Corporate News | 07/19/2006

RHÖN-KLINIKUM AG:Annual General Meeting

RHÖN-KLINIKUM AG / AGM/EGM/DividendCorporate 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- Annual General Meeting - 2005: Revenues € 1.416 billion / net consolidated profit € 88.3 million /investments € 291 million / operating cash flow € 156 million / earnings €1.61 per ordinary share / shareholders’ equity according to IFRS € 642million / 949,376 patient treatments / 21,226 employees / dividend pay-outof € 0.45 per ordinary share 2006: First half – revenues of € 938.1 million in line with targets / netconsolidated profit € 45.6 million / earnings per share € 0.84 / cash flow€ 78.1 million / investments € 276.3 million / 677,615 patient treatments /30,785 employees / 45 hospitals (of which 43 acute care and 2 rehab) at 34sites Outlook: Company continues to target qualified growth / development ofpromising future-oriented concepts, strategies and technologies for furtherlong-term growth in value Bad Neustadt a.d. Saale/Frankfurt am Main, 19 July 2006 ----- At today’sAnnual General Meeting of the listed hospital group Rhön-Klinikum, thefigures of the past financial year played only a subordinate role: The mostimportant key figures had already been presented and discussed at the endof April at this year’s Results Press Conference and can also be found onthe Group’s website ( there were 58.6% morepatient treatments ( = 350,891; previous year: 598,485 patients), revenuesrose by 35.5% to reach € 1.416 billion (previous year: € 1.045 billion),net consolidated profit rose by 10.1% to € 88.3 million (previous year: €80.2 million), earnings per ordinary share stood at € 1.61 (previous year:€ 1.47), the equity ratio declined to 39.5% (previous year: 49.2%) with thedebt financing of the numerous acquisitions and investments, operating cashflow recorded a rise to € 155.6 million (previous year: € 137.8 million, =+ 12.9%).On the whole the Management are pleased to have met their own forecasts andthose of analysts who have been following the Company’s development formany years. “We have delivered on our promises”, declared Wolfgang Pföhler,chairman of the Board of Management of RHÖN-KLINIKUM AG since the 2005Annual General Meeting, to shareholders represented at this year’s AGM.Nine new hospitals consolidated from the beginning of 2005, two in thefurther course of the year, as well as two further “acquired” hospitals(consolidated on 1 January 2006) bear witness to the buoyant growth. Thisstrategically planned and thus anticipated growth was eclipsed in December2005 by the decision of the Hesse State Government to sell to RHÖN-KLINIKUMAG the university hospitals Universitätsklinikum Gießen und Marburg GmbH,in which legal ownership was transferred in February of this year.The Annual General Meeting approved the dividend proposal of the Managementwhereby a total of € 23.328 million of the net distributable profit will bepaid out as a dividend of € 0.45 per ordinary share with dividendentitlement (€ 51,840,000 shares).Half-year results confirm forecast for full-year 2006 As in previous years RHÖN-KLINIKUM AG presented to the Annual GeneralMeeting its half-year report for 2006.In the first half, revenues increased 36.3% to reach € 938.1 million(previous year: € 688.3 million) and net consolidated profit rose by € 1.2million to reach € 45.6 million (previous year: € 44.4 million) –corresponding to € 0.84 per share (previous year: € 0.81 adjusted /+ 3.7%)– which according to Group Management meets their internal expectations.“The result in the first half of 2006 was burdened in particular by theloss at Universitätsklinikum Gießen und Marburg of € 5.6 million, but thiswas offset by improvements at the other hospitals”, said Dietmar Pawlik,who has been on the Board of Management since the beginning of the yearwith responsibility for Financing, Investor Relations and Controlling. “Weare convinced that we will confirm our own forecasts also at the end of theyear”, added Wolfgang Pföhler. “We continue to expect revenues of € 1.9billion and a net consolidated profit of € 93 million.”In the first six months of 2006 a total of 677,615 patients (previous year:487,835) were treated in the Group’s hospitals. At 30 June 2006, the Groupemployed 30,785 persons (31 December 2005: 21,226).Four central questions demonstrate continuity and renewal in the Company’sdevelopmentThe chairman of the Board of Management answered four questions to explainto those present where he sees the strengths of RHÖN-KLINIKUM Group andwhere in his view its future prospects lie. These were the questions aswell as the answers he gave:1. Where have we come from, what is our success story&#63Pföhler : In the past we were the first to implement the flow principle; wepressed ahead with the application of industrial production technologies tohospitals, introducing four-stage patient care which is now emulated bymany other hospital operators. In the present we are opening up new marketsthrough substantial investments each year and by moving ahead withinnovative models for healthcare delivery such as teleportal clinics,medical care centres (MVZs) and the building and commissioning of thecombined proton/heavy ion unit in Marburg.2. Where do we want to go from here, what are our goals&#63Pföhler : We want to maintain our position as the innovation leader andtrendsetter on the