Pace Micro in red as sales dive

Plunging sales of digital TV set-top boxes have dragged manufacturer Pace Micro Technology into the red.

The group, which has borne the brunt of ITV Digital's collapse and the turmoil of cable operators NTL and Telewest, saw full-year sales halve to £166.1m.

That led to a pre-tax loss before one- off items of £16.2m ($26.4m), compared to a profit of £13.1m a year ago.

But Pace said results for the second half of the financial year had seen "a significant improvement".

The company said its performance had been boosted by a cost-cutting drive, which had seen its workforce shrink from 900 last year to around 650.

As a result, operating losses had been reduced to £400,000 in the second half from the £15.7m reported in the first half.

Pace, which has decided not to pay shareholders a dividend for last year, said it expected the UK market to stabilise at its current levels.