Pace Plc Profit Triples On Demand From North America

Pace (LSE: PIC), a global developer of technologies and products for PayTV and broadband service providers, today announced results for the six months ending 30 June.

The set-top box maker posted a strong first-half performance, with revenues up 31% to $1.32bn compared with $1bn at this point last year — driven largely by strong growth in the massive North American and Latin American markets, which offset some softness in Europe.

Innovation and leadership in hardware helped fuel Pace’s success, with revenue from Media Servers, the next generation device for use in the home, contributing more than $300m revenue growth during the six months.

Other highlights for the period include:

  • Pre-tax profits rocketed up from $21.4m to $68.1m.
  • Adjusted EBITA for the six months was up 57% to $96.7m, while free cash flow reached $92m.
  • A reduction in net debt from $163.3m as reported at the end of December to $68.2m for the period.
  • A 27.1% increase in the interim dividend to 1.83 cents per share, to be paid 6 December.

Commenting on the results, Mike Pulli, chief executive officer, said:

“Pace has had a strong first half. Revenue growth in the period was driven largely by the continuing demand for Media Server products in North America. The revenue growth coupled with our continued focus on operating efficiency has enabled Pace to deliver significant EPS growth and a third consecutive half of strong cash generation.”

For the rest of 2013, Pace says it will continue to execute on its three-pronged strategy of transforming its core economics, becoming a leader in PayTV hardware, and increasing its presence in software, services, and integrated solutions.

Pace says it expects revenues to be broadly in line with 2012 though it anticipates full-year profits to be higher than previous guidance.

CEO Pulli notes: “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.”

Pace has handsomely rewarded shareholders to the tune of 56% share price gains since the first of the year, and investors are no doubt tuning in to see how Pace executes in the second half.

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> Jill does not own shares of any company mentioned