Announcing its results for the six months ended 30th of September 2020. Since COVID-19 make attendance in person more difficult than usual, this presentation is being accompanied by a live webcast. Let me introduce the management team. From my left, Mr. King Pang, Executive Director and Group President. Mr. Allan Wong, Chairman and Group CEO of VTech Holdings. Mr. Andy Leung, Executive Director and CEO of Contract Manufacturing Services. And Ms. Shereen Tong, Group Chief Financial Officer. First of all, Ms. Tong will present the group financial performance. Next, Mr. Leung will review the group's operations. Then Mr. Pang will give the management outlook for the rest of the fiscal year.
We will finish our presentation with a Q&A session. During the Q&A, we will answer questions from those who are in the room with us first, before moving on to those submitted via the webcast. If you are joining us online, you can submit your questions anytime using the text box or the button on the screen. Now, may I invite Ms. Tong to open today's presentation. Ms. Tong, please.
Thank you, Grace. Good afternoon, ladies and gentlemen, and all viewers online. First of all, I would like to share with you the financial highlights of the group for the six months ended 30 of September 2020, compared with the same period of the last year. As you see from the slide, the revenue of the group was flat at $1,123.6 million . It was mainly due to the decrease in revenue in North America, Asia Pacific, and other regions, which offset the higher sales in Europe. The gross profit of the group rose by 3.5% to $357 million , and our gross profit margin also improved from 30.7% to 31.8%. The increase in gross profit and gross profit margin was mainly due to the lower material prices, while the direct labor cost and manufacturing overheads benefit from a weaker RMB.
Further productivity gains and a more favorable product mix also contribute to the improvement in gross profit and gross profit margin. Our operating profit rose by 5.5% to $142.6 million , and our operating profit margin also increased from 12% to 12.7%. The increase in operating profit and operating profit margin was mainly due to the improvement in gross profit and gross profit margin, as well as the decrease in total operating expenses. Our operating profit also include a fair value loss of $1.1 million on an investment in a company that designs and distribute integrated circuit products, as compared with a fair value gain of $8.5 million in the same period of the last year. Government subsidies of $4 million received from various countries in response to COVID-19 were also recorded in the first half of the current fiscal year.
Our profit attributable to shareholders rose by 4.7% to $123.6 million, and our net profit margin also improved from 10.5% to 11%. As a result, our basic earning per share rose by 4.5% to $0.49, and our board of directors has declared an interim dividend of $0.17, same as the last fiscal year. Turning to the revenue by region, North America remains the largest market of the group, accounting for 43.9% of the group's revenue. Our sales in North America reduced by 5.6% to $492.9 million. The decrease in revenue was mainly due to the lower sales of our Contract Manufacturing Services, which offset the higher sales of our electronic learning products and telecom products. Our sales to European market rose by 10.6% to $ 487.5 million.
It was mainly due to the higher sales of our electronic learning products and Contract Manufacturing Services, which offset the lower sales of our telecom product. In Asia Pacific region, the revenue of the group reduced by 8.2% to $113.2 million. The decrease in revenue was mainly due to the lower sales of our electronic learning products and Contract Manufacturing Services, which offset the higher sales of our telecom products. Other regions include Latin America, Middle East, and Africa. The group's revenue in other regions reduced by 34% to $13 million. The decrease in sales in other regions was mainly due to the lower sales of all our three product lines. Our stock balance as at 30 of September 2020 reduced from $457.3 million to $436.1 million compared with the same period of the last year.
Our stock turnover days also reduced from 141 days to 120 days. The lower stock level compared with the same period of the last year was mainly due to the group's tightened inventory management in response to the impact of the COVID-19. Our trade debtors balance as at 30 of September 2020 increased from $489.9 million to $521.7 million compared with the same period of the last year. Our trade debtors turnover days, however, improved from 62 days to 60 days.
The increase in trade debtors balance was mainly due to the increase in sales in the second quarter of the fiscal year compared with the same period of the last year. Our financial positions remain very strong. We were debt-free, and our net cash balance as at 30 September 2020 increased from $102.5 million to $137.1 million compared with the same period of last year. That is all of my presentation. I will now invite Mr. Andy Leung to share with you our operations review. Mr. Leung, please.
