Saltaire-based Pace plc, the digital TV technology group, is scaling down recruitment and has not ruled out job losses as it prepares for lower profits next year. The company has been hit by the falling value of sterling, particularly against the US dollar.

Although its trading performance is expected to be on target for the rest of the year, bosses are preparing to clamp down on costs in the face of currency fluctuations. The election of Barack Obama as the next US president could also strengthen the dollar, adding to Pace’s worries.

Neil Gaydon, chief executive, said the board was taking a prudent view and planning for lower profitability in 2009-10.

Pace pays for 95 per cent of it supplies in US dollars and earns 60 per cent of its revenues in dollars, 30 per cent in Euros and just ten per cent in pounds.

Mr Gayden said: “We have in place some good hedging arrangements that will help offset the currency fluctuations but we have decided to take a cautious approach to next year.

“Driving down costs will include restricting hiring where possible. Neither can we rule out that we may have to let some people go, although we would not be looking at wholesale jobs cuts.”

In an interim management statement on performance expectations for 2008 and 2009, Mr Gayden said: “Demand for Pace’s products has been strong, and we are on target to meet 2008 expectations. The ongoing transition to digital TV and consumer demand for high quality home entertainment is a very positive driver for Pace’s business and we expect strong revenue growth to continue in 2009..”

The company had a strong balance sheet, with no borrowing and positive cash balances.

It had continued to roll out advanced personal video recorders (PVR), high definition and standard set-top boxes for pay TV operators in all major digital markets.

The integration of the Pace France business had progressed well and Pace also confirmed its position as a world-leader in low environmental impact set-top boxes to ensure customers can meet growing environmental performance requirements.

The company is also well placed to benefit from world transition to digital TV, either through Government led analogue switch off or through consumer desire to improve the quality of home entertainment.

Although Pace could not be immune from the global economic events, recent consumer reports confirmed the company’s experience that, in an economic slow down, consumers spend more money and time on home entertainment.