REG - Zoo Digital Group - Interim Results
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RNS Number : 0730I Zoo Digital Group PLC 19 November 2025
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 persons responsible for making this announcement are CEO Stuart
Green and CFO Robert Pursell.
19 November 2025
ZOO DIGITAL GROUP PLC
("ZOO," the "Group" or the "Company")
INTERIM RESULTS FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2025
Restructured operations generating cash; on track to deliver FY26 results in
line with market expectations
Analyst & Investor Presentations
ZOO Digital Group plc (LON: ZOO), a world-leading provider of cloud-based
localisation and digital media services to the global entertainment industry,
announces its unaudited financial results for the six months ended 30
September 2025 ("H1 FY26").
Summary
Key Financials
· Revenues decreased by 19% to $22.4 million (H1 FY25: $27.6 million
/ H2 FY25: $22.0 million). Revenue stabilisation on H2 FY25 as the industry
begins to recover and H1 FY25 benefited from the backlog of work from the FY24
Hollywood strikes.
· Gross profit was unchanged at $10.1 million (H1 FY25: $10.1
million), on lower revenues, benefiting from the cost rationalisation
programme implemented and the growth in Media Services.
· Gross profit margin increased to 45% (H1 FY25: 37%).
· Adjusted EBITDA(1) increased by 18% to $2.0 million (H1 FY25:
$1.7 million).
· Cash EBITDA(2) $0.6 million (H1 FY25: loss of $0.1 million) shows
underlying operations now generating cash.
· Operating loss of $1.2 million (H1 FY25: loss of $2.5 million).
· Gross cash balance of $3.3 million at period end (H1 FY25: $4.3
million / H2 FY25: $2.7 million) with strong focus on cash management.
· $1.7 million drawn on the invoice financing facilities (H1 FY25:
$0.5 million / H2 FY25: $0.0 million); as a result of the proactive decision
to reduce aged creditors in the period.
· Current liabilities reduced to $14.4 million (H1 FY25: $18.7
million).
(1) EBITDA with the impact of share-based payments removed
(2) Adjusted EBITDA less spend on capitalised development and property costs.
This metric is more closely aligned with the underlying cash flow of the
business.
Further information on Alternative Performance Measures is in the notes to the
interim financial statements.
Operational Highlights
· Previously announced cost saving initiatives fully implemented.
o Created a more efficient, flexible and cash generative cost base.
o Improved gross margin percentage.
o H1 FY26 fixed costs of $15.5 million (H1 FY24: $23.2 million)
· Generated positive Cash EBITDA.
· First premium Fast Track projects delivered and proven for global
streaming service.
o Dubbing delivered in 24 hours (typical industry delivery timelines of 2 to
3 weeks).
o Subtitling delivered in 3 hours (typical industry delivery timelines of 1
to 2 weeks).
o Higher-margin service deploys workflow technology with "Human in the Loop"
to uphold premium quality of output.
o Completed several localisation projects attracting high viewing figures;
demand now expanding beyond localisation to ZOO's full end-to-end services.
o Additional projects underway covering sporting events and near live
content launches.
· AI integrated into multiple workflows.
o Explicit customer approval for adoption of AI in localisation within ZOO's
secure and trusted framework.
o Efficiencies now being delivered with cost savings shared with customers.
o Workflows enhanced alongside "Human in the Loop," assuring the quality
demanded by customers is maintained.
o Published update to AI white paper, establishing ZOO as a thought leader
on the integration of AI into the localisation of premium media content.
· International operations fully integrated.
o All international operations now fully trained on ZOO workflows and
quality standards.
o Creating benefits in expanding dubbing capabilities, also acting as
ingestion and delivery points for local content being licensed by our
customers.
o India production centres fully functional and continuing to grow,
increasing efficiencies and supporting ZOO's follow-the-sun strategy.
Current Trading and Outlook
ZOO has seen increasing momentum during H1 FY26, with Q2 outperforming Q1 on
all financial metrics, and a growing number of new opportunities and projects
being progressed as customers become more settled in their content strategies
and restructured operations. While the transactional nature of our business
offers limited visibility of revenues for the duration of H2, we are trading
in line with our expectations and are confident that we remain on track to
deliver full year results in line with market expectations.(3)
Through the remainder of FY26 we expect to make further progress in developing
existing customer relationships by deploying ZOO's tech-enabled proposition to
enhance their end-to-end localisation and digital media strategies, and we are
targeting to increase our market share and a return to revenue growth in FY27.
Stuart Green, CEO of ZOO Digital, commented:
"These results demonstrate that ZOO has started to turn the corner following
industry disruption. We are now on a more solid footing with a rightsized cost
base, stable revenues, improved profitability, and generating cash. We are
focused on improving our working capital position, investing in our
technology, and further expanding our existing international operations. To
have achieved this whilst integrating AI into our workflows - contributing to
the launch of our market-leading Fast Track service - and completing an
international reorganisation of our business, is a credit to the hard work of
the team here at ZOO.
"Throughout this we have maintained the high levels of quality demanded by our
customers and have created a foundation on which we believe we can capitalise
on the opportunities we now see in front of us. With certain of our customers
becoming more open to adopting technology to reach global audiences faster, I
believe ZOO is positioned to benefit as the only truly tech-first end-to-end
vendor in our market. We therefore look to the future with a renewed sense of
confidence."
Analyst Presentation
An interim results presentation will be made available on the Company's
website at www.zoodigital.com (http://www.zoodigital.com) .
