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Original-Research: DO & CO AG - from NuWays AG

15.08.2025 / 09:00 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 DO & CO AG

Company Name: DO & CO AG
ISIN: AT0000818802

Reason for the research: Update
Recommendation: BUY
from: 15.08.2025
Target price: EUR 266.00
Target price on sight of: 12 months
Last rating change:
Analyst: Henry Wendisch

Q1 defies travel fears, growth continues across all segments

Yesterday, DOC released strong Q1 results defying the fear of slowing air
travel. Against this backdrop, the guidance was also confirmed. In detail:

Q1 revenues increased by 11% yoy to EUR 612m, driven by growth across all
segments: Airline Catering (AC) grew by +11% yoy to EUR 467m on the back of
ongoing and past customers wins, e.g. Delta Airlines at JFK, but also thanks
to continuously growing demand with existing customers. International Event
Catering (IEC) grew against a tough comparable base (EURO 2024) by +10% yoy
to EUR 100m thanks to strong performances in F1 (one more race and good
locations compared to Q1'24) as well solid utilizations at sport events
(UEFA CL and FIFA Club WC) as well as music concerts. Restaurants, Lounges
and Hotels (RLH) also showed a strong development with revenues of EUR 44m
(+8% yoy) driven by growth across all three subdivisions on the back of
unbroken demand. In general, Q1 sales growth could have been ever higher,
but was hindered by a negative FX effect of EUR 30m (i.e. +16% yoy sales
growth in constant currency).

Q1 marked a new EBIT record as it expanded by 44% yoy to EUR 53m (8.6% margin,
up 2pp yoy and 0.1pp qoq). Generally speaking, the main driver was the
improved gross margin (+2pp yoy) mainly thanks a relative cost reduction in
AC (JFK ramp up costs in Q1'24/25). Out of the absolute EUR 16m yoy EBIT
increase on group level, EUR 13.1m yoy came from AC (16% incremental EBIT
margin), EUR 1.2m yoy came from IEC (13% incremental EBIT margin) and EUR 1.6m
yoy came from RLH (49% incremental EBIT margin) highlighting the strong
margin profile in this segment. On group level, Q1 thus showed a 26%
incremental EBIT margin, highlighting the profitability gains stemming from
a low fixed cost ratio coupled with revenue growth.

On the back of the developments described above, cash generation improved
drastically on a yoy comparison. CFO went up by EUR 20m or 156% yoy to EUR 32.5m
on the back of higher earnings and slightly lower tie up in working capital.
Secondly, investments nearly halved from EUR 18.5m (Q1 24/25) to EUR 9.6m,
resulting in an excellent FCF of EUR 23m (vs. EUR -5.8m in Q1'24/25).

Against prior fears of slowing demand, DOC is experiencing the opposite and
thus reiterated its FY'25/26 guidance of 8-10% sales growth but specified
the EBIT margin target to the upper end of 8.0-8.5%. In the mid-term, a
continuous momentum is expected (8-10% sales growth annually, EUR 3bn sales
within the next years) with continuously expanding margins due to operating
leverage.

Against this backdrop, we adapt our assumptions to reflect a better than
expected profitability and demand curve into the following years. In effect,
we therefore increase our DCF-based PT to EUR 266 (old: EUR 235) and confirm the
BUY recommendation.

You can download the research here:
https://eqs-cockpit.com/c/fncls.ssp?u=800aacc915a66fe7b45a4de1600d0132
For additional information visit our website:
https://www.nuways-ag.com/research-feed

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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2184366 15.08.2025 CET/CEST

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