Financial Performance - Group revenue decreased by 2.1% to $1,140.9 million[2] - Profit attributable to shareholders rose by 14.1% to $93.6 million[2] - Basic and diluted earnings per share increased to 37.0 cents from 32.5 cents[4] - Total revenue for the six months ended September 30, 2023, was $1,140.9 million, a decrease from $1,164.8 million for the same period in 2022, representing a decline of approximately 2.0%[13] - The group reported a pre-tax profit of $110.3 million for the six months ended September 30, 2023, compared to $99.0 million in the same period of 2022, an increase of 11.7%[20] - Basic and diluted earnings per share were $0.37, up from $0.32 in the previous year, reflecting an increase of 15.6%[24] - The group expects a slight decline in overall revenue for the fiscal year due to unfavorable economic conditions, but profitability is expected to improve due to reduced material costs and freight[48] - Operating profit for the six months ended September 30, 2023, was $110.3 million, an increase of $11.3 million or 11.4% compared to the same period last year, with an operating profit margin rising from 8.5% to 9.7%[53] - Net profit attributable to shareholders for the six months ended September 30, 2023, was $93.6 million, up $11.6 million or 14.1%, with a net profit margin increasing from 7.0% to 8.2%[54] Revenue Breakdown - Revenue from electronic learning products was $396.2 million, down from $474.1 million in the previous year, indicating a decrease of about 16.4%[13] - Revenue from telecommunications products was $163.9 million, compared to $189.4 million in the prior year, reflecting a decline of approximately 13.5%[13] - Contract manufacturing services generated $580.8 million in revenue, an increase from $501.3 million, marking a growth of about 15.8%[13] - North America contributed $489.4 million to total revenue, while Europe contributed $468.7 million, and the Asia-Pacific region contributed $171.5 million[13] - North America reported revenue of $489.4 million for the six months ended September 30, 2023, down from $530.5 million in the same period of 2022, representing a decrease of 7.1%[18] - Europe generated revenue of $468.7 million, slightly down from $470.4 million year-over-year, a decrease of 0.4%[18] - Asia-Pacific region saw revenue increase to $171.5 million from $152.2 million, marking a growth of 12.9%[18] - Telecommunications product revenue in Europe decreased by 5.6% to $43.7 million, with declines in home phones, business phones, and other telecom products[42] - Contract manufacturing services in Europe saw a revenue increase of 5.3% to $278.8 million, driven by improved material supply[42] - Revenue in the Asia-Pacific region increased by 12.7% to $171.5 million, primarily due to higher sales in contract manufacturing services[44] - Telecommunications product revenue in the Asia-Pacific region decreased by 16.5% to $11.6 million, impacted by declines in Japan and Hong Kong[45] - Contract manufacturing services in the Asia-Pacific region increased by 29.6% to $124.9 million, supported by significant growth in DJ equipment orders[45] - Revenue in other regions decreased by 3.4% to $11.3 million, with electronic learning products' growth offset by declines in telecommunications products[46] Expenses and Assets - Research and development expenses were $42.0 million, slightly down from $42.3 million[4] - Total assets less current liabilities amounted to $762.5 million, up from $752.7 million[7] - Cash and cash equivalents increased to $108.5 million from $103.3 million[7] - The total assets reported as of September 30, 2023, were $1,355.2 million, up from $1,318.4 million as of March 31, 2023, an increase of 2.8%[19] - The total liabilities increased to $(745.5) million from $(683.7) million, reflecting a rise of 9.1%[19] - Total accounts receivable, deposits, and prepayments amounted to $516.8 million as of September 30, 2023, compared to $324.3 million as of March 31, 2023, and $549.0 million as of September 30, 2022[26] - Total accounts payable and accrued expenses reached $537.5 million as of September 30, 2023, up from $468.5 million as of March 31, 2023, but down from $644.5 million as of September 30, 2022[28] Dividends and Shareholder Returns - The company maintained an interim dividend of 17.0 cents per share[2] - The interim dividend declared was $0.17 per share, consistent with the previous year, while the total estimated final dividend for the year was $106.1 million, down from $128.9 million in the prior year[23] - The board declared an interim dividend of $0.17 per share, estimated to total $43 million[55] Market Outlook and Strategy - The company expressed a more conservative outlook due to an uncertain economic environment[2] - The company is focusing on strict inventory and operating expense controls to enhance profitability despite the challenging economic environment[48] - The company launched several innovative products during the period, including new core learning products for infants and preschool categories[36] - New product launches, including the KidiZoom Smartwatch MAX and Turbo Edge Riders™, are anticipated to drive sales growth in the second half of the fiscal year[48] - The group plans to invest in advertising and promotions to ensure strong sales during the upcoming holiday season[48] Compliance and Governance - The company is currently assessing the impact of new accounting guidelines related to the cancellation of the MPF offset mechanism, which is expected to take effect on May 1, 2025[10] - Management has initiated procedures to implement changes related to the new accounting policies, including additional data collection and impact assessment[11] - The company has not adopted any new standards or interpretations that are not yet effective for the current accounting period[9] - The company adopted the standard code for securities trading as per the listing rules, applicable to directors and designated employees, confirming compliance for the six months ending September 30, 2023[62] - The audit committee reviewed the unaudited interim financial report and performance for the six months ending September 30, 2023[63] - No purchases, sales, or redemptions of listed securities occurred by the company or its subsidiaries during the six months ending September 30, 2023[64]

