REG - Zoo Digital Group - AGM Statement and Trading Update

Zoo DigitalAnnouncement

28/09/2023 07:00

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RNS Number : 8935N  Zoo Digital Group PLC  28 September 2023

28 September 2023

ZOO DIGITAL GROUP PLC

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

 

AGM Statement and Trading 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, will hold its Annual General Meeting (AGM) at 5.00pm BST today.
At the meeting, Gillian Wilmot, Chairman, will make the following statement:

"The market disruption and temporarily subdued demand for localisation and
media services outlined in the full year results on 10 August 2023 are
continuing. Major media organisations are in the process of realigning for
profitability, and industrial action by writers and actors is ongoing.
Consequently, visibility remains limited, and resolution of the strikes is
essential for normal order flow to resume. There has been encouraging progress
over the last week in negotiations between the Writers' Guild of America and
the Association of Motion Pictures and Television Producers resulting in a
provisional deal that it is expected will pave the way for writers to resume
work.

"Despite this progress, the ongoing disruption continues to have a significant
short-term impact and market expectations for ZOO's FY24 outcome assumed
former order levels would resume from October 2023. This  now looks unlikely,
and therefore a range of revenue outcomes for the second half of the financial
year is possible ranging from a similar level to the first half to an increase
in revenue in Q4.

"Whilst orders are being processed monthly, they have been and continue to be
at historically low levels such that H1 revenues are expected to be
approximately $21 million, leading to a significant EBITDA loss for the first
half of the current financial year. However, the Company is in a strong
financial position with net cash at 30 September 2023 expected to be no less
than $16 million.

"The Board has taken steps to mitigate ZOO's position through the
implementation of cost reductions with the objective of achieving break-even
in respect of fiscal Q4. The terms of the planned acquisition of the Company's
partner in Japan have been renegotiated and the parties have agreed to defer
completion until order flow has normalised.

"The Board is confident that the changes arising from strategic reviews by
ZOO's major customers will be favourable for the Group. These include
accelerated transition to an End-to-End approach, studios engaging with fewer,
more capable suppliers, and greater dependence on ZOOstudio, all of which will
strengthen ZOO's market position. ZOO continues to make good progress in
cementing its relationships with existing and potential new customers even
during this period of temporary disruption.

"ZOO's strategy is in alignment with the needs of its current and potential
customers and the Board expects the Group to be well positioned for enhanced
growth once former order levels resume, in line with our medium and long-term
aspirations. The structural drivers for international, multilingual content
remain firmly in ZOO's favour.

"The Board will manage ZOO's cash position carefully whilst protecting
production capability and capacity to enable a rapid rebound of revenues when
orders return. To support this the Board will continue to pursue small
investments in strategic locations at attractive valuations that strengthen
ZOO's proposition for international dubbing."

Presentation slides that will accompany an investor update following the AGM
will be available on the Company's website later today. Shareholders may
register to join a live stream of the AGM and investor briefing here:
https://www.zoodigital.com/agm-2023 (https://www.zoodigital.com/agm-2023)

The Company intends to announce its interim financial results for the six
months to 30 September 2023 in November 2023.

This announcement contains inside information as defined in Article 7 of the
Market Abuse Regulation No. 596/2014 ("MAR").  Upon the publication of this
announcement, this inside information is now considered to be in the public
domain. The person responsible for making this announcement is CEO Stuart
Green and CFO Phillip Blundell.

 

 For further enquiries, please contact:

 ZOO Digital Group plc                                                +44 (0) 114 241 3700
 Stuart Green - Chief Executive Officer
 Phillip Blundell - Chief Finance Officer

 Kam Bansil - Investor Relations

 Stifel Nicolaus Europe Limited (Nominated Adviser and Joint Broker)  +44 (0) 20 7710 7600
 Fred Walsh / Erik Anderson / Tom Marsh / Richard Short

 Singer Capital Markets (Joint Broker)                                +44 (0) 20 7496 3000
 Shaun Dobson / Asha Chotai

 Instinctif Partners (Financial PR)                                   +44 (0) 207 457 2020
 Matthew Smallwood / Joe Quinlan                                      zoo@instinctif.com

 

 

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.

www.zoodigital.com (http://www.zoodigital.com/)

 

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