"2001 was a year of significant progress in the company's efforts to improve it profitability. Our performance shows significant gains over the previous record year of 1999 when new levels were set for revenue, net income, and earnings per share. Whilst the fiscal year under review certainly offered its share of challenges, Bermuda Aviation Services Ltd. (BAS) not only remained profitable, but continued to maintain a position of minimal long or short term debt.
Revenue of $19.7 million was 15% above that of the previous year whilst net income was ahead 63% to a record $2.1 million. BAS stock valuation was relatively low during the year, closing at $6.50 at year-end. With earnings per share increased from $1.22 to $1.99, our shares represent a good investment for those holding them. In addition to the increase in revenue and earnings, operating profits were up 56% to $2.15 million. The results underscore the focus of our management as they correctly forecasted the declines in our core businesses and made the necessary adjustments to compensate. We are again fortunate that all divisions of the company continue to contribute to our success with the one exception being our bars and restaurant business at the airport. The bakery and retail divisions continue to attain our targeted revenue growth, and although bottom line results have not kept pace we are pleased with our gains in market share. We continue to invest in the infrastructure of the division and this year will complete the upgrading of all outlets to a standard that will meet the demands of our customer.
Our immediate challenge will be to maintain the same acceptable levels of profitability we have enjoyed for the past five years. With an economy that is softening, and an ever declining tourist base, our airport operations will continue to come under pressure. And whilst we welcome any initiatives that will improve our visitor numbers, we are painfully aware that growth if any, will be minimal. Contract negotiations with our airline clients although cordial, have been long and arduous as they face their own challenges and rightfully point out how expensive it is to operate in this jurisdiction. They demand we become more efficient, rather than look to them to compensate for what they perceive as jurisdictional
Challenges. BAS will continue to reset its financial goals, both top line and bottom line, to adjust for what will be a difficult industry for some years to come. Whilst the potential of lower revenues are worrying, we will compensate by applying the appropriate resources to the demands of the market. Contributions from non-core businesses and new initiatives will mitigate some of the expected declines.
Going forward, our strategy is to continue to use our cash flows to fuel expansion and acquisitions that will benefit the existing businesses. Having rationalised how we wish to position the company over the next few years, our focus will be on less labour intense projects, which will offer better opportunities for growth without significant expansion of capital. To this end we are investing in developing our back office and financial support systems. Continued diversification we believe, is our best opportunity for growth and increased profitability.
We enter 2002 with positive momentum. Our joint venture company BAS-Serco recently signed five year contracts to provide facilities management for the bank of N. T. Butterfield and Son Ltd., and with the Government of Bermuda to provide air operations and infrastructure support at the Bermuda International Airport. BAS-Serco now has the pole position on these services that are relatively new to Bermuda but widely used world-wide. These initiatives will not only expand our top line growth and diversify our growth profile, but also provide earnings stability through periods of uncertainty. We could not have accomplished this without a good partner, and in Serco we have the best. BAS-Serco's chairman Phil Edwards, Richard Savard and Malcolm Simpson, the company's chief operating officer and business development officer respectively, have shared this vision with our chief executive for some time. It is truly heart warming to see the results of their efforts bear fruit.
Our sustained successes are not the act of any one person in the organisation, instead they have been realised by the acts of many. So many people deserve thanks for their tireless efforts and support. In part we would like to personally express our deepest appreciation to our employees. They truly are the foundation of our success and deserve our heartfelt thanks for their commitment. The high level of service they provide has afforded us the ability to take advantage of many new opportunities. It is our goal to continue to provide nothing less than a productive and satisfying environment for them where opportunity is based on merit.
This year we will make management changes that will ensure our ability to meet the organisational needs going forward. Andrew Soares will move from finance and be re-appointed to the position of vice president and chief operating officer, the position he held when joining the company. Raymond Packwood who joined us in September of last year as financial controller is to be promoted to the position of vice president and chief financial officer. This new arrangement will enable each of them to devote their full attention to the areas that require it.
I wish to thank the members of our board for their unwavering service and support this past year and look forward to their contributions in the year to come. We will all miss the camaraderie and consul of our dear friend and fellow board member Francis "Goose" Gosling who passed away in February. His decades of exemplary service will be difficult to replace.
Finally I wish to say thanks to our management team as they continue to realise the potential of bas. Realising this potential has been hard work, requiring creativity, resilience and most of all willingness to change, which is not the customary mindset of a fifty-four old company. With their strength and vision we are better prepared to capitalise on emerging opportunities and weather any adversity."
The company also declared a dividend of 15 cents per share to shareholders of record august 3, 2001, representing a 7% increase in the quarterly dividend. The directors of the company were also pleased to declare a special dividend of 5 cents per share to all shareholders of record.