Financial Performance - For the fiscal year ending March 31, 2023, the company's revenue decreased by 5.4% to $2,241.7 million compared to $2,370.5 million in the previous year[6]. - Gross profit also declined by 5.3% to $633.7 million, down from $669.1 million[6]. - Operating profit fell by 11.4% to $180.5 million, compared to $203.8 million in the prior year[6]. - The net profit attributable to shareholders decreased by 13.6% to $149.2 million from $172.7 million[6]. - Basic earnings per share decreased by 13.7% to 59.1 cents, compared to 68.5 cents in the fiscal year 2022[10]. - Total operating expenses decreased from $464.8 million to $454.9 million, representing an increase in the percentage of total revenue from 19.6% to 20.3%[22]. - The net profit attributable to shareholders for the fiscal year was $149.2 million, down $23.5 million or 13.6%, resulting in a net profit margin decline from 7.3% to 6.7%[26]. Cash Flow and Capital Expenditure - Cash generated from operations increased significantly by 51.9% to $276.1 million, up from $181.8 million[6]. - The company maintained a cash and cash equivalents balance of $198.5 million, a slight increase of 1.4% from $195.8 million[6]. - Capital expenditure was reduced by 22.3% to $27.9 million, down from $35.9 million[6]. - Capital commitments for the fiscal year 2024 are projected to be $40.8 million, also funded from internal resources[40]. Market Performance and Challenges - The challenging macroeconomic environment in North America and Europe negatively impacted sales of electronic learning and telecommunications products, leading to a decline in revenue and profit[9]. - North America revenue was $984.8 million, down 7.8% from $1,068.5 million, while Europe revenue decreased by 10.5% to $917.0 million from $1,025.1 million[20]. - The operating environment in fiscal year 2023 was challenging, with high inflation and rising interest rates affecting consumer confidence in North America and Europe[11]. - Revenue in North America decreased by 7.8% to $984.8 million, primarily due to declines in sales of electronic learning and telecommunications products[43]. Product Development and Innovation - The group maintained its leadership position in the global market for infant and preschool electronic learning toys[11]. - The group successfully launched the Magic Adventures™ Microscope, contributing to additional revenue growth[11]. - New product launches, including revamped Go! Go! Smart/Toot-Toot series and expanded licensed product lines, are expected to drive growth in North America and Europe in fiscal year 2024[15]. - The introduction of new licensed character CoComelon is anticipated to inject more momentum into the core learning product series[15]. Sustainability and Corporate Responsibility - The company is committed to sustainability, with over 95% of electronic learning product packaging materials being recyclable and approximately 85% made from recycled materials[12]. - The company is focused on creating sustainable value by integrating economic growth, environmental protection, and social responsibility into its business strategy[13]. - The company aims to adopt more sustainable materials, implement responsible product recycling, and utilize environmentally friendly transportation methods in its supply chain management[101]. - The company has established a vision and strategic direction for sustainable development activities[129]. Governance and Board Structure - The board of directors consists of nine members, with five being independent non-executive directors, exceeding the requirement of at least one-third[105]. - The board has established four committees: Audit Committee, Nomination Committee, Remuneration Committee, and Risk Management and Sustainability Committee, to handle specific matters[125]. - The company has implemented a robust governance framework to ensure effective execution of strategies and policies, safeguarding long-term shareholder interests[103]. - The board emphasizes the importance of risk management and internal controls, reviewing financial, operational, and compliance matters[114]. Employee Engagement and Diversity - In the fiscal year 2023, 41% of the global workforce are women, with 26% of management positions held by women[130]. - The company aims to achieve a minimum of 25% female representation in management positions[130]. - The nomination committee will continue to actively seek suitable candidates to enhance board diversity, particularly focusing on gender diversity[130]. Risk Management - The company has established a business continuity management system to identify potential disruptions and implement risk mitigation measures[183]. - The group has implemented a continuous process to identify, assess, and monitor major risks, ensuring effective operation of these procedures[189]. - The risk register is reviewed biannually by the Risk Management and Sustainability Committee to address key operational risks[150]. Awards and Recognition - The company received multiple awards for its electronic learning products, highlighting its continued innovation and market presence[44]. - The group achieved an AA rating in the Hang Seng Sustainability Index and an A rating in MSCI ESG ratings, reflecting its commitment to sustainability[84]. - The company has been awarded multiple accolades for its sustainability efforts, including the "Best Sustainability Company" award from the Hong Kong Institute of Certified Public Accountants[101].

