The Bermuda Bakery Ltd. ? which closed its commercial baking operations earlier this year ? yesterday reported a tenfold increase in its profits for the first six months of the year.

But the company would have taken a loss had it not received $1.3 million windfall from the sale of its shares in the Bank of Bermuda to HSBC Plc.

The company reported net income of $929,363 for the six months to June 30, a 1,042 percent increase on its profits of $81,504 in the same period in 2003.

But the firm, which also owns the Belvedere Building, would have reported a $385,823 loss had the sale of the bank not taken place.

The Bakery took on additional unspecified expenses for redundancy pay, disposal of assets and inventories in connection with the closure of the company?s bakery division.

The bakery division restructuring began in September, 2003, and concluded with the sale of some of its assets in early June 2004 and its subsequent closure.

Revenue for the period also fell 17.1 percent to $2.36 million from $2.85 million in the same period due to reduced sales of bakery products and the bakery division closure during the period.

The company said it expects revenue and profits to increase during the second half of 2004 due to the short-term rental of part of the bakery property and increased parking revenue.

The company is also ?evaluating its options? for the future utilisation of the Pitts Bay Road property, which it said was the largest undeveloped commercial property west of Hamilton.

The company said the Belvedere Building, and other holdings and investments of its real estate division, continue to perform well as a result of significant improvement in the control of costs and capital investments made to improve energy efficiency over the past two years.

Earnings per share were $3.24 for the period, an increase of $2.91 (1017 percent) compared to $0.29 per share in the first six months of 2003.