Tee Int’l

Tee Int’l: 3QFY12 revenue fell 60% yoy to $25.4m, though net profit jumped 146% yoy to $1.8m.
The lower revenue was due to the lumpy nature of Tee’s engineering work; the co rushed a couple of its bigger projects to completion in FY11 resulting in last yr’s bumper yr.
The higher net profit was partly attributed to one-off gains of $0.5m, vs one-off losses of $0.2m yoy.

OCBC notes, with a chunk of FY12 revenue brought forward to 4QFY11, Tee’s ytd financial performance has been disappointing; and although Tee remains confident of its outlook (engineering order book +$37.6m to $245m at end 3QFY12), the house believes Tee is unlikely to meet FY12 consensus estimates.
OCBC lowers FY12E revenue and net profit estimates by 22% and 41% rptvly. Downgrades Tee to Hold with reduced TP of $0.28 (from $0.36).

Adds the recent CAD investigations on non-executive chairman Mr Bertie Cheng and Group CEO Mr CK Phua will likely cause some downward pressure to Tee’s share px in the near term.