Stuart Green, Chief Executive Officer and Robert Pursell, Chief Financial
Officer, will host an online presentation for sell-side equity analysts,
followed by Q&A, at 10:00 GMT today. Analysts wishing to join should
register their interest by contacting: ZOO@vigoconsulting.com
(mailto:ZOO@vigoconsulting.com) .
Investor Engagement
Management will hold an online presentation for private investors at 17:00 GMT
today. For those interested in joining, please register via the following
link: https://www.zoodigital.com/interims2026
(https://www.zoodigital.com/interims2026) . A recording of the webinar will be
made available via the Company's website afterwards.
(3) For the purpose of this announcement, the Group believes market consensus
for FY26 to be revenue of $42.3 million, and adjusted EBITDA of
$3.8 million.
For further enquiries please contact:
ZOO Digital Group plc +44 114 241 3700
Stuart Green - Chief Executive Officer
Robert Pursell - Chief Financial Officer
Canaccord Genuity (Nominated Adviser and Broker) +44 20 7523 8000
Simon Bridges / Harry Gooden / Andrew Potts / George Grainger
Vigo Consulting (Financial Communications) +44 20 7390 0230
Tim McCall / Rozi Morris / Joe Quinlan ZOO@vigoconsulting.com (mailto:ZOO@vigoconsulting.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, Spain, Italy and Germany 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/)
CHAIRMAN AND CHIEF EXECUTIVE'S STATEMENT
Overview
Trading in H1 FY26 marked a period of revenue stabilisation as the industry
began to recover from the disruptions of recent years. The entertainment
localisation and media services sector has experienced significant volatility
- first benefiting from increased content consumption during the Covid
pandemic and the rapid expansion of streaming platforms in FY22 and FY23, then
facing headwinds from customer reorganisations and the writers' and actors'
strikes in FY24. While H1 FY25 saw a temporary uplift due to the backlog of
delayed work, revenues in H2 FY25 and H1 FY26 have held steady at
approximately $22 million in each period.
During this phase of consolidation, ZOO has taken proactive steps to
strengthen its business. We have completed a strategic restructuring to right
size the cost base to support the current revenue levels, fully integrated our
international operations, launched a premium "Fast Track" localisation
service, and embedded AI across our workflows. These initiatives have created
a leaner, more agile operating model, tailored to our clients' evolving needs,
and have positioned ZOO to capture a greater share of a growing market.
Market
Global content spending reached $210 billion in 2024, growing at a compound
annual rate of 10% (KPMG - The Future of Content Spend and Business Models in
Media). Within this, the localisation services market is estimated at
$3 billion (Slator Language Industry Market Report), with approximately half
of that spend attributed to major US studios and streaming platforms - giving
ZOO an addressable market of at least $1.5 billion.
Streaming platforms have moved beyond their hypergrowth phase and are now
focused on profitability and subscriber retention. Localisation plays a
central role in this strategy, enabling content to reach global audiences and
maximise return on investment. For original content, localisation typically
includes both dubbing and subtitling, with costs representing just 1-3% of the
overall content budget but delivering significant uplift in viewership and
engaging subscribers in international growth markets.
We are also seeing incremental demand for live and near-live content,
particularly in sports and time-sensitive episodic programming, as streamers
expand into traditional broadcast territory. Meanwhile, traditional studios
are adapting to the increasing role of streaming providers, which now accounts
for a greater share of TV consumption than broadcast and cable combined
(Nielsen 2025). This shift has prompted more data-driven content strategies
and widespread industry reorganisation, including the acquisition of Paramount
Global by Skydance Media and the potential sale of Warner Bros. Discovery.
With the focus on profitability and changing business models we have seen an
increase in the proportion of content being licensed compared with new
original titles. This can be a more cost-effective and quicker way of
generating new programming on a streaming platform but often requires the
content to be reformatted, which is work ZOO is able to perform through its
Media Services offering. Licensed content can also require localisation
services, but this tends to be exclusively through subtitling due to the
higher cost of dubbing.
With a desire for simplified vendor engagement and a focus on premium quality
we are also seeing a shift in procurement behaviour. Customers are moving away
from fragmented regional partnerships toward working with fewer, full-service,
global "end-to-end" providers. ZOO is one of the few companies capable of
fulfilling this requirement. In a sign of an industry returning to
business-as-usual following prolonged disruption, we have recently seen a
significant increase in Request for Proposal (RFP) activity, which we believe
reflects both our market positioning and growing customer confidence in their
content strategies.
Historically, some clients required dubbing partners to use local studios with
on-site voice artists, engineers, and directors. ZOO's decentralised model,
powered by proprietary workflow technology, eliminates the need for dedicated
physical studios, enabling remote collaboration and faster delivery. As
deadlines shorten and budgets tighten, we believe our flexible and efficient
approach is increasingly valued, leading to opportunities to work within new
channels giving greater access to the localisation spend within our customer
base.
Adoption of Technology
Technology continues to play an increasingly central role in the localisation
industry, with artificial intelligence (AI) now at the forefront of
innovation. ZOO has long championed a tech-first approach to the complex
challenge of delivering high-quality, localised media content at speed and
scale across global streaming platforms.
The first wave of AI investment across the industry has largely focused on
development. The next phase, application, is where we believe real
transformation will occur. ZOO is already actively involved in this shift,
integrating AI into its workflows for certain clients to enhance service
delivery while maintaining the high standards and security expected by our
clients.
