Zoo Digital Regulatory News (ZOO)

30 April 2013

ZOO DIGITAL GROUP PLC

("ZOO" or "the Company")

Trading Update

ZOO, the provider of workflow management software and services for creative media production, today provides an update on trading during its financial year to 31 March 2013.

The Company expects to report revenues in the range of $10.3m to $10.4m, with adjusted EBITDA* of approximately $0.7m and adjusted loss before tax* of approximately $1.2m. At the year end the Company had a cash balance of $1.0m with its only indebtedness being a convertible loan note of $2.7m (being £1.77m).

The Company implemented certain cost cutting measures during the course of the year to align its cost base with its current operations and revenue pipeline. Those measures, including necessary headcount reductions, have been completed and the Board is confident that the cost base is better matched to the Company's expectations for the new financial year.

Looking forward, ZOO is pleased that its product set and its target market expanded in the course of the year. ZOO has deployed ZOOcore systems for a number of clients in diverse business areas, including the recently announced licence with Hachette Book Group. Early client feedback on ZOOsubs, the Company's Cloud-based subtitle production system has been very positive, to the extent that this offering is being broadened in order to meet customers' specific demands. Finally, ZOO's eBook builder has now been adopted by a number of publishers, both large and small, and should the transition take place as predicted towards publishing high quality, fixed layout titles, the Company is well placed to benefit.

Further reports of progress will be provided in ZOO's final results announcement.

Dr Stuart Green, CEO, commented "The continued turbulence experienced in the home entertainment market had an impact on ZOO's traditional business. Whilst this was frustrating we believe that we have reacted quickly to align our cost base to reflect these conditions and that the further diversification of our product set should, in time, lessen the impact on any single revenue stream. Also, the scalability of ZOO's new Cloud-based services means we are well placed to benefit from any growth in our markets. We remain cautiously optimistic as we enter the new financial year."

* As adjusted for share-based payments and foreign exchange rate differences.

Ends

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About ZOO Digital Group plc:

ZOO Digital Group plc provides software and related services that support the authoring, re-purposing and distribution of creative media. ZOO's products form an integrated suite of cloud-based and desktop applications for audio/visual content and printed materials, adapting these media for different languages, formats and delivery mechanisms.

By centralising editorial and approval processes via secure cloud-based platforms, ZOO's proprietary patented software helps customers to increase their speed of production, reduce costs and protect their brand integrity. ZOO's services enable quicker and more cost effective processes across a wide range of applications and formats, including packaging, printed materials, DVD, Blu-ray Disc, video on demand, electronic sell-through, broadcast, music and electronic books.

The Group's largest customers include major Hollywood studios, for which the production, marketing and distribution of titles in numerous formats across many geographies and languages has previously been a lengthy, costly and largely manual process. Increasingly the Group's software is benefiting a variety of companies across sectors where the development of media products, printing, packaging and marketing involves complex processes in multiple countries and languages, particularly where brand integrity is of core importance.