Tee Intl

Tee International, a regional player in the Engineering, Infrastructure and Real Estate space, reported a 23.3% growth in its 2Q FY15 net profit to SGD 2.6m. For the half year, net profit rebounded 47% to SGD4.7m. This was on the back of gross margin expansion from 10.1% in 1HFY14 to 13.1% in 1HFY15 as more higher-margin projects were recognised. Its property arm, Tee Land, also contributed positively as more profits were booked in from its real estate JV projects. Tee International is also proposing an interim cash dividend of 0.18 cent per share, as well as a distribution in specie of Tee Land shares to shareholders on the basis of 1 Tee Land share for every 15 Tee International shares held by entitled shareholders. Based on the last traded price of Tee Land, the distribution amounts to another 1.9cents per share. The total dividend amounts to a yield of 7.3% on Tee International's last traded price and in our view, reflects management's confidence in its outlook as it executes on a robust orderbook of SGD415m.