Good to see you again

Borussia Dortmund 26 May 2020 Update
Download PDF

Borussia Dortmund

Good to see you again

Q320 results

Travel & leisure

26 May 2020

Price

€6.3

Market cap

€580m

Net cash (€m) at 31 March 2020
(including finance leases)

6.2

Shares in issue

92.0m

Free float

59.9%

Code

BVB

Primary exchange

Frankfurt

Secondary exchange

N/A

Share price performance

%

1m

3m

12m

Abs

(2.0)

(30.3)

(30.8)

Rel (local)

(11.1)

(21.8)

(27.1)

52-week high/low

€10.0

€4.6

Business description

The group operates Borussia Dortmund, a leading German football cub, Bundesliga runners-up in 2018/19, DFB Super Cup winners in 2019/20 and DFB Cup winners in 2016/17. The club has qualified for the Champions League in eight of the last nine seasons.

Next events

FY20 results

August 2020

Analysts

Russell Pointon

+44 (0)20 3077 5757

Neil Shah

+44 (0)20 3077 5700

Borussia Dortmund is a client of Edison Investment Research Limited

Borussia Dortmund’s Q320 results were positive from a profit and cash flow perspective despite the impact of COVID-19 at the end of the period. The Bundesliga has led the way in recommencing games after the season was temporarily suspended, albeit games are to be played behind closed doors, which will lead to lost ticket revenue (among other revenues). Borussia Dortmund is well placed to qualify for the Champions League in the 2020/21 season if the current season can be completed. We downgrade our EBITDA forecast for FY20 by c 49%, to reflect lost revenue due to COVID-19 and lower net transfer income. The share price looks well supported by asset valuations.

Year
end

Revenue*
(€m)

EBITDA
(€m)

PBT**
(€m)

EPS**
(€)

DPS
(€)

P/E
(x)

EV/EBIDA

(x)

06/18

313.3

137.3

121.8

1.21

0.06

5.2

4.2

06/19

369.3

116.0

101.5

0.88

0.06

7.2

5.0

06/20e

379.1

65.4

51.5

0.45

0.00

14.1

8.8

06/21e

424.8

125.5

110.4

0.96

0.06

6.6

4.6

Note: *Before player transactions. **PBT and EPS are normalised, excluding amortisation of acquired intangibles, exceptional items and share-based payments.

Q320: Improved profitability and cash flow

Borussia Dortmund’s underlying EBITDA, excluding net transfer income, improved from a loss in Q319 to a profit in Q320 despite two fewer games played, including one that was temporarily suspended due to COVID-19. Revenue declined by 4.7%, with all revenue streams ex Advertising and Miscellaneous declining due to fewer games. Profitability was helped by cost savings due to fewer games, as well as good management of costs generally. Year to date, EBITDA ex-net transfer income has increased by 31.6%, and net transfer income has reduced by 49.5%. Given the uncertainty created by COVID-19, management has withdrawn prior guidance, now stating that it will not be possible to generate a net profit in FY20.

Forecasts: FY20 affected by COVID-19

Following the resumption of Bundesliga games, the team is placed second in the league, five points ahead of the fifth-place team and with a superior goal difference (+41 goals vs +19 goals), with seven games to play. We downgrade our FY20 EBITDA forecast by 49% to reflect lower revenue from Match Operations, Merchandising and Catering, lower net transfer income and cost savings. Given our forecast of a net loss for the year, we assume that no dividend will be declared for FY20.

Valuation: Reflecting economic concerns

Following the recent improvement in the share price, the EV/EBITDA multiples for FY20e and FY21e are 8.8x and 4.6x respectively versus the average multiple since FY10 of 5.4x. The higher multiple for FY20e reflects depressed earnings due to COVID-19. Our sum-of-the-parts valuation suggests a share price of €13.64. The current share price therefore reflects enhanced concerns about the outlook and for the continuation of football games.

Q320 results: Improved profitability and cash flow

The end of Q320 saw the first impact of the COVID-19 pandemic, but improved profitability and cash flow despite lower revenue. Revenue fell by 4.7% during the period due to fewer home matches played, including one game that was suspended due to COVID-19. Underlying EBITDA, ie excluding net transfer income, was positive at €0.8m against a loss in Q319 of €3.5m. In the first nine months of FY20 (9M20), EBITDA ex-net transfer income of €44.3m compares with €33.6m in 9M19, an increase of 31.6%.

