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Highlights:

  • ZOO's FY25 revenue increased by 22% to $49.6 million (£38.7 million), with adjusted EBITDA returning to a $1.1 million (£0.86 million) profit.

  • The company achieved $8.4 million (£6.54 million) in annual fixed cost savings, with further savings expected in FY26.

  • Customer retention improved to 98.4%, with ZOO named a Preferred Fulfilment Vendor for Amazon Prime Video.

ZOO Digital Group plc (AIM:ZOO), a provider of localisation and digital media services to the global entertainment sector, has released its audited financial results for the year ended 31 March 2025, reporting revenue growth and a return to adjusted EBITDA profitability.

Financial Performance

Revenue for FY25 rose 22% to $49.6 million (£38.7 million) from $40.6 million (£31.6 million) in FY24. Adjusted EBITDA1 returned to a profit of $1.1 million (£0.86 million) compared to a loss of $13.6 million (£10.6 million) in the prior year. The company reported an operating loss of $6.5 million (£5.07 million), narrowing from a loss of $19.1 million (£14.87 million) in FY24.
Loss before tax also improved, reducing to $8.3 million (£6.47 million) from $20.5 million (£15.95 million) in FY24. Gross cash at year-end stood at $2.7 million (£2.10 million), down from $5.3 million (£4.12 million) a year earlier. The company maintained no drawdown on its invoice financing facilities and continued to prioritise cash management.

Operational Developments

The group achieved $8.4 million (£6.54 million) in annual fixed cost cash savings during the year, which included $1.6 million (£1.25 million) of capitalised R&D costs. Additional measures implemented in FY26 are expected to deliver a further $2.5 million (£1.95 million) in annual fixed cost savings.
Customer retention improved significantly, with retained sales2 at 98.4% compared to 92.3% in FY24. ZOO improved its relationships with non-traditional studios to diversify its client base and was named a Preferred Fulfilment Vendor for Amazon Prime Video.

Current Trading and Outlook

The company noted that reduced demand for dubbing impacted FY26 Q1 revenue, which was 18% lower than the same quarter in FY25. However, service lines excluding dubbing recorded three consecutive quarters of revenue growth leading into FY26 Q1.

Ongoing cost reductions contributed to an EBITDA profit for FY26 Q1, achieved after restructuring costs and in line with management expectations. Management highlighted that operational efficiencies delivered in FY25, combined with ongoing measures in FY26, the implementation of AI, and automation initiatives, have created a leaner operating model designed to improve margins as revenues recover.