Pace Profit Rises 57% to $35.1-M on Robust Set-top Box Sales

Saltaire, UK, July 30, 2013 —  British set-top box maker Pace Plc said profits in the first half more than tripled, driven by continuing demand for its media-server products in North America and Latin American markets, which offset some softness in Europe.

Revenue grew 31 percent to $1.318 billion compared with $1.006 billion at this point last year. Profit rose by $35.1 million (57 percent) and adjusted EBITA rose to $96.7 million, delivering $92 million of free cash flow, a 95.1 percent adjusted EBITA to cash conversion ratio.

Pace basic earnings per share grew 221.6 percent to 16.4 cents while the interim dividend rose to 1.83 cents per share, a 27.1 percent increase on first half of 2012.

Pace said it anticipates that full year profits for the Group will be higher than previous guidance with revenues for FY2013 expected to be broadly in-line with 2012. But operating margin for FY2013 is expected to be greater than 7.5 percent, and strong cash flow to continue as Pace expects to report a net cash position.

Pace said it now enjoys PayTV hardware leadership and is now number one globally in Media Servers6, Set-top boxes7 and Telco Gateways8. It said it maintained position at the forefront of Media Server development with deployments at major operators including Liberty Global and Get TV.

STB and Media Server revenues were up 51.8 percent in H1 2013 driven largely by the continuing high demand for Media Servers from both Comcast and DirecTV. Pace said it has now shipped over 2 million Genie Advanced Whole-Home HD DVRs for DirecTV since launch in June 2012 and the next generation HR44 Genie Media Server and C41 mini Genie client devices are now in production.

Pace has also been selected by GCI, a cable operator in North America, to provide Media Servers running TiVo software and have a strong pipeline for this offering building on the strategic partnership with TiVo announced H1 2012.

Pace has been selected by Telefonica as the major supplier of High Definition Zapper and PVR devices for their IPTV operations in Latin America as part of their rollout of the Telefonica Global Service Platform. Initial deployments will take place in Brazil and Chile later in 2013.

Mike Pulli, Chief Executive Officer, said the 27.1 percent  increase in the interim dividend is in line with Pace’s progressive dividend policy and reflects both the solid cash flow performance as well as the Board’s continued confidence in the outlook and future prospects for Pace.

“We continue to make good headway on executing our strategy; key wins of both integrated Pace solutions and next generation hardware with major customers along with ongoing operational improvements give management confidence that we will make further progress in the second half of 2013 and beyond,” he said.