear interpolation.

With regard to ROIC improvement, an annual target achievement level of 100% will be reached if the target ROIC as defi ned for the respective year is reached. The target ROIC is 7.3% for 2016 and will increase by 0.2 percentage points per year to 7.5% (2017), 7.7% (2018), 7.9% (2019) and 8.1% (2020). A target achievement level of 0% will be reached if the ROIC falls below the target ROIC for the respective year by 0.2 percentage points or more, whereas the maximum target achievement level of 200% will be reached if the target ROIC for the respective year is exceeded by 0.2 percentage points or more. The degree of target achievement will be determined by means of linear interpolation if the ROIC ranges between these values. In case the annual ROIC target achievement level in the third year of a performance period is equal or higher than the ROIC target achievement level in each of the two previous years of such performance period, the ROIC target achievement level of the third year is deemed to be achieved for all years of the respective performance period.

The achievement level for each of the three performance targets will be weighted annually at one-third to determine the yearly target achievement for each year of the three-year performance period. The level of overall target achievement over the three-year performance period will then be determined on the basis of the mean of these three average yearly target achievements. The overall target achievement can be in a range of 0% to 200%.

The number of Performance Shares granted to the plan participants at the beginning of the performance period will each be multiplied by the level of overall target achievement in order to determine the fi nal number of Performance Shares.

The fi nal number of Performance Shares is generally deemed earned four years after the day of a respective grant (the vesting period). The number of such vested Performance Shares is then multiplied by the average FMC-AG & Co. KGaA share price over a period of 30 days prior to the lapse of this four-year vesting period. The respective resulting amount will then be paid to the plan participants as cash compensation.

Transactions during the fi rst three quarters of 2016 The fi rst awards under the LTIP 2016 were granted on July 25, 2016. FMC-AG & Co. KGaA awarded 633,967 Performance Shares, the equivalent in Euros at the grant date being € 49 million, including 79,888 Performance Shares or € 6 million awarded to the members of the Management Board of FMC Management AG. The fair value per Performance Share at the grant date was €76.80.

During the fi rst three quarters of 2016, 827,252 stock options were exercised. Fresenius Medical Care AG & Co. KGaA received cash of € 35.2 million upon exercise of these stock options and € 7.6 million from a related tax benefi t.

24. RELATED PARTY TRANSACTIONS

In 2015, Fresenius Medical Care provided unsecured loans to an associated company under customary conditions, which have been fully repaid as of June 30, 2016.

25. SUBSEQUENT EVENTS

There have been no signifi cant changes in the Fresenius Group's operating environment following the end of the fi rst three quarters of 2016. No other events of material importance on the assets and liabilities, fi nancial position, and results of operations of the Group have occurred following the end of the fi rst three quarters of 2016.

26. CORPORATE GOVERNANCE

For each consolidated stock exchange listed entity, the declaration pursuant to Section 161 of the German Stock Corporation Act (Aktiengesetz) has been issued and made available to shareholders on the website of Fresenius SE & Co. KGaA (www.fresenius.com / corporate-governance), and of Fresenius Medical Care AG & Co. KGaA (www.freseniusmedicalcare.com).

FINANCIAL CALENDAR

Report on Fiscal Year 2016	February 22, 2017
Report on 1st quarter 2017
Conference call, Live webcast	May 3, 2017
Annual General Meeting, Frankfurt am Main
Live webcast of the speech of the Chairman
of the Management Board	May 12, 2017
Report on 1st half 2017
Conference call, Live webcast	August 1, 2017
Report on 1st – 3rd quarter 2017
Conference call, Live webcast	November 2, 2017

Subject to change

FRESENIUS SHARE / ADR

	Ordinary share		ADR
Securities identifi cation no.	578 560	CUSIP	35804M105
Ticker symbol	FRE	Ticker symbol	FSNUY
ISIN	DE0005785604	ISIN	US35804M1053
Bloomberg symbol	FRE GR	Structure	Sponsored Level 1 ADR
Reuters symbol	FREG.de	Ratio	4 ADR = 1 Share
Main trading location	Frankfurt / Xetra	Trading platform	OTCQX

Corporate Headquarters

Else-Kröner-Straße 1 Bad Homburg v. d. H. Germany

Postal address Fresenius SE & Co. KGaA 61346 Bad Homburg v. d. H.

