Financial Report Annual Report 2017

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2017 - The fiscal year in numbers

B. Braun performed well in a challenging fiscal year 2017. With sales growth of 5.7 percent at constant exchange rates, we are within our projected growth range of five to seven percent. The euro was strong against most currencies over the past fiscal year. Sales in euros thus increased 4.9 percent to € 6.8 billion (previous year: € 6.5 billion).

All divisions contributed to this strong sales growth. Out Patient Market and B. Braun Avitum divisions posted very strong growth rates of 5.9 percent and 9.2 percent, respectively. Hospital Care, with a gain of 4.1 percent, and Aesculap, with an increase in 3.6 percent, also achieved good sales growth.

In terms of operating results, we fell short of our goal of improving profitability in the reporting year. Higher start-up costs at new plants, production stoppages at our plant in Irvine, CA (USA) and legal costs in the USA, as well as intense price competition prevent an increase in profitability.

Nevertheless, we were able to increase EBITDA by 1.0 percent, but profit before taxes decreased 2.7 percent to € 513.7 million (previous year € 527.8 million). Due to a lower tax rate than the previous year, in particular we benefit from the corporate tax reform in the USA, we increased consolidated net income by 3.9 percent to € 411.5 million (previous year: € 396.0 million). Overall, the B. Braun Group is in a good, stable financial condition.

   2016 2017 Change in %
Sales (in € million)  6,471.0 6,788.9 + 4.9
EBITDA (in € million)  975.0 985.1 + 1.0
Profit before taxes (in € million) 527.8 513.7 - 2.7
Consolidated net income (in € million) 396.0 411.5 + 3.9
Employees (as of December 31) 58,037 61,583 + 6.1

Investment activities in fiscal year 2017 focused on increasing our production capacity and on new products and processes. We were also able to secure technology and access to markets in strategically important business areas through targeted acquisitions. We expended € 352.0 million in research and development activities (previous year: € 322.7 million). Additions to financial assets and property, plant and equipment (including capitalized development costs) due to Group-wide investing activities amounted to € 969.2 million during the fiscal year (previous year: € 806.7 million).

System partnership, collaboration and profitability are the core themes which are pursued in all divisions and regions, and supported by central services and departments. The goal is to grow together in order to ensure that our company will be able to operate independently over the long-term. This will allow us in the future to continue making a contribution to protecting and improving the health of people all over the world.

As a system partner, we aim to provide our customers with the best-possible service. In many cases, added value for our customers is created through the interplay of several different B. Braun products and services. This is due to our broad portfolio and the resulting combinations of products and services, which is a particular strength of ours. We are convinced that high quality at fair prices, products which are customized to align with treatment methods and customer processes and absolutely reliable delivery offer the added value which is required today and in the future.

By aligning our products and services based on the goals and processes of our customers, we increase the beneficial value of our work, reduce costs for our partners and help them succeed. Relationships within the company and with patients, users and suppliers are characterized by transparency, trust and recognition. We have set a goal of increasing sales by five to seven percent per year through 2020. In that case, annual sales can be increased to about € 8 billion at the end of the strategic period.