Pace profit jumps on North American sales

Tue Mar 5, 2013 2:33am EST
 
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March 5 (Reuters) - British set-top box maker Pace Plc said full-year profit rose 46 percent, boosted by higher demand from North American clients such as Comcast Corp and DirecTV, but forecast 2013 revenue to be almost at last year's levels.

The company, which supplies decoders to global television operators like Virgin Media Inc, Sky Deutschland AG and AT&T Inc, said it expects operating margin to increase to about 7.5 percent this year from 6.6 percent last year.

Pace's revenue rose 4.1 percent to $2.4 billion in 2012, helped by higher demand in the fourth quarter. Revenue in North America, the company's largest market, increased about 24 percent to $1.32 billion.

Pretax profit increased to $80.1 million from $54.7 million.

Strong demand for Pace's next-generation media servers - advanced set-top boxes such as the DMS7000 and DMC7000 - in its North American market prompted the company to raise its earnings forecast twice last year, despite a weak first half.

"We believe the digital PayTV market in North America will continue to see low single-digit annual growth in subscribers for the foreseeable future," the company said.

The set-top box market has become hotly competitive with the entry of companies like Apple Inc, Amazon.com Inc and Netflix Inc. Even chipmaker Intel Corp has begun eyeing it.

Pace's shares closed at 227.5 pence on the London Stock Exchange on Monday.