Software firm Zoo Digital in pledge to create more jobs
Sheffield group posts loss despite huge surge in revenue
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