PROGRESSIVE: Zoo Digital: Recovery underway and a significant contract

Today’s trading statement from ZOO highlights a ramp-up in demand following the end to the industry-wide strikes of last year. ZOO struck a note of caution in its January update regarding the timing of orders. However new productions are starting to translate into a healthy order pipeline, with a good recovery in revenue anticipated in H1 FY25. The update guides to revenue of at least $40m for the year to March 2024, ahead of our estimate at $36.8m. We have improved our adjusted EBITDA loss marg

An encouraging trading update

ZOO Digital has provided an encouraging FY24 trading update which demonstrates a quarter-on-quarter improvement in trading and would appear to suggest that H2’24 is the nadir. January 2024 was the highest invoicing month since April 2023 and ZOO expects to beat revised FY24 market guidance with revenues c.$2.0m ahead of SCMe and Net Cash at least c.$1.5m higher. Following engagement with its customers, ZOO has secured improved visibility of work (with some extending until September 2024) with th

PROGRESSIVE: Zoo Digital: Update flags delays in production completions

This morning’s trading statement from ZOO confirms that production companies are taking longer than expected to complete projects. This follows the resumption of new production after the industry-wide strikes ended in November 2023. The anticipated January ramp-up has yet to fully materialise, with entertainment projects expected to complete in January now moving into February and beyond. However, ZOO has been notified by its largest customer of a pipeline of orders that provides good visibility

FY24 Trading Update

ZOO Digital has provided an FY24 trading update with previously anticipated Q4’24 projects now expected in Q1’25. FY24 results are expected to be significantly below expectations and ZOO will no longer be breakeven in Q4. While a return to profitability is expected in FY25, we downgrade FY24 Net Cash to $1.5m (from $6.6m) but highlight ZOO has c.$5.25m in unused debt facility available. The first double strike in 60+ years ended in September and November 2023, and ZOO has been notified of orders

Hybridan Small Cap Feast 30 Nov 23

30th November 2023 @HybridanLLP Status of this Note and Disclaimer This document has been issued to you by Hybridan LLP for information purposes only and should not be construed in any circumstances as an offer to sell or solicitation of any offer to buy any security or other financial instrument, nor shall it, or the fact of its distribution, form the basis of, or be relied upon in connection with, any contract relating to such action. This document has no regard for the specific investment obj

PROGRESSIVE: Zoo Digital: H1 24 – positive news, short and long term

ZOO has announced H1 24 results in line with guidance at the recent AGM. We welcome the news earlier this month that the US actors’ strike has ended. This suggests that revenues could return to historical levels in the relatively near term, and that ZOO was correct to maintain capacity and capability to deliver during the recent hiatus. Subdued workflows have led to a significant EBITDA loss in H1 on revenue of $21m; but given the sequential month-on-month improvement expected, we maintain reven

H1’24: Waiting for a return to normality

ZOO’s H1’24 reflects the impact of the first double strike (writers and actors) in 60+ years, however, the resolution of the writers’ and actors’ strikes in September and November 2023 points to the darkest hour being behind ZOO. Revenues declined 58% yoy while ZOO reported a $7.1m adj LBITDA (H1’23: EBITDA of $7.3m) as the Group entered the year with a cost base to support a c.$100m+ revenue business. Post-period end, ZOO has completed a cost cutting exercise that has removed 20% of UK/US headc

Hybridan Small Cap Feast - 02 Nov 2023

2nd November 2023 @HybridanLLP Status of this Note and Disclaimer This document has been issued to you by Hybridan LLP for information purposes only and should not be construed in any circumstances as an offer to sell or solicitation of any offer to buy any security or other financial instrument, nor shall it, or the fact of its distribution, form the basis of, or be relied upon in connection with, any contract relating to such action. This document has no regard for the specific investment obje

Kitchen-sinking forecasts…and cash is still ok

ZOO today provides an update on H1 trading and as well, the full-year outlook the result being material changes to FY24 forecasts, while we withdraw FY25 estimates. The driving force behind these changes is a combination of factors; more cautionary customer spend (as SVOD platforms are placing greater emphasis on balancing growth and profit) while more recently, protracted industrial action has introduced yet further disruption. As such, H1 revenue is set to be materially down at c.$21m vs. $51m

PROGRESSIVE: Zoo Digital: AGM flags continued workflow disruption

This morning’s AGM statement by ZOO confirms that trading is still being impacted by the two market issues detailed at the recent prelims. First, the industry-wide strikes that have halted new productions have not been fully resolved. A deal has been reached with the writers (WGA) but talks are still ongoing with the actors’ union, given the complexities surrounding AI. Second, workflow is still disrupted as the major streaming providers realign business models to increase profitability. However

Hybridan Small Cap Feast 10/08/2023

Dish of the day Joiners: No joiners today. Leavers: National Milk Records plc (AQSE: NMRP) has left the AQSE Growth Market. What’s cooking in the IPO kitchen?** Announced ITF 4 August: Tan Delta Systems plc, a Sheffield based Company intends to IPO on AIM. Tan Delta has developed an innovative and differentiated monitoring solution based on real time oil analysis and analytics that offers equipment operators enhanced insight into the maintenance status of their equipment and thus the ability to

