Belco Holdings Limited, the parent company of the Bermuda Electric Light Company and Bermuda Gas, declared one for ten stock dividend on Tuesday.

In a letter sent to shareholders on Tuesday, the company's chief executive, Garry Madeiros, said the performance of the company's subsidiaries was projected to be "very good" and justified the stock dividend. The company also paid a cash dividend of 38.5 cents per share for the fourth quarter of 2002, which the board intends to continue paying "for the foreseeable future".

The company hopes that the additional shares will satisfy demand for Belcock, which it believes has been greater than what the market was able to provide because the majority of shareholders are long-term investors.

"However, the receipt of bonus shares might encourage trading of these shares," Mr. Madeiros said. Indeed, Belco shares have not traded on the Bermuda Stock Exchange since December 19, when they were sold for $30.50 apiece.

Mr. Madeiros said Belco was in a strong financial position at the end of 2002. During the year, the company managed to sell its stake in two telecommunications companies, Quantum and Fibre.com. Fibre.com owns the underground fibre optic network in Hamilton that was to be used by Quantum.

Performance of Belco's operating units was also in line with expectations.

The amount of electricity sold was 3.3 percent higher during the first eleven months of this year than during the same period last year, which the company attributed to warmer than usual temperatures in the autumn, which increased the use of air conditioning. While demand for electricity usually peaks in August or September, this year the peak was not recorded until October 3. However, operating efficiency was slightly below 2001 levels during the 11-month period and for every barrel of fuel, Belco generated fractionally less power than last year. The company attributed the difference to this year's engine overhauls. The warmer weather that helped performance at Belco hurt its sister company, Bermuda Gas: demand for propane gas was also lower, at 1.7 percent below last year.

The declines in propane sales to the commercial and residential sectors were offset somewhat by increased sales of small propane cylinders, which are increasingly being used to power fork lifts intended for internal use because propane is a cleaner fuel. Appliance sales also increased due to an expansion in the range of appliances sold. Ironically, training initiatives hurt profits at the company because employees ran up less chargeable time on customer jobs. In the letter, Mr. Madeiros explained the flatter organisational structure it will adopt this year to improve efficiency. The traditional organisation chart, based on departments, will be replaced by a structure focused on "strategic team-based processes."

"The changes taking place in January are a major step forward," Mr. Madeiros said. "This is a defining time for Belco."

It also seems Belco will have little trouble filling some of the positions within that structure. In November, 240 people showed up for an information session about an apprenticeship programme that will be filled with nine people.