Saltaire-based technology giant Pace Micro Technology suffered a loss in the second half of last year but the company is confident of good performance this year.

The company's interim report released to the stock market today said it supplied 1.1 million set top boxes last year compared to 2.1 million in the same period the previous year. And, in the 26 weeks ending on December 3, it made a loss before tax and restructuring costs of £8.9 million.

Sales of its TV technology in the UK is declining but Pace chairman Sir Michael Bett said expanding sales abroad would see revenues improve.

Pace's sets have been installed in 20 million homes worldwide and it is the largest dedicated developer of digital set-top box technology and the largest supplier in Europe.

Sir Michael said: "Over the last six months Pace has won further new supply contracts with important digital TV operators around the world, continuing the momentum that is seeing Pace gain an increasing role in the payTV market in the developed world.

"Revenues are expected to improve significantly during the second half through shipments to the US as well as Premiere in Germany, UPC in The Netherlands, Foxtel in Australia and Sky New Zealand." Pace chief executive John Dyson said: "We expect the situation for the next period to be considerably better as we expect new technologies we are developing and the new customers we have gained to take more product from us."

Pace employs 500 people at its Saltaire headquarters and has offices in the USA, Hong Kong, Germany and France.

Pace's share price did dip at the tail end of 2005 after bosses issued a profit warning.