Pace plc suffers setback after shares slump 14%

March 9, 2011 - PRLog -- UK-based Pace plc, the world's largest developer of payTV set-top boxes, has suffered a major setback, with shares in the company slumping by 14%. The reduced share price has knocked GBP£100M from its stock market value.

However, the market's response may prove to be an over-reaction, since the company has a pattern of strong underlying profit growth and a positive long term position.

Chief Executive Neil Gaydon told the press in a statement, "One customer on a specific project decided to accelerate a new piece of technology, which meant the revenue from that client has shifted from 2011 to 2012,"

Gaydon explained that the US customer has decided to leapfrog a generation of development of its home DVR (digital video recorder) equipment. "The good news is we are improving profitability so we are on track to achieve our earnings despite this."

Adjusted core earnings rose 36% in 2010 to 103.6 million GBP after the Pace plc shipped 22.2 million devices for cable, satellite and IPTV. Customers included Comcast, DirecTV and AT&T. Sales were up 17.4 percent to GBP£1.33 billion.

Analysts at the Royal Bank of Scotland (RBS) reported that the company's results were higher than anticipated, corresponding to a sound year of growth and a successful acquisition strategy. Yet revenue outlook is said to be "marginally lower than our expectations, due to deferrals at one specific customer and implies flat revenues in the core business."

Pace, based in Saltaire in West Yorkshire in the UK, had pre-tax profits of GBP£71.1 million after GBP£19 million of exceptional costs. This represents an increase 1.7%.

The value of the consumer electronics market in the G8 countries is expected to reach a value of $195,229.7 million in 2014.

Author: Lynn Shaw, Analyst

Please click here for additional information: http://www.companiesandmarkets.com/news/pace-plc-suffers-...

# # #

Browse 450,000 market research reports and company profiles covering major markets, companies and countries. www.companiesandmarkets.com is a central source of market research reports from the world’s leading analysts and report publishers.