Zoo Digital in Sheffield reveals virus impact on customers

Zoo Digital, which provides subtitles for Hollywood film studios, said the COVID-19 outbreak has hit its customers, with the production of new titles "significantly hampered" by restrictions on travel and group gatherings.

Tuesday, 24th March 2020, 1:26 pm
Updated Tuesday, 24th March 2020, 2:48 pm

However, the Sheffield-based group said its strategy of delivering services through cloud-based software provides natural resilience in these circumstances.

The firm said it has already taken steps for staff to work from home without any significant disruption to production and its network of freelancers is largely unaffected.

Given that the full impact of COVID-19 on customers remains unclear, the firm said it isn't prudent to provide guidance on the potential full-year outcome for 2021 and 2022 at the moment.

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Zoo Digital chief executive Dr Stuart Green.

It added that due to the robustness of its business model and the strength of its customer relationships, it is confident of being well positioned for growth and remains confident in the long-term success of the business.

The company said it has noted the FCA moratorium on the publication of preliminary results and will provide an update as to when it intends to publish its full year results to March 31 in due course.

In a trading update for the year to March 31, Zoo said group revenue for the year is expected to rise four per cent to around £26m.

Second half revenue is up at least 12 per cent on the first half. Localisation and digital packaging revenues are expected to grow by around 10 per cent to £23m.

Zoo said it has successfully executed its core strategy of partnering with major media companies to provide localisation and digital packaging.

The firm is investing in its capacity to deliver these services to take advantage of a growing market opportunity. As a result, the company expects to report EBITDA – a measure of profit - for the year of not less than £1.9m, up from £345,000 the previous year.

Zoo reported a renewed focus on the localisation of back catalogue titles from a broader range of clients as demand for content gathers pace.

"As we approach the start of the new financial year we are currently experiencing higher levels of interest in our cloud-based localisation services from media companies," said chief executive Stuart Green.