Since 2001, ZOO has pioneered the use of technology in localisation,
disrupting traditional practices through cloud-based workflows and
decentralised localisation and media services. This approach enables us to
deliver fast, secure, end-to-end services at the highest standards of quality.
As the industry evolves, these capabilities are becoming increasingly
essential, and we believe the market is moving further in ZOO's direction.
ZOO's AI-enhanced workflows are overseen by skilled linguists and editors,
enabling faster turnaround times without compromising quality. This
dramatically reduces time-to-market, unlocks new possibilities for clients to
localise emerging content types with a premium service offering, and future
proofs ZOO's position in the market.
As with most technical innovations there are always concerns, and this is
certainly true in our industry with AI. Several of our customers explicitly
require that AI is not used due to their concerns about quality, security and
copyright. We will always ensure our processes meet the highest standards
and prioritise security and copyright protection above all. We have
implemented a flexible, hybrid framework enabling us to match our services
with the specific requirements of each customer. This is typical of how we
partner with customers to build tailored solutions for their needs, leading to
trusted, longstanding industry relationships.
Operations
Whilst the comparator period included a backlog of work following the hiatus
caused by the Hollywood writers and actors strikes, we believe the period
under review represents a "normalisation" of business as the industry has
stabilised.
· Revenue of $22.4 million (H1 FY25: $27.6 million)
· Adjusted EBITDA(1) margin 9% (H1 FY25: 6%)
· Cash EBITDA(2) $0.6 million (H1 FY25: loss of $0.1 million).
· OPEX as a % of revenue 50% (H1 FY25: 46%)
· Operating loss margin 5% (H1 FY25: loss of 9%)
· Freelancer network grew to 12,335 (H1 FY25: 12,112)
· External quality score(3) of 99.9% (H1 FY25: 98.8%)
(1) Adjusted for share-based payments.
(2) Calculated as Adjusted EBITDA less capitalised development costs and
less property costs included in depreciation and finance costs (as per
IFRS16).
(3) Weighted average of quality scores given by customers on our work
delivered in the period. In H1 FY26 we received quality scores on work that
accounted for 58% of revenue (H1 FY25: 61%).
Further information on Alternative Performance Measures is provided in the
notes to the interim financial statements.
( )
The $10.9 million cost saving initiatives previously announced have now been
completed, supporting a return to cash generation, whilst ensuring we
protected the capability and infrastructure of the business to deliver high
quality end-to-end services. International operations from previous
acquisitions and investments have now been fully integrated into our core
business allowing us to operate on a truly global level and leverage our
"follow the sun" strategy to reduce delivery times and give greater
flexibility to our customers. During this period, we have maintained the high
quality of work performed with a quality score of 99.9% in the period (from
those customers that provide quality score feedback). Based on feedback from
our customers the Board believes that this score places ZOO amongst the
highest performers in the industry.
For certain of our customers, we have now integrated AI into several of our
workflows, improving productivity and scalability by supporting skilled human
experts to achieve high levels of accuracy and authenticity as well as
shortening the time-to-market of entertainment products. Whilst there is still
caution in the industry regarding the use of AI, this gives customers the
option to utilise the benefits AI can bring on their own terms. We believe
that ZOO's proprietary tech-enabled proposition, and long history of working
with the major US studios, gives us the credibility to help our customers to
embrace the opportunities of AI whilst preserving the "human in the loop" to
assure quality. The Company recently published a new edition of its white
paper titled "The Future of Media Localisation" providing further analysis of
how we believe AI can be utilised in localisation services and establishing
ZOO as a thought leader in the industry.
Fast Track
As streamers increasingly commission live and near-live content on their
platforms, they face the challenge of distributing this content to global
audiences without losing its time-sensitive appeal. ZOO has created a tailored
solution with its premium "Fast Track" offering which we believe to be unique
in the industry. Fast Track is made possible by ZOO's model, bringing together
our extensive freelancer network, workflow technology, "follow the sun" 24
hours a day capability and AI integrations. As a result, we have been able to
prepare subtitles within just 3 hours and delivered dubbing within 24 hours.
This has been confirmed by our customers to achieve the same quality standard
as other providers that take 1 to 2 weeks for subtitling and 2 to 3 weeks for
dubbing. We have already completed several Fast Track projects, including
premium content, that has since been viewed tens of millions of times around
the world.
In an industry where delivery timelines are more generally being compressed,
Fast Track has shown our customers the real value in the quality that ZOO's
proposition can deliver without the need for reliance on dedicated physical
studios. This has created several additional opportunities for ZOO, including
extending its application across all end-to-end services. Whilst this service
has generated limited revenues to date, given our customers' imperative to
accelerate time to market, we expect it in time to be an important driver for
future growth.
End-to-End Strategy
ZOO's strategy is to provide "end-to-end" services to our customers,
fulfilling all their requirements to prepare content for distribution -
whether that is localisation services, media services, or a combination of
both.
Localisation services include dubbing, subtitling, captioning, Audio
Description, metadata localisation, and artwork localisation. These services
are language-based and creative by nature, for which ZOO uses a combination of
in-house resources and its extensive network of freelancers.
Media services include mastering, audio mixing, transcoding, packaging,
metadata creation, QC and authoring. These tend to be more technical in nature
and mainly utilise in-house resources.
All these services are managed on ZOO's proprietary cloud-based workflow
technology. This allows both technical and creative teams around the world to
work consistently and simultaneously on projects, managed by a distributed
team of project managers and directors, whist adhering to the high levels of
security demanded by our customers. The combination of our in-house resources,
freelance network and technology allow us to respond rapidly to the changing
requirements of our customers.
