Zoo Digital Group Plc · LSE:ZOO
Zoo Digital — Investor Presentation (October 2020)
39 slides from Zoo Digital's investor presentation, October 2020
Slide 1: Introduction to ZOO Digital Group plc
ZOO Digital Group plc Introduction to ZOO Digital Group plc October 2020 www.zoodigital.com
Slide 2: Disclaimer
ZOO Digital Group plc Disclaimer This document has been prepared by ZOO Digital Group plc (the “Company”) solely for presentation purposes. It should not be reproduced, redistributed or passed to any other person. This document, the talks given by the presenters, the information communicated during
Slide 3: ZOO Digital Group plc
ZOO Digital Group pic Cloud-powered subtitling, dubbing and distribution for the global TV and movie industry erty % ‘e I oy ‘a *, “7 * ba * ba > \ * (i DVIRCON COMPANY SONY PICTURES —_ NBC # UNIVERSAL FACEBOOK VIACOMCES ( Wf ) wecnonn
Slide 4: A Changing Consumer Market…
ZOO Digital Group plc A Changing Consumer Market… 4
Slide 5: …leads to growth in media localization
ZOO Digital Group plc …leads to growth in media localization $3bn+ Access Services 18% Subtitling 12% Dubbing 70% Estimated worldwide market spend; sources: (1) Media and Entertainment Services Alliance, May 2019, (2) Slator 2020, (3) ZOO Digital 5
Slide 6: OTT Video Phase 1: 2006–2019/20 Platform-first Services
ZOO Digital Group plc OTT (Over-the-Top) Video Phase 1: 2006–2019/20 Platform-first Services • Market dominated by platform-first Phase 1 supply chain companies Studios • Content licensed from: • Major media producers (usually non- exclusively) • Independent studios (often exclusively) • Leading OTT
Slide 7: OTT Phase 2: 2019/20 onwards: Direct to Consumer Services
ZOO Digital Group plc OTT Phase 2: 2019/20 onwards: Direct to Consumer Services • Several major media producers launch Phase 2 supply chain ‘Direct to Consumer’ (DTC) services • Some have announced their intention to OTT Services including DTC discontinue licensing to other OTT providers • This will
Slide 8: Fulfilment of content for streaming VOD
ZOO Digital Group plc Fulfilment of content for streaming VOD End-to-End Vendor Subtitling New productions Dubbing Delivery to Conforming platform Catalogue titles Media processing Metadata 8
Slide 9: ZOO Core Services – Media Localization
ZOO Digital Group plc ZOO Core Services – Media Localization Subtitling Dubbing Porque tengo el corazón valiente For I have a brave heart, Voy a quererte, voy a quererte I'll love you, I'll love you! 🎶 🎶 For I have a brave heart, I'll love you, I'll love you! 9
Slide 10: ZOO Core Services – Digital Packaging
ZOO Digital Group plc ZOO Core Services – Digital Packaging MPEG-4, M-JPEG, … Video 720p, 1080p, 4K, … 24fps, 25fps, 30fps, … EN, FR, ES, PCM Audio Dolby 2.0, 5.1, … DE, IT, … … .srt Closed .cap Captions/SDH … .stl Subtitles .scc … Audio MPG Description WAV … JPG, PNG, … Dimensions Artwork … Title S
Slide 11: ZOO’s USP: Cloud-based media localization technology
ZOO Digital Group plc ZOO’s USP: Cloud-based media localization technology Subtitling production & management Dubbing production & management Original language script production & management Workflow management Localization operations management 11
Slide 12: Growth – Four Strategic Pillars
ZOO Digital Group plc Growth – Four Strategic Pillars INNOVATE SCALE COLLABORATE PARTNER … by creating value- … through a freelance … with like-minded, Secure preferred partner adding cloud software network world-class experts in status with leading technology media localization, buyers education an
Slide 13: Strategy: Innovate
ZOO Digital Group plc Strategy: Innovate 13
Slide 14: Innovation in Dubbing
ZOO Digital Group plc Innovation in Dubbing From this… …to this 14
Slide 15: Vendor Selection by Large Buyers
