B. Braun continues its sales and earnings growth
B. Braun Melsungen AG has successfully completed the 2016 financial year.
|Year 2015||Year 2016|
|Sales (in € million)||6,130||6,471||+5.6 %|
|Operating profit (in € million)||483||582||+20.6 %|
|Profit before taxes (in € million)||446||528||+18.5 %|
|Consolidated net income (in € million)||320||396||+23.9 %|
|EBITDA (in € million)||878||975||+11.0 %|
|Investment in property, plant & equipment, intangible assets, financial
investments and research & development expenses (in € million)
|Employees (as of December 31)||55,719||58,037||+4.2 %|
Melsungen/Morschen. With total sales of EUR 6,471 million (previous year: EUR 6,130 million), sales rose by 5.6 percent compared to fiscal 2015. On a currency-neutral basis, this figure was 7.9 percent. The consolidated net profit for the year increased significantly by 23 percent to EUR 396 million (previous year: EUR 320 million). "We can report a positive and stable result for the 2016 financial year. As far as sales growth is concerned, we are in line with our expectations; with a strong earnings growth, we have exceeded our self-imposed targets," said Prof. Heinz-Walter Große, Chairman of the Board of Management, during the financial press conference on Friday March 31, at which he and CFO Dr. Annette Beller presented the key figures for the 2016 financial year.
Increases in all divisions
All divisions contributed to the Group's sales performance and were able to increase their sales, as well as improve their profitability.
Hospital Care, the largest division, increased its sales by 4.7 percent to EUR 2,991 million (previous year: EUR 2,856 million). Demand was particularly high for automatic infusion pumps, infusion sets, and products for regional anesthesia. Moreover, business growth in the USA during 2016 was strong. Nutrilipid in the infusion bag, which has been marketed in the USA since last year, as well as other products for infusion therapy, supported sales and earnings growth there.
The Aesculap division generated sales of EUR 1,725 million (previous year: EUR 1,663 million) in the reporting year, which is 3.7 percent above the previous year. Main growth markets were China, Germany, and the USA. Increases in sales were achieved particularly in the angioplasty business segment for knee prostheses, endoscopy products, instrument containers, and technical services.
The Out Patient Market (OPM) division generated sales of EUR 782 million (previous year: EUR 741 million), an increase of 5.5 percent compared to the previous year. Sales of elastomeric pumps, infusion solutions, and infusion systems were particularly strong in the USA. The Asia-Pacific, Eastern Europe, and Latin America regions also had positive gains.
The B. Braun Avitum division showed substantial sales growth in the year under review with an 11.6 percent increase to EUR 945 million (previous year: EUR 846 million). As an operator of more than 350 dialysis centers worldwide, B. Braun Avitum treats more than 27,000 dialysis patients in more than 30 countries. In the product business both sectors consumer goods and dialysis machines were particularly successful. Main market growth drivers were Asia, Europe, and the USA. Additionally, sales were positively impacted by the expansion of B. Braun dialysis centers worldwide.
Development in the regions
Germany showed solid growth with sales increasing 5.9 percent. Europe (excluding Germany) posted a 6.7% increase in local currencies, while growth was 3.6 percent in euro terms. The Asia-Pacific region, which is the Group's growth engine with China, Indonesia, and Vietnam, proved strong in local currencies and increased sales by 10.8 percent. In euros, growth was 8.3 percent and sales were EUR 1.16 billion. The North American region achieved very good development, with growth in US dollars of 7.3 percent and in euros 7.6 percent. Latin America recorded a high sales growth of 15.3 percent in local currencies due to the sharp devaluation of local currencies against the euro, which led to a moderate increase in the Group currency of 2.3 percent. Impacted by changes in exchange rates, the Africa and Middle East regions were just above the previous year's growth of 1.0 percent, where South Africa could achieve significant increase in sales and profit.
Investment remains at a very high level
In 2016, B. Braun again invested more than EUR 1 billion. After EUR 1,049 million the previous year, EUR 1,098 million was invested in expanding production capacities, as well as researching and developing new products and processes. With selected acquisitions, the company also secured technologies and market shares in strategic business areas.
The Hospital Care division expanded its global capacity for large-volume infusion solutions in Indonesia, Malaysia, Spain, and the USA. This was accompanied by expanding the production of infusion systems and other accessories at various locations in order to meet the growing demand. In Berlin, investment in producing small-volume injection solutions continued in 2016. The construction of a new production facility in Japan not only increased capacity in regional anesthesia but also improved building safety features in the event of an earthquake. In Spain, the Aesculap division has begun to expand an already acquired building to meet the increasing demand for production capacities. Further investments are being made to modernize the Aesculap head office in Tuttlingen. The Out Patient Market division is further expanding its production capacities by making investments in France and manufacturing pen cannulae in Malaysia. Construction of a new building in Melsungen for patient-specific nutritional solutions was successfully completed in 2016. B. Braun Avitum increased its market share by expanding existing dialysis centers, constructing new centers, and acquiring centers in various countries. In addition to extensive investments at our Melsungen headquarters, funds were committed to production sites in France, Indonesia, Japan, Spain, Switzerland, and the USA.
Number of employees continued to increase
As of December 31, 2016, the B. Braun Group had 58,037 employees. This is 4.2 percent more than the previous year’s 55,719 employees. In Germany, the number of employees rose by 4.5 percent to 14,876 (previous year: 14,230). In addition to further developing production capacities this growth is due to the acquisition of several dialysis centers.
Qualifying young talent is increasingly important in the face of demographic change. With an increasing supply of instruction places and modern learning concepts, B. Braun is continuously engaged in training. At locations in Brazil, Germany, Malaysia, Poland, Switzerland, and Vietnam, 373 (previous year: 332) graduates successfully completed their apprenticeships in the reporting year. In the same period, the company acquired 275 trainees (previous year: 261). Currently, there are 1,065 (previous year: 1,092) young people in training in Brazil, Germany, Malaysia, Poland, Switzerland, and Vietnam.
"The 2016 financial year was the first full year of implementing our Group Strategy 2020," Prof. Große said. "As a ‘system partner in health care’ we would like to better understand the problems of our customers and partners and create suitable solutions by exchanging ideas with them. We are already seeing some initial successes in the market, and we are acknowledging this as confirmation that we are on the right path with our initiatives."
For the 2017 financial year, B. Braun forecasts Group sales growth between 5 and 7 percent at constant exchange rates.