Märkte & Kurse

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Original-Research: Borussia Dortmund GmbH & Co KGaA - from NuWays AG

20.08.2024 / 09:01 CET/CEST
Dissemination of a Research, transmitted by EQS News - a service of EQS
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The issuer is solely responsible for the content of this research. The
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Classification of NuWays AG to Borussia Dortmund GmbH & Co KGaA

     Company Name:               Borussia Dortmund GmbH & Co KGaA
     ISIN:                       DE0005493092

     Reason for the research:    Update
     Recommendation:             BUY
     from:                       20.08.2024
     Target price:               EUR 5.50
     Last rating change:
     Analyst:                    Philipp Sennewald

FYp: Record sales but weaker than expected profitability; chg.

Yesterday, BVB held an analyst conference, presenting the preliminary FY
23/24 results.

FY sales increased by 21.7% to EUR 509m, thus exceeding our estimate of EUR
483m. While we were largely in line regarding sales from TV marketing of EUR
206m (eNuW: EUR 203m) and advertising of EUR 147m (eNuW: EUR 147m), the other
segments performed significantly better than expected. Sales from match
operations increased by 20.9% yoy to EUR 52.6m (eNuW: EUR 47.4m), mainly due to
the increased number of games in the UCL, while merchandising sales were up
43.6% yoy to EUR 47.9m (eNuW: EUR 40m), driven by the success in the UCL but
also a better Christmas business ('22 Qatar WC harmed Christmas business
last year). Sales from conference and catering also increased significantly
by 34.7% yoy to EUR 56.0m (eNuW: EUR 45.7m) thanks to as well more home games in
the UCL but also UEFA payments for the usage of the Signal Iduna Park during
the 2024 European Championship.

EBITDA increased proportionately with sales to EUR 150m (+22% yoy; eNuW: EUR
165m) implying a yoy stable margin of 29.5%. The gap to our estimates is
mainly explained by increased personnel expenses in Q4 (+18% vs TTM avg.)
due to success premiums, lower than expected net transfer income and higher
other OpEx, which was among others caused by higher energy costs, higher
player loan expenses as well as higher logistics and travelling expenses.
Thanks to slightly lower D&A (-2% yoy) however, the company was able to
significantly improve its operating margin by 5pp to 9%.

Despite this, FCF came in negative at EUR -4.4m, which is explained by
infrastructure investments of c. EUR 20m (new catering facilities + property
acquired for women training ground), as well as UEFA and DFL related
payments, which have been postponed to the current business year (eNuW: EUR
15m).

Dividend return. For the first time since 2019, the management will propose
to the AGM to pay out a dividend. It is intended to pay out EUR 0.06 per
share, implying a yield of 1.5% given yesterday's close price.

Besides the release, BVB on the weekend reached the second round of the
national cup by defeating 4 th league side Lübeck (4-1). Moreover, BVB
announced another signing with promising German international Maximilian
Beyer. The young forward had his breakthrough last season at Hoffenheim,
where he contributed 16 goals and three assists, which earned him a spot in
Germany's squad for the 2024 European Championship. With him and Guirassy,
BVB now has two of last season's Top-5 goalscorers under contract.

With this, the team should be well equipped to earn a Top-4 spot at the end
of the season. Moreover, another deep run in the UCL is clearly in the
cards, yet we conservatively estimate them to reach the round of 16.

Valuation remains undemanding, as shares are trading on a mere 0.9x EV/Sales.
We hence reitereate BUY with an unchanged PT of EUR 5.50 based on DCF.

You can download the research here: http://www.more-ir.de/d/30561.pdf
For additional information visit our website: www.nuways-ag.com/research

Contact for questions:
NuWays AG - Equity Research
Web: www.nuways-ag.com
Email: research@nuways-ag.com
LinkedIn: https://www.linkedin.com/company/nuwaysag
Adresse: Mittelweg 16-17, 20148 Hamburg, Germany
++++++++++
Diese Meldung ist keine Anlageberatung oder Aufforderung zum Abschluss
bestimmter Börsengeschäfte.
Offenlegung möglicher Interessenskonflikte nach § 85 WpHG beim oben
analysierten Unternehmen befinden sich in der vollständigen Analyse.
++++++++++

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1970959 20.08.2024 CET/CEST

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