Strike action in Hollywood hits results at entertainment industry tech group
ZOO Digital Group, says the first joint strike of Hollywood actors and writers in more than 60 years has impacted its performance, as it issues its unaudited financial results for the six months ended 30 September 2023.
The Sheffield-headquartered media localisation business saw its revenues fall by 58% to $21.4m/£16.9m (H1 FY23: $51.4m/£40.5m) primarily as a result of the strikes.
Gross profit decreased by 87% to $2.1m/£1.7m (H1 FY23: $16.5m/£13m) and the company made a pre-tax loss of $10.1m/£8m (H1 FY21: $3.5m/£2.8m pre tax profit).
However, the business says that with the resolution of the strikes, it can look to the future with optimism and has forecast a phased return of orders in the second half, accelerating into FY25.
Stuart Green, CEO, acknowledged the year to date had been overshadowed by the Hollywood dispute.
He added: “This temporary disruption has had a significant impact across our sector and the wider media and entertainment industry, resulting in artificially low production volumes in the short-term.
“While this has had a significant impact on our financial performance, we have taken targeted measures to conserve cash while positioning the business to recover rapidly once orders return to more usual levels.
“As the streaming industry focuses increasingly on profitability, we are already seeing evidence that major buyers are relying on fewer vendors and prioritising those with end-to-end capacity and scale.
“This puts ZOO in a strong position to process higher volumes of work from customers over time, particularly as we make strategic investments in customers’ high-priority growth regions.”