Zoo Digital Regulatory News (ZOO)

26 January 2022

ZOO DIGITAL GROUP PLC

("ZOO", the "Group" or the "Company")

Trading Update

Continuing revenue growth

ZOO Digital Group plc, a world-leading provider of cloud-based localisation and media services to the global entertainment industry, today provides an update on current trading and outlook for the financial year ending March 2022.

The strong revenue growth reported in ZOO's interim results has continued into the second half as the Group cements its position as a leading provider of end-to-end services for the streaming video industry. With the resumption of new productions, which had been on hold due to the pandemic, together with ongoing migration of catalogue titles to streaming platforms and regional territory launches, ZOO has secured a strong and growing pipeline of orders across all service lines. As a result, revenues for the full year are now expected to be at least $57 million (FY21: $39.5 million, +44%), with growth in the second half over the first half of at least 11%, and at least 29% ahead of H2 2021. The expected revenue growth has been driven by both new territory launches and the return of new productions, and as a result, localisation revenues are expected to grow by at least 55% and media services by at least 30%.

Based on this strong performance, revenues for the year are anticipated to be ahead of market expectations, yielding additional profits that are being reinvested in staff, infrastructure, facilities and international operations to extend ZOO's capacity and support growth.

As major media companies aim to offer greater volumes of exclusive content for their streaming video service subscribers, global content spend has reached record levels. Specialist media analytics firm Ampere Analysis reported that spend grew to $220 billion in 2021 and forecasts further growth in 2022. This is creating significant volumes of original programming that must be prepared and localised for distribution in many countries and languages, resulting in a growing market for ZOO's services.

WarnerMedia, NBCUniversal and ViacomCBS have launched streaming video platforms in North America and have all announced plans to make these services available internationally in 2022 requiring catalogue content as well as newly produced originals. This, together with the ongoing roll-out of established global services, will create unprecedented demand for premium localisation and media services during 2022.

ZOO has been appointed as a primary vendor for the forthcoming European launch of a global streaming video service and expects that this will lead to significant orders commencing in Q4 and delivering meaningful revenues in FY23.

The Company expects to announce further investments to expand its international footprint which, together with its ongoing investment in technology, will provide ZOO with greater capacity and opportunity for continued growth.

Stuart Green, Chief Executive Officer, said:

"We continue to see strong revenue growth as we extend our order pipeline across all service lines. As major media companies expand their streaming platforms internationally the global spend on film and TV programming continues to rise. This content must be localised for regional audiences. With these favourable dynamics at play, ZOO's technology-enabled end-to-end service offering positions it well to continue to grow and take a greater share of an expanding market."

Enquiries:

About ZOO Digital Group plc:

ZOO Digital supports major Hollywood studios and streaming services to globalise their content and reach audiences everywhere, by providing world-leading, technology-enabled localisation and media services.

Founded in 2001, ZOO Digital operates from hubs in Los Angeles, London and Dubai, with a development and production centre in Sheffield, UK. The company is targeting $100m sales in the medium term.

The Group provides media services through its platforms that include: ZOOsubs, ZOOdubs, ZOOstudio. Its full-service proposition delivers the end-to-end services required to prepare both original and catalogue content for digital distribution; these services include dubbing, subtitling & captioning, metadata creation & localisation, artwork localisation and media processing. Alongside this offering, ZOO also provides its customers with management platforms and strategic solutions to support their own internal globalisation operations.

ZOO is a go-to service partner for media businesses looking to globalise their content across different territories, languages and distribution platforms. Using its innovative technology-enabled approach, ZOO helps its customers to reduce time to market, lower costs and deliver high quality products to their global audiences. The business has frameworks in place with all major Hollywood studios and streaming services. Its customers include Disney, NBCUniversal, HBO and ViacomCBS.

ZOO's competitive advantage arises from three interlinking factors - the leading role it has played in the digital transformation of its sector; the world class proprietary platforms that it develops to enable this transformation; and the global supply chain of thousands of freelancers, working collaboratively in ZOO's platforms, which delivers services that scale easily to meet demand. These factors combine to make ZOO uniquely geared to capitalise on new market opportunities in a fast-paced and constantly evolving industry.