Financial Performance - Group revenue decreased by 5.4% to $2,241.7 million, compared to $2,370.5 million in the previous fiscal year[3] - Profit attributable to shareholders fell by 13.6% to $149.2 million, down from $172.7 million[4] - Basic and diluted earnings per share decreased to 59.1 cents from 68.5 cents[4] - Operating profit declined to $180.5 million from $203.8 million[4] - The company reported a total comprehensive income of $174.7 million for the year ended March 31, 2023, compared to $172.7 million for the previous year, reflecting a slight increase[7] - The pre-tax profit for the year 2023 was reported at $149.2 million, a decrease from $172.7 million in 2022, representing a decline of approximately 13.5%[22] - The net profit attributable to shareholders for the fiscal year was $149.2 million, down $23.5 million or 13.6%, resulting in a net profit margin decline from 7.3% to 6.7%[48] Dividends - Total dividend per ordinary share for the year was 59.0 cents, with a final dividend of 42.0 cents per share[3] - The board proposed a final dividend of 42.0 cents per share, resulting in a total annual dividend of 59.0 cents per share, a decrease of 13.2% from 68.0 cents in the previous fiscal year[32] - The company paid dividends totaling $171.8 million during the year, down from $229.7 million in the previous year, reflecting a reduction in cash outflow[8] - The interim dividend declared was $42.9 million for both 2023 and 2022, maintaining the same level[21] - The proposed final dividend for 2023 is $106.1 million, down from $128.7 million in 2022, representing a decrease of approximately 17.6%[21] Revenue Breakdown - Revenue from electronic learning products was $891.4 million, down from $1,025.5 million, reflecting a decrease of about 13.1%[11][12] - The North America segment generated $984.8 million in revenue, a decrease of 7.8% from $1,068.5 million in the prior year[11][12] - The Europe segment reported revenue of $917.0 million, down from $1,025.1 million, indicating a decline of approximately 10.6%[11][12] - The Asia-Pacific region contributed $315.8 million in revenue, a decrease of 22.8% from $255.0 million in the previous year[11][12] - Revenue in Europe decreased by 10.5% to $917 million, accounting for 40.9% of the group's total revenue[64] - Revenue in the Asia-Pacific region rose by 23.8% to $315.8 million, supported by increased sales in telecommunications and contract manufacturing services[68] Expenses and Costs - Operating expenses for the fiscal year were $454.9 million, representing 20.3% of total revenue, compared to 19.6% in the previous year[43] - Research and development expenses were $83.3 million, slightly down from $84.3 million[4] - Total operating expenses decreased from $464.8 million to $454.9 million, with the percentage of total revenue rising from 19.6% to 20.3%[47] - The total tax expense for the year was $19.3 million in 2023, compared to $21.9 million in 2022, indicating a reduction of about 11.9%[19] Assets and Liabilities - Total assets decreased to $1,008.8 million from $1,142.2 million[6] - Total equity decreased to $634.7 million from $678.8 million[6] - The company reported total liabilities of $(683.7) million, down from $(807.9) million in the prior year[17] - As of March 31, 2023, total shareholder equity was $634.7 million, down 6.5% from $678.8 million, with net cash increasing from $195.8 million to $198.5 million, a rise of 1.4%[50] Inventory and Receivables - The company experienced a decrease in inventory by $77.8 million, compared to an increase of $139.3 million in the previous year, showing improved inventory management[8] - Total accounts receivable, deposits, and prepayments amounted to $324.3 million in 2023, a decrease from $384.9 million in 2022, reflecting a decline of approximately 15.7%[24] - Accounts receivable fell from $325.4 million to $277.2 million, with turnover days decreasing from 65 days to 59 days[54] Market and Operational Challenges - The operating environment was challenging due to high inflation and rising interest rates, affecting consumer confidence in North America and Europe[34] - The company faced supply chain issues, particularly with semiconductor shortages impacting product availability, although some key component supplies improved during the fiscal year[34] - The telecommunications product sales decreased, with commercial phones and other telecommunications products representing 57% of total telecommunications revenue in fiscal year 2023, down from 59% in fiscal year 2022[35] Strategic Initiatives - The company is advancing towards Industry 4.0, optimizing supply chains and production processes through machine learning, AI, and automation[37] - The restructuring of electronic learning and telecommunications operations aims to create a more efficient organization that can respond quickly to market changes[39] - The company is enhancing its manufacturing capabilities in Mexico to meet higher demand for emergency production facilities outside of China[37] Sustainability Efforts - The company is committed to sustainable practices, including the installation of solar panels and the use of water-based coatings to reduce VOC emissions[38] - Over 95% of the packaging materials for electronic learning products are recyclable, with approximately 85% made from recycled materials[38]

