Zinc Media trading in line despite slow UK market

Television and content production company Zinc Media Group reported ongoing delays in the UK content commissioning market in an update on Monday.

The AIM-traded firm said that as of 30 June, it had secured and was set to recognize £28m in revenue for 2024, an increase of £4m since the last update at the end of April.

Additionally, £9m in revenue was in highly advanced stages of the pipeline, bringing the total potential revenue for 2024 to £37m.

That figure was slightly below the £38m recorded at the same time last year.

However, £2m in revenue initially secured for 2024 had been deferred to 2025 due to delays in client contract sign-offs and production starts, which would have otherwise kept the group on par with the prior year.

Despite the challenges, Zinc Media said it was trading in line with market expectations.

Notable new business wins included a returning daytime series for BBC One, a BBC quiz pilot, two returning series for UKTV's Dave, a feature documentary series for the BBC, and a new mini-series with an accompanying podcast for the Crime and Investigation channel called ‘Unbreakable’.

The latter represented a new client for the group.

Zinc added that its longer-term pipeline remained robust, with £10m of revenue either booked or in advanced discussions for 2025, double the amount at the same point last year for 2024.

Cash at the end of June totalled £4m, down from £4.9m at the end of December, reflecting the unwinding of advance payments for current productions and working capital movements.

In response to market headwinds, particularly from advertisers and brands in the UK, Zinc Media restructured its corporate video and branded content business within Zinc Communicate during the first half.

The board said the restructuring had resulted in an annualised £0.3m improvement in profitability, contributing to the group's target of achieving £0.5m in annualised savings by the end of 2025.

“At the halfway point in our financial year, the group has good visibility on £37m of revenue to be recognised in 2024, which puts us on track for another strong year,” said chief executive officer Mark Browning.

“We are conscious that some clients have delayed projects into 2025, and others are being slower to commit to start dates and this is evident in the amount of secured work.”

Browning said that reflected the continued short-term nature of the UK television market and instability in the Middle East affecting some international business.

“Nonetheless, our pipeline remains strong, and our forward bookings for 2025 are considerably ahead of where they normally are at this stage of the cycle, which provides the board with confidence in the group's ability to deliver continued profitable growth in 2024 and 2025.”

At 1422 BST, shares in Zinc Media Group were down 20.83% at 66.11p.

Reporting by Josh White for Sharecast.com.