RHÖN-KLINIKUM AG: Today's Analyst Conference in Frankfurt/Main

RHÖN-KLINIKUM AG / Quarter Results/Results ForecastCorporate news transmitted by DGAP - a company of EquityStory AG.The issuer is solely responsible for the content of this announcement.
RHÖN-KLINIKUM AG, Bad Neustadt/Saale• Analyst conference in Frankfurt/Main• Results for the first nine months of 2006 (already published) explained• Market position and future strategy 1. Acquisition of university hospitals Gießen/Marburg 2. Health reform + Group’s 10-point programme 3. Goal: further market penetration • Forecast for 2006 results and trend result for 2007Bad Neustadt / Saale, 9 November 2006 ----- At Rhön-Klinikum AG’s analystconference held today in Frankfurt/Main, the Group’s results for the firstnine months of 2006 (already published on 26 October 2006) were once againbriefly explained and the parameters underpinning the expected resultsdiscussed. For the first nine months of 2006 the Group reports revenues of€ 1.4 billion (9M 2005: € 1.0 billion / + 36.7%). The jump in revenues inthe first nine months of the current financial year stems primarily (to thetune of € 280.9 million) from the consolidation of UniversitätsklinikumGießen/Marburg from 1 February 2006. Consolidated third-quarter revenuesreached € 489.8 million, up 37.4% from the same period in the previous year(Q3 2005: € 356.4 million). In the first nine months of 2006 (before theearnings share of minority owners), the Group’s net consolidated profitreached € 70.1 million (9M 2005: € 67.1 million / + 4.5%). That translatesinto an EpS in Q3 of € 0.45 (Q3 2005: € 0.42); with reference to the firstnine months EpS increased to € 1.29 (9M 2005: € 1.23).Market position and future strategyRe. (1) Acquisition of university hospitals Gießen/Marburg'The privatisation of the first university hospital is path breaking forthe whole of Germany and hitherto unique on the German hospital anduniversity landscape, serving as a beacon for the future', explainedWolfgang Pföhler, chairman of the Board of Management of the listedhospital group headquartered in the Rhön. 'With the acquisition ofUniversitätsklinikum Gießen/Marburg, our healthcare delivery chain iscomplete. Our offering now ranges from outpatient and inpatient basic andstandard care facilities to cutting-edge medicine at our maximum carefacilities, and thus spans all major fields of acute medicine'.He emphasised the good co-operation between the areas of research/teachingand healthcare, and in this connection congratulated the medical faculty ofthe University of Gießen on its award for excellence in promoting sciencein Germany received from the German Government and the German FederalStates. The restructuring and privatisation of Universitätsklinikum Gießen/Marburgare quietly moving ahead as planned. 'Both owners of the universityhospital are pulling together as one team', Pföhler said. 'The steadilyimproving earnings underscores our assessment that we will makeGießen/Marburg a success. Whereas the loss in the first abridged quarter of2006 – Gießen/Marburg has belonged to us only from 1 February – totalled €2.6 million and in the second quarter € 3.0 million, this was trimmed inthe third quarter to € 0.9 million. This loss will once again be cut byabout half in the fourth quarter. We will pursue our past strategyunrelenting and therefore assume that Gießen Marburg can turn a profit in2007'.Pföhler is convinced that more and more federal states will come to therealisation that the privatisation of university hospitals can successfullybe used to secure maximum-care medicine at universities. 'Given the currentwoes of Germany’s public finances we are certain that further universityhospitals will be offered on the market within the next two years'.Re. (2): Health reform and Group’s 10-point programmeThe Group’s management expects that the planned cuts, i.e. the generallowering of hospital budgets and prolonging of start-up financing forintegrated care, will give a further impetus to the privatisation process.Further drivers are the VAT hike planned for 1 January 2007 and risingdoctors’ salaries. The planned lowering of compensation for shortfallvolumes will also shake up the market. The chairman of the Board stated:'Of course we will not be unaffected by the impact of the reform, but wehave done our homework, are ready, and we can and will act.'The burdens can be compensated by numerous countermeasures that we havealready initiated', explained the chairman of the Board of Management. Themost important measures of the ten-point programme include the following:• For every Group hospital a plan of action has been prepared to steadilyreduce expenditures and raise earnings.• To offset the VAT increase we will proceed with an intelligent insourcingof services hitherto obtained from external providers, or certain purchaseswill be moved forward. By establishing tax consolidated groups, high VATpayments will be avoided. Moreover, the increase in VAT will be largelyoffset by the Group’s already existing bargaining power in purchasing.• With an even greater standardisation of input products – this relates tothe use of consumables and implants and the streamlining of our offering –procurement costs will be cut further.