Financial Performance - For the first half of the fiscal year 2023, VTech Holdings reported a revenue increase of 4.5% to $1.1648 billion, up from $1.1148 billion in the same period last year[2]. - The net profit attributable to shareholders rose by 6.6% to $82 million, compared to $77 million in the previous fiscal year[2]. - Gross margin improved to 28.3%, up from 27.4% in the same period last year, primarily due to a decrease in material costs and direct labor costs[2]. - Operating profit for the six months ended September 30 was $99.0 million, an increase of $8.2 million from the previous year, with an operating margin of 8.5%[15]. - Total comprehensive income for the period was $33.0 million, down from $82.0 million in the previous year, indicating a decline of 59.9%[25]. - The company reported a profit of $82.0 million for the six months ended September 30, 2022, compared to $76.9 million for the same period in 2021, representing a growth of 1.4%[25]. Market Performance - North America remains VTech's largest market, accounting for 45.5% of total revenue, with sales in this region increasing by 6.5% to $530.5 million[2]. - Sales of electronic learning products in North America increased by 4.5% to $266.5 million, driven by strong demand for the KidiZoom® camera series and new learning watches[3]. - The telecommunications segment in North America saw a revenue decline of 5.6% to $123.9 million, primarily due to decreased sales of commercial and home phones[4]. - Revenue in Europe decreased by 3.2% to $470.4 million, with electronic learning products' sales rising by 5.4% to $159.3 million, but not enough to offset declines in telecommunications products[7]. - The sales of baby monitors in the U.S. increased due to expanded shelf space and popularity of new product lines, solidifying market leadership in North America[6]. - In the first six months of the fiscal year 2023, the Asia-Pacific region's revenue increased by 27.9% to $152.2 million, with all product categories showing growth[10]. Product Development and Innovation - New product launches, including the Level Up Gaming Chair™ and Clean Sweep Learning Caddy™, received recognition in holiday gift guides and toy awards[4]. - The company's electronic learning products received multiple awards, including the "Toy of the Year" for the Magic Adventures Microscope[8]. - Revenue from electronic learning products in the Asia-Pacific region increased by 6.9% to $41.9 million, driven by sales growth in Australia and Japan, offsetting declines in mainland China[11]. Strategic Initiatives - VTech has expanded its production facilities in Malaysia and Mexico to enhance competitiveness and prepare for future growth[2]. - The company announced an interim dividend of 17.0 cents per share, consistent with the previous fiscal year's interim dividend[2]. - VTech's strategy includes restructuring production bases to improve efficiency and global competitiveness, initiated since 2018[2]. - The company plans to invest in new product development and market expansion to drive future growth despite economic uncertainties[14]. Financial Outlook and Challenges - The company expects a complex and volatile operating environment for the second half of the fiscal year, with high energy costs and inflation persisting[14]. - The company has revised its full-year outlook, now anticipating a year-on-year revenue decline, while gross margins are expected to remain stable[14]. - Revenue for electronic learning products is now projected to decline for the full year, contrary to previous expectations of moderate growth[14]. Corporate Governance and Compliance - The company maintains a commitment to good corporate governance, emphasizing transparency, accountability, and independence[82]. - The company has complied with all corporate governance codes as of September 30, 2022, and has adhered to most recommended best practices[83]. - The risk management and internal control mechanisms have been continuously reviewed to ensure compliance with applicable laws and regulations[83]. - The company has implemented additional preventive measures and technical improvements to mitigate cybersecurity risks[83]. Shareholder Information - The company declared an interim dividend of 17.0 US cents per ordinary share for the six months ended September 30, 2022, to be paid on December 15, 2022[84]. - The company has a dedicated investor relations email: investor_relations@vtech.com[91]. - The company is incorporated in Bermuda with limited liability[91]. - The main registered office is located at 23rd Floor, Tai Ping Industrial Centre, Block 1, 57 Ting Kok Road, Tai Po, New Territories, Hong Kong[91].

