dsept Nov 2012 2016 INNOVATION BEYOND TECHNOLOGY 1
About the VTech Group Locations Headquartered in HKG since 1976 Listed in HKG (HKSE:303) Factories in HouJie, LiaoBu & QingYuan, R&D Center in SZ Operations in 11 countries and regions Employees 27,400 Employees Worldwide 1,500 R&D Professionals & Engineers Financials Financially Strong & Reputation for High Quality 3 Divisions : Phones, Electronic Learning Products & CMS $1,856.5M Revenue in FY2016 and $982.9M for 1HFY2017 2
FY16 Group Financial Performance Group Financial Highlights Group Turnover in the Past 5 Years, US$M US$M FY14 FY15 FY16 FY16(1H) FY17(1H) Sales 1,899 1,879 1,857 928 983 Operating Profit 227 220 202 111 79 Profit Before Tax 228 222 203 112 80 R&D Expenses 58 56 56 29 39 Cash on Hand 323 294 273 105 104 No. of Employee 30,900 29,500 27,400 29074 28,000 FY16 Sales Distribution by Geography Sales by Companies, US$M US$M FY14 FY15 FY16 FY16 (1H) FY17 (1H) Phone 627 652 585 315 278 ELP 779 703 692 307 366 CMS 493 525 579 306 339 3
CMS Annual Sales Trend and Projection Sales (USD M) 4 th 3-Y Plan Actual Projection 1 st 3-Y Plan 2 nd 3-Y Plan 390 421 3 rd 3-Y Plan 460 493 525 579 650 233 248 261 281 93 95 97 128 158 FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 26 th among the world s top 50 EMS providers in MMI 14 th consecutive year of sales growth 4
LED 4% Home Appliance 5% Industrial 8% Communications 6% Medical 5% Automotive 1% 579.2 million FY16 CMS Sales Distribution North America $192.5 million (33.2%) Pro Audio 36% Europe $334.0 million (57.7%) Asia Pacific $52.7 million (9.1%) Power Supplies 15% Hearable 20% FY16 Major New Product Line Up Ultra Low Noise 96kHz Digital Mixer In-ear Wireless Smart Headphones Vehicle Battery Charger Calibrated LED Lighting Smart Meter Display Coffee Maker Pro Audio Hearable Power Supplies LED Home Appliances 5
Business Strategy of CMS CEO Business Support Units SBU1 SBU2 SBU3 SBU6 SBU8 The Strategy Growth by Organic with Selective Acquisition China Plus One Customers Focus Business Mission Be the preferred business partner of selected customer segment in the EMS Industry Core Competence & Competitive Edge Core Competence Stable middle to senior level staffs with good knowledge in EMS business with skill in serving our customer well. Competitive Edges Niche in manufacturing professional audio products, strong financial backup by the Group and right size to serve selected customers segment. 6
CMS Manufacturing Capabilities CMS 5 buildings with over 85K Sq. M. Manufacturing Area SMT, Thru-Hole, RoHS, REACH, ISO9001, ISO14001, ISO13485, TS16949, ISO18001, SA8000 ANSI ESD S20.20 for all production floors Manufacturing Capabilities 24 Fuji SMT Lines, State-of-the-Art Equipment In-housed design and fabrication for ICT, AOI, ATE, FAT Chip on Board in Class 1,000 Clean Room Class 10,000 Clean Room for precise products Burn-in Chambers, X-Ray Inspection, Conformal Coating Reliability life tests e.g. drop test, high/low temp cycle Plastics in VTech In-House Manufacturing and Tooling for plastics 2 Plastic Factories in HouJie and QingYuan 2 Automatic Spraying Lines in QingYuan factory 400 Plastic Injection Molding Stations, Up to 850 Tons Over-Molding Technologies 7
VTech Metal Capability (Acquisition of Kenny Products) Kenny Products: Established in 1979 with 600 Employees, 25,000 Sq. Meter Factory area One Stop Service: Tooling Design & Making, Stamping, NC-Punching & Bending, Secondary Process and Surface Treatment Stamping Facility: 90 sets Press Machines, up to 650 Tons 40 sets Stamping Robotic arms Stamp Types: Robotic Stamping Lines, Progressive, Single-Stamping, Transfer and Hydraulic. NC Facility: 4 sets NC-Punching Machines 4 sets NC-Bending Machines Satisfy High-Mix Low-Volume Orders 8 Secondary Process Welding Facility: Assembly services catering to functional or appearance related requirement Laser Welding, Stud Welding, Robotic Arc Welding Machines
