"Consolidated results for the year 2001 for the Bermuda Bakery Ltd. and its subsidiary reflect a significant improvement in Net Income over year 2000. The 62.1% increase to $553,678 is mainly the result of meeting budgeted cost reductions and improved efficiency in all areas of the Rental and Bakery operations.
Earnings per share rose correspondingly to $1.94 from $1.20 in the previous year.
Net Capital assets increased by $394,217 reflecting the modernization of bakery equipment and renovation to the original bakery office building.
Our Belvedere office tower continues at full occupancy with excellent long-term tenants who have invested substantially in improvements to their offices and make the Belvedere one of the prime office locations in the city. The bakery's concurrent investment in infrastructure upgrades has yielded substantial improvements in operating costs.
The Bakery division was able to hold its share of the retail bread and snack products market despite a traumatic and weak local economy which saw bakery product sales remain relatively flat, year over year. It was the year for laying the foundation for restructuring the Bakery Operations to meet the challenges of the years ahead.
A recent consumer market research report confirmed the leadership position enjoyed by our Roman Meal and Sunbeam brands as well as the strong support for our new Buttercrust labelled breads and snacks. Marketing will continue to build on this preference and support shown by Bermuda consumers.
The past year marks the first full year of operation of the hand-held computer sales route management and invoicing system. This modern technology has proven invaluable in instant and accurate customer invoicing, detailed data management as well as analysis of customer buying patterns with real-time capabilities.
One of the Bakery's strengths is the pride and dedication of its Bermudian workers as typified by the retirement of four long serving employees who represented over 177 years of service. Their departure has challenged management to re-structure its systems and with the support of all staff, balance the workload without additional hires. This reduction in workforce will result in substantial cost savings in the future.
The establishment of the Finance Committee and its review and direction of the budget process has proven to be highly effective. This close working relationship between management and the Board has resulted in a new direction for the bakery management team as well as the development of strategic initiatives that will guide Bermuda Bakery Ltd. into the future.
I am pleased to report that all capital expenditures and expenses have been funded from current earnings and the Bakery continues to operate without debt. Dividends paid last year amounted to $251,012 or $0.88 per share as in previous years. Trading in Bermuda Bakery shares on the Bermuda Stock exchange was modest and in the range of $22.00 to $23.50
As we begin our 80th year of operation the challenge is to retain those strengths and characteristics which have sustained us over the years while changing to meet the needs of our clients and the community we serve. I wish to thank the Directors, management and staff for their dedication and support and congratulate all on the excellent results on behalf of our shareholders."
Signed,
James A. Pearman
Chairman and President
Bermuda Bakery Ltd.