Financial Performance - The group's revenue for the fiscal year ended March 31, 2022, slightly decreased by 0.1% to $2,370.5 million from $2,372.3 million in the previous fiscal year[9]. - The profit attributable to shareholders dropped by 25.2% to $172.7 million, primarily due to significant cost increases leading to a decline in gross profit[9]. - The gross profit margin for the fiscal year was 28.2%, down from 30.6% in the previous fiscal year[10]. - Basic earnings per share decreased by 25.2% to 68.5 cents, compared to 91.6 cents in the previous fiscal year[9]. - Operating profit fell by 23.4% to $203.8 million from $266.2 million in the previous fiscal year[5]. - The group's cash generated from operations was $181.8 million, a decrease of 41.5% compared to $310.9 million in the previous fiscal year[5]. - Gross profit for the fiscal year was $669.1 million, a decrease of $57.5 million or 7.9% from the previous year, with the gross margin dropping from 30.6% to 28.2%[21]. - Net profit attributable to shareholders was $172.7 million, a decrease of $58.2 million or 25.2%, resulting in a net profit margin of 7.3% compared to 9.7% in the previous year[24]. Dividends - The board proposed a final dividend of 51.0 cents per share, resulting in a total annual dividend of 68.0 cents, a reduction of 25.3% from 91.0 cents in the previous fiscal year[9]. - The company announced an interim dividend of $0.17 per share and proposed a final dividend of $0.51 per share, totaling $0.68 for the fiscal year, down from $0.91 in the previous year[26]. - The dividend payout ratio for the fiscal year 2022 was maintained at 99.4% of the company's profit attributable to shareholders, indicating a strong commitment to shareholder returns[177]. Market and Product Performance - Online sales increased, contributing to 15.4% of total revenue, with the electronic learning products business achieving record sales exceeding $1 billion in the fiscal year 2022[12]. - The sales of independent products accounted for 84% of total electronic learning product sales, up from 82% in the previous fiscal year[13]. - The telecommunications product segment saw growth in commercial phones and other telecom products, with their revenue percentage increasing from 49% to 59% of total telecom product revenue[13]. - Despite challenges, the company maintained its leading position in the U.S. baby monitor market, supported by strong demand for infant and preschool products[13]. - The company successfully launched the new product series Marble Rush™, which won multiple awards and generated additional revenue[13]. Supply Chain and Operational Challenges - The company faced production and supply chain disruptions due to the COVID-19 pandemic, along with increased costs from global material and shipping container shortages[8]. - Gross margin decreased significantly due to unprecedented increases in shipping costs caused by global container shortages, along with higher direct labor costs and production expenses compared to the previous fiscal year[12]. - Semiconductor shortages negatively impacted sales of children's educational tablets, while the LeapFrog Academy™ subscription volume also declined due to supply issues[13]. - The company took measures to mitigate supply chain disruptions, including redesigning products to reduce costs and increasing inventory of key components[12]. Sustainability Initiatives - The company launched its first eco-friendly electronic learning product line, utilizing plant-based plastics, recycled plastics, and FSC-certified wood[14]. - Over 94% of the packaging materials for electronic learning products are recyclable, with approximately 85% made from recycled materials[14]. - The company has established a five-year sustainability plan, "Sustainability Plan 2025," with measurable objectives and targets for each fiscal year from 2021 to 2025[80]. - The company aims to use more sustainable materials in product manufacturing and adopt environmentally friendly transportation methods in supply chain management[80]. - The company has implemented various green manufacturing and sustainable supply chain initiatives to address climate change[91]. Corporate Governance - The company has maintained compliance with the corporate governance code as per the Hong Kong Stock Exchange, with a commitment to transparency and accountability[85]. - The board of directors has adopted an organized procedure for performance evaluation every two years since 2017, focusing on the effectiveness and contributions of the board members[107]. - The company has established a risk management committee in 2002, which was renamed the Risk Management and Sustainability Committee in May 2013, to oversee risk management and sustainability strategies[88]. - The board consists of three executive directors, one non-executive director, and four independent non-executive directors, ensuring a diverse skill set and experience[99]. Community Engagement and Social Responsibility - The company actively promotes a culture of accountability and community service, focusing on supporting those in need[170]. - The company donated over 4,400 electronic learning toys to children in need as part of its collaboration with Save the Children[170]. - The company contributed over $193,000 to charitable activities in the fiscal year 2022, receiving multiple awards for its corporate social responsibility efforts[170]. - Over 2,600 volunteers were recruited, contributing more than 21,000 hours of community service in the fiscal year 2022[170]. Future Outlook - The company anticipates moderate revenue growth for electronic learning products in the fiscal year 2023, driven by a strong product portfolio and improved inventory management[15]. - The company provided an optimistic outlook for the next fiscal year, projecting a revenue growth of 10% to 12% driven by new product launches and market expansion strategies[185]. - The company plans to expand its market presence in Southeast Asia, targeting a 30% increase in market share within the next two years[185].

