The Hollywood writers’ and actors’ strikes have hit profits and revenue at Sheffield’s Zoo Digital.
This morning the group confirmed that its income fell 58% to $21.4m, while gross profits dropped 87% to $2.1m (H1 FY23: $16.5m) in the 6 months to 30th September.
Overall its losses (before interest, taxes, depreciation, and amortisation) were $7.1m, compared to a profit of $7.3m in the first half of the financial year.
Zoo is a global provider of cloud-based localisation and digital media services for the entertainment industry – providing audio description, dubbing, subtitling and other facilities.
“The year to date has been overshadowed by the first joint strike of Hollywood actors and writers in more than 60 years. This temporary disruption has had a significant impact across our sector and the wider media and entertainment industry, resulting in artificially low production volumes in the short-term,” explained Stuart Green, CEO of ZOO Digital.
“While this has had a significant impact on our financial performance, we have taken targeted measures to conserve cash while positioning the business to recover rapidly once orders return to more usual levels.”
Green remained confident that the future outlook was brighter:
“As the streaming industry focuses increasingly on profitability, we are already seeing evidence that major buyers are relying on fewer vendors and prioritising those with end-to-end capacity and scale. This puts ZOO in a strong position to process higher volumes of work from customers over time, particularly as we make strategic investments in customers’ high-priority growth regions.
“With the resolution of the strikes, we look to the future with optimism and anticipate a phased return of orders in the second half, accelerating into FY25. We remain confident in the industry’s long-term structural growth drivers and our role as a trusted partner to many of the world’s largest entertainment companies.”
It said that there was a stronger order book for the second half of the financial year and it expected to “at least” break even in Q4, returning to profitability in 2025.