ZOO Digital Group plc Vendor Selection by Large Buyers* Ad-hoc Approved/ Primary engagement Preferred Vendor Vendor Appointment: Trialing new Selected following Selected from vendors RFP† preferred vendors following RFP† Work frequency: Sporadic projects Regular projects Regular projects Volume: Occ
Slide 16: ZOO Localization Ecosystem
ZOO Digital Group plc ZOO Localization Ecosystem ZOO Localization Ecosystem Freelancer • Scenario planning ZOOsubs ZOOdubs Network • Progress tracking • Vendor metrics ZOOcore ZOOhive • Ordering of: ZOO • Subtitling ZOOvault ZOOscripts Enabled Client OTT • Captioning Operations • Dubbing ZOOecho ZOO
Slide 17: End-to-End Model
ZOO Digital Group plc End-to-End Model • ZOO Localization Ecosystem supports end-to- end service requirements of ZOO target customers • Interconnected production and management platforms • Brings more efficiency, standardization, transparency & security to media localization than ever before • Helps
Slide 18: Business Model and Segments
ZOO Digital Group plc Business Model and Segments Software solutions Legacy systems SaaS Media processing US$1,631* Format conversion Metadata creation Digital packaging Formatting Compliance editing US$7,411* etc. Subtitling Localization Captioning US$20,751* Dubbing Audio description * Audited FY
Slide 19: Sales bridge 2017 to 2020
ZOO Digital Group plc Sales bridge 2017 to 2020 35 Client A up $9.8 million 5.4 30 29.8 Client B up $1.7 million -0.9 6.8 Client C up $2.6 million 25 Client D down $1.0 million 20 5.5 DVD now only $0.6 million 16.7 15 Licenses now only $1.6 million -3.7 10 5 0 2017 DVD DP Subs Dubs Licences 2020 Tra
Slide 20: Journey by customer to $100m sales
ZOO Digital Group plc Journey by customer to $100m sales OTT Revenue Services Media Producers Client A Group Client A OTT Legacy Service Time 20
Slide 21: Sales Bridge to $100m
ZOO Digital Group plc Sales Bridge to $100m 120 $100 million breakdown: 25 100 100 • Digital packaging $15 million 10 • Subtitling $30 million 80 • Dubbing $55 million 29 60 Market share of addressable 6.2 market: 40 29.8 • Current share in 2020, 4% 20 • 10% of $1 billion of Hollywood spend 0 Client
Slide 22: Investment Summary
ZOO Digital Group plc Investment Summary • Strategy – technology-first approach to media localization • Scalability – cloud-based, agile, scales through partners and freelancers • Growth – large expanding international market still in its infancy • Culture – steeped in the industry with long track r
Slide 23: Outlook
ZOO Digital Group plc Outlook • Market disruption in shift to Direct-to-Consumer services creates significant growth opportunities • ZOO uniquely placed to capitalize from impact of COVID-19 • New customer wins provide the scope for sustained revenue ramp • Technology-led approach provides distinct
Slide 24: ZOO Digital Group plc www.zoodigital.com
ZOO Digital Group plc www.zoodigital.com
Slide 25: Appendix
ZOO Digital Group plc Appendix 25
Slide 26: COVID-19 ZOO impact
ZOO Digital Group plc COVID-19 ZOO impact • ZOO well placed to benefit from wider market acceptance • Seamless transition to working from home • Temporary softening of sales in February/March as customers moved to WFH • Increased interest in ZOOdubs; Q1 dubbing projects up 3x over prior year • Order
Slide 27: COVID-19 Industry impact
ZOO Digital Group plc COVID-19 Industry impact • New feature and TV productions halted • Curtailed orders for originals • Customer focus has switched to back catalogue • Situation expected to continue into calendar 2021 • Traditional dubbing vendors significantly impacted • Closed during lockdown •
Slide 28: Hours of Content by Platform (US)
