Tee International tells bourse it is able to fulfil borrowing obligations

Published Tue, Jan 19, 2021 · 06:20 PM

WHILE mainboard-listed Tee International returned to the black in the second quarter, the Singapore Exchange raised queries as to whether the group will be able to fulfil its obligations on S$44 million in loans, given that repayments on them fall due in a year or less.

In a bourse filing on Tuesday, Tee International said that it will be able to meet its debt obligations as and when they fall due. The firm's cash balance stood at S$21.2 million as at Nov 30, 2020.

The group elaborated that the S$39.7 million in secured borrowings are related to financing the group's ongoing engineering projects. This will eventually be repayable from the cash generated through trade receivables of S$29.6 million and contract assets of S$128 million.

In addition, the S$4.3 million in unsecured borrowings are general financing lines used mainly for general working capital, said Tee International.

Despite the lower revenue, Tee International swung into profitability for the half year ended Nov 30, 2020, recording a profit after tax of S$1.8 million from a loss after tax of S$41.1 million a year ago.

This was the result of several cost-cutting initiatives and lower administrative expenses and finance costs following the repayment of borrowings and notes payable in the prior year, it said.