a world leader in digital and broadband technologies
annual report  accounts 2011
annual report  accounts 2011
mktra2011
front  back coverindd 13 12032012 1240 02 highlights
04 chairman’s letter
05 chief executive officer’s review
08 chief financial officer’s review
11 report of the directors
22 directors’ remuneration report
31 statement of directors’ responsibilities
32 independent auditors’ report
35 financial statements
42 notes to the financial statements
78 directors secretary and advisers
79 five year record and shareholder information
contents
01    pace plc 2011 annual report pace plc 2011 annual report    
front  back coverindd 46 12032012 1240
83 pace plc 2011annual report    02
north america  
revenues
1065m 27
europe  
revenues
458m 19
rest of the world  
revenues
318m 13
latin america  
revenues
469m 25
revenue 23093m  
2010 restated 20629m 119 
underlying earnings
1
 1414m  
2010 restated 1606m 120 
return on sales
2
 61 2010 restated 78   17ppt 
operating profit preexceptionals 857m 
2010 restated 1425m  399 
profit before tax 547m  
2010 restated 1102m  504 
adjusted
3
 basic eps 297c  
2010 restated 371c 199
full year proposed dividend per ordinary  
share 375c 2010 restated 337c  113 
financial highlights
global revenues
pace’s customers which today include 
over 160 of the world’s leading paytv and 
broadband operators are shaping the  
inhome entertainment and communications 
experience with their digital hd hybrid 
home networking and broadband services 
pace’s capabilities address a paytv 
operator’s requirements whatever their stage  
or rate of development
pace is growing a 
broad platform across 
hardware software 
and services for 
paytv operators
1  
underlying earnings are operating profit before exceptional costs 
and amortisation of other intangibles and are also expressed as 
adjusted ebita
2  
adjusted ebita as a per cent of sales is expressed as return on 
sales
3  
adjusted eps is based on earnings before the post tax value of 
exceptional costs and amortisation of other intangibles 
front end 2011 v10indd 3 16032012 1125 pace plc 2011 annual report    04 03    pace plc 2011 annual report
we are now ﬁ rmly 
focused on execution 
and delivering a 
ﬁ tter more proﬁ table 
business with strong 
cash ﬂ ow
“i am pleased to report results in line 
with the guidance issued in november 
2011 following the strategic review 
and actions subsequently taken there is 
a clear route to delivering a successful 
2012 for pace our focus on operational 
improvement and effi ciency is already 
starting to deliver tangible results and 
will contribute further to our future 
competitive advantage we continue to 
strategically invest in leveraging our 
technology assets across our markets”
mike pulli 
chief executive offi cer
chairman’s letter
through the ‘ups and bumps’ the group has made progress 
in key areas during the year including the successful integration 
of the businesses we acquired during 2010 development of 
advanced technologies such as the settop box for the “x1” 
platform for comcast and the home media centre for directv 
and the strong growth we continue to see in developing 
markets particularly latin america
pace’s core is its engineering excellence complemented by 
strong customerfocused skills and delivery capabilities
following the appointment of mike pulli as chief executive 
offi cer in december 2011 we have the right leader to deliver 
on the opportunities to grow shareholder value identifi ed by 
our strategic review it confi rmed that pace operates in large 
growing and profi table markets with differentiated capabilities 
and established as the group’s primary objectives
•	 	to	build	on	our	position	as	a	world	leading	settop	box	and	
residential gateway company
•	 to	impr ove	on	operational	excellence	and
•	 	to	accelerate	‘widening	out’	by	pursuing	opportunities	to	
provide software  services assets
executing on these objectives will lead to a realistic medium 
term operating margin target of up to 9 as well as increasing 
the group’s ‘sticky profi ts’ – which translates to enhanced 
quality of earnings and therefore multiple
despite challenges experienced during 2011 operational focus 
undertaken since the strategic review and confi dence in the 
longterm earnings potential from our markets gives the board 
confi dence to continue building on the progressive dividend 
policy that was introduced in 2009 therefore the board is 
recommending a fi nal dividend of 250c per share giving a full 
year dividend of 375c per share an 113 increase on 2010
if you have any comments on my letter or any part of the annual 
report i would be delighted to hear from you either by writing 
to me at pace or by email at allanleightonpacecom
yours sincerely
allan leighton
chairman
6 march 2012
dear shareholder
2011 has been a challenging year 
for pace but despite this the board 
believes that there is real potential for 
pace to become a ‘great technology 
company’ and confi dence that the 
areas of focus identifi ed through our 
strategic review undertaken during 
the year provides a path to unlocking 
its full value
front end 2011 v10indd 45 16032012 1125 pace plc 2011 annual report    04 03    pace plc 2011 annual report
we are now ﬁ rmly 
focused on execution 
and delivering a 
ﬁ tter more proﬁ table 
business with strong 
cash ﬂ ow
“i am pleased to report results in line 
with the guidance issued in november 
2011 following the strategic review 
and actions subsequently taken there is 
a clear route to delivering a successful 
2012 for pace our focus on operational 
improvement and effi ciency is already 
starting to deliver tangible results and 
will contribute further to our future 
competitive advantage we continue to 
strategically invest in leveraging our 
technology assets across our markets”
mike pulli 
chief executive offi cer
chairman’s letter
through the ‘ups and bumps’ the group has made progress 
in key areas during the year including the successful integration 
of the businesses we acquired during 2010 development of 
advanced technologies such as the settop box for the “x1” 
platform for comcast and the home media centre for directv 
and the strong growth we continue to see in developing 
markets particularly latin america
pace’s core is its engineering excellence complemented by 
strong customerfocused skills and delivery capabilities
following the appointment of mike pulli as chief executive 
offi cer in december 2011 we have the right leader to deliver 
on the opportunities to grow shareholder value identifi ed by 
our strategic review it confi rmed that pace operates in large 
growing and profi table markets with differentiated capabilities 
and established as the group’s primary objectives
•	 	to	build	on	our	position	as	a	world	leading	settop	box	and	
residential gateway company
•	 to	impr ove	on	operational	excellence	and
•	 	to	accelerate	‘widening	out’	by	pursuing	opportunities	to	
provide software  services assets
executing on these objectives will lead to a realistic medium 
term operating margin target of up to 9 as well as increasing 
the group’s ‘sticky profi ts’ – which translates to enhanced 
quality of earnings and therefore multiple
despite challenges experienced during 2011 operational focus 
undertaken since the strategic review and confi dence in the 
longterm earnings potential from our markets gives the board 
confi dence to continue building on the progressive dividend 
policy that was introduced in 2009 therefore the board is 
recommending a fi nal dividend of 250c per share giving a full 
year dividend of 375c per share an 113 increase on 2010
if you have any comments on my letter or any part of the annual 
report i would be delighted to hear from you either by writing 
to me at pace or by email at allanleightonpacecom
yours sincerely
allan leighton
chairman
6 march 2012
dear shareholder
2011 has been a challenging year 
for pace but despite this the board 
believes that there is real potential for 
pace to become a ‘great technology 
company’ and confi dence that the 
areas of focus identifi ed through our 
strategic review undertaken during 
the year provides a path to unlocking 
its full value
front end 2011 v10indd 45 16032012 1125 pace plc 2011 annual report    06 05    pace plc 2011 annual report
chief executive
officer’s review
key highlights of the year
pace’s markets have remained resilient during the year 
with paytv continuing to show growth despite difficult 
global economic conditions overall digital paytv 
subscribers are expected to grow at circa 10 cagr 
between 2011 and 2015 overthetop ott delivery 
is expected to be complementary to continued paytv 
growth paytv in advanced markets has embraced ip 
and internet delivery with next generation ‘ip fluent’ 
devices having become a market reality in addition home 
networking technologies such as wifi are becoming 
increasingly important as is the emergence of tv 
everywhere technology pace is at the forefront of enabling 
operators to address the opportunities presented by these 
advanced technologies further opportunities exist for 
pace in emerging markets as these continue greenfield 
growth and their conversion to digital
2011 has been a challenging year operationally for pace 
with the company addressing inventory management 
issues and reduced profitability in pace europe as well as 
the impact of two major natural disasters the disruption 
to hard disk drive hdd supply resulting from flooding in 
thailand was a major challenge in the final quarter of 2011 
and will continue to impact results during 2012 with the 
impact to be predominantly felt during the first half of the 
year through keen operational focus working closely with 
suppliers and customers the impact of this issue was 
contained to 36m of revenue and 9m of operating 
profit in 2011
pace generated 2011 revenues of 23093m 
up 119 on 2010 due to the fullyear effect 
of 2010 acquisitions and adjusted ebita of 
1414m equivalent to 61 of revenues 
down 17ppt on 2010 our strategic review 
highlighted opportunities for improving both 
the level and quality of our earnings we are 
actively delivering to this plan
i am pleased to be able to report the 2011 annual results for pace the first since my 
appointment as chief executive officer on 14 december 2011 whilst pace has faced a 
number of operational challenges in 2011 our strategic review identified a number of 
opportunities which if well executed will deliver significant value for shareholders over the 
coming years
all of the businesses acquired by pace in 2010 have 
been successfully integrated with the related synergies 
realised ahead of and in excess of our expectations in 
particular the acquisition of 2wire continues to deliver 
benefits to the group both through increased revenue 
and profitability and through the technology assets which 
enable us to offer operators the additional applications 
and services that consumers are demanding in the more 
developed markets in which pace operates there is a shift 
towards the use of internet delivery technology for the 
distribution and viewing of content the combination of 
gateway expertise acquired with 2wire and bewan and 
the existing settop box stb technology within pace 
provides a strong platform from which to capitalise on 
these opportunities
north america
the paytv market in north america is the most 
technologically advanced characterised by the increasing 
emergence of whole home stbs and vdsl tripleplay 
gateways as services demand higher speeds we believe 
the digital paytv market in north america will continue to 
see low single digit annual growth in subscribers for the 
foreseeable future
total revenues in north america increased by 27 to 
1065m in 2011 driven by the full year impact of the 
2wire acquisition in october 2010 organic revenues 
comprising stb sales in the cable and satellite markets 
decreased by 177 to 595m reflecting lower sales 
of personal video recorder pvr products and a 
normalisation of our leadership position achieved in 2010 
on certain customer specific products volumes of stbs 
in north america increased by 33 reflecting a higher 
number of lowervalue digital television adapter dta 
shipments in the year whilst other stb volumes declined 
pace did introduce a number of advanced products in the 
developed north america market including the stb for 
the “x1” platform for comcast and a whole home solution 
for directv these confirmed pace’s continued position 
of technological leadership in our sector and we remain 
optimistic about the longterm strength of the market for 
our products in north america
gateway revenues increased by 294m to 392m 
reflecting the full year of trading from 2wire on a like
forlike basis revenue decreased 8 as a result of a pull 
forward of adsl product into 2010 underlying growth 
adjusted for this was 10 
software  services revenues in north america increased 
by 60m to 78m up 11 on a likeforlike basis this 
revenue is primarily comprised of customer care system 
management products and professional services
latin america 
the latin america market displays strong subscriber growth 
and ongoing conversion to digital and is heavily influenced by 
the us market showing a strong appetite for high definition 
hd products
total revenues in latin america increased by 25 to 469m 
in 2011 with strong underlying growth from both satellite 
and cable operators as pace continued to experience very 
high market share in these expanding markets particularly in 
brazil
growth was entirely from the organic business and mirrored 
growth in our customers’ subscriber bases volume growth 
was ahead of revenue growth at 77 reflecting a higher 
proportion of lower value standard definition sd boxes 
the businesses acquired during 2010 had relatively little 
activity in this region however there are opportunities in 
these markets to deliver integrated solutions comprising 
pace hardware and software
over the last two years pace’s performance has been 
particularly strong in latin america as we have been first to 
market with new products during digital conversion such 
as hd boxes and pvrs again demonstrating technological 
leadership in the sector however this has resulted in an 
unsustainably high market share in these territories which 
we expect to normalise in the next 12 – 24 months as 
competition in the market for the supply of these products 
increases
europe
the market in europe is characterised by high levels of 
hd and pvr penetration addition of hybrid services and 
increasing levels of home networking
revenues in europe declined by 19 to 458m in 2011 
driven by a decline in the stb business as pace ceased retail 
sales and exited from low margin business in italy
the welldeveloped western european market is primarily 
focused on hdconversion with over 90 of revenues 
relating to hd products furthermore over 35 of european 
stb sales included a pvr functionality
residential gateways remain a small proportion of the 
overall european business with revenue of 29m software 
 services revenue of 18m includes the latens content 
protection systems device software and maintenance 
services in support of stb sales the strategic review 
identified significant opportunities among midtier operators 
in europe for integrated solutions incorporating our software 
assets and we are focused on developing opportunities in 
this segment of the market
 
source ihs screen digest february 2012
front end 2011 v10indd 67 16032012 1125 pace plc 2011 annual report    06 05    pace plc 2011 annual report
chief executive
officer’s review
key highlights of the year
pace’s markets have remained resilient during the year 
with paytv continuing to show growth despite difficult 
global economic conditions overall digital paytv 
subscribers are expected to grow at circa 10 cagr 
between 2011 and 2015 overthetop ott delivery 
is expected to be complementary to continued paytv 
growth paytv in advanced markets has embraced ip 
and internet delivery with next generation ‘ip fluent’ 
devices having become a market reality in addition home 
networking technologies such as wifi are becoming 
increasingly important as is the emergence of tv 
everywhere technology pace is at the forefront of enabling 
operators to address the opportunities presented by these 
advanced technologies further opportunities exist for 
pace in emerging markets as these continue greenfield 
growth and their conversion to digital
2011 has been a challenging year operationally for pace 
with the company addressing inventory management 
issues and reduced profitability in pace europe as well as 
the impact of two major natural disasters the disruption 
to hard disk drive hdd supply resulting from flooding in 
thailand was a major challenge in the final quarter of 2011 
and will continue to impact results during 2012 with the 
impact to be predominantly felt during the first half of the 
year through keen operational focus working closely with 
suppliers and customers the impact of this issue was 
contained to 36m of revenue and 9m of operating 
profit in 2011
pace generated 2011 revenues of 23093m 
up 119 on 2010 due to the fullyear effect 
of 2010 acquisitions and adjusted ebita of 
1414m equivalent to 61 of revenues 
down 17ppt on 2010 our strategic review 
highlighted opportunities for improving both 
the level and quality of our earnings we are 
actively delivering to this plan
i am pleased to be able to report the 2011 annual results for pace the first since my 
appointment as chief executive officer on 14 december 2011 whilst pace has faced a 
number of operational challenges in 2011 our strategic review identified a number of 
opportunities which if well executed will deliver significant value for shareholders over the 
coming years
all of the businesses acquired by pace in 2010 have 
been successfully integrated with the related synergies 
realised ahead of and in excess of our expectations in 
particular the acquisition of 2wire continues to deliver 
benefits to the group both through increased revenue 
and profitability and through the technology assets which 
enable us to offer operators the additional applications 
and services that consumers are demanding in the more 
developed markets in which pace operates there is a shift 
towards the use of internet delivery technology for the 
distribution and viewing of content the combination of 
gateway expertise acquired with 2wire and bewan and 
the existing settop box stb technology within pace 
provides a strong platform from which to capitalise on 
these opportunities
north america
the paytv market in north america is the most 
technologically advanced characterised by the increasing 
emergence of whole home stbs and vdsl tripleplay 
gateways as services demand higher speeds we believe 
the digital paytv market in north america will continue to 
see low single digit annual growth in subscribers for the 
foreseeable future
total revenues in north america increased by 27 to 
1065m in 2011 driven by the full year impact of the 
2wire acquisition in october 2010 organic revenues 
comprising stb sales in the cable and satellite markets 
decreased by 177 to 595m reflecting lower sales 
of personal video recorder pvr products and a 
normalisation of our leadership position achieved in 2010 
on certain customer specific products volumes of stbs 
in north america increased by 33 reflecting a higher 
number of lowervalue digital television adapter dta 
shipments in the year whilst other stb volumes declined 
pace did introduce a number of advanced products in the 
developed north america market including the stb for 
the “x1” platform for comcast and a whole home solution 
for directv these confirmed pace’s continued position 
of technological leadership in our sector and we remain 
optimistic about the longterm strength of the market for 
our products in north america
gateway revenues increased by 294m to 392m 
reflecting the full year of trading from 2wire on a like
forlike basis revenue decreased 8 as a result of a pull 
forward of adsl product into 2010 underlying growth 
adjusted for this was 10 
software  services revenues in north america increased 
by 60m to 78m up 11 on a likeforlike basis this 
revenue is primarily comprised of customer care system 
management products and professional services
latin america 
the latin america market displays strong subscriber growth 
and ongoing conversion to digital and is heavily influenced by 
the us market showing a strong appetite for high definition 
hd products
total revenues in latin america increased by 25 to 469m 
in 2011 with strong underlying growth from both satellite 
and cable operators as pace continued to experience very 
high market share in these expanding markets particularly in 
brazil
growth was entirely from the organic business and mirrored 
growth in our customers’ subscriber bases volume growth 
was ahead of revenue growth at 77 reflecting a higher 
proportion of lower value standard definition sd boxes 
the businesses acquired during 2010 had relatively little 
activity in this region however there are opportunities in 
these markets to deliver integrated solutions comprising 
pace hardware and software
over the last two years pace’s performance has been 
particularly strong in latin america as we have been first to 
market with new products during digital conversion such 
as hd boxes and pvrs again demonstrating technological 
leadership in the sector however this has resulted in an 
unsustainably high market share in these territories which 
we expect to normalise in the next 12 – 24 months as 
competition in the market for the supply of these products 
increases
europe
the market in europe is characterised by high levels of 
hd and pvr penetration addition of hybrid services and 
increasing levels of home networking
revenues in europe declined by 19 to 458m in 2011 
driven by a decline in the stb business as pace ceased retail 
sales and exited from low margin business in italy
the welldeveloped western european market is primarily 
focused on hdconversion with over 90 of revenues 
relating to hd products furthermore over 35 of european 
stb sales included a pvr functionality
residential gateways remain a small proportion of the 
overall european business with revenue of 29m software 
 services revenue of 18m includes the latens content 
protection systems device software and maintenance 
services in support of stb sales the strategic review 
identified significant opportunities among midtier operators 
in europe for integrated solutions incorporating our software 
assets and we are focused on developing opportunities in 
this segment of the market
 
source ihs screen digest february 2012
front end 2011 v10indd 67 16032012 1125 pace plc 2011 annual report    08 07    pace plc 2011 annual report
chief executive
officer’s review continued
our strategic review identified that 
significant value would be delivered 
through operational excellence and 
widening out our customer offering  
in 2012 we will be focused on 
executing against these goals
a consistent trend we are seeing is that customers in 
the more developed european markets are showing an 
increased interest in more complex products for example 
those incorporating home networking and customer 
management systems this trend is directly aligned with 
the widening out objective identified in our strategic review 
and provides an opportunity for increased product margins 
and greater quality of earnings
rest of world
revenues in the rest of the world increased by 13 
to 318m driven by growth in the stb business pace 
operates in a mixture of developed notably australia and 
new zealand and developing markets including india and 
subsaharan africa
growth in developed markets has been driven by moves 
towards more technologically advanced products 
reflecting similar trends as in europe with operators 
wanting products with increased functionality such as 
wifi widening out our offering in these areas is key to the 
delivery of our strategic review
in developing markets growth to date has been at the high 
end of the market with hd and pvr products comprising 
the majority of sales we do see significant opportunities 
in these markets for further growth as the uptake of paytv 
and digitisation continues and greenfield opportunities 
allow pace to build its footprint with new customers
in summary
our strategic review confirmed that pace operates in 
large profitable and growing markets it also identified 
that significant value to shareholders would be delivered 
through increasing operational excellence and widening out 
the customer offering to leverage our software and services 
assets 2012 will be the year in which our progress towards 
these goals is dependent on our ability to execute on these 
focuses 
mike pulli 
chief executive officer
6 march 2012
chief financial
officer’s review
2011 proved a challenging year operationally for pace due to two natural disasters 
group inventory management issues and reduced profitability within pace europe 
despite this 23093m of revenue and 1414m of adjusted ebita were delivered
the first natural disaster was the japanese tsunami 
in march which impacted the supply chain mitigating 
actions were taken and the situation is now resolved  
the second was the severe flooding in thailand in 
october which impacted the supply of hdd this affected 
revenue by 363m and profits by 89m in 2011 and is 
expected to be felt throughout 2012 our revised estimate 
of the impact on 2012 operating profit is 25m35m of 
which the majority will fall in the first half
the group inventory management issues gave rise to 
excess inventory buildup in the first half of 2011 and 
actions to resolve this matter were implemented yearend 
inventory of 150m was low due to the hdd shortage and 
we anticipate normal levels of inventory at circa 180m in 
2012
profitability issues identified within pace europe are being 
addressed and a reorganisation as part of our strategic 
review is underway annualised savings of circa 7m are 
targeted with an exceptional charge of 111m taken in 
2011 integration of the 2010 acquisitions was successful 
with the targeted 30m annual synergies delivered both 
sooner and larger than originally anticipated
with a broader product base encompassing stbs 
residential gateways and software  services the group  
is well positioned for 2012 and beyond 
currency
following the full integration of the 2010 acquisitions into 
the group the business incurs and sources a significant 
majority of revenues and costs in us dollars
the strategic decision was made to reduce the foreign 
exchange risk within the business and change both the 
functional and presentational currency of the group 
and company to us dollars from 1 january 2011 this 
decision allows the financial statements to be presented 
in the currency of the primary economic environment in 
which it operates comparative information has been re
stated in us dollars to reflect this change
summary financials
     restated
    2011  2010  
    m  m
revenue  23093 20629
gross profit  4433 3951
gross margin   192 192
administrative expenses before 
exceptional costs and amortisation  3019 2345
adjusted ebita
1 
 1414 1606
adjusted ebita  61 78
exceptional costs  127 295
amortisation of other intangibles  557 181
net finance expense  183 28
tax charge  159 329
profit after tax   388 773
adjusted basic earnings per share  297c 371c
net debt
2 
 3217 3111
working capital
3  
1788 1150
free cashflow
4
  361 590
each of the above measures are used within the business as 
key performance indicators kpis
group trading and results
revenues of 23093m 2010 restated 20629m 
increased by 119 due to the full year effect of the 2010 
acquisitions which contributed 5213m to revenue our 
organic business saw a 71 decrease in revenues of 
which 19ppt related to hdd supply shortages in q4 52ppt 
of the decline reflects ceasing retail sales and exiting low 
margin business in europe adjusted ebita of 1414m 
2010 restated 1606m which at 61 of sales revenue 
was down 17ppt on 2010
gross profit of 4433m 2010 restated 3951m was 
consistent as a percentage of revenue at 192 2010 
192 gross margin in the organic business was down 
23ppt from 2010 at 163 impacted by the profitability 
issues disclosed in our may interim management statement 
and the hdd impact in q4 gross margin in the acquired 
businesses improved 19ppt to 291 which was partly 
attributable to a nonrecurring release of deferred revenue
overheads increased by 674m to 3019m 2010 restated 
2345m driven by the full year effect of 2010 acquisitions 
at 924m these were lower than the comparative full year 
charge in 2010 due to the operational synergies delivered 
ahead of plan in the first half overheads in the organic 
business at 2094m were 07 lower year on year
1 
adjusted ebita is operating profit before exceptional costs and amortisation of 
other intangibles
2 
net debt is borrowings net of cash and cash equivalents
3 
working capital is inventories trade and other receivables net of trade and other  
 payables
4 
free cash flow is set out in note 31 to the financial statements
front end 2011 v10indd   89 16032012   1125 pace plc 2011 annual report    08 07    pace plc 2011 annual report
chief executive
officer’s review continued
our strategic review identified that 
significant value would be delivered 
through operational excellence and 
widening out our customer offering  
in 2012 we will be focused on 
executing against these goals
a consistent trend we are seeing is that customers in 
the more developed european markets are showing an 
increased interest in more complex products for example 
those incorporating home networking and customer 
management systems this trend is directly aligned with 
the widening out objective identified in our strategic review 
and provides an opportunity for increased product margins 
and greater quality of earnings
rest of world
revenues in the rest of the world increased by 13 
to 318m driven by growth in the stb business pace 
operates in a mixture of developed notably australia and 
new zealand and developing markets including india and 
subsaharan africa
growth in developed markets has been driven by moves 
towards more technologically advanced products 
reflecting similar trends as in europe with operators 
wanting products with increased functionality such as 
wifi widening out our offering in these areas is key to the 
delivery of our strategic review
in developing markets growth to date has been at the high 
end of the market with hd and pvr products comprising 
the majority of sales we do see significant opportunities 
in these markets for further growth as the uptake of paytv 
and digitisation continues and greenfield opportunities 
allow pace to build its footprint with new customers
in summary
our strategic review confirmed that pace operates in 
large profitable and growing markets it also identified 
that significant value to shareholders would be delivered 
through increasing operational excellence and widening out 
the customer offering to leverage our software and services 
assets 2012 will be the year in which our progress towards 
these goals is dependent on our ability to execute on these 
focuses 
mike pulli 
chief executive officer
6 march 2012
chief financial
officer’s review
2011 proved a challenging year operationally for pace due to two natural disasters 
group inventory management issues and reduced profitability within pace europe 
despite this 23093m of revenue and 1414m of adjusted ebita were delivered
the first natural disaster was the japanese tsunami 
in march which impacted the supply chain mitigating 
actions were taken and the situation is now resolved  
the second was the severe flooding in thailand in 
october which impacted the supply of hdd this affected 
revenue by 363m and profits by 89m in 2011 and is 
expected to be felt throughout 2012 our revised estimate 
of the impact on 2012 operating profit is 25m35m of 
which the majority will fall in the first half
the group inventory management issues gave rise to 
excess inventory buildup in the first half of 2011 and 
actions to resolve this matter were implemented yearend 
inventory of 150m was low due to the hdd shortage and 
we anticipate normal levels of inventory at circa 180m in 
2012
profitability issues identified within pace europe are being 
addressed and a reorganisation as part of our strategic 
review is underway annualised savings of circa 7m are 
targeted with an exceptional charge of 111m taken in 
2011 integration of the 2010 acquisitions was successful 
with the targeted 30m annual synergies delivered both 
sooner and larger than originally anticipated
with a broader product base encompassing stbs 
residential gateways and software  services the group  
is well positioned for 2012 and beyond 
currency
following the full integration of the 2010 acquisitions into 
the group the business incurs and sources a significant 
majority of revenues and costs in us dollars
the strategic decision was made to reduce the foreign 
exchange risk within the business and change both the 
functional and presentational currency of the group 
and company to us dollars from 1 january 2011 this 
decision allows the financial statements to be presented 
in the currency of the primary economic environment in 
which it operates comparative information has been re
stated in us dollars to reflect this change
summary financials
     restated
    2011  2010  
    m  m
revenue  23093 20629
gross profit  4433 3951
gross margin   192 192
administrative expenses before 
exceptional costs and amortisation  3019 2345
adjusted ebita
1 
 1414 1606
adjusted ebita  61 78
exceptional costs  127 295
amortisation of other intangibles  557 181
net finance expense  183 28
tax charge  159 329
profit after tax   388 773
adjusted basic earnings per share  297c 371c
net debt
2 
 3217 3111
working capital
3  
1788 1150
free cashflow
4
  361 590
each of the above measures are used within the business as 
key performance indicators kpis
group trading and results
revenues of 23093m 2010 restated 20629m 
increased by 119 due to the full year effect of the 2010 
acquisitions which contributed 5213m to revenue our 
organic business saw a 71 decrease in revenues of 
which 19ppt related to hdd supply shortages in q4 52ppt 
of the decline reflects ceasing retail sales and exiting low 
margin business in europe adjusted ebita of 1414m 
2010 restated 1606m which at 61 of sales revenue 
was down 17ppt on 2010
gross profit of 4433m 2010 restated 3951m was 
consistent as a percentage of revenue at 192 2010 
192 gross margin in the organic business was down 
23ppt from 2010 at 163 impacted by the profitability 
issues disclosed in our may interim management statement 
and the hdd impact in q4 gross margin in the acquired 
businesses improved 19ppt to 291 which was partly 
attributable to a nonrecurring release of deferred revenue
overheads increased by 674m to 3019m 2010 restated 
2345m driven by the full year effect of 2010 acquisitions 
at 924m these were lower than the comparative full year 
charge in 2010 due to the operational synergies delivered 
ahead of plan in the first half overheads in the organic 
business at 2094m were 07 lower year on year
1 
adjusted ebita is operating profit before exceptional costs and amortisation of 
other intangibles
2 
net debt is borrowings net of cash and cash equivalents
3 
working capital is inventories trade and other receivables net of trade and other  
 payables
4 
free cash flow is set out in note 31 to the financial statements
front end 2011 v10indd 89 16032012 1125 pace plc 2011 annual report    10 09    pace plc 2011 annual report
amortisation of other intangibles reflecting a full year charge 
of assets arising from acquisitions increased to 557m 
2010 restated 181m net financing charges of 183m 
2010 restated 28m reflects a full year charge from debt 
raised in 2010 to fund acquisitions tax was 159m 2010 
restated 329m which gave an effective tax rate of 291 
2010 299 
adjusted basic earnings per share was 297c 2010 restated 
371c and basic earnings per share was 132c 2010 
restated 264c
exceptional costs of 127m arose from the programme to 
reorganise pace europe and the change in ceo
segmental analysis
following the integration of the 2010 acquisitions into the 
group coupled with a restructuring of the business the 
group now operates through strategic business units 
sbus which comprise pace americas pace europe pace 
enterprise and pace india
the sbus are deemed by the board to represent operating 
segments under ifrs 8 with revenues and adjusted ebita 
as follows
    restated
    2011  2010  
    m  m
revenue  
pace americas  13506 11206
pace europe  8718 9188
pace enterprise  540 210
unallocated
 
 329 25
total revenue  23093 20629
adjusted ebita  
pace americas  1579 1467
pace europe  683 857
pace enterprise  121 74
unallocated   727 644
total adjusted ebita  1414 1606
although not wholly consistent revenues in north america 
belong primarily to the americas sbu revenues in europe 
and rest of world belong largely to the europe sbu 
revenues in latin america belong to both the americas and 
europe sbus and pace enterprise revenues are derived from 
north america europe and rest of world
pace americas’ revenue increased by 205 to 13506m 
and includes the impact on the us business from the 
2wire acquisition which completed in october 2010 pace 
enterprise revenue increased by 1571 to 540m and 
includes the nonus 2wire business bewan acquired in 
april 2010 and latens acquired in november 2010
pace europe revenue decreased by 51 to 8718m as a 
result of exiting low margin business the reportable result 
for each of the sbus is consistent with the impact on our 
organic business and acquisitions described throughout  
this report
unallocated revenues increased 304m to 329m of which 
the majority relates to pace india and due to immateriality 
does not warrant separate disclosure unallocated adjusted 
ebita includes the profit impact from such revenues 
in addition to head office costs and other unallocated 
overheads
financial position
balance sheet
goodwill decreased by 28m from the previously stated 
sterling equivalent at 31 december 2010 to 3356m as 
adjustments were made to the provisional fair values of prior 
year acquisitions within the measurement period details 
of the adjustments made are shown within note 11 to the 
financial statements
intangible development expenditure assets increased by 
93m primarily as a result of the capitalisation of project 
costs within the former 2wire business
tangible fixed assets increased by 103m as the group 
invested 415m in additions 2010 restated 315m the 
increase from the previous year was mainly due to planned 
nonrecurring capital expenditure on existing and new 
facilities throughout the group of 121m
provisions of 870m 2010 restated 868m include 
105m in respect of the restructuring plan in france which 
was announced in november
liquidity and cash flows
working capital was 1788m 2010 restated 1150m 
the increase was due to the lower level of trade and other 
payables in 2011 compared to 2010 which was partly 
offset by reductions in both inventory and trade and other 
receivables
year end net debt was 3217m 2010 restated 3118m 
during the year two scheduled facility repayment 
instalments were paid of 375m each at june and 
december 2011 the remaining facility continues to be 
repaid through payments of 375m every six months with 
a final payment of 75m due in 2014
the directors are confident that the company will be 
strongly cash flow positive in 2012 plans and processes are 
in place to achieve this end
the company’s committed bank facilities are more than 
sufficient to meet our short to medium term funding needs 
and visibility of our forward orders for 2012 is good
chief financial
officer’s review continued
the board recommends a final 
dividend of 250c per ordinary share 
the full year proposed dividend 
increases 113 to 375c per 
ordinary share
critical accounting policies
the directors consider that the group has the following 
critical accounting policies as they require the use of 
estimates and are subjective in their nature
•	 revenue	r ecognition
•	 impairment
•	 t axation
•	 pr ovisions
•	 intangible	assets
•	 hedge	accounting
details of accounting policies and estimates can be found 
within the notes to the financial statements
dividend
in line with the progressive dividend policy the board has 
recommended a final dividend of 250c per ordinary share 
2010 restated 225c the full year proposed dividend 
increases 113 to 375c per share 2010 restated 337c
outlook
we enter 2012 in a strong financial position which will 
allow us to manage the impact of hdd supply disruption 
and deliver on the opportunities identified in the strategic 
review
stuart hall 
chief financial officer
6 march 2012
front end 2011 v10indd   1011 16032012   1125 pace plc 2011 annual report    10 09    pace plc 2011 annual report
amortisation of other intangibles reflecting a full year charge 
of assets arising from acquisitions increased to 557m 
2010 restated 181m net financing charges of 183m 
2010 restated 28m reflects a full year charge from debt 
raised in 2010 to fund acquisitions tax was 159m 2010 
restated 329m which gave an effective tax rate of 291 
2010 299 
adjusted basic earnings per share was 297c 2010 restated 
371c and basic earnings per share was 132c 2010 
restated 264c
exceptional costs of 127m arose from the programme to 
reorganise pace europe and the change in ceo
segmental analysis
following the integration of the 2010 acquisitions into the 
group coupled with a restructuring of the business the 
group now operates through strategic business units 
sbus which comprise pace americas pace europe pace 
enterprise and pace india
the sbus are deemed by the board to represent operating 
segments under ifrs 8 with revenues and adjusted ebita 
as follows
    restated
    2011  2010  
    m  m
revenue  
pace americas  13506 11206
pace europe  8718 9188
pace enterprise  540 210
unallocated
 