Exhibit 1: Q320 and 9M20 results

€000s

H119

Q319

9M19

H120

Q320

9M20

Revenue:

- Match Operations

27,346

11,928

39,274

22,627

9,874

32,501

- Advertising

46,518

22,933

69,451

50,540

24,187

74,727

- TV Marketing

105,526

35,996

141,522

113,059

33,005

146,064

- Merchandising

18,190

6,238

24,428

21,193

5,951

27,144

- Conference, Catering & Miscellaneous

16,287

6,630

22,917

29,166

6,798

35,964

Total revenue

213,867

83,725

297,592

236,585

79,815

316,400

Revenue growth y-o-y:

- Match Operations

(17.3%)

(17.2%)

(17.2%)

- Advertising

8.6%

5.5%

7.6%

- TV Marketing

7.1%

(8.3%)

3.2%

- Merchandising

16.5%

(4.6%)

11.1%

- Conference, Catering & Miscellaneous

79.1%

2.5%

56.9%

Total revenue growth

10.6%

(4.7%)

6.3%

Net transfer income

20,432

56,796

77,228

11,205

27,780

38,985

Other operating income

4,160

769

4,929

3,309

762

4,071

Cost of materials

(11,535)

(5,455)

(16,990)

(14,330)

(4,556)

(18,886)

Personnel expenses

(101,286)

(52,054)

(153,340)

(111,465)

(50,123)

(161,588)

Other operating expenses

(68,085)

(30,471)

(98,556)

(70,649)

(25,094)

(95,743)

EBITDA

57,553

53,310

110,863

54,655

28,584

83,239

EBITDA margin

26.9%

63.7%

37.3%

23.1%

35.8%

26.3%

EBITDA ex net transfer income

37,121

(3,486)

33,635

43,450

804

44,254

Depreciation and amortisation

(36,940)

(19,701)

(56,641)

(49,288)

(26,560)

(75,848)

Operating income

20,613

33,609

54,222

5,367

2,024

7,391

Operating margin

9.6%

40.1%

18.2%

2.3%

2.5%

2.3%

Profit after tax

17,629

29,437

47,066

2,960

1,095

4,055

EPS (€)

0.19

0.32

0.51

0.03

0.01

0.04

Source: Borussia Dortmund accounts

By the end of Q320, Borussia Dortmund’s Bundesliga position had improved to second with 51 points from fourth at the end of December. The team was placed behind Bayern Munich (55 points) and ahead of RB Leipzig (50 points) and Borussia Mönchengladbach (49 points), and four points ahead of the fifth-place team, Leverkusen. Borussia Dortmund’s goal difference of +35 was superior to Leverkusen’s +15.

Having been eliminated from the Champions League in the Round of 16 by Paris Saint-Germain and from the DFB Cup by Werder Bremen, the team’s primary focus for the remainder of the season is to finish in the top four and to qualify for the Champions League in the 2020/21 season, which we assume in our forecasts for FY21.

Due to the outbreak of COVID-19, it was announced on 13 March 2020 that all Bundesliga games would be temporarily suspended after the 25th match of the season, from a total of 34 games. As a result, one home match that should have been played during Q320 was not played.

During Q320 there were two fewer home games played, ie five games were played versus seven games played in Q319. Therefore, revenue from most sources was affected to a greater or lesser extent. The only two revenue sources to increase were Advertising, as the addition of new sponsors at the start of the season continued to be a positive, and Miscellaneous, due to a y-o-y increase in fees for players who played for the national team.

Net transfer income of €27.8m in Q320 was lower than the c €56.8m reported in Q319, and the cumulative position to Q320 of €39m compares with c €77m to Q319. Year to date, gross proceeds are similar to FY19, but the unamortised cost of the players sold in FY19 was much lower, thus generating higher income, ie profit in the prior year. During the winter transfer window Borussia Dortmund sold three players and signed two new players: Emre Can from Juventus and Erling Braut Haaland. The latter made a spectacular start with nine goals in eight Bundesliga appearances, and 12 goals in 11 overall appearances. As a reminder from Q220, in accordance with IAS 8.42, Borussia Dortmund changed its accounting so that net income on transfers is now reported as a single line item in the P&L, rather than gross amounts for revenue and unamortised costs etc recognised previously. The net effect is that profitability is not affected, but gross revenue and costs for the group, as previously disclosed, are lower.

Underlying profitability increased in Q320 despite lower revenue from fewer games and lower gains from transfers, as operating costs also benefited from fewer games. The most significant cost, personnel costs, fell by c 4% during Q320 and represented a relatively stable c 62.8% of revenue versus 62.2% in Q319. Year to date, personnel expenses have marginally reduced to 51.1% of revenue. The most important driver of improved underlying EBITDA was a reduction of other operating expenses of c 18% to €25m.

Investment in the playing squad is the primary reason for the c 46% increase in depreciation and amortisation, which represented 24% of revenue year to date versus 19% in FY19.

Cash flow and balance sheet

Year to date, Borussia Dortmund’s negative free cash flow (excluding interest payments and receipts) of €26.8m is similar to the cumulative €26.2m for 9M19, with a higher level of operating cash flow offset by a similar absolute increase in investment in tangibles and intangibles.

In Q320, free cash flow (FCF) of €12.4m was a good improvement on the €9.9m generated in Q319, due to a higher net inflow on transfers, offset in part by lower operating cash flow. The lower operating cash flow was mainly due to the lower level of profit as discussed above.

The company’s cash position improved from €8.1m at the end of December 2019 to €18.8m at the end of March 2020. With no borrowing and lease liabilities of €12.6m the net cash position including leases was €6.2m.

Outlook and near-term COVID-19 sensitivity

Due to the uncertainty created by the COVID-19 pandemic and on whether it is possible to complete the football season, management has withdrawn its prior financial guidance for the full year. The prior guidance was that revenue excluding transfers would be greater than €398m, representing growth of 7.8% y-o-y, and operating income would be in ‘mid-seven figures’, ie c €5m. Management now believes it will not be possible to generate a consolidated net profit in FY20.

