UPDATE 1-Fresenius hikes profit outlook on strong hospitals unit

Tue Jul 30, 2013 2:00am EDT

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FRANKFURT, July 30 (Reuters) - German diversified healthcare group Fresenius SE raised its 2013 profit outlook, as its hospitals unit stands to benefit from higher reimbursement in Germany.

The company said on Tuesday it now expects net income to rise 11-14 percent, excluding exchange rate effects and integration costs for the acquired Fenwal business. Previously it saw its profit rising 7-12 percent.

In the three months through June, adjusted net profit rose about 10 percent to 258 million euros ($342 million), falling slightly short of consensus in a Reuters poll of 264 million euros.

Germany will next month introduce higher reimbursements paid to German hospitals, many of which are struggling to fund investments in medical gear.

Fresenius's Helios unit, Germany's largest private-sector hospitals chain by sales, buys underfunded hospitals from cash-strapped municipalities or other public-sector operators and restructures them to turn them around.

The group's listed subsidiary Fresenius Medical Care , the world's largest dialysis provider, reported second-quarter net income below expectations, hurt by austerity measures in the United States, its most important market.

A 2 percent reduction of U.S. federal spending under automatic cuts known as sequestration kicked in earlier this year, hurting healthcare providers.

Net income dropped 9 percent to $263 million, while analysts had on average expected $280 million.

The company said on Tuesday it continued to aim for 2013 net income of between $1.1 billion and $1.15 billion.

($1 = 0.7545 euros) (Reporting by Ludwig Burger; Editing by Maria Sheahan)

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