Vtech 2016 Annual Report Download - page 56

Notes to the Financial Statements
52 VTech Holdings Limited Annual Report 2016
1 Segment Information
The principal activity of the Group is design, manufacturing and
distribution of consumer electronic products.
The Group manages its businesses by divisions, which are
organised by geography. In accordance with IFRS 8 – Operating
segments and in a manner consistent with the way in which
information is reported internally to the Group’s most senior
executive management for the purposes of resource allocation and
performance assessment, the Group has presented the following
reportable segments.
• North America (including the United States and Canada)
• Europe
• Asia Paci c
• Others, which covers sales of electronic products to the rest of
the world
The Company is domiciled in Bermuda. The results of its revenue
from external customers located in North America, Europe, Asia
Paci c and elsewhere are set out in the table below.
Each of the above reportable segments primarily derives its
revenue from the sale of telecommunication products, electronic
learning products and products from contract manufacturing
services to customers in the relevant geographical region.
All of these products are manufactured in the Group’s
manufacturing facilities located primarily in the People’s Republic
of China (“PRC”) under the Asia Paci c segment.
For the purposes of assessing segment performance and allocating
resources between segments, the Group’s senior executive
management monitors the results and assets attributable to each
reportable segment on the following bases:
(a) Segment revenues and results
Revenue is allocated to the reportable segment based on the
location of external customers. Expenses are allocated to the
reportable segments with reference to sales generated by those
segments and the expenses incurred by those geographical
locations or which otherwise arise from the depreciation or
amortisation of assets attributable to those segments.
The measure used for reporting segment pro t is operating pro t.
In addition to receiving segment information concerning operating
pro t, management is provided with segment information
concerning revenue and depreciation and amortisation.
(b) Segment assets and liabilities
Segment assets include all tangible and intangible assets and
current assets with the exception of deferred tax assets and other
corporate assets including taxation recoverable and investments.
Segment liabilities include creditors and accruals and provisions for
defective goods returns and other liabilities with the exception of
taxation payable.
Year ended 31 March 2016 North America
US$ million
Europe
US$ million
Asia Pacific
US$ million
Others
US$ million
Total
US$ million
Reportable segment revenue 878.3 795.9 129.0 53.3 1,856.5
Reportable segment profit 97.1 79.3 18.9 7.0 202.3
Depreciation and amortisation 0.7 0.5 33.9 – 35.1
Reportable segment assets 141.6 81.3 678.1 0.1 901.1
Reportable segment liabilities (46.3) (24.0) (311.5) (0.1) (381.9)
Year ended 31 March 2015 North America
US$ million
Europe
US$ million
Asia Pacific
US$ million
Others
US$ million
Total
US$ million
Reportable segment revenue 899.5 812.3 117.6 50.4 1,879.8
Reportable segment profit 89.1 105.8 17.2 8.0 220.1
Depreciation and amortisation 0.6 0.6 30.4 – 31.6
Reportable segment assets 162.2 67.6 686.4 0.1 916.3
Reportable segment liabilities (41.7) (21.8) (309.1) (0.3) (372.9)
(c) Reconciliations of reportable segment assets and
liabilities
Note
2016
US$ million
2015
US$ million
Assets
Reportable segment assets 901.1 916.3
Investments 3.1 0.1
Taxation recoverable 11(a) 2.3 –
Deferred tax assets 11(b) 4.0 4.5
Consolidated total assets 910.5 920.9
Liabilities
Reportable segment liabilities (381.9) (372.9)
Taxation payable 11(a) (3.6) (7.2)
Consolidated total liabilities (385.5) (380.1)
For the year ended 31 March 2016, approximately 12% (2015: 13%)
of the Group’s revenue is derived from a single external customer.
Such revenue is attributable to the North America segment.
Details of concentrations of credit risk of the Group are set out in
note 20(a).