Thank you, Shereen. Good afternoon. I will now review our operations for the period. The COVID-19 pandemic has brought unprecedented challenges to most of the world business. When we announced our annual results for the fiscal year 2020 in May this year, key markets of the group were experiencing different level of lockdown, such as extensive closure of retail outlets, weak consumer sentiments, and a severe slowdown in business activities. This results in a very low order visibility and, consequently, we gave a pessimistic outlook for the fiscal year 2021. Despite many uncertainty, however, sales for the first six months turned out to be better than expected. The group reported stable revenue and improved gross profit margin and higher profit.
Looking first at the cost picture. The group profit margin in the first six months of the fiscal year 2021 was 31.8% as compared with 30.7% in the same period last year. The improvement was due to a number of factors. Material prices were lower. Direct labor costs and manufacturing overhead benefited from a weaker renminbi. Further productivity gains and a more favorable product mix also improved the group gross profit margin. Regarding the trade tensions between China and the U.S., on January 15, 2020, a phase one trade deal was signed between mainland China and the U.S. A 15% tariff that was imposed on VTech residential cordless phone was reduced to 7.5%, effective from February 14, 2020. To mitigate the impact, the group has started the production of residential phone at our new facility in Penang, Malaysia.
Some of our CMS customers have also been affected by the tariffs in the range of 7.5%-25%. Those who wanted to relocate their production outside mainland China have already moved to our facility in Muar in Malaysia. The group ELP are largely unaffected by the U.S. tariffs. Of course, the pandemic has brought unprecedented challenges to the group operations. Early in 2020, with many countries in different level of lockdown, global supply chains were severely disrupted and consumer demand weakened dramatically. In recent months, however, business operations have gradually returned to normal. Production and capacity utilization at our facility are now at pre-COVID-19 levels. Supply chain is operating as normal. Consumer demand have also recovered strongly in some markets. It has been especially robust for product relating to working and staying at home, which has benefited some of our products.
Globally, e-commerce has grown rapidly as consumer has switched more to online purchase. During the first six months of the fiscal year 2021, sales to e-tailer and other online channel expanded to 16.2% of the total group revenue. Restrictions on travel and meetings nonetheless means new pattern of working. We're much quicker reliant on carry out tasks and managing business remotely. VTech has been coping well with those challenges. Our global operation continues to run smoothly. As for liquidity, VTech is in a strong financial position, and we ended the half-year with increased net cash and lower inventory. While managing the effect of pandemic, our priority has been to protect the health and safety of our employees and customers. We continue to ensure a safe working environment at all our locations worldwide, according to the recommendations from the government and WHO.
VTech and our employees have also been giving much-needed support to the local communities, including financial donations and supporting children in need with educational toys. I will now look at our operation in details, beginning with North America. Group revenue in North America decreased by 5.6% to $492.9 million in the first six months of the fiscal year 2021, as higher sales of ELP and telecommunication products were offset by lower CMS sales. North America remained our largest market, accounting for 43.9% of the group revenue. ELP revenue in North America grew by 9.8% to $278.1 million, driven by higher sales of standalone products. The increase reflects the Group's strong position in electronic learning toys, a segment that have benefited from the pandemic as parent and children spend more time at home.
During the first nine months of the calendar year 2020, we strengthened our leadership as the number one manufacturer of electronic learning toys from infancy through toddler and preschool in the U.S. In Canada, we also maintained our position as the number one manufacturer in the infants, toddler, and preschool toys category. Growth in standalone products came from higher sales of both LeapFrog and VTech brand. LeapFrog sales were especially robust. Preschool items offering educational value, including Learning Friends 100 Words Book and 100 Animals Book, achieved strong sell-through. The Blue's Clues & You series licensed product performed strongly. However, sales of LeapBuilders declined. VTech standalone product benefited from rising sales of infants and toddler products, KidiZoom camera, other KidiLife products, and Go! Go! Smart family of products. These increases offset a decline in preschool products. There were innovative additions to the product lineup during the period. Go! Go!