VTech Metal Capability (Acquisition of Kenny Products) Surface Treatment Facility: Automatic wet painting line & powder coating line in Class 100K Silkscreen printing and pad printing workshop Facilities fulfill environmental regulations Quality Management Systems & Quality Control: Accredited with ISO9001:2008 and ISO/TS16949 Certificates by BSI CMM RoHS Tester Hardness Tester Salt-Spray Tester 3D Vision Projector Fisherscope X-ray System Products Categories: Professional Audio Equipment, Home Appliance, Computing Electronics, Office Automation, Power Supply Units and Automotive Products. 9
Quality Management System Quality & Environment System ISO18001 ISO9001 ISO14001 ISO13485 ANSI/ESD S20.20 TS16949 SA8000 System and Process audit Customer VTech Tracking System Identification & Traceability Material Product barcode barcode system system Equipment Control Statistical Techniques Customer 10 Customer request & PO review Material planning (ERP in SAP)& PO release Vendor Rating System & Improvement Program Vendors Material received IQC Manufacturing Process control In-process Quality Control Production Outgoing Quality Assurance Inspection & Test Outgoing Quality Assurance Storage, Packaging & Delivery
Protecting Our Client s Patents and IP Our Procedures to protect IP NDA or General Confidentiality Agreement Tightly Controlled Documentation and Copying of Doc s Access on an As needed Basis Continuous Training of our Employees Return of all files after the completion of a Project The Result Our Customers and potential Clients are fully protected Our four Buildings as Technology Protection in Projects History and Forward Looking No History of any IP Violation since our Existence Ongoing IP & Patent Awareness Training 11
Sustainability Our sustainability vision is to design, manufacture and supply innovative and high quality products in a manner that minimizes any impact on the environment, while creating sustainable value for our stakeholders and the communities. 1) Product Responsibility & Innovation 2) Environmental Protection 3) Workplace Quality 4) Sustainable Operating Practices 5) Community Investment 12
R&D Engineering and Design Support R&D Design Services Include Product Design, ID Support, Cost-Down Re-design Electronics including Hardware & Software Design Mechanical, Structural & Assembly Design Schematic and PCB Layout Design Packaging Design (Gift Box, Clamshell, Export Carton, etc) Typical Applications and Competence HW & SW developments for MCU, MPU, DSP, etc. Drivers and Embedded System Applications RF, Wireless, Audio, Consumer Electronics, Medical, Health Care, Telecomm, LED Lighting, Prototype, Testing and Agency Approval New Product Introduction - NPI Design for Manufacturability (DFM) Sample Production and Design Verification & Validation Selection of Low Cost Components Resources 13 Located in Nanshan, Shenzhen Professional Audio Test Lab CAD & Simulation Software e.g. ProE, Solidworks, FloEFD 40 Engineers & Technicians support design professionally
Audio Test Laboratory Listening Room Accreditation South China National Centre of Metrology Features Test Frequency 125Hz-8KHz Background noise 28dB or below Sound isolation 55dB in average Parametric, Functional & Listening testing ITU-R BS.11161-1 standard Acoustic Room Accreditation South China National Centre of Metrology Features Test Frequency 200Hz-20KHz Background noise 28dB or below Sound isolation 55dB in average Parametric testing ISO3745-2003 standard 14 VTech R&D Center Audio Test Laboratory with its state-of-art equipments allows audio product testing to be carried out in house with a shorter turnaround time
Thank You! 15