Trading and Debt Facilities Update
This announcement contains inside information for the purposes of Article 7 of EU Regulation 596/2014 as retained as part of UK law by virtue of the European Union (Withdrawal) Act 2018 as amended. Upon the publication of this Announcement, this inside information is now considered to be in the public domain.
13 May 2024
ZOO DIGITAL GROUP PLC
("ZOO", the "Group" or the "Company")
Trading and Debt Facility Renewal Update
ZOO Digital Group plc (AIM: ZOO), a leading provider of end-to-end cloud-based localisation and media services to the global entertainment industry, today provides an update on trading and its debt facilities.
Debt Facility and Cash position
Further to the trading statement of 26 March 2024, the Company has since renewed for a further twelve months debt facilities of up to $3 million with HSBC. These facilities remain fully undrawn but provide the Company with enhanced financial flexibility for working capital purposes in an improving market environment.
Year-end net cash on 31 March 2024 was $5.3 million, significantly better than indicated previously following stronger collections than anticipated in the month of March.
Current Trading
Customer demand has continued to recover with March 2024 invoicing the highest month since April 2023 following acceleration of the Company's pipeline. Work has continued to expand throughout March and April 2024 and visibility extends to September 2024. Revenues for FY25 Q1 are expected to be 36% up on FY24 Q4 which, together with recently implemented cost savings, is expected to result in EBITDA at break-even in Q1.
The Company has now received dubbing and subtitling orders from the major film and TV distributor for which it was recently appointed as a primary vendor as referenced in the announcement of 26 March 2024.
ZOO's strategy remains focused on developing and deploying innovative technology to provide leading and differentiated end-to-end services to its customers. This includes the use of Artificial Intelligence to augment and complement processes where applicable. The strategy is achieved through a capital-efficient approach involving production hubs in key locations to provide a 24/7 service offering, which the Board believes will deliver profitable revenue growth.
With market commentators forecasting a return to 2022 levels of entertainment output in 2025, the Board continues to see opportunities to rebuild revenues following the significant industry disruptions of FY24 and is confident of at least meeting FY24 market expectations*.
Notice of Full Year Results
The Company expects to announce full year results for the period to March 2024 in early August 2024.
The persons responsible for arranging for the release of this Announcement on behalf of ZOO are Stuart Green, Chief Executive Officer and Phillip Blundell, Chief Financial Officer of ZOO.
* The Company understands market consensus for FY24 to be revenue of $39.7 million, EBITDA adjusted for share based payments loss of $14.0 million and net cash of $3.7 million.
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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 leading, technology-enabled localisation and media services.
Founded in 2001, ZOO Digital operates from hubs in Los Angeles, London, Dubai, Turkey, South Korea, India, Denmark and Spain with a development and production centre in Sheffield, UK.
The Group provides media services through its platforms that include: ZOOsubs, ZOOdubs and 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, mastering, 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 Paramount Global.
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 placed to capitalise on new market opportunities in a fast-paced and constantly evolving industry.
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