The Bundesliga recommenced games over the weekend commencing 15 May 2020, with an elevated and significant level of media attention in overseas countries. There were nine games to play, and the aspiration is to complete all games before the end of June, when the four-year contracts that players enjoy typically expire. Borussia Dortmund had a successful return, beating local rivals, Schalke 04, 4-0 at home, and then beating VfL Wolfsburg 2-0 away. Following completion of the 27th game of the season, the team is placed second in the Bundesliga, and the gap versus the fifth-place team, Borussia Mönchengladbach, has increased to five points. Its goal difference of +41 is superior to Borussia Mönchengladbach’s +19.

As all games are to be played behind closed doors, ie with no fans in attendance, the club will generate no revenue from ticket sales and catering at games, and revenue from merchandising will be lower than previously expected. So long as all games are completed, revenue from the other sources of Advertising (sponsors) and TV Marketing (broadcast) is not at risk in the near term.

Exhibit 2 highlights the revenue sources excluding transfer income for Borussia Dortmund during the last three seasons.

Exhibit 2: Revenue sources

€000s

FY17

FY18

FY19

FY20e

Revenue

- Match Operations

43,915

42,322

44,659

32,501

- Advertising

87,350

93,962

96,813

104,558

- TV Marketing

125,750

122,293

167,349

172,367

- Merchandising

39,452

29,499

29,989

29,989

- Conference, Catering & Miscellaneous

31,908

25,234

30,510

39,663

Total revenue

328,375

313,310

369,320

379,078

% of total revenue

- Match Operations

13%

14%

12%

9%

- Advertising

27%

30%

26%

28%

- TV Marketing

38%

39%

45%

45%

- Merchandising

12%

9%

8%

8%

- Conference, Catering & Miscellaneous

10%

8%

8%

10%

Growth y-o-y%

- Match Operations

(4%)

6%

(27%)

- Advertising

8%

3%

8%

- TV Marketing

(3%)

37%

3%

- Merchandising

(25%)

2%

0%

- Conference, Catering & Miscellaneous

(21%)

21%

30%

Total revenue

(5%)

18%

3%

Source: Borussia Dortmund accounts

In FY19, Match Operations, ie revenue from tickets, was €44.7m or 12% of total revenue. Within this, ticket revenue for Bundesliga games represented €28.2m, or c 8% of total revenue. With modest inflation in ticket prices, we estimate that ticket revenue in FY20 is c €1.7m per home game, and therefore lost revenue for the five home games that are to be played behind closed doors is c €8.5m. There are no other potential lost revenues from ticket sales as Borussia Dortmund is competing in just the Bundesliga for the rest of the current season.

In FY19, Merchandising revenue was €30.0m or 8% of total revenue. This revenue is seasonal; Q4 is typically a less important period for sales of merchandise given that launch of new replica kits for the new season etc, are imminent. In FY19, Q4 represented 19% of total Merchandising revenue. Sales of merchandise from the club’s stores on match days are an important revenue source, although the absolute level of these versus online sales and sales made on non-match days is not known.

In FY19, Conference, Catering & Miscellaneous revenue was €30.5m or 21% of revenue. As well as food and beverage sales, it includes other miscellaneous revenues such as fees received for players that play for the national squad and booking fees. Therefore, through the year quarterly revenue trends are volatile. Within this, conference and catering sales represented c €17m, but the breakdown between food and beverage at matches versus other revenues is not disclosed. Therefore, if we assume that catering is evenly split between the four accounting periods, the maximum revenue at risk from fans not attending games is c €4m.

The above potential near-term revenue affects due to the COVID-19 outbreak are the easiest to quantify. Our assumption is that all of the remaining games are completed.

Beyond the above, the greatest near-term risk to forecasts is if the remaining games cannot be played due to re-emergence of the virus and another economic lockdown follows, preventing the season from being finalised. This would raise questions about the other, and more significant revenue sources of Advertising and TV Marketing. Such events would be unprecedented. As we are not party to the terms of the contracts covering these relationships, we believe the company would be liable to repay or not receive the unearned income from any games not played.

In FY19, Advertising was worth €96.8m, 26% of total revenue, and we estimate that it will grow by 8% to €105m in FY20. Year to date, Advertising revenue has grown by 7.6% to €74.7m, and we therefore assume that Q4 will represent €29.8m of revenue. Revenue is earned from long-term sponsorship deals from five key ‘Premium Partners’, four of which are also shareholders. We estimate that these represent approximately half of advertising revenue. The two shirt sponsors have contracts that expire in FY25, and the equipment/kit supplier has a contract that expires in FY28. The remainder is earned from a number of smaller sponsors, ‘Champion Partners’ with terms that are typically for a minimum of one year. If we assume that advertising is earned per game, Q420e advertising per game is €3.3m; therefore, if the season were terminated today, the remaining seven games would represent potential lost revenue of €23.1m, which would drop straight through to the bottom line.

