Zoo Digital to raise £1.7m

10th Aug 2011 07:16

Film software firm Zoo Digital reported an increase in full year operating profit and said it plans to raise £1.7m through a share placing.Adjusted operating profit rose to $1.3m for the year ended 31 March 2011 from $0.8m in 2010. Revenues slipped to $14m from $15m a year earlier."The decline in revenue arose from two primary causes: a short-term slowdown in projects from our largest customer during a major organisation change and a reduction in the amount of low margin subtitling work which has traditionally been subcontracted to a third party vendor," the group explained in company statement.Cash generation was also affected by this temporary slowdown in orders. The year-end cash balance was reduced to $0.6m from $1.2m before. In a separate statement Zoo announced a share placing of 4.25m new ordinary shares to raise £1.70m and restructuring of loan notes."Net proceeds of the placing will accelerate the roll-out of software in new markets, particularly eBooks," the group said."One particularly exciting prospect is within the eBook market, where ZOO's suite of tools have been developed to format books for the EST market in a superior and more cost effective way than existing methods. To this end, we are delighted to have secured an additional $2.8m of funding from shareholders, primarily to accelerate our presence in this rapidly growing market." CEO Stuart Green added, "New opportunities continue to present themselves and it has become ever more apparent that our solutions are relevant to a wide range of industries outside of our traditional stronghold of Hollywood."---CJ