Financial Performance - For the first half of the fiscal year 2022, VTech's revenue decreased by 0.8% to $1.148 billion compared to $1.1236 billion in the same period last year[2]. - The gross profit margin for the first half of the fiscal year 2022 was 27.4%, down from 31.8% in the same period last year, primarily due to rising material prices[3]. - Net profit attributable to shareholders dropped by 37.8% to $76.9 million, mainly due to significant cost increases and a decline in revenue from electronic learning products and telecommunications products[3]. - Basic earnings per share decreased by 37.8% to 30.5 cents, compared to 49.0 cents in the same period last year[3]. - Operating profit for the six months ended September 30, 2021, was $90.8 million, a decrease of $51.8 million or 36.3% compared to the same period last year[23]. - The total segment profit for the six months ended September 30, 2021, was $90.8 million, compared to $142.6 million in 2020, a decline of 36.3%[43]. - The company reported a decrease in equity from $731.1 million on April 1, 2021, to $628.4 million on September 30, 2021[34]. Revenue by Region - Revenue in North America increased by 1.0% to $497.9 million, despite declines in Europe, Asia-Pacific, and other regions[3]. - In the first six months of the fiscal year 2022, VTech's revenue from telecommunications products in North America increased by 0.8% to $131.3 million, driven by a rise in commercial phone sales as business activities resumed[4]. - In Europe, VTech's revenue decreased by 0.3% to $485.8 million, primarily due to declines in electronic learning and telecommunications products, despite growth in contract manufacturing services[7]. - The group's revenue in the Asia-Pacific region decreased by 8.6% to $119 million, with declines in electronic learning products, telecommunications products, and contract manufacturing services[11]. Product Performance - The sales of electronic learning products in North America fell by 8.3% to $255.5 million due to material shortages and supply chain issues[3]. - Electronic learning product sales in Europe fell by 4.1% to $151.1 million, with both independent and platform products experiencing declines due to material shortages and logistics issues[7]. - The independent product sales of VTech and LeapFrog brands both declined, with VTech's sales of KidiZoom® cameras and Switch & Go® Dinos series experiencing a drop, while infant products remained stable[4]. - LeapFrog's independent product sales increased, driven by growth in infant and preschool products, along with the launch of LeapLand Adventures[7]. Supply Chain and Operational Challenges - The company faced challenges due to key component shortages and supply chain disruptions caused by the COVID-19 pandemic, impacting production and order fulfillment[2]. - The changes in product mix also contributed to the decline in gross profit margin[3]. - The company has implemented measures to mitigate supply chain disruptions, including redesigning products to reduce costs and securing long-term contracts with suppliers[18]. Dividends and Shareholder Returns - The board declared an interim dividend of 17.0 cents per share, unchanged from the interim dividend declared in the same period last year[3]. - The company declared dividends totaling $186.8 million during the period[34]. - The interim dividend declared per share is 17.0 cents, consistent with the previous year, totaling $42.9 million for the six months ended September 30, 2021[49]. Financial Position and Assets - Cash and cash equivalents as of September 30, 2021, were $25.8 million, a significant decrease of 81.2% from $137.1 million year-over-year[26]. - Inventory increased to $599.4 million, up $163.3 million or 37.4% compared to the previous fiscal year, with turnover days rising from 120 to 141 days[27]. - Accounts receivable rose to $507.9 million, an increase of $13.8 million or 2.6%, with turnover days increasing from 60 to 66 days[27]. - The total assets as of September 30, 2021, amounted to $1,230.9 million, an increase from $1,156.1 million in 2020, reflecting a growth of approximately 6.4%[32]. Corporate Governance and Compliance - The company emphasizes good corporate governance, focusing on transparency, accountability, and independence[81]. - The company has complied with all provisions of the corporate governance code during the six months ended September 30, 2021[82]. - The risk management and internal control systems have been reviewed and deemed effective and sufficient as of September 30, 2021[82]. Future Outlook - The group expects sales of electronic learning and telecommunications products to rebound in the second half of the fiscal year due to strong order performance and improved inventory levels[16]. - The company anticipates improved sales for telecommunications products in the second half of the fiscal year due to new product launches, despite ongoing global material supply shortages[18].