In H1 FY26 there has been a change in the mix of these services required with
an increase in the proportion of media services. A key driver behind this has
been an increase in the volume of licensed content being acquired by our
customers compared to the level of new original content being produced.
Licensed content is less likely to require localisation, especially dubbing,
but will usually require multiple media services to ensure it meets the
quality requirements and format for distribution. By being one of the few
end-to-end global providers in the industry, ZOO has been able to adapt
quickly to these changes, benefitting from its diversified operations to
maintain revenues and improve margins.
Cost Rationalisation
In H1 FY26 we completed the reorganisation of the business that began in FY24.
This included reducing staff numbers, migration of certain functions to our
new facility in Chennai, India, and multiple initiatives to reduce overheads
especially in the areas of office and IT costs. The results of these changes
have reduced fixed costs, (excluding costs of freelancers and
depreciation/amortisation) from $23.2 million in H1 FY24 to $15.5 million in
H1 FY26. This has been implemented carefully over time to deliver a suitable
cost base to seek to position the business to be cash-generative from a lower
revenue base, whilst ensuring the quality and speed of services we deliver to
our customers has been unaffected. This is evidenced by the resilience of
revenue over the last 12 months alongside the launch of our market leading
solution Fast Track and exceptional external quality scores.
Outlook
The H1 FY26 trading performance was in line with management expectations, and
the Board expects this to continue through to the end of the financial year.
Trading since 30 September 2025 is in line with management expectations and we
remain on track to deliver full year results in line with market expectations.
The emerging requirement amongst streamers for fast turn-around media
localisation services to support accelerated time to market and the global
distribution of live and near-live programming creates new opportunities which
ZOO, using its now proven premium Fast Track service, is well placed to
fulfil.
The Board also believes that more large media companies will transition to the
End-to-End vendor model, partly due to their restructured operations and the
desire to improve efficiency and safeguard quality. As an accomplished and
proven supplier and an innovator in the industry, ZOO can address these
requirements and is currently in discussions regarding several opportunities
and has seen a significant increase in Request for Proposal (RFP) activity.
FINANCIAL REVIEW
Revenues of $22.4 million were in line with management expectations. This was
19% below the same period last year (H1 FY25: $27.6 million) due primarily to
the increased level of work processed in H1 FY25 following the backlog of work
from the FY24 actors' and writers' strikes. Revenues have been stable for the
last 4 quarters with $22.0 million of revenue delivered in H2 FY25.
Gross profit of $10.1 million was in line with the prior period (H1 FY25:
$10.1 million), despite lower revenues, reflecting the improved efficiency
and revenue mix within the business as gross margin increased to 45%
(H1 FY25: 37%).
The Company reports segment contribution by service line, with the service
lines being: 1) Localisation; 2) Media Services; and, for consistency, 3)
Legacy Software Services. The contribution is calculated as revenue less the
attributable direct costs. Unallocated direct costs are reported within gross
margin but not included in the segmental reporting.
Localisation revenues of $11.4 million (H1 FY25: $17.1 million) reduced from
the comparator period due to the backlog of work received in H1 FY25 following
the actors' and writers' strikes, as well as the slowdown in the production of
original content which led to lower demand for dubbing. Localisation gross
profit contribution was $3.1 million (H1 FY25: $5.3 million) with the gross
profit margin reducing to 27% from 31% in H1 FY25. Cost base reductions to
offset the lower revenue were limited to ensure localisation service
capabilities were protected, given ongoing discussions regarding several
significant localisation opportunities.
Media Services revenues of $10.5 million (H1 FY25: $9.9m million) increased on
H1 FY25 due to the greater volume of work relating to customers licensing
third party content. Media Services contribution was $8.0 million (H1 FY25:
$6.8 million) with the gross profit margin increasing to 76% from 68% in H1
FY25 due to increased efficiencies with the expansion and integration of the
Indian operations.
Operating expenses decreased 11% to $11.2 million (H1 FY25: $12.7 million) as
indirect staff were reduced in both the US and the UK. Investment in India,
Germany and Italy continued as the business pivoted to lower-cost production
locations. Additional initiatives to reduce IT, cloud services and property
costs were also completed in the period.
Excluding variable spend on freelancers and third-party studios the cost
rationalisation program has removed $7.7 million (33%) of the fixed cost base
of the business, reducing the total fixed cost base from $23.2 million in H1
FY24 (the first half period prior to the commencement of the cost
rationalisation program) to $15.5 million in H1 FY26.
Adjusted EBITDA was $1.9 million (H1 FY25: $1.7 million), an 18% increase on
H1 FY25, despite lower revenues, with the Adjusted EBITDA as a percentage of
revenue increasing to 9% from 6% in H1 FY25. This improvement in EBITDA
resulted in a reduced operating loss of $1.2 million (H1 FY24: $2.5 million).
The loss before tax for the period was $1.3 million, which compares to a loss
of $2.6 million last year. This reduced loss was due to the cost
rationalisation program improving EBITDA, and a reduction in the amount of
depreciation and amortisation charged, reflecting the utilisation of high
levels of investment in FY23 and FY24 and the reduction in the size of the
workforce.
The cash balance as of 30 September 2025 was $3.3 million (H1 FY25: $4.3
million, H2 FY25: $2.7 million) representing an increase of $0.6 million
from the FY25 year-end position. This included a reduction in trade and other
payables of $5.5 million in H1 FY26 decreasing the level of aged creditors,
and an accelerated conversion of work in progress to debtors.
