Pace turns in strong performance

Pace CEO, Mike Pulli

TV technology and set-top provider Pace has turned in an improved operating profit on lower revenue in its first half results, reporting adjusted EBITA of US$118 million (€108 million), up 11% on revenue of US$1.078 billion, down 5.3%. Profit after tax was up 54.2% to US$85.4 million.

Pace, which is in the process of being acquired by Arris, said it had improved its result through an improved product mix, improved supply chain efficiency and increased operational efficiency.

Non consumer-premises equipment revenue increased by 34% to US$225 million, driven by demand for Pace Networks products in Latin America.

The company expects revenue for the full year to be in the range of US$2.65 billion to US$2.72 billion, thanks to an expected uptick in the second half driven by new products and additional demand for existing products. Adjusted EBITA for the full year is expected to be about US$255 million.

Pace said Arris’s acquisition of the company was “progressing in line with expectations” and is expected to close in the fourth quarter.

“I am pleased to report we have had a solid first half of the year. As expected, revenue was lower than the comparable period as challenging economic conditions, the strength of the US Dollar and industry consolidation reduced demand in a number of regions. However, through a broader mix of revenue, improving supply chain effectiveness and continuing improvements in operational efficiency, the Group has shown the flexibility to continue to deliver improved profitability and strong cash generation despite weaker trading conditions,” said CEO Mike Pulli.

“Whilst we are focused on closing the transaction with ARRIS, we continue to make good progress on executing our strategy as a standalone entity; key wins, deployments and increasing demand coupled with ongoing operational improvements give us confidence that we will maintain our momentum and make further progress in the second half of 2015 and beyond.”