ZOO Digital Group plc (LON: ZOO), a world-leading provider of cloud-based localisation and digital media services to the global entertainment industry, today announces its unaudited financial results for the six months ended 30 September 2020 ("H1 FY21").
· Revenues increased by 15% to $16.4 million (H1 FY20: $14.2 million) driven by strong growth in the period for dubbing and digital packaging
· Gross profit reduced to $5.1 million (H1 FY20: $5.8 million) explained by an increase in direct staff required to deliver growth in H2
· Adjusted EBITDA1 of $1.3 million (H1 FY20: $1.8 million), reflecting the reduced gross profit
· Operating loss of $0.1 million (H1 FY20: profit of $0.4 million)
· Cash balance of $2.1 million at period end (H1 FY20: $0.6 million)
· Subtitling services delivered to all major Hollywood studios
· Significant new client accounts added with total number invoiced in H1 increasing 30% to 122 (H1 FY20: 94)
· Cloud dubbing revenue grew by 480% year-on-year
· Scope of ZOOstudio platform extended, leading to broader and deeper deployment in a major OTT provider
· Digital packaging grew 33% with significant further growth expected in Q3
· Client retention rate increased to 98% (89% in H1 FY20)
· ZOO's technology is becoming increasingly embedded into the operations of major studios and streaming services
· Our market-leading end-to-end solution continues to be a major beneficiary of the shift in industry prioritisation
· Scope of services delivered to major clients is expanding
· COVID-19 has accelerated an enduring industry shift to software-enabled services
· Trading in the first few weeks of the third quarter has been strong, with revenue growth expected to be over 20% half-on-half
· Confident in achieving increased market consensus for the full year
1 adjusted for share-based payments.
Stuart Green, CEO of ZOO Digital, commented: "The first half of the year may well prove to be the most significant period in the Group's history. The COVID-19 pandemic hastened the pace of adoption of our technology-based, media service offering and introduced us to new customers who have trialled and engaged ZOO's proposition and been impressed with the results. While original title production across the industry has been placed on hold, we have seen customers shift to back catalogue materials and the associated high levels of demand for digital packaging services, highlighting the benefits of our end-to-end vendor model.
"There remain significant volumes of back catalogue work, giving us confidence in our full year performance and we are very well placed to benefit greatly when content creation resumes. As a result, we have invested through this half year in order to take full advantage once conditions normalise. With a strong pipeline and continued momentum, the Board remains confident in its ability to achieve the increased market consensus for the full year."