Smart Wheels saw the additional Ultimate Construction Tower. Building on the success of popular robotic toys, Myla the Magical Unicorn, we launched Myla's Sparkling Friends, a line of toys that bring color play to life using fantastical characters. The Go! Go! Cory Carson Vehicle and playset hit the shelf during the period. The two seasons of the associated animation, along with a special edition entitled Go! Go! Cory Carson Summer Camp, are now streaming on Netflix. Sales of platform products in North America declined slightly. At LeapFrog, the platform product business posts overall growth. The growth in children's educational tablets and interactive reading system offset a decline in RockIt Twist. The growth was augmented by the introduction of Magic Adventures Globe. Subscription to the LeapFrog Academy continues to grow steady.
At VTech, sales of platform products saw a decline as higher sales of Touch and Learn Activity Desk were insufficient to compensate for lower sales of KidiZoom Smartwatch and KidiBuzz. Telecommunication product revenue in North America saw a 3.7% increase to $132.2 million, mainly driven by higher sales of residential phones. Sales of commercial phone and other telecommunication products held steady. During the period, sales of residential phones in North America rose as the trend of work from home led consumer to replace and upgrade their fixed-line telephones. The VTech brand's super long-range cordless telephone performed especially well. In the first half of the fiscal year 2021, we remained the exclusive supplier to a key retailer in the U.S. and strengthened our leadership position in the U.S. residential phone market. The commercial phones and other telecommunication products business in North America was stable.
SMB phones, hotel phones, VoIP phones, and conference phones posted sales decreases as they were hit by slump in business-related activity and in travel. However, headsets achieved higher sales, boosted by the trend of work from home. Baby monitors, the CareLine range, and IAD benefited from the stay at home advice as well. The new VTech 1080p 7-inches smart Wi-Fi baby monitor selling particularly well. As a result, VTech baby monitor strengthened their position as the number one brand in the U.S. and Canada. CMS revenue in North America fell by 40.9% to $84.6 million, with declines in all product category. The reduction in revenue was primarily due to the negative impact of the pandemic. The professional audio industries was significantly impacted by the restriction on public gatherings. A major customer experiencing excess inventory as a result.
A drop in replacement demand for coin and note recognition machine and over inventory at an industrial printer customer contributed to the sale decline in industrial products. Medical and health products saw lower order of hearing aids as sale activity were significantly affected by the pandemic. Sales of solid-state lighting fell as contract could not be concluded and project-based bidding ceased. Communication product recorded a sale decline as customer phase out their product range. The group nonetheless managed to add new customer in the field of professional audio equipment and industrial product during the period. Turning now to Europe. Group revenue in Europe increased by 10.6% to $487.5 million in the first six months of the fiscal year 2021. As higher sales of ELP and CMS offset lower revenue from telecommunication products. Europe remained VTech's second-largest market, accounting for 43.4% of the group revenue.
ELP revenue in Europe rose by 8.2% to $157.6 million, with higher sales of both standalone and platform products. Geographically, sale increased in France, the U.K., Germany, the Netherlands, while declining in Spain. In the first six nine months of the calendar year 2020, VTech was the number one infants and toddler manufacturer in France, the U.K., Germany, and the Benelux country. In standalone products, both the VTech and LeapFrog brand achieved higher sales. For the VTech brand, growth was led by preschool product, KidiZoom camera, other KidiLife product, and Switch & Go Dinos. This offset decline in infants product and the Toot-Toot Family products. The new Go! Go! Cory Carson Vehicle and Playset were rolled out to the major European market in September 2020 under the name of Toot-Toot Cory Carson.
LeapFrog saw rising sales of infants, toddler, and preschool product in the first half of the fiscal year. With strong sales of Learning Friends 100 Words Book and 100 Animals Book. This offset a decline for Bla Bla Blocks, which is the name in Europe for LeapBuilders. Platform products saw growth in the sales of both VTech and LeapFrog brand products. For VTech, the main drivers were KidiZoom Smartwatches, Touch and Learn Activity Desk, and children's educational tablets. Growth in this product offset a decline in KidiCom MAX. At LeapFrog, the revenue increase was driven by higher sales of Magic Adventures Globe, an interactive reading system, which offset decline in RockIt Twist and children's educational tablets. During the period, Speak & Learn Puppy and KidiZoom Video Studio HD were named the best infant toys and best high-tech toy in France.