 329 25
total revenue  23093 20629
adjusted ebita  
pace americas  1579 1467
pace europe  683 857
pace enterprise  121 74
unallocated   727 644
total adjusted ebita  1414 1606
although not wholly consistent revenues in north america 
belong primarily to the americas sbu revenues in europe 
and rest of world belong largely to the europe sbu 
revenues in latin america belong to both the americas and 
europe sbus and pace enterprise revenues are derived from 
north america europe and rest of world
pace americas’ revenue increased by 205 to 13506m 
and includes the impact on the us business from the 
2wire acquisition which completed in october 2010 pace 
enterprise revenue increased by 1571 to 540m and 
includes the nonus 2wire business bewan acquired in 
april 2010 and latens acquired in november 2010
pace europe revenue decreased by 51 to 8718m as a 
result of exiting low margin business the reportable result 
for each of the sbus is consistent with the impact on our 
organic business and acquisitions described throughout  
this report
unallocated revenues increased 304m to 329m of which 
the majority relates to pace india and due to immateriality 
does not warrant separate disclosure unallocated adjusted 
ebita includes the profit impact from such revenues 
in addition to head office costs and other unallocated 
overheads
financial position
balance sheet
goodwill decreased by 28m from the previously stated 
sterling equivalent at 31 december 2010 to 3356m as 
adjustments were made to the provisional fair values of prior 
year acquisitions within the measurement period details 
of the adjustments made are shown within note 11 to the 
financial statements
intangible development expenditure assets increased by 
93m primarily as a result of the capitalisation of project 
costs within the former 2wire business
tangible fixed assets increased by 103m as the group 
invested 415m in additions 2010 restated 315m the 
increase from the previous year was mainly due to planned 
nonrecurring capital expenditure on existing and new 
facilities throughout the group of 121m
provisions of 870m 2010 restated 868m include 
105m in respect of the restructuring plan in france which 
was announced in november
liquidity and cash flows
working capital was 1788m 2010 restated 1150m 
the increase was due to the lower level of trade and other 
payables in 2011 compared to 2010 which was partly 
offset by reductions in both inventory and trade and other 
receivables
year end net debt was 3217m 2010 restated 3118m 
during the year two scheduled facility repayment 
instalments were paid of 375m each at june and 
december 2011 the remaining facility continues to be 
repaid through payments of 375m every six months with 
a final payment of 75m due in 2014
the directors are confident that the company will be 
strongly cash flow positive in 2012 plans and processes are 
in place to achieve this end
the company’s committed bank facilities are more than 
sufficient to meet our short to medium term funding needs 
and visibility of our forward orders for 2012 is good
chief financial
officer’s review continued
the board recommends a final 
dividend of 250c per ordinary share 
the full year proposed dividend 
increases 113 to 375c per 
ordinary share
critical accounting policies
the directors consider that the group has the following 
critical accounting policies as they require the use of 
estimates and are subjective in their nature
•	 revenue	r ecognition
•	 impairment
•	 t axation
•	 pr ovisions
•	 intangible	assets
•	 hedge	accounting
details of accounting policies and estimates can be found 
within the notes to the financial statements
dividend
in line with the progressive dividend policy the board has 
recommended a final dividend of 250c per ordinary share 
2010 restated 225c the full year proposed dividend 
increases 113 to 375c per share 2010 restated 337c
outlook
we enter 2012 in a strong financial position which will 
allow us to manage the impact of hdd supply disruption 
and deliver on the opportunities identified in the strategic 
review
stuart hall 
chief financial officer
6 march 2012
front end 2011 v10indd 1011 16032012 1125 pace plc 2011 annual report    12 11    pace plc 2011 annual report
report of
the directors
principal activities
the group’s principal activities are the development design and distribution of technologies and products for 
managed subscription television telephony and broadband services and the provision of engineering design 
and software applications to its stb and gateway customers the group also provides related support services 
including systems integration and customer care centres 
business and financial results
the information that fulfils the requirements of the business review and management report including a review 
of the group’s activities developments and the financial results for the year and the key financial performance 
indicators relevant to the business of the company principally revenue gross margin  ebita profit before tax 
return on sales and net debt can be found in the chief executive officer’s review and the chief financial officer’s 
review on pages 5 to 10 the aforementioned information is incorporated in this report by reference there is no 
information which falls to be disclosed pursuant to s 417 5 of the companies act 2006 other than as noted in 
the risks and uncertainties section below
risks and uncertainties
the following are the key risks and uncertainties relevant to the business of the group
customers and markets
orders placed by the group’s paytv and telecoms customers are typically large oneoff orders for delivery over 
a number of months with supplemental orders for additional volumes as the eventual deployment of the stbs 
or gateways can be unpredictable revenues can be volatile the difficulty in predicting the group’s business flow 
and its risks can be exacerbated by a number of other factors including for example the development process 
for an advanced stb which can take over 12 months the group works on long lead times eg 4 months or 
more for component supply and manufacture typical of the industry in the us market in particular customers’ 
firm order lead times may be less than the component lead times there are third party delivery risks for example 
difficulties in the delivery of components or software code and the final order for manufacture and firm contractual 
commitment is usually dependent on product approvals and acceptance both from the operator and sometimes 
from third parties the group is also exposed to the industry wide inherent risk of supply chain failure the group 
has put in place procedures to monitor the financial and operating strength of key suppliers in addition it utilises 
dual or multi source suppliers where appropriate to mitigate this risk
product liability claims
in common with many companies in the industry the group is exposed to the risk of product liability claims made 
by customers or affected third parties should the group’s products not fulfil the terms of the contracts under which 
they are sold the group has in place quality control and other operational procedures to mitigate this risk
credit risk
the finance function of the group obtains reports from third party sources in respect of the credit worthiness of key 
customers and suppliers and sets individual credit limits as appropriate a credit insurance policy is maintained 
which provides cover over certain debtors where it is economically viable subject to excesses and the exposure to 
credit risk is monitored on an ongoing basis deposit investments are generally undertaken only in liquid securities 
and with counterparties that have appropriate credit ratings
royalties
the group’s products incorporate third party technology usually under licence inadvertent actions may expose the 
group to the risk of infringing third party intellectual property rights potential claims can be submitted many years 
after a product has been deployed
regulatory
the group is subject to a broad range of laws regulations and standards and remains exposed to changes in the 
regulatory environment including potential modifications to import duty regimes and legislation relevant to the 
group’s products and services it is pace’s policy to require that all its subsidiaries comply with applicable laws 
regulations and standards 
currency risks
the standard ‘industry currency’ is the us dollar with the majority of components and manufacturing capacity 
purchased in this currency however due to part of the group’s revenues being in sterling and euros the group is 
exposed to the risk of foreign currency movements to manage this risk the group’s treasury policy is progressively 
to cover cash flows when these are sufficiently certain and to seek price variations through contractual mechanisms 
where significant currency movements occur
financial results
the consolidated income statement for the year is set out on page 35 the profit before tax was 547m 2010 
restated 1102m and the profit before tax interest exceptional items and amortisation of other intangibles was 
1414m 2010 restated 1606m
foreign currency
during the year the board determined to change the company’s functional and group’s presentational currency to 
us dollars usd given that the significant majority of revenues and costs are generated and incurred in usd
dividend
the directors recommend the payment of a final dividend of 250c per ordinary share 2010 restated 225c to be 
paid on 4 july 2012 to shareholders on the register at the close of business on 8 june 2012 an interim dividend of 
125c per ordinary share was paid during the year 2010 restated 112c
dividends will be paid in sterling equivalent to 1575 pence per ordinary share this is based on an exchange rate 
of £  1587 being the rate applicable on 5 march 2012
share capital
details of the company’s share capital including changes for the year and the rights attaching to the ordinary 
shares are contained in note 21 and are incorporated in this report by reference
significant shareholdings 
the company has been notified of the following significant shareholdings as at 5 march 2012
  number   of issued  
  of shares share capital
prudential plc group of companies  45433616  1489 
capital research and management company 19553500  641
david hood and related family trusts 16117539  520 
norges bank 15398465 505
black rock inc 15142824 496 
gartmore investment management  14931083 489
multiflight ltd  10000000  328
legal  general group plc 9960795  327 
pace plc employee benefits trust 9744470 319
 
owned and controlled by david hood
the directors present their report to shareholders on pages 11 to 21 together 
with the audited financial statements for the year ended 31 december 2011 
year prior financial period year ended 31 december 2010
front end 2011 v10indd   1213 16032012   1125 pace plc 2011 annual report    12 11    pace plc 2011 annual report
report of
the directors
principal activities
the group’s principal activities are the development design and distribution of technologies and products for 
managed subscription television telephony and broadband services and the provision of engineering design 
and software applications to its stb and gateway customers the group also provides related support services 
including systems integration and customer care centres 
business and financial results
the information that fulfils the requirements of the business review and management report including a review 
of the group’s activities developments and the financial results for the year and the key financial performance 
indicators relevant to the business of the company principally revenue gross margin  ebita profit before tax 
return on sales and net debt can be found in the chief executive officer’s review and the chief financial officer’s 
review on pages 5 to 10 the aforementioned information is incorporated in this report by reference there is no 
information which falls to be disclosed pursuant to s 417 5 of the companies act 2006 other than as noted in 
the risks and uncertainties section below
risks and uncertainties
the following are the key risks and uncertainties relevant to the business of the group
customers and markets
orders placed by the group’s paytv and telecoms customers are typically large oneoff orders for delivery over 
a number of months with supplemental orders for additional volumes as the eventual deployment of the stbs 
or gateways can be unpredictable revenues can be volatile the difficulty in predicting the group’s business flow 
and its risks can be exacerbated by a number of other factors including for example the development process 
for an advanced stb which can take over 12 months the group works on long lead times eg 4 months or 
more for component supply and manufacture typical of the industry in the us market in particular customers’ 
firm order lead times may be less than the component lead times there are third party delivery risks for example 
difficulties in the delivery of components or software code and the final order for manufacture and firm contractual 
commitment is usually dependent on product approvals and acceptance both from the operator and sometimes 
from third parties the group is also exposed to the industry wide inherent risk of supply chain failure the group 
has put in place procedures to monitor the financial and operating strength of key suppliers in addition it utilises 
dual or multi source suppliers where appropriate to mitigate this risk
product liability claims
in common with many companies in the industry the group is exposed to the risk of product liability claims made 
by customers or affected third parties should the group’s products not fulfil the terms of the contracts under which 
they are sold the group has in place quality control and other operational procedures to mitigate this risk
credit risk
the finance function of the group obtains reports from third party sources in respect of the credit worthiness of key 
customers and suppliers and sets individual credit limits as appropriate a credit insurance policy is maintained 
which provides cover over certain debtors where it is economically viable subject to excesses and the exposure to 
credit risk is monitored on an ongoing basis deposit investments are generally undertaken only in liquid securities 
and with counterparties that have appropriate credit ratings
royalties
the group’s products incorporate third party technology usually under licence inadvertent actions may expose the 
group to the risk of infringing third party intellectual property rights potential claims can be submitted many years 
after a product has been deployed
regulatory
the group is subject to a broad range of laws regulations and standards and remains exposed to changes in the 
regulatory environment including potential modifications to import duty regimes and legislation relevant to the 
group’s products and services it is pace’s policy to require that all its subsidiaries comply with applicable laws 
regulations and standards 
currency risks
the standard ‘industry currency’ is the us dollar with the majority of components and manufacturing capacity 
purchased in this currency however due to part of the group’s revenues being in sterling and euros the group is 
exposed to the risk of foreign currency movements to manage this risk the group’s treasury policy is progressively 
to cover cash flows when these are sufficiently certain and to seek price variations through contractual mechanisms 
where significant currency movements occur
financial results
the consolidated income statement for the year is set out on page 35 the profit before tax was 547m 2010 
restated 1102m and the profit before tax interest exceptional items and amortisation of other intangibles was 
1414m 2010 restated 1606m
foreign currency
during the year the board determined to change the company’s functional and group’s presentational currency to 
us dollars usd given that the significant majority of revenues and costs are generated and incurred in usd
dividend
the directors recommend the payment of a final dividend of 250c per ordinary share 2010 restated 225c to be 
paid on 4 july 2012 to shareholders on the register at the close of business on 8 june 2012 an interim dividend of 
125c per ordinary share was paid during the year 2010 restated 112c
dividends will be paid in sterling equivalent to 1575 pence per ordinary share this is based on an exchange rate 
of £  1587 being the rate applicable on 5 march 2012
share capital
details of the company’s share capital including changes for the year and the rights attaching to the ordinary 
shares are contained in note 21 and are incorporated in this report by reference
significant shareholdings 
the company has been notified of the following significant shareholdings as at 5 march 2012
  number   of issued  
  of shares share capital
prudential plc group of companies  45433616  1489 
capital research and management company 19553500  641
david hood and related family trusts 16117539  520 
norges bank 15398465 505
black rock inc 15142824 496 
gartmore investment management  14931083 489
multiflight ltd  10000000  328
legal  general group plc 9960795  327 
pace plc employee benefits trust 9744470 319
 