Revenue Performance - For the six months ended September 30, 2020, the group's revenue was $1.1236 billion, slightly down from $1.1241 billion in the same period last year[5]. - Revenue in North America decreased by 5.6% to $492.9 million, with a decline in contract manufacturing services offsetting gains in electronic learning and telecommunications products[9]. - Revenue in Europe increased by 10.6% to $487.5 million, driven by sales growth in electronic learning products and contract manufacturing services, offsetting declines in telecom products[14]. - Revenue in the Asia-Pacific region decreased by 8.2% to $130.2 million, accounting for 11.6% of the group's total revenue[18]. - Revenue in other regions (Latin America, Middle East, and Africa) decreased by 34.0% to $13 million, representing 1.1% of total revenue[20]. - Overall group revenue for the six months ended September 30 was $1,123.6 million, a slight decrease from $1,124.1 million in the previous fiscal year[22]. Profitability - Profit attributable to shareholders increased by 4.7% to $123.6 million, primarily due to a decrease in costs leading to higher gross profit[5]. - The gross profit margin improved to 31.8% from 30.7% in the same period last year, benefiting from lower material prices and favorable currency exchange rates[6]. - Operating profit rose by $7.7 million or 5.7% to $142.6 million, with an operating margin increase from 12.0% to 12.7%[27]. - Net profit attributable to shareholders increased by $5.6 million or 4.7% to $123.6 million, with a net profit margin rise from 10.5% to 11.0%[30]. Dividends - The company announced an interim dividend of 17.0 cents per share, consistent with the dividend paid in the first half of the previous fiscal year[5]. - The company declared an interim dividend of $0.17 per share for the six months ended September 30, 2020, to be paid on December 14, 2020[92]. Segment Performance - Electronic learning product revenue in North America increased by 9.8% to $278.1 million, reflecting a strong position in the market due to increased time spent at home during the pandemic[9]. - Telecommunications product revenue in North America rose by 3.7% to $130.2 million, driven by increased sales of home phones as consumers upgraded their landline systems[10]. - Contract manufacturing services in North America saw a revenue decrease of 40.9% to $84.6 million, primarily due to negative impacts from the pandemic[12]. - Electronic learning products in Europe saw an 8.2% revenue increase to $157.6 million, with growth in independent and platform products[14]. - Telecom products in Europe experienced an 8.4% revenue decline to $52.5 million, with decreases in home phones, commercial phones, and other telecom products[15]. - Contract manufacturing services in Europe increased by 16.8% to $277.4 million, with sales growth in ear-worn devices and medical products[15]. Financial Position - Cash and cash equivalents as of September 30, 2020, were $137.1 million, with no debt reported[32]. - Total assets amounted to $1,156.1 million, an increase from $1,104.0 million in 2019[38]. - Total liabilities were reported at $666.5 million, down from $699.8 million in 2019, indicating a reduction in financial obligations[38]. - The net asset value increased to $649.1 million from $568.3 million in the previous year, reflecting a strong financial position[38]. Research and Development - Research and development expenses increased by 2.5% to $41.7 million, representing 3.7% of total revenue[28]. - Research and development expenses for the period were $40.4 million, slightly higher than $39.2 million in the same period of 2019[37]. Market Outlook - The group expects no revenue growth for the full fiscal year but anticipates an increase in gross margin[21]. - Future guidance indicates a cautious outlook due to market uncertainties but aims for steady revenue growth[37]. Operational Efficiency - The company continues to monitor segment performance and allocate resources accordingly to enhance operational efficiency and profitability[47]. - The company has identified key operational risks including economic and operational risks related to the COVID-19 pandemic, employee and supplier conduct, and cybersecurity risks[89]. Compliance and Governance - The company has complied with the corporate governance code and most recommended best practices during the reporting period[86]. - The audit committee held two meetings during the financial period, including participation from the CEO and external auditors[86]. - The company reported that its internal control mechanisms are effective and sufficient for financial and operational monitoring[87].