Revenue from telecommunication products in Europe decreased by 8.4% to $52.5 million in the first six months of the fiscal year 2021, as sales of residential phone, commercial phone, and other telecommunication product declined. In Europe, the group sell residential phone to major telephone company in the region on an ODM basis. The pandemic resulted in reduction of order from this customer, as their business activities slowed down. For commercial phones and other telecommunication products, higher sales of CAT-iq headset, the CareLine, IAD, and headsets were insufficient to offset decline in baby monitor, VoIP phones, and conference phones. Stay-at-home advice across Europe benefited sales of CAT-iq handsets, CareLine products, IAD, and headsets as people are upgrading their communication devices. Baby monitors saw sales decrease as a major customer reduced orders.
Lockdowns and travel restriction led to the cancellation of trade shows and slowed down in business activities, resulting in a lower order for VoIP phones and conference phones. Sales of the group hotel phone in Europe held steady. CMS revenue in Europe rose by 16.8% to $277.4 million. Hearable medical and health products, home appliance, and communication product saw higher sales. This offset declines in professional audio equipment, IoT products, and switching mode power supplies. Hearable recorded significant growth as demand for headset was boosted by the need to work from home. A customer moving production of its new version of a true wireless headset to VTech also contributed to the sales increase. Medical and health product added a new customer during the period, and saw sales of hair removal product rise, offsetting a decline in order for hearing aids.
Business from home appliance was stable, while communication product benefited from increasing order for Wi-Fi routers. In contrast to these increases, professional audio equipment posted lower sales as higher demand on audio interface equipment failed to offset lower orders for audio mixers and amplifiers. IoT products also saw sales decrease as the pandemic significantly slowed down the installation of smart meter in the U.K. Sales of internet-connected thermostat and air conditioning control remained stable. Sales of switching mode power supply were lower, and the customer continues to transfer production back in-house following a change in ownership. Group revenue in Asia Pacific decreased by 8.2% to $130.2 million in the first six months of the fiscal year 2021, as lower sales of ELP and CMS offset higher sales of telecommunication products. The Asia Pacific region represented 11.6% of the group revenue.
Revenue from ELP in the Asia Pacific fell by 9.4% to $40.4 million. As growth in Australia was offset by lower sales in Mainland China. Australia saw a robust sales increase on strong sell-through of both VTech and Little Bear Brand products. In the first nine months of the calendar year 2020, VTech gained market share and has become the number one manufacturer in the infant toddler toys category in Australia. In Mainland China, growth in online sales was insufficient to compensate for the decline in offline channel. Revenue of telecommunication products in Asia Pacific increased by 15.3% to $15.8 million, due to higher sales in Australia, Japan, and Hong Kong. In Australia, growth was mainly driven by baby monitors, while Japan saw increased orders for residential phones from an existing customer. In Hong Kong, IAD was the key driver of higher sales.
CMS revenue in Asia Pacific decreased by 11.5% to $74 million, as lower sales of medical and health products and home appliances offset growth in professional audio equipment and communication products. The movement control order imposed by the Malaysian government in mid-March also affected sales, as this caused our CMS production facility there to shut down for several weeks. In medical and health products, sales of diagnostic ultrasonic systems were lower as hospitals relocated their budget to purchase COVID-19 related equipment. For home appliances, orders fell as products reached the end of life cycle, while orders for other products slowed down as a result of the pandemic. Contrasting with those decreases, the growth in professional audio equipment was driven by a rise in revenue from a new customer supplying USB streaming microphones for online KOLs.
Sales of communication products were also higher, with orders for marine radio increasing as the second generation of products was launched during the period. Finally, group revenue in other regions comprising Latin America, the Middle East, and Africa, fell by 34% to $13 million in the first six months of the fiscal year 2021. The decrease was attributable to lower sales of all three product lines. Other regions account for 1.1% of the group revenue. ELP revenue in other regions declined by 35.2% to $5.9 million for the period, as higher sales in Africa were offset by lower sales in the Middle East and Latin America. Telecommunication product revenue in other regions decreased by 27.4% to $6.9 million. The decline was attributable to sales decrease in Latin America and Africa, which offset an increase in Middle East.
