TIDMZOO
RNS Number : 3910J
Zoo Digital Group PLC
23 August 2021
23 August 2021
ZOO DIGITAL GROUP PLC
("ZOO" the "Group" or the "Company")
Trading Update: Continuing Strong Growth
Loan Note Conversion
ZOO Digital Group plc (AIM: ZOO), the leading provider of
end-to-end cloud-based localisation and media services to the
global entertainment industry, today provides an update on current
trading and outlook for the half year ending 30 September 2021.
Revenues for the half year are expected to be at least $25
million (FY21H1: $16.5 million), which equates to growth over the
first half of FY21 of at least 51% and at least 8% over the second
half of FY21 (FY21H2: $23.1 million).
Growth during the first half of the year has been due
predominantly to the Company's provision of services to support the
migration of catalogue titles to streaming platforms and the
associated new territory launches.
In recent weeks some customers have placed orders relating to
new titles following the cautious resumption of productions within
the industry. The Board anticipates that the associated pipeline of
work will build gradually over the coming months.
The Board has moved forward with plans to establish regional
hubs and is close to concluding strategic investments that will
provide a presence in India, with multiple discussions progressing
in other important international locations.
The Company has been in discussions with the holders of its
Unsecured Convertible Redeemable Loan Stock instruments concerning
early conversion into new ordinary shares of GBP0.01 each in the
capital of ZOO ("Ordinary Shares") at a conversion price of 48
pence per Ordinary Share, ahead of the instrument's redemption date
of 31 October 2021. The total principal value of the loan stock is
GBP2.56 million (approximately $3.5 million at a rate of $1.36).
Based on these discussions it is the Board's expectation that a
majority of the total value of the loan stock will be converted
into Ordinary Shares prior to 30 September 2021.
Assuming the full value of the loan stock is converted, the
effect will be that the Company's issued share capital will
increase by 5.3 million new Ordinary Shares and that current
liabilities shown in the consolidated statement of financial
position as at 30 September 2021 will reduce by approximately $3.5
million due to the conversion of the loan and a further $4.5
million due to the elimination of the current liability shown as a
separable embedded derivative linked to the loan. From 1 November
2021 the savings in finance costs relating to interest on the loan
will equate to approximately $263,000 on an annualised basis.
Based on the strong performance in the first half of the year
and the pipeline of orders that extends only into the first months
of the second half, the Board is confident of exceeding current
full year revenue expectations. The additional gross profit
generated will be utilised to continue to invest for future growth
and take advantage of the many opportunities present in our
marketplace to build our business further.
Stuart Green , CEO of ZOO Digital, commented,
"ZOO has started the new financial year very positively,
delivering significant growth over the first half and building on
last year's momentum. New title production is beginning to resume
and we expect this work to gradually return to previous levels.
This, combined with the continually increasing demand for our
services that support the migration of back catalogue content for
streaming, gives us confidence in achieving our long-term financial
goals."
The information contained within this announcement is deemed to
constitute inside information as stipulated under the Market Abuse
Regulations (EU) No. 596/2014. Upon the publication of this
announcement, this inside information is now considered to be in
the public domain.
The person responsible for making this announcement on behalf of
the Company is Phillip Blundell, Chief Financial Officer.
For further enquiries please contact:
ZOO Digital Group plc +44 114 241 3700
Stuart Green - Chief Executive Officer
Phillip Blundell - Chief Finance Officer
Stifel Nicolaus Europe Limited
F red Walsh / Tom Marsh +44 207 710 7600
Instinctif Partners +44 207 457 2020
Matthew Smallwood / Hannah Campbell zoo@instinctif.com
About ZOO Digital Group plc:
ZOO Digital supports major Hollywood studios and streaming
services to globalise their content and reach audiences everywhere,
by providing world-leading, technology-enabled localisation and
media services.
Founded in 2001, ZOO Digital operates from hubs in Los Angeles,
London and Dubai, with a development and production centre in
Sheffield, UK. The company is targeting $100m sales in the medium
term.
The Group provides media services through its platforms that
include: ZOOsubs, ZOOdubs, ZOOstudio. Its full-service proposition
delivers the end-to-end services required to prepare both original
and catalogue content for digital distribution; these services
include dubbing, subtitling & captioning, metadata creation
& localisation, artwork localisation and media processing.
Alongside this offering, ZOO also provides its customers with
management platforms and strategic solutions to support their own
internal globalisation operations.
ZOO is a go-to service partner for media businesses looking to
globalise their content across different territories, languages and
distribution platforms. Using its innovative technology-enabled
approach, ZOO helps its customers to reduce time to market, lower
costs and deliver high quality products to their global audiences.
The business has frameworks in place with all major Hollywood
studios and streaming services. Its customers include Disney,
NBCUniversal, HBO and ViacomCBS.
ZOO's competitive advantage arises from three interlinking
factors - the leading role it has played in the digital
transformation of its sector; the world class proprietary platforms
that it develops to enable this transformation; and the global
supply chain of thousands of freelancers, working collaboratively
in ZOO's platforms, which delivers services that scale easily to
meet demand. These factors combine to make ZOO uniquely geared to
capitalise on new market opportunities in a fast-paced and
constantly evolving industry.
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