Renovations at Kentucky Fried Chicken last year helped boost sales and earnings for KFC (Bermuda), according to its chairman?s report released to the Bermuda Stock Exchange (BSX) yesterday.

The company closed its Queen Street store for two weeks last May to carry out a $338,287 refurbishment of its dining room.

?The increase in the use of these facilities has certainly helped raise the level of sales and earnings,? chairman Donald P. Lines said. Net income for the year ended January 31 was $489,961 compared with $256,880 during the corresponding period a year ago. Sales rose $468,084 over the previous year.

The chairman said in his report that modest price increases on certain food items and control over the cost of the menu items saw gross profit increase by $396,474 over the previous year.

Operating expenses for the year end January 31 increased by $156,332 over the previous year. Mr. Lines said this was largely due to a $108,266 increase in salary and wage costs to $1,481,245.

Franchise fees also increased by $27,361 over the previous year due to the increase in sales. Repairs and maintenance amounted to $115,834 compared to $102,229 in the previous year.

Cash resources amounted to $1,266,521 compared with $1,003,415 at the previous year. Total liabilities amounted to $292,353 compared with $239,422 a year earlier.

?We look forward to the 2006 fiscal year with optimism and hope that the steps we are taking to improve our facilities will continue to generate increased sales and profits in the future,? Mr. Lines said. Shareholders? equity at the end of January 31 amounted to $2,136,394, or $3.58 per share, compared with shareholders? equity of $1,771,910, or $2.96 per share, in the previous year.

KFC Bermuda bought 1,800 of its own shares at a price of $3.58 during the year and yesterday announced that it will continue to repurchase its own stock from time to time in order to reduce shares outstanding to a ?more acceptable level?.