Corporate | 30 March 2004 09:11

MediClin AG has set the Course for the Future in Financial Year 2003

Corporate-news announcement processed and sent by DGAP. The sender is solely responsible for the contents of this announcement. ——————————————————————————– MediClin AG has set the Course for the Future in Financial Year 2003 – Low occupancy rate and special effects impact on revenues and earnings – No dividends for 2003 – Initiated measures will be continued in 2004 – Significant improvement of earnings expected for 2004 Frankfurt am Main, March 30, 2004 – At today’s press conference, the balance drawn for the 2003 financial year by the Board of Management of one of Germany’s large clinics operators, MediClin AG, was divided: On the one hand, the market for rehabilitation services is currently suffering by the weak economy and the deficit situation in the health care system. On the other hand, a number of areas in the health care market will grow. Therefore, the primary task of the Board of Management in 2003 was to prepare the company for these changes and to look for ways of adapting clinic capacities to the weakened demand while also developing new supplementary services that can stabilize the occupancy rates of the clinics. The package of measures implemented in the context of the Compact04 efficiency improvement and cost-cutting program began to yield the first positive results in 2003. Results of operations stabilized from quarter to quarter, although the fourth quarter came under the impact of special influences. The strengthening of sales and marketing activities brought additional results. MediClin’s PlusProgramme developed for private patients are increasingly in demand. The decisive factor for the further development in a number of locations will be the establishment of nursing care services. Beginning in April 2004, MediClin will offer nursing care grades one to three as well as short-term nursing care at six locations. A total of 400 beds have been allocated to this new segment. All these activities are MediClin’s way of reacting to the changes on the health care market. In the rehabilitation market supported medical rehabilitation, especially orthopedic rehabilitation are declining. On the other hand, other areas, such as subsequent nursing services (AHB), represent growing segments. The AHB-proportion of total post acute sales increased during the previous years at MediClin. Nevertheless, AHB will not be able to fully compensate for the lower capacities caused by the decline in medical rehabilitation. The gap will be filled by the Plusprogramme for private patients and introduction of nursing care. All measures introduced in 2003 will be continued in 2004. No dividends for 2003 The Supervisory Board approved the proposal of the Management Board not to pay any dividends for the 2003 financial year, but to appropriate the liquid funds primarily for investments in connection with the introduction of new services and for the expansion of the new nursing care segment. Revenue drops 3 percent and occupancy is down by 5.3 percent from the previous year At Euro 360 million, 2003 revenues including inventory changes were Euro 11.2 million or 3 percent down on the previous year’s level of Euro 371.2 million. The occupancy ratio in the Group was 75.0 percent (previous year: 79.2 percent). Results of operations improved in the second half of 2003, due mainly to the significantly optimized cost structures compared to the previous year. Thus, despite the more than Euro 11 million drop in revenues, operating profit without special effects was only slightly down on the previous year’s level of Euro – 6.3 million. The operating profit was burdened by not sustainable one-off costs amounting to approximately Euro 3,3 million. The special influences include one- off costs of Euro 1.3 million in the human resources sector and value adjustments resulting from final consolidation. Overall, operating profit declined by Euro 3.3 million to Euro – 9.6 million. The net loss of the group for the year amounted to Euro 16.8 million (previous year: net loss of Euro 13.5 million). Earnings per share were Euro – 0.53 (previous year: Euro – 0.43). Acute care has doubled its segment earnings. Post acute care was enhanced by efficiency measures The acute segment developed well in 2003 and closed the year competitively. At Euro 145.1 million, revenues were only slightly below the previous year’s level of Euro 146.7 million. The segment result doubled from Euro 2.2 million to Euro 4.4 million in 2003. In future, a greater focus is to be given to combining the concepts for ambulant, partly stationary and stationary services under one roof. The integrative collaboration between the acute facilities and the post acute facilities has been developing very positively. In the city of Waren, Mecklenburg-Vorpommern, MediClin will begin with the renovation and new construction of the Müritz-Klinikum, for which Euro 25 million of fundings have already been approved. The Board of Management of MediClin expects a moderate rise in results of operations in this segment in 2004. The post acute segment posted a revenue decline of nearly Euro 10 million. Revenues decreased from the previous year’s level of Euro 224.5 million to Euro 214.9 million in the current year. The development of segment results throughout the quarters indicates that the implemented measures have begun to take effect; however, the fourth quarter was burdened by special influences. The segment result for the year amounted to Euro – 14.0 million (previous year: Euro – 8.5 million). The Company also expects an improvement in the earning situation at the post acute facilities for 2004. Improved results of operations expected in 2004 MediClin will continue all measures initiated in 2003 for improving the cost structures of the clinics and will also push forward with its sales and marketing activities. The nursing care area should approach break even as early as in the 2004 financial year. Additional positive effects will be observed through the improved capacity utilization at the respective locations. The Board of Management expects a slight growth in revenue for financial year 2004. The expectations are that the Company’s earnings will see a marked improvement as a result of the new activities. A balanced result is expected for 2004. Further information: MediClin AG MediClin GmbH Investor Relations Public Relations Alexandra Mühr Gabriele Eberle Wilhelm-Leuschner-Straße 9-11 Okenstraße 27 60329 Frankfurt am Main 77652 Offenburg Tel. (0 69) 25 60 02-31 Tel. (07 81) 4 88-1 80 Fax (0 69) 25 60 02-69 Fax (07 81) 4 88-1 84 E-Mail: alexandra.muehr@mediclin.de E-Mail: gabriele.eberle@mediclin.de http://www.mediclin.de end of message, (c)DGAP 30.03.2004 ——————————————————————————– WKN: 659510; ISIN: DE0006595101; Index: Listed: Amtlicher Markt in Frankfurt (Prime Standard); Freiverkehr in Berlin- Bremen, Düsseldorf, Hamburg und Stuttgart 300911 Mär 04