Soft­ware firm Zoo Dig­i­tal in pledge to cre­ate more jobs

Sh­effield group posts loss de­spite huge surge in rev­enue

Yorkshire Post - Business - - FRONT PAGE - MARK CASCI BUSI­NESS ED­I­TOR Email: Twit­ter: @MarkCasci

SOFT­WARE BUSI­NESS Zoo Dig­i­tal said it ex­pects to in­crease its head­count in the com­ing months de­spite post­ing a $173,000 loss.

The Sh­effield-based busi­ness grew its rev­enues by 63 per cent but said the cost of its newly launched dub­bing sys­tems had pulled the firm’s num­bers into the red for the six months end­ing Septem­ber 30.

This com­pared with a $421,000 profit dur­ing the same pe­riod last year. Shares fell slightly as a re­sult.

De­spite the loss the man­age­ment team sig­nalled an up­beat note, say­ing its new dub­bing plat­form, ZOO­dubs, had helped drive rev­enue to $12.7m as more and more cus­tomers sought out its cloud-based ser­vices.

In to­tal, the EMEA mar­ket is worth $2bn per year, of which dub­bing con­sti­tutes $1.4bn.

The ZOO­dubs plat­form al­lows voice ac­tors to record trans­la­tions for movies or boxsets from any suit­able record­ing space and takes away the need for costly record­ing ses­sions.

Other op­er­a­tional high­lights for the start of the year in­cluded the launch of a new cloud-pow­ered script­ing ser­vice and the ad­di­tion of three new af­fil­i­ates in emerg­ing mar­kets.

It also saw its largest client con­cen­tra­tion fur­ther re­duced in size to 28 per cent of sales, as com­pared with 47 per cent in the first half of 2016.

Dur­ing the pe­riod it also gen­er­ated £2.6m in cash and cap­i­talised a fur­ther £1.1m of debt, with net debt over­all down to $3.9m, as com­pared with $6.2m last year.

Stu­art Green, chief ex­ec­u­tive, told The York­shire Post: “Our cloud-based in­fra­struc­ture brings much more ben­e­fit to clients than our com­peti­tors.

“They can place an or­der [for sub­ti­tling or dub­bing] di­rectly with us and use a sys­tem with full vis­i­bil­ity of the projects at any time.

“Go­ing for­ward we see a re­ally pos­i­tive op­por­tu­nity for dub­bing with our ap­proach which is a lit­tle bit dif­fer­ent.

“The board re­mains con­fi­dent of meet­ing its full year man­age­ment ex­pec­ta­tions for ad­justed earn­ings be­fore in­ter­est, tax, de­pre­ci­a­tion and amor­ti­sa­tion and is ex­cited for the group’s fu­ture.”

Mr Green said he agreed that his busi­ness was a dis­rupter in the fields of sub­ti­tles and dub­bing and that Zoo Dig­i­tal was grad­u­ally al­low­ing voice ac­tors the chance to record their per­for­mances at a place of their choos­ing, in­volv­ing mod­est in­vest­ments in sound -proof­ing and mi­cro­phone tech­nolo­gies.

“Hav­ing our func­tions in the cloud means we can dis­pense with the tech func­tions such as hav­ing mix­ing desks and en­gi­neers or even hav­ing to work in phys­i­cal ded­i­cated stu­dios.

“We can do our record­ing any­where in the world that is a space which is sound-treated and has mi­cro­phones.

“We have been work­ing on this for over 10 years.

“This has been a suc­cess­ful and sig­nif­i­cant in­vest­ment in tech.”

He added: “In Sh­effield we now em­ploy 80 staff and we are ex­pand­ing with us mov­ing into dub­bing.

“This will re­sult in op­por­tu­ni­ties to gen­er­ate em­ploy­ment. We have two ex­cel­lent uni­ver­si­ties pro­duc­ing ex­cel­lent grad­u­ates.”

An­a­lysts at Finn Cap hailed Zoo Dig­i­tal’s “demon­stra­ble progress” and up­dated its medium-term growth es­ti­mate for the firm from 14 per cent to 20 per cent.

“Rev­enue of $12.7m is in line with Septem­ber’s up­date and con­firms a strong H1, with sales growth of 63 per cent.

“We lift FY18E sales from $21m to $26m (im­ply­ing 58 per cent year-on-year growth), while re­it­er­at­ing es­sen­tially un­changed profit ex­pec­ta­tions, re­flect­ing greater in­vest­ment than an­tic­i­pated.

“We also in­tro­duce maiden FY19 fore­casts and up­grade our price tar­get to 97p.”

In­cluded in Zoo Dig­i­tal’s client base are a ver­i­ta­ble who’s who of the top pro­duc­tion com­pa­nies in the world, with Dis­ney, HBO, Sony, the BBC, Net­flix, Ap­ple, Para­mount, Univer­sal, Warner Brothers and 20th Cen­tury Fox among those avail­ing them­selves of the Sh­effield-based firm’s ser­vices.

Go­ing for­ward we see a re­ally pos­i­tive op­por­tu­nity for dub­bing.

Stu­art Green, chief ex­ec­u­tive, Zoo Dig­i­tal

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