Set-top box maker Pace reveals that last year beat expectations

 
Oliver Smith
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PACE, the set-top box maker, saw its share price jump three per cent yesterday after it said sales had performed above expectations during 2013.

In a trading update Pace said its full year revenue is expected to be up 2.4 per cent to $2.46bn (£1.49bn) when the firm reports its results on 3 March. Shares in Pace closed at 352.1p on the news yesterday.

“We continue to lead the market in innovation with great products and services, demand from our customers has remained strong and we continue to win new business,” said chief executive Mike Pulli.

Pace on Monday also completed its $310m (£191.7m) purchase of US network firm Aurora. Referring to the acquisition, Pulli said: “This will strengthen Pace’s position as a market leading solutions provider for the PayTV and broadband industries.”

Analysts said the update showed that Pace had been making good progress over the past year and in its acquisition of Aurora.

“The recent acquisition of Aurora is a sensible strategic move, bought with cash and debt, in our view,” said Jefferies analyst Lee Simpson.

“We suspect the existing cash conversion at Pace, together with synergies from this deal, should see pay-off inside two years and the group return to net cash in 2015. Acquisitions won’t stop there – we expect them to do more of the same on a near annual basis.”

Pace also reported its 2013 operating margin would come in at 7.7 per cent, 1.1 percentage points ahead of 2012’s. Its free cash flow was in excess of $200m, up from $182.7m in 2012.