VTech on the hunt for acquisitionsBusiness | Winnie Lee 19 May 2020
Electronic learning product maker VTech (0303) announced it is cutting its final dividend despite annual net profit growing by 11.3 percent to keep more cash in hand amid uncertainties brought about by the virus.
Its full-year net profit ended March grew 11.3 percent from a year ago to US$191 million (HK$1.49 billion), and declared a final dividend of 36 US cents. Its dividend payout ratio fell to 70 percent, and the annual dividend fell 21 percent to 53 US cents.
Revenue rose 0.2 percent from a year ago to US$2.17 billion. Revenue from its electronic learning products grew by 0.9 percent to US$920 million, driven by Asia Pacific and North America sales.
King Pang, group president at VTech, expects revenue of three major businesses to fall in the 2021 financial year as the pandemic has affected orders and demand for products.
The group plans to save cash with a negative view of its business. Chairman and chief executive Allan Wong said the group is still observing opportunities for cheap acquisitions after the pandemic abates, as it has adequate cash.