Gzitic Hualing Holdings is expected to see a significant improvement in its bottom line this year; after its net loss in 1997 widened to $175 million from $78.43 million previously. Chairman Xu Zhi yesterday promised a strong recovery in sales of its core home electrical appliance products this year, but fell short of projecting a turnaround. 'We are confident we will greatly reduce losses this year, after putting in place various attempts to cut costs and boost sales,' Mr Xu said. First-quarter sales had been satisfactory, he said, with the company holding product prices. About 60,700 refrigerators have been sold in the first quarter, up 127 per cent from a year earlier. Mr Xu said the figure compared favourably with last year's full-year sales of 80,000. Air-conditioner sales, at 29,800 units, grew 30 per cent during the first quarter. Mr Xu was tight-lipped on asset-injection plans after buying part of a Guangzhou office tower last month from majority shareholder Guangzhou International Trust & Investment Corp. The parent reshuffled Hualing's management last December to bolster the loss-making firm's performance and allow it to diversify into other businesses. Hualing made a doubtful-debt provision of $30 million last year for account receivables worth $150 million and stockpiles amounting to about $500 million, financial controller Roger Law said. The company said it had been trying to sell stockpiles in a mainland market where demand was half of supply. Last year, mainland demand for refrigerators was 10 million, but supply was 20 million. Mr Law said the company had turned to mainland banks for loans, taking advantage of the lower interest burdens in the mainland. About 90 per cent of its loans were from mainland banks. The parent, a Guangzhou-based non-bank financial institution, has helped the company seek yuan loans.