CMS revenue in other regions was $0.2 million in the first six months of the fiscal year 2021, as compared to $1.1 million in the corresponding period of the prior fiscal year. That concludes our review operation. I will now hand over to King for the outlook.
Thank you, Andy. Good afternoon, ladies and gentlemen. The ongoing impact of the COVID-19 pandemic brings a high degree of uncertainty to assessing the outlook for the remainder of the financial year. The recent surge in infection rates in the U.S. and Europe, together with sustained high levels of unemployment, could weaken consumer sentiment in our key markets. Consequently, group revenue for the full year is not expected to grow. Gross margin, nevertheless, is forecast to improve year-on-year. Meanwhile, we are adapting our businesses to consumer shift towards online purchases. To capitalize on this trend, we are increasing our investments on online channels. Looking at our individual businesses. ELP's revenue is forecast to remain broadly stable for the full financial year. In North America, the positive momentum for both VTech and LeapFrog brands is forecast to continue, with the sales outlook for LeapFrog preschool toys especially promising.
In Europe, however, the nationwide lockdowns recently mandated, especially in France, Germany, and the U.K., may negatively impact holiday sales. In Asia Pacific, the trend in Australia is expected to remain robust. For mainland China, sales are expected to pick up in the second half, as shipment to our maternity infant child specialty channel and other brick-and-mortar channels are showing continuous improvements. For telecommunication products, revenue for the full year may decline slightly. Sales of residential phones are expected to hold steady, while the recovery in commercial phones is likely to remain slow. Paving our way for future growth, a new line of Voice over IP phones under the Snom brand will be rolled out in early 2021. For hotel phones, responses to our latest range, based on SIP and PSTN technologies, has been good.
This sets up VTech to benefit from the market consolidation that is underway, even though the challenges currently faced by the hospitality industry will dampen demand in the short term. The momentum in CAT-iq handsets, the CareLine range, and integrated access devices remain positive, while sales of baby monitors are expected to be stable. CMS revenue is expected to increase for the full fiscal year, led by strong orders for headsets and supported by recovery in other product categories.
Our new NPI center in Shenzhen will open up additional business streams. It aims to capture businesses from startup worldwide, especially those in mainland China's Greater Bay Area. State-of-the-art equipment is currently being installed. The center should be fully operational by the end of 2020. In Malaysia, with the phase I expansion of our CMS facility in Muar now complete, work is moving ahead on phase II. When it's completed, it will increase capacity by 50%. Thank you. This concludes our presentations. We now look forward to answering your questions.
Thank you, King. We will now begin the Q&A session. If you are now with us at the presentation, please raise your hand and we will pass the microphone to you.
Yeah. Hi, it's Leon, ROC Investments. Maybe you can give us a little color on the cost trends in the second half of your fiscal year. Key areas like wages, ICs, and other raw materials. Thanks.
Let me give you my outlook for the material costs. Material costs should still be trending down. As the cost of oil came down, we expect plastic prices should come down also. IC prices, after the first half, which we saw a somewhat reduction in the cost, we will see the second half will remain at a low level. We don't expect IC prices to increase except for a few items, which is affected by the Sino-US sanctions. Other material prices, we expect to be stable. Overall, I expect the material cost trend to be low to stable in the coming half year. Thank you.
Will those Sino-US sanctions cause any disruptions?
Yes. Allan, as we have said in our chairman statements, there's no new developments on the t rade sanctions. I think it is basically what we have seen when we are announcing the result for the last fiscal year. It is basically the same, with no additional tariffs being imposed. By and large, we are not affected, except one or two items in the telephone, and one item in the ELP area. Other than that, we are largely unaffected.
Congratulations to first half results. I find them very strong.
Thank you.
