Pace plc AGM and Interim Management StatementMonday, April 19th, 2010
Mike McTighe, Chairman of Pace plc (LSE:PIC), the leading independent developer of digital TV technologies for the global payTV industry, will give the following update at the Company’s Annual General Meeting later today:
“In the Preliminary results announcement on 2 March we updated our outlook for 2010. I am pleased to report that trading has continued in line with our expectations and Pace continues to deliver against management’s plan.
“We entered 2010 in a strong operating and financial position with our payTV markets continuing to be positive and with good demand for the Group’s products. For the full year we expect a combination of solid volume growth and a modestly lower ASP resulting from product mix, to lead to mid single digit revenue growth. Gross margins are expected to increase, with a focus on operating cost and efficiency generating further improvements in operating margin. We will also continue tight management of the supply chain as we manage a sector-wide risk of component shortages.
“The FIFA World Cup, which will be broadcast in HD and 3D formats, will result in first half performance being ahead of the second half as operators ship ahead of this major sporting event. Overall the Group continues to look forward to another successful year and has maintained a strong balance sheet and robust financial position.
“We have continued to develop our strategy to be at the heart of home entertainment convergence for the payTV industry, the next evolutionary shift in our market. In 2009 we established initial market leadership with the launch of our Home Content Sharing product in the US. The acquisition of Paris-based IP and cable gateways specialist Bewan, which closed during the period, is another step towards our convergence goal. Bewan complements and strengthens Pace’s existing gateway business: advanced residential gateways will become increasingly important to payTV operators as they develop converged home entertainment services.
“During the period Pace announced several new customer contracts, which included Astro selecting us for Malaysia’s first HD service, a new Microsoft Mediaroom-based set-top box and second generation set-top box for BT Vision in the UK and a new range of Freeview HD products in the UK. We also announced another new partner for Pace Networks, Space TV, to lead the rollout of MultiDweller® across Africa.”