ZOO Digital Group plc expects to return to EBITDA profit on the back of a jump in turnover.
The Sheffield-headquartered localisation and digital media services partner to the global entertainment industry – which is listed on the London Stock Exchange’s junior AIM market – expects revenues for the year ending 31st March 2025 to be at least $50.5m, which is up 24% on the prior year.
It said this will result in a return to EBITDA profit of at least $1m, compared to a loss of $13.6m last year.
However FY25 revenues and EBITDA are expected to be below market expectations.
The company has implemented targeted cost-saving measures, reducing its fixed costs by 20% during the year and also expects blended gross margins to improve to 36%.
ZOO expects its cash balance at the end of FY25 to exceed c.$1m, and has invoice discounting facilities of $3m and £2m, which are expected to be largely unutilised.
“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,” it stated.
“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.”
ZOO added that it 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 for Amazon Prime Video, positioning ZOO among a select group of vendors that production companies may use to digitally package and distribute content on that platform.
ZOO expects that dubbing revenues for FY26 will be lower than in FY25. However, with a lower cost base and higher margin revenue mix the overall profitability of the business is expected to improve significantly year on year.