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28% revenue growth at Sheffield’s Zoo

Zoo Digital has reported a fourth successive year of growth, with revenue up 28% to $90.3m.

The figures cover the year ended 31st March, so don’t take into account the impact of the Writers Guild of America strike, or the cutbacks at major streamers. Last month, the Sheffield group, which provides subtitle and media services to the entertainment industry warned that this would be likely to have an affect on next year’s results.

“While the current disruption is frustrating, the Board remains confident that ZOO is fundamentally well positioned to continue our growth once the hiatus concludes,” said Stuart Green, CEO of ZOO Digital.

“Over the medium and long-term, we expect to emerge stronger and take further market share as customers reduce their pool of vendors to those few with global end-to-end capabilities.”     

For the year ended 31st March, its adjusted EBITDA grew to $15.5m (FY22: $7.1m), while operating profits quadrupled to $8.1 million (FY22: $1.9m),

Its Media localisation segment sales grew by 34% to $56.6m; subtitling increased by 15%; and dubbing by 73%; media services grew by 22% to $32.1 million; and its worldwide freelancer network grew by 4% to 11,467.

During the period it invested in new hubs in India, South Korea, Denmark and Spain.

 “ZOO delivered a fourth successive year of double-digit revenue growth and margin improvement in FY23 and we expanded our footprint in strategically important, high-growth regions. We generated strong cashflows and delivered record pre-tax profitability, demonstrating the benefits of the operational leverage in the business,” added Stuart Green, CEO of ZOO Digital,” continued Green.

“The market has evolved rapidly over recent years as global audiences transition from traditional linear programming to streaming platforms. In this context, we view our customers’ strategic reviews and the Hollywood strikes as evidence that the industry is now recognising the structural nature of changes in how modern audiences watch film and television. Localisation is one of the most cost-effective ways to bring new content to global audiences, while also providing access to new markets and millions of additional subscribers. This is why we are investing ahead of the curve to expand our footprint in key international territories, most notably APAC which is a high-priority region for all global streaming services. 

Looking forward, it raised £12.5m through an oversubscribed placing in April to fund the proposed acquisition of a partner company in Japan – discussions are ongoing.

The company stated that it would be “taking steps to adjust the cost base to reduce the impact of the temporary industry slow-down on ZOO’s business” but that it remained “confident” in its medium and long-term position and expected to deliver revenue growth in 2023.

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