Interim Management Statement

RNS Number:7367M
Vtech Holdings Limited
29 January 2008


                             VTech Holdings Limited
                (incorporated in Bermuda with limited liability)
                               (stock code : VTH)


VTech Holdings Limited - Interim Management Statement


In compliance with the requirements of the Disclosure and Transparency Rules
issued by the Financial Services Authority, VTech Holdings Limited ("VTech") is
publishing its second Interim Management Statement, for the nine months ended
31st December 2007.


The performance of the Group in the third quarter of the financial year 2008 was
in line with management expectations, with Group revenue for the third quarter
higher than the same period last year. The growth was mainly attributable to the
strong performance of our telecommunication (TEL) and electronic learning
products (ELP) businesses in Europe. The pick up in sales at our contract
manufacturing services (CMS) business also contributed to the overall revenue
growth.


For the nine months ended 31st December 2007, the Group revenue also increased
over the same period last year. Although rising labour costs and the
appreciation of the Renminbi continue to pressure all manufacturers in mainland
China, VTech continues successfully to mitigate these cost increases by
improving productivity, raising operational efficiency and achieving greater
economies of scale.


For the TEL business, revenue for the third quarter of the financial year 2008
was higher than the same period last year. Sales growth was driven by the
continued strong demand in Canada, Europe, Asia Pacific and other emerging
markets. In North America, as our DECT 6.0 and 5.8GHz cordless phones continued
to perform well, VTech maintained its leadership position in the US cordless
phone market despite a decline in sales year-on-year in the third quarter. For
the nine months ended 31st December 2007, the revenue of the TEL business
increased as compared to the same period last year.


In the third quarter of the financial year 2008, the ELP business achieved a
higher level of revenue as compared to the corresponding period of last year.
Sales in North America decreased slightly year-on-year in the third quarter
whereas sales in Europe increased. Traditional ELPs continued to demonstrate
growth and sales of the V.Smile range were in line with management expectations.
For the nine months ended 31st December 2007, the revenue of the ELP business
rose over the same period last year.


Revenue at the CMS business in the third quarter of the financial year 2008 was
higher than the same period last year. Growth was driven by higher sales to
existing customers. For the nine months ended 31st December 2007, the revenue of
the CMS business was comparable to the same period of last year.


The financial position of the Group remains very strong. As at 31st December
2007, the Group remained substantially debt-free. Stock and debtors also
continued at healthy levels.


"We are satisfied with the performance of the Group's businesses in the third
quarter and for the financial year so far. We are mindful of the economic
uncertainties caused by the credit problems that began in the US sub-prime
market. Looking at the most recent point of sales data and orders on hand,
however, we are cautiously optimistic that the Group performance will remain on
track to deliver modest revenue and profit growth for the full year, as we
indicated in our interim results in November 2007. With our strong balance
sheet, proven ability to control costs and well balanced product portfolio, we
have strong fundamentals that will support us even in the event of an economic
downturn," said Mr. Allan Wong, Chairman and Group CEO of VTech Holdings
Limited.


As at the date of this announcement, the Executive Directors of the Company are
Mr. Allan WONG Chi Yun (Chairman and Group Chief Executive Officer), Mr. Edwin
YING Lin Kwan and Mr. PANG King Fai. The Independent Non-executive Directors are
Mr. Raymond CH'IEN Kuo Fung, Mr. William FUNG Kwok Lun, Mr. Michael TIEN Puk Sun
and Mr. Patrick WANG Shui Chung.


For further information, please contact:


Ms Grace Pang

Senior Corporate Communications Manager

VTech Holdings Ltd

(852) 2680-1000 (office)

(852) 2680-1788 (Fax)

[e-mail] (email)




                      This information is provided by RNS
            The company news service from the London Stock Exchange
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