* H1 revenue falls a better-than-expected 3 pct
* H1 adjusted pretax slumps 75 pct, reflecting higherinvestment
* Shares up 12 pct (Adds CEO comments, analyst reaction, shares)
By Paul Sandle
LONDON, Dec 16 (Reuters) - Imagination Technologies,the British company that supplies graphics processing to AppleInc, said it expected an improved second half as costlyinvestments which weighed on the first months of the year beginto pay off.
The cost of developing its MIPS processing platforms -- acomputer processing architecture first developed in the 1980s --and multimedia contributed to a 75 percent drop in adjustedprofit in the first half, the company said.
"We are migrating from a heavy investment to exploitation,"said Chief Executive Hossein Yassaie.
"We should see significant and steady improvement infinancial performance."
The group has been investing in the MIPS processing platformafter it bought the owner of the pioneering 32-bit and 64-bittechnology two years ago.
Shares in the group jumped 12 percent in early deals onTuesday as analysts said the results were not as bad asexpected, with revenue, down 3 percent to 82.2 million pounds($129.1 million), just ahead of consensus.
They were trading at 212.8 pence at 1012 GMT.
Jefferies analyst Lee Simpson, who rates Imagination a"buy", said the results were better than expected on both thetop and bottom lines.
"Royalties growth in the first half is better than hoped,with (volumes of MIPS shipped) stabilizing sooner thanexpected," he said.
Imagination reported adjusted profit of 3.3 million poundsfor the six months to end-October, down from 13.2 million poundsa year earlier.($1 = 0.6367 pounds) (Editing by Kate Holton and Clara Ferreira Marques)
