E. C. Ernst Inc., a Washington based electrical construction company, expects to report a loss of about $7 million in the six months ended Sept. 30, continuing a period of red-ink account book entries apparently related to questions about previous contracts.
Ernst Chairman Charles Soharfe Jr., who announced the preliminary figures yesterday, also said company management "is continuing to investigate possible irregularities in connection with certain prior period transactions." He offered no additional details.
Scharfe's company, which he has headed as chief executive since Aug. 20, has changed several key executives and expanded its board of directors since reporting a loss of $5.8 million in the fiscal year ended last March 31.
That loss, which had not been anticipated, resulted principally from a year-end audit. Ernst also has stopped paying dividends.
A part of the projected $7 million loss in the recent six months may be attributable to a prior period and additional losses may be listed, depending on a review and continung evaluation by current officers of certain joint ventures and domestic and foreign contracts, Scharfe stated.
Prior to Ernst's acquisition on June 1 of L. K. Comstock & Co. , another electrical contracting firm, Scharfe was Comstock's chief executive. He soon was named to succeed former Ernst Chairman Edward Johnson as chief executive.