HONG KONG – VTech Holdings Ltd. reported record revenue and profit for 2007. Revenue increased 21.5% over 2006 to $1.46 billion. Net profits rose 42% to $182.9 million.

The company’s EMS business grew by some 13.5% during 2006, primarily on higher demand from existing customers, especially switching mode power supplies, professional audio equipment and industrial printing.

A new plant at Qingyuan, Guangdong province, is beginning to make a positive impact, VTech believes. This quarter, a new EMS factory will open, increasing its capacity by some 50%. The company also intends to build a second factory at Qingyuan.

While Europe remained the leading source of EMS revenue, at 48.4%, the EMS group saw strong demand from North America customers, which pushed the region’s share to 7.1 points to 36.6%. Asia Pacific made up 15% of EMS revenues.

Switching mode power supplies and professional audio equipment continued to be the leading product categories, accounting for 28.2% and 27.7% of total EMS revenue respectively, followed by communications products and home appliances, the company reports.

Growth for the CMS business is expected to moderate, as existing customers mature and newer customers only gradually build up orders, but it should again outperform the EMS market, says VTech.

The Japanese market will be a focus for business development, with separate facilities and a new sales office.