Pace Plc (PIC.L), which develops products for subscription TV services, Thursday said it expects its operating profit for 2011 to fall below its prior outlook, due to the impact of closure of Western Digital Corp.'s Thailand factory on severe flooding. Western Digital is the major supplier of hard disk drives to Pace.
The company's shares are currently trading down more than 10 percent on the London Stock Exchange.
Pace said its operating profit for 2011 is now likely to fall below its previous guidance of $150 million to $170 million.
The U.K.- based distributor of digital television technologies for television and telecommunication industries, estimates the worst case impact on 2011 operating profit to be $9.5 million, before taking account of possible mitigating actions.
As Western Digital is the major supplier of hard disk drives to Pace, the closing of the factory will negatively impact Pace's expected shipments of products with hard disk drives during the remainder of the year.
However, Pace said it has completed an initial assessment of the potential impact on its 2011 business.
Pace also said it will provide its upcoming interim management statement, together with an update on its strategic review on November 17.
PIC.L is currently trading at 82 pence, down 10 pence or 10.87 percent, on a volume of 2.77 million shares, against an average three-month volume of 971 thousand shares on the LSE.
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