owned and controlled by david hood
the directors present their report to shareholders on pages 11 to 21 together 
with the audited financial statements for the year ended 31 december 2011 
year prior financial period year ended 31 december 2010
front end 2011 v10indd 1213 16032012 1125 pace plc 2011 annual report    14 13    pace plc 2011 annual report
during the year mike mctighe retired 21 june 2011 neil gaydon retired 14 december 2011 and david 
mckinney retired 6 january 2012 also held office as directors
pat chapmanpincher john grant and mike inglis will retire at the forthcoming annual general meeting of the 
company and offer themselves for reelection the board has determined that all of these directors continue to 
make a very effective contribution to the board and demonstrate a high level of commitment allan leighton mike 
pulli and roddy murray having been appointed by the board subsequent to the last annual general meeting will 
hold office until the forthcoming annual general meeting and will then offer themselves for election at that meeting 
details of the executive directors’ service contracts and the nonexecutive directors’ letters of appointment are 
disclosed in the remuneration report on page 25
payment to suppliers
it is the policy of the group to agree terms and conditions for its business transactions with suppliers which 
are varied from time to time payment is made in accordance with those terms subject to the other terms and 
conditions being met by the supplier the group does not follow any code or standard on payment practice 
creditor days at the end of the period for the group were 73 days 31 december 2010 69 days
research and development
the directors regard it as fundamental to the future success of the group to engage in a substantial ongoing 
programme of research and development of new products spending 1697m in the year 2010 restated 
1249m and charging 1606m 2010 restated 1200m to the income statement during the year following the 
treatment under ias38
donations
during the period the group donated 150746 2010 restated 84246 to charitable causes no political 
donations were made further details of the charitable and communityrelated activities of the group are given on 
page 19
corporate governance
as referred to on page 24 the company granted an appointment share award to allan leighton on his 
appointment as nonexecutive chairman save in respect of this appointment share award the directors believe 
that the company has complied throughout the period with the uk corporate governance code as revised and 
adopted by the financial reporting council the board confirms that it has established the necessary procedures 
designed to maintain a sound system of internal control and that there is an ongoing process for identifying 
evaluating and managing the significant risks faced by the company
board of directors
the group is controlled through the board of directors which comprises two executive and four nonexecutive 
directors who bring a wide range of skills and experience to the board biographical details of all directors are to 
be found on page 13 the chairman allan leighton is mainly responsible for the running of the board ensuring 
together with the company secretary that it receives timely and clear information appropriate to enable it to 
discharge its duties the responsibilities of the chief executive officer mike pulli are to focus on running the 
group’s business and implementing group strategy the chief executive officer is assisted in managing the 
business on a daytoday basis by the executive committee as further described below all the nonexecutive 
directors other than the chairman are deemed by the board to be independent and the chairman was 
independent on his appointment as required by the uk corporate governance code in addition the board has 
designated pat chapmanpincher as the senior independent director all directors have access to the advice 
and services of the company secretary and are able to take independent professional advice at the company’s 
expense in the furtherance of their duties if necessary all directors have submitted themselves for reelection at 
least once every three years and commencing this year each of them will submit themselves for reelection on an 
annual basis new directors receive a programme of tailored induction on joining the board and all directors are 
offered the opportunity to continually update their skills and knowledge by attending external training events the 
company has in place procedures to deal with directors’ conflicts of interest and the board is satisfied that these 
procedures operate effectively
directors
the names of the current directors of the company are shown below other than as described below in respect of 
allan leighton roddy murray and mike pulli all those listed held office throughout the year
allan leighton
allan was appointed a nonexecutive director in may 2011 and became chairman on 21 june 2011 he is 
currently chairman of pandora as office retail group limited and music magpiecouk previously he has held a 
wide range of public and private company roles including ceo at asda chairman of royal mail and lastminute
com and nonexecutive director of british sky broadcasting plc dyson applications and scottish power plc he is 
patron of breast cancer care and has an honorary degree from cranfield university and an honorary fellowship at 
the university of lancaster
mike pulli
mike was appointed chief executive officer on 14 december 2011 after nearly eight years as president of pace 
americas in his role as ceo mike is responsible for leading pace’s global strategy as president of pace americas 
mike was responsible for the company’s businesses in the usa canada and latin america latam prior to joining 
pace in 2004 mike was ceo of broadcasting company digital latin america dla previously mike spent eight 
years at motorola in various senior management positions including vice president of international operations and 
served in a variety of financial positions at alliedsignal inc mike holds a bachelor’s degree in accounting from 
rider university and an mba from farleigh dickinson university
roddy murray
roddy was appointed an executive director on 25 february 2012 and becomes chief financial officer today 6 
march 2012 in place of stuart hall roddy was previously cfo of the bss group plc and cfo of moss bros 
group plc prior to that he held a number of financial roles in mackays stores united distillers and british airways 
he qualified as a chartered accountant at the scottish institute before joining price waterhouse he holds a 
bachelor’s degree in administration from dundee university 
pat chapmanpincher
pat was appointed a nonexecutive director in february 2005 and became senior independent director in may 
2006 she has over 30 years’ experience in the communications industry from senior roles in multinational internet 
and telecoms companies to participating in technology company startups a founding partner and chairman of 
the cavell group which specialises in operational consultancy ip and wireless technologies she is a board advisor 
to the british standards institute and a member of the advisory board of bradford school of management
john grant
john was appointed a nonexecutive director in august 2008 john spent his executive career in a variety of 
senior international roles within the automotive industry and other engineering businesses he was chief executive 
of ascot plc between 1997 and 2000 prior to that he was group finance director of lucas industries plc 
subsequently lucas varity plc between 1992 and 1996 he previously held a number of senior positions within 
ford motor company in europe and the usa john is a nonexecutive director of melrose plc mhp sa and 
wolfson microelectronics plc
stuart hall
stuart was appointed chief financial officer and joined the board in april 2007 before joining the company he 
was group finance director of iqe plc and prior to that finance director of energis squared limited and director of 
performance management for energis group plc he has also been finance director at wbf ltd part of the adare 
printing group plc carnography plc and race electronics he qualified as a chartered accountant with bdo 
binder hamlyn stuart hall ceases to hold office as a director and chief financial officer on 6 march 2012
mike inglis
mike was appointed a nonexecutive director in july 2008 he is currently executive vice president and general 
manager of the processor division of arm holdings having previously been evp  sales and marketing before 
joining arm he worked in management consultancy with at kearney and held a number of senior operational 
and marketing positions at motorola he previously worked in semiconductor sales marketing design and 
consultancy with texas instruments fairchild and bis macintosh and gained his initial industrial experience with 
gec telecommunications he is a chartered engineer and a member of the chartered institute of marketing
report of
the directors continued
front end 2011 v10indd   1415 16032012   1125 pace plc 2011 annual report    14 13    pace plc 2011 annual report
during the year mike mctighe retired 21 june 2011 neil gaydon retired 14 december 2011 and david 
mckinney retired 6 january 2012 also held office as directors
pat chapmanpincher john grant and mike inglis will retire at the forthcoming annual general meeting of the 
company and offer themselves for reelection the board has determined that all of these directors continue to 
make a very effective contribution to the board and demonstrate a high level of commitment allan leighton mike 
pulli and roddy murray having been appointed by the board subsequent to the last annual general meeting will 
hold office until the forthcoming annual general meeting and will then offer themselves for election at that meeting 
details of the executive directors’ service contracts and the nonexecutive directors’ letters of appointment are 
disclosed in the remuneration report on page 25
payment to suppliers
it is the policy of the group to agree terms and conditions for its business transactions with suppliers which 
are varied from time to time payment is made in accordance with those terms subject to the other terms and 
conditions being met by the supplier the group does not follow any code or standard on payment practice 
creditor days at the end of the period for the group were 73 days 31 december 2010 69 days
research and development
the directors regard it as fundamental to the future success of the group to engage in a substantial ongoing 
programme of research and development of new products spending 1697m in the year 2010 restated 
1249m and charging 1606m 2010 restated 1200m to the income statement during the year following the 
treatment under ias38
donations
during the period the group donated 150746 2010 restated 84246 to charitable causes no political 
donations were made further details of the charitable and communityrelated activities of the group are given on 
page 19
corporate governance
as referred to on page 24 the company granted an appointment share award to allan leighton on his 
appointment as nonexecutive chairman save in respect of this appointment share award the directors believe 
that the company has complied throughout the period with the uk corporate governance code as revised and 
adopted by the financial reporting council the board confirms that it has established the necessary procedures 
designed to maintain a sound system of internal control and that there is an ongoing process for identifying 
evaluating and managing the significant risks faced by the company
board of directors
the group is controlled through the board of directors which comprises two executive and four nonexecutive 
directors who bring a wide range of skills and experience to the board biographical details of all directors are to 
be found on page 13 the chairman allan leighton is mainly responsible for the running of the board ensuring 
together with the company secretary that it receives timely and clear information appropriate to enable it to 
discharge its duties the responsibilities of the chief executive officer mike pulli are to focus on running the 
group’s business and implementing group strategy the chief executive officer is assisted in managing the 
business on a daytoday basis by the executive committee as further described below all the nonexecutive 
directors other than the chairman are deemed by the board to be independent and the chairman was 
independent on his appointment as required by the uk corporate governance code in addition the board has 
designated pat chapmanpincher as the senior independent director all directors have access to the advice 
and services of the company secretary and are able to take independent professional advice at the company’s 
expense in the furtherance of their duties if necessary all directors have submitted themselves for reelection at 
least once every three years and commencing this year each of them will submit themselves for reelection on an 
annual basis new directors receive a programme of tailored induction on joining the board and all directors are 
offered the opportunity to continually update their skills and knowledge by attending external training events the 
company has in place procedures to deal with directors’ conflicts of interest and the board is satisfied that these 
procedures operate effectively
directors
the names of the current directors of the company are shown below other than as described below in respect of 
allan leighton roddy murray and mike pulli all those listed held office throughout the year
allan leighton
allan was appointed a nonexecutive director in may 2011 and became chairman on 21 june 2011 he is 
currently chairman of pandora as office retail group limited and music magpiecouk previously he has held a 
wide range of public and private company roles including ceo at asda chairman of royal mail and lastminute
com and nonexecutive director of british sky broadcasting plc dyson applications and scottish power plc he is 
patron of breast cancer care and has an honorary degree from cranfield university and an honorary fellowship at 
the university of lancaster
mike pulli
mike was appointed chief executive officer on 14 december 2011 after nearly eight years as president of pace 
americas in his role as ceo mike is responsible for leading pace’s global strategy as president of pace americas 
mike was responsible for the company’s businesses in the usa canada and latin america latam prior to joining 
pace in 2004 mike was ceo of broadcasting company digital latin america dla previously mike spent eight 
years at motorola in various senior management positions including vice president of international operations and 
served in a variety of financial positions at alliedsignal inc mike holds a bachelor’s degree in accounting from 
rider university and an mba from farleigh dickinson university
roddy murray
roddy was appointed an executive director on 25 february 2012 and becomes chief financial officer today 6 
march 2012 in place of stuart hall roddy was previously cfo of the bss group plc and cfo of moss bros 
group plc prior to that he held a number of financial roles in mackays stores united distillers and british airways 
he qualified as a chartered accountant at the scottish institute before joining price waterhouse he holds a 
bachelor’s degree in administration from dundee university 
pat chapmanpincher
pat was appointed a nonexecutive director in february 2005 and became senior independent director in may 
2006 she has over 30 years’ experience in the communications industry from senior roles in multinational internet 
and telecoms companies to participating in technology company startups a founding partner and chairman of 
the cavell group which specialises in operational consultancy ip and wireless technologies she is a board advisor 
to the british standards institute and a member of the advisory board of bradford school of management
john grant
john was appointed a nonexecutive director in august 2008 john spent his executive career in a variety of 
senior international roles within the automotive industry and other engineering businesses he was chief executive 
of ascot plc between 1997 and 2000 prior to that he was group finance director of lucas industries plc 
subsequently lucas varity plc between 1992 and 1996 he previously held a number of senior positions within 
ford motor company in europe and the usa john is a nonexecutive director of melrose plc mhp sa and 
wolfson microelectronics plc
stuart hall
stuart was appointed chief financial officer and joined the board in april 2007 before joining the company he 
was group finance director of iqe plc and prior to that finance director of energis squared limited and director of 
performance management for energis group plc he has also been finance director at wbf ltd part of the adare 
printing group plc carnography plc and race electronics he qualified as a chartered accountant with bdo 
binder hamlyn stuart hall ceases to hold office as a director and chief financial officer on 6 march 2012
mike inglis
mike was appointed a nonexecutive director in july 2008 he is currently executive vice president and general 
manager of the processor division of arm holdings having previously been evp  sales and marketing before 
joining arm he worked in management consultancy with at kearney and held a number of senior operational 
and marketing positions at motorola he previously worked in semiconductor sales marketing design and 
consultancy with texas instruments fairchild and bis macintosh and gained his initial industrial experience with 
gec telecommunications he is a chartered engineer and a member of the chartered institute of marketing
report of
the directors continued
front end 2011 v10indd 1415 16032012 1125 pace plc 2011 annual report    16 15    pace plc 2011 annual report
the board has a formal schedule of matters specifically reserved to it and normally meets at least eight times 
each year it is responsible for overall group strategy acquisition and divestment policy approval of major capital 
expenditure projects and consideration of significant financing matters it reviews the strategic direction of the 
group and conducts formal strategy reviews together with other senior executives within the group at least once 
a year the chairman holds meetings with the nonexecutive directors without the executive directors being 
present at least twice during the year it is the policy of the board to undertake a formal review and evaluation of 
its performance including the performance of its committees the chairman and individual directors on an annual 
basis this is generally concluded by written feedback in standardised form from each director to the chairman or 
the senior independent director in the case of appraisal of the chairman the board will consider appointing an 
independent facilitator for the evaluation process at least once every three years and last did so in 2009 with the 
review concluding in 2010
board committees
the board has established the following committees each of which has written terms of reference specifying its 
authority and duties and copies of which are publicly available on the company’s website wwwpacecom
the audit  risk committee is comprised of independent designated nonexecutive directors pat chapman
pincher mike inglis and john grant who is the chairman of the committee john grant was previously group 
finance director of a listed business and is considered by the board to have the necessary recent and relevant 
financial experience for his role as chairman details of the role and of the primary responsibilities of the audit  
risk committee are explained on page 16 
the executive committee is chaired by mike pulli as chief executive officer the committee generally meets 
once a month and ensures that the strategy plans and policies previously agreed or delegated by the board are 
implemented
the executive committee comprises the executive directors together with the following senior executives
anthony dixon general counsel
jill ezard director of human resources
mark loughran president pace europe and pace enterprise
tim o’loughlin president pace americas
scott sheldon chief strategy officer
the remuneration committee is comprised of allan leighton and independent designated nonexecutive 
directors john grant and pat chapmanpincher who is the chairman of the committee the committee is 
responsible for setting the remuneration of the executive directors and other members of the executive committee 
including making recommendations regarding the grant of share incentive awards the members of the committee 
have no personal interest other than as shareholders in the matters to be decided no potential conflicts of interest 
arising from crossdirectorships and no daytoday involvement in the running of the business
the nominations committee is comprised of nonexecutive directors pat chapmanpincher john grant mike 
inglis and is chaired by allan leighton its principal purpose is to consider and make recommendations to the 
board regarding the appointment of new directors the nominations committee meets at least once a year or as 
required external search consultants were appointed by the committee in connection with the appointment of 
allan leighton and roddy murray
board and committee meetings attendance
 board audit  risk remuneration nominations 
  committee committee committee
total meetings 12 3 2 1 
allan leighton 7  1 1
david mckinney 12   
john grant 12 3 2 1
mike inglis 11 2 2 1
mike mctighe 6  1 
mike pulli    
neil gaydon 11   
pat chapmanpincher 12 3 2 1 
stuart hall 12   
 there were no meetings held after mike pulli’s appointment on 14 december 2011
 appointed 31 may and attended all meetings since appointment
directors’ remuneration
the remuneration committee reviews the performance of the executive directors and other members of the 
executive committee as a prelude to recommending their annual remuneration bonus awards and award of share 
options to the board the final determinations are made by the board as a whole but no director plays a part in any 
discussions concerning their own remuneration there are no agreements between the company and its directors 
or employees providing for compensation for loss of office or employment whether through resignation purported 
redundancy or otherwise that occurs as a result of a takeover bid
the remuneration report of the directors to shareholders is set out on pages 22 to 30 and includes the 
remuneration policy of the company and details of directors’ incentive payments and the related performance 
criteria
authority to purchase own shares
at the annual general meeting in 2011 the company was authorised by shareholders to purchase up to 
45681000 of its own ordinary shares representing 15 per cent of its issued share capital as at march 2011 the 
company did not utilise this authority during the year the authority for the company to purchase its own shares 
expires at the conclusion of the annual general meeting in 2012 and a resolution to renew it will be proposed at 
that meeting
accountability and audit
a detailed review of the performance of the group’s business is contained in the chief executive officer’s review 
and the chief financial officer’s review these statements together with the letter from the chairman and the 
report of the directors are intended to present a balanced assessment of the group’s position and prospects the 
directors’ responsibility for the financial statements is described on page 31 and the responsibilities of the auditors 
are described on page 32
audit  risk committee
during the year the committee undertook the annual review of its terms of reference the review focused primarily 
on extending the committee’s role in relation to assurance and oversight of risk management within the group 
following this review the committee was renamed the audit  risk committee to emphasise its strengthened role 
in relation to risk
the audit  risk committee is responsible for
•	 monitoring	the	integrity	of	the	financial	statements	of	the	company	and	formal	announcements	r elating	to	the		
 company’s financial performance and reviewing any significant financial reporting judgements contained therein
•	 reviewing	the	company’ s	inter nal	financial	and	operational	contr ol	and	risk	management	systems
•	 monitoring	the	ef fectiveness	of	the	company’ s	inter nal	audit	function	and	r eviewing	its	material	findings
•	 	 reviewing	accounting	policies	accounting	tr eatments	and	disclosur es	in	the	financial	statements	to	ensur e	
clarity and completeness
•	 	 overseeing	the	company’ s	r elationship	with	its	exter nal	auditors	including	making	r ecommendations	as	to	the	
appointment or reappointment of the external auditors reviewing their terms of engagement and monitoring 
their independence and ensuring that policy surrounding their engagement to provide nonaudit services is 
appropriately applied and
•	 reviewing	the	ef fectiveness	of	the	company’ s	whistleblowing	pr ocedur es
internal audit
the company’s head of risk assurance damien wilkinson who has direct access to the audit  risk committee 
primarily through the chairman of the committee manages an internal audit function provided by external qualified 
auditing professionals
the audit  risk committee reviews annually the arrangements for internal audit and during the year the 
committee reappointed bdo llp bdo to act as internal auditors performing an agreed programme of internal 
audits in collaboration with the company’s head of risk assurance and management bdo attended and 
presented their reports to each of the audit  risk committee meetings during the year
report of
the directors continued
front end 2011 v10indd   1617 16032012   1125 pace plc 2011 annual report    16 15    pace plc 2011 annual report
the board has a formal schedule of matters specifically reserved to it and normally meets at least eight times 
each year it is responsible for overall group strategy acquisition and divestment policy approval of major capital 
expenditure projects and consideration of significant financing matters it reviews the strategic direction of the 
group and conducts formal strategy reviews together with other senior executives within the group at least once 
a year the chairman holds meetings with the nonexecutive directors without the executive directors being 
present at least twice during the year it is the policy of the board to undertake a formal review and evaluation of 
its performance including the performance of its committees the chairman and individual directors on an annual 
basis this is generally concluded by written feedback in standardised form from each director to the chairman or 
the senior independent director in the case of appraisal of the chairman the board will consider appointing an 
independent facilitator for the evaluation process at least once every three years and last did so in 2009 with the 
review concluding in 2010
board committees
the board has established the following committees each of which has written terms of reference specifying its 
authority and duties and copies of which are publicly available on the company’s website wwwpacecom
the audit  risk committee is comprised of independent designated nonexecutive directors pat chapman
pincher mike inglis and john grant who is the chairman of the committee john grant was previously group 
finance director of a listed business and is considered by the board to have the necessary recent and relevant 
financial experience for his role as chairman details of the role and of the primary responsibilities of the audit  
risk committee are explained on page 16 
the executive committee is chaired by mike pulli as chief executive officer the committee generally meets 
once a month and ensures that the strategy plans and policies previously agreed or delegated by the board are 
implemented
the executive committee comprises the executive directors together with the following senior executives
anthony dixon general counsel
jill ezard director of human resources
mark loughran president pace europe and pace enterprise
tim o’loughlin president pace americas
scott sheldon chief strategy officer
the remuneration committee is comprised of allan leighton and independent designated nonexecutive 
directors john grant and pat chapmanpincher who is the chairman of the committee the committee is 
responsible for setting the remuneration of the executive directors and other members of the executive committee 
including making recommendations regarding the grant of share incentive awards the members of the committee 
have no personal interest other than as shareholders in the matters to be decided no potential conflicts of interest 
arising from crossdirectorships and no daytoday involvement in the running of the business
the nominations committee is comprised of nonexecutive directors pat chapmanpincher john grant mike 
inglis and is chaired by allan leighton its principal purpose is to consider and make recommendations to the 
board regarding the appointment of new directors the nominations committee meets at least once a year or as 
required external search consultants were appointed by the committee in connection with the appointment of 
allan leighton and roddy murray
board and committee meetings attendance
 board audit  risk remuneration nominations 
  committee committee committee
total meetings 12 3 2 1 
allan leighton 7  1 1
david mckinney 12   
john grant 12 3 2 1
mike inglis 11 2 2 1
mike mctighe 6  1 
mike pulli    
neil gaydon 11   
pat chapmanpincher 12 3 2 1 
stuart hall 12   
 there were no meetings held after mike pulli’s appointment on 14 december 2011
 appointed 31 may and attended all meetings since appointment
directors’ remuneration
the remuneration committee reviews the performance of the executive directors and other members of the 
executive committee as a prelude to recommending their annual remuneration bonus awards and award of share 
options to the board the final determinations are made by the board as a whole but no director plays a part in any 
discussions concerning their own remuneration there are no agreements between the company and its directors 
or employees providing for compensation for loss of office or employment whether through resignation purported 
redundancy or otherwise that occurs as a result of a takeover bid
the remuneration report of the directors to shareholders is set out on pages 22 to 30 and includes the 
remuneration policy of the company and details of directors’ incentive payments and the related performance 
criteria
authority to purchase own shares
at the annual general meeting in 2011 the company was authorised by shareholders to purchase up to 
45681000 of its own ordinary shares representing 15 per cent of its issued share capital as at march 2011 the 
company did not utilise this authority during the year the authority for the company to purchase its own shares 
expires at the conclusion of the annual general meeting in 2012 and a resolution to renew it will be proposed at 
that meeting
accountability and audit
a detailed review of the performance of the group’s business is contained in the chief executive officer’s review 
and the chief financial officer’s review these statements together with the letter from the chairman and the 
report of the directors are intended to present a balanced assessment of the group’s position and prospects the 
directors’ responsibility for the financial statements is described on page 31 and the responsibilities of the auditors 
are described on page 32
audit  risk committee
during the year the committee undertook the annual review of its terms of reference the review focused primarily 
on extending the committee’s role in relation to assurance and oversight of risk management within the group 
following this review the committee was renamed the audit  risk committee to emphasise its strengthened role 
in relation to risk
the audit  risk committee is responsible for
•	 monitoring	the	integrity	of	the	financial	statements	of	the	company	and	formal	announcements	r elating	to	the		
 company’s financial performance and reviewing any significant financial reporting judgements contained therein
•	 reviewing	the	company’ s	inter nal	financial	and	operational	contr ol	and	risk	management	systems
•	 monitoring	the	ef fectiveness 	of	the	company’ s	inter nal	audit	function	and	r eviewing	its	material	findings
•	 	 reviewing	accounting	policies	accounting	tr eatments	and	disclosur es	in	the	financial	statements	to	ensur e	
clarity and completeness
•	 	 overseeing	the	company’ s	r elationship	with	its	exter nal	auditors	including	making	r ecommendations	as	to	the	
appointment or reappointment of the external auditors reviewing their terms of engagement and monitoring 
their independence and ensuring that policy surrounding their engagement to provide nonaudit services is 
appropriately applied and
•	 reviewing	the	ef fectiveness	of	the	company’ s	whistleblowing	pr ocedur es
internal audit
the company’s head of risk assurance damien wilkinson who has direct access to the audit  risk committee 
primarily through the chairman of the committee manages an internal audit function provided by external qualified 
auditing professionals
the audit  risk committee reviews annually the arrangements for internal audit and during the year the 
committee reappointed bdo llp bdo to act as internal auditors performing an agreed programme of internal 
audits in collaboration with the company’s head of risk assurance and management bdo attended and 
presented their reports to each of the audit  risk committee meetings during the year
report of
the directors continued
front end 2011 v10indd 1617 16032012 1125 pace plc 2011 annual report    18 17    pace plc 2011 annual report
the committee has amongst other things considered the quality of reporting to the committee and impartiality of 
the internal auditors and has concluded that the effectiveness of internal audit during the year was satisfactory
external audit
the audit  risk committee has satisfied itself that the external auditor kpmg audit plc kpmg acted 
independent of the group previous appointments of kpmg and the extent of other work undertaken by it were 
considered interalia in this regard
it is the audit  risk committee’s opinion that there were no limitations imposed by management on kpmg whilst 
performing their duties during the review period
the audit  risk committee in consultation with the group’s executive management agreed to the terms of the 
kpmg engagement letter audit plan and budgeted audit fees for the 2011 financial year
a formal framework governs the process through which the group’s auditor is considered to render nonaudit 
services the audit  risk committee has approved a policy in relation to the provision of nonaudit services by the 
external auditor and the nature and extent of nonaudit services that the external auditor could provide within the 
scope of the policy during the financial year
it was the audit  risk committee’s recommendation that kpmg defer the rotation of engagement partner by 
one year in order to ensure that the acquisition and integration work in respect of previous year acquisitions was 
appropriately seen through to completion the audit  risk committee note the involvement of an additional 
partner in the 2011 audit and confirms its opinion that this constituted both a benefit to audit quality and an 
appropriate safeguard against the perceived independence risk which could have arisen from the engagement 
partner chris hearld signing a sixth audit opinion
internal controls
overall responsibility for the group’s system of internal control rests with the board the board has delegated 
certain of its powers to the audit  risk committee to review the effectiveness of the systems of control and to 
receive reports from the auditors internal and external and from the management relating to the interim and annual 
accounts and the control systems in use throughout the group
during the year and up to the date of this report the board carried out reviews of the effectiveness of the group’s 
internal controls the reviews were undertaken in accordance with the financial reporting council’s guidance 
under the following headings and were aimed at clearly identifying the systems already in place and the action 
plans necessary to improve areas of control weakness
the control environment
subject to those powers and limits of authority reserved by the board and to the group policies and guidelines 
they have established the conduct of the business of the group is delegated within a clearly defined organisational 
structure and approved level of authority the board has also adopted a code of business ethics which has been 
incorporated into the employee handbook issued to all employees
risk assessment
the directors and senior managers are responsible for identifying and monitoring sources of potential business risk 
and financial risk and for taking such preventative and protective actions as they consider necessary to manage 
such risks effectively during the year a risk assessment review of the group’s business has been conducted by 
the head of risk assurance and bdo acting as internal auditors in conjunction with members of the executive 
committee the board has received and considered this review as part of an annual risk and control assessment
the group’s systems are designed to identify and manage rather than eliminate significant business risks 
including the risk of failure to achieve business objectives but can provide only reasonable not absolute assurance 
against material misstatement or loss business risks are identified evaluated and managed through functional line 
management reporting to divisional meetings executive committee meetings and board meetings as appropriate 
each member of the executive committee is required to highlight and report on any significant business risks 
identified within their sphere of responsibility
the key business risks associated with the timely completion of longterm development projects and ongoing 
business risks including alleged infringement of third party intellectual property rights and supply chain interruption 
are managed by crossfunctional teams of senior employees business continuity plans addressing physical risks to 
the group’s development sites and maintenance of it services are maintained the group has adopted customer 
account teams cats grouped within sbus so as to focus the business on customer needs the senior managers 
within the cats also monitor the financial and business risks including competitor risks associated with the 
delivery of agreed plans reviewing such matters at business review meetings held on a regular basis and attended 
by members of the executive committee during the year particular focus of these risk management systems was 
required in respect of the consequences of the japanese tsunami and floods in thailand
financial control and information systems
the group’s strategic direction is reviewed regularly by the board and plans budgets and performance targets are 
reviewed and approved at least annually directors receive monthly summaries of financial results which compare 
actual performance with targets together with detailed management reports that identify the reasons for variances 
and the progress achieved business planning documents are revised on a regular basis in line with actual and 
expected performance a review of the consolidated financial statements is completed by the centralised group 
finance function to ensure that the financial position and results of the group are appropriately reflected in the 
consolidated accounts
control procedures
financial control procedures have been developed for all of the main business functions and in relation to the 
company’s financial reporting process and the group’s process for the preparation of consolidated accounts and 
have been documented in a procedures manual authorisation limits for purchases and capital expenditure are 
specified and procedures are in place for minimising exposure to potential weaknesses in the receipt handling and 
despatch of goods the group’s main premises have received accreditation for bsi iso 9001 2000
monitoring systems
monitoring of the internal control systems is carried out by head of risk assurance in conjunction with the internal 
auditors bdo
although no system of internal financial control can provide absolute assurance against material misstatement 
or loss the group’s systems are designed to provide the directors with reasonable assurance that transactions 
are authorised and completely and accurately recorded that assets are safeguarded and that material errors 
irregularities and actions contrary to group policies and directions are either prevented or promptly discovered
going concern
the group has borrowing facilities in place until march 2014 at 31 december 2011 these are in the form of 
a 225m term loan which is subject to repayment through instalments of 375m each due every six months 
plus a final bullet payment of 75m and a 150m revolver credit facility these facilities are subject to financial 
performance covenants which the group currently complies with
the board’s assessment of the group and company’s ability to continue as a going concern has taken into 
account the effect of the current economic climate current market position and the level of borrowings in the year 
the principal risks that the group is challenged with have been set out in the risks and uncertainties section of this 
report along with how the directors intend to mitigate those risks
the board has prepared a financial and working capital forecast upon trading assumptions and other medium term 
plans and has concluded that the group will continue to meet its financial performance covenants and will have 
adequate working capital available to continue in operational existence for the foreseeable future
corporate social responsibility
employment policies
the directors recognise the importance of the group’s employees to its success and future development and are 
committed to providing an environment that will attract motivate and reward high quality employees the group 
continues to invest in a range of internal and external initiatives to promote employee development
report of
the directors continued
front end 2011 v10indd   1819 16032012   1125 pace plc 2011 annual report    18 17    pace plc 2011 annual report
the committee has amongst other things considered the quality of reporting to the committee and impartiality of 
the internal auditors and has concluded that the effectiveness of internal audit during the year was satisfactory
external audit
the audit  risk committee has satisfied itself that the external auditor kpmg audit plc kpmg acted 
independent of the group previous appointments of kpmg and the extent of other work undertaken by it were 
considered interalia in this regard
it is the audit  risk committee’s opinion that there were no limitations imposed by management on kpmg whilst 
performing their duties during the review period
the audit  risk committee in consultation with the group’s executive management agreed to the terms of the 
kpmg engagement letter audit plan and budgeted audit fees for the 2011 financial year
a formal framework governs the process through which the group’s auditor is considered to render nonaudit 
services the audit  risk committee has approved a policy in relation to the provision of nonaudit services by the 
external auditor and the nature and extent of nonaudit services that the external auditor could provide within the 
scope of the policy during the financial year
it was the audit  risk committee’s recommendation that kpmg defer the rotation of engagement partner by 
one year in order to ensure that the acquisition and integration work in respect of previous year acquisitions was 
appropriately seen through to completion the audit  risk committee note the involvement of an additional 
partner in the 2011 audit and confirms its opinion that this constituted both a benefit to audit quality and an 
appropriate safeguard against the perceived independence risk which could have arisen from the engagement 
partner chris hearld signing a sixth audit opinion
internal controls
overall responsibility for the group’s system of internal control rests with the board the board has delegated 
certain of its powers to the audit  risk committee to review the effectiveness of the systems of control and to 
receive reports from the auditors internal and external and from the management relating to the interim and annual 
accounts and the control systems in use throughout the group
during the year and up to the date of this report the board carried out reviews of the effectiveness of the group’s 
internal controls the reviews were undertaken in accordance with the financial reporting council’s guidance 
under the following headings and were aimed at clearly identifying the systems already in place and the action 
plans necessary to improve areas of control weakness
the control environment
subject to those powers and limits of authority reserved by the board and to the group policies and guidelines 
they have established the conduct of the business of the group is delegated within a clearly defined organisational 
structure and approved level of authority the board has also adopted a code of business ethics which has been 
incorporated into the employee handbook issued to all employees
risk assessment
the directors and senior managers are responsible for identifying and monitoring sources of potential business risk 
and financial risk and for taking such preventative and protective actions as they consider necessary to manage 
such risks effectively during the year a risk assessment review of the group’s business has been conducted by 
the head of risk assurance and bdo acting as internal auditors in conjunction with members of the executive 
committee the board has received and considered this review as part of an annual risk and control assessment
the group’s systems are designed to identify and manage rather than eliminate significant business risks 
including the risk of failure to achieve business objectives but can provide only reasonable not absolute assurance 
against material misstatement or loss business risks are identified evaluated and managed through functional line 
management reporting to divisional meetings executive committee meetings and board meetings as appropriate 
each member of the executive committee is required to highlight and report on any significant business risks 
identified within their sphere of responsibility
the key business risks associated with the timely completion of longterm development projects and ongoing 
business risks including alleged infringement of third party intellectual property rights and supply chain interruption 
are managed by crossfunctional teams of senior employees business continuity plans addressing physical risks to 
the group’s development sites and maintenance of it services are maintained the group has adopted customer 
account teams cats grouped within sbus so as to focus the business on customer needs the senior managers 
within the cats also monitor the financial and business risks including competitor risks associated with the 
delivery of agreed plans reviewing such matters at business review meetings held on a regular basis and attended 
by members of the executive committee during the year particular focus of these risk management systems was 
required in respect of the consequences of the japanese tsunami and floods in thailand
financial control and information systems
the group’s strategic direction is reviewed regularly by the board and plans budgets and performance targets are 
reviewed and approved at least annually directors receive monthly summaries of financial results which compare 
actual performance with targets together with detailed management reports that identify the reasons for variances 
and the progress achieved business planning documents are revised on a regular basis in line with actual and 
expected performance a review of the consolidated financial statements is completed by the centralised group 
finance function to ensure that the financial position and results of the group are appropriately reflected in the 
consolidated accounts
control procedures
financial control procedures have been developed for all of the main business functions and in relation to the 
company’s financial reporting process and the group’s process for the preparation of consolidated accounts and 
have been documented in a procedures manual authorisation limits for purchases and capital expenditure are 
specified and procedures are in place for minimising exposure to potential weaknesses in the receipt handling and 
despatch of goods the group’s main premises have received accreditation for bsi iso 9001 2000
monitoring systems
monitoring of the internal control systems is carried out by head of risk assurance in conjunction with the internal 
auditors bdo
although no system of internal financial control can provide absolute assurance against material misstatement 
or loss the group’s systems are designed to provide the directors with reasonable assurance that transactions 
are authorised and completely and accurately recorded that assets are safeguarded and that material errors 
irregularities and actions contrary to group policies and directions are either prevented or promptly discovered
going concern
the group has borrowing facilities in place until march 2014 at 31 december 2011 these are in the form of 
a 225m term loan which is subject to repayment through instalments of 375m each due every six months 
plus a final bullet payment of 75m and a 150m revolver credit facility these facilities are subject to financial 
performance covenants which the group currently complies with
the board’s assessment of the group and company’s ability to continue as a going concern has taken into 
account the effect of the current economic climate current market position and the level of borrowings in the year 
the principal risks that the group is challenged with have been set out in the risks and uncertainties section of this 
report along with how the directors intend to mitigate those risks
the board has prepared a financial and working capital forecast upon trading assumptions and other medium term 
plans and has concluded that the group will continue to meet its financial performance covenants and will have 
adequate working capital available to continue in operational existence for the foreseeable future
corporate social responsibility
employment policies
the directors recognise the importance of the group’s employees to its success and future development and are 
committed to providing an environment that will attract motivate and reward high quality employees the group 
continues to invest in a range of internal and external initiatives to promote employee development
report of
the directors continued
front end 2011 v10indd 1819 16032012 1125 employees are kept informed of matters affecting them as employees and factors affecting the performance of the 
group through regular employee meetingsbriefings and a company newsletter
the group welcomes applications for employment from all sectors of the community and promotes equality of 
opportunity in employment regardless of age sex sexual orientation disability or ethnic origin it is the group’s 
policy that training career development and promotion opportunities should be available to all employees in 
the event that an employee becomes disabled the group makes reasonable adjustments where any aspect of 
premises or working practices puts such a disabled employee at a substantial disadvantage compared with a non
disabled employee
health and safety
each sbu in the group has an established health and safety committee made up of health and safety 
representatives the designated health and safety officer and other persons with expert knowledge who review 
health and safety issues relevant to the group’s business other safetyrelated committees also conduct periodic 
reviews of specific work practices these actions complement the uk government’s “health work wellbeing” 
hww initiative which has been adopted and implemented by the company
part of the hww incorporates return to work programmes and the group’s operations in saltaire and americas 
west and americas east have adopted similar policies each division incorporates where appropriate their 
ergonomic risk assessments the group’s businesses in india the uk americas west and americas east provide 
training for first aid fire evacuation and fire wardens americas west undertakes earthquake training and 
americas east undertakes hurricane training all of these initiatives are backed up by appropriate risk assessments 
“toolbox talks” short presentations on specific aspects of health and safety are also published on the group’s 
intranet and shared between different parts of the group
the number of workplace accidents during the year for saltaire was 4 outside the uk there were 14 accidents 
in the americas west and americas east operations and none in india none of these accidents was regarded 
by the relevant local health and safety committee as serious a report concerning health and safety aspects of 
the group’s business and copies of specific group safety policy documents can be obtained from the company 
secretary
charitable and community support
the group has an established charitable donations committee comprising employees based at the group’s 
premises in the uk and the usa the committee considers all requests for charitable and community project 
assistance from employees and external charities within a financial budget and criteria approved by the board on 
an annual basis
the group’s support through the committee is focused on the local geographical area of pace’s premises in 
the uk france india and the usa as well as the charitable and community initiatives of group employees the 
corporate charity policy focus is to support local charities of benefit to the local area and people living close to each 
group site
during the year a number of requests for support were considered by the committee of which 107 satisfied the 
criteria and received financial support amounting to 106675 in total the participation of employees of the group 
in community and charitable activities outside work hours has been encouraged by the provision of funds to match 
individual sponsorship raised donations amounting to 44071 were made to local charitable causes pursuant to 
the ceo’s discretion or prior board approval
pace has continued as lead sponsor of the leeds ahead education strand of business engagement in the uk’s 
west yorkshire region following its acceptance of this role for a two year period in 2010 this has enabled leeds 
ahead to develop and rollout their make the grade business education partnership model in the west yorkshire 
region 
in addition pace has partnered with teach first to support the science technology engineering and maths 
stem teachers in yorkshire and the humber pace will fund the provision of personal development coaches to 
teach first participants in their second year of teaching teach first recruits trains and supports teachers working 
in schools in low income communities to raise the achievement aspirations and access to opportunity of children 
from low socioeconomic backgrounds
supply chain
pace is a member of the electronic industry citizen coalition eicc and applies to the eicc code of conduct in 
its business a programme of assessment and auditing is maintained at the regular business review meetings held 
with the group’s principal suppliers during the year two members of the pace quality team undertook training and 
were certified as eiccgesi labour and ethics lead auditors
accreditation
pace is a member of business in the community bitc which operates in the uk and internationally through a 
network of partners worldwide membership allows pace to further develop and promote responsibility in business 
through access to the expertise and experience of the bitc team and their membership base
in the second half of the year the company participated in the bitc cr index the bitc cr index is an 
internationally recognised index of how effectively businesses identify address and integrates the management of 
their environmental and social impacts participation provides the group with a benchmark and gap analysis with 
best practice we are pleased to report that we achieved a silver ranking for our csr programme
environmental management
during the year the company set environmental targets and achieved the following outcomes in respect of its 
chosen measures of environmental impact
start date end date objective target status
2011 dec 11 drive a reduction in the overall 
environmental emissions associated with 
paces site operations
achieve a 5 reduction in overall co
2
 
intensity scope 1 2 and 3 by 2011  
scope 3 emissions as defined in 2010
not achieved 
2011 dec 11 drive innovation on the reduction of the 
environmental impact of pace products
seek to reduce average  stb co
2
 
emissions by 5 
target achieved 
total reduction 
88
seek to ensure that 90 of the hardware 
design of  pace  stbs  will comply with or 
exceed the eu code of conduct energy 
star and meps guidelines as appropriate 
target achieved 
100 hw 
designs comply
all stbs designed in 2011 to exceed a 
score of 80 during pace’s design for 
environmentdfe programme
target achieved 
average score 
86
2011 dec 12 drive a reduction in the environmental 
impact of pace’s stb manufacture
measure the co
2
 emission associated 
with the production of stbs pace scope 
3 manufacturing partners emissions
on target
2011 dec 11 commitment to offset investigate and develop an offsetting 
strategy appropriate to pace 
complete 
and not being 
progressed
2011 dec 12 align recent acquisitions with pace’s 
environmental principles and direction
increase pace’s 14001 footprint to include 
pace americas west and brazil  by 2012 
on target
the company has maintained certification to the international management standard iso 14001 at its saltaire 
florida bangalore and paris sites and for the first time achieved certification at the tempe and san antonio sites 
the group environmental policy has been applied to all pace sites worldwide
the company is a signatory to the european code of conduct on energy efficiency of digital tv service systems 
eu code of conduct energy star program requirements for stbs and meps minimum energy performance 
standard pace is committed to ensure that all products are designed to minimise energy consumption through its 
‘design for environment’ programme
  this year we have included information and data from our manufacturing facility in manaus brazil and the three facilities of pace west located in san jose san antonio and tempe formerly 2wire the usbased business we acquired in 2010 this has had the effect of 
increasing our absolute and normalised carbon emissions
pace plc 2011 annual report    20 19    pace plc 2011 annual report
report of
the directors continued
front end 2011 v10indd   2021 16032012   1125 employees are kept informed of matters affecting them as employees and factors affecting the performance of the 
group through regular employee meetingsbriefings and a company newsletter
the group welcomes applications for employment from all sectors of the community and promotes equality of 
opportunity in employment regardless of age sex sexual orientation disability or ethnic origin it is the group’s 
policy that training career development and promotion opportunities should be available to all employees in 
the event that an employee becomes disabled the group makes reasonable adjustments where any aspect of 
premises or working practices puts such a disabled employee at a substantial disadvantage compared with a non
disabled employee
health and safety
each sbu in the group has an established health and safety committee made up of health and safety 
representatives the designated health and safety officer and other persons with expert knowledge who review 
health and safety issues relevant to the group’s business other safetyrelated committees also conduct periodic 
reviews of specific work practices these actions complement the uk government’s “health work wellbeing” 
hww initiative which has been adopted and implemented by the company
part of the hww incorporates return to work programmes and the group’s operations in saltaire and americas 
west and americas east have adopted similar policies each division incorporates where appropriate their 
ergonomic risk assessments the group’s businesses in india the uk americas west and americas east provide 
training for first aid fire evacuation and fire wardens americas west undertakes earthquake training and 
americas east undertakes hurricane training all of these initiatives are backed up by appropriate risk assessments 
“toolbox talks” short presentations on specific aspects of health and safety are also published on the group’s 
intranet and shared between different parts of the group
the number of workplace accidents during the year for saltaire was 4 outside the uk there were 14 accidents 
in the americas west and americas east operations and none in india none of these accidents was regarded 
by the relevant local health and safety committee as serious a report concerning health and safety aspects of 
the group’s business and copies of specific group safety policy documents can be obtained from the company 
secretary
charitable and community support
the group has an established charitable donations committee comprising employees based at the group’s 
premises in the uk and the usa the committee considers all requests for charitable and community project 
assistance from employees and external charities within a financial budget and criteria approved by the board on 
an annual basis
the group’s support through the committee is focused on the local geographical area of pace’s premises in 
the uk france india and the usa as well as the charitable and community initiatives of group employees the 
corporate charity policy focus is to support local charities of benefit to the local area and people living close to each 
group site
during the year a number of requests for support were considered by the committee of which 107 satisfied the 
criteria and received financial support amounting to 106675 in total the participation of employees of the group 
in community and charitable activities outside work hours has been encouraged by the provision of funds to match 
individual sponsorship raised donations amounting to 44071 were made to local charitable causes pursuant to 
the ceo’s discretion or prior board approval
pace has continued as lead sponsor of the leeds ahead education strand of business engagement in the uk’s 
west yorkshire region following its acceptance of this role for a two year period in 2010 this has enabled leeds 
ahead to develop and rollout their make the grade business education partnership model in the west yorkshire 
region 
in addition pace has partnered with teach first to support the science technology engineering and maths 
stem teachers in yorkshire and the humber pace will fund the provision of personal development coaches to 
teach first participants in their second year of teaching teach first recruits trains and supports teachers working 
in schools in low income communities to raise the achievement aspirations and access to opportunity of children 
from low socioeconomic backgrounds
supply chain
pace is a member of the electronic industry citizen coalition eicc and applies to the eicc code of conduct in 
its business a programme of assessment and auditing is maintained at the regular business review meetings held 
with the group’s principal suppliers during the year two members of the pace quality team undertook training and 
were certified as eiccgesi labour and ethics lead auditors
accreditation
pace is a member of business in the community bitc which operates in the uk and internationally through a 
network of partners worldwide membership allows pace to further develop and promote responsibility in business 
through access to the expertise and experience of the bitc team and their membership base
in the second half of the year the company participated in the bitc cr index the bitc cr index is an 
internationally recognised index of how effectively businesses identify address and integrates the management of 
their environmental and social impacts participation provides the group with a benchmark and gap analysis with 
best practice we are pleased to report that we achieved a silver ranking for our csr programme
environmental management
during the year the company set environmental targets and achieved the following outcomes in respect of its 
chosen measures of environmental impact
start date end date objective target status
2011 dec 11 drive a reduction in the overall 
environmental emissions associated with 
paces site operations
achieve a 5 reduction in overall co
2
 
intensity scope 1 2 and 3 by 2011  
scope 3 emissions as defined in 2010
not achieved 
2011 dec 11 drive innovation on the reduction of the 
environmental impact of pace products
seek to reduce average  stb co
2
 
