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
Target price:	EUR 5
Target price on sight of:	12 months
Last rating change:
Analyst:	Philipp Sennewald

Early CL exit weighs on FY25/26p; chg.

On Friday, BVB published preliminary FY25/26 figures, showing a declining top line and profitability on the back of the early UCL exit. In detail:

FY25/26p sales declined 12.5% yoy to € 460m (eNuW: € 475m), almost entirely explained by TV Marketing sales, which were down 25.9% to € 168m (eNuW: € 174m). Here, the UCL play-off round exit (vs quarter finals in FY24/25) alone accounted for € 31m of the decline, while the FIFA Club World Cup, which straddled the fiscal year end, contributed € 23m less. On top, Bundesliga TV money declined € 5.5m, as the new four-year DFL contract distributes revenues linearly, whereas the previous deal followed a step-up model. Match Operations fell 8.9% to € 50.3m on two UCL home games less, while Merchandising (€ 38.7m) and Conference, Catering & Others (€ 45.1m) softened by 3.4% and 9.7% respectively. Importantly, Advertising grew a further 2.8% yoy to € 158m (eNuW: € 161m) despite weaker on-pitch performance and lower success bonuses, underlining the strength of the BVB brand as a marketing platform.

Net transfer result was up 56.7% yoy to € 59.3m, as gross transfer proceeds reached € 76.8m (vs € 63.6m prior year), mainly triggered by the sale of Jamie Gittens to Chelsea. Including these, gross total operating proceeds stood at € 537.2m.

EBITDA of € 92.2m (-20.4% yoy; eNuW: €104m) was cushioned by disciplined cost management, visible in reduced personnel expenses, on the back of lower performance-linked pay as well as lower travel expenses.

FY26/27 guidance implies operational step-up. Management guides for sales of € 485-495m, EBITDA of € 118-128m and net income of € 0-10m, with FCF of € -10 to -20m on infrastructure capex. Key assumptions are the direct UCL qualification via Bundesliga finish and the round of 16 in both the DFB Cup and the UCL. Notably, targeted EBITDA is broadly in line with FY24/25 (€ 116m) despite € 40m lower sales and assumed gross transfer proceeds of only € 45m. However, we view this as reasonable based on lower squad costs following the departure of veteran players such as Süle or Brandt and targeted cost-cutting. Moreover, the € 11m extra revenue for a potential UCL round of 16 would come at a high incremental margin as it only incurs performance bonuses.

To the on-pitch outlook. BVB kicked-off their season on Saturday but was defeated by Bayern in the Supercup, which still generated € 2m in premium payments. As aforementioned, the team got a fresh look over the summer, adding promising talents like Karetsas, Gadou or Konstantelias as well as the more experienced Veerman. While beating Bayern for the Bundesliga title is in our view close to impossible, given the strength of the Bavarian squad, BVB is set for another top-3 finish. For the UCL, the prediction is harder as one bad game can end the campaign. Yet, with BVB being top-10 in the UEFA club coefficient, the round of 16 should clearly be in the cards. Mind you, should BVB advance beyond that stage, additional high-margin premium payments would follow, i.e. an extra € 12.5m for the quarterfinals.

Reiterate BUY with an unchanged PT of € 5.00 based on DCF.

You can download the research here: borussia-dortmund-gmbh-co-kgaa-2026-08-25-previewreview-en-3768f
For additional information visit our website: https://www.nuways-ag.com/research

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NuWays AG - Equity Research
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