The Group's cash position of $3.3 million at 30 September 2025 is further
enhanced by $6 million of debt facilities with HSBC ($3.0 million US invoice
financing facility, £2.0 million UK invoice financing facility,
£0.25 million UK overdraft) of which $1.7 million was utilised at the period
end (H1 FY25: $0.5 million).
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
(UNAUDITED)
for the six months ended 30 September 2025
Unaudited Unaudited Audited
6 months to 6 months to Year ended
30 Sep 2025 30 Sep 2024 31 Mar 2025
$000 $000 $000
Revenue 22,385 27,561 49,570
Cost of sales (12,309) (17,451) (31,549)
Gross Profit 10,076 10,110 18,021
Other operating income - -
Operating expenses (11,230) (12,612) (24,499)
Operating loss (1,154) (2,502) (6,478)
Analysed as
EBITDA before share-based payments 1,950 1,658 1,109
Share based payments - (63) -
Depreciation (1,971) (2,905) (5,197)
Amortisation (1,133) (1,192) (2,380)
(1,154) (2,502) (6,468)
Share of profit of associates and JVs - - (48)
Impairment loss on associate - - (1,457)
On sale of associate 10 - -
Finance income 13 25 43
Exchange gain/ (loss) on borrowings (7) 27 20
Other finance cost (212) (214) (422)
Total finance cost (206) (162) (359)
Loss before taxation (1,350) (2,664) (8,342)
Tax on loss 4 41 362
Loss and total comprehensive income for the period attributable to equity (1,346) (2,623) (7,980)
holders of the parent
Profit per ordinary share
-basic (1.40) cents (2.70) cents (8.10) cents
-diluted (1.40) cents (2.70) cents (8.10) cents
CONSOLIDATED STATEMENT OF FINANCIAL POSITION (UNAUDITED)
As at 30 September 2025
Unaudited as at 30 Sep 2025 Unaudited as at 30 Sep 2024 Audited as at 31 Mar 2025
$000 $000 $000
ASSETS
Non-current assets
Property, plant, and equipment 5,253 8,754 7,218
Intangible assets 13,717 14,827 14,285
Investments 1,591 3,097 1,591
Deferred tax assets 264 104 321
20,825 26,782 23,415
Current assets
Trade and other receivables 8,880 11,799 12,883
Contract assets 2,387 4,645 2,244
Cash and cash equivalents 3,339 4,340 2,714
14,606 20,784 17,841
Total assets 35,431 47,566 41,256
LIABILITIES
Current liabilities
Trade and other payables (10,885) (16,344) (16,160)
Contract liabilities (571) (483) (618)
Borrowings (3,187) (1,837) (1,473)
(14,643) (18,664) (18,251)
Non-current liabilities
Borrowings and other payables (2,387) (3,792) (3,185)
Total liabilities (17,030) (22,456) (21,436)
Net assets 18,401 25,110 19,820
EQUITY
Equity attributable to equity holders of the parent
Called up share capital 1,290 1,284 1,290
Share premium reserve 70,805 70,701 70,805
Other reserves 12,320 12,320 12,320
Share option reserve 2,692 2,748 2,692
Capital redemption reserve 6,753 6,753 6,753
Merger reserve 1,326 1,326 1326
Foreign exchange translation reserve (211) (156) (138)
Accumulated losses (76,511) (69,803) (75,165)
18,464 25,173 19,883
Interest in own shares (63) (63) (63)
Attributable to equity holders 18,401 25,110 19,820
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (UNAUDITED)
As at 30 September 2025
Ordinary shares Share premium reserve Foreign exchange translation reserve Share option reserve Capital redemption reserve Merger reserve Other reserves Accumu-lated losses Interest in own shares Total
$000 $000 $000 $000 $000 $000 $000 $000 $000 $000
Balance at
1April 2024 1,284 70,683 (152) 2,685 6,753 1,326 12,320 (67,185) (63) 27,651
Share options exercised - 18 - - - - - - - 18
Deferred tax on share options - - - - - - - 5 - 5
Share-based payments - - - 63 - - - - - 63
Transactions with owners - 18 - 63 - -- - 5 - 86
Loss for the period - - - - - - - (2,623) - (2,623)
Foreign exchange translation - - (4) - - - - - - (4)
Total comprehensive income for the period - - (4) - - - - (2,623) - (2,627)
Balance at
30 September 2024 1,284 70,701 (156) 2,748 6,753 1,326 12,320 (69,803) (63) 25,110
Share options exercised - (18) - 7 - - - - - (11)
Deferred tax on share options - - - - - - - (5) - (5)
Share-based payments - - - (63) - - - - - (63)
Issue of share capital 6 122 - - - - - - - 128
Transactions with owners 6 104 - (56) - - - (5) - 49
Foreign exchange translation - - 18 - - - - - - 18
Loss for the period - - - - - - - (5,357) - (5,357)
Total comprehensive income for the period - - 18 - - - - (5,357) - (5,339)
Balance at
31 March 2025 1,290 70,805 (138) 2,692 6,753 1,326 12,320 (75,165) (63) 19,820
Share based payments - - - - - - - - - -
Share options exercised - - - - - - - -
Transactions with owners - - - - - - - - - -
Loss for the period - - - - - - - (1,346) - (1,346)
Foreign exchange translation - - (73) - - - - - - (73)
Total comprehensive income for the period - - (73)- - - - - (1,346) - (1,419)
Balance at 1,290 70,805 (1211) 2,692 6,753 1,326 12,320 (76,511) (63) 18,401
30 September 2025
CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED)
for the six months ended 30 September 2025
30 Sep 2025 30 Sep 2024 31 Mar 2025
Unaudited Unaudited Audited
6 months to
30 Sep 2025 6 months to Year ended
$000 30 Sep 2024 31 Mar 2025
$000 $000
Cash flows from operating activities
Operating (loss)/profit for the period (1,154) (2,502) (6,478)
Depreciation 1,971 2,905 5,197
Amortisation 1,133 1,192 2,390