Where I am surprised, when you said you benefit in certain areas due to people staying at home. What surprised me is that the LeapFrog Academy, you said, had steady growth, so there was no acceleration of sales. Could you please comment on this? The second is t he increase of sales in Europe. How much is due to currencies, or what would be the sales increase in local currency terms? One more question regarding our second half. How about sell-in to retailers in Europe now and in the U.S.?
Okay.
To the cash position, I think the increase is also due to the cut in final dividend. What can we expect? Will you make good on the cut, the last final dividend in the coming one? Yes, my questions.
Okay. I will probably ask King to answer your first three questions. I will do your last question.
I will answer your first and third question. Then I will answer qualitatively your second question. I may have to pass it to Shereen to answer the part of the second question about exactly quantitatively, what is the increase in constant currency. Okay. LFA, we did see an acceleration in sign-up rate, as well as in being able to retain our users. Okay? So when we say steady, it really reflects the fact that LFA, at this point, still represent a reasonably small part of our overall toys business. So that is just how we word it. Second half sell-in. Right now, we are in the second week of November. We still have between four to five weeks of local shipment. Historically, this is the biggest five weeks for our entire year. We are still seeing pretty decent order book.
As of last week, unless Shereen hasn't told me, we haven't heard really big cancellations in order, so we're keeping our fingers crossed. European sales. The currency, mainly euros and sterling appreciation, especially for euros. The appreciation during the period really hasn't benefited us very much because of our currency hedging action that we took early in the year. Shereen, you have anything to add?
Yeah. That means in local currency, we also increase the revenue, especially for our electronic learning product business. As for telecom, in Europe, most of the sales are under ODM, and we also receive US dollar, and part of it is we receive euro. For CMS, actually, the increase in revenue is mainly due to the local currency increase. The local currency meaning US dollar, because for CMS or our customer, we receive US dollar, no matter we sell in Europe or in Asia-Pacific. So for ELP in Europe, in local currency, we also saw an increase in the first half. Even though we have hedged most of the currency in the first half of the fiscal year, we can't enjoy all the benefits regarding the recent appreciation of the euro and pounds, but we still get some benefit. But it's not as significant as what the market and trend.
The question on cash position.
Okay. Your fourth questions. Last year, we did reduce our dividend payout ratio from over 90% to about 70%, which is still a decent payout ratio. Due to, at the time in May, where most of the countries are undergoing a lockdown, and we really, at that time, don't know what the business outlook looks like. So we are very cautious at the time that we should be retaining more cash in the company. Today, I have to say, I feel better today. However, we are not completely out of the woods yet. As Andy has presented, Europe is undergoing a new round of lockdown. So is the U.S., where the COVID-19 confirmed cases is at an all-time high. Plus, unemployment figures are increasing. So although I feel better today, I'm still cautious.
Not only because the new round of pandemic lockdown, but also the aftermath of the pandemic that give rises to unemployment and hence the economic slowdown in our major markets. So, at this point in time, all I can say is we are not completely over yet. Now, it's our policy that we do not retain more cash than necessary in the company. So in the event that we feel that we don't need the extra dividend that has been retained because of the reduction in dividend payout ratio last year, at some point, we will return it to shareholders. Thank you.
Okay. I will now move on to the online questions. The first two question is from Timothy at CLSA. His first question is, could you please give us the revenue growth in first and second quarter, respectively, and also by segment? His second question is-
Shereen.
any brought over revenue recognized in first half, as we record flat revenue growth in first half, but management estimate full year revenue not to grow.
Okay. I will let Shereen answer the first two questions. I will perhaps supplement on the second questions after Shereen has given her answers.
Normally, we will not present our quarterly result. But for this fiscal year, especially for the first time, it's pretty abnormal, because in the first quarter, we saw a double-digit decline versus last year. But in the second quarter, all our ELP allies picking up. Then you are talking about segment. We are talking about the by region segment. We can also see that for North America and Europe, they are also picking up. That's why when we gave the outlook in our result announcement in May, we don't foresee that we will have a turnaround in the first half of the financial year. But at the end, the result is better than we expect. It's mainly because the second quarter of this financial year was pretty good and beyond our expectation.
