ZOO Digital is one of the companies whose business models have stood it in good stead during the COVID-19 pandemic; its cloud-based platform has proved to be a key attribute over the last six months. Indeed, the changed working practices within the dubbing industry have helped to educate more potential users about the benefits of remote operating and the quality of performance that can be achieved when using the ZOOdubs platform. In our view, ZOO’s Capital Markets Day (CMD) presentations - a recording is available here - achieved a rare combination of being both informative and clear as to those operational benefits and the financial implications (a roadmap to U$100m of revenue) for the Group within an evolving market. We highlight some of the main messages from the speakers – from outside the company in several cases – which covered the market for localisation services, the use and benefits of ZOO’s platform and the technology behind the service.
ZOO Digital provides services to showcase, localise, and distribute TV and movie content globally via its proprietary cloud-based ecosystem which supports its subtitling, dubbing and digital packaging offerings in a secure manner while providing cost & time efficiencies to its clients.
We believe that its end-to-end offering differentiates ZOO from its competitors leaving it well placed for continued strong organic growth. It also represents a considerable barrier to entry for competitors.
The current operating environment means that ZOO has seen growth opportunities while some competitors are struggling. There was an uplift in dubbing in the early months of lockdown when traditional providers (who often own and operate dubbing studios across multiple geographies) could not operate, allowing ZOO to step up its proposition to new customers.
With a lack of new content, there has been a switch in focus to back catalogue which is reflected in the mix of business, which includes more digital packaging. Clearly, the lack of new productions is an industry wide problem resulting in industry-wide pressure on subtitling and dubbing sales, but ZOO appears to have outperformed the broader market.
There is no timetable for the ambition to reach U$100m of revenue but we note that the Group is well-placed to take advantage of a return to new production with the added advantage of a greater number of content providers now aware of the benefits of ZOOdubs.