Pace expects higher first-half revenue

(Reuters) - British set-top-box maker Pace Plc said it expects revenue for the first half to higher than the year-ago period, driven by continuing demand for its media-server products in North America.

The company, which supplies decoders to global television operators like Virgin Media Inc, Sky Deutschland AG and AT&T Inc, reported an encouraging start to the year with revenue and profitability in line with its expectations.

Last month, Pace reported a 46 percent rise in full-year profit, boosted by higher demand from North American clients such as Comcast Corp and DirecTV.

It also said at the time that it expects operating margin to increase to about 7.5 percent in 2013 from 6.6 percent last year.

North America accounted for more than half of the company's revenue in 2012.

Pace's 2012 first-half was hurt by a disruption in supply of hard disk drives due to flooding in Thailand in late 2011.

The set-top-box market has become hotly competitive with the entry of companies like Apple Inc, Inc and Netflix Inc. Even chipmaker Intel Corp is preparing to enter the market.

Pace shares closed at 232 pence on Tuesday on the London Stock Exchange. They have gained more than a fifth of their value since the beginning of the year.

(Reporting by Abhirup Roy in Bangalore; Editing by Roshni Menon)