VTech has announced results for the year ended 31st March 2019, reporting a strong performance of electronic learning products.
Allan Wong, chairman and group CEO stated: “The financial year 2019 saw both achievements and challenges for VTech. Electronic Learning Products delivered a slight sales increase despite the absence of Toys R Us in many of the Group’s major markets.”
Group revenue in Europe increased by 4.0% to US$882.9m in the financial year 2019 and Europe remained VTech’s second largest market, accounting for 40.8% of Group revenue.
ELPs revenue in Europe showed a 5.4% decrease to US$343.5m. All the Group’s major European markets reported lower sales, due to tough market conditions in most key European markets. Logistics issues in continental Europe in the first half of the financial year 2019 resulted in lower shipment of products and lower sales. However, the Group successfully resolved the logistics issues in the second half of the financial year, recouping most of the sales lost. In 2018, VTech maintained its position as the No. 1 infant and toddler toy manufacturer in France, the UK and Germany.
North America was VTech’s largest market, accounting for 46% of Group revenue, which decreased by 4.5% to US$994.5m. Group revenue in Asia Pacific increased by 26.1% to US$248.6m in the financial year 2019, and Group revenue in Other Regions, namely Latin America, the Middle East and Africa, fell by 16.3%.
For the next financial year, VTech is assessing the likely impact of tariffs which may be applied to Chinese imports and taking steps to mitigate it. This includes expanding newly acquired production facilities in Malaysia.
The Group aims to strengthen its leadership in the ELP market in North America and Europe through new product launches. Continued growth in Australia and mainland China will support higher sales in Asia Pacific.
“VTech has the dedicated teams globally, solid R&D capabilities and strong balance sheet to cope with the current uncertainties and deliver increasing value to shareholders,” added Allan Wong.