24th Apr 2014 08:04
LONDON (Alliance News) - Pace PLC Thursday reiterated confidence in its full-year outlook, as despite seeing lower revenue, it improved margins during the year to date.
Pace creates technology products for broadcast and broadband applications.
Pace previously forecast in March that it expects revenues for 2014 to be around USD2.7 billion, up from USD2.47 billion in the previous year. It expects its operating margin for the year to be around 8.5%, compared to 7.8%. It is targeting USD185 million of free cash flow for the year.
The company said that its revenues so far in 2014 were lower than in same period in 2013, as its Media Servers and Gateway product revenues were hit by a customer dual-sourcing component parts for their products from both Pace and another manufacturer.
However, gross margins are well ahead of 2013, Pace said, as it improved its revenue mix and integrated its acquisition Aurora Networks Inc.
Operating costs, excluding Aurora, continued to decline, Pace said. Profitability has been in line with Pace's expectations for the period.
The company said its integration of Aurora was largely complete, and it expects it to be a "significant" profit and cash contributor for the year. It is looking to make cost savings of USD4 million during the year, and USD8 million in 2015, from the integration.
Shares in Pace were trading up 2.8% at 409.00 pence Thursday morning.
By Hana Stewart-Smith; [email protected]; @HanaSSAllNews
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