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Original-Research: ZEAL Network SE - from NuWays AG

19.09.2025 / 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
result of this research does not constitute investment advice or an
invitation to conclude certain stock exchange transactions.

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Classification of NuWays AG to ZEAL Network SE

Company Name: ZEAL Network SE
ISIN: DE000ZEAL241

Reason for the research: Update
Recommendation: BUY
from: 19.09.2025
Target price: EUR 65.00
Target price on sight of: 12 months
Last rating change:
Analyst: Henry Wendisch

FY'25 guidance raised amid strong demand; chg. est & PT

Yesterday after market close, ZEAL has raised its FY'25 guidance. Here's our
take:

As flagged before, ZEAL has increased its guidance. FY'25 sales are now
expected between EUR 205-215m (prev.: EUR 195-205m), which is in line with our
estimate (eNuW: EUR 212m). Also, FY'25 EBITDA is guided between EUR 63-68m
(prev.: EUR 55-60m) and is now ahead of our old estimate (eNuW old: EUR 61m),
likely because we overestimated the ramp-up in personnel. The reason behind
the guidance hike should stem from strong demand at "Traumhausverlosung" as
well as a higher lottery gross margin.

This week on Monday, the raffle for a "Dream House" at a popular beach
vacation spot (St. Peter-Ording) took place, which likely experienced higher
demand than initially expected. To put this into perspective, ZEAL has now
raffled 4 houses thus far and has disclosed KPIs for the first three houses.
The three houses have generated total billings of EUR 26m. After deducting
lottery tax (12% of billings or EUR 3.1m), payments for charities (21% of
billings or EUR 5.4m) and prizes (eNuW: currently 19% of billings or EUR 4.8m),
this should have left a sales effect of EUR 12.6m (or 48% of billings =
current gross margin of "Traumhausverlosung"). The data highlights the
strong impact on sales from this new product type. Regarding the fourth
raffle from last Monday, it seems like ZEAL has hit a sweet spot and found a
perfect house that was desired by a lot of users. Supported by strong
performance marketing campaigns over the last weeks leading up to the
raffle, we expect strong MAUs and consequently strong billings of more than
EUR 11m, thus triggering sales of more than EUR 5.5m for ZEAL from the fourth
house raffle (vs. EUR 4.2m on average at the first three raffles).

Moreover, Q3 experiences a modest lottery environment, until today, where
the Eurojackpot peaks at EUR 120m. During the phase leading up to and during
the peak jackpots, user activity (and spending) already starts to build up
and nearly doubles. More importantly, with higher activity, the product mix
also improves towards higher margin products like "lottery pools" or "team
player". Consequently, ZEAL already sees a strong gross margin improvement
at lotteries (partially also boosted by the strong gross margin from
"Traumhausverlosung"), as written in yesterday's release. Mind you, the
price increases from mid-2024 are now falling out of the comparable base (as
of Q3'25), thus not serving as a growth driver anymore, supporting our view
of a product-mix driven gross margin improvement. Should today's Eurojackpot
not be hit and develop into a streak during the remainder of the year (as
seen in Q4'24), a further guidance hike might also be in the cards, in our
view.

Against this backdrop, we reiterate our BUY recommendation with a slightly
raised PT of EUR 65.00 (old: EUR 64.00), based on DCF.

You can download the research here:
https://eqs-cockpit.com/c/fncls.ssp?u=0ebc470b0b611003d4a4b6bcf1573edc
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
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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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2200070 19.09.2025 CET/CEST

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