In FY19, TV Marketing was worth €167.3m or 45% of total revenue. Year to date it has grown by 3% to €146.1m, with Q320 down by 8% due to fewer games. Within this, Bundesliga rights represented €98.1m in FY19 and we expect it to grow by 5% to €103m in FY20e, and we therefore expect Q420e revenue of €26.3m. If we assume the revenue is earned pro rata, revenue per game is c €2.9m, and therefore the revenue at risk if the final seven games are not played is €20.3m. Again, it would be difficult to offset this revenue with cost savings.

Longer-term sensitivity

Looking into future seasons, further potential COVID outbreaks could have a greater impact on the company’s financial performance than on the current financial year, but this would depend on when the outbreak occurred and how long it lasted.

For example, an outbreak earlier in the football season may affect revenue as the team might not be able to compete in other competitions beyond the Bundesliga, eg the Champions League and domestic cup competitions. In FY19, participation in the Champions League generated directly identifiable revenue of €75.6m (TV Marketing €68.1m and Match Operations of €7.5m), representing c 20% of total revenue. Competing in the domestic cup generated directly identifiable revenue of €3.8m (TV Marketing €1.2m and Match Operations €2.7m) in FY19, representing c 1% of total revenue. In addition, other revenues that cannot be easily identified, from merchandising etc, may also be affected due to fewer games.

Further travel restrictions could also affect the team’s ability to undertake friendly games around the world and in Germany, as is traditional in pre-season training and during the winter break. In FY19, friendlies represented €6.3m of revenue, or less than 2% of the group total.

Beyond the end of the current season, the more long-term impacts of the impending economic downturn may include increasing difficulty in finding new and/or replacing existing sponsors that have multi-year contracts with the club.

In FY20e, we estimate the key operating costs to be personnel costs at c 58% of revenue; depreciation of fixed assets and amortisation of player contracts at c 24% of revenue; and other operating expenses at c 31% of revenue. There should be some flexibility in personnel costs, albeit the greatest part is the salaries of the players and may vary with the level of success on the pitch. Depreciation and amortisation are non-cash costs that are difficult to vary in the short term. The most significant cost here is the amortisation of player contracts, representing c 86% of this cost. Other operating costs includes: Match Operations costs that vary with the number of games played; advertising costs that vary with the level of Advertising revenue; and other admin costs that could be addressed in the event of lost revenue.

Forecast changes

We downgrade our revenue forecast for FY20e by 3.8% and our EBITDA forecast by 48.9%. Our revenue forecast for FY21e increases by 2.6% but our EBITDA forecast falls by 5.0%.

Exhibit 3: Forecast changes

€000s

FY19

FY20 old

FY20 new

Change

FY21 old

FY21 new

Change

Revenue*

369,320

394,000

379,078

(3.8%)

414,000

424,818

2.6%

Growth y-o-y

N/M

2.6%

5.1%

12.1%

EBITDA

115,983

128,000

65,392

(48.9%)

132,000

125,464

(5.0%)

Margin

31.4%

32.5%

17.3%

31.9%

29.5%

Growth y-o-y

10.4%

(43.6%)

3.1%

91.9%

Operating income

23,501

29,000

(26,006)

N/M

27,000

14,432

(46.5%)

Profit before tax

21,809

28,000

(28,084)

N/M

26,000

11,507

(55.7%)

Profit after tax

17,391

23,000

(38,515)

N/M

21,000

(10,858)

N/M

EPS reported (€)

0.19

0.25

(0.42)

N/M

0.23

(0.12)

N/M

EPS normalised (€)

0.88

1.04

0.45

(57.3%)

1.07

0.96

(10.7%)

DPS (€)

0.06

0.06

0.00

(100.0%)

0.06

0.06

0.0%

Source: Edison Investment Research. Note: *Revenue excludes transfer revenue in accordance with new IAS.

The FY20 revenue forecast of €379.1m compares to management’s prior guidance of greater than €398m. Our revenue forecast reduces due to the lower/lost revenue from Match Operations, Catering and Merchandising in Q420 as a result of the remaining Bundesliga games being played behind closed doors. We assume that all of the remaining games in the season are played.

The downgrade to FY20e EBITDA reflects the lower revenue mentioned above, some operating cost savings and lower net transfer income. There are a number of changes to operating costs given the postponement of games and the fact that these postponed games are to be played behind closed doors. With lower revenue from Match Operations, Merchandising and Catering there should be natural cost savings from not having to pay ground staff, etc. The cost of merchandise and food and beverages should fall in line with lost revenue. In addition, players have elected to waive salaries or take temporary salary reductions, although the details of the latter are unknown. Year to date, net transfer income of €39m compares with c €77m in the first nine months of FY19, and we now assume there will be no more transfers before the end of the season given it has been delayed.

For FY21e, our revenue is upgraded primarily due to the recent addition of a second shirt sponsor. We assume net transfer income of €70m, which is higher than the FY20 estimate of €39m, but lower than the c €83m that we estimate was earned in FY19. We assume that no dividend is declared for FY20 to reflect negative reported operating income and profit after tax.

