Subtitling and dubbing services provider Zoo Digital says 2025 revenues and earnings are likely to fall miss market expectations, despite a rise on last year.
The Sheffield-based provider of 'localisation' services to Hollywood studios and streaming platforms says full-year performance will fall short of expected $55m revenue and £2.75m Ebitda. In a trading update, Zoo said it hopes to return to Ebitda profit of at least $1m compared with last year's $13m loss.
It follows a turbulent time for the global operator which was severely impacted by the US screenwriter and actor strikes in 2023. The action stalled new productions and interrupted what had been a growth trajectory for the firm.
In its wake, Zoo - which uses digital technology and a pool of more than 12,000+ freelancers to carry out its work - has been making cost savings. Bosses said those efforts have results in a 20% fall in fixed costs during the year, with expectations that blended gross margins will improve to 36%.
Zoo said it had been closely managing its cash position as part of a move towards cash breakeven - and now expects a balance at the end of the 2025 financial year of more than $1m, with invoice discounting facilities of $3m and £2m that are not expected to be used.
The firm's trading update said: "Whilst the company's order book has improved in recent months through the addition of several high value projects, these are not included in the company's current expectations for FY25. The timing of revenue recognition for these projects is uncertain as commencement for much of this work is dependent on the supply of original assets from licensors. In addition, some projects in the FY25 pipeline relate to titles that customers have either delayed or cancelled.
"The company has secured several new customer engagements which are expected to begin to deliver meaningful incremental revenues in FY26. This includes being named a preferred fulfilment vendor (PFV) for Amazon Prime Video, positioning Zoo among a select group of vendors that production companies may use to digitally package and distribute content on Amazon Prime Video."