Share based payments - 63 -
Disposal of property, plant, and equipment - - -
Changes in working capital:
(Increases)/decreases in trade and other receivables 3,860 (2,390) (1,074)
Increases/(decreases) in trade and other payables (5,322) 1,420 1,073
Cash flow from operations 488 688 1,108
Tax (paid)/received 61 278 377
Net cash flow from operating activities 549 966 1,485
Investing Activities
Purchase of intangible assets (1) (2) (7)
Capitalised development costs (564) (902) (1,519)
Purchase of subsidiaries (net of cash acquired) - - (30)
Purchase of investments - - -
Purchase of property, plant, and equipment (6) (265) (731)
Disposal of associate 10 - -
Payment of deferred consideration - (300) -
Finance income 13 25 43
Net cash flow from investing activities (548) (1,444) (2,244)
Cash flows from financing activities
Repayment of borrowings - - -
Proceeds from borrowings 1,702 453 -
Repayment of principal under lease liabilities (793) (750) (1,585)
Finance cost (212) (214) (388)
Share options exercised - 18 7
Issue of share capital - - 128
Transaction costs for issue of share capital - - -
Net cash flow from financing 697 (493) (1,838)
Net Increase in cash and cash equivalents 698 (971) (2,597)
Cash and cash equivalents at the beginning of the period 2,714 5,315 5,315
Exchange loss on cash and cash equivalents (73) (4) (4)
Cash and cash equivalents at the end of the period 3,339 4,340 2,714
NOTES TO THE INTERIM FINANCIAL STATEMENTS
General information
ZOO Digital Group plc ('the Company') and its subsidiaries (together 'the
Group') provide end-to-end cloud-based localisation and media services to the
global entertainment industry and continue with on-going research and
development to enhance the Group's core offerings. The Group has operations in
the UK, the US, India, Europe, and South Korea.
The Company is a public limited company which is listed on the AIM market of
the London Stock Exchange and is incorporated and domiciled in the UK. The
address of the registered office is Castle House, Angel Street, Sheffield. The
registered number of the Company is 3858881.
This condensed consolidated financial information is presented in US dollars,
the currency of the primary economic environment in which the Group operates.
The interim results were approved by the board of directors on 19 November
2025.
This consolidated interim financial information has not been audited.
Basis of preparation
The consolidated financial statements of ZOO Digital Group plc and its
subsidiary undertakings for the period ending 31 March 2026 will be prepared
in accordance with UK adopted international accounting standards and the
requirements of the Companies Act 2006.
This Interim Report has been prepared in accordance with UK AIM listing rules
which require it to be presented and prepared in a form consistent with that
which will be adopted in the annual accounts having regard to the accounting
standards applicable to such accounts. It has not been prepared in accordance
with IAS 34 "Interim Financial Reporting".
The policies applied are consistent with those set out in the annual report
for the year ended 31 March 2025, and have been consistently applied, unless
stated otherwise.
This condensed consolidated financial information is for the six months ended
30 September 2025. It has been prepared with regard to the requirements of
IFRS. It does not constitute statutory accounts as defined in S343 of the
Companies Act 2006. It does not include all of the information required for
full annual financial statements and should be read in conjunction with the
consolidated financial statements of the Group for the year ended 31 March
2025 which contained an unqualified audit report and have been filed with the
Registrar of Companies. They did not contain statements under s498 of the
Companies Act 2006.
The Group has applied the same accounting policies and methods of computation
in its interim consolidated financial statements as in its 2025 annual
financial statements, except for those that relate to new standards and
interpretations effective for the first time for periods beginning on (or
after) 1 April 2025 and will be adopted in the 2026 financial statements.
There are no standards materially impacting the Group that will be required to
be adopted in the annual financial statements for the year ending 31 March
2026.
Basis of Consolidation
The consolidated financial statements of ZOO Digital Group plc include the
results of the Company and its subsidiaries. Subsidiary accounting policies
are amended where necessary to ensure consistency within the Group and intra
group transactions are eliminated on consolidation.
Going concern
The Group's financial statements are prepared on a going concern basis despite
the losses incurred in the period. The Group continues to have a strong order
pipeline, has significant cash reserves and available financial facilities.
Segment reporting
Operating segments are reported in a manner consistent with the internal
reporting regularly reviewed by the Group's chief operating decision maker to
make decisions about resource allocation to the segments and to assess their
performance.