Valuation

Using our new forecasts, at the current share price of €6.3, the EV/Sales multiples for FY20e and FY21e are 1.5x and 1.3x, versus the average since FY10 of 1.4x. The company’s peak EV/Sales multiple was 2.4x in FY19. The EV/EBITDA multiples for FY20e and FY21e are 8.8x and 4.6x respectively versus the average multiple since FY10 of 5.4x. The higher multiple for FY20e reflects depressed earnings due to COVID-19.

The valuation of the playing squad per Transfermarkt.com on 20 May 2020 was €586m, representing a premium of 123% to the book value of the playing squad at the end of Q320. A simple sum-of-the-parts, in which we inflate the current book value of the squad to Transfermarkt.com’s valuation, and include the last-quoted valuation of the brand from May 2018 by Brand Finance of €587m, produces a valuation for Borussia Dortmund of €13.64, a premium of 117% to the current share price.

The current share price therefore reflects wider concerns about the impact of COVID-19 on the wider economy and the ability for football games to continue.

Exhibit 4: Financial summary

€'000s

2014

2015

2016

2017

2018

2019

2020e

2021e

30-June

IFRS

IFRS

IFRS

IFRS

IFRS

IFRS

IFRS

IFRS

INCOME STATEMENT

Revenue

 

 

256,280

263,601

281,261

328,375

313,310

369,320

379,078

424,818

EBITDA

 

 

49,132

55,594

86,668

74,073

137,306

115,983

65,392

125,464

Normalised operating profit

 

 

40,976

46,025

75,798

62,597

126,150

103,160

53,571

113,329

Amortisation of acquired intangibles

(22,523)

(32,865)

(31,899)

(51,939)

(66,814)

(65,850)

(79,577)

(98,897)

Exceptionals

0

0

(7,469)

0

(20,362)

(13,809)

0

0

Share-based payments

0

0

0

0

0

0

0

0

Reported operating profit

18,453

13,160

36,430

10,658

38,974

23,501

(26,006)

14,432

Net Interest

(3,889)

(7,159)

(2,104)

(1,567)

(4,336)

(1,705)

(2,078)

(2,925)

Joint ventures & associates (post tax)

27

0

8

28

13

13

0

0

Exceptionals

0

0

0

0

0

0

0

0

Profit Before Tax (norm)

 

 

37,114

38,866

73,702

61,058

121,827

101,468

51,493

110,404

Profit Before Tax (reported)

 

 

14,591

6,001

34,334

9,119

34,651

21,809

(28,084)

11,507

Reported tax

(2,621)

(469)

(4,898)

(910)

(2,946)

(4,418)

(10,431)

(22,365)

Profit After Tax (norm)

30,447

35,828

63,188

54,965

111,469

80,913

41,062

88,039

Profit After Tax (reported)

11,970

5,532

29,436

8,209

31,705

17,391

(38,515)

(10,858)

Minority interests

(310)

(281)

(245)

0

0

0

0

0

Net income (normalised)

30,137

35,547

62,943

54,965

111,469

80,913

41,063

88,041

Net income (reported)

11,660

5,251

29,191

8,209

31,705

17,391

(38,515)

(10,858)

Basic average number of shares outstanding (m)

61,425

92,000

92,000

92,000

92,000

92,000

92,000

92,000

EPS - basic normalised (€)

 

 

0.49

0.39

0.68

0.60

1.21

0.88

0.45

0.96

EPS - diluted normalised (€)

 

 

0.49

0.39

0.68

0.60

1.21

0.88

0.45

0.96

EPS - basic reported (€)

 

 

0.19

0.06

0.32

0.09

0.34

0.19

(0.42)

(0.12)

Dividend (€)

0.10

0.00

0.06

0.06

0.06

0.06

0.00

0.06

Revenue growth (%)

#REF!

2.9

6.7

16.8

(-4.6)

17.9

2.6

12.1

EBITDA Margin (%)

19.2

21.1

30.8

22.6

43.8

31.4

17.3

29.5

Normalised Operating Margin

16.0

17.5

26.9

19.1

40.3

27.9

14.1

26.7

BALANCE SHEET

Fixed Assets

 

 

249,492

289,509

302,765

354,858

351,405

371,715

371,917

341,844

Intangible Assets

61,602

96,340

65,278

141,521

120,342

163,710

167,732

139,795

Tangible Assets

184,502

189,518

188,423

184,664

180,693

184,001

180,180

178,045

Investments & other

3,388

3,651

49,064

28,673

50,370

24,004

24,004

24,004

Current Assets

 

 

42,803

97,030

121,780

123,739

134,207

128,356

109,795

137,642

Stocks

5,921

9,376

10,158

8,978

5,588

4,569

28,629

32,083

Debtors

14,923

29,680

51,072

48,776

22,981

30,061

30,855

34,578

Cash & cash equivalents

17,852

53,739

51,722

49,297

59,464

55,865

12,450

33,119

Other

4,107

4,235

8,828

16,688

46,174

37,861

37,861

37,861

Current Liabilities

 

 

(71,014)

(61,627)

(78,811)

(140,912)

(119,026)

(128,067)

(151,062)

(159,695)

Creditors

(59,927)