German hospital market. Looking long-term we,RHÖN-KLINIKUM AG, want to become a network provider with classicinfrastructure and service character: every patient in Germany is to haveno more than a 60- to 90-minute journey to reach one of our Groupfacilities. In order to ensure such national coverage in Germany, we willhave to raise our market share in the long term to over eight per cent fromcurrently just under three per cent.3. What makes the classic Rhön approach stand out, how will we achieve ourgoals&#63Pföhler : We begin by taking over increasingly loss-making publichospitals. With rationalisation investments and restructuring measures, wethen turn these facilities into profitable units. The investments not onlyrelate to buildings but also involve purchases of new medical technologyand equipment. By consistently restructuring all processes – with our focusof interest always being the patient as well as high-quality butcost-efficient treatment – we are able to cut costs significantly.4. What challenges does our Company face&#63- Cartel Office: Validity of the takeover of the hospitals from thedistrict of Rhön-Grabfeld was suspended by the prohibition by the FederalCartel Office. The appeal of RHÖN-KLINIKUM AG is still ongoing before theDüsseldorf Court of Appeals. We expect the Court to reach a decision in thefourth quarter of 2006.- Collective bargaining with the Marburger Bund: Pföhler emphasised thatUniversitätsklinikum Gießen/Marburg had seen only one strike, which howeverwas more symbolic than anything else, affecting only two departments andlasting only half a day – doctors continued their work at all otherhospitals of the Rhön Group. So no real strike took place at any of theGroup’s hospitals. At the moment negotiations are under way with theFederal State of Hesse and Marburger Bund to reach an agreement forGießen/Marburg. “We believe these constructive negotiations are making goodprogress”. Rising salaries for doctors were not an advantage for anyhospital; that said, privately run facilities were in a better position toturn things around and successfully adapt to new situations. As a result,the whole problem of the demands being made by the Marburger Bund incollective bargaining weighed far less heavily on RHÖN-KLINIKUM Group thanit might on competitors from the public sector, Pföhler went on to explain.Looking to the future Pföhler outlined how division of labour for doctorsat a hospital will have to develop in future to meet the needs of an agingsociety by using resources sparingly and thus preserving and even enhancingquality. Moreover, the Group would more than ever exploit thepossibilities of having certain medical tasks performed by healthcareprofessionals other than doctors, thus lowering personnel costs andachieving sustained value growth.- General framework conditions: According to the chairman’s statements, noconclusive assessment can be given of current political developments(notably healthcare reform). The planned VAT increase and the generallowering of hospital budgets as contemplated in the German government’swhite paper would not make things easy for RHÖN-KLINIKUM AG nor for otherhospitals.The Board of Management therefore has adopted a package of measures(“10-point programme”) and has already started implementing some of thesemeasures so as to offset any negative effects as early and as fully aspossible. “The healthcare reform measures which are currently beingconsidered and which will put a squeeze on margins in the short term arebeing countered on the operative side but will not deter RHÖN-KLINIKUM AGfrom its long-term strategy of sustained growth in earnings,” Pföhler said.Conclusion and word of thanks“Particularly in times of tight finances, mounting debt and steep taxhikes, there is a moral duty to work economically or, more precisely,efficiently. In other words, in the present day there could be hardlyanything more unethical than to waste resources. Efficiency does not meanreduction or cheap medicine', Pföhler said.“We see today’s totally fragmented German hospital market in an everquicker-paced privatisation wave. Our growth story is intact and enjoys asolid foundation. Our tried and proven dual strategy of acquisition andhospital integration is geared towards proactively pursuing furthertakeover activities. The German hospital market is being redistributed now,not in five years. We are therefore prepared for further acquisitionsalready today. But we don’t want growth at any cost. We want profitablegrowth alone. We carry through our acquisitions exercising the caution of aprudent businessman”.Pföhler then extended a word of thanks to patients for attending theGroup’s hospitals in reliance on their medical quality and good treatment,to employees for their performance and commitment, to the members of theWorks Council for their valued and trusted work, to the members of theSupervisory Board and Advisory Board for their constructive contribution,and last but not least to the shareholders for their trust in the futureviability and value of the share.Sallwey & PartnerBrigitte SallweyTelemannstr. 18D-60323 FrankfurtTel.: (+49) 069-97203628DGAP 19.07.2006
Language: EnglishIssuer: RHÖN-KLINIKUM AG Salzburger Leite 1 97616 Bad Neustadt/ Saale DeutschlandPhone: +49 (0)9771 - 65-0Fax: +49 (0)9771 - 97 467E-mail: 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