Borussia Dortmund

DE: BVB

Market Cap€353m

Last Close €3.2

The group operates Borussia Dortmund, a leading football club, placed third in the Bundesliga in 2020/21, DFB Super Cup winners in 2019/20, and DFB-Pokal winners in 2020/21. The club has qualified for the Champions League in nine of the last 10 seasons.

Investment summary

Headline FY22 results indicated revenue (€351.6m) was marginally ahead of our expectations (€350.4m) but the achieved net loss of €35.1m was below management’s recently reduced guidance of a loss of €25–29m due to events after the balance sheet date, which led to a re-measurement of player registrations. The company is well-placed to deliver an improved financial performance in FY22/23 if further COVID-19 related restrictions can be avoided. Our forecasts are under review and will be updated following the publication of full financial statements. Our last-quoted valuation of €9.8/share suggested significant upside in a normalised operating environment.

Y/E Jun	Revenue (€m)	EBITDA (€m)	PBT (€m)	EPS (fd) (c)	P/E (x)	P/CF (x)
2020A	370.2	63.0	45.6	46.77	6.8	4.9
2021A	334.2	39.0	24.3	26.28	12.2	7.8
2022E	350.4	81.5	65.8	57.43	5.6	4.2
2023E	389.0	106.5	91.5	76.23	4.2	3.3

Industry outlook

Unsustainable spend on wages and transfers is increasingly being penalised by UEFA Financial Fair Play requirements. A ‘break-even requirement’ obliges clubs to spend no more than they generate over a rolling three-year period. Sanctions vary from a warning to a ban from UEFA competition, fines and a cap on wages and squad size.

Last updated on 03/10/2022