(58,327)

(69,587)

(128,707)

(113,949)

(119,779)

(145,453)

(154,086)

Tax and social security

(571)

(803)

(5,212)

(732)

(1,962)

(811)

(811)

(811)

Short term borrowings

(8,889)

0

0

0

0

0

0

0

Finance leases

(1,627)

(2,497)

(2,640)

(10,295)

(1,969)

(3,127)

(3,127)

(3,127)

Other

0

0

(1,372)

(1,178)

(1,146)

(4,350)

(1,671)

(1,671)

Long Term Liabilities

 

 

(76,032)

(38,834)

(36,192)

(25,383)

(23,001)

(17,085)

(19,764)

(19,764)

Long term borrowings

(32,139)

0

0

0

0

0

0

0

Finance leases

(20,142)

(21,630)

(18,990)

(8,695)

(6,726)

(8,381)

(8,381)

(8,381)

Other long-term liabilities

(23,751)

(17,204)

(17,202)

(16,688)

(16,275)

(8,704)

(11,383)

(11,383)

Net Assets

 

 

145,249

286,078

309,542

312,302

343,585

354,919

310,885

300,027

Minority interests

(334)

(305)

0

0

0

0

0

0

Shareholders' equity

 

 

144,915

285,773

309,542

312,302

343,585

354,919

310,885

300,027

CASH FLOW

Op Cash Flow before WC and tax

45,270

48,435

84,572

72,534

132,983

111,914

63,314

122,539

Working capital

(6,672)

(20,851)

29,052

31,488

(9,402)

17,345

821

1,455

Exceptional & other

(4,649)

(3,193)

(76,641)

13,868

52,171

19,556

(36,907)

(67,075)

Tax

(3,879)

(200)

(320)

(5,476)

(1,723)

(2,834)

(10,431)

(22,365)

Net operating cash flow

 

 

30,070

24,191

36,663

112,414

174,029

145,981

16,796

34,554

Capex

(10,923)

(10,399)

(9,442)

(8,139)

(7,195)

(9,872)

(8,000)

(10,000)

Net investment in intangibles

2,058

(61,682)

(20,038)

(96,526)

(135,556)

(129,458)

(44,614)

(960)

Acquisitions/disposals

0

0

(500)

(45)

0

0

0

0

Net interest

(3,644)

(7,244)

(1,435)

(2,002)

(3,668)

(1,456)

(2,078)

(2,925)

Equity financing

5

140,708

1

0

0

0

0

0

Dividends

(6,523)

(6,451)

(5,124)

(5,519)

(5,519)

(5,519)

(5,519)

0

Other

(5,727)

(43,236)

(2,142)

(2,608)

(11,924)

(3,275)

0

0

Net Cash Flow

5,316

35,887

(2,017)

(2,425)

10,167

(3,599)

(43,415)

20,669

Opening net debt/(cash) incl financial leases

53,932

44,945

(29,612)

(30,092)

(30,307)

(50,769)

(44,357)

(942)

FX

0

0

0

0

0

0

0

0

Other non-cash movements

3,671

38,670

2,497

2,640

10,295

(2,813)

0

0

Closing net debt/(cash) incl financial leases

44,945

(29,612)

(30,092)

(30,307)

(50,769)

(44,357)

(942)

(21,611)

Source: Company accounts, Edison Investment Research

General disclaimer and copyright

This report has been commissioned by Borussia Dortmund and prepared and issued by Edison, in consideration of a fee payable by Borussia Dortmund. Edison Investment Research standard fees are £49,500 pa for the production and broad dissemination of a detailed note (Outlook) following by regular (typically quarterly) update notes. Fees are paid upfront in cash without recourse. Edison may seek additional fees for the provision of roadshows and related IR services for the client but does not get remunerated for any investment banking services. We never take payment in stock, options or warrants for any of our services.

Accuracy of content: All information used in the publication of this report has been compiled from publicly available sources that are believed to be reliable, however we do not guarantee the accuracy or completeness of this report and have not sought for this information to be independently verified. Opinions contained in this report represent those of the research department of Edison at the time of publication. Forward-looking information or statements in this report contain information that is based on assumptions, forecasts of future results, estimates of amounts not yet determinable, and therefore involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of their subject matter to be materially different from current expectations.

Exclusion of Liability: To the fullest extent allowed by law, Edison shall not be liable for any direct, indirect or consequential losses, loss of profits, damages, costs or expenses incurred or suffered by you arising out or in connection with the access to, use of or reliance on any information contained on this note.

No personalised advice: The information that we provide should not be construed in any manner whatsoever as, personalised advice. Also, the information provided by us should not be construed by any subscriber or prospective subscriber as Edison’s solicitation to effect, or attempt to effect, any transaction in a security. The securities described in the report may not be eligible for sale in all jurisdictions or to certain categories of investors.

Investment in securities mentioned: Edison has a restrictive policy relating to personal dealing and conflicts of interest. Edison Group does not conduct any investment business and, accordingly, does not itself hold any positions in the securities mentioned in this report. However, the respective directors, officers, employees and contractors of Edison may have a position in any or related securities mentioned in this report, subject to Edison's policies on personal dealing and conflicts of interest.

