(Bloomberg) -- Fresenius Medical Care AG plans to eliminate as many as 5,000 full-time positions as the German kidney dialysis company reorganizes its business, which is suffering from patient deaths from Covid-19.
Fresenius Medical Care will spend 450 million euros ($522 million) to 500 million euros to fund the restructuring of its operations into two segments -- Care Enablement and Care Delivery, the Bad Homburg-based company said Tuesday. The measures aim to save 500 million euros a year by the end of 2025.
Fresenius Medical Care has grown more pessimistic about its prospects in 2021, saying it now expects to reach the lower end of its guidance range for revenue and net income this year. Covid has been afflicting patients, which is reducing revenue due to deaths and increasing costs for safety measures.
The “pandemic is an unprecedented situation for all of us and still costs many lives day by day,” Chief Executive Officer Rice Powell said in a separate earnings statement. Fresenius has had higher excess mortality rates among patients in the third quarter due to the spread of the delta variant, which has buffeted the business just as cost inflation has accelerated.
The stock rose as much as 1.4% in Frankfurt.
The company previously guided for revenue to grow at a low- to mid-single digit percentage rate and net income to decline at a high-teens to mid-twenties percentage rate.
Operating income slid to 505 million euros in the third quarter. The company expects the steps to deliver net savings from 2023.
Separately, parent company Fresenius SE raised its full-year sales forecast and said it now expects 2021 earnings around the top end of its guided range.
©2021 Bloomberg L.P.
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