PROGRESSIVE: Zoo Digital: FY23 – strong revenue growth and margins

ZOO has announced FY23 results in line with the guidance given in the recent trading update. Increased market share and the scaling up of its international operations have delivered revenue growth of 28% to $90.3m (FY22: $70.4m), with good margin progress and profitability. ZOO’s key growth drivers remain intact, content budgets remain large and the focus by the key streaming players on monetisation models represents a material opportunity, underpinned by the roll-out of ZOO’s strategic geograph

A standout FY23, but valuation at an all-time low

FY23 was a standout year by any metric as ZOO Digital reported 28% revenue growth (+25% organic) and a 7.1 percentage point increase in adj EBITDA margins to a record 17.1%. Group revenues of $90.3m are consistent with the Group’s July trading update ($4.7m below our previous $95m forecast) but adj EBITDA is $1m higher at $15.5m. FY23 revenues could have been even higher if not for a slowdown in Q4 which has continued into H1’24. This slowdown has been well documented, as a number of major media

Well positioned for future success

Strong performance against tough market conditions

LIBERUM: The Liberum Leisure Digest: NLW increase - pricing power is key

Initial Equity Trading Comments - 19 February 2024

Pinewood Technologies (PINE LN) - Driving growth in automotive software

Pinewood’s transition to a pure-play automotive SaaS business is now largely complete. Today we introduce summary forecasts out to FY26 and reiterate the investment case. We see significant opportunity for Pinewood to grow its user base in the UK and internationally whilst generating high EBITDA margins and cash conversion. With a 24.5p special dividend embedded in the current price (payable Q1/Q2), the effective price today is 12.3p. Based on the Group’s FY27 target of £27m EBITDA, we estimate

Domino's Pizza - Growing the base

Domino’s Pizza Group’s (DOM’s) new CEO has set an ambitious long-term growth target, including an acceleration in its net store opening programme. With better alignment between the company and its franchisees, management believes DOM should be capable of generating improved profit growth, versus that achieved in recent years, and potential higher returns.

Marks & Spencer+ (MKS, House Stock at 255p) - 7Y FS HSBC UK tie-up– another brick in the wall

Zeus Top Picks for 2024 - 2023 review and outlook for 2024

On 9 January last year, we set out our ten top stock picks for 2023, for what turned out to be another relatively poor twelve months for UK equities due to two wars, stubbornly high inflation and further tightening of monetary policy. This was even as other major markets, such as the US, largely recovered in the year. In the 2023 calendar year, the AIM All-Share index fell 8.2% and is still 42% off its 2021 high. From the release of our 2023 top picks note, the average total return (assuming div

PROGRESSIVE: Vertu Motors: Traction control

Vertu is the fourth largest automotive retailer in the UK, with 188 sales outlets and a track record of cross-cycle growth, principally through businesses it has acquired, funded by equity, debt and most importantly cash generation. Vertu operates across the entire vehicle lifecycle, including new and used vehicle sales, and vehicle servicing, repair and parts. Service and repair is a 40+% gross margin repeating business. With economic headwinds, the transition to electric vehicles, recent overs

Dunelm Group - Appealing offer

Dunelm Group’s (DNLM’s) H124 results demonstrated the benefits of its strategy of broadening its addressable market by strengthening the core offer and expanding into newer categories, while also growing the store base and marketing more effectively. This is driving growth in the active customer base, who shop with greater frequency, leading to further market share gains in a static market. The broadening appeal of its products is demonstrated by growth being broad-based by geography, customer a

React Inititation of Coverage

React Group is a well-managed, growing UK services business with a high degree of recurring revenues (c87%).

LIBERUM: Safestay: First management contract opens up new revenue stream

Hybridan Small Cap Feast - 17 April 24

17th April 2024 * A corporate client of Hybridan LLP ** Arranged by type of listing and date of announcement *** Alphabetically arranged **** Potential means Intention to Float (ITF) has been announced Dish of the day Admissions: Delistings: What’s baking in the oven? ** Potential**** Initial Public Offerings: Reverse Takeovers: 16 April 2024: Electric Guitar (ELEG.L) Concurrent with its Admission to trading on AIM, Electric Guitar is proposing to acquire the entire issued share capital of 3radi

Hardman & Co Healthcare Index: 2023 – Capital demands dent performance

The Hardman & Co Healthcare Index (HHI) has been running since 2009. Its main function is to highlight the attractions of life sciences investments over the long term. For the second year running, apart from global economic influences affecting world markets, performance in 2023 was dented by the capital-intensive nature of the sector. The HHI fell 3.7%, to 483.8, underperforming the main London markets – FTSE 100 (+3.8%) and FTSE All-Share (3.8%) but outperforming the FTSE AIM All-Share Index (

ME Group - Modernising and growing the estate driving growth

During 2023, ME Group commenced the deployment of its next generation photobooths, which are integrated with the group’s newly developed proprietary software, gained market leadership in the Japanese photobooth market with an acquisition, continued to roll out laundry units with existing and new location partners, commenced a share buyback programme and gained entry into the FTSE 250. 2023 was a year of significant strategic and financial progress, with sales up 15%, EPS up 31% and net cash main