• We will step up our efforts to expand our material cost benchmarking andcompetition among our Group subsidiaries, thus further reducingexpenditures.• The internal reorganisation of our facilities will also be pushed aheadwith the continued consistent use of staffing benchmarks.• Moreover, leaner supply and discharge structures at our Group hospitalswill also help cut the costs of materials management, further optimisinghospital logistics.• We will counter the planned cuts in hospital budgets by raising casenumbers, expanding offerings and further developing specialisations atselected facilities. This internal growth will result in even betteroccupancy rates, which in turn will raise earnings.'We have not only identified the problems, but have already begun to solvethem', said Wolfgang Pföhler. All measures will move within a targetcorridor in their effects, thus making offsetting adjustments between theindividual measures a part of the concept and its ongoing fine-tuning.Re. (3): Goal – further market penetrationAccording to the Group’s CEO, the decision taken by the German governmenton healthcare reform heralds a sea change: it is trying to put a lid ondemand which is to be spread over waiting lists. Here, too, the Group’smanagement is ready with the right concepts. 'I would just name our conceptof the medical care centres (MVZs) attached to our Group hospitals, ourcomprehensive product portfolio and our willingness to offer the healthinsurance funds a generalised, full-coverage service. As you can see, thehealthcare reform measures will not put us off our long-term strategy ofsustained growth in earnings.'In addition to the ten-point programme to improve the operative processesin the Group’s individual hospitals and the Group as a whole, the Group’smanagement is also working on strategic concepts. RHÖN-KLINIKUM AG is alsostriving to lead developments beyond the day-to-day business of a hospital.The latest considerations were briefly summarised and outlined under thecatchphrase 'quality through standardisation and service volumes'.This subject is subdivided into the following four points:• Technology advances in a hospital’s clinical processes• Transfer of non-physician tasks to other professional groups• New professional model for doctors: greater efforts towards division oflabour and specialisation• Multi-level university hospital as a working model for generalisedprovision of healthcareThe Group's management are convinced that with the 10-point programme thecompany will quickly be able to take on and meet the challenges of thehealth reform. With the concepts as outlined the goal is to further raisethe efficiency and quality of healthcare delivery. 'This brings us one stepcloser to achieving our corporate goal of ensuring affordable, generalisedhealthcare for everyone to high quality standards', Pföhler explained. 'Wethus clearly continue our earnings-oriented growth strategy despite theburdens mentioned and will not disappoint our patients or our investors.'.To encourage debate on the subject 'Das Neue Ärztliche Berufsbild - ZurZukunft des Arztberufes im Krankenhaus' (New professional model for doctors– on the future of the doctor’s profession in the hospital) RHÖN-KLINIKUMAG will hold a symposium at the Sheraton Frankfurt Hotel & Towers,Frankfurt Airport Terminal 1, on Friday, 24 November 2006, from 12:30 toabout 5:00 p.m. The event is addressed to representatives of associations,politicians, the media, hospital directors as well as the Advisory Board ofRHÖN-KLINIKUM AG. The subject will be debated – probably controversially –by reputed guest speakers and dedicated panellists.Forecast for 2006 results and trend result for 2007'For financial year 2006 we continue to expect revenue of € 1.9 billion, anet consolidated profit of € 93.0 million and earnings per share of €1.72', said Wolfgang Pföhler. In this connection Dietmar Pawlik, thecompany’s CFO, referred to the special burdens that the hospital group hadto deal with this year and next, from the doctors’ strike – with theresulting increases in personnel expenditure – to the VAT increase as wellas budget cuts under the health reform. 'All of these are new burdens whichRHÖN-KLINIKUM Group did not face in the previous years and which will beoffset by the restructuring of the newly acquired hospitals and the10-point programme', Pawlik said.'Without taking into account acquisitions, we maintain our target forrevenues of just under € 2 billion and a net consolidated profit of € 100million for financial year 2007. We thus clearly continue ourfuture-oriented growth strategy despite the described burdens', explainedWolfgang Pföhler in closing.Brigitte SallweySallwey & PartnerTelemannstr. 18Tel.: (+49)069 97203628e-mail: sallwey@rhoen-klinikum-ag.comDGAP 09.11.2006 
 Language: EnglishIssuer: RHÖN-KLINIKUM AG Salzburger Leite 1 97616 Bad Neustadt/ Saale DeutschlandPhone: +49 (0)9771 - 65-0Fax: +49 (0)9771 - 97 467E-mail: fire.ir@rhoen-klinikum-ag.comWWW: www.rhoen-klinikum-ag.comISIN: DE0007042301WKN: 704230Indices: MDAXListed: Amtlicher Markt in Frankfurt (Prime Standard), München; Freiverkehr in Berlin-Bremen, Düsseldorf, Hamburg, Stuttgart End of News DGAP News-Service