Zoo Digital Regulatory News (ZOO)

26 April 2012

ZOO DIGITAL GROUP PLC

("ZOO" or "the Company")

Trading Update

ZOO Digital Group plc, the provider of workflow management software and services for creative media production, today provides an update on trading for the year ended 31 March 2012 ahead of the announcement of its full year results.

The Board reports that trading for the second half of the financial year has progressed in line with expectations and expects to report turnover for the year to 31 March 2012 of US$11.2 million (FY2011: US$13.8 million), including increases in the second half of the year in the number of titles prepared using ZOO's Blu-ray and eBook platforms.

Measures taken by the Board, as announced at the interim stage, to reduce costs and to increase the proportion of sales derived from ZOO's more advanced toolkits has led to the Company recording improved adjusted EBITDA(1) and adjusted operating profitability(2) in the second half of the year (US$1.0 million and US$0.2 million respectively, as compared to losses of US$0.4 million and US$0.9 million respectively in the six months to 30 September 2011).

Consequently, the Board expects to report an adjusted EBITDA(1) for the full year of US$0.6 million (FY2011: US$2.5 million) and an operating loss(2) of US$0.8 million (FY2011: operating profit of US$1.5 million).

The Company had a gross cash balance of US$1.2 million at 31 March 2012.

Stuart Green, CEO of ZOO, commented: "We are pleased to report a stronger second half of the financial year. 2011 was a very difficult year for the home entertainment industry due to the significant changes that have taken place in consumer markets. The innovation and diversification within our business has helped ZOO to broaden its offering into complementary markets and we believe that the business is in a strong position to take advantage of growth in a number of areas."

(1) Adjusted EBITDA as adjusted for share based payments

(2) Operating loss as adjusted for share based payments

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.