Jason Parquet warns of first half losses from higher costs and doubtful receivables

Jason Parquet Holdings has warned that it expects to record a net loss for the first six months.

This is mainly attributable to the following reasons:

* Lower gross profit due to higher cost of sales, as a result of increase in cost of materials and subcontract costs.

The increase in subcontract costs was mainly due to

a) an increase in the group's utilisation of subcontractors for the provision of installation services, as Jason experienced foreign labour shortages owing to government measures for companies to move away from reliance on low productivity foreign labour; and

b) an increase in the unit cost of these subcontractors; and

* Allowance for doubtful trade receivables from Poh Lian Construction, which was placed under judicial management on March 7, in respect of work done in the first quarter.

Further details will be disclosed when the Jason finalises its financial results on Aug 14.