Barnwell Industries Inc.'s profits soared nearly 700 percent in its fiscal fourth quarter as the oil and natural gas producer ended its fiscal year with its best full-year operating results ever.

The Honolulu-based company posted net income of $3.2 million, or 38 cents a share, in the fiscal quarter ended Sept. 30 compared with $401,000, or 5 cents a share, a year ago.

Revenue rose 36.9 percent to $15.3 million from $11.2 million.

Morton Kinzler, chairman and chief executive of Barnwell, said yesterday that the fiscal-year earnings were the second best in the company's 52-year history but that the 2006 earnings - Barnwell's best ever - included $4.13 million in net earnings due to a decrease in the valuation allowance for deferred tax benefits.

Since there were no such allowances in the just-concluded year, Kinzler said the operating results for the company were the best on record.

For the year, Barnwell's earnings more than tripled to $11.7 million, or $1.39 a share, versus $3.5 million, or 41 cents a share, a year ago. Revenue jumped 38.4 percent to $65.6 million from $47.4 million.

The company, which also has Big Island real estate holdings and conducts water-drilling operations statewide, said the full-year earnings were boosted by a $14.8 million increase in oil and natural gas revenue as a result of higher oil, natural gas and natural gas liquid prices in its Alberta, Canada operations.

Barnwell said its full-year net income was partly offset by the recording of a $1.1 million bad debt reserve primarily against oil and natural gas receivables due to the bankruptcy filing of SemGroup LP in July of this year. Full-year earnings also included deferred tax benefits of $909,000 due to reductions in Canadian corporate income tax rates versus a reduction of $100,000 last year.

The company said that in the just-concluded fiscal year that Kaupulehu Developments, Barnwell's 77.6 percent-owned land development partnership, received $4.4 million for the seventh and a portion of the eighth of 10 scheduled option payments related to the development rights within Hualalai Resort at Kaupulehu in the North Kona district.

Due to the early receipt portion of the development rights payment, Barnwell said Kaupulehu Development receipts in the first quarter of 2009 are anticipated to be less than in the first quarter of 2008.

In its contract-drilling division, Barnwell said its operating profit more than doubled to $1.7 million for the year due to an increase in water-well drilling activity as compared to the same period a year ago.