emissions by 5 
target achieved 
total reduction 
88
seek to ensure that 90 of the hardware 
design of  pace  stbs  will comply with or 
exceed the eu code of conduct energy 
star and meps guidelines as appropriate 
target achieved 
100 hw 
designs comply
all stbs designed in 2011 to exceed a 
score of 80 during pace’s design for 
environmentdfe programme
target achieved 
average score 
86
2011 dec 12 drive a reduction in the environmental 
impact of pace’s stb manufacture
measure the co
2
 emission associated 
with the production of stbs pace scope 
3 manufacturing partners emissions
on target
2011 dec 11 commitment to offset investigate and develop an offsetting 
strategy appropriate to pace 
complete 
and not being 
progressed
2011 dec 12 align recent acquisitions with pace’s 
environmental principles and direction
increase pace’s 14001 footprint to include 
pace americas west and brazil  by 2012 
on target
the company has maintained certification to the international management standard iso 14001 at its saltaire 
florida bangalore and paris sites and for the first time achieved certification at the tempe and san antonio sites 
the group environmental policy has been applied to all pace sites worldwide
the company is a signatory to the european code of conduct on energy efficiency of digital tv service systems 
eu code of conduct energy star program requirements for stbs and meps minimum energy performance 
standard pace is committed to ensure that all products are designed to minimise energy consumption through its 
‘design for environment’ programme
  this year we have included information and data from our manufacturing facility in manaus brazil and the three facilities of pace west located in san jose san antonio and tempe formerly 2wire the usbased business we acquired in 2010 this has had the effect of 
increasing our absolute and normalised carbon emissions
pace plc 2011 annual report    20 19    pace plc 2011 annual report
report of
the directors continued
front end 2011 v10indd 2021 16032012 1125 pace plc 2011 annual report    22 21    pace plc 2011 annual report
auditors
kpmg held office as auditors during the year the audit committee reviews the independence and objectivity 
of the auditors considering whether taken as a whole the various relationships if any between the group and 
the auditors impair or appear to impair the auditors’ judgement or independence the committee was satisfied 
throughout the year that the objectivity and independence of kpmg was not in any way impaired by either the 
nature of the nonaudit related services undertaken during the year the level of the nonaudit fees charged or any 
other fact or circumstances
having considered the results of the committee’s work the board is recommending the reappointment of kpmg 
as auditors a resolution for the reappointment of kpmg will be proposed at the forthcoming annual general 
meeting
each of the directors who held office at the date of approval of this report of the directors confirms that so far 
as they are aware there is no relevant audit information of which the company’s auditors are unaware and the 
directors have each taken all the steps that they ought to have taken as a director to make themselves aware of 
any relevant audit information and to establish that the company’s auditors are aware of that information
relations with shareholders
the board has continued to establish and maintain relationships with institutional shareholders and communicates 
with investors through the group’s web site wwwpacecom a programme of meetings with institutional 
shareholders is in place at which institutional shareholders are offered the opportunity to meet with nonexecutive 
directors and analyst presentations are made following announcement of the interim and annual results 
shareholders are welcome to participate at the annual general meeting at which the board will be available for 
questions
annual general meeting
the annual general meeting of the company will be held on 16 april 2012 at the offices of the company at salts 
mill victoria road saltaire west yorkshire bd18 3lf full details of the business to be transacted at the meeting 
will be set out in the notice of annual general meeting
responsibility statement of the directors
a statement of the responsibilities of the directors is contained on page 31 the directors whose names appear on 
page 13 confirm that to the best of their knowledge
•	 	 the	financial	statements	pr epar ed	in	accor dance	with	the	applicable	set	of	accounting	standar ds	give	a	true	
and fair view of the assets liabilities financial position and profit or loss of the company and the undertakings 
included in the consolidation taken as a whole and 
•	 	 the	report	of	the	dir ectors	includes	a	fair	r eview	of	the	development	and	performance	of	the	business	and	the	
position of the company and the undertakings included in the consolidation taken as a whole together with the 
description of the principal risks and uncertainties that they face 
by order of the board
anthony j dixon 
company secretary
6 march 2012
the directors present their report to shareholders on pages 22 to 30 regarding remuneration matters in respect of 
the year ended 31 december 2011
remuneration committee
the remuneration committee the committee is responsible for setting the individual remuneration of the 
executive directors and other members of the executive committee within the framework of the remuneration 
policy described below which is set by the board
the directors who were members of the committee during the year were pat chapmanpincher chairman of 
the committee allan leighton from june 2011 mike mctighe until resignation and john grant for guidance 
the committee makes use of surveys of executive pay and knowledge of market rates the ceo and director 
of hr also attended remuneration committee meetings during the year by invitation and provided advice to the 
committee to enable it to reach informed decisions no director was present when their remuneration was being 
discussed the committee was assisted in its consideration of remuneration matters by kepler associates who 
were appointed by the committee kepler associates provided no other services to the group in the year pinsent 
masons legal advisers to the company also advised the committee regarding certain equity incentive related 
issues
remuneration policy
the board believes that it is necessary to ensure that the remuneration packages of the executive directors remain 
competitive in order to attract retain and motivate executive directors and senior managers of a high calibre and 
to reward them for performance the policy is for a significant proportion of executive directors’ total remuneration 
to be capable of being earned from variable performancebased incentives through annual bonuses and share 
based incentives the objective of this policy is to provide rewards and incentives that reflect corporate and 
individual performance and align management’s objectives directly with those of the shareholders more than half of 
an executive director’s remuneration is variable and is linked to corporate performance
the board’s policy in relation to nonexecutive directors continues to be to pay fees that are competitive with the 
fees paid by comparable quoted companies nonexecutive directors’ fees are determined by the board as a 
whole within the limits set out in the company’s articles of association nonexecutive directors are not eligible 
for performance bonuses or pension contributions and do not participate in the equity incentive plans save in 
respect of allan leighton’s appointment share award which was a oneoff exception to the policy nonexecutive 
remuneration is reviewed annually
salary
basic salary for each executive director is determined by the committee taking into account the performance of 
the individual and information from independent sources on external market salary levels for comparable jobs with 
a view to salaries being set around the median to upper quartile level for comparable companies in setting senior 
executives’ salaries the committee also takes into account pay and employment conditions in the group as a 
whole salary is generally reviewed at the commencement of each financial year as a result of the review in january 
2012 there were no increases in salaries of the executive directors for 2012 in line with group salaries the salary 
of mike pulli was fixed at 750000 per annum upon his appointment as ceo in december 2011 and the salary of 
roddy murray was fixed at 503750 upon his appointment in february 2012
performance bonus
the company established a nonpensionable performancerelated bonus plan for the executive directors and 
other key members of management for the year which was based on the successful achievement of corporate 
and individual objectives the corporate objectives were linked to the key drivers of value creation for shareholders 
and the key measure therefore was the profitability of the group for the full financial year achievement of the 2011 
bonus was dependent on the group’s pretax profits before certain exceptional items exceeding 176m with the 
capacity to earn additional bonus increments upon achievement of higher profit targets up to a ceiling of 196m 
in addition a number of individual personal objectives were set for each director and manager which were aligned 
with the objectives of the group for the year the maximum bonus achievable by the executive directors in the 
event that all corporate and individual targets were met was 150 of basic annual salary with one third of any 
bonus outcome achieved being deferred into shares in the company for a period of two years under the group 
deferred share bonus plan the committee retained a discretion to reduce the bonus otherwise payable by up 
to 20 based on their assessment of the management of the company’s cash position during the year the 
directors’
remuneration report
front end 2011 v10indd   2223 16032012   1125 pace plc 2011 annual report    22 21    pace plc 2011 annual report
auditors
kpmg held office as auditors during the year the audit committee reviews the independence and objectivity 
of the auditors considering whether taken as a whole the various relationships if any between the group and 
the auditors impair or appear to impair the auditors’ judgement or independence the committee was satisfied 
throughout the year that the objectivity and independence of kpmg was not in any way impaired by either the 
nature of the nonaudit related services undertaken during the year the level of the nonaudit fees charged or any 
other fact or circumstances
having considered the results of the committee’s work the board is recommending the reappointment of kpmg 
as auditors a resolution for the reappointment of kpmg will be proposed at the forthcoming annual general 
meeting
each of the directors who held office at the date of approval of this report of the directors confirms that so far 
as they are aware there is no relevant audit information of which the company’s auditors are unaware and the 
directors have each taken all the steps that they ought to have taken as a director to make themselves aware of 
any relevant audit information and to establish that the company’s auditors are aware of that information
relations with shareholders
the board has continued to establish and maintain relationships with institutional shareholders and communicates 
with investors through the group’s web site wwwpacecom a programme of meetings with institutional 
shareholders is in place at which institutional shareholders are offered the opportunity to meet with nonexecutive 
directors and analyst presentations are made following announcement of the interim and annual results 
shareholders are welcome to participate at the annual general meeting at which the board will be available for 
questions
annual general meeting
the annual general meeting of the company will be held on 16 april 2012 at the offices of the company at salts 
mill victoria road saltaire west yorkshire bd18 3lf full details of the business to be transacted at the meeting 
will be set out in the notice of annual general meeting
responsibility statement of the directors
a statement of the responsibilities of the directors is contained on page 31 the directors whose names appear on 
page 13 confirm that to the best of their knowledge
•	 	 the	financial	statements	pr epar ed	in	accor dance	with	the	applicable	set	of	accounting	standar ds	give	a	true	
and fair view of the assets liabilities financial position and profit or loss of the company and the undertakings 
included in the consolidation taken as a whole and 
•	 	 the	report	of	the	dir ectors	includes	a	fair	r eview	of	the	development	and	performance	of	the	business	and	the	
position of the company and the undertakings included in the consolidation taken as a whole together with the 
description of the principal risks and uncertainties that they face 
by order of the board
anthony j dixon 
company secretary
6 march 2012
the directors present their report to shareholders on pages 22 to 30 regarding remuneration matters in respect of 
the year ended 31 december 2011
remuneration committee
the remuneration committee the committee is responsible for setting the individual remuneration of the 
executive directors and other members of the executive committee within the framework of the remuneration 
policy described below which is set by the board
the directors who were members of the committee during the year were pat chapmanpincher chairman of 
the committee allan leighton from june 2011 mike mctighe until resignation and john grant for guidance 
the committee makes use of surveys of executive pay and knowledge of market rates the ceo and director 
of hr also attended remuneration committee meetings during the year by invitation and provided advice to the 
committee to enable it to reach informed decisions no director was present when their remuneration was being 
discussed the committee was assisted in its consideration of remuneration matters by kepler associates who 
were appointed by the committee kepler associates provided no other services to the group in the year pinsent 
masons legal advisers to the company also advised the committee regarding certain equity incentive related 
issues
remuneration policy
the board believes that it is necessary to ensure that the remuneration packages of the executive directors remain 
competitive in order to attract retain and motivate executive directors and senior managers of a high calibre and 
to reward them for performance the policy is for a significant proportion of executive directors’ total remuneration 
to be capable of being earned from variable performancebased incentives through annual bonuses and share 
based incentives the objective of this policy is to provide rewards and incentives that reflect corporate and 
individual performance and align management’s objectives directly with those of the shareholders more than half of 
an executive director’s remuneration is variable and is linked to corporate performance
the board’s policy in relation to nonexecutive directors continues to be to pay fees that are competitive with the 
fees paid by comparable quoted companies nonexecutive directors’ fees are determined by the board as a 
whole within the limits set out in the company’s articles of association nonexecutive directors are not eligible 
for performance bonuses or pension contributions and do not participate in the equity incentive plans save in 
respect of allan leighton’s appointment share award which was a oneoff exception to the policy nonexecutive 
remuneration is reviewed annually
salary
basic salary for each executive director is determined by the committee taking into account the performance of 
the individual and information from independent sources on external market salary levels for comparable jobs with 
a view to salaries being set around the median to upper quartile level for comparable companies in setting senior 
executives’ salaries the committee also takes into account pay and employment conditions in the group as a 
whole salary is generally reviewed at the commencement of each financial year as a result of the review in january 
2012 there were no increases in salaries of the executive directors for 2012 in line with group salaries the salary 
of mike pulli was fixed at 750000 per annum upon his appointment as ceo in december 2011 and the salary of 
roddy murray was fixed at 503750 upon his appointment in february 2012
performance bonus
the company established a nonpensionable performancerelated bonus plan for the executive directors and 
other key members of management for the year which was based on the successful achievement of corporate 
and individual objectives the corporate objectives were linked to the key drivers of value creation for shareholders 
and the key measure therefore was the profitability of the group for the full financial year achievement of the 2011 
bonus was dependent on the group’s pretax profits before certain exceptional items exceeding 176m with the 
capacity to earn additional bonus increments upon achievement of higher profit targets up to a ceiling of 196m 
in addition a number of individual personal objectives were set for each director and manager which were aligned 
with the objectives of the group for the year the maximum bonus achievable by the executive directors in the 
event that all corporate and individual targets were met was 150 of basic annual salary with one third of any 
bonus outcome achieved being deferred into shares in the company for a period of two years under the group 
deferred share bonus plan the committee retained a discretion to reduce the bonus otherwise payable by up 
to 20 based on their assessment of the management of the company’s cash position during the year the 
directors’
remuneration report
front end 2011 v10indd 2223 16032012 1125 pace plc 2011 annual report    24 23    pace plc 2011 annual report
committee having regard to the performance of the business during the period determined to award no bonus to 
any of neil gaydon stuart hall and david mckinney
mike pulli who was appointed a director on 14 december 2011 had a similarly structured bonus opportunity but 
primarily based on the performance of the pace americas sbu during the year but also dependent as to a portion 
15 on the group’s pretax profits having regard to the performance of the pace americas sbu during the 
year which exceeded its 2011 budget targets the committee determined to award maximum bonus to mike pulli 
referable to the performance of pace americas but no portion of the bonus was payable referable to the group’s 
pretax profits
prior to 2011 the committee had offered members of the executive committee the opportunity to earn an 
“exceptional” bonus up to 100 of salary in respect of the 2011 financial year the committee reviewed the 
executive bonus structure with its remuneration advisers the outcome of this review was a revised bonus structure 
which no longer had an opportunity for executives to earn a discretionary “exceptional” bonus and replaced this 
feature by a specific additional performance objective which could boost normal bonus outcomes achieved under 
the group pretax profit targets and individual objectives described above by up to twothirds but only if a positive 
bonus outcome is first achieved under the normal group pretax profits target and individual objectives potential 
maximum bonus outcomes are capped at 225 of base salary and onethird of all bonus outcomes achieved 
up to 150 of base salary deferred into shares for two years with deferral also applying on these terms to any 
bonus outcomes achieved between 150 and 225 of base salary this outline structure has been maintained 
in respect of the 2012 financial year except that earnings before interest tax and amortisation of other intangibles 
ebita will be used as the corporate target instead of pbt recognising the short term impact of acquisitionrelated 
items including amortisation of intangibles and interest the committee retains a discretion to reduce the bonus 
otherwise payable by up to 50 based on their assessment of the management of inventory levels during the year 
and achievement of targets on debtor days 
benefits in kind
each uk based executive director is entitled to benefits such as the provision of a fully expensed company car 
plus fuel or cash alternative private medical insurance permanent health insurance life insurance and where 
applicable relocation assistance mike pulli has equivalent benefits to the extent consistent with us labor market 
practice
pension contributions
in the year ending 31 december 2011 contributions were paid into the executive directors’ pension schemes at 
rates determined by the board contributions have continued to be paid during the current year at the rate of 15 
of each director’s basic salary the group does not operate any defined benefit schemes
performance share plans
following the approval of shareholders at the 2009 agm a new performance share plan psp was introduced 
with all group employees including executive directors eligible to participate under the psp  employees receive 
a conditional right to receive shares for no cost which will normally vest after 3 years subject to continued 
employment and the achievement of stretching performance conditions
psp awards granted prior to 2012 will vest subject to the achievement of 3year targets based on cumulative 
profit before tax pbt for the group during the year awards made to all employees across the group including 
executive directors were based on 3year group pbt the cumulative group pbt targets that apply to the awards 
made in 2011 are set out in note 4 to the directors’ share options table on page 29
the company’s policy is that psp awards will generally be satisfied using shares purchased in the market via the 
pace employee benefits share trust during the year the executive directors received psp awards over shares 
worth 100 of their basic salary
cumulative ebita targets are proposed for 2012 awards rather than cumulative pbt targets with cumulative ebita 
being measured over the three financial years 2012–2014 for these purposes ebita and previous pbt targets will 
be adjusted to exclude the amortisation of other intangibles exceptional items and other items that the committee 
determines to be appropriate to ensure it reflects underlying longterm performance these pbt  ebita target 
figures have been restated to reflect the switch to us dollar reporting the use of ebita targets for 2012 psp 
awards was considered to be appropriate as it aligns the focus of pace senior executives on a key measure of 
financial performance which is highly visible internally and externally and which is regularly monitored and reported 
following the general meeting of the company held on 18 october 2010 shareholders approved the adoption of a 
new performance share plan the international performance share plan ipsp the ipsp follows closely the terms 
of the psp however executive directors may not participate
share option plans
at present the executive directors may participate in two share option plans
•	 a	standar d	hmrc	appr oved	allemployee	shar esave	plan	
•	 the	company’ s	2005	discr etionary	shar e	option	plans	hmrc	appr oved	and	unappr oved	plans	
in 2011 executive directors were granted sharesave options and also received option grants under the 2005 
discretionary share option plans details of the performance conditions applying to all outstanding share options 
held by the executive directors including options granted in 2011 are set out in the footnotes to the directors’ 
share options table on page 29
the maximum award of options to any employee pursuant to the hmrc approved plan is 46500 the maximum 
award of options under the unapproved plan to any employee in each year is 200 of salary or in exceptional 
circumstances as determined by the committee 400 of salary option awards are targeted at the company’s 
most senior executives and are based on a fixed number of options subject always to the discretion of the 
committee to utilise other award criteria in exceptional circumstances option awards vest subject to real eps 
growth as noted on page 29 the committee believes eps targets to be appropriate to enhance alignment of the 
senior executives with shareholder interests whilst still maintaining focus on profitability
share award contracts
the following information is given pursuant to listing rule 943
as part of the terms on which allan leighton was appointed he agreed to purchase 310000 of pace shares 
and the company agreed to match this personal investment on a twoforone basis that will vest on the third 
anniversary of his appointment which occurred on 31 may 2011 an additional award over 600000 pace shares 
was made at the same time and will vest dependent on share price performance over a four year period 25 of 
this award will vest at a share price of 145p with full vesting at 190p both awards are subject to the shares being 
retained until at least the fifth anniversary of appointment the awards will normally lapse on cessation of the office 
within three years on a change of control the awards will vest with vesting of the shareprice related awards 
dependent on share price performance vesting may also occur on certain other corporate events the maximum 
number of shares awarded under this arrangement is 938810 shares the remuneration committee considered 
the circumstances relating to this appointment unusual because of the significant personal financial investment 
that allan leighton was prepared to make in the company and the need to secure his unique experience at a time 
when the business was facing a number of challenges 
in march 2010 the remuneration committee agreed to make an individual award of contingent shares the “2010 
share award” to mike pulli equivalent to 1 x annual salary 171480 ordinary shares vesting of the 2010 share 
award was dependent on achievement of budget by pace americas in each of 2010 and 2011 financial years 
vesting is expected to be achieved in full on 15 march 2012 and particulars of this award are contained in the table 
on page 29
minimum shareholding
following the review of the group’s remuneration policies completed in february 2009 the committee introduced 
individual shareholding target requirements for members of the executive committee including executive directors 
with a requirement subject to a discretion of the remuneration committee for such executives to retain a 
portion of any net awards ie after tax and exercise cost of newly vested sharebased incentives until the target 
shareholding level is reached the target shareholding is approximately 100 of the executive’s annual salary 
and up to 50 of shares earned but held under the company’s deferred share bonus plan are deemed to count 
towards the ownership target each executive is required to achieve target ownership level within a period of five 
years
directors’
remuneration report continued
front end 2011 v10indd   2425 16032012   1125 pace plc 2011 annual report    24 23    pace plc 2011 annual report
committee having regard to the performance of the business during the period determined to award no bonus to 
any of neil gaydon stuart hall and david mckinney
mike pulli who was appointed a director on 14 december 2011 had a similarly structured bonus opportunity but 
primarily based on the performance of the pace americas sbu during the year but also dependent as to a portion 
15 on the group’s pretax profits having regard to the performance of the pace americas sbu during the 
year which exceeded its 2011 budget targets the committee determined to award maximum bonus to mike pulli 
referable to the performance of pace americas but no portion of the bonus was payable referable to the group’s 
pretax profits
prior to 2011 the committee had offered members of the executive committee the opportunity to earn an 
“exceptional” bonus up to 100 of salary in respect of the 2011 financial year the committee reviewed the 
executive bonus structure with its remuneration advisers the outcome of this review was a revised bonus structure 
which no longer had an opportunity for executives to earn a discretionary “exceptional” bonus and replaced this 
feature by a specific additional performance objective which could boost normal bonus outcomes achieved under 
the group pretax profit targets and individual objectives described above by up to twothirds but only if a positive 
bonus outcome is first achieved under the normal group pretax profits target and individual objectives potential 
maximum bonus outcomes are capped at 225 of base salary and onethird of all bonus outcomes achieved 
up to 150 of base salary deferred into shares for two years with deferral also applying on these terms to any 
bonus outcomes achieved between 150 and 225 of base salary this outline structure has been maintained 
in respect of the 2012 financial year except that earnings before interest tax and amortisation of other intangibles 
ebita will be used as the corporate target instead of pbt recognising the short term impact of acquisitionrelated 
items including amortisation of intangibles and interest the committee retains a discretion to reduce the bonus 
otherwise payable by up to 50 based on their assessment of the management of inventory levels during the year 
and achievement of targets on debtor days 
benefits in kind
each uk based executive director is entitled to benefits such as the provision of a fully expensed company car 
plus fuel or cash alternative private medical insurance permanent health insurance life insurance and where 
applicable relocation assistance mike pulli has equivalent benefits to the extent consistent with us labor market 
practice
pension contributions
in the year ending 31 december 2011 contributions were paid into the executive directors’ pension schemes at 
rates determined by the board contributions have continued to be paid during the current year at the rate of 15 
of each director’s basic salary the group does not operate any defined benefit schemes
performance share plans
following the approval of shareholders at the 2009 agm a new performance share plan psp was introduced 
with all group employees including executive directors eligible to participate under the psp  employees receive 
a conditional right to receive shares for no cost which will normally vest after 3 years subject to continued 
employment and the achievement of stretching performance conditions
psp awards granted prior to 2012 will vest subject to the achievement of 3year targets based on cumulative 
profit before tax pbt for the group during the year awards made to all employees across the group including 
executive directors were based on 3year group pbt the cumulative group pbt targets that apply to the awards 
made in 2011 are set out in note 4 to the directors’ share options table on page 29
the company’s policy is that psp awards will generally be satisfied using shares purchased in the market via the 
pace employee benefits share trust during the year the executive directors received psp awards over shares 
worth 100 of their basic salary
cumulative ebita targets are proposed for 2012 awards rather than cumulative pbt targets with cumulative ebita 
being measured over the three financial years 2012–2014 for these purposes ebita and previous pbt targets will 
be adjusted to exclude the amortisation of other intangibles exceptional items and other items that the committee 
determines to be appropriate to ensure it reflects underlying longterm performance these pbt  ebita target 
figures have been restated to reflect the switch to us dollar reporting the use of ebita targets for 2012 psp 
awards was considered to be appropriate as it aligns the focus of pace senior executives on a key measure of 
financial performance which is highly visible internally and externally and which is regularly monitored and reported 
following the general meeting of the company held on 18 october 2010 shareholders approved the adoption of a 
new performance share plan the international performance share plan ipsp the ipsp follows closely the terms 
of the psp however executive directors may not participate
share option plans
at present the executive directors may participate in two share option plans
•	a	standar d	hmrc	appr oved	allemployee	shar esave	plan	
•	 the	company’ s	2005	discr etionary	shar e	option	plans	hmrc	appr oved	and	unappr oved	plans	
in 2011 executive directors were granted sharesave options and also received option grants under the 2005 
discretionary share option plans details of the performance conditions applying to all outstanding share options 
held by the executive directors including options granted in 2011 are set out in the footnotes to the directors’ 
share options table on page 29
the maximum award of options to any employee pursuant to the hmrc approved plan is 46500 the maximum 
award of options under the unapproved plan to any employee in each year is 200 of salary or in exceptional 
circumstances as determined by the committee 400 of salary option awards are targeted at the company’s 
most senior executives and are based on a fixed number of options subject always to the discretion of the 
committee to utilise other award criteria in exceptional circumstances option awards vest subject to real eps 
growth as noted on page 29 the committee believes eps targets to be appropriate to enhance alignment of the 
senior executives with shareholder interests whilst still maintaining focus on profitability
share award contracts
the following information is given pursuant to listing rule 943
as part of the terms on which allan leighton was appointed he agreed to purchase 310000 of pace shares 
and the company agreed to match this personal investment on a twoforone basis that will vest on the third 
anniversary of his appointment which occurred on 31 may 2011 an additional award over 600000 pace shares 
was made at the same time and will vest dependent on share price performance over a four year period 25 of 
this award will vest at a share price of 145p with full vesting at 190p both awards are subject to the shares being 
retained until at least the fifth anniversary of appointment the awards will normally lapse on cessation of the office 
within three years on a change of control the awards will vest with vesting of the shareprice related awards 
dependent on share price performance vesting may also occur on certain other corporate events the maximum 
number of shares awarded under this arrangement is 938810 shares the remuneration committee considered 
the circumstances relating to this appointment unusual because of the significant personal financial investment 
that allan leighton was prepared to make in the company and the need to secure his unique experience at a time 
when the business was facing a number of challenges 
in march 2010 the remuneration committee agreed to make an individual award of contingent shares the “2010 
share award” to mike pulli equivalent to 1 x annual salary 171480 ordinary shares vesting of the 2010 share 
award was dependent on achievement of budget by pace americas in each of 2010 and 2011 financial years 
vesting is expected to be achieved in full on 15 march 2012 and particulars of this award are contained in the table 
on page 29
minimum shareholding
following the review of the group’s remuneration policies completed in february 2009 the committee introduced 
individual shareholding target requirements for members of the executive committee including executive directors 
with a requirement subject to a discretion of the remuneration committee for such executives to retain a 
portion of any net awards ie after tax and exercise cost of newly vested sharebased incentives until the target 
shareholding level is reached the target shareholding is approximately 100 of the executive’s annual salary 
and up to 50 of shares earned but held under the company’s deferred share bonus plan are deemed to count 
towards the ownership target each executive is required to achieve target ownership level within a period of five 
years
directors’
remuneration report continued
front end 2011 v10indd 2425 16032012 1125 pace plc 2011 annual report    26 25    pace plc 2011 annual report
service contracts
company policy is that executive directors’ notice periods should not exceed 1 year each of the executive 
directors has a service contract with the company each of these agreements is terminable by the company on 12 
months’ prior written notice or by the relevant director on not less than 6 months’ prior written notice at the option 
of the company each agreement may be terminated forthwith subject to the company paying a sum equivalent to 
12 months’ salary benefits and pension contributions 
it is the company’s policy to honour its obligations with regard to directors’ service agreements and where the 
employment of a director is terminated in accordance with the aforementioned contractual process the company 
will pay the sum specified in the relevant service agreement as payable or otherwise pay fair and reasonable 
compensation
the service agreement of mike pulli with pace americas inc became effective on 13 november 2003 was 
amended on 26 october 2004 and was most recently amended by decision of the remuneration committee to 
reflect his appointment as ceo and new terms as outlined above but varied to reflect us practice and custom on 
14 december 2011 the service agreement of stuart hall became effective on 2 april 2007 and was most recently 
amended on 26 january 2011 the service agreement of roddy murray became effective on 23 february 2012 
save for the notice periods referred to in the above paragraph these contracts have no unexpired term
each of the nonexecutive directors is appointed under a letter of appointment which is terminable at any time by 
the company without contractual notice where notice is not given termination is generally subject to payment of 
an amount equal to three months’ directors’ fees each of the directors and certain officers of subsidiaries of the 
company has a letter of indemnity issued by the company which provides an indemnity in respect of liabilities 
incurred in the course of their office to the extent permitted by the company’s articles of association and the 
provisions of the companies act
copies of the service contracts of the executive directors and the letters of appointment of the nonexecutive 
directors together with the share award contracts and letters of indemnity referred to above are available for 
inspection during normal business hours saturdays sundays and public holidays excepted at the registered 
office of the company
the company maintains directors’ and officers’ liability insurance in respect of senior employees and officers of the 
group including the directors the consent of the board is required in the event that an executive director wishes 
to accept an external appointment it has been the practice of the company to permit a director to retain non
executive fees arising from any such appointment but during the year none of the current executive directors held 
such external appointments
the auditors are required to report on the information disclosed on pages 26 to 29
directors’ remuneration
total directors’ remuneration in respect of qualifying services for the year ended 31 december 2011 was as follows
  restated
 2011 2010 
 000 000
fees 532 467 
salaries benefits in kind and termination payments 2792 1702 
performancerelated bonuses 24 1628
pension contributions 219 296
 3567 4093 
the remuneration of individual directors in respect of qualifying services for the year ended 31 december 2011 is 
set out in the table below
  salaries performance termination  total  pension 
  fees and  bounus payment  remuneration  contributions 
  benefits in kind    restated  restated
     2011 2010 2011 2010
executive  
directors  000 000 000 000 000 000 000 
mike pulli  35 24  59  5 
neil gaydon  803  915 1718 1454 82 170
david mckinney  512   512 922 73 67
stuart hall  527   527 953 59 59
  1877 24 915 2816 3329 219 296
 
nonexecutive  
directors
allan leighton  146   146   
mike mctighe  167   167 246  
pat chapmanpincher  77   77 77  
jon grant  77   77 77  
mike inglis  65   65 65  
  2409 24 915 3348 3794 219 296
 
remuneration referable only to the period of the financial year from date of appointment or up to retirement from the board
  
a termination payment of 914500 was payable to neil gaydon by way of compensation for termination of employment payable in two tranches 604500 paid 
17 january 2012 and 310000 is payable on 7 april 2012
  
figures relate to the cash element of the annual performance related bonus prorated to reflect the period during the year that mike pulli was a director the 
additional amount of 260286 was awarded to mike pulli and will be deferred into shares of the company for a period of two years under the terms of the group 
deferred share bonus plan and normally subject to forfeiture if he leaves the company during the period
directors’
remuneration report continued
front end 2011 v10indd   2627 16032012   1125 pace plc 2011 annual report    26 25    pace plc 2011 annual report
service contracts
company policy is that executive directors’ notice periods should not exceed 1 year each of the executive 
directors has a service contract with the company each of these agreements is terminable by the company on 12 
months’ prior written notice or by the relevant director on not less than 6 months’ prior written notice at the option 
of the company each agreement may be terminated forthwith subject to the company paying a sum equivalent to 
12 months’ salary benefits and pension contributions 
it is the company’s policy to honour its obligations with regard to directors’ service agreements and where the 
employment of a director is terminated in accordance with the aforementioned contractual process the company 
will pay the sum specified in the relevant service agreement as payable or otherwise pay fair and reasonable 
compensation
the service agreement of mike pulli with pace americas inc became effective on 13 november 2003 was 
amended on 26 october 2004 and was most recently amended by decision of the remuneration committee to 
reflect his appointment as ceo and new terms as outlined above but varied to reflect us practice and custom on 
14 december 2011 the service agreement of stuart hall became effective on 2 april 2007 and was most recently 
amended on 26 january 2011 the service agreement of roddy murray became effective on 23 february 2012 
save for the notice periods referred to in the above paragraph these contracts have no unexpired term
each of the nonexecutive directors is appointed under a letter of appointment which is terminable at any time by 
the company without contractual notice where notice is not given termination is generally subject to payment of 
an amount equal to three months’ directors’ fees each of the directors and certain officers of subsidiaries of the 
company has a letter of indemnity issued by the company which provides an indemnity in respect of liabilities 
incurred in the course of their office to the extent permitted by the company’s articles of association and the 
provisions of the companies act
copies of the service contracts of the executive directors and the letters of appointment of the nonexecutive 
directors together with the share award contracts and letters of indemnity referred to above are available for 
inspection during normal business hours saturdays sundays and public holidays excepted at the registered 
office of the company
the company maintains directors’ and officers’ liability insurance in respect of senior employees and officers of the 
group including the directors the consent of the board is required in the event that an executive director wishes 
to accept an external appointment it has been the practice of the company to permit a director to retain non
executive fees arising from any such appointment but during the year none of the current executive directors held 
such external appointments
the auditors are required to report on the information disclosed on pages 26 to 29
directors’ remuneration
total directors’ remuneration in respect of qualifying services for the year ended 31 december 2011 was as follows
  restated
 2011 2010 
 000 000
fees 532 467 
salaries benefits in kind and termination payments 2792 1702 
performancerelated bonuses 24 1628
pension contributions 219 296
 3567 4093 
the remuneration of individual directors in respect of qualifying services for the year ended 31 december 2011 is 
set out in the table below
  salaries performance termination  total  pension 
  fees and  bounus payment  remuneration  contributions 
  benefits in kind    restated  restated
     2011 2010 2011 2010
executive  
directors  000 000 000 000 000 000 000 
mike pulli  35 24  59  5 
neil gaydon  803  915 1718 1454 82 170
david mckinney  512   512 922 73 67
stuart hall  527   527 953 59 59
  1877 24 915 2816 3329 219 296
 
nonexecutive  
directors
allan leighton  146   146   
mike mctighe  167   167 246  
pat chapmanpincher  77   77 77  
jon grant  77   77 77  
mike inglis  65   65 65  
  2409 24 915 3348 3794 219 296
 
remuneration referable only to the period of the financial year from date of appointment or up to retirement from the board
  
a termination payment of 914500 was payable to neil gaydon by way of compensation for termination of employment payable in two tranches 604500 paid 
17 january 2012 and 310000 is payable on 7 april 2012
  