For the second questions regarding why our first half actual result was flat and why our full year revenue, why now we don't expect it will grow. It's mainly because as King has presented in the outlook area. We still have some uncertainties regarding what the COVID-19 impact will affect the retailers business, especially when we are approaching the holiday seasons like Thanksgiving and Christmas.
Regarding sell-in, still okay, but we don't know what would the actual POS result, especially when there's some lockdown order in Europe. Then we can also see day by day that the pandemic cases in our major countries like Europe, U.S., they are also climbing up. That's why we prefer to be conservative in our estimations of the full year revenue, especially in the second half of the financial year, which is the big piece of our whole year business. Mr. Wong, you want to add anything?
I will supplement perhaps some of the second part of the second questions. You remember the first half last year, last fiscal year, we do have brought forward some revenue because of the fear for the Sino-US trade war. This year, we haven't. It's still quite remarkable that when we compare with the same period last year, the first half, and yet we have flat. This is beyond our expectation. We thought the market responded fairly well.
Shereen has also said that, and also in my chairman's statement, we are still concerned about outlook, as I said earlier. I like to say that we can still maintain the growth for the full year. But we prefer to be more conservative at this point in time. I think it's fair to say that we shouldn't expect any growth at this point, if you ask me. If next May, if we are sitting here, if the vaccines are out, if the pandemic has been controlled, then I may have a more optimistic outlook for you. But at this point in time, this is the best outlook I can give you.
Okay. The next online question is from Se Chai from Oakland. Regarding the ELP sales in China, what is your strategy there, given that the competition seems to be extremely strong? What is your target market position in China in the next three years?
I will have King answer this question.
Well, I answer the last question first. In any market, we want to be a leader. That should not be any change in China compared to other markets. What is our strategy? Any strategy in VTech starts with products. We will continue to bring out good and valuable products. Then it really comes down to sales and marketing. In the first half of this fiscal year, we encountered some setback, especially in our, whatever that fancy term is. It is essentially the nursery market, where our shipment did not flow as smoothly as we did last year. We also had, especially during the first two, three months, difficulties with our brick-and-mortars market.
As we reported, while we have sales increases in our online stores, they were not sufficient to compensate for it. Most of these problems that we encountered in the brick-and-mortar channels are by and large resolved. So we do expect our business in China to pick up, and I would like to re-emphasize that our target in the coming years remains being a leader in China.
Thank you, King. Due to time constraint, we will answer one more online question. This is from Eric of Citi. First of all, his question is: How come the management still anticipate full year FY 2021 revenue to decline given the positive growth in first half FY 2021, and the current economic resumption in the U.S. and Europe. Is there any change of competitive landscape like losing share in telecom, ELP and CMS? His second question is: In the first half of the fiscal year 2021, both U.S. and Europe are hit by COVID-19 at the same time. But why CMS in the U.S. down while EU up? Yes.
I will answer your first question, and then I will have Andy answer your second question. In fact, the first question, we have answered before. I would just like to clarify that there is no change in competitive landscape in telecom, ELP, and CMS. Our conservative outlook are purely on the pandemic. Having the second wave in Europe and also in the U.S., that will to some extent affect the coming Christmas sales. Also, we are concerned about the economic outlook in the presence of the more serious pandemic outbreak. That is why we are giving a more conservative outlook for the year, despite we have a fairly positive first half result. For the second question, I will pass it to Andy.
Hi.
to answer about CMS.
Yeah, that is true that both U.S. and Europe were hit by COVID-19 in the same period. The difference in performance between U.S. and Europe were mainly driven by the type of product. In U.S., the revenue decline was mainly due to the impact of the COVID-19 to the professional audio equipment and also the industrial product. The professional audio equipment are mainly with the application in the public gathering. Some event like for the church, live concert, and also the lecture theaters.
Because of the restriction in public gathering, the revenue from this product area were very much affected. For the case of Europe, the major growth in Europe was in fact driven by our wireless headset, and this is a benefit from the requirement of work from home. I was told by the customer that most of their customer, they purchase headset and distribute it to their employees so that they can work more effectively at home. These are the reason.
Thank you, Andy. This concludes our today's presentation. Thank you very much for joining us.