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Sep 30, 2019

Finances and football combine in first digital report from Borussia Dortmund

Football club changes approach to financial reporting

In 2000, Borussia Dortmund, the German football team, became the first club to list on the Frankfurt Stock Exchange. Last week the club undertook another new step with the launch of its first digital annual report

‘In order to exploit the potential of digital financial communication and to react to the increasing digitization of reporting, we decided to take the next step in reporting,’ says Thomas Treß, CFO at Borussia Dortmund.

With the Dortmund report, the company has to take into account the diverse nature of the readers. Many of the club's shareholders are also fans, so they are interested in sporting success as much as financial returns. 

On the one hand, readers can access the hard numbers through HTML versions of the management report and financial statements, along with interactive tools such as a chart generator. On the other, there is a ‘sporting highlights’ section, where you can scroll through a timeline of the 2018/2019 season, which saw Dortmund pipped to the German league title by rivals Bayern Munich.

‘With our online report we not only address the typical members of the financial community,’ says Treß. ‘Fans and supporters are also a target audience of our digital investor relations work [as well as] a major shareholder group.’

Digital annual reports are now fairly common practice in Europe. Nearly two in five European companies currently produce a digital version of the annual report, according to yet-to-be published research by nexxar, which designed Dortmund’s new report, and Message Group. 

‘Our research covers more than 500 companies and their reports from 13 different countries,’ says Eloy Barrantes, CEO at nexxar. ‘In total 212 (39 percent) of the analyzed international top companies already publish a digital annual report. The leading European markets are Switzerland (70 percent), Germany (60 percent) and Belgium (55 percent).’

Dortmund is one of the few European clubs to remain publicly listed. During the late 1990s and early 2000s, there was a trend for European football clubs to join the stock market. But today most have delisted, given the difficulty of reconciling shareholder returns with success on the field. 

The STOXX Europe Football Index contains only 22 clubs, including Scotland’s Celtic, Italy’s Juventus and the Netherland’s Ajax. 

Investors in Dortmund have experienced a wild ride similar to that of football fans following their team. Listed at €11 ($12), the shares lost 80 percent of their value over the next five years as the club grappled with heavy debts. 

Hans-Joachim Watzke, a German entrepreneur, took over as CEO in 2005 and is often credited as the main who saved the club from bankruptcy. The shares continued to sink lower, however, and dropped below one euro during the financial crisis. 

But since then the share price has climbed steadily, boosted by the global bull market in equities, and now sits just below the original listing price at around €9.50.