Vtech 2012 Annual Report Download - page 19

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North America
The Group’s revenue in North
America rose by 3.3% to US$903.5
million in the financial year 2012,
as higher revenue from CMS and ELPs
offset a slight decrease in revenue from
TEL products. North America remains the
largest market for the Group, accounting
for 50.6% of Group revenue.
Revenue from TEL products declined 1.4%
to US$415.3 million. Sales of branded
corded and cordless phones were lower,
as the residential phone market in the US
is mature. During the financial year 2012,
VTech continued to maintain its number
one position in the US corded and cordless
phone market2.
In view of the maturity of the residential
phone market, we have introduced
products in the commercial phone area,
entering the SMB phone segment in 2009.
These products are gaining increasing
traction in the market. Particularly well-
received has been our small business
phone system, SynJ®, which offers a unique
solution for operations such as warehouses,
restaurants and retail shops. This system
is being successfully marketed via office
super stores, an expanding network of
online retailers and value added resellers.
Following our success in opening
up the SMB phone market, we have
expanded to the hospitality industry. We
started shipping our first hotel phones
to customers in the second half of the
financial year 2012. In March 2012, we
completed installation of SIP (Session
Initiation Protocol) phones in the Octavius
Tower™ at Caesars Palace® in Las Vegas.
Hotel Phones
In addition to Caesars Palace, the Group
is shipping hotel phones to major
hotel chains such as Hilton, Hyatt and
Mandarin Oriental.
This marked an important milestone in our
expansion into this new segment.
In February 2012, we launched two
new baby monitors, the Safe & Sound™
Full-Colour Video and Audio Monitor and
the Safe & Sound™ Digital Audio Monitor.
Both products offer robust features at
affordable price points and the new
product area adds another growth avenue
in TEL products.
Revenue from our ELPs in North America
rose by 7.5% to US$308.5 million in the
financial year 2012, driven by growth in
platform products. Sales via online retailers
were especially strong.
The full launch of InnoTab, an educational
tablet for children in October 2011,
provided a major boost to our platform
sales. Despite having the highest retail
price among our three platform consoles,
InnoTab has sold well, more than
compensating for the lower sales of MobiGo
and V.Reader® during the financial year.
Sales of standalone products during the
financial year 2012 were essentially flat.
Higher sales of pre-school products were
offset by lower sales of infant products.
Revenue from CMS in North America grew
by 7.8% during the financial year 2012
to US$179.7 million. Professional audio
equipment and internet phones for office
use were major growth drivers. Higher
sales of commercial solid-state lighting also
supported growth.
Revenue in North America in Last
5 Years
1,000
800
600
400
200
0
US$ million
08 09 10 11 12
868.2
772.8
872.6 874.9 903.5
2 MarketWise Consumer Insights, LLC
17
VTech Holdings Ltd Annual Report 2012