Revenue Growth - For the first six months of the fiscal year 2020, VTech's revenue increased by 12.0% to $1.1241 billion, driven by sales growth in North America, Europe, and Asia-Pacific[2]. - North America remains VTech's largest market, accounting for 46.4% of total revenue, with a revenue increase of 11.0% to $522.9 million due to higher sales of electronic learning products and contract manufacturing services[2]. - Revenue in Europe increased by 10.0% to $440.6 million, accounting for 39.2% of the group's total revenue[6]. - Revenue in the Asia-Pacific region increased by 26.6% to $141.9 million, with electronic learning products and contract manufacturing services driving growth[12]. - Revenue in other regions decreased by 5.7% to $19.7 million, with declines in electronic learning and telecommunications products[10]. - The total revenue for the six months ended September 30, 2019, was $1,124.1 million, with North America contributing $521.9 million, Europe $440.6 million, Asia-Pacific $141.9 million, and other regions $19.7 million[50]. Profit and Margins - The profit attributable to shareholders increased by 31.0% to $118 million, primarily due to revenue and gross profit growth, as well as a decrease in operating expenses as a percentage of revenue[2]. - The gross profit margin improved from 29.5% to 30.7%, benefiting from lower material prices and improved productivity[2]. - Operating profit for the six months ended September 30, 2019, was $134.9 million, up $34.6 million or 34.5%, with an operating margin increasing from 10.0% to 12.0%[21]. - The overall operating expenses as a percentage of total revenue decreased from 20.1% to 19.4%[21]. Product Performance - The sales of electronic learning products in North America rose by 20.1% to $253.2 million, supported by strong performance from new product launches[2]. - New product launches, including Smart Sizzlin' BBQ Grill™, LeapStory™, and Learn & Groove® Dancing Panda™, contributed to sales growth in the electronic learning segment[2]. - Sales of electronic learning products in Europe rose by 12.9% to $145.7 million, driven by new product popularity despite currency weakness[6]. - The sales of the Snom brand's new VoIP products contributed to overall growth in the telecommunications segment despite declines in other areas[4]. Dividends and Shareholder Returns - The company announced an interim dividend of $0.17 per share, consistent with the previous year[2]. - The board declared an interim dividend of 17.0 cents per share, totaling an estimated $42.8 million[26]. - The company declared an interim dividend of 17.0 US cents per share for the six months ended September 30, 2019, to be distributed on December 16, 2019[95]. Challenges and Strategic Responses - The company faced challenges from ongoing US-China trade tensions, but implemented measures to mitigate the impact of tariffs on its business[2]. - The group plans to continue expanding production capacity in Malaysia to mitigate the impact of U.S. tariffs on contract manufacturing services[14]. - The group is focused on product innovation, market share expansion, and operational excellence to maintain competitiveness amid ongoing U.S.-China trade tensions[15]. Financial Position and Assets - The net cash position as of September 30, 2019, was $102.5 million with no debt, indicating strong financial resources[26]. - Total assets reported were $1,310.4 million, compared to $1,017.4 million, indicating a significant increase[60]. - The company reported a total equity of $568.3 million as of September 30, 2019[36]. - The company reported a cash flow from operating activities of $41.0 million for the six months ended September 30, 2019[33]. Accounting Standards and Changes - The company adopted IFRS 16 "Leases" during the reporting period, which may impact future financial statements[38]. - The adoption of IFRS 16 resulted in the recognition of right-of-use assets of $127.9 million and lease liabilities of $137.8 million as of September 30, 2019[28]. - The group capitalized lease liabilities based on the present value of remaining lease payments, which includes initial direct costs and any lease incentives received[41]. Risk Management - The risk management and sustainability committee held two meetings during the financial period to review the group's risk management and internal control systems[92]. - Major risks include employee and supplier conduct, product design and safety, sales and receivables management, and compliance with legal regulations[93]. - The company has taken steps to report the data breach incident to relevant authorities and has ensured the security of customer data[82]. Shareholder Information - As of September 30, 2019, the total number of issued shares was 251,779,133, with major shareholders including Credit Suisse Trust Limited holding 74,101,153 shares, representing approximately 29.43%[88]. - The company’s directors and senior executives hold a total of 87,724,229 shares, representing approximately 34.84% of the total shares[86].