Localisation Media services Software Services Total
FY26 H1 FY25 H1 FY26 H1 FY25 H1 FY26 H1 FY25 H1 FY26 H1 FY25 H1
$000 $000 $000 $000 $000 $000 $000 $000
Revenue 11,434 17,133 10,548 9,948 403 480 22,385 27,561
Segment contribution 3,063 5,318 8,044 6,791 294 339 11,401 12,448
Unallocated cost of sales (1,325) (2,338)
Gross profit 10,076 10,110
Gross profit % 27% 31% 76% 68% 73% 71% 45% 37%
Alternative performance measures (APM)
The Group uses certain Alternative Performance Measures (APMs) to enable the
users of the Group's financial statements to understand and evaluate the
performance of the Group consistently over different reporting periods. APMs
are non-GAAP company specific measures. As these are non-GAAP measures, they
should not be considered as replacements for IFRS measures. The Group's
definition of non-GAAP measures may not be comparable to other similarly
titled measures reported by other companies. A description of the measures set
out above is included below with a reconciliation to the closest GAAP
measure.
APM Description Use
Adjusted EBITDA Adjusted EBITDA is a calculated as operating profit/(loss) before depreciation Adjusted EBITDA gives a clearer picture of the core profitability of the group
(including right of use asset depreciation), amortisation and impairment of before the impact of financing and accounting entries and decisions.
intangible assets, share-based payment charge.
Cash EBITDA Cash EBITDA is calculated as Adjusted EBITDA less capitalised development Cash EBITDA gives a clearer picture of how the business is generating cash.
costs and less property costs included in depreciation and finance costs (as Certain salary and property costs are excluded from Adjusted EBITDA. Cash
per IFRS16). EBITDA includes these costs allowing an assessment of how Adjusted EBITDA
converts into cash.
Freelancer Network Measure of freelancers trained and registered on the ZOO platform. Indication of scale of resources available.
External Quality Score Several of ZOO's customers provide internal KPI measures of the quality of our This KPI has replaced the previous quality measure of "Retained Sales" as the
work. Measures vary between companies and are usually derived from multiple Board believes it gives a clearer and independent measure of performance. In
contributing factors, such as on-time delivery and first-time acceptance the period the work assessed accounted for 58% of total revenue (H1 FY25:
rates. The External Quality Score is an average score weighted on the revenue 61%).
of the work being assessed.
Adjusted EBITDA ($000's) H1 FY26 H1 FY25
Operating loss (1,154) (2,502)
Share based payments - 63
Depreciation 1,971 2,905
Amortisation 1,133 1,192
Adjusted EBITDA 1,950 1,658
Cash EBITDA ($000's) H1 FY26 H1 FY25
Adjusted EBITDA 1,950 1,658
Capitalised salary costs (Development costs) (564) (902)
Property costs included in Depreciation (IFRS 16) (652) (678)
Property costs included in Finance Costs (IFRS 16) (161) (207)
Cash EBITDA 573 (129)
Functional and presentation currency
Items included in the financial statements of each of the Group's entities are
measured using the currency of the primary economic environment in which the
entity operates ('the functional currency'). The consolidated financial
statements are presented in US Dollars which is the Group's functional and
presentation currency.
Transactions and balances
Transactions in foreign currencies are recorded at the prevailing rate of
exchange in the month of the transaction. Foreign exchange gains or losses
resulting from the settlement of such transactions and from the translation of
monetary assets and liabilities denominated in foreign currencies at the
year-end exchange rates are recognised in the income statement.
Group companies
The results and financial positions of all Group entities that use a
functional currency different from the presentation currency are translated
into the presentation currency as follows:
· assets and liabilities for each entity are translated at the closing
rate at the period end date.
· income and expenses for each Statement of Comprehensive Income item are
translated at the prevailing monthly exchange rate for the month in which the
income or expense arose, and all resulting exchange rate differences are
recognised in other comprehensive income with the foreign exchange translation
reserve.
Earnings per share
Earnings per share is calculated based upon the profit or loss on ordinary
activities after tax for each period divided by the weighted average number of
shares in issue during the period.
Weighted average number of shares for basic & diluted profit per share 30 Sep 2025 30 Sep 2024 31 Mar 2025
No. of shares No. of shares No. of shares
Basic 97,780,970 97,880,145 97,976,898
Diluted 97,780,970 100,577,564 97,976,898
Where the Group has recorded a loss, diluted earnings per share is equal to
basic earnings per share.
Intangible Assets
Goodwill Customer relationships Development costs Patents and trademarks Computer software Total
$000 $000 $000 $000 $000 $000
Cost
At 1 April 2024 22,476 1,424 20,135 842 271 45,148
Additions - - 902 2 - 904
At 30 September 2024 22,476 1,424 21,037 844 271 46,052
Additions 30 - 617 - 5 652
Exchange differences 4 - - - - 4
At 31 March 2025 22,510 1,424 21,654 844 276 46,708
Additions - - 564 1 - 565
At 30 September 2025 22,510 1,424 22,218 845 276 47,273
Amortisation and impairment
At 1 April 2024 12,620 284 16,229 658 242 30,033
Amortisation - 72 1,096 18 6 1,192
At 30 September 2024 12,620 356 17,325 676 248 31,225
Amortisation - 70 1,104 18 6 1,198
At 31 March 2025 12,620 426 18,429 694 254 32,423
Charge - 71 1,044 13 5 1,133
At 30 September 2025 12,620 497 19,473 707 259 33,556
Net book value
At 30 September 2024 9,856 1,068 3,712 168 23 14,827
At 31 March 2025 9,890 998 3,225 150 22 14,285
At 30 September 2025 9.890 927 2,745 138 17 13,717
Further Copies
Copies of the Interim Report for the six months ended 30 September 2025 will
be available, free of charge, for a period of one month from the registered
office of the Company at Castle House, Angel Street, Sheffield, S3 4LN or from
the Group's website: www.zoodigital.com (http://www.zoodigital.com) .
