(Adds CEO comments and background.)

By Rory Gallivan

LONDON--U.K. semiconductor group Imagination Technologies Group PLC (IMG.LN) posted a wider full-year pretax loss as it continued to invest in research and development, but said it expects to benefit from a slower growth in operating costs in the future.

Imagination, whose chips are found in devices made by Apple Inc., Tuesday reported a pretax loss of 12 million pounds ($19.1 million) for the year ended April 30, against a GBP314,000 loss the previous year, on revenue up to GBP177 million from GBP170.8 million.

Royalty revenue from sales of devices containing Imagination's technology rose 9% to GBP118.9 million, boosted by a better-than-expected performance from MIPS, which Imagination acquired in 2012.

Revenue from licensing its technology to other companies rose just 2% to GBP39 million, in line with the company's warning in March that licensing revenue would be close to the previous year's level, not up 10% as previously predicted.

Imagination said it is targeting licensing revenue growth of 10% in the current year and it expects royalty revenue to rise.

"As our revenues grow, the natural operational gearing of the business means that the financial performance is expected to significantly benefit from a slower growth in operating costs," said Chief Executive Hossein Yassaie.

Speaking to Dow Jones Newswires, Mr Yassaie said he was particularly pleased that MIPS is performing ahead of expectations, which he said shows customers have welcomed the competition it has brought to a market dominated by ARM Holdings PLC.

MIPS specializes in central processing units, which power the general functions performed by smartphones and other devices. Imagination was previously focused on graphics processing units, or GPUs, but decided to diversify following a push by ARM Holdings into the GPU market.

Mr Yassaie said Imagination will continue to invest in growing technology areas despite plans to keep a lid on operating cost growth. Such areas include the "Internet of Things," a term used to describe objects such as speakers and cars being connected to the Internet so they can be controlled or monitored remotely, and the security issues associated that arise from this, he said.

Shares at 1051 GMT were up 7 pence, or 3.3%, at 223 pence valuing the company at GBP604.6 million.

-Write to Rory Gallivan at rory.gallivan@wsj.com; Twitter: @RoryGallivan

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