ZOO Digital Group plc (AIM: ZOO), a specialist provider of end-to-end cloud-based localisation and media services to the global entertainment industry, has just provided investors with more detail on its global growth strategy to scale its operations by establishing regional hubs in key international locations.
Accelerated growth in international distribution of regional content, alongside the launch of new global direct-to-consumer platforms, continues to generate strong demand and opportunity for ZOO Digital’s globalisation and media services, the company said. In order to align with its clients’ current and future objectives in fast-growing territories, ZOO Digital is finalising investments to expand its geographic footprint in key content sourcing and distribution locations, namely Turkey, Korea, Thailand, India, Japan and Malaysia.ZOO Digital’s share price has seen some solid growth in the last year, up from around 50-60p to trade at 127p at time of writing. According to data from Stockopedia, both institutional and private investors continue to back the story. The company currently has a market cap of £111m with an enterprise value of £114m.
ZOO is one of just a few global vendors with the proven capability to deliver complete end-to-end services to ready content for audiences in all languages and formats, owing to its cloud-based technology ecosystem and collaborative network of independent dubbing studios, vendor partners and freelance actors and translators.
It said that the regional investments will further strengthen its offering by simplifying access to new territories, thereby helping clients to overcome the challenges of localising and fulfilling huge volumes of original and catalogue content, as well as supporting the increasing need to prepare locally acquired TV shows and movies for streaming services around the world.
The new hubs are also expected to support the business development team by providing wider international coverage and access to new markets.
An increasingly global audience
“Southeast Asia, the Middle East and India are all experiencing rapid growth as content centres for an increasingly global audience,” said Stuart Green, CEO of ZOO Digital. “Our expansion in these regions will add scale to ZOO’s operations, further diversify our revenues and provide access to new talent pools in lower cost economies. For our clients, it will enable us to deliver even higher levels of creativity, quality and security in some of the fastest-growing and most important regions for media companies. By aligning our business with their growth ambitions in these territories, we are well positioned to support our clients’ content requirements and capitalise on new market opportunities.”
The expanded ZOO Digital Group will continue to consist of long-established businesses that have been affiliate partners to ZOO for several years. These companies, which include media services providers and localisation vendors, already have extensive experience working in the proprietary cloud-based technology used by ZOO throughout its global ecosystem of partners and freelancers.
The all-encompassing approach is intended to support unrestricted creativity while enforcing high standards of production quality, workflow efficiency and content security across the entire global group.
ZOO Digital has seen consistent revenue growth over the last few years and was not fazed by the pandemic. It is, however, starting to look a little expensive, with a forecast PE ratio of 58.1 (12 months). While return on capital has been excellent, it is beginning to look a bit expensive for us.