Germany

Contact for shareholders

Investor Relations Telephone: ++ 49 61 72 6 08-24 85 Telefax: ++ 49 61 72 6 08-24 88 E-mail: [email protected]

Contact for journalists

Corporate Communications Telefon: ++ 49 61 72 6 08-23 02 Telefax: ++ 49 61 72 6 08-22 94 E-mail: [email protected]

Commercial Register: Bad Homburg v. d. H.; HRB 11852 Chairman of the Supervisory Board: Dr. Gerd Krick

General Partner: Fresenius Management SE

Registered Offi ce and Commercial Register: Bad Homburg v. d. H.; HRB 11673

Management Board: Stephan Sturm (President and CEO), Dr. Francesco De Meo, Dr. Jürgen Götz, Mats Henriksson, Rice Powell, Dr. Ernst Wastler Chairman of the Supervisory Board: Dr. Gerd Krick

For additional information on the performance indicators used please refer to pages 25, 40, 56f., 100f. and 194 of the Annual Report 2015 of Fresenius SE & Co. KGaA . Constant currencies for income and expenses are calculated using prior year average rates; constant currencies for assets and liabilities are calculated using the mid-closing rate on the date of the respective statement of fi nancial position (cf. Annual Report 2015, page 111 in the PDF https://www.fresenius.com/fi nancial_reporting/Fresenius_GB_US_GAAP_2015_englisch.pdf).

Forward-looking statements:

This Quarterly Financial Report contains forward-looking statements. These statements represent assessments which we have made on the basis of the information available to us at the time. Should the assumptions on which the statements are based on not occur, or if risks should arise – as mentioned in the risk report in the 2015 Annual Report and the SEC fi lings of Fresenius Medical Care AG & Co. KGaA – the actual results could differ materially from the results currently expected.

AI Terminal

Fresenius SE & Co. KGaA

166_10-q_2016-11-01_9e6f8925-7fb0-478a-88d3-2d0401223a7e.pdf

Quarterly Financial Report of Fresenius Group

TABLE OF CONTENTS

3 Fresenius Group fi gures at a glance

6 Management Report

20 Consolidated fi nancial statements

27 Notes

FRESENIUS GROUP FIGURES AT A GLANCE

SALES, EARNINGS, AND CASH FLOW

BALANCE SHEET AND INVESTMENTS

RATIOS

INFORMATION BY BUSINESS SEGMENT

FRESENIUS MEDICAL CARE – Dialysis products, Dialysis services

FRESENIUS KABI – IV drugs, Clinical nutrition, Infusion therapy,

FRESENIUS HELIOS – Hospital operations

FRESENIUS SHARE

FIRST TO THIRD QUARTER 2016

KEY DATA OF THE FRESENIUS SHARE

MANAGEMENT REPORT

CONTINUED STRONG SALES AND EARNINGS GROWTH; LOWER END OF GROUP EARNINGS GUIDANCE RAISED

HEALTH CARE INDUSTRY

RESULTS OF OPERATIONS, FINANCIAL POSITION, ASSETS AND LIABILITIES

SALES

EARNINGS

EARNINGS

SALES BY REGION

SALES BY BUSINESS SEGMENT

RECONCILIATION

INVESTMENTS

RECONCILIATION

INVESTMENTS BY BUSINESS SEGMENT

CASH FLOW

ASSET AND LIABILITY STRUCTURE

CASH FLOW STATEMENT (SUMMARY)

THIRD QUARTER OF 2016

BUSINESS SEGMENTS

FRESENIUS MEDICAL CARE

FIRST THREE QUARTERS OF 2016

THIRD QUARTER OF 2016

FRESENIUS KABI

FIRST THREE QUARTERS OF 2016

THIRD QUARTER OF 2016

FRESENIUS HELIOS

FIRST THREE QUARTERS OF 2016

THIRD QUARTER OF 2016

FRESENIUS VAMED

▶ Strong order intake of € 209 million in Q3

FIRST THREE QUARTERS OF 2016

THIRD QUARTER OF 2016

EMPLOYEES

EMPLOYEES BY BUSINESS SEGMENT

RESEARCH AND DEVELOPMENT

RESEARCH AND DEVELOPMENT EXPENSES BY BUSINESS SEGMENT

DIALYSIS

INFUSION THERAPIES, CLINICAL NUTRITION, GENERIC IV DRUGS, AND MEDICAL DEVICES

OPPORTUNITIES AND RISK REPORT

RATING

ANNOUNCED ACQUISITIONS

SUBSEQUENT EVENTS

OUTLOOK 2016

FRESENIUS GROUP

FRESENIUS MEDICAL CARE

FRESENIUS KABI

GROUP FINANCIAL OUTLOOK 2016

OUTLOOK 2016 BY BUSINESS SEGMENT

FRESENIUS HELIOS

FRESENIUS VAMED

INVESTMENTS

EMPLOYEES

RESEARCH AND DEVELOPMENT

FRESENIUS SE & CO. KGAA CONSOLIDATED STATEMENT OF INCOME (UNAUDITED)

FRESENIUS SE & CO. KGAA CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (UNAUDITED)

FRESENIUS SE & CO. KGAA CONSOLIDATED STATEMENT OF FINANCIAL POSITION (UNAUDITED)

ASSETS

LIABILITIES AND SHAREHOLDERS' EQUITY

FRESENIUS SE & CO. KGAA CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED)

FRESENIUS SE & CO. KGAA CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (UNAUDITED)

FRESENIUS SE & CO. KGAA CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (UNAUDITED)