Revenue for VTech in Europe declines in 2010

VTech sells its TEL products to customers in Europe mainly on an Original Design Manufacturing basis. Sales of these TEL products fell by 11.5% to US$171.4 million in the financial year 2010. There was a rebound in the second half as customers began to restock following severe draw downs in inventory, but this was unable to offset the sales decline in the first half. ELP sales to Europe decreased by 6.5% to US$241.7 million in the financial year 2010. As in North America, declining consumer demand and lower average selling prices depressed sales for the full financial year. Standalone products again fared better than platform products. In spite of the overall sales decline in this region, ELP sales in the UK and Germany were relatively stable. During the financial year 2010, the Kidizoom and Kidizoom Pro cameras were the top selling toys in Germany and the UK. Despite a strong pick up in the second half, CMS revenue in Europe declined slightly by 2.0% to US$115.8 million for the full financial year. Demand for switching mode power supplies and wireless products was impacted by the economic contraction in the region. However, we continued to see gains in professional audio equipment as existing customers increased orders.