figures relate to the cash element of the annual performance related bonus prorated to reflect the period during the year that mike pulli was a director the 
additional amount of 260286 was awarded to mike pulli and will be deferred into shares of the company for a period of two years under the terms of the group 
deferred share bonus plan and normally subject to forfeiture if he leaves the company during the period
directors’
remuneration report continued
front end 2011 v10indd 2627 16032012 1125 pace plc 2011 annual report    28 27    pace plc 2011 annual report
directors’ interests in shares and share options
the interests of directors holding office at the yearend and those of their immediate families in the ordinary share 
capital of the company at 31 december 2011 and at the beginning of the period are set out below
  31 december 2011 shares   1 january 2011 shares
  non  under  non under 
    beneficial beneficial  option beneficial beneficial option
allan leighton  169405  938810    
pat chapmanpincher  15551   15000    
john grant 65000      
mike inglis 25344   20000   
mike pulli 109028  3270138   1493003
stuart hall 128411  2739127 12739  2242388  
david mckinney 63307  2137041 38159   1640523 
neil gaydon 176070  1546805 52483  2955007 
 
on 6 january 2012 583989 options over shares in the company lapsed in respect of david mckinney’s interest as 
a result of the terms of his termination of employment
there were no changes in the directors’ interests in the ordinary share capital of the company between 31 
december 2011 and 6 march 2012 roddy murray is the beneficial owner of 100000 ordinary shares in the 
company purchased by him prior to his appointment
directors’ share options
details of the options andor contingent awards over the ordinary shares of 5p each in the company held by the 
directors who held office during the year were as follows
 notes at                    number of options  at  vesting  
  31 dec                31 dec  exercise period 
  2010 granted exercised lapsed 2011 price from to
neil gaydon 
2000 unapproved plan 1 20000    20000 510p 170805 311212 
2005 approved plan  16977   16977  1767p 080313 070320 
2005 unapproved plan 3 467836    467836 855p 240611 311212 
2005 unapproved plan 3 350000    350000 750p 110312 100313 
2005 unapproved plan 3 333023   333023  1767p 080313 070320 
2005 unapproved plan 3 684342   684342  1785p 110313 100320
2005 unapproved plan 3  350000  350000  1535p 040414 030421 
deferred share bonus  243407  243407   00p 270211 260811 
deferred share bonus  325320    325320 00p 260212 250220
deferred share bonus   148355   148355 00p 280213 270214 
performance share plan 4 235294    235294 00p 050512 050512 
performance share plan 4 268848   268848  00p 080313 070320
performance share plan 4  322511  322511  00p 040414 030421
sharesave plan  7014   7014  670p 011011 300312 
sharesave plan  2946   2946  1540p 010613 311113
 in the case of neil gaydon information given as at date of cessation of employment 31 december 2011
mike pulli
2010 share award  171480    171480 00p 150312 150312 
2005 unapproved plan 3 177614    177614 855p 240611 230618 
2005 unapproved plan 3 250000    250000 750p 110312 100319 
2005 unapproved plan 3 250000    250000 1767p 080313 070320
2005 unapproved plan 3  250000   250000 1535p 040414 030421
2005 unapproved plan 3  1395275   1395275 6975p 151214 141221 
deferred share bonus  172007  172007   00p 270211 260811 
deferred share bonus  214350    214350 00p 260212 250220
deferred share bonus   120474   120474 00p 280213 270221 
performance share plan 4 117898    117898 00p 050512 050512
performance share plan 4 139654    139654 00p 080313 070313
performance share plan 4  181061   181061 00p 040414 030414 
us sharesave plan   2332   2332 1360p 040612 070912
david mckinney
2005 approved plan  16977    16977 1767p 080313 070320 
2005 unapproved plan 3 280701    280701 855p 240611 230618 
2005 unapproved plan 3 350000    350000 750p 110312 100319 
2005 unapproved plan 3 333023    333023 1767p 080313 070320
2005 unapproved plan 3  350000   350000 1535p 040414 030421 
deferred share bonus  146044  146044   00p 270211 260811 
deferred share bonus  195192    195192 00p 260212 250220
deferred share bonus   93528   93528 00p 280213 270221 
performance share plan 4 141176    141176 00p 050512 050512 
performance share plan 4 169491    169491 00p 080313 070320
performance share plan 4  203182   203182 00p 040414 030421 
sharesave plan  4148  4148   820p 011010 310311 
sharesave plan  3771    3771 1540p 011013 310314
stuart hall
2005 approved plan 2 40955     40955 733p 030410 020417 
2005 unapproved plan 2 505120    505120 733p 030410 020417 
2005 unapproved plan 3 298245    298245 855p 240611 230618 
2005 unapproved plan 3 350000    350000 750p 110312 100319 
2005 unapproved plan 3 350000     350000 1767p 080313 070320
2005 unapproved plan 3  350000   350000 1535p 040414 030421 
deferred share bonus   155172  155172   00p 270211 260811 
deferred share bonus   206036     206036 00p 260212 250220
deferred share bonus    96753    96753 00p 280213 270221 
performance share plan 4 150000    150000 00p 050512 050512 
performance share plan 4 175336    175336 00p 080313 070320
performance share plan 4  209632   209632 00p 040414 030421 
sharesave plan  11524  11524   820p 011010 310311
sharesave plan   7050   7050 1280p 011614 311114
allan leighton
shareprice award    600000   600000 50p 310514 310515 
matching award 5  338810   338810 50p 310514 310514
 
directors’
remuneration report continued
front end 2011 v10indd   2829 16032012   1125 pace plc 2011 annual report    28 27    pace plc 2011 annual report
directors’ interests in shares and share options
the interests of directors holding office at the yearend and those of their immediate families in the ordinary share 
capital of the company at 31 december 2011 and at the beginning of the period are set out below
  31 december 2011 shares   1 january 2011 shares
  non  under  non under 
    beneficial beneficial  option beneficial beneficial option
allan leighton  169405  938810    
pat chapmanpincher  15551   15000    
john grant 65000      
mike inglis 25344   20000   
mike pulli 109028  3270138   1493003
stuart hall 128411  2739127 12739  2242388  
david mckinney 63307  2137041 38159   1640523 
neil gaydon 176070  1546805 52483  2955007 
 
on 6 january 2012 583989 options over shares in the company lapsed in respect of david mckinney’s interest as 
a result of the terms of his termination of employment
there were no changes in the directors’ interests in the ordinary share capital of the company between 31 
december 2011 and 6 march 2012 roddy murray is the beneficial owner of 100000 ordinary shares in the 
company purchased by him prior to his appointment
directors’ share options
details of the options andor contingent awards over the ordinary shares of 5p each in the company held by the 
directors who held office during the year were as follows
 notes at                    number of options  at  vesting  
  31 dec                31 dec  exercise period 
  2010 granted exercised lapsed 2011 price from to
neil gaydon 
2000 unapproved plan 1 20000    20000 510p 170805 311212 
2005 approved plan  16977   16977  1767p 080313 070320 
2005 unapproved plan 3 467836    467836 855p 240611 311212 
2005 unapproved plan 3 350000    350000 750p 110312 100313 
2005 unapproved plan 3 333023   333023  1767p 080313 070320 
2005 unapproved plan 3 684342   684342  1785p 110313 100320
2005 unapproved plan 3  350000  350000  1535p 040414 030421 
deferred share bonus  243407  243407   00p 270211 260811 
deferred share bonus  325320    325320 00p 260212 250220
deferred share bonus   148355   148355 00p 280213 270214 
performance share plan 4 235294    235294 00p 050512 050512 
performance share plan 4 268848   268848  00p 080313 070320
performance share plan 4  322511  322511  00p 040414 030421
sharesave plan  7014   7014  670p 011011 300312 
sharesave plan  2946   2946  1540p 010613 311113
 in the case of neil gaydon information given as at date of cessation of employment 31 december 2011
mike pulli
2010 share award  171480    171480 00p 150312 150312 
2005 unapproved plan 3 177614    177614 855p 240611 230618 
2005 unapproved plan 3 250000    250000 750p 110312 100319 
2005 unapproved plan 3 250000    250000 1767p 080313 070320
2005 unapproved plan 3  250000   250000 1535p 040414 030421
2005 unapproved plan 3  1395275   1395275 6975p 151214 141221 
deferred share bonus  172007  172007   00p 270211 260811 
deferred share bonus  214350    214350 00p 260212 250220
deferred share bonus   120474   120474 00p 280213 270221 
performance share plan 4 117898    117898 00p 050512 050512
performance share plan 4 139654    139654 00p 080313 070313
performance share plan 4  181061   181061 00p 040414 030414 
us sharesave plan   2332   2332 1360p 040612 070912
david mckinney
2005 approved plan  16977    16977 1767p 080313 070320 
2005 unapproved plan 3 280701    280701 855p 240611 230618 
2005 unapproved plan 3 350000    350000 750p 110312 100319 
2005 unapproved plan 3 333023    333023 1767p 080313 070320
2005 unapproved plan 3  350000   350000 1535p 040414 030421 
deferred share bonus  146044  146044   00p 270211 260811 
deferred share bonus  195192    195192 00p 260212 250220
deferred share bonus   93528   93528 00p 280213 270221 
performance share plan 4 141176    141176 00p 050512 050512 
performance share plan 4 169491    169491 00p 080313 070320
performance share plan 4  203182   203182 00p 040414 030421 
sharesave plan  4148  4148   820p 011010 310311 
sharesave plan  3771    3771 1540p 011013 310314
stuart hall
2005 approved plan 2 40955     40955 733p 030410 020417 
2005 unapproved plan 2 505120    505120 733p 030410 020417 
2005 unapproved plan 3 298245    298245 855p 240611 230618 
2005 unapproved plan 3 350000    350000 750p 110312 100319 
2005 unapproved plan 3 350000     350000 1767p 080313 070320
2005 unapproved plan 3  350000   350000 1535p 040414 030421 
deferred share bonus   155172  155172   00p 270211 260811 
deferred share bonus   206036     206036 00p 260212 250220
deferred share bonus    96753    96753 00p 280213 270221 
performance share plan 4 150000    150000 00p 050512 050512 
performance share plan 4 175336    175336 00p 080313 070320
performance share plan 4  209632   209632 00p 040414 030421 
sharesave plan  11524  11524   820p 011010 310311
sharesave plan   7050   7050 1280p 011614 311114
allan leighton
shareprice award    600000   600000 50p 310514 310515 
matching award 5  338810   338810 50p 310514 310514
 
directors’
remuneration report continued
front end 2011 v10indd 2829 16032012 1125 pace plc 2011 annual report    30 29    pace plc 2011 annual report
on 29 july 2011 david mckinney exercised 146044 shares under the deferred share bonus plan and retained 
11000 shares the share price at this date was 10945p giving a gain of 247760 on 14 march 2011 david 
mckinney also exercised and retained 4148 shares under the sharesave plan the share price at this date was 
1710p
 on 10 august 2011 neil gaydon exercised 243407 shares under the deferred share bonus plan and retained 
116386 shares the share price at this date was 9623p giving a gain of 234230
on 12 august 2011 stuart hall exercised 155172 shares under the deferred share bonus plan and retained 
74148 shares the share price at this date was 9616p giving a gain of 232345 on 25 march 2011 stuart hall 
also exercised and retained 11524 shares under the sharesave plan the share price at this date was 1616p 
notes performance conditions
1  under the 2000 unapproved scheme performance conditions of 6 per annum compound above rpi were 
applied to the grant of options 
2  options subject to performance conditions based on growth in the pretax profits of the group pbt over a 
period of three financial years with 25 of options vesting at 107 million pbt in the third financial year and 
100 of options vesting at 267 million pbt in the third financial year with vesting on a sliding scale between 
these two target thresholds 
3  options granted in fy 2008 are subject to performance conditions based on cumulative growth in eps requiring 
a minimum growth in eps of 4 per annum above inflation over a threeyear period at which level there is 25 
vesting cumulative growth of 8 per annum above inflation is required for 100 vesting options granted in fy 
2009 fy 2010 fy 2011 and fy 2012 are subject to performance conditions based on similar cumulative eps 
growth but with increased eps growth required for maximum vesting from rpi  8 to rpi  15 per annum 
in order to assess whether the performance conditions have been met the committee will utilize the earnings 
figures derived from the audited financial statements of the group adjusted to exclude exceptional or other 
items that the committee determines appropriate to ensure they reflect underlying long term performance 
4  psp awards will vest subject to the achievement of 3year targets based on cumulative pbt for the group prior 
to 2012 and awards granted in 2012 will vest subject to achievement of three year targets based on cumulative 
ebita for the group 
cumulative pbt over 3 years
 of total award  
shares vesting
2009 awards 2010 awards 2011 awards
100 
between 25 and 100  
pro rata
25
nil
225 million 
between 132 million and 
225 million 
132 million
less than 132 million
442 million 
between 395 million and 
442 million
395 million
less than 395 million
682 million 
between 519 million and 
682 million
519 million
less than 519 million
5  the allan leighton appointment share award shares which vest dependent on share price vest as to 25 on 
achievement of the threshold price of £145 with full vesting at £190 and straight line vesting in between
the midmarket price of shares in the company on 31 december 2011 was 720p the lowest and highest closing 
midmarket prices of shares in the company during the year were 4404p and 23180p respectively
employee benefits trust
the company has established the pace plc employee benefits trust which is capable of acquiring shares in the 
company in the market and using them for the purposes of satisfying new awards granted under the company’s 
share option plans the deferred share bonus plan and the performance share plans
performance graph
set out below is a performance graph showing the total shareholder return of the company for the 5 financial 
years ended 31 december 2011 compared to the total shareholder return of the ftse electronics and electrical 
equipment sector index which is considered by the board to be an appropriate benchmark index against which to 
compare the company’s performance having regard to the principal activities of the group
0p 
50p 
100p 
150p 
200p 
250p 
300p 
jan07 jan08 jan09 jan10 jan11 jan12 
pace ftse allshare electronic  electrical equipment reb 
by order of the board
anthony j dixon 
company secretary
6 march 2012
directors’
remuneration report continued
front end 2011 v10indd 3031 16032012 1125 pace plc 2011 annual report    30 29    pace plc 2011 annual report
on 29 july 2011 david mckinney exercised 146044 shares under the deferred share bonus plan and retained 
11000 shares the share price at this date was 10945p giving a gain of 247760 on 14 march 2011 david 
mckinney also exercised and retained 4148 shares under the sharesave plan the share price at this date was 
1710p
 on 10 august 2011 neil gaydon exercised 243407 shares under the deferred share bonus plan and retained 
116386 shares the share price at this date was 9623p giving a gain of 234230
on 12 august 2011 stuart hall exercised 155172 shares under the deferred share bonus plan and retained 
74148 shares the share price at this date was 9616p giving a gain of 232345 on 25 march 2011 stuart hall 
also exercised and retained 11524 shares under the sharesave plan the share price at this date was 1616p 
notes performance conditions
1  under the 2000 unapproved scheme performance conditions of 6 per annum compound above rpi were 
applied to the grant of options 
2  options subject to performance conditions based on growth in the pretax profits of the group pbt over a 
period of three financial years with 25 of options vesting at 107 million pbt in the third financial year and 
100 of options vesting at 267 million pbt in the third financial year with vesting on a sliding scale between 
these two target thresholds 
3  options granted in fy 2008 are subject to performance conditions based on cumulative growth in eps requiring 
a minimum growth in eps of 4 per annum above inflation over a threeyear period at which level there is 25 
vesting cumulative growth of 8 per annum above inflation is required for 100 vesting options granted in fy 
2009 fy 2010 fy 2011 and fy 2012 are subject to performance conditions based on similar cumulative eps 
growth but with increased eps growth required for maximum vesting from rpi  8 to rpi  15 per annum 
in order to assess whether the performance conditions have been met the committee will utilize the earnings 
figures derived from the audited financial statements of the group adjusted to exclude exceptional or other 
items that the committee determines appropriate to ensure they reflect underlying long term performance 
4  psp awards will vest subject to the achievement of 3year targets based on cumulative pbt for the group prior 
to 2012 and awards granted in 2012 will vest subject to achievement of three year targets based on cumulative 
ebita for the group 
cumulative pbt over 3 years
 of total award  
shares vesting
2009 awards 2010 awards 2011 awards
100 
between 25 and 100  
pro rata
25
nil
225 million 
between 132 million and 
225 million 
132 million
less than 132 million
442 million 
between 395 million and 
442 million
395 million
less than 395 million
682 million 
between 519 million and 
682 million
519 million
less than 519 million
5  the allan leighton appointment share award shares which vest dependent on share price vest as to 25 on 
achievement of the threshold price of £145 with full vesting at £190 and straight line vesting in between
the midmarket price of shares in the company on 31 december 2011 was 720p the lowest and highest closing 
midmarket prices of shares in the company during the year were 4404p and 23180p respectively
employee benefits trust
the company has established the pace plc employee benefits trust which is capable of acquiring shares in the 
company in the market and using them for the purposes of satisfying new awards granted under the company’s 
share option plans the deferred share bonus plan and the performance share plans
performance graph
set out below is a performance graph showing the total shareholder return of the company for the 5 financial 
years ended 31 december 2011 compared to the total shareholder return of the ftse electronics and electrical 
equipment sector index which is considered by the board to be an appropriate benchmark index against which to 
compare the company’s performance having regard to the principal activities of the group
0p 
50p 
100p 
150p 
200p 
250p 
300p 
jan07 jan08 jan09 jan10 jan11 jan12 
pace ftse allshare electronic  electrical equipment reb 
by order of the board
anthony j dixon 
company secretary
6 march 2012
directors’
remuneration report continued
front end 2011 v10indd 3031 16032012 1125 pace plc 2011 annual report    32 31    pace plc 2011 annual report
statement of directors’ responsibilities
the directors are responsible for preparing the annual report and accounts and the group and company financial 
statements in accordance with applicable law and regulations
company law requires the directors to prepare group and company financial statements for each financial year 
under that law they are required to prepare the group financial statements in accordance with ifrss as adopted 
by the eu and applicable law and have elected to prepare the company financial statements on the same basis 
under company law the directors must not approve the financial statements unless they are satisfied that they give 
a true and fair view of the state of affairs of the group and the company and of their profit or loss for that period in 
preparing each of the group and company financial statements the directors are required to
•	 select	suitable	accounting	policies	and	then	apply	them	consistently
•	 make	judgements	and	accounting	estimates	that	ar e	r easonable	and	prudent
•	 state	whether	they	have	been	pr epar ed	in	accor dance	with	ifrss	as	adopted	by	the	eu	and
•	 	 pr epar e	the	financial	statements	on	the	going	concer n	basis	unless	it	is	inappr opriate	to	pr esume	that	the	gr oup	
and company will continue in business
the directors are responsible for keeping adequate accounting records that are sufficient to show and explain the 
company’s transactions and disclose with reasonable accuracy at any time the financial position of the company 
and the group and enable them to ensure that the financial statements and the directors’ remuneration report 
comply with the companies act 2006 they have general responsibility for taking such steps as are reasonably 
open to them to safeguard the assets of the group and to prevent and detect fraud and other irregularities 
under applicable law and regulations the directors are also responsible for preparing a directors’ report directors’ 
remuneration report and corporate governance statement that complies with that law and those regulations 
the directors are responsible for the maintenance and integrity of the corporate and financial information included 
on the company’s website legislation in the united kingdom governing the preparation and dissemination of 
financial statements may differ from legislation in other jurisdictions
independent auditors’ report to the members of pace plc
we have audited the financial statements of pace plc for the year ended 31 december 2011 set out on pages 35 
to 77
the financial reporting framework that has been applied in their preparation is applicable law and international 
financial reporting standards ifrss as adopted by the eu and as regards the parent company financial 
statements as applied in accordance with the provisions of the companies act 2006 
this report is made solely to the company’s members as a body in accordance with chapter 3 of part 16 of the 
companies act 2006 our audit work has been undertaken so that we might state to the company’s members 
those matters we are required to state to them in an auditor’s report and for no other purpose to the fullest 
extent permitted by law we do not accept or assume responsibility to anyone other than the company and the 
company’s members as a body for our audit work for this report or for the opinions we have formed
respective responsibilities of directors and auditor
as explained more fully in the directors’ responsibilities statement set out on page 31 the directors are 
responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view 
our responsibility is to audit and express an opinion on the financial statements in accordance with applicable 
law and international standards on auditing uk and ireland those standards require us to comply with the 
auditing practices board’s apb’s ethical standards for auditors
scope of the audit of the financial statements
a description of the scope of an audit of financial statements is provided on the apb’s website at  
wwwfrcorgukapbscopeukp 
opinion on financial statements
in our opinion
•	 	 the	financial	statements	give	a	true	and	fair	view	of	the	state	of	the	gr oup’ s	and	of	the	par ent	company’ s	af fairs	
as at 31 december 2011 and of the group’s profit for the year then ended
•	 the	gr oup	financial	statements	have	been	pr operly	pr epar ed	in	accor dance	with	ifrss	as	adopted	by	the	eu	
•	 	 the	par ent	company	financial	statements	have	been	pr operly	pr epar ed	in	accor dance	with	ifrss	as	adopted	by	
the eu and as applied in accordance with the provisions of the companies act 2006 and 
•	 	 the	financial	statements	have	been	pr epar ed	in	accor dance	with	the	r equir ements	of	the	companies	act	2006	
and as regards the group financial statements article 4 of the ias regulation
opinion on other matters prescribed by the companies act 2006
in our opinion
•	 	 the	part	of	the	dir ectors’	remuneration	report	to	be	audited	has	been	pr operly	pr epar ed	in	accor dance	with	the	
companies act 2006 and
•	 	 the	information	given	in	the	dir ectors’	report	for	the	financial	year	for	which	the	financial	statements	ar e 	pr epar ed	
is consistent with the financial statements
matters on which we are required to report by exception
we have nothing to report in respect of the following
under the companies act 2006 we are required to report to you if in our opinion
•	 	 adequate	accounting	r ecor ds	have	not	been	kept	by	the	par ent	company 	or	r etur ns	adequate	for	our	audit	have	
not been received from branches not visited by us or
•	 	 the	par ent	company	financial	statements	and	the	part	of	the	dir ectors’	remuneration	report	to	be	audited	ar e	
not in agreement with the accounting records and returns or
•	 certain	disclosur es	of	dir ectors’	r emuneration	specified	by	law	ar e	not	made	or
•	 we	have	not	r eceived	all	the	information	and	explanations	we	r equir e	for	our	audit	
statement of
directors’ responsibilities
independent
auditors’ report
front end 2011 v10indd   3233 16032012   1125 pace plc 2011 annual report    32 31    pace plc 2011 annual report
statement of directors’ responsibilities
the directors are responsible for preparing the annual report and accounts and the group and company financial 
statements in accordance with applicable law and regulations
company law requires the directors to prepare group and company financial statements for each financial year 
under that law they are required to prepare the group financial statements in accordance with ifrss as adopted 
by the eu and applicable law and have elected to prepare the company financial statements on the same basis 
under company law the directors must not approve the financial statements unless they are satisfied that they give 
a true and fair view of the state of affairs of the group and the company and of their profit or loss for that period in 
preparing each of the group and company financial statements the directors are required to
•	 select	suitable	accounting	policies	and	then	apply	them	consistently
•	 make	judgements	and	accounting	estimates	that	ar e	r easonable	and	prudent
•	 state	whether	they	have	been	pr epar ed	in	accor dance	with	ifrss	as	adopted	by	the	eu	and
•	 	 pr epar e	the	financial	statements	on	the	going	concer n	basis	unless	it	is	inappr opriate	to	pr esume	that	the	gr oup	
and company will continue in business
the directors are responsible for keeping adequate accounting records that are sufficient to show and explain the 
company’s transactions and disclose with reasonable accuracy at any time the financial position of the company 
and the group and enable them to ensure that the financial statements and the directors’ remuneration report 
comply with the companies act 2006 they have general responsibility for taking such steps as are reasonably 
open to them to safeguard the assets of the group and to prevent and detect fraud and other irregularities 
under applicable law and regulations the directors are also responsible for preparing a directors’ report directors’ 
remuneration report and corporate governance statement that complies with that law and those regulations 
the directors are responsible for the maintenance and integrity of the corporate and financial information included 
on the company’s website legislation in the united kingdom governing the preparation and dissemination of 
financial statements may differ from legislation in other jurisdictions
independent auditors’ report to the members of pace plc
we have audited the financial statements of pace plc for the year ended 31 december 2011 set out on pages 35 
to 77
the financial reporting framework that has been applied in their preparation is applicable law and international 
financial reporting standards ifrss as adopted by the eu and as regards the parent company financial 
statements as applied in accordance with the provisions of the companies act 2006 
this report is made solely to the company’s members as a body in accordance with chapter 3 of part 16 of the 
companies act 2006 our audit work has been undertaken so that we might state to the company’s members 
those matters we are required to state to them in an auditor’s report and for no other purpose to the fullest 
extent permitted by law we do not accept or assume responsibility to anyone other than the company and the 
company’s members as a body for our audit work for this report or for the opinions we have formed
respective responsibilities of directors and auditor
as explained more fully in the directors’ responsibilities statement set out on page 31 the directors are 
responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view 
our responsibility is to audit and express an opinion on the financial statements in accordance with applicable 
law and international standards on auditing uk and ireland those standards require us to comply with the 
auditing practices board’s apb’s ethical standards for auditors
scope of the audit of the financial statements
a description of the scope of an audit of financial statements is provided on the apb’s website at  
wwwfrcorgukapbscopeukp 
opinion on financial statements
in our opinion
•	 	 the	financial	statements	give	a	true	and	fair	view	of	the	state	of	the	gr oup’ s	and	of	the	par ent 	company’ s	af fairs	
as at 31 december 2011 and of the group’s profit for the year then ended
•	 the	gr oup	financial	statements	have	been	pr operly	pr epar ed	in	accor dance	with	ifrss	as	adopted	by	the	eu	
•	 	 the	par ent	company	financial	statements	have	been	pr operly	pr epar ed	in	accor dance	with	ifrss	as	adopted	by	
the eu and as applied in accordance with the provisions of the companies act 2006 and 
•	 	 the	financial	statements	have	been	pr epar ed	in	accor dance	with	the	r equir ements	of	the	companies	act	2006	
and as regards the group financial statements article 4 of the ias regulation
opinion on other matters prescribed by the companies act 2006
in our opinion
•	 	 the	part	of	the	dir ectors’	remuneration	report	to	be	audited	has	been	pr operly	pr epar ed	in	accor dance	with	the	
companies act 2006 and
•	 	 the	information	given	in	the	dir ectors’	report	for	the	financial	year	for	which	the	financial	statements	ar e	pr epar ed	
is consistent with the financial statements
matters on which we are required to report by exception
we have nothing to report in respect of the following
under the companies act 2006 we are required to report to you if in our opinion
•	 	 adequate	accounting	r ecor ds	have	not	been	kept	by	the	par ent	company 	or	r etur ns	adequate	for	our	audit	have	
not been received from branches not visited by us or
•	 	 the	par ent	company	financial	statements	and	the	part	of	the	dir ectors’	remuneration	report	to	be	audited	ar e 	
not in agreement with the accounting records and returns or
•	 certain	disclosur es	of	dir ectors’	r emuneration	specified	by	law	ar e	not	made	or
•	 we	have	not	r eceived	all	the	information	and	explanations	we	r equir e	for	our	audit	
statement of
directors’ responsibilities
independent
auditors’ report
front end 2011 v10indd 3233 16032012 1125 under the listing rules we are required to review
•	 the	dir ectors’	statement	set	out	on	page	18	in	r elation	to	going	concer n
•	 	 the	part	of	the	corporate	gover nance	statement	in	the	report	of	the	dir ectors	r elating	to	the	company’ s	
compliance with the nine provisions of the uk corporate governance code specified for our review and
•	 certain	elements	of	the	r eport	to	shar eholders	by	the	boar d	on	dir ectors’	r emuneration	
chris hearld senior statutory auditor 
for and on behalf of kpmg audit plc statutory auditor 
chartered accountants  
1 the embankment  
neville street  
leeds 
ls1 4dw
6 march 2012
pace plc 2011 annual report    34 33    pace plc 2011 annual report
independent
auditors’ report continued
35 financial statements
42 notes to the financial statements
78 directors secretary and advisers
79 five year record and shareholder information
financial statements
contents
front end 2011 v10indd   3435 16032012   1125 under the listing rules we are required to review
•	 the	dir ectors’	statement	set	out	on	page	18	in	r elation	to	going	concer n
•	 	 the	part	of	the	corporate	gover nance	statement	in	the	report	of	the	dir ectors	r elating	to	the	company’ s	
compliance with the nine provisions of the uk corporate governance code specified for our review and
•	 certain	elements	of	the	r eport	to	shar eholders	by	the	boar d	on	dir ectors’	r emuneration	
chris hearld senior statutory auditor 
for and on behalf of kpmg audit plc statutory auditor 
chartered accountants  
1 the embankment  
neville street  
leeds 
ls1 4dw
6 march 2012
pace plc 2011 annual report    34 33    pace plc 2011 annual report
independent
auditors’ report continued
35 financial statements
42 notes to the financial statements
78 directors secretary and advisers
79 five year record and shareholder information
financial statements
contents
front end 2011 v10indd 3435 16032012 1125 35    pace plc  2011 annual report
consolidated income statement
for the year ended 31 december 2011
   restated
  2011 2010
 notes m m
revenue 3 23093 20629
cost of sales   18660 16678
gross proﬁ t  4433 3951
   
administrative expenses   
  research and development expenditure 4 1606 1200
  other administrative expenses   
     before exceptional costs 4 1413 1145
     exceptional costs 5 127 295
  amortisation of intangibles 11 557 181
total administrative expenses  3703 2821
   
operating proﬁ t  730 1130
finance income – interest receivable 6 02 12
finance expenses – interest payable 6 185 40
proﬁ t before tax  547 1102
tax charge 8 159 329
proﬁ t for the year  388 773
   
proﬁ t attributable to   
equity holders of the company  388 773
   
earnings per ordinary share   
basic earnings per ordinary share cents 9 132 264
diluted earnings per ordinary share cents 9 125 250
pace ra 2012indd 35 12032012 1455 pace plc  2011 annual report    36
  restated
 2011 2010
  m m
proﬁ t for the year 388 773
other comprehensive income  
exchange differences on translating foreign operations 81 33
exchange differences on change in presentational currency  118
net change in fair value of cash ﬂ ow hedges transferred to proﬁ t or loss gross of tax 150 194
deferred tax adjustment on above  40 62
effective portion of changes in fair value of cash ﬂ ow hedges gross of tax 81 141
deferred tax adjustment on above 22 47
other comprehensive income for the year net of tax 30 123
total comprehensive income for the year 358 650
  
attributable to  
equity holders of the company 358 650
consolidated statement of comprehensive income
for the year ended 31 december 2011
pace ra 2012indd 36 12032012 1455 37    pace plc  2011 annual report
   restated restated
  2011  2010 1 jan 2010
 notes m m m
assets    
noncurrent assets    
property plant and equipment 12 630 527 316
intangible assets – goodwill 11 3356 3356 1133
intangible assets – other intangibles 11 2180 2737 225
intangible assets – development expenditure 11 539 446 462
deferred tax assets 14 672 699 103
total noncurrent assets  7377 7765 2239
current assets    
inventories 15 1500 2227 1402
trade and other receivables 16 4023 4334 3408
cash and cash equivalents 18 487 1314 1183
current tax assets  46 19 42
total current assets  6056 7894 6035
total assets  13433 15659 8274
    
equity    
issued capital 21 283 282 282
share premium 22 731 726 715
merger reserve 23 1099 1099 1099
hedging reserve  29 22 16
translation reserve  521 440 355
retained earnings 24 2450 2114 1402
total equity  4071 3759 3159
liabilities    
noncurrent liabilities    
other payables   62 37
deferred tax liabilities 14 957 1085 237
provisions 20 416 439 311
borrowings 18 1473 2198 
total noncurrent liabilities  2846 3784 585
current liabilities    
trade and other payables 17 3735 5384 4228
current tax liabilities  96 76 69
provisions 20 454 429 233
borrowings 18 2231 2227 
total current liabilities  6516 8116 4530
total liabilities  9362 11900 5115
total equity and liabilities  13433 15659 8274
these ﬁ nancial statements were approved by the board of directors on 6 march 2012 and were signed on its behalf by
michael pulli   chief executive ofﬁ cer
stuart hall       chief financial ofﬁ cer 
consolidated balance sheet
at 31 december 2011
pace ra 2012indd 37 12032012 1455 pace plc  2011 annual report    38
   restated restated
  2011  2010 1 jan 2010
 notes m m m
assets    
noncurrent assets   
property plant and equipment 12 295 246 198
intangible assets – development expenditure 11 359 291 267
investments in group and other companies 13 4486 3545 1141
loans to group companies 13 1906 1972 55
deferred tax assets 14 22 42 52
total noncurrent assets  7068 6096 1713
current assets    
inventories 15 493 329 346
trade and other receivables 16 4367 3923 3220
cash and cash equivalents  138 778 424
current tax assets  20  42
total current assets  5018 5030 4032
total assets  12086 11126 5745
    
