Tech and learning toy specialist VTech Holdings has seen its group revenue for 2016 decrease by 1.2 per cent to $1,856.5 million.
In the results for the financial year ended March 31st 2016, the firm has reported lower revenue and profit, citing ‘unfavourable currency movements’ and a ‘change in product mix’ as the leading cause.
The firm took a big hit late last year when it fell victim to a cyber attack on its Learning Lodge app store, an occurrence that resulted in costly administrative and operating expenses.
“VTech experienced a challenging environment in the financial year 2016, resulting in a decrease in revenue and profitability,” said Allan Wong, chairman and group CEO of VTech Holdings Limited.
“The strong US dollar depressed the Group’s reported revenue, while the weak economy in Europe affected sales in that region. In addition, the data breach due to the cyber attack on VTech’s Learning Lodge in November 2015 added to the decline in sales and profitability.
“In April 2016 the Group completed the acquisition of LeapFrog Enterprises, a leading developer of educational entertainment for children, paving the way for future growth in electronic learning products.”
November 2015 saw VTech victim of a cyber attack in which personal information from users of the Learning Lodge, the Planet VTech website and KidConnect service was obtained.
The firm took steps to suspend all affected websites and services, resulting in the Learning Lodge being offline during the key holiday period.
In Europe, core infant products saw a decrease in sales including core infant, toddler and pre-school learning products as well as Switch n Go Dinos. The drop in sales saw ELPs revenue in the region drop by 10.2 per cent to $325.5 million.