Copyright: Copyright 2020 Edison Investment Research Limited (Edison).

Australia

Edison Investment Research Pty Ltd (Edison AU) is the Australian subsidiary of Edison. Edison AU is a Corporate Authorised Representative (1252501) of Crown Wealth Group Pty Ltd who holds an Australian Financial Services Licence (Number: 494274). This research is issued in Australia by Edison AU and any access to it, is intended only for "wholesale clients" within the meaning of the Corporations Act 2001 of Australia. Any advice given by Edison AU is general advice only and does not take into account your personal circumstances, needs or objectives. You should, before acting on this advice, consider the appropriateness of the advice, having regard to your objectives, financial situation and needs. If our advice relates to the acquisition, or possible acquisition, of a particular financial product you should read any relevant Product Disclosure Statement or like instrument.

New Zealand

The research in this document is intended for New Zealand resident professional financial advisers or brokers (for use in their roles as financial advisers or brokers) and habitual investors who are “wholesale clients” for the purpose of the Financial Advisers Act 2008 (FAA) (as described in sections 5(c) (1)(a), (b) and (c) of the FAA). This is not a solicitation or inducement to buy, sell, subscribe, or underwrite any securities mentioned or in the topic of this document. For the purpose of the FAA, the content of this report is of a general nature, is intended as a source of general information only and is not intended to constitute a recommendation or opinion in relation to acquiring or disposing (including refraining from acquiring or disposing) of securities. The distribution of this document is not a “personalised service” and, to the extent that it contains any financial advice, is intended only as a “class service” provided by Edison within the meaning of the FAA (i.e. without taking into account the particular financial situation or goals of any person). As such, it should not be relied upon in making an investment decision.

United Kingdom

This document is prepared and provided by Edison for information purposes only and should not be construed as an offer or solicitation for investment in any securities mentioned or in the topic of this document. A marketing communication under FCA Rules, this document has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and is not subject to any prohibition on dealing ahead of the dissemination of investment research.

This Communication is being distributed in the United Kingdom and is directed only at (i) persons having professional experience in matters relating to investments, i.e. investment professionals within the meaning of Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the "FPO") (ii) high net-worth companies, unincorporated associations or other bodies within the meaning of Article 49 of the FPO and (iii) persons to whom it is otherwise lawful to distribute it. The investment or investment activity to which this document relates is available only to such persons. It is not intended that this document be distributed or passed on, directly or indirectly, to any other class of persons and in any event and under no circumstances should persons of any other description rely on or act upon the contents of this document.

This Communication is being supplied to you solely for your information and may not be reproduced by, further distributed to or published in whole or in part by, any other person.

United States

Edison relies upon the "publishers' exclusion" from the definition of investment adviser under Section 202(a)(11) of the Investment Advisers Act of 1940 and corresponding state securities laws. This report is a bona fide publication of general and regular circulation offering impersonal investment-related advice, not tailored to a specific investment portfolio or the needs of current and/or prospective subscribers. As such, Edison does not offer or provide personal advice and the research provided is for informational purposes only. No mention of a particular security in this report constitutes a recommendation to buy, sell or hold that or any security, or that any particular security, portfolio of securities, transaction or investment strategy is suitable for any specific person.

Frankfurt +49 (0)69 78 8076 960

Schumannstrasse 34b

60325 Frankfurt

Germany

London +44 (0)20 3077 5700

280 High Holborn

London, WC1V 7EE

United Kingdom

New York +1 646 653 7026

1,185 Avenue of the Americas

3rd Floor, New York, NY 10036

United States of America

Sydney +61 (0)2 8249 8342

Level 4, Office 1205

95 Pitt Street, Sydney

NSW 2000, Australia

Frankfurt +49 (0)69 78 8076 960

Schumannstrasse 34b

60325 Frankfurt

Germany

London +44 (0)20 3077 5700

280 High Holborn

London, WC1V 7EE

United Kingdom

New York +1 646 653 7026

1,185 Avenue of the Americas

3rd Floor, New York, NY 10036

United States of America

Sydney +61 (0)2 8249 8342

Level 4, Office 1205

95 Pitt Street, Sydney

NSW 2000, Australia

General disclaimer and copyright

This report has been commissioned by Borussia Dortmund and prepared and issued by Edison, in consideration of a fee payable by Borussia Dortmund. Edison Investment Research standard fees are £49,500 pa for the production and broad dissemination of a detailed note (Outlook) following by regular (typically quarterly) update notes. Fees are paid upfront in cash without recourse. Edison may seek additional fees for the provision of roadshows and related IR services for the client but does not get remunerated for any investment banking services. We never take payment in stock, options or warrants for any of our services.

Accuracy of content: All information used in the publication of this report has been compiled from publicly available sources that are believed to be reliable, however we do not guarantee the accuracy or completeness of this report and have not sought for this information to be independently verified. Opinions contained in this report represent those of the research department of Edison at the time of publication. Forward-looking information or statements in this report contain information that is based on assumptions, forecasts of future results, estimates of amounts not yet determinable, and therefore involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of their subject matter to be materially different from current expectations.

