Zinc Media Group (LON:ZIN) is making waves in the entertainment industry, securing a pivotal contract that could transform its future. Known for its expertise in unscripted and factual TV, Zinc is now venturing into the world of high-profile entertainment programming—a move that has the potential to unlock significant international opportunities.
A Game-Changing Contract
Zinc, through its subsidiary Tern TV, has been chosen to produce a brand-new quiz show for the BBC. Titled The Inner Circle, the show will be hosted by Amanda Holden and is set to air on both Saturday and weekday evenings. More importantly, Zinc has not just been commissioned to produce the show—it also owns the programme’s intellectual property (IP). This means the company stands to gain from potential recommissions and lucrative international licensing deals if the format takes off globally.
The initial commission includes 25 episodes, generating an estimated £2 million in revenue. However, as Singer Capital Markets highlights, “this contract could materially scale over the short-term, and therefore potentially generate multiples of the initial (c.£2m) TCV.”
A New Era in Entertainment
This strategic move isn’t a mere experiment but a natural evolution for Zinc. The company has steadily expanded beyond its traditional focus on factual programming, positioning itself for new revenue streams and market opportunities. With entertainment formats historically enjoying strong global appeal, this expansion aligns perfectly with Zinc’s growth ambitions.
The appointment of industry heavyweight Andrea Hamilton—formerly a producer on Strictly Come Dancing—to lead Zinc’s new Premium Entertainment label further underscores the company’s commitment to this space.
A Well-Tested Path to Success
The road Zinc is embarking on has been well-trodden by other UK production powerhouses. Hit formats such as The Weakest Link, MasterChef, Who Wants to Be a Millionaire, and The Great British Bake Off have demonstrated the immense commercial potential of owning and licensing entertainment IP.
Singer Capital Markets draws a clear comparison, stating, “Shows like The Weakest Link, MasterChef, Who Wants to Be a Millionaire and Bake Off have been hugely successful franchises for the IP owner… We see the same potential for Zinc in due course.”
Financial Strength and Growth Prospects
Zinc’s financials show a business that is growing and strengthening. Revenue increased from £30.1 million in 2022 to £38.9 million in 2023, and while a slight dip to £34 million is expected in 2024, projections for 2025 suggest a rebound to £41.4 million. Adjusted EBITDA is forecasted to continue improving, reaching £2.1 million by 2025.
Singer Capital Markets is bullish on Zinc’s valuation, setting a 12-month target price of 163p, representing a potential upside of 183.5% from the current share price of 57.5p.
Final Thoughts
Zinc Media Group’s latest move into entertainment could be a defining moment for the company. With a flagship BBC quiz show in hand, a new entertainment division led by a seasoned industry professional, and the potential for international expansion, Zinc is positioning itself for significant long-term gains.
Singer Capital Markets sums it up well: “If even a tenth of this potential comes off, Zinc is wildly undervalued in our view.”
With an ambitious roadmap ahead, investors will be watching closely to see how Zinc capitalises on this transformative opportunity.