ZOO Digital Group plc Hours of Content by Platform (US) US streaming catalogue sizes 2020H1 Total catalogue size of US studio (content hours)* streaming alignments (content hours)* 60,000 SVOD majors average 60,000 Disney+ & Hulu 42,000 hours Shown with 50,000 50,000 major studio 40,000 40,000 conte
Slide 29: Major Global OTT Platforms
ZOO Digital Group plc Major Global OTT Platforms Launch 2006 2007 2007 Nov ’19 Nov ’19 Apr ’20 May ’20 Early ‘21 Paid 150m 186m 35m 10m 60m 10m 36m (inc n/a subscribers HBO) Countries >200 190 US only; >100 21 US only; US only; TBC int’l in Int’l roll- int’l in int’l in 2021 out in 2021 2021 progres
Slide 30: ZOO-Enabled Dubbing Studios
ZOO Digital Group plc ZOO-Enabled Dubbing Studios • Traditional dubbing studios trained in the use of ZOOdubs • Enables efficiencies and consistent treatment across languages • Gives clients the option to record certain voices or languages in familiar settings 30
Slide 31: Project Case Study – The Bletchley Circle: San Francisco
ZOO Digital Group plc Project Case Study – The Bletchley Circle: San Francisco • Project: Eight 60-minute episode crime drama TV series • Producer: ITV • Client: Kew Media Distribution • Platform: Netflix • Services: • Script creation • Subtitles created for 17 languages • Dubbing created for three
Slide 32: Media Localization Vendor Landscape
ZOO Digital Group plc Media Localization Vendor Landscape Media Localizers +$25m SME Media Localizers LSPs / Non-Media $215m, US France $764m, US ($7.3m) operating loss $185m, UK < $13m, UK Brazil $366m, UK $94m, UK UK US US $58m adj. EBITDA $84m, France $17m, Australia $34m, US India France India (
Slide 33: Major competitors in Media Localization
ZOO Digital Group plc Major competitors in Media Localization • Deluxe Entertainment – US headquartered; Chapter 11 process in 2020 when ownership passed from PE to debt providers; Distribution group acquired by PE; offers wide range of entertainment services; owns two dubbing studios; media localiz
Slide 34: Consolidated Statement of Comprehensive Income March 2020
Consolidated Statement of ZOO Digital Group plc Comprehensive Income March 2020 2020 2019 $000 $000 Revenue 29,793 28,818 Cost of sales (19,705) (19,624) Gross Profit 10,088 9,194 Other operating income 252 157 Other operating expenses (10,896) (10,671) Operating (loss)/profit (556) (1,320) Analysed
Slide 35: Consolidated Statement of Financial Position as at 31 March
Consolidated Statement of ZOO Digital Group plc Financial Position as at 31 March 2020 2019 $000 $000 ASSETS Non-current assets Property, plant and equipment 3,633 944 Intangible assets 6,692 6,624 Deferred income tax assets 486 486 10,811 8,054 Current assets Trade and other receivables 9,323 8,103
Slide 36: Consolidated Statement of Cash Flows
ZOO Digital Group plc Consolidated Statement of Cash Flows 2020 2019 $000 $000 Cash flows from operating activities Operating (loss)/profit for the year (556) (1,320) Depreciation 532 553 Amortisation and impairment 1,068 904 Share based payments 290 397 Changes in working capital: Increases in trad
Slide 37: Management Team
ZOO Digital Group plc Management Team Gillian Wilmot Since July 2019 Extensive board level leadership in private and public Chairman environments with industry experience across B2B, technology, advertising and communications. Strengths in value creation, operational insight and corporate governance
Slide 38: Major Shareholders
ZOO Digital Group plc Major Shareholders Shareholder* % of capital Stuart Green (CEO) 15.47 Herald Investment Management 11.33 Invesco Ltd 9.39 Canaccord Genuity Group Inc. 8.89 Kabouter Management LLC 4.27 Janus Henderson Investors 3.46 Sarasin & Partners 3.19 Cavendish Asset Management 3.00 * Base
Slide 39: ZOO Digital Group plc www.zoodigital.com
ZOO Digital Group plc www.zoodigital.com
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