Exclusion of Liability: To the fullest extent allowed by law, Edison shall not be liable for any direct, indirect or consequential losses, loss of profits, damages, costs or expenses incurred or suffered by you arising out or in connection with the access to, use of or reliance on any information contained on this note.

No personalised advice: The information that we provide should not be construed in any manner whatsoever as, personalised advice. Also, the information provided by us should not be construed by any subscriber or prospective subscriber as Edison’s solicitation to effect, or attempt to effect, any transaction in a security. The securities described in the report may not be eligible for sale in all jurisdictions or to certain categories of investors.

Investment in securities mentioned: Edison has a restrictive policy relating to personal dealing and conflicts of interest. Edison Group does not conduct any investment business and, accordingly, does not itself hold any positions in the securities mentioned in this report. However, the respective directors, officers, employees and contractors of Edison may have a position in any or related securities mentioned in this report, subject to Edison's policies on personal dealing and conflicts of interest.

Copyright: Copyright 2020 Edison Investment Research Limited (Edison).

Australia

Edison Investment Research Pty Ltd (Edison AU) is the Australian subsidiary of Edison. Edison AU is a Corporate Authorised Representative (1252501) of Crown Wealth Group Pty Ltd who holds an Australian Financial Services Licence (Number: 494274). This research is issued in Australia by Edison AU and any access to it, is intended only for "wholesale clients" within the meaning of the Corporations Act 2001 of Australia. Any advice given by Edison AU is general advice only and does not take into account your personal circumstances, needs or objectives. You should, before acting on this advice, consider the appropriateness of the advice, having regard to your objectives, financial situation and needs. If our advice relates to the acquisition, or possible acquisition, of a particular financial product you should read any relevant Product Disclosure Statement or like instrument.

New Zealand

The research in this document is intended for New Zealand resident professional financial advisers or brokers (for use in their roles as financial advisers or brokers) and habitual investors who are “wholesale clients” for the purpose of the Financial Advisers Act 2008 (FAA) (as described in sections 5(c) (1)(a), (b) and (c) of the FAA). This is not a solicitation or inducement to buy, sell, subscribe, or underwrite any securities mentioned or in the topic of this document. For the purpose of the FAA, the content of this report is of a general nature, is intended as a source of general information only and is not intended to constitute a recommendation or opinion in relation to acquiring or disposing (including refraining from acquiring or disposing) of securities. The distribution of this document is not a “personalised service” and, to the extent that it contains any financial advice, is intended only as a “class service” provided by Edison within the meaning of the FAA (i.e. without taking into account the particular financial situation or goals of any person). As such, it should not be relied upon in making an investment decision.

United Kingdom

This document is prepared and provided by Edison for information purposes only and should not be construed as an offer or solicitation for investment in any securities mentioned or in the topic of this document. A marketing communication under FCA Rules, this document has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and is not subject to any prohibition on dealing ahead of the dissemination of investment research.

This Communication is being distributed in the United Kingdom and is directed only at (i) persons having professional experience in matters relating to investments, i.e. investment professionals within the meaning of Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the "FPO") (ii) high net-worth companies, unincorporated associations or other bodies within the meaning of Article 49 of the FPO and (iii) persons to whom it is otherwise lawful to distribute it. The investment or investment activity to which this document relates is available only to such persons. It is not intended that this document be distributed or passed on, directly or indirectly, to any other class of persons and in any event and under no circumstances should persons of any other description rely on or act upon the contents of this document.

This Communication is being supplied to you solely for your information and may not be reproduced by, further distributed to or published in whole or in part by, any other person.

United States

Edison relies upon the "publishers' exclusion" from the definition of investment adviser under Section 202(a)(11) of the Investment Advisers Act of 1940 and corresponding state securities laws. This report is a bona fide publication of general and regular circulation offering impersonal investment-related advice, not tailored to a specific investment portfolio or the needs of current and/or prospective subscribers. As such, Edison does not offer or provide personal advice and the research provided is for informational purposes only. No mention of a particular security in this report constitutes a recommendation to buy, sell or hold that or any security, or that any particular security, portfolio of securities, transaction or investment strategy is suitable for any specific person.

Frankfurt +49 (0)69 78 8076 960

Schumannstrasse 34b

60325 Frankfurt

Germany

London +44 (0)20 3077 5700

280 High Holborn

London, WC1V 7EE

United Kingdom

New York +1 646 653 7026

1,185 Avenue of the Americas

3rd Floor, New York, NY 10036

United States of America

Sydney +61 (0)2 8249 8342

Level 4, Office 1205

95 Pitt Street, Sydney

NSW 2000, Australia

Frankfurt +49 (0)69 78 8076 960

Schumannstrasse 34b

60325 Frankfurt

Germany

London +44 (0)20 3077 5700

280 High Holborn

London, WC1V 7EE

United Kingdom

New York +1 646 653 7026

1,185 Avenue of the Americas

3rd Floor, New York, NY 10036

United States of America

Sydney +61 (0)2 8249 8342

Level 4, Office 1205

95 Pitt Street, Sydney

NSW 2000, Australia

Share this with friends and colleagues