equity    
issued capital 21 283 282 282
share premium 22 731 726 715
merger reserve 23 1099 1099 1099
hedging reserve  28 53 09
translation reserve  525 503 404
retained earnings 24 2358 1337 953
total equity  3974 2888 2636
liabilities    
noncurrent liabilities    
other payables    35
deferred tax liabilities 14 58 62 56
provisions 20 232 380 225
borrowings 18 1473 2198 
total noncurrent liabilities  1763 2640 316
current liabilities    
trade and other payables 17 3851 3143 2684
current tax liabilities  17 71 
provisions 20 250 157 109
borrowings 18 2231 2227 
total current liabilities  6349 5598 2793
total liabilities  8112 8238 3109
total equity and liabilities  12086 11126 5745
these ﬁ nancial statements were approved by the board of directors on 6 march 2012 and were signed on its behalf by
michael pulli   chief executive ofﬁ cer
stuart hall      chief financial ofﬁ cer
pace plc
registered number 01672847
company balance sheet
at 31 december 2011
pace ra 2012indd 38 12032012 1455 39    pace plc  2011 annual report
 share share merger hedging translation retained total
 capital premium  reserve  reserve reserve earnings equity
group m m m m m m m
balance at january 2010 restated 282 715 1099 16 355 1402 3159
proﬁ t for the year      773 773
other comprehensive income    38 85  123
total comprehensive income for the year    38 85 773 650
transactions with owners       
deferred tax on share options      22 22
dividends to equity shareholders      80 80
employee share incentive charges      94 94
movement in employee share trusts      53 53
issue of shares  11     11
balance at december 2010 restated 282 726 1099 22 440 2114 3759
proﬁ t for the year      388 388
other comprehensive income    51 81  30
total comprehensive income for the year    51 81 388 358
transactions with owners       
deferred tax on share options      29 29
dividends to equity shareholders      101 101
employee share incentive charges      78 78
issue of shares 01 05     06
balance at december 2011 283 731 1099 29 521 2450 4071
 share share merger hedging translation retained total
 capital premium  reserve  reserve reserve earnings equity
company m m m m m m m
balance at january 2010 restated 282 715 1099 09 404 953 2636
proﬁ t for the year      445 445
other comprehensive income    44 99  143
total comprehensive income for the year    44 99 445 302
transactions with owners       
deferred tax on share options      22 22
dividends to equity shareholders      80 80
employee share incentive charges      94 94
movement in employee share trusts      53 53
issue of shares  11     11
balance at december 2010 restated 282 726 1099 53 503 1337 2888
proﬁ t for the year      1073 1073
other comprehensive income    81  22  59
total comprehensive income for the year    81 22 1073 1132
transactions with owners       
deferred tax on share options      29 29
dividends to equity shareholders      101 101
employee share incentive charges      78 78
issue of shares 01 05     06
balance at december 2011 283 731 1099  28 525 2358 3974
statements of changes in shareholders’ equity
pace ra 2012indd 39 12032012 1455 pace plc  2011 annual report    40
  restated
 2011 2010
 m m
cash ﬂ ows from operating activities  
proﬁ t before tax 547 1102
adjustments for  
  share based payments charge 78 94
  depreciation of property plant and equipment 290 163
  amortisation of development expenditure 479 520
  amortisation of other intangibles 557 181
  loss on sale of property plant and equipment 16 05
  net ﬁ nance expense 183 28
  movement in trade and other receivables 303 156
  movement in trade and other payables 1702 234
  movement in inventories 722 322
  movement in provisions 27 03
cash generated from operations 1500 1378
interest paid 138 28
tax paid 297 392
net cash generated from operating activities 1065 958
cash ﬂ ows from investing activities  
acquisition of subsidiaries net of cash acquired 64 4224
purchase of property plant and equipment 415 305
development expenditure 570 569
interest received 02 12
net cash used in investing activities 1047 5086
cash ﬂ ows from ﬁ nancing activities  
proceeds from external borrowings  4425
repayment of longterm debt 750 
proceeds from issue of share capital 06 11
dividend paid 101 80
purchase of own shares by employee beneﬁ t trust  53
net cash used in  generated from ﬁ nancing activities 845 4303
net change in cash and cash equivalents  827 175
cash and cash equivalents at the start of the year 1314 1183
effect of exchange rate ﬂ uctuations on cash held  44
cash and cash equivalents at the end of the year 487 1314
consolidated statement of cash flows
for the year ended 31 december 2011
pace ra 2012indd 40 12032012 1455 41    pace plc  2011 annual report
  restated
 2011 2010
 m m
cash ﬂ ows from operating activities  
proﬁ t before tax 1140 636
adjustments for  
  share based payments charge 78 94
  depreciation of property plant and equipment 108 88
  loss on sale of property plant and equipment 01 
  amortisation of development expenditure 274 329
  net ﬁ nance expense  91 08
  movement in trade and other receivables 415 2010
  movement in trade and other payables 818 265
  movement in inventories 157 05
  movement in provisions 48 211
cash generated from  used in operations 1890 904
interest paid 119 14
tax paid 164 88
net cash generated from  used in operating activities 1607 1006
cash ﬂ ows from investing activities  
acquisition of subsidiaries net of cash acquired 977 2434
purchase of property plant and equipment 158 135
development expenditure 342 363
interest received 75 06
net cash used in investing activities 1402 2926
cash ﬂ ows from ﬁ nancing activities  
proceeds from external borrowings  4425
repayment of longterm debt 750 
proceeds from issue of share capital 06 11
dividend paid 101 81
purchase of own shares by employee beneﬁ t trust  53
net cash used in  generated from ﬁ nancing activities 845 4302
net change in cash and cash equivalents  640 370
cash and cash equivalents at the start of the year 778 424
effect of exchange rate ﬂ uctuations on cash held  16
cash and cash equivalents at the end of the year 138 778
company statement of cash flows
for the year ended 31 december 2011
pace ra 2012indd 41 12032012 1455 pace plc  2011 annual report    42
1  basis of preparation and business environment
the following accounting policies have been applied consistently in dealing with items which are considered material in relation to 
the ﬁ nancial statements
basis of preparation
the ﬁ nancial statements have been prepared in accordance with applicable accounting standards and under the historical cost 
convention as modiﬁ ed by the revaluation of derivative instruments
international financial reporting standards
the group’s ﬁ nancial statements have been prepared in accordance with international financial reporting standards “ifrs” as 
endorsed by the european union and international financial reporting interpretations committee “ifric” interpretations and with 
those parts of the companies act 2006 applicable to companies reporting under ifrs the company’s financial statements have 
been prepared on the same basis and as permitted by section 408 of the companies act 2006 no income statement is presented 
for the company the result of the company for the year is shown in note 25
financial year end
the current year’s ﬁ nancial statements are for the year ended 31 december 2011 and the previous year’s ﬁ nancial statements are 
for the year ended 31 december 2010
basis of consolidation
the group ﬁ nancial statements consolidate those of the company and of its subsidiary undertakings note 13 drawn up to 31 
december 2011 subsidiaries are entities controlled by the company control exists when the company has the power directly or 
indirectly to govern the ﬁ nancial and operating policies of an entity so as to obtain beneﬁ ts from its activities in assessing control 
potential voting rights that presently are exercisable or convertible are taken into account intragroup transactions including sales 
proﬁ ts receivables and payables have been eliminated on the group consolidation investments in subsidiaries are carried at cost 
less any impairment loss in the ﬁ nancial statements of the company
change in functional currency
ias 21 ‘the effects of changes in foreign exchange rates’ describes functional currency as “the currency of the primary 
economic environment in which an entity operates” the group and company incur and source a signiﬁ cant majority of revenues 
and costs in us dollars
a change in functional currency reﬂ ects the accumulation over time of those factors which are the main determinants of functional 
currency having considered the aggregate effect of all relevant factors the directors concluded that this point was reached in 
the ﬁ rst quarter of 2011 following the integration of 2wire inc into the pace group accordingly the directors determined that the 
functional currency of pace plc had changed to usd from 1 january 2011
in accordance with ias 21 this change has been accounted for prospectively from this date
change in presentation currency
from 1 january 2011 the group also changed its presentation currency to usd comparative information has been restated in usd 
in accordance with the guidance deﬁ ned in ias 21 the 2010 ﬁ nancial statements and associated notes have been retranslated 
from sterling to usd using the procedures outlined below
• assets and liabilities were translated into usd at closing rates of exchange at 31 december 2010 and opening rates of 
exchange at 1 january 2010
• t rading results were translated into usd at the rates of exchange prevailing at the dates of transaction or average rates where 
they are a suitable proxy
• share capital share premium and other capital reserves were translated at the historic rates prevailing at the dates of 
transactions
• differences resulting from the retranslation of the opening net assets and the results for the year have been taken to reserves
signiﬁ cant judgements key assumptions and estimation uncertainty
the group’s main accounting policies affecting its results of operations and ﬁ nancial condition are set out on pages 43 to 49 
judgements and assumptions have been required by management in applying the group’s accounting policies in many areas 
actual results may differ from the estimates calculated using these judgements and assumptions key areas of estimation 
uncertainty and critical accounting judgements are as follows
notes
pace ra 2012indd 42 12032012 1455 43    pace plc  2011 annual report
1  basis of preparation and business environment continued
warranties
pace provides product warranties for its products although it is difﬁ cult to make accurate predictions of potential failure rates or the 
possibility of an epidemic failure as a warranty estimate must be calculated at the outset of a product before ﬁ eld deployment data 
is available these estimates improve during the lifetime of the product in the ﬁ eld
a provision for warranties is recognised when the underlying products are sold the provision is based on historical warranty data 
and a weighting of all possible outcomes against their associated probabilities the level of warranty provision required is reviewed 
on a product by product basis and provisions adjusted accordingly in the light of actual performance
royalties
pace’s products incorporate third party technology usually under licence inadvertent actions may expose pace to the risk of 
infringing third party intellectual property rights potential claims can still be submitted many years after a product has been 
deployed any such claims are always vigorously defended
a provision for royalties is recognised where the owners of patents covering technology allegedly used by the group have indicated 
claims for royalties relating to the group’s use including past usage of that technology having taken legal advice the board 
considers that there are defences available that should mitigate the amounts being sought the group will vigorously negotiate or 
defend all claims but in the absence of agreement the amounts provided may prove to be different from the amounts at which the 
potential liabilities are ﬁ nally settled the provision is based on the latest information available
operating segments
operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker 
the chief operating decision maker who is responsible for allocating resources and assessing performance of the operating 
segments has been identiﬁ ed as the board of directors the board of directors has determined that based on its current internal 
reporting framework and management structure it has three reportable segments 
such determination is necessarily judgmental in its nature and has been determined for the preparation of the ﬁ nancial statements 
the level of disclosure of segmental and other information is determined by such assessment further details of the considerations 
made and the resulting disclosures are provided in note 3 to the ﬁ nancial statements
intangible assets
the group’s business includes a signiﬁ cant element of research and development activity  under accounting standards principally 
ias 38 ‘intangible assets’ there is a requirement to capitalise and amortise development spend to match costs to expected beneﬁ ts 
from projects deemed to be commercially viable  the application of this policy involves the ongoing consideration by management 
of the forecasted economic beneﬁ t from such projects compared to the level of capitalised costs together with the selection of 
amortisation periods appropriate to the life of the associated revenues from the product 
going concern
the group has borrowing facilities in place until march 2014 at 31 december 2011 these are in the form of a 225m term loan 
which is subject to repayment through instalments of 375m each due every six months plus a ﬁ nal payment of 75m and a 
150m revolver credit facility these facilities are subject to ﬁ nancial performance covenants which the group currently complies 
with
the group has prepared a ﬁ nancial and working capital forecast based upon trading assumptions and other short term and medium 
term plans the group has sensitised these plans for a number of potential scenarios including working capital management 
and revenue reduction and has concluded that the group will continue to meet its ﬁ nancial performance covenants and will have 
adequate working capital available to continue in operational existence for the foreseeable future
2   accounting policies
business combinations
control is the power to govern the ﬁ nancial and operating policies of an entity so as to obtain beneﬁ ts from its activities in assessing 
control the group takes into consideration potential voting rights that currently are exercisable the acquisition date is the date 
on which control is transferred to the acquirer judgement is applied in determining the acquisition date and determining whether 
control is transferred from one party to another
goodwill
goodwill that arises upon the acquisition of subsidiaries is included in intangible assets
notes
continued
pace ra 2012indd 43 12032012 1455 pace plc  2011 annual report    44
2   accounting policies continued 
initial measurement
the group measures goodwill as the fair value of the consideration transferred including the recognised amount of any non
controlling interest in the acquiree less the net recognised amount generally fair value of the identiﬁ able assets acquired and 
liabilities assumed all measured as of the acquisition date consideration transferred includes the fair values of the assets 
transferred liabilities incurred by the group to the previous owners of the acquiree and equity interests issued by the group 
consideration transferred also includes the fair value of any contingent consideration and sharebased payment awards of 
the acquiree that are replaced mandatorily in the business combination if a business combination results in the termination of 
preexisting relationships between the group and the acquiree then the lower of the termination amount as contained in the 
agreement and the value of the offmarket element is deducted from the consideration transferred and recognised in other 
expenses
a contingent liability of the acquiree is assumed in a business combination only if such a liability represents a present obligation and 
arises from a past event and its fair value can be measured reliably
the group measures any noncontrolling interest at its proportionate interest in the identiﬁ able net assets of the acquiree 
transaction costs that the group incurs in connection with a business combination such as ﬁ nder’ s fees legal fees due diligence 
fees and other professional and consulting fees are expensed as incurred
subsequent measurement
goodwill is measured at cost less accumulated impairment losses in respect of equity accounted investees the carrying amount of 
goodwill is included in the carrying amount of the investment and an impairment loss on such an investment is not allocated to any 
asset including goodwill that forms part of the carrying amount of the equity accounted investee
as permitted by ifrs 1 ‘firsttime adoption of ifrs’ goodwill arising on acquisitions before 29 may 2004 date of transition to 
adopted ifrs has been frozen at the uk gaap amounts subject to being tested for impairment annually the group performs its 
annual impairment review at the cashgenerating unit level
other intangibles
other intangible assets that are acquired by the group which have ﬁ nite useful lives are measured at cost less accumulated 
amortisation and accumulated impairment losses
amortisation of other intangibles is done on a straight line basis over the estimated useful economic lives of the particular asset 
categories as follows
 customer contracts and relationships 310 years
 technology and patents 110 years
 other 3 years
 
research and development expenditure
all ongoing research expenditure is expensed in the period in which it is incurred where a product is technically feasible 
production and sales are intended a market exists and sufﬁ cient resources are available to complete the project development 
costs are capitalised and subsequently amortised on a straightline basis over the estimated useful life of the product concerned 
from commercial launch the expenditure capitalised includes the cost of materials direct labour and an appropriate proportion 
of overheads where these conditions are not met development expenditure is recognised as an expense in the period in which 
it is incurred capitalised development expenditure is stated at cost less accumulated amortisation and impairment losses the 
estimated useful lives for development expenditure are estimated to be in a range of between 6 and 18 months
capitalised development expenditure is not treated as a realised loss for the purpose of determining the company’s distributable 
proﬁ ts as the costs meet the conditions required to be treated as an asset in accordance with ias 38
the amortisation of capitalised development expenditure is charged to the income statement in research and development 
expenditure within the administrative expenses category 
impairment charges
the carrying amounts of the group’s nonﬁ nancial assets other than inventories and deferred tax assets are reviewed at each 
reporting date to determine whether there is any indication of impairment if any such indication exists then the asset’s recoverable 
amount is estimated for goodwill and intangible assets that have indeﬁ nite useful lives or that are not yet available for use the 
recoverable amount is estimated each year at the same time an impairment loss is recognised if the carrying amount of an asset or 
its related cashgenerating unit cgu exceeds its estimated recoverable amount
notes
continued
pace ra 2012indd 44 12032012 1455 45    pace plc  2011 annual report
2   accounting policies continued 
the recoverable amount of an asset or cgu is the greater of its value in use and its fair value less costs to sell in assessing value in 
use the estimated future cash ﬂ ows are discounted to their present value using a pretax discount rate that reﬂ ects current market 
assessments of the time value of money and the risks speciﬁ c to the asset or cgu for the purpose of impairment testing cgus to 
which goodwill has been allocated are aggregated so that the level at which impairment testing is performed reﬂ ects the lowest level 
at which goodwill is monitored for internal reporting purposes goodwill acquired in a business combination is allocated to groups of 
cgus that are expected to beneﬁ t from the synergies of the combination
the group’s corporate assets do not generate separate cash inﬂ ows and are utilised by more than one cgu corporate assets 
are allocated to cgus on a reasonable and consistent basis and tested for impairment as part of the testing of the cgu to which 
the corporate asset is allocated impairment losses are recognised in proﬁ t or loss any impairment losses recognised in respect 
of cgus are allocated ﬁ rst to reduce the carrying amount of any goodwill allocated to the cgu and then to reduce the carrying 
amounts of the assets in the cgu on a pro rata basis
an impairment loss in respect of goodwill is not reversed in respect of other assets impairment losses recognised in prior periods 
are assessed at each reporting date for any indications that the loss has decreased or no longer exists an impairment loss is 
reversed if there has been a change in the estimates used to determine the recoverable amount an impairment loss is reversed 
only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined net of 
depreciation or amortisation if no impairment loss had been recognised
exceptional items
items which are signiﬁ cant by virtue of their size or nature and which are considered nonrecurring are classiﬁ ed as exceptional 
operating items such items which include for instance the costs of opening or closing premises costs of signiﬁ cant restructurings 
and proﬁ ts and losses made on the disposal of properties are included within the appropriate consolidated income statement 
category albeit analysed as a separate line within that category and are highlighted separately in the notes to the ﬁ nancial statements 
exceptional operating items are excluded from the proﬁ t measures used by the board to monitor underlying performance
revenue recognition
revenue comprises the value of sales of goods and services to third party customers occurring in the period stated exclusive of 
value added tax and net of trade discounts and rebates
revenue on the sale of goods is recognised when substantially all of the risks and rewards in the product have passed to the 
customer and substantially all of the group’s work is completed which is usually upon delivery to the customer or his agent
revenue in respect of services rendered including engineering consultancy and support and software services is recognised over 
the period over which they are performed in relation to the level of work undertaken project milestones achieved and any future 
obligations remaining
when a single sales transaction requires the delivery of more than one product or service multiple components the revenue 
recognition criteria are applied to the separately identiﬁ able components a component is considered to be separately identiﬁ able if 
the product or service delivered has standalone value to that customer and the fair value associated with the product or service can 
be measured reliably the amount recognised as revenue for each component is the fair value of the element in relation to the fair 
value of the arrangement as a whole this requires a degree of management judgement and the fair value allocations are by their 
nature best estimates the timing and amount of revenue recognition can vary depending on what assessments have been made 
where there is no separate selling price of an element management determine fair value based on equivalent available products
the group does not recognise revenue before delivery has occurred the risks and rewards of ownership have been transferred 
to the customer the amount of revenue can be measured reliably and collection of the related receivable is reasonably assured 
the determination of whether the amount of revenue can be measured reliably or whether receivables are collectible is inherently 
judgemental
finance income and ﬁ nance costs
finance income comprises interest income on funds invested and dividend income interest income is recognised as it accrues in 
proﬁ t or loss using the effective interest method
finance costs comprise interest expense on borrowings and impairment losses recognised on ﬁ nancial assets borrowing costs that 
are not directly attributable to the acquisition construction or production of a qualifying asset are recognised in proﬁ t or loss using 
the effective interest method
foreign currency gains and losses are reported on a net basis
notes
continued
pace ra 2012indd 45 12032012 1455 pace plc  2011 annual report    46
2   accounting policies continued 
government grants
grants in respect of speciﬁ c research and development projects are credited to research and development costs within the income 
statement or against the capitalised development expenditure as appropriate to match to the project’s related expenditure
cash and cash equivalents
cash and cash equivalents comprise cash balances and call deposits the company considers all highly liquid investments with 
original maturity dates of three months or less to be cash equivalents bank overdrafts that are repayable on demand and form an 
integral part of the group’s cash management system are included as a component of cash and cash equivalents for the purpose of 
the statement of cash ﬂ ows
allowance for doubtful debts
trade receivables are assessed individually for impairment or collectively where the receivables are not individually signiﬁ cant where 
necessary provisions for doubtful debts are recorded in the income statement 
inventory
inventory is stated at the lower of cost and net realisable value cost is determined on a ﬁ rstinﬁ rstout basis and includes 
appropriate transport and handling costs but excludes royalties due only on ultimate sale where necessary provision is made for 
obsolete slowmoving and defective inventory
property plant and equipment
the cost of items of property plant and equipment is its purchase cost together with any incidental costs of acquisition  
depreciation is calculated so as to write off on a straightline basis over the expected useful economic lives of the asset concerned 
the cost of property plant and equipment less any estimated residual values which are adjusted if appropriate at each balance 
sheet date the principal economic lives used for this purpose are
 long leasehold properties period of lease
 short leasehold properties period of lease
 plant and machinery 110 years
 motor vehicles 4 years
provision is made against the carrying value of items of property plant and equipment where an impairment in value is deemed to 
have occurred 
leased assets
leases in terms of which the group assumes substantially all the risks and rewards of ownership are classiﬁ ed as ﬁ nance leases 
assets held under ﬁ nance leases and hire purchase contracts are capitalised in the balance sheet and depreciated over their 
expected useful lives the interest element of leasing payments represents a constant proportion of the capital balance outstanding 
and is charged to the income statement over the period of the lease
all other leases are regarded as operating leases and the payments made under them are charged to the income statement on a 
straightline basis over the lease term
foreign currency
transactions in foreign currencies are translated to the respective functional currencies of group entities at the foreign exchange 
rate ruling at the date of the transaction monetary assets and liabilities denominated in foreign currencies at the balance sheet date 
are retranslated to the functional currency at the foreign exchange rate ruling at that date foreign exchange differences arising on 
translation are recognised in the income statement nonmonetary assets and liabilities that are measured in terms of historical 
cost in a foreign currency are translated using the exchange rate at the date of the transaction nonmonetary assets and liabilities 
denominated in foreign currencies that are stated at fair value are retranslated to the functional currency at foreign exchange rates 
ruling at the dates the fair value was determined
the assets and liabilities of foreign operations including goodwill and fair value adjustments arising on consolidation are translated 
to the group’s presentational currency at foreign exchange rates ruling at the balance sheet date the revenues and expenses of 
foreign operations are translated at an average rate for the year where this rate approximates to the foreign exchange rates 
ruling at the dates of the transactions exchange differences arising from this translation of foreign operations are taken directly to 
notes
continued
pace ra 2012indd 46 12032012 1455 47    pace plc  2011 annual report
2  accounting policies continued 
the translation reserve when a foreign operation is disposed of such that control is lost the cumulative amount in the translation 
reserve is reclassiﬁ ed to the income statement as part of the gain or loss on disposal
derivative ﬁ nancial instruments
the group uses derivative ﬁ nancial instruments usually forward foreign exchange contracts to hedge its exposure to foreign 
exchange risks arising from operational ﬁ nancing and investment activities in accordance with its treasury policy the group does 
not hold or issue derivative ﬁ nancial instruments for trading purposes the directors have determined that the instruments qualify for 
cash ﬂ ow hedge accounting
derivative ﬁ nancial instruments are classiﬁ ed as cashﬂ ow hedges when they hedge the group’s exposure to variability in cash ﬂ ows 
that are either attributable to a particular risk associated with a recognised asset or liability or a highly probable forecast transaction
derivatives are reviewed quarterly for effectiveness where a derivative ﬁ nancial instrument is designated as a hedge of the variability 
in cash ﬂ ows of a recognised asset or liability or highly probable forecast transaction the effective part of any gain or loss on the 
movement in fair value of the derivative ﬁ nancial instrument is recognised directly in equity
the gain or loss on any ineffective part of the hedge is immediately recognised in the income statement within ﬁ nance incomecosts 
if a hedge of a forecast transaction subsequently results in the recognition of a ﬁ nancial asset or liability the associated cumulative 
gains or losses that were recognised directly in equity are reclassiﬁ ed into the income statement when the transaction occurs
taxes
current tax including uk corporation tax and foreign tax is provided at amounts expected to be paid or recovered using the tax 
rates that have been enacted or substantively enacted by the balance sheet date
deferred tax is provided using the balance sheet liability method providing where relevant for temporary differences between the 
carrying amounts of assets and liabilities for ﬁ nancial reporting purposes and the amounts used for taxation purposes deferred tax 
is measured using the tax rates that have been enacted or substantively enacted by the balance sheet date and are expected to 
apply when the asset is realised or the liability settled 
a net deferred tax asset is recognised only when it is probable that sufﬁ cient taxable proﬁ ts will be available in the foreseeable future 
from which the reversal of the temporary differences can be deducted
sharebased payments
the grantdate fair value of sharebased payment awards granted to employees is recognised as an employee expense with a 
corresponding increase in equity over the period that the employees unconditionally become entitled to the awards the amount 
recognised as an expense is adjusted to reﬂ ect the number of awards for which the related service and nonmarket vesting 
conditions are expected to be met such that the amount ultimately recognised as an expense is based on the number of awards 
that meet the related service and nonmarket performance conditions at the vesting date for sharebased payment awards with 
nonvesting conditions the grantdate fair value of the sharebased payment is measured to reﬂ ect such conditions and there is no 
trueup for differences between expected and actual outcomes
the fair value of the amount payable to employees in respect of share appreciation rights which are settled in cash is recognised 
as an expense with a corresponding increase in liabilities over the period that the employees unconditionally become entitled to 
payment the liability is remeasured at each reporting date and at settlement date any changes in the fair value of the liability are 
recognised as personnel expenses in proﬁ t or loss
employee share ownership plans
the material assets liabilities income and costs of the pace plc employee beneﬁ ts trust are treated as being those of the 
company until such time as the company’s own shares vest unconditionally with employees the consideration paid for the shares 
is deducted in arriving at equity
employee beneﬁ ts
obligations for contributions to deﬁ ned contribution pension plans are recognised as an expense in the income statement as 
incurred the group has no deﬁ ned beneﬁ t arrangements in place
notes
continued
pace ra 2012indd 47 12032012 1455 pace plc  2011 annual report    48
2  accounting policies continued 
interestbearing borrowings
interestbearing borrowings are recognised initially at fair value less attributable transaction costs subsequent to initial recognition 
interestbearing borrowings are stated at amortised cost using the effective interest method less any impairment losses
equity instruments
equity instruments issued by the company are recorded at the proceeds received net of direct issue costs  
dividends payable
distributions to equity holders are disclosed as a component of the movement in shareholders’ equity a liability is recorded for a 
ﬁ nal dividend when the dividend is approved by the company’s shareholders and for an interim dividend when the dividend is 
paid
provisions
a provision is recognised in the balance sheet when the group has a present legal or constructive obligation as a result of a past 
event and it is probable that an outﬂ ow of economic beneﬁ ts will be required to settle the obligation
a royalties
a provision for royalties is recognised where the owners of patents covering technology allegedly used by the group have indicated 
claims for royalties relating to the group’s use including past usage of that technology the provision is based on the latest 
information available 
b warranties
a provision for warranties is recognised when the underlying products or services are sold the provision is based on historical 
warranty data and a weighting of all possible outcomes against their associated probabilities the level of warranty provision 
required is reviewed on a product by product basis and provisions adjusted accordingly in the light of actual performance
c restructuring
a provision for restructuring is recognised when the group has approved a detailed and formal restructuring plan and the 
restructuring has either commenced or has been announced publicly provisions are not recognised for future operating losses
d onerous contracts
a provision for onerous contracts is recognised when the expected beneﬁ ts to be derived by the group from a contract are lower 
than the unavoidable cost of meeting its obligations under the contract
e deferred consideration
a provision is recognised for deferred consideration relating to acquisitions based on the expected fair value of the outﬂ ow
changes in accounting policy and disclosures
a new and amended standards adopted by the group
there are no new ifrss or ifric interpretations that are effective for the ﬁ rst time for the ﬁ nancial year beginning on or after 1 
january 2011 that would be expected to have a material impact on the group
b new standards amendments and interpretations issued but not effective for the ﬁ nancial year beginning 1 january 2011 and not 
early adopted
ias 19 ‘employee beneﬁ ts’ was amended in june 2011 the amendment does not impact the group
ifrs 9 ‘financial instruments’ addresses the classiﬁ cation measurement and recognition of ﬁ nancial assets and ﬁ nancial liabilities 
ifrs 9 was issued in november 2009 and october 2010 it replaces the parts of ias 39 that relate to the classiﬁ cation and 
measurement of ﬁ nancial instruments the group is yet to assess ifrs 9’s full impact and intends to adopt ifrs 9 no later than the 
accounting period beginning on or after 1 january 2015 subject to endorsement by the eu
ifrs 10 ‘consolidated financial statements’ builds on existing principles by identifying the concept of control as the determining 
factor in whether an entity should be included within the consolidated ﬁ nancial statements of the parent company the group is yet 
to assess ifrs 10’s full impact and intends to adopt ifrs 10 no later than the accounting period beginning on or after 1 january 
2013 subject to endorsement by the eu
notes
continued
pace ra 2012indd 48 12032012 1455 49    pace plc  2011 annual report
2  accounting policies continued 
ifrs 12 ‘disclosures of interests in other entities’ includes the disclosure requirements for all forms of interest in other entities 
including joint arrangements associates special purpose vehicles and other off balance sheet vehicles the group is yet to assess 
ifrs 12’s full impact and intends to adopt ifrs 12 no later than the accounting period beginning on or after 1 january 2013 
subject to endorsement by the eu
ifrs 13 ‘fair value measurement’ aims to improve consistency and reduce complexity by providing a precise deﬁ nition of fair value 
and a single source of fair value measurement and disclosure requirements for use across ifrss the group is yet to assess ifrs 
13’s full impact and intends to adopt ifrs 13 no later than the accounting period beginning on or after 1 january 2012 subject to 
endorsement by the eu
there are no other ifrss or ifric interpretations that are not yet effective that would be expected to have a material impact on the 
group
3  segmental analysis
in accordance with ifrs 8 ‘operating segments’ the chief operating decisionmaker “codm” has been identiﬁ ed as the board of 
directors which reviews internal monthly management reports budget and forecast information to evaluate the performance of the 
business and make decisions
during the year the group changed how it determines operating segments following the continued integration of prior year 
acquisitions segmental information is now provided on the basis of strategic business unit “sbu” areas being the basis on which 
the group manages its worldwide interests this assessment was made based on the current internal reporting framework and 
management structure following the conclusion of the strategic review announced by the chairman in 2011
the group has the following reportable segments
• pace americas
• pace europe
• pace enterprise
• unallocated
unallocated amounts include central and unallocated revenue costs and other immaterial sbus which are operating segments that 
are allowed to be aggregated under ifrs 8
reconciliations between pace americas pace europe pace enterprise and the geographical revenue disclosure given are not 
possible due to the different revenue streams which sit under each reportable segment 
performance is measured based on segmental adjusted ebita as included in the internal management information which is 
reviewed by the codm ebita before exceptional items is used to measure performance as management believes that such 
information is the most relevant in evaluating the results of certain segments relative to other entities that operate within these 
industries 
revenues disclosed below materially represent revenues to external customers and where appropriate pricing is determined on an 
arm’s length basis there are no material intersegment transactions 
the tables below present segmental information on the revised basis with prior periods amended to conform to the current period 
presentation
notes
continued
pace ra 2012indd 49 15032012 1301 pace plc  2011 annual report    50
3  segmental analysis continued
year ended 31 december 2011 pace pace pace
 americas europe enterprise unallocated total
 m m m m m
segmental income statement     
revenues 13506 8718 540 329 23093
adjusted ebita 1579 683  121 727 1414
exceptional items     127
amortisation     557
interest     183
tax     159
proﬁ t for the year     388
     
year ended 31 december 2010 restated pace pace pace
 americas europe enterprise unallocated total
 m m m m m
segmental income statement     
revenues 11206 9188 210 25 20629
adjusted ebita 1467 857 74 644 1606
exceptional items     295
amortisation     181
interest     28
tax     329
proﬁ t for the year     773
     
major customers
transactions with the group’s two largest customers represented 27 2010 17 of the group’s total revenues and are disclosed 
within the pace americas reporting segment
geographical analysis
in presenting information on the basis of geographical segments segment revenue is based on the geographical location of 
customers
revenue by destination  restated
 2011 2010
 m m
europe 4577 5682
north america 10651 8389
latin america 4690 3756
rest of world 3175 2802
 23093 20629
notes
continued
pace ra 2012indd 50 12032012 1455 51    pace plc  2011 annual report
3  segmental analysis continued 
segment assets are based on the geographical location of the assets the split of noncurrent assets by location is as follows
noncurrent assets  restated
 2011 2010
 m m
uk 657 540
europe 1839 1985
latin america 54 
north america 4126 4456
rest of world 29 85
 6705 7066
noncurrent assets relate to property plant and equipment and intangible assets and as required under ifrs 8 exclude deferred 
tax assets ﬁ nancial instruments and postemployment beneﬁ t assets
the group has three main revenue streams being stb gateways and software  services these revenue streams arise in each 
operating segment and are not deﬁ ned by geographical locations the following table provides an analysis of the group’s revenue 
streams according to those classiﬁ cations
in 2010 the majority of revenues were derived from the provision of stb and disclosure of other revenue streams was not 
considered necessary based on their nature
following the acquisitions in 2010 further disclosure is now considered appropriate
   
  restated
 2011 2010
 m m
settop boxes 17754 19359
gateways 4335 1074
software  services 1004 196
 23093 20629
     
 
notes
continued
pace ra 2012indd 51 12032012 1455 pace plc  2011 annual report    52
4  expenses and auditors’ remuneration
  restated
 2011  2010
 m m
fees payable to the company’s auditors for the audit of  
company’s annual ﬁ nancial statements 06 04
  
fees payable to the company’s auditors and its associates for other services to the group  
audit of the company’s subsidiaries ﬁ nancial statements pursuant to legislation 02 04
other services relating to taxation 02 01
services relating to corporate ﬁ nance  12
other services pursuant to interim reporting legislation  01 01
other services 02 
  
depreciation of property plant and equipment  
owned 290 163
  
other operating lease rentals  
land and buildings 97 96
  
loss on disposal of property plant and equipment 16 05
  
net foreign exchange losses recognised within operating proﬁ t 07 02
  
research and development expenditure recognised as an expense 1606 1200
5  exceptional items 
  restated
 2011  2010
 m m
restructuring and reorganisation costs 111 161
director’s loss of ofﬁ ce 16 
acquisition transaction costs  91
retail business exit costs  43
 127 295
the restructuring and reorganisation costs relate to a restructuring programme within the group which was announced in 
november 2011 and represent the costs of redundancy and associated professional fees the restructuring and reorganisation 
costs for the year ended 31 december 2010 relate to the integration of acquisitions into the group and employee costs in relation to 
the new group structure that has been implemented to manage the enlarged group
   
