New growth for DVD software firm

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Entertainments industry software specialist ZOO Digital is expecting to announce pre-tax profits of around $1.3 million (£798,000) when it publishes its preliminary results in June.

The Sheffield-based company, which includes Holywood studios and a major US TV company among the clients for its DVD and iTunes video software production tools, says profits are expected to be in line with market expectations.

Chief executive, Dr Stuart Green, said: “I am pleased with the group’s bottom line performance despite revenue falling slightly short of expectations.

“The short term slowdown in revenues from a major customer is now reversing and I am encouraged to see activity levels in line with our previous expectations. We are currently working with a number of new customers and (see) prospects to apply our proprietary software to a broader range of authored content, addressing substantial additional markets.

“We believe this will lead to further diversification of our client base and therefore we continue to view the future with great confidence.”

ZOO says margins have benefited from clients being charged for some non-core, outsourced services by a third party rather than through ZOO.

That, combined with a short-term slowdown of orders while a major customer restructured, led to revenues falling, but demand from the customer was increasing again and ZOO expects revenues to increase in the future.