Zoo Digital reveals virus hit on customers

However, the Sheffield-based group said its strategy of delivering services through proprietary cloud-based software provides natural resilience in these circumstances.

The firm said it has already taken steps for staff to work from home without any significant disruption to production and its network of freelancers is largely unaffected.

Given that the full impact of COVID-19 on Zoo's customers remains unclear, the firm said it isn't prudent to provide guidance on the potential full year outcome for 2021 and 2022 at the moment.

It added that due to the robustness of its business model and the strength of its customer relationships, it is confident of being well positioned for growth and remains confident in the long-term success of the business.

The company said it has noted the FCA moratorium on the publication of preliminary results and will provide an update as to when it intends to publish its full year results to March 31 in due course. In the meantime, it said it will update shareholders as and when appropriate.

In a trading update for the year to March 31, Zoo said group revenue for the year is expected to rise 4 per cent to around £26m.

Second half revenue is up at least 12 per cent on the first half. Localisation and digital packaging revenues are expected to grow by around 10per cent to £23m.

Zoo said it has successfully executed its core strategy of partnering with major media companies to provide localisation and digital packaging.

This resulted in the company’s first appointment to deliver end-to-end services, two further engagements as a preferred vendor and the successful deployment of ZOOstudio for managing OTT localisation and digital packaging operations. An OTT (over-the-top) media service is a streaming media service offered directly to viewers via the Internet.

Zoo said these recent successes demonstrate that its software, coupled with its industry knowledge and skills, is gaining traction in the market for Over The Top (OTT) localisation and digital packaging.

The firm is investing in its capacity to deliver these services to take advantage of a growing market opportunity. As a result, the company expects to report EBITDA for the year of not less than £1.9m, up from £345,000 the previous year.

Zoo reported a renewed focus on the localisation of back catalogue titles from a broader range of clients as demand for content for the OTT platforms gathers pace.

This follows a period during when it experienced some softening of sales due to a temporary hiatus of orders as customers have implemented business continuity plans.

"As we approach the start of the new financial year we are currently experiencing higher levels of interest in our cloud-based localisation services from major media companies," said Zoo's chief executive Stuart Green.