6   finance income  costs
  restated
 2011  2010
 m m
finance income – interest on bank deposits 02 12
finance costs  
bank borrowings 167 34
other ﬁ nance costs 18 06
 185 40
notes
continued
pace ra 2012indd 52 15032012 1301 53    pace plc  2011 annual report
7  staff numbers and costs
the average number of persons including directors employed by the group during the year analysed by category were as follows
 group
 2011 2010
  
research and development 987 816
administration 204 169
sales and marketing 60 26
manufacturing and operations 378 101
 1629 1112
the aggregate payroll costs of these persons were as follows
                    group
  restated
 2011  2010
 m m
 
wages and salaries 1377 713
social security costs 231 155
other pension costs 52 33
share based payments see note 27 78 94
redundancy costs 27 03
 1765 998
remuneration of directors
the remuneration share options and pension entitlements of the directors are disclosed in the remuneration report on pages 26 to 
29
8  taxation 
  restated
 2011  2010
 m m
current tax charge  
charge for the year 288 436
adjustments in respect of prior years 13 08
total current tax charge 275 428
  
deferred tax credit  
origination and reversal of timing differences in the current year note 14 90 99
impact of change in tax rate 11 
adjustment in respect of prior years 15 
total deferred tax credit 116 99
total tax charge 159 329
notes
continued
pace ra 2012indd 53 12032012 1455 pace plc  2011 annual report    54
8  taxation continued
reconciliation of effective tax rate to uk statutory rate of 265 2010 28
  restated
 2011  2010
 m m
proﬁ t before tax 547 1102
  
tax using uk statutory tax rate at 265 2010 28 145 308
  
effects of  
expenses not deductible for tax purposes 36 37
research and development tax credit 26 39
overseas tax not at 265 2010 28 43 31
impact of change in tax rate 11 
adjustments to tax charge in respect of previous periods 28 08
total tax charge 159 329
 
during the year as a result of the change in the corporation tax rate from 28 to 25 that was substantively enacted on 5 july 
2011 and that will be effective from 1 april 2012 the relevant deferred tax balances have been remeasured 
deferred tax expected to reverse in the future has been measured using the effective rate that will apply for the period 25 further 
reductions to the corporation tax rate have been announced the changes which are expected to be enacted separately each year 
propose to reduce the rate by 1 per annum to 23 by 1 april 2014 these changes had not been substantively enacted at the 
balance sheet date and therefore are not recognised in these ﬁ nancial statements  
9  earnings per ordinary share   
  restated
 2011  2010
basic earnings per ordinary share 132c 264c
  
diluted earnings per ordinary share 125c 250c
adjusted basic earnings per ordinary share 297c 371c
  
adjusted diluted earnings per ordinary share 281c 352c
the calculation of basic earnings per share is based on a proﬁ t after tax of 388m 2010 restated 773m divided by the weighted 
average number of ordinary shares in issue of 294189977 2010 293700084 excluding shares held by the employee beneﬁ ts 
trust 
  
 2011  2010
number of shares million  
weighted average number of ordinary shares in issue during the year 2942 2937
dilutive effect of options outstanding 168 155
diluted weighted average number of ordinary shares in issue during the year 3110 3092
diluted earnings per ordinary share varies from basic earnings per ordinary share due to the effect of the notional exercise of 
outstanding share options
notes
continued
pace ra 2012indd 54 12032012 1455 55    pace plc  2011 annual report
9  earnings per ordinary share continued
to better reﬂ ect underlying performance adjusted earnings per share is also calculated adjusting proﬁ t after tax to remove 
amortisation of other intangibles and exceptional items post tax  the earnings amount is calculated as follows
  restated
 2011  2010
 m m
proﬁ t after tax 388 773
amortisation charge 557 181
tax effect of above 162 60
exceptional items 127 295
tax effect of above 37  99
adjusted proﬁ t after tax 873 1090
the group’s effective tax rate has been used to calculate the tax effect of adjusted items
10  dividend per ordinary share 
   restated
 2011  2010
 per share m per share m
2010 final paid 6 july 2011 225c 66 155c 47
2011 interim paid 9 december 2011 125c 35 112c 33
 350c 101 267c 80
in addition the directors are proposing a ﬁ nal dividend for 2011 of 250 cents per ordinary share  this will be payable on 4 july 
2012 to shareholders on the register at 8 june 2012 subject to approval by shareholders at the forthcoming annual general 
meeting and has not been included as a liability in these ﬁ nancial statements
 
notes
continued
pace ra 2012indd 55 12032012 1455 pace plc  2011 annual report    56
11  intangible assets 
group
   customer
  development contracts and technology  other 
 goodwill expenditure relationships and patents  other intangibles
 m m m m m m
cost      
at 31 december 2009 restated 1133 1328 222 166  388
exchange adjustments 85 49 13 09  22
additions 2336 569    
acquisitions  02 1434 1161 109 2704
retirement of assets  212    
at 31 december 2010 restated 3384 1638 1643 1318 109 3070
fair value adjustment 28     
at 31 december 2010 restated 3356 1638 1643 1318 109 3070
additions  570    
retirement of assets  109    
at 31 december 2011 3356 2099 1643 1318 109 3070
      
amortisation       
at 31 december 2009 restated  866 92 71  163
exchange adjustments  23 07 04  11
provided in the year  561 98 77 06 181
retirement of assets  212    
at 31 december 2010 restated  1192 183 144 06 333
exchange adjustments  02    
provided in the year  479 210 306 41 557
retirement of assets  109    
at 31 december 2011  1560 393 450 47 890
      
net book value at 
31 december 2009 restated 1133 462 130 95  225
      
net book value at 
31 december 2010 restated 3356 446 1460 1174 103 2737
      
net book value at 
31 december 2011 3356 539 1250 868 62 2180
goodwill
all goodwill has arisen from business combinations and relates to the following acquisitions
• xcom multimedia communications sa now pace france sas in february 2001
• the settop box and connectivity solutions business of royal philips electronics pace france in april 2008
• bewan systems sa bewan in april 2010
• 2wire inc 2wire in october 2010 and
• latens systems limited latens in november 2010
notes
continued
pace ra 2012indd 56 12032012 1455 57    pace plc  2011 annual report
11  intangible assets continued 
the carrying amount of goodwill is allocated across cash generating units cgus as follows
• 1018m within pace europe
• 1816m within pace americas and
• 522m within pace enterprise
these cgus are independent sources of income streams and represent the lowest level within the group at which the associated 
goodwill is monitored for management purposes the group tests goodwill annually for impairment or more frequently if there are 
indications that goodwill might be impaired
the recoverable amount of cgus is determined from value in use calculations using cash ﬂ ow projections based on a combination 
of individual ﬁ nancial forecasts of varying time periods which have been approved by management and an appropriate long term 
growth rate of 1 2010 between 1 and 2
to prepare value in use calculations the cash ﬂ ow forecasts are discounted back to present value using an appropriate market
based discount rate the pretax discount rate used to calculate the value in use was 955 2010 between 10 and 14 
the directors have reviewed the recoverable amounts of the cgus and have also considered reasonable changes in the 
assumptions being increases in the pretax discount rate of up to an additional 10 the directors consider that there is sufﬁ cient 
headroom within the value in use calculations at 31 december 2011 
adjustments to the carrying value of goodwill made in the adjustment period have been presented as prior year adjustments and 
relate to the following
• 32m reduction in respect of adjustments to the provisional fair value of deferred revenue in 2wire
• 69m reduction in respect of tax losses brought forward in 2wire which were found to be recognisable
• 69m addition in respect of an adjustment to the deferred tax calculation on other timing differences and
• 04m addition in respect of trade receivables within latens which were found to be unrecoverable
other intangibles
other intangibles relate to trademarks and licence agreements customer contracts and relationships recognised as part of the 
acquisition of the pace france business
notes
continued
pace ra 2012indd 57 12032012 1455 pace plc  2011 annual report    58
11  intangible assets continued 
company development expenditure
 m
cost 
at 31 december 2009 restated 1037
exchange adjustments 39
additions 363
disposals 133
at 31 december 2010 restated 1228
additions 342
retirement of assets 99
at 31 december 2011 1471
 
amortisation 
at 31 december 2009 restated 770
exchange adjustments  29
provided in the year 329
disposals 133
at 31 december 2010 restated 937
provided in the year 274
retirement of assets 99
at 31 december 2011 1112
 
net book value at 31 december 2009 restated 267
  
net book value at 31 december 2010 restated 291
 
net book value at 31 december 2011 359
notes
continued
pace ra 2012indd 58 12032012 1455 59    pace plc  2011 annual report
12  property plant and equipment
group  short  plant
 long  leasehold  machinery 
 leasehold land and and motor 
 buildings  buildings  vehicles total
 m m m m
cost    
at 31 december 2009 restated  184 843 1027
exchange adjustments  07 40 47
additions  90 225 315
acquisitions 09  67 76
disposals 03 07 42 52
at 31 december 2010 restated 06 260 1053 1319
exchange adjustments   11 11
additions  130 285 415
disposals 06 24 116 146
 
at 31 december 2011  366 1211 1577
    
depreciation    
at 31 december 2009 restated  91 620 711
exchange adjustments  03 32 35
provided in the year 02 31 130 163
disposals  05 42 47
at 31 december 2010 restated 02 114 676 792
exchange adjustments   05 05
provided in the year  61 229 290
disposals 02 14 114 130
at 31 december 2011  161 786 947
    
net book value at 31 december 2009 restated  93 223 316
   
net book value at 31 december 2010 restated 04 146 377 527
 
net book value at 31 december 2011  205 425 630
notes
continued
pace ra 2012indd 59 12032012 1455 pace plc  2011 annual report    60
12  property plant and equipment continued
company short  plant
 leasehold machinery
 land and and motor
 buildings vehicles total
 m m m
cost   
at 31 december 2009 restated 152 417 569
exchange adjustments 06 16 22
additions 48 96 144
disposals  02 02
at 31 december 2010 restated 194 495 689
additions 39 119 158
disposals  03 03
at 31 december 2011 233 611 844
depreciation   
at 31 december 2009 restated 82 289 371
exchange adjustments 03 11 14
provided in the year 22 66 88
disposals  02 02
at 31 december 2010 restated 101 342 443
provided in the year 32 76 108
disposals  02  02
at 31 december 2011 133 416 549
   
net book value at 31 december 2009 restated 70 128 198
net book value at 31 december 2010 restated 93 153 246
   
net book value at 31 december 2011 100 195 295
notes
continued
pace ra 2012indd 60 12032012 1455 61    pace plc  2011 annual report
13   investments in and loans to group and other companies
company  shares in group  
 intragroup loans undertakings
 m m
cost  
at 31 december 2009 restated 1077 1141
exchange adjustments 40 42
additions 1919 2446
at 31 december 2010 restated 2956 3545
conversion of intragroup loans to shares 941 941
repayment 18 
at 31 december 2011 1997 4486
  
impairment  
at 31 december 2009 restated 1022 
exchange adjustments 38 
at 31 december 2010 restated 984 
reversal of impairment 893 
at 31 december 2011 91 
  
net book value at 31 december 2009 restated 55 1141
  
net book value at 31 december 2010 restated 1972 3545
  
net book value at 31 december 2011 1906 4486
during the year the company converted 941m of debt owed by pace distribution overseas limited into additional equity in that 
entity an impairment of 893m which had previously been charged against the loan through the income statement was reversed 
as the conversion meant that the impairment was no longer required
notes
continued
pace ra 2012indd 61 12032012 1455 pace plc  2011 annual report    62
13  investments in and loans to group and other companies continued
at 31 december 2011 the company had a beneﬁ cial interest in the equity of the following subsidiary undertakings
 nature of directly owned percentage country of
 operations by note a holding incorporation
  
pace advanced consumer electronics limited dormant 1 100 uk
pace asia paciﬁ c limited support 1 100 hong kong
pace distribution gmbh dormant 1 100 germany
pace distribution overseas limited holding company 1 100 uk
pace micro technology limited dormant 1 100 uk
pace hk limited       dormant 1 100 hong kong
pace australia pty limited support 1 100 australia
pace americas limited holding company 4 100 uk
pace americas inc trading 5 100 usa
pace europe sas support 4 100 france
pace micro technology gmbh support 1 100 germany
pace micro technology india private ltd support 1 100 india
pace overseas distribution limited    trading 4 100 uk
pace france sas trading 1 100 france
pace usa inc trading 10 100 usa
pace belgium nv dormant 3 100 belgium
pace asia home networks sdn bhd support 3 100 malaysia
pace software and services limited trading 3 100 uk
pace brasil – industria electronica e comercio ltda trading 14 100 brazil
pace iberia sl trading 3 100 spain
stb anchor mexicana sa de cv trading 13 100 mexico
pace china operations support 2 100 china
pace operations south africa propriety limited support 6 100 south africa
pace americas holdings inc holding 1 100 usa
pace americas investments llc holding 9 100 usa
latens systems ltd trading 1 100 uk
latens systems canada ltd support 8 100 canada
latens services ltd trading 8 100 uk
latens systems llc trading 8 100 usa
latens systems india private ltd support 8 100 india
2wire inc trading 11 100 usa
2wire asia paciﬁ c limited dormant 7 100 hong kong
2wire bc limited support 7 100 canada
2wire international ltd dormant 7 100 uk
kenati technologies inc holding 7 100 usa
2wire singapore pte ltd support 7 100 singapore 
2wire development center private ltd support 12 100 india
note a   directly owned by
1 pace plc 8 latens systems limited
2 pace asia paciﬁ c limited 9 pace americas holdings inc
3 pace france sas 10 pace americas inc
4 pace distribution overseas limited 11 pace americas investments llc
5 pace americas limited 12 kenati technologies inc
6 pace overseas distribution limited 13 pace usa inc 98 pace france sas 2
7 2wire inc 14 pace france sas 9999998 pace distribution overseas limited 000002
each of the subsidiary undertakings listed above has been consolidated in the group’s ﬁ nancial statements
each of the subsidiary undertakings listed above has a ﬁ nancial year end of 31 december with the exception of pace micro 
technology india private limited latens systems india private ltd and 2wire development centre private ltd 31 march
the class of share capital held is ordinary with the exception of pace distribution overseas limited where there is preference share 
capital in addition to ordinary share capital
notes
continued
pace ra 2012indd 62 12032012 1455 63    pace plc  2011 annual report
14   deferred tax assets  liabilities
the movements in deferred tax assets and liabilities during the year are shown below
group    short
 property plant    term timing
 and equipment trading losses intangibles differences total
 m m m m m
recognised asset  liabilities     
at 31 december 2009 restated 16  238 88 134
exchange adjustments   10 03 07
credited  charged to income statement 14 11 62 40 99
credited  charged to other 
comprehensive income    33 33
arising on acquisitions  376 919 218 325
at 31 december 2010 restated 02 387 1085 310 386
fair value adjustment  69 69  
at 31 december 2010 restated 02 456 1154 310 386
credited  charged to income statement 09 75 212 12 116
credited  charged to other 
comprehensive income    15 15
at 31 december 2011 07 381 942 283 285
     
shown as deferred tax assets 08 381  283 672
shown as deferred tax liabilities 15  942  957
company    short
 property plant    term timing
 and equipment trading losses intangibles differences total
 m m m m m
recognised asset  liabilities     
at 31 december 2009 restated 17  56 35 04
exchange adjustments 01  02 01 
credited  charged to income statement 14   31 17
credited  charged to other 
comprehensive income    33 33
at 31 december 2010 restated 02  54 32 20
credited  charged to income statement 06  04 03 01
credited  charged to other 
comprehensive income    15 15
at 31 december 2011 08  58 14 36
     
shown as deferred tax assets 08   14 22
shown as deferred tax liabilities   58  58
no deferred tax asset has been recognised on unused tax losses outside the uk of 35m 2010 restated 20m as it is not 
considered probable that sufﬁ cient taxable proﬁ t will be available against which the tax losses can be utilised
notes
continued
pace ra 2012indd 63 12032012 1455 pace plc  2011 annual report    64
15   inventories 
 group  company
  restated  restated
 2011 2010 2011 2010
 m m m m
    
raw materials and consumable stores 389 378 262 231
finished goods 1111 1849 231 98
 1500 2227 493 329
16   trade and other receivables
 group  company
  restated  restated
 2011 2010 2011 2010
 m m m m
    
trade receivables 3698 3998 972 949
amounts owed by subsidiary undertakings   3274 2908
other receivables 228 256 70 43
prepayments and accrued income 97 80 51 23
 4023 4334 4367 3923
group trade receivables of 3998m at 31 december 2010 have been reduced by 04m as a fair value adjustment was made 
within the measurement period see note 11 for further details 
17   trade and other payables
 group  company
  restated  restated
 2011 2010 2011 2010
 m m m m
trade payables 2879 4557 1947 2190
amounts payable to subsidiary undertakings   1770 764
social security and other taxes 39 34 15 12
other payables 244 114 04 06
accruals 573 679 115 171
 3735 5384 3851 3143
group other payables of 114m at 31 december 2010 have been reduced by 32m as a fair value adjustment was made within 
the measurement period see note 11 for further details
18  interest bearing loans and borrowings
the group’s interestbearing loans and borrowings are measured at amortised cost  for more information about the group’s 
exposure to interest rate foreign currency and liquidity risk see note 19
the company has a facility underwritten by rbs and hsbc incorporating lloyds tsb barclays santander and yorkshire bank in a 
syndicated deal
the main facilities at 31 december 2011 which are all denominated in us dollars consist of a 225m term loan facility together 
with a 150m revolving credit facility
the facilities have a termination date of 31 march 2014  amortisation of the original 300m term loan commenced on 20 june 
2011 with repayments of 375m made every six months until 20 december 2013  a ﬁ nal bullet repayment of 75m is due to be 
made on 31 march 2014
notes
continued
pace ra 2012indd 64 12032012 1455 65    pace plc  2011 annual report
notes
continued
18  interest bearing loans and borrowings continued
interest is payable on the facilities at libor plus a speciﬁ ed margin  the margin is subject to a ratchet linked to overall leverage 
conditions of the group
facility arrangement and associated fees of 9m were capitalised and are being amortised over the life of the facilities and included 
within the overall interest costs
there are certain ﬁ nancial covenants with regard to the facilities  these are principally linked to interest cover and net leverage
in addition to the main facilities a bilateral bonding facility with rbs was also entered into and covers bank guarantees principally 
in respect of duty and deferment requirements 155000
the carrying value of the year end borrowings position is as follows
 
  restated
 2011  2010
 m m
noncurrent liabilities  
bank term loans 1473 2198
  
current liabilities  
bank term loans 731 727
bank revolving credit facility 1500 1500
 2231 2227
the face value of the borrowings was 150m 2010 restated 225m in respect of the bank term loans within noncurrent liabilities 
75m 2010 restated 75m in respect of the bank term loans within current liabilities and 150m 2010 restated 150m in respect 
of the bank revolving credit facility
the difference between the face value amounts and the amounts in the above table is 27m 2010 restated 52m in noncurrent 
liabilities and 19m 2010 restated 23m in current liabilities which represents facility arrangement fees and accrued interest 
costs
 
reconciliation of net cash ﬂ ow to movement in net debt  restated
 2011  2010
 m m
cash and cash equivalents at end of the year 487 1314
current borrowings 2231 2227
noncurrent borrowings 1473 2198
closing net debt 3217 3111
pace ra 2012indd 65 12032012 1455 pace plc  2011 annual report    66
19   derivatives and other ﬁ nancial instruments
short term debtors and creditors that meet the deﬁ nition of a ﬁ nancial asset or liability respectively have been excluded from all the 
following analysis other than the currency risk exposures 
this note provides information about the contractual terms of the group and company’s interest bearing loans and borrowings for 
more information about the group and company’s exposure to interest rate credit risk and foreign currency risk see pages 11 and 
12 of the report of the directors
a interest rate risk proﬁ le of cashbank overdrafts
 floating rate interest free total
 m m m
currency   
at 31 december 2011   
sterling 21 04 17
us dollar 3720 227 3493
euro 152 163 11
other 212 36 248
total 3639 422 3217
   
at 31 december 2010 restated   
sterling 02 11 09
us dollar 3736 70 3666
euro 299 22 321
other 34 191 225
total 3405 294 3111
the interest rates on sterling us dollar euro and other ﬂ oating rate ﬁ nancial assets are linked to the relevant bank base rates
b currency exposures
the table below shows the group’s currency exposures that give rise to the net currency gains and losses recognised in the income 
statement such exposures comprise the monetary assets and monetary liabilities of the group which are not denominated in the 
operating or functional currency of the operating unit involved
  net foreign currency monetary assets  liabilities
 sterling us dollar euro other total
 m m m m m
functional currency of group operation     
at 31 december 2011     
sterling  03 14 01 16
us dollar 59  323 03 261
euro 28 334  01 307
other  49   49
total 31 380 337 05 79
     
at 31 december 2010 restated     
sterling  5179 634 39 4506
us dollar     
euro 06 638  05 637
other  85   85
total 06 5732 634 34 5058
notes
continued
pace ra 2012indd 66 12032012 1455 67    pace plc  2011 annual report
19  derivatives and other ﬁ nancial instruments continued
c gains and losses on currency derivatives
the majority of the group’s production costs are denominated in us dollars the group endeavours to obtain as much of its income 
as possible in us dollars the group’s policy is to hedge forward progressively against movements in the value of foreign currencies 
in respect of cash receipts and payments expected from transactions over the next 12 months
outstanding currency derivatives sell  buy principal average
 currency  currency amount rate maturity
at 31 december 2011 us dollar gbp 1019m 064 jan 12  dec 12 
 euro us dollar 1055m 135 jan 12  nov 12
at 31 december 2010 restated euro us dollar 2395m 135 jan 11 – mar 12
the group’s derivatives contracts qualify for hedge accounting and have a fair value at the balance sheet date of 45m 2010 
restated 23m
d credit risk
the group’s credit risk is primarily attributable to its trade debtors credit risk is managed by monitoring the aggregate amount and 
duration of exposure to any one customer depending upon their credit rating the group does not require collateral in respect of 
ﬁ nancial assets there were no signiﬁ cant impairments in the periods under review
credit risk
exposure to credit risk
the carrying amount of ﬁ nancial assets represents the maximum credit exposure the maximum exposure to credit risk at the 
reporting date was
 carrying amount 
  restated
 2011 2010
 m m
trade receivables 3698 3998
cash and cash equivalents 487 1314
forward exchange contracts used for hedging
       assets 48 59
 4233 5371
the maximum exposure to credit risk for receivables at the reporting date by geographic region was
 carrying amount 
  restated
 2011 2010
 m m
domestic 949 210
eurozone countries 240 963
united states 1951 1907
other regions 558 918
 3698 3998
notes
continued
pace ra 2012indd 67 12032012 1455 pace plc  2011 annual report    68
19  derivatives and other ﬁ nancial instruments continued 
the credit risk on liquid funds is limited because counterparties are banks with high credit ratings at each balance sheet date there 
was no signiﬁ cant concentration of credit risk other than those customers with revenues in excess of 10 of the group’s total 
revenues as explained in note 3
of the trade receivables at 31 december 2011 94 were within terms 2010 91 of the balance 4 were less than 30 days past 
due with the remaining amounts over 30 days due 2010 100 less than 30 days past due there were no material bad debts 
provisions deemed necessary against such balances in the current or preceding years
e liquidity risk
the group manages liquidity risk by maintaining adequate cash balances and banking facilities continuously monitoring forecast 
and actual cash ﬂ ows and matching the maturity proﬁ les of ﬁ nancial assets and liabilities
liquidity risk
the following are the contractual maturities of ﬁ nancial liabilities including estimated interest payments and excluding the impact of 
netting arrangements
 carrying contractual 6 months 612 12 23 34
 amount  cash ﬂ ows  or less  months years years years
 m m m m m m m
at 31 december 2011       
nonderivative ﬁ nancial liabilities       
trade and other payables within one year 3735 3735 3735    
external borrowings 3704 3936 426 420 825 2265 
deferred consideration 157 157 157    
derivative ﬁ nancial liabilities       
forward exchange contracts used for hedging       
   outﬂ ow  2074 1288 786   
   inﬂ ow 45 2119 1313 806   
total 7641 7783 4293 400 825 2265 
at 31 december 2010 restated       
nonderivative ﬁ nancial liabilities       
trade and other payables within one year 5384 5384 5384    
external borrowings 4425 4780 412 408 801 783 2376
deferred and contingent consideration 191 191   191  
derivative ﬁ nancial liabilities       
forward exchange contracts used for hedging       
   outﬂ ow  6774 5817 915 42  
   inﬂ ow 23 6797 5837 920 40  
total 10023 10332 5776 403 994 783 2376
it is not expected that the cash ﬂ ows included in the maturity analysis could occur signiﬁ cantly earlier or at signiﬁ cantly different 
amounts
the directors have considered the periods in which the cash ﬂ ows associated with derivatives that are cash ﬂ ow hedges are 
expected to occur together with the timing of impact on proﬁ t or loss and have determined that the timings are as disclosed in the 
above table
f sensitivity analysis
in managing interest rate and currency risks the group aims to reduce the impact of short term ﬂ uctuations on the group’s earnings 
the directors consider that a change of 100 basis points in interest rates during a twelve month period would have a 09m impact 
on cash ﬂ ows 2010 restated 28m
notes
continued
pace ra 2012indd 68 12032012 1455 69    pace plc  2011 annual report
19  derivatives and other ﬁ nancial instruments continued 
the group’s key foreign exchange exposures are in respect of the euro and sterling a 1 strengthening in the us dollar against 
these would have an adverse impact of 09m on the proﬁ t reported in the year ended 31 december 2011 and an adverse impact 
of 44m on equity in the year ended 31 december 2010 prior to the change in the group’s functional and presentational currency 
the group’s key foreign exchange exposures were in respect of the euro and us dollar
g capital management
capital risk management
the group and company manage their capital being the net assets base to ensure their ability to continue as a going concern and 
to maintain an optimal capital structure to reduce the cost of capital the capital structure of the group and company comprises 
equity attributable to equity holders of pace plc consisting of issued ordinary share capital reserves and retained earnings as 
disclosed in notes 21 22 and 24 and cash and cash equivalents and borrowings as disclosed in note 18
the group and company maintain or adjust their capital structure through the payment of dividends to shareholders issue of new 
shares and buyback of existing shares and issuing new borrowings or repaying existing borrowings
note 21 to the financial statements provides details regarding the company’s share capital and movements in the period there 
were no breaches of any requirements with regard to any relevant conditions imposed by either the ukla or the company’s articles 
of association during the periods under review
details of the company’s facilities are given in note 18 such facilities are subject to certain ﬁ nancial performance covenants there 
have been no breaches of these covenants in the period under review
h fair value
fair value versus carrying amounts
the directors have considered the fair values of ﬁ nancial assets and liabilities and have determined that these are not materially 
different from the carrying amounts shown in the group balance sheet
fair value hierarchy
the group’s ﬁ nancial instruments namely forward exchange contracts have been determined to represent level 1 instruments 
characterised by the existence of quoted prices unadjusted in active markets for identical assets or liabilities 
i exchange rates
the following signiﬁ cant exchange rates applied during the year
                      average rate                    spot rate
 2011 2010 2011 2010
    
euro 139 116 131 118
us dollar  155  155
sterling 062  064 
the 2010 rates above reﬂ ect those presented in the prior year ﬁ nancial statements when the functional and presentational currency 
of the group was sterling
notes
continued
pace ra 2012indd 69 15032012 1302 pace plc  2011 annual report    70
20   provisions
group royalties under 
 negotiation warranties other total
 m m m m
at 31 december 2009 restated 175 314 55 544
acquisitions  56  56
net charge for the year 68 310 233 611
utilised 87 211 16 314
exchange adjustments 06 18 05 29
at 31 december 2010 restated 150 451 267 868
net charge for the year 81 147 119 347
utilised 29 247 85 361
transfer 06  01 07
exchange adjustments  07 02 09
at 31 december 2011 208 358 304 870
    
due within one year  182 272 454
due after one year 208 176 32 416
company royalties under 
 negotiation warranties other total
 m m m m
at 31 december 2009 restated 175 159  334
net charge for the year 50 203 155 408
utilised 85 108  193
exchange adjustments 06 06  12
at 31 december 2010 restated 134 248 155 537
net charge for the year 36 116  152
utilised 29 180  209
exchange adjustments   02 02
at 31 december 2011 141 184 157 482
    
