Thai floods to hit Pace profits into next year
Nick Clark is the arts correspondent of The Independent. He joined the newspaper in June 2007, initially reporting on the stock markets. He has covered beats including the City, and technology, media and telecoms and made the switch to arts in December 2011. He has also contributed articles to the sports section.
Friday 18 November 2011
Pace, the biggest set-top box maker in the world, warned that the impact of the floods in Thailand could hit profits by as much as $50m (£32m) next year.
The Yorkshire-based group has already taken a $9.5m hit on operating profits following the devastating floods which hit the production of hard drives for its TV boxes.
After discussions with suppliers and customers, it yesterday forecast that profits in 2012 would be between $35m and $50m lower than previously expected.
Neil Gaydon, Pace's chief executive, said: "In common with the broader consumer electronics industry, the immediate impact to our business of the Thailand flooding is significant, requiring diligent management." He added: "We've hit a bump, but we will get through it."
The Thai operation of Western Digital provided over 60 per cent of the hard drives found in Pace's personal video recorder boxes.
Mr Gaydon said: "We're not out of the woods yet; 2012 will be very tight. But the hard drive situation will go away. It is a one-off event of extraordinary magnitude."
The group also revealed the results of a strategic review, launched in May. Mr Gaydon said the overhaul would give a "clear roadmap to increased operating profit".
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