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VTech Holdings Ltd Annual Report 2006 01
VTech is one of the world’s largest suppliers of corded and cordless
telephones and a leading supplier of electronic learning products.
It also provides highly sought-after contract manufacturing services.
Founded in 1976, the Group’s mission is to be the most cost
effective designer and manufacturer of innovative, high quality
consumer electronics products, and to distribute them to markets
worldwide in the most efficient manner.
With headquarters in the Hong Kong Special Administrative Region
and state-of-the-art manufacturing facilities in mainland China,
VTech currently has a presence in 10 countries and approximately
30,000 employees, including around 1,000 R&D professionals in
R&D centres in Canada, Hong Kong SAR and mainland China. This
network allows VTech to stay abreast of the latest technology and
market trends throughout the world, while maintaining a highly
competitive cost structure.
The Group invested US$40.3 million in R&D in the financial year
2006 and launches numerous new products each year. VTech sells
its products via a strong brand platform supported by an extensive
distribution network of leading retailers in North America, Europe
and Asia. Apart from the well-known VTech brand, the Group has
the rights to use the AT&T brand in connection with the
manufacture and sale of its wireline telephones and accessories.
In addition, VTech has license agreements with licensors of well-
known children’s characters that allow it to use those characters
in the cartridges for its popular V.Smile product range and certain
electronic learning products.
Shares of VTech Holdings Limited are listed on both the Hong Kong
and London stock exchanges (HKSE: 303; LSE: VTH). Ordinary shares
are also available in the form of American Depository Receipts (ADRs)
through the Bank of New York (ADR: VTKHY).
Corporate Profile
Contents
01 Corporate Profile
02 Financial Highlights
03 Letter to Shareholders
06 Message from Deputy Chairman
07 Management Discussion and Analysis
10 Review of Operations –
Telecommunication Products
12 Review of Operations –
Electronic Learning Products
16 Review of Operations –
Contract Manufacturing Services
18 Corporate Affairs
20 Year in Review
22 Corporate Governance Report
24 Directors and Senior Management
28 Report of the Directors
32 Report of the Independent Auditors
33 Consolidated Financial Statements
34 Notes to the Financial Statements
54 VTech in the Last Five Years
55 Corporate Information
56 Information for Shareholders