due within one year  93 157 250
due after one year 141 91  232
royalties under negotiation
the owners of patents covering technology allegedly used by the group have indicated claims for royalties relating to the group’s 
use including past usage of that technology negotiations over these liabilities continue for long periods of time the directors have 
made provision for the potential royalties payable based on the latest information available having taken legal advice the board 
considers that there are defences available that should mitigate the amounts being sought the group will vigorously negotiate or 
defend all claims but in the absence of agreement the amounts provided may prove to be different from the amounts at which the 
potential liabilities are ﬁ nally settled
given the nature of the claims it is not possible to be more speciﬁ c with regard to the timing of outﬂ ows
the directors consider that to disclose the amounts unused following the negotiation of royalty claims during the year would be 
seriously prejudicial to other royalty claims under negotiation in litigation or dispute accordingly the directors have aggregated 
amounts released unused with additional provisions made in order to arrive at the net charge for the year shown above
other provisions
other provisions relate to retirement and exceptional restructuring provisions within pace europe and deferred consideration in 
relation to the latens acquisition
notes
continued
pace ra 2012indd 70 12032012 1455 71    pace plc  2011 annual report
20   provisions continued
warranties
pace provides product warranties for its settop boxes from the point of sale and a provision for warranties is recognised when the 
underlying products are sold the provision is based on historical warranty data principally historical failure rates and related cost 
of repair information and a weighting of all possible outcomes against their associated probabilities the level of warranty provision 
required is reviewed on a product by product basis and provisions adjusted accordingly in the light of actual performance
although it is difﬁ cult to make accurate predictions of potential failure rates or the possibility of an epidemic failure as a warranty 
estimate must be calculated at the outset of product shipment before ﬁ eld deployment data is available these estimates improve 
during the lifetime of the product in the ﬁ eld
the directors consider that to disclose the amounts unused following the settlement of warranty claims during the year would be 
seriously prejudicial to other claims under negotiation accordingly the directors have aggregated amounts released unused with 
additional provisions made in order to arrive at the net charge for the year shown above
it is expected that the expenditure with regard to warranties will be incurred within ﬁ ve years of the balance sheet date
21   share capital
  2011  restated 2010
 number m number m
authorised    
ordinary shares of 5p each 500000000 388 500000000 388
    
allocated called up and fully paid    
ordinary shares of 5p each 305046066 283 304452503 282
the ordinary share capital of pace plc is designated in sterling
during the year the company also allotted ordinary shares as follows
  nominal value consideration
 number 000 000
employee share option plan 670 pence 194858 15 202
employee share option plan 740 pence 20164 2 23
employee share option plan 820 pence 110849 9 141
employee share option plan 1540 pence 869  2
employee share option plan 855 pence 266823 20 354
 593563 46 722
there are no special rights or obligations attaching to the ordinary shares and there are no shares in the company with special 
rights with regard to control of the company the articles of association of the company may be amended by special resolution of 
the company’s shareholders
the company’s articles of association provide that the company may refuse to transfer shares in the following customary 
circumstances where the share is not a fully paid share where the company has a lien where the share transfer has not been duly 
stamped with correct amount of stamp duty where the transfer is in favour of more than four joint transferees where the share is 
a certiﬁ ed share and is not accompanied by the relevant share certiﬁ cates and such other evidence as the board of directors may 
reasonably require to prove the title of the transferor or where the instrument of transfer is in respect of more than one class of 
share these restrictions are in addition to any which are applicable to all uk listed companies imposed by law or regulation
the notice of the annual general meeting speciﬁ es deadlines for exercising voting rights and appointing a proxy or proxies to vote in 
relation to resolutions to be passed at the annual general meeting all proxy votes are counted and numbers for against or withheld in 
relation to each resolution are announced at the annual general meeting and published on the company’s website after the meeting
at the annual general meeting to be held on 16 april 2012 shareholders will be asked to renew the directors’ power to allot shares 
and buy back shares in the company and to renew the disapplication of preemption rights 
notes
continued
pace ra 2012indd 71 12032012 1455 pace plc  2011 annual report    72
21   share capital continued
the company is not aware of any agreements between shareholders which may result in restrictions on the transfer of securities 
andor on voting rights
there are no signiﬁ cant agreements to which the company is a party that may take effect alter or terminate upon a change of 
controls following a takeover bid other than in relation to i employee share plans and ii the company’s borrowings which would 
become repayable on a takeover being completed
the company’s articles of association provide that i all directors must stand for election at the ﬁ rst annual general meeting after 
having been appointed to the board and ii at each annual general meeting one third of the directors who are subject to retirement 
by rotation must retire from ofﬁ ce and may seek reelection the articles set out the procedure for determining the identity of the 
directors to retire at a particular annual general meeting
shares in the company are held in the pace plc employee beneﬁ t trust “trust” for the purpose of satisfying awards made under 
the company’s employees’ share plans the trustees of the trust may exercise the voting rights attaching to shares held in the trust 
in respect of which the beneﬁ cial interest has not vested in any beneﬁ ciary provided that they are satisﬁ ed that to do so is in the 
beneﬁ ciaries’ interests the trustees have waived their right to vote in respect of any such shares held above 5
the company has granted options which are subsisting including directors’ options and contingent share awards in respect of the 
following presently unissued ordinary shares of 5p each
number of ordinary shares subject to option exercise period price per share pence
507539 1 october 2011 to 31 march 2012 670
706759 1 june 2012 to 30 november 2012 740
207994 1 june 2013 to 30 november 2013 1540
516737 1 june 2014 to 30 november 2014 1280
421618 4 june 2012 to 7 september 2012 1356
16337 18 january 2005 to 17 january 2012 3570
140000 22 october 2003 to 21 october 2012 1575
30000 26 august 2004 to 25 august 2013 510
50000 17 august 2005 to 16 august 2014 510
401999 2 october 2009  to 1 october 2016 5875
50000 19 february 2010 to 18 february 2017 695
508746 1 november 2010 to 31 october 2017 9775
1914990 24 june 2011 to 23 june 2018 855
1167917 24 june 2011 to 23 june 2013 855
455889 24 june 2012 to 23 june 2014 855
175094 24 june 2012 to 23 june 2018 855
300000 18 december 2012 to 17 december 2018 470
82560 18 december 2011 to 17 december 2018 470
201519 11 march 2013 to 10 march 2019 750
2146977 11 march 2012 to 10 march 2019 750
501882 30 july 2012 to 29 july 2019 19925
2081630 8 march 2013 to 7 march 2020 1767
173958 8 march 2014  to 7 march 2020 1767
150000 14 april 2013 to 13 april 2020 1968
91346 7 september 2013 to 6 september 2020 2080
250000 15 october 2013 to 14 october 2020 1884
140000 17 march 2014 to 16 march 2021 1658
225000 4 april 2014 to 4 april 2021 1535
338810 31 may 2014 – contingent share award 50
600000 31 may 2014 – contingent share award 50
14555301  
notes
continued
pace ra 2012indd 72 12032012 1455 73    pace plc  2011 annual report
21   share capital continued
the pace plc employee beneﬁ ts trust has granted options over existing shares to satisfy certain options details of these additional 
options are shown in note 24
 
22   share premium account
group and company m
at 31 december 2010 restated 726
premium on allotments 05
at 31 december 2011 731
the shares allotted during the year are listed in note 21
23   merger reserve
group and company m
at 31 december 2010 restated and 31 december 2011 1099
the merger reserve was created upon the acquisition of the settop box and connectivity solutions business of royal philips 
electronics
24   retained earnings
group m
at 31 december 2010 restated 2114
retained proﬁ t for the year 388
dividends to equity shareholders 101
deferred tax adjustments 29
employee share incentive charges 78
at 31 december 2011 2450
company m
at 31 december 2010 restated 1337
retained proﬁ t for the year 1073
dividends to equity shareholders 101
deferred tax adjustments 29
employee share incentive charges 78
at 31 december 2011 2358
own shares held
at 31 december 2011 the pace plc employee beneﬁ ts trust held 9744470 2010 11263524 shares in the company which cost 
160m 2010 restated 160m these shares are held to satisfy options granted to employees
the amounts arising on settlement of share options from the employee share trusts represents cash receipts from the exercise of 
relevant share options 
notes
continued
pace ra 2012indd 73 12032012 1455 pace plc  2011 annual report    74
24   retained earnings continued
the pace plc employee beneﬁ ts trust has granted options and contingent share awards to employees including directors’ options 
over ordinary shares of 5p each as follows
number of ordinary shares 
subject to option exercise period price per share pence
244988 26 august 2004 to 25 august 2013 510
175000 17 august 2005 to 16 august 2014 510
38829 2 october 2009 to 1 october 2016 588
546075 3 april 2010 to 2 april 2017 733
1687291 4 april 2014 to 3 april 2021  1535
1895275 march 2015 to 15 december 2021  698
4587458  
the pace plc employee beneﬁ ts trust holds the following shares to satisfy the international performance share plan performance 
share plan deferred share bonus and share award plans operated by the company
number of ordinary shares 
subject to option exercise period
 
272943 3 august 2012 to 1 august 2019 
2268691 5 may 2012 to 4 may 2019 
301978 18 may 2012 to 17 may 2019 
1824345 26 february 2012 to 25 february 2020 
171480 15 march 2012 to 15 march 2012 
2800298 8 march 2013 to 7 march 2020 
56126 7 september 2013 to 6 september 2020 
4290342 4 april 2014 to 3 april 2021 
1722095 18 march 2012 to 17 march 2014 
1060408 28 february 2013 to 27 february 2021 
200000 march 2014 
14968706  
25   proﬁ t for the year
the parent company has taken advantage of section 408 of the companies act 2006 and has not included its own income 
statement in these ﬁ nancial statements the group proﬁ t includes a parent company proﬁ t after tax of 1073m 2010 restated 
proﬁ t after tax of 445m
26  capital commitments
group and company  restated
 2011 2010
 m m
contracted but not provided for 20 28
 
notes
continued
pace ra 2012indd 74 12032012 1455 75    pace plc  2011 annual report
27   employee beneﬁ ts
pension plans
the group contributes to several deﬁ ned contribution group personal pension plans which all executive directors and employees 
are entitled to join the total expense relating to these plans in the current year was 52m  2010 restated 36m at 31 december 
2011 contributions of nil 2010 nil were outstanding
share based payments 
details of the company’s share option plans are included in notes 21 and 24 and the remuneration report the number and 
weighted average exercise price of share options is as follows
   restated
  weighted   weighted
 average     average 
 exercise  number exercise number
 price of options price of options
 2011 2011 2010 2010
outstanding at the beginning of the period 1762c 16240965 1595c 13378742
granted during the period 1871c 5629830 2511c 4770273
forfeited during the period 2714c 3073283 4588c 1064178
exercised during the period 1216c 593563 1178c 843872
outstanding at the end of the period 1656c 18203949 1762c 16240965
exercisable at the end of the period 1198c 5874980 1566c 2898498
outstanding options were as follows
range of exercise prices pence  weighted average weighted
 number  remaining average
 at 31 december contractual life  exercise
 2011 months price 
1575p – 49p 522560 75 60c
51p – 75p 6994960 53 108c
855p – 9775p 4222636 89 135c
128p – 357p 6463793 74 257c
 
 18203949 69 166c
the weighted average exercise price of options granted in the period was 1871c 2010 restated 2511c
the weighted average fair value at the measurement date of options granted in the year was 723c 2010 restated 310c
the weighted average exercise price at the date of exercise for options exercised in the year was 1216c 2010 restated 1178c
the weighted average share price during the year was 2914c 2010 restated 3007c
the fair value of services received in return for share options granted are measured by reference to the fair value of share options 
granted the estimate of the fair value of the services received is measured based on a blackscholes model the following 
table gives the assumptions applied to the options granted in the respective periods shown expectations of early exercise are 
incorporated into the model where appropriate
notes
continued
pace ra 2012indd 75 12032012 1455 pace plc  2011 annual report    76
27   employee beneﬁ ts continued
  restated
 2011 2010
average share price cents 1919c 2887c
weighted average exercise price cents 1656c 1762c
expected volatility  50 50
option life years 10 10
dividend yield  14 14
risk free interest rate  50 50
the expected volatility is based on the historic volatility calculated based on the weighted average remaining life of the share 
options adjusted for any expected changes to future volatility due to publicly available information
the charge for share based payments is 78m 2010 restated 94m which is comprised entirely of equity settled transactions 
28   leasing commitments 
total amounts payable under noncancellable operating lease rentals are as follows
                      group                        company
  restated  restated
 2011 2010 2011 2010
 m m m m
land and buildings   
within one year 92 98 12 11
between two and ﬁ ve years 241 260 48 48
in ﬁ ve years or more 96 116  12
 429 474 60 71
29   related parties
identity of related parties 
the group has a related party relationship with its subsidiaries and with its directors
transactions with subsidiaries 
the main transactions between the company and its subsidiaries consist mainly of payments by the company for distribution 
engineering and administrative support services provided by pace americas inc pace europe sas and pace micro technology 
india private ltd total transactions of 7595m were made in the year 2010 restated 7198m 
the amounts due to and from these subsidiaries are shown within notes 16 and 17
transactions with key management personnel 
key management of the group is through the executive directors of the company the main transactions with these individuals are 
disclosed in the remuneration report on pages 26 to 29 
of the share based payments charge of 78m 2010 restated 94m made in the period 42 2010 39 relates to options 
granted to the executive directors
notes
continued
pace ra 2012indd 76 12032012 1455 77    pace plc  2011 annual report
30   acquisitions
business combinations in the year ended 31 december 2011
there has been no business combinations in the year ended 31 december 2011
business combinations in the year ended 31 december 2010
during the year ended 31 december 2010 the group acquired the following businesses
• bewan systems sa
• 2wire inc
• latens systems limited
adjustments have been made to the net assets acquired within the adjustment period for 2wire inc and latens systems limited 
during the year ended 31 december 2011 these adjustments are described further in note 11
the balance sheet at 31 december 2010 included deferred and contingent consideration payable of 36m in respect of bewan 
systems sa of which  36m has been paid during the year and 155m in respect of latens systems limited of which nil has 
been paid during the year
31   free cash ﬂ ow and cash investment in acquisitions
  restated
 2011 2010
 m m
free cash ﬂ ow  
cash generated from operations 1500 1378
tax paid 297 392
purchase of property plant and equipment 415 306
development expenditure 570 569
exceptional expenditure paid in the year 143 169
acquisitions working capital increase from date of acquisition to year end  310
free cash ﬂ ow 361 590
 
  restated
 2011 2010
 m m
cash investment in acquisitions in the year  
acquisition of subsidiaries net of cash acquired 64 4224
acquisitions working capital increase from date of acquisition to year end  310
cash investment in acquisitions in the year 64 4534
32   post balance sheet events 
there are no signiﬁ cant or disclosable post balance sheet events 
notes
continued
pace ra 2012indd 77 12032012 1455 pace plc  2011 annual report    78
directors secretary and advisers
directors
all of victoria road saltaire bd18 3lf england
allan leighton nonexecutive chairman
mike pulli chief executive ofﬁ cer
stuart hall chief financial ofﬁ cer
roddy murray executive director
patricia chapmanpincher nonexecutive director
john grant nonexecutive director
mike inglis nonexecutive director
company secretary
anthony john dixon
registered and head ofﬁ ce
victoria road
saltaire bd18 3lf
england
registered number 01672847
auditors
kpmg audit plc
1 the embankment
neville street
leeds
ls1 4dw
registrars
capita registrars ltd
the registry
134 beckenham road
beckenham
kent
br3 4tu
stockbrokers
jefferies hoare govett
250 bishopsgate
london
ec2m 4aa
jp morgan cazenove
20 moorgate
london
ec2r 6da
pace ra 2012indd 78 15032012 1302 79    pace plc  2011 annual report
     restated
  restated restated restated 7 months
 year ended year ended year ended year ended ended
 31 dec 2011 31 dec 2010 31 dec 2009 31 dec 2008 31 dec 2007
 m m m m m
revenue 23093 20629 17796 13717 5048
proﬁ t before tax 547 1102 1098 254 311
proﬁ t before interest exceptional items  1414 1606 1200 537 321
amortisation and tax 
proﬁ t after tax 388 773 808 204 291
basic eps 132c 264c 278c 74c 127c
basic eps before exceptional items 297c 371c 303c 144c 127c
total equity 4071 3759 3159 2648 1366
shareholder information
 
annual general meeting 
the company’s annual general meeting will be held at 1030am on 16 april 2012 at the company’s head ofﬁ ce victoria road 
saltaire west yorkshire bd18 3lf 
capita registrars
enquiries regarding shareholdings change of address or other particulars should be directed in the ﬁ rst instance 
to the company’s registrars capita registrars ltd the registry 134 beckenham road beckenham kent br3 4tu or by 
telephone on 0871 664 0300 they also provide a range of online shareholder information services at wwwcapitashareportalcom 
where shareholders can check their holdings and ﬁ nd practical help on transferring shares or updating their details
 
multiple accounts on the shareholder register 
if you have received two or more copies of this document this means that there is more than one account in your name on the 
shareholder register this may be caused by either your name or address appearing on each account in a slightly different way for 
security reasons the registrars will not amalgamate the accounts without your consent if you would like any multiple accounts 
combined into one account please write to capita registrars at the address given above 
unsolicited mail 
the company is obliged by law to make its share register available upon request to the public and to other organisations which 
may use it as a mailing list resulting in shareholders receiving unsolicited mail shareholders wishing to limit the receipt of such mail 
should write to the mailing preference service dma house 70 margaret street london w1w 8ss or call 44 0 20 7291 3310 
for an application form or visit wwwmpsonlineorguk 
pace website
shareholders are encouraged to visit our website wwwpacecom which has a wealth of information about the company
five year record and shareholder information
pace ra 2012indd 79 12032012 1455 pace plc  2011 annual report    80
notes
pace ra 2012indd 80 12032012 1455 81    pace plc  2011 annual report
notes
pace ra 2012indd 81 12032012 1455 02 highlights
04 chairman’s letter
05 chief executive officer’s review
08 chief financial officer’s review
11 report of the directors
22 directors’ remuneration report
31 statement of directors’ responsibilities
32 independent auditors’ report
35 financial statements
42 notes to the financial statements
78 directors secretary and advisers
79 five year record and shareholder information
contents
01    pace plc 2011 annual report pace plc 2011 annual report    
front  back coverindd 46 12032012 1240
83 a world leader in digital and broadband technologies
annual report  accounts 2011
annual report  accounts 2011
mktra2011
front  back coverindd 13 12032012 1240


Summary:
 pace plc 2011 annual report    04 03    pace plc 2011 annual report
we are now ﬁ rmly 
focused on execution 
and delivering a 
ﬁ tter more proﬁ table 
business with strong 
cash ﬂ ow
“i am pleased to report results in line 
with the guidance issued in november 
2011 following the strategic review 
and actions subsequently taken there is 
a clear route to delivering a successful 
2012 for pace our focus on operational 
improvement and effi ciency is already 
starting to deliver tangible results and 
will contribute further to our future 
competitive advantage we continue to 
strategically invest in leveraging our 
technology assets across our markets”
mike pulli 
chief executive offi cer
chairman’s letter
through the ‘ups and bumps’ the group has made progress 
in key areas during the year including the successful integration 
of the businesses we acquired during 2010 development of 
advanced technologies such as the settop box for the “x1” 
platform for comcast and the home media centre for directv 
and the strong growth we continue to see in developing 
markets particularly latin america
pace’s core is its engineering excellence complemented by 
strong customerfocused skills and delivery capabilities
following the appointment of mike pulli as chief executive 
offi cer in december 2011 we have the right leader to deliver 
on the opportunities to grow shareholder value identifi ed by 
our strategic review it confi rmed that pace operates in large 
growing and profi table markets with differentiated capabilities 
and established as the group’s primary objectives
•	 	to	build	on	our	position	as	a	world	leading	settop	box	and	
residential gateway company
•	 to	impr ove	on	operational	excellence	and
•	 	to	accelerate	‘widening	out’	by	pursuing	opportunities	to	
provide software  services assets
executing on these objectives will lead to a realistic medium 
term operating margin target of up to 9 as well as increasing 
the group’s ‘sticky profi ts’ – which translates to enhanced 
quality of earnings and therefore multiple
despite challenges experienced during 2011 operational focus 
undertaken since the strategic review and confi dence in the 
longterm earnings potential from our markets gives the board 
confi dence to continue building on the progressive dividend 
policy that was introduced in 2009 therefore the board is 
recommending a fi nal dividend of 250c per share giving a full 
year dividend of 375c per share an 113 increase on 2010
if you have any comments on my letter or any part of the annual 
report i would be delighted to hear from you either by writing 
to me at pace or by email at allanleightonpacecom
yours sincerely
allan leighton
chairman
6 march 2012
dear shareholder
2011 has been a challenging year 
for pace but despite this the board 
believes that there is real potential for 
pace to become a ‘great technology 
company’ and confi dence that the 
areas of focus identifi ed through our 
strategic review undertaken during 
the year provides a path to unlocking 
its full value
front end 2011 v10indd 45 16032012 1125 pace plc 2011 annual report    06 05    pace plc 2011 annual report
chief executive
officer’s review
key highlights of the year
pace’s markets have remained resilient during the year 
with paytv continuing to show growth despite difficult 
global economic conditions overall digital paytv 
subscribers are expected to grow at circa 10 cagr 
between 2011 and 2015 overthetop ott delivery 
is expected to be complementary to continued paytv 
growth paytv in advanced markets has embraced ip 
and internet delivery with next generation ‘ip fluent’ 
devices having become a market reality in addition home 
networking technologies such as wifi are becoming 
increasingly important as is the emergence of tv 
everywhere technology pace is at the forefront of enabling 
operators to address the opportunities presented by these 
advanced technologies further opportunities exist for 
pace in emerging markets as these continue greenfield 
growth and their conversion to digital
2011 has been a challenging year operationally for pace 
with the company addressing inventory management 
issues and reduced profitability in pace europe as well as 
the impact of two major natural disasters the disruption 
to hard disk drive hdd supply resulting from flooding in 
thailand was a major challenge in the final quarter of 2011 
and will continue to impact results during 2012 with the 
impact to be predominantly felt during the first half of the 
year through keen operational focus working closely with 
suppliers and customers the impact of this issue was 
contained to 36m of revenue and 9m of operating 
profit in 2011
pace generated 2011 revenues of 23093m 
up 119 on 2010 due to the fullyear effect 
of 2010 acquisitions and adjusted ebita of 
1414m equivalent to 61 of revenues 
down 17ppt on 2010 our strategic review 
highlighted opportunities for improving both 
the level and quality of our earnings we are 
actively delivering to this plan
i am pleased to be able to report the 2011 annual results for pace the first since my 
appointment as chief executive officer on 14 december 2011 whilst pace has faced a 
number of operational challenges in 2011 our strategic review identified a number of 
opportunities which if well executed will deliver significant value for shareholders over the 
coming years
all of the businesses acquired by pace in 2010 have 
been successfully integrated with the related synergies 
realised ahead of and in excess of our expectations in 
particular the acquisition of 2wire continues to deliver 
benefits to the group both through increased revenue 
and profitability and through the technology assets which 
enable us to offer operators the additional applications 
and services that consumers are demanding in the more 
developed markets in which pace operates there is a shift 
towards the use of internet delivery technology for the 
distribution and viewing of content the combination of 
gateway expertise acquired with 2wire and bewan and 
the existing settop box stb technology within pace 
provides a strong platform from which to capitalise on 
these opportunities
north america
the paytv market in north america is the most 
technologically advanced characterised by the increasing 
emergence of whole home stbs and vdsl tripleplay 
gateways as services demand higher speeds we believe 
the digital paytv market in north america will continue to 
see low single digit annual growth in subscribers for the 
foreseeable future
total revenues in north america increased by 27 to 
1065m in 2011 driven by the full year impact of the 
2wire acquisition in october 2010 organic revenues 
comprising stb sales in the cable and satellite markets 
decreased by 177 to 595m reflecting lower sales 
of personal video recorder pvr products and a 
normalisation of our leadership position achieved in 2010 
on certain customer specific products volumes of stbs 
in north america increased by 33 reflecting a higher 
number of lowervalue digital television adapter dta 
shipments in the year whilst other stb volumes declined 
pace did introduce a number of advanced products in the 
developed north america market including the stb for 
the “x1” platform for comcast and a whole home solution 
for directv these confirmed pace’s continued position 
of technological leadership in our sector and we remain 
optimistic about the longterm strength of the market for 
our products in north america
gateway revenues increased by 294m to 392m 
reflecting the full year of trading from 2wire on a like
forlike basis revenue decreased 8 as a result of a pull 
forward of adsl product into 2010 underlying growth 
adjusted for this was 10 
software  services revenues in north america increased 
by 60m to 78m up 11 on a likeforlike basis this 
revenue is primarily comprised of customer care system 
management products and professional services
latin america 
the latin america market displays strong subscriber growth 
and ongoing conversion to digital and is heavily influenced by 
the us market showing a strong appetite for high definition 
hd products
total revenues in latin america increased by 25 to 469m 
in 2011 with strong underlying growth from both satellite 
and cable operators as pace continued to experience very 
high market share in these expanding markets particularly in 
brazil
growth was entirely from the organic business and mirrored 
growth in our customers’ subscriber bases volume growth 
was ahead of revenue growth at 77 reflecting a higher 
proportion of lower value standard definition sd boxes 
the businesses acquired during 2010 had relatively little 
activity in this region however there are opportunities in 
these markets to deliver integrated solutions comprising 
pace hardware and software
over the last two years pace’s performance has been 
particularly strong in latin america as we have been first to 
market with new products during digital conversion such 
as hd boxes and pvrs again demonstrating technological 
leadership in the sector however this has resulted in an 
unsustainably high market share in these territories which 
we expect to normalise in the next 12 – 24 months as 
competition in the market for the supply of these products 
increases
europe
the market in europe is characterised by high levels of 
hd and pvr penetration addition of hybrid services and 
increasing levels of home networking
revenues in europe declined by 19 to 458m in 2011 
driven by a decline in the stb business as pace ceased retail 
sales and exited from low margin business in italy
the welldeveloped western european market is primarily 
focused on hdconversion with over 90 of revenues 
relating to hd products furthermore over 35 of european 
stb sales included a pvr functionality
residential gateways remain a small proportion of the 
overall european business with revenue of 29m software 
 services revenue of 18m includes the latens content 
protection systems device software and maintenance 
services in support of stb sales the strategic review 
identified significant opportunities among midtier operators 
in europe for integrated solutions incorporating our software 
assets and we are focused on developing opportunities in 
this segment of the market
 
source ihs screen digest february 2012
front end 2011 v10indd 67 16032012 1125 pace plc 2011 annual report    06 05    pace plc 2011 annual report
chief executive
officer’s review
key highlights of the year
pace’s markets have remained resilient during the year 
with paytv continuing to show growth despite difficult 
global economic conditions overall digital paytv 
subscribers are expected to grow at circa 10 cagr 
between 2011 and 2015 overthetop ott delivery 
is expected to be complementary to continued paytv 
growth paytv in advanced markets has embraced ip 
and internet delivery with next generation ‘ip fluent’ 
devices having become a market reality in addition home 
networking technologies such as wifi are becoming 
increasingly important as is the emergence of tv 
everywhere technology pace is at the forefront of enabling 
operators to address the opportunities presented by these 
advanced technologies further opportunities exist for 
pace in emerging markets as these continue greenfield 
growth and their conversion to digital
2011 has been a challenging year operationally for pace 
with the company addressing inventory management 
issues and reduced profitability in pace europe as well as 
the impact of two major natural disasters the disruption 
to hard disk drive hdd supply resulting from flooding in 
thailand was a major challenge in the final quarter of 2011 
and will continue to impact results during 2012 with the 
impact to be predominantly felt during the first half of the 
year through keen operational focus working closely with 
suppliers and customers the impact of this issue was 
contained to 36m of revenue and 9m of operating 
profit in 2011
pace generated 2011 revenues of 23093m 
up 119 on 2010 due to the fullyear effect 
of 2010 acquisitions and adjusted ebita of 
1414m equivalent to 61 of revenues 
down 17ppt on 2010 our strategic review 
highlighted opportunities for improving both 
the level and quality of our earnings we are 
actively delivering to this plan
i am pleased to be able to report the 2011 annual results for pace the first since my 
appointment as chief executive officer on 14 december 2011 whilst pace has faced a 
number of operational challenges in 2011 our strategic review identified a number of 
opportunities which if well executed will deliver significant value for shareholders over the 
coming years
all of the businesses acquired by pace in 2010 have 
been successfully integrated with the related synergies 
realised ahead of and in excess of our expectations in 
particular the acquisition of 2wire continues to deliver 
benefits to the group both through increased revenue 
and profitability and through the technology assets which 
enable us to offer operators the additional applications 
and services that consumers are demanding in the more 
developed markets in which pace operates there is a shift 
towards the use of internet delivery technology for the 
distribution and viewing of content the combination of 
gateway expertise acquired with 2wire and bewan and 
the existing settop box stb technology within pace 
provides a strong platform from which to capitalise on 
these opportunities
north america
the paytv market in north america is the most 
technologically advanced characterised by the increasing 
emergence of whole home stbs and vdsl tripleplay 
gateways as services demand higher speeds we believe 
the digital paytv market in north america will continue to 
see low single digit annual growth in subscribers for the 
foreseeable future
total revenues in north america increased by 27 to 
1065m in 2011 driven by the full year impact of the 
2wire acquisition in october 2010 organic revenues 
comprising stb sales in the cable and satellite markets 
decreased by 177 to 595m reflecting lower sales 
of personal video recorder pvr products and a 
normalisation of our leadership position achieved in 2010 
on certain customer specific products volumes of stbs 
in north america increased by 33 reflecting a higher 
number of lowervalue digital television adapter dta 
shipments in the year whilst other stb volumes declined 
pace did introduce a number of advanced products in the 
developed north america market including the stb for 
the “x1” platform for comcast and a whole home solution 
for directv these confirmed pace’s continued position 
of technological leadership in our sector and we remain 
optimistic about the longterm strength of the market for 
our products in north america
gateway revenues increased by 294m to 392m 
reflecting the full year of trading from 2wire on a like
forlike basis revenue decreased 8 as a result of a pull 
forward of adsl product into 2010 underlying growth 
adjusted for this was 10 
software  services revenues in north america increased 
by 60m to 78m up 11 on a likeforlike basis this 
revenue is primarily comprised of customer care system 
management products and professional services
latin america 
the latin america market displays strong subscriber growth 
and ongoing conversion to digital and is heavily influenced by 
the us market showing a strong appetite for high definition 
hd products
total revenues in latin america increased by 25 to 469m 
in 2011 with strong underlying growth from both satellite 
and cable operators as pace continued to experience very 
high market share in these expanding markets particularly in 
brazil
growth was entirely from the organic business and mirrored 
growth in our customers’ subscriber bases volume growth 
was ahead of revenue growth at 77 reflecting a higher 
proportion of lower value standard definition sd boxes 
the businesses acquired during 2010 had relatively little 
activity in this region however there are opportunities in 
these markets to deliver integrated solutions comprising 
pace hardware and software
over the last two years pace’s performance has been 
particularly strong in latin america as we have been first to 
market with new products during digital conversion such 
as hd boxes and pvrs again demonstrating technological 
leadership in the sector however this has resulted in an 
unsustainably high market share in these territories which 
we expect to normalise in the next 12 – 24 months as 
competition in the market for the supply of these products 
increases
europe
the market in europe is characterised by high levels of 
hd and pvr penetration addition of hybrid services and 
increasing levels of home networking
revenues in europe declined by 19 to 458m in 2011 
driven by a decline in the stb business as pace ceased retail 
sales and exited from low margin business in italy
the welldeveloped western european market is primarily 
focused on hdconversion with over 90 of revenues 
relating to hd products furthermore over 35 of european 
stb sales included a pvr functionality
residential gateways remain a small proportion of the 
overall european business with revenue of 29m software 
 services revenue of 18m includes the latens content 
protection systems device software and maintenance 
services in support of stb sales the strategic review 
identified significant opportunities among midtier operators 
in europe for integrated solutions incorporating our software 
assets and we are focused on developing opportunities in 
this segment of the market
 
source ihs screen digest february 2012
front end 2011 v10indd 67 16032012 1125