26 January 2021

ZOO DIGITAL GROUP PLC

("ZOO", the "Group" or the "Company")

Trading Update

Strong trading

ZOO Digital Group plc, a world-leading provider of cloud-based localisation and media services to the global entertainment industry, today provides an update on current trading and outlook for the financial year ending March 2021. 

Since the half year, ZOO has continued to see the benefits of its cloud-based offering and ability to undertake projects remotely. Whilst new productions have been on hold due to the COVID-19 pandemic, the Group continues to see increased workflow from preparing back catalogue titles for digital distribution globally, although the volume of this work is not expected to continue at such high levels once new production returns to normal. As a result, revenues for the full year are now expected to be at least $38 million (FY20: $29.8 million), an acceleration of growth in the second half over the first half of 35%. Based on this strong performance, the result for the year is anticipated to be ahead of market expectations.

It is encouraging to note that some new productions have restarted more recently. In addition, there has been expansion of budgets by major industry players as streaming becomes mainstream, with content being sourced more broadly from international producers. These trends are underpinned by rising consumer spending on content.

The pandemic has provided ZOO with the opportunity to increase its engagement with dubbing customers due to the differentiated benefits of its cloud technology over a period when the Board believes its major competitors have experienced revenue declines. The Company has been well placed to meet changing market requirements as the digital transformation of the industry has been accelerated. This endorses ZOO's business model and strategy which the Board believes will support continued growth once new productions resume.

The Group has also added new customers during the period that are expected to contribute during the 2022 financial year.

The Company continues to invest in its technology and growing its international footprint. A wide range of enhancements have been made to the Company's ZOOstudio platform to further embed it in customer operations whilst ZOOdubs has been extended and ZOO's dubbing service expanded geographically through investment in people in new markets, cementing its technology leadership.

Stuart Green, Chief Executive Officer, said:

"ZOO Digital has traded very strongly and is pioneering and innovating the services it provides to the global entertainment industry. Our technology-first, cloud-based approach has positioned the Group very well to meet market requirements during and subsequent to the pandemic, despite the disruption caused to new production.

"ZOO is a trusted partner to major media companies and through our end-to-end service model, which brings together comprehensive localisation and media services, we are able to support major studios and streaming services as they globalise their content to reach audiences worldwide.

"We are investing in growing our global footprint as well as benefiting from the resumption of content creation and digitally remastering back catalogues for the global market."

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About ZOO Digital Group plc:

ZOO Digital supports major Hollywood studios and streaming services to globalise their content and reach audiences everywhere, by providing world-leading, technology-enabled localisation and media services.

Founded in 2001, ZOO Digital operates from hubs in Los Angeles, London and Dubai, with a development and production centre in Sheffield, UK. The company is targeting $100m sales in the medium term.

The Group provides media services through its platforms that include: ZOOsubs, ZOOdubs, ZOOstudio. Its full-service proposition delivers the end-to-end services required to prepare both original and catalogue content for digital distribution; these services include dubbing, subtitling & captioning, metadata creation & localisation, artwork localisation and media processing. Alongside this offering, ZOO also provides its customers with management platforms and strategic solutions to support their own internal globalisation operations.

ZOO is a go-to service partner for media businesses looking to globalise their content across different territories, languages and distribution platforms. Using its innovative technology-enabled approach, ZOO helps its customers to reduce time to market, lower costs and deliver high quality products to their global audiences. The business has frameworks in place with all major Hollywood studios and streaming services. Its customers include Disney, NBCUniversal, HBO and ViacomCBS.

ZOO's competitive advantage arises from three interlinking factors - the leading role it has played in the digital transformation of its sector; the world class proprietary platforms that it develops to enable this transformation; and the global supply chain of thousands of freelancers, working collaboratively in ZOO's platforms, which delivers services that scale easily to meet demand. These factors combine to make ZOO uniquely geared to capitalise on new market opportunities in a fast-paced and constantly evolving industry.