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

31.01.2025 / 09:00 CET/CEST
Dissemination of a Research, transmitted by EQS News - a service of EQS
Group.
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: 31.01.2025
Target price: EUR 5.50
Target price on sight of: 12 months
Last rating change:
Analyst: Philipp Sennewald

Final TV marketing distribution released; New HC incoming

Topic: Following the award of the domestic TV rights in December, where the
DFL achieved a 2% increase compared to the previous cycle (click here for
update), the Executive Committee of the DFL now unanimously adopted the
mechanism for distributing the revenues from the 25/26-28/29 cycle. In
detail:

Strengthened central marketing. EUR 50m of the total additional proceeds of EUR
80m will be used to finance growth projects that will benefit all clubs by
strengthening the centrally marketed rights. Clubs will contribute to this
in accordance with their respective share of the distribution key.

Fan and media relevance. Going forward, within the "interest" pillar,
national TV ratings and the number of club members will be taken into
account. This should ultimately benefit BVB, as the club is 2nd in both club
members and TV ratings.

Solidarity. The annual solidarity payments to Bundesliga 2 clubs will
increase from EUR 8.5m to EUR 10m. In addition, an amount of five million euros
per season will be distributed to the Bundesliga clubs that do not play
internationally, which will be financed from the DFL's international media
revenue. This on the other hand will be slightly negative for BVB, as the
club is likely going to play internationally in all seasons of the upcoming
cycle.

Talent. The "young talent" pillar will be adjusted to give greater weighting
to match appearances of young players trained in Germany. This should
benefit BVB, as the club as renowned across Europe for its ability to
develop talented, young players.

Overall, the changes to the distribution are only minor, which is why we
continue to estimate an average increase in domestic media revenues for BVB
of 2% going for the upcoming cycle.

UCL. Last Wednesday, BVB beat Shakhtar Donetsk in the last game of the
league phase, which BVB finished in 10th position, meaning the club will
play in the play-offs in February. Here, BVB will play against either
Sporting Lisbon or Club Brugge (draw today at 12am). Both opponents should
be seen as clear underdogs against Dortmund, which is why we continue to
expect the club to reach the round of 16, where BVB would play against
either Lille or Aston Villa. In our view, either of both teams should be
beatable as well, thus providing a certain upside to our current estimate
(round of 16).

New head coach. Following Wednesday's match, CSO Lars Ricken confirmed, that
Niko Kovac will become new head coach starting on Sunday. Kovac is not a
blank slate in the Bundesliga, having coached Eintracht Frankfurt, Bayern
Munich and Wolfsburg in the past. During his stints at Franfkurt and Munich,
he was able to win two national cups as well as the one championship. In our
view, clearly display his potential as a coach during his time in Frankfurt,
while his jobs in Croatia, Munich, Monaco and Wolfsburg ended in him being
sacked based on lack of success. Yet, especially in his first season with
Monaco he had a point average of 2.05 and qualified for the UCL, which also
has to be seen as a success. Overall, while Kovac might not seem as a
perfect fit at first glance, he had successful periods in the past and has
proven his ability to win titles. That being said, he certainly has the
tools to exploit the high potential of the squad, which he can already prove
in February, when BVB will play a total of six games (4x Bundesliga, 2x
UCL).

Reiterate BUY with an unchanged PT of EUR 5.50 based on DCF.

You can download the research here: http://www.more-ir.de/d/31695.pdf
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++++++++++
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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2078495 31.01.2025 CET/CEST

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