Belco Holdings Ltd yesterday announced net earnings for 2001 of $20.9 million, an increase of 2.3 percent over 2000, but warned that the company faces a challenging year in 2002.

"We are very pleased with the results achieved by the Belco Holdings Group in 2001," said president and CEO Garry Madeiros.

"The year was not without its challenges, especially during the fourth quarter of 2001 following the terrorist attacks of September 11. Throughout the year, we continued to work towards becoming a more productive and responsive organisation. We have begun the process of changing the way we do business by improving our work procedures, and generally achieving more with less.

"We expect another challenging year in 2002 and anticipate maintaining the level of results achieved in 2001. I thank all of our employees for their consistent hard work, determination and loyalty in achieving such positive results over the past year," said Mr. Madeiros.

Of the company's three main operating subsidiaries, both Bermuda Electric Light Company Limited (Belco) and Bermuda Gas & Utility Company Limited (Bermuda Gas) reported record earnings for 2001, while Belco Energy Services Company Limited (BESCO) performed well, but fell short of results achieved in 2000 according to a company release yesterday.

The company's largest operating subsdiary, Belco returned earnings of $19.8 million in 2001, an increase of 2.3 percent compared to 2000. Total electricity sales were up 3.5 percent as a result of increased consumption by both the residential and commercial sectors.

Bermuda Gas reported an increase in net income of 12.5 percent over 2000, with gas sales up 5.5 percent in 2001. The company said efforts to reduce expenses helped to offset shortfalls in appliance and service and parts sales during the year.

While BESCO's net income was down 19.6 percent from 2000, the company performed as expected according to company management. Operating revenue was up 20.6 percent as a result of a strategic move to grow the operational capabilities of the company through an exercise in staffing to meet the energy service sales opportunities that are expected in the near future.

Dividends per share increased ten percent during the fourth quarter of 2000, resulting in a cash dividend per share of $1.54 as compared to $1.43 in 2000. The company's share price ended 2001 at $27.75, up 18.5 percent from the $23 posted at the end of 2000. As of Good Friday, the company's shares were trading at $29.

Earnings per share increased to $4.55 from $4.46 in 2000.

The annual general meeting of Belco Holdings Ltd. will be held on Thursday, April 25 at 2 p.m. at Bermuda Electric Light Company headquarters, 27 Serpentine Road.