Tuesday, January 8, 2002

Schools’ revenues
top $1 billion

Trust income reaches the
mark for the first time during a
period of economic recession

Goldman stake sold

By Rick Daysog

Despite the recent turmoil in the nation's financial markets, Kamehameha Schools said its revenues for its 2001 fiscal year topped the $1 billion mark for the first time in its 117-year history.

In a 68-page annual report released yesterday, the $6 billion charitable trust said its revenues, federal grants and other forms of financial support increased 8.1 percent during its year ending June 30, 2001, to $1.012 billion.

That compares with the previous record of $936.3 million during its fiscal year 2000.

Although the results do not include the financial effect of the Sept. 11 economic downturn, they reflect a period in which the national economy went into recession and the U.S. financial markets headed south with the downturn of the high-tech sector.

"Today, top to bottom, we are an institution transformed in focus, structure and ways of doing business," said Hamilton McCubbin, the estate's chief executive officer. "Today our strategic focus has shifted, bearing witness to the extent of Kamehameha's push to serve more and more Hawaiian students."

The trust, founded in 1884 by the will of Princess Bernice Pauahi Bishop to educate native Hawaiian children, said it spent a total of $206 million during its last fiscal year on educational programs.

That represents a 54 percent increase from the $133 million it spent on educational programs in 2000.

Enrollment in the estate's preschool through 12th-grade programs rose by 117 students to 4,474 last year.

Summer programs, which include its Kapalama Heights campus programs as well as those in partnership with the state Department of Education, increased by 1,997 students to 7,928.

Over the longer term, the estate has announced plans to extend its early childhood programs to reach about 10,000 students, or about a third of the native Hawaiian children of preschool age. It also wants to expand its vocational training programs to reach 4,200 post-high school students.

On the financial front, the estate continued to reap benefits from its investment in Goldman Sachs Inc.

The trust, Hawaii's largest private landowner, said it sold about 16.5 million shares in Goldman Sachs last year at a price ranging between $90 and $109 per share. Yesterday Kamehameha Schools sold its remaining 5 million shares in Goldman Sachs.

Overall, the estate said its net realized and unrealized gains on its investments from Wall Street and in the nation's real estate markets increased to $654 million last year, from fiscal year 2000's $651.6 million.

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