VTH Vtech Hldgs.

RNS Number:4855B
Vtech Holdings Limited
03 August 2007

                              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 first Interim Management Statement for the three months ended
30th June 2007 following its Annual General Meeting held on 3rd August 2007.


The Group revenue for the first quarter of the financial year 2008 was in line
with management expectations, with the performance of all three businesses on
track.


For the telecommunication products (TEL) business, revenue in the first quarter
was comparable to the same period last year. In Europe, sales picked up as the
market is recovering from excess inventory. In North America, VTech maintained
its leadership position in the US cordless phone market. Our new products,
especially the DECT 6.0 models, hit the shelves in April 2007 and have been well
received by consumers.


In the first quarter of the financial year 2008, the electronic learning
products (ELP) business achieved a similar level of revenue as compared to the
same period last year. Sales of the traditional ELP and V.Smile range were in
line with management expectations.


As existing customers mature and newer customers are only gradually building up
orders, revenue from the contract manufacturing services (CMS) business in the
first quarter was slightly lower than the corresponding period last year, as
anticipated by management. Despite this, we are still confident that the CMS
business will once again outperform the global EMS market in the financial year
2008, which is forecast to grow in the high single digits in the calendar 2007.


Overall, the Board is satisfied with the Group's progress to date but we remain
mindful of factors that could affect profitability. The Renminbi looks set to
appreciate further, as do the wage levels in mainland China. High raw material
and components prices continue to impose cost pressures on the Group. In
addition, China's new policy on processing trade, that will become effective
on 23rd August 2007, will further increase the Group's operating costs.


To mitigate these cost pressures, the Group will work hard to improve its
productivity and operational efficiency further, as well as to achieve greater
economies of scale.


For further information, please contact:


Ms Grace Pang

Senior Corporate Communications Manager

VTech Holdings Ltd

(852) 2680-1000 (office)

(852) 2680-1788 (Fax)

grace_pang@vtech.com (email)



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