Germany has been in the pandemic for more than a year.
These were and are tough months for quite a few industries.
At least the hospitals should benefit from the increased demand for medical care in such an environment, at least one would think.
But the opposite is the case, as the balance sheet of the largest European hospital group Fresenius shows.
After a difficult year 2019, the past financial year should originally bring a return to the usual growth rates.
The company, which is used to success and operates 112 clinics in Germany alone, had to put up with a failed takeover attempt in the USA and several profit warnings.
But CEO Stephan Sturm's plan to continue the previous growth story after the transition year 2019 came to nothing: Corona, of all things, is putting the Dax Group and its dialysis subsidiary Fresenius Medical Care (FMC), which is also listed in the largest German stock exchange index, more severe than expected.
Although sales at Fresenius rose slightly to 36.3 billion euros, the adjusted result fell by three percent to just under 1.8 billion euros.
FMC got it worse.
The consolidated profit decreased by three percent to 1.2 billion euros and collapsed by 48 percent in the fourth quarter.
Source: WORLD infographic
The demand for dialysis machines has even increased worldwide due to Corona.
Besides the lungs, the kidneys are the most common organ damaged by infection with Sars-Cov-2.
In some of the patients with a severe course, dialysis is necessary at least temporarily.
However, in recent months it has also been shown that patients with kidney disease who were dependent on such blood washing before the infection were among the particularly at risk corona risk patients.
You are at particularly high risk of suffering a severe course of Covid-19 or even of dying.
Due to the excess mortality of this patient group in particular, many originally planned blood washing treatments at FMC have been canceled in the past few months - this is evident in the company's red numbers.
Higher hygiene requirements create stress
At the parent company itself, which operates the two largest private hospital chains with Helios in Germany and Quironsalud in Spain, something else comes into play.
“You could think spontaneously that we as a hospital group should particularly benefit from the current situation.
That is not the case, ”said CEO Stephan Sturm at the virtual balance sheet press conference.
Although there was an increased demand for the Group's products and services, it was much more difficult than usual to generate the growth in sales.
Source: WORLD infographic
In the hospital business, the increased hygiene requirements due to Corona caused stress.
Even more serious is the fact that many so-called elective treatments have been discontinued in the past few months.
This does not mean urgently required medical treatments and operations that were postponed or canceled on a large scale, especially in the first wave of the pandemic, in order to keep intensive care beds free for Covid patients.
The occupancy rate in the Spanish clinics in particular fell by half in the spring, but hospitals in Germany were also affected in many places.
The sale of clinics is not excluded
Rachel Empey, chief financial officer, put the charges in the three-digit million range.
And the situation remains difficult: "We expect the number of cases to fall significantly below the 2019 level in 2021," said Sturm.
Hopefully the situation will normalize with an increasing number of people vaccinated.
"We are not assuming that there will be a catch-up effect," he said.
Instead, the group wants to reduce its costs because of the burdens caused by the pandemic.
Even the own group structure should be checked.
"We have to think about whether we get the appreciation we deserve from the capital market," said Sturm.
Job cuts and the sale of clinics are also expressly not excluded.
However, Fresenius does not intend to present further details until the quarterly figures are presented in May.
The group is sticking to the tradition of higher dividends.
The planned increase to 88 cents per share, which the Supervisory Board has yet to approve, would be the 28th increase in a row.
Source: WORLD infographic
"Helios has grown through the acquisition of larger clinic packages, there were also hospitals that have to be re-examined, especially in the current environment," said Sturm when asked about the possible savings plans in the clinic area.
If the numbers are not compatible with a long-term viable medical concept, "we have to consider whether we are still the suitable owner for such a house," he said.
But this will affect “not a very large number” of houses.
There have not yet been any concrete decisions.
The reserve parachute time is running out
Fresenius is by no means alone with the problems related to Covid-19.
Nationwide, the occupancy rate in most clinics is well below the level of previous years, and many treatment capacities have been cut due to Corona.
The state has so far financially supported hospitals that have kept beds free for Covid 19 patients.
But the rescue package that has been in place since November - which was already significantly smaller than the rescue package from the first wave in spring - expires at the end of the month.
It is still unclear how the sector will proceed afterwards.
The situation was tense even before the outbreak of the pandemic.
According to a survey by the German Hospital Association (DKG), almost every second clinic was in the red in 2019.
And from the industry's point of view, the situation is worsening due to the corona effect.
In January 2021, revenues in the sector fell by around 20 percent, the DKG announced.
In addition, the payments made by the federal government only offset about two thirds of the loss of income.
Debate about the number of hospitals
The annual hospital rating report predicted in mid-2020 that the number of deficit hospitals could rise to 50 percent by 2025.
In an international comparison, Germany has a particularly large number of hospital beds per 100,000 inhabitants.
Before the outbreak of the pandemic, the abundant hospital supplies were often criticized as being uneconomical.
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However, the high density of clinics and beds in the past year has also proven to be very helpful in caring for Covid 19 patients.
In some cases, the clinics even accepted patients from other EU countries such as Italy, Belgium or France.
If the financial plight of many clinics should worsen further due to Corona, the debate about the number of hospitals in Germany, which was largely silent last year, should quickly gain momentum again.