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Trade debtors as of 31 March 2014 were US$208.6 million, decreased from US$224.9
million as of 31 March 2013. Debtor turnover days improved from 62 days to 54 days.
The decrease in the trade debtor balance as at 31 March 2014 was mainly due to
continuous efforts to tighten debt collection and credit exposure management. The
amounts with overdue balances greater than 30 days accounted for 1.0% of the gross
trade debtors as of 31 March 2014.
As at 31 March 2014 and 2013
All figures are in US$ million unless stated otherwise 2014 2013
Trade debtors 208.6 224.9
Average trade debtors as a percentage of Group revenue 11.4% 11.7%
Turnover days 54 days 62 days
Other debtors, deposits and prepayments as of 31 March 2014 were US$27.2
million, compared to US$32.2 million as of 31 March 2013. The decline was mainly
attributable to the decrease in prepayments and the reversal of fair value gains on
forward foreign exchange contracts upon exercise.
Trade creditors as of 31 March 2014 were US$140.8 million, as compared to
US$176.2 million as of 31 March 2013. Creditor turnover days decreased from 85 days
to 78 days.
As at 31 March 2014 and 2013
All figures are in US$ million unless stated otherwise 2014 2013
Trade creditors 140.8 176.2
Turnover days 78 days 85 days
Other creditors and accruals as of
31 March 2014 were US$163.6 million,
increased from US$154.4 million as of
31 March 2013. The increase was largely
attributable to the increase in accruals
of advertising expenses and royalties, as
well as the increase in fair value losses on
forward foreign exchange contracts in
the financial year 2014.
Provisions as of 31 March 2014 were
US$27.9 million, as compared to US$28.2
million as of 31 March 2013.
Net obligations on defined benefit
scheme as of 31 March 2014 were
US$2.0 million, as compared to US$6.5
million as of 31 March 2013. The
decrease was mainly due to the
re-measurement of net liability of
defined benefit scheme.
Treasury Policies
The Group’s treasury policies are
designed to mitigate the impact
of fluctuations in foreign currency
exchange rates arising from the Group’s
global operations and to minimise
the Group’s financial risks. The Group
principally uses forward foreign
exchange contracts as appropriate for
risk management purposes only, for
hedging foreign exchange transactions
and for managing the Group’s assets
and liabilities. It is the Group’s policy not
to enter into derivative transactions for
speculative purposes.
Capital Expenditure
For the year ended 31 March 2014,
the Group invested US$30.1 million
in the purchase of tangible assets
including plant and machinery,
equipment, computer systems, as well
as the improvement of manufacturing
working environment. All of these
capital expenditures were financed from
internal resources.
Capital Commitments and
Contingencies
In the financial year 2015, the Group will
incur capital expenditure of US$34.7
million for ongoing business operations.
All of these capital expenditures will be
financed from internal resources.
As of the financial year end date, the
Group had no material contingencies.
10 VTech Holdings Limited Annual Report 2014
Management Discussion and Analysis Financial Review