Alternative performance measures (APM)
The Group uses certain Alternative Performance Measures (APMs) to enable the
users of the Group's financial statements to understand and evaluate the
performance of the Group consistently over different reporting periods. APMs
are non-GAAP company specific measures. As these are non-GAAP measures, they
should not be considered as replacements for IFRS measures. The Group's
definition of non-GAAP measures may not be comparable to other similarly
titled measures reported by other companies. A description of the measures set
out above is included below with a reconciliation to the closest GAAP
measure.
APM Description Use
Adjusted EBITDA Adjusted EBITDA is a calculated as operating profit/(loss) before depreciation Adjusted EBITDA gives a clearer picture of the core profitability of the group
(including right of use asset depreciation), amortisation and impairment of before the impact of financing and accounting entries and decisions.
intangible assets, share-based payment charge.
Cash EBITDA Cash EBITDA is calculated as Adjusted EBITDA less capitalised development Cash EBITDA gives a clearer picture of how the business is generating cash.
costs and less property costs included in depreciation and finance costs (as Certain salary and property costs are excluded from Adjusted EBITDA. Cash
per IFRS16). EBITDA includes these costs allowing an assessment of how Adjusted EBITDA
converts into cash.
Freelancer Network Measure of freelancers trained and registered on the ZOO platform. Indication of scale of resources available.
External Quality Score Several of ZOO's customers provide internal KPI measures of the quality of our This KPI has replaced the previous quality measure of "Retained Sales" as the
work. Measures vary between companies and are usually derived from multiple Board believes it gives a clearer and independent measure of performance. In
contributing factors, such as on-time delivery and first-time acceptance the period the work assessed accounted for 58% of total revenue (H1 FY25:
rates. The External Quality Score is an average score weighted on the revenue 61%).
of the work being assessed.
Adjusted EBITDA ($000's) H1 FY26 H1 FY25
Operating loss (1,154) (2,502)
Share based payments - 63
Depreciation 1,971 2,905
Amortisation 1,133 1,192
Adjusted EBITDA 1,950 1,658
Cash EBITDA ($000's) H1 FY26 H1 FY25
Adjusted EBITDA 1,950 1,658
Capitalised salary costs (Development costs) (564) (902)
Property costs included in Depreciation (IFRS 16) (652) (678)
Property costs included in Finance Costs (IFRS 16) (161) (207)
Cash EBITDA 573 (129)
Functional and presentation currency
Items included in the financial statements of each of the Group's entities are
measured using the currency of the primary economic environment in which the
entity operates ('the functional currency'). The consolidated financial
statements are presented in US Dollars which is the Group's functional and
presentation currency.
Transactions and balances
Transactions in foreign currencies are recorded at the prevailing rate of
exchange in the month of the transaction. Foreign exchange gains or losses
resulting from the settlement of such transactions and from the translation of
monetary assets and liabilities denominated in foreign currencies at the
year-end exchange rates are recognised in the income statement.
Group companies
The results and financial positions of all Group entities that use a
functional currency different from the presentation currency are translated
into the presentation currency as follows:
· assets and liabilities for each entity are translated at the closing
rate at the period end date.
· income and expenses for each Statement of Comprehensive Income item are
translated at the prevailing monthly exchange rate for the month in which the
income or expense arose, and all resulting exchange rate differences are
recognised in other comprehensive income with the foreign exchange translation
reserve.
Earnings per share
Earnings per share is calculated based upon the profit or loss on ordinary
activities after tax for each period divided by the weighted average number of
shares in issue during the period.
Weighted average number of shares for basic & diluted profit per share 30 Sep 2025 30 Sep 2024 31 Mar 2025
No. of shares No. of shares No. of shares
Basic 97,780,970 97,880,145 97,976,898
Diluted 97,780,970 100,577,564 97,976,898
Where the Group has recorded a loss, diluted earnings per share is equal to
basic earnings per share.
Intangible Assets
Goodwill Customer relationships Development costs Patents and trademarks Computer software Total
$000 $000 $000 $000 $000 $000
Cost
At 1 April 2024 22,476 1,424 20,135 842 271 45,148
Additions - - 902 2 - 904
At 30 September 2024 22,476 1,424 21,037 844 271 46,052
Additions 30 - 617 - 5 652
Exchange differences 4 - - - - 4
At 31 March 2025 22,510 1,424 21,654 844 276 46,708
Additions - - 564 1 - 565
At 30 September 2025 22,510 1,424 22,218 845 276 47,273
Amortisation and impairment
At 1 April 2024 12,620 284 16,229 658 242 30,033
Amortisation - 72 1,096 18 6 1,192
At 30 September 2024 12,620 356 17,325 676 248 31,225
Amortisation - 70 1,104 18 6 1,198
At 31 March 2025 12,620 426 18,429 694 254 32,423
Charge - 71 1,044 13 5 1,133
At 30 September 2025 12,620 497 19,473 707 259 33,556
Net book value
At 30 September 2024 9,856 1,068 3,712 168 23 14,827
At 31 March 2025 9,890 998 3,225 150 22 14,285
At 30 September 2025 9.890 927 2,745 138 17 13,717
Further Copies
Copies of the Interim Report for the six months ended 30 September 2025 will
be available, free of charge, for a period of one month from the registered
office of the Company at Castle House, Angel Street, Sheffield, S3 4LN or from
the Group's website: www.zoodigital.com (http://www.zoodigital.com) .
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