26 In 2000, the company reported income from continuing  operations of $972 million or $3.63 per diluted share, both record highs, up 10% and 15%, respectively, from record results in 1999 (excluding the 1999 net non-operating gain principally from the television station exchange transaction discussed on page 20). The company’s operating income was $1.817 billion for the year, an increase of $254 million or 16%. Each of the company’s segments reported higher earnings for the year, with interest expense up $125 million over 1999 as previously discussed. In 1999, the company reported income from continuing  operations of $919 million or $3.26 per diluted share. However, this reflects the net non-operating gain principally from the televi- sion station exchange transaction discussed on page 20. This net gain totaled $55 million pre-tax ($33 million after tax or $.11 per diluted share). For purposes of evaluating the company’s earnings progress from ongoing operations, the earnings summary below excludes the effect of the non-operating gain in 1999 and discontinued cable operations. Excluding non-recurring items, the company’s reported  earnings from continuing operations in 1999 were $886 million,  a 13% increase, with diluted earnings per share at $3.15, up 15%; operating income reached $1.563 billion, an increase of $177  million or 13%. The strong, record showing in operating income and after-tax results for 1999 came from newspapers. Broadcast earnings were down 2%. Interest expense was 19% higher. Return on shareholders’ equity (before non-recurring gains and accounting  principle changes) in percentages The percentage return on equity for 2001, 2000 and 1999 has declined from the prior years because non-recurring gains from the sale/exchange of businesses are included in shareholders’ equi- ty, but are excluded from the amount of earnings from continuing operations used in the calculation. The return on equity in 2001 is lower than in 2000 due to lower earnings and higher equity. The Consolidated Statements of Changes in Shareholders’ Equity appears on page 34. The company reported net income of $831 million or $3.12 per diluted share in 2001.  Average diluted shares outstanding for 2001 totaled 266,833,000, compared to 268,118,000 in 2000. Basic shares totaled 264,821,000 for 2001 and 266,426,000 for 2000.  The company’s return on shareholders’ equity, based on earn- ings from continuing operations, is presented in the table below. After-tax earnings from the cable business for the period it was owned, up to the date of sale, are also reported as income from discontinued operations and amounted to $2.4 million or $.01 per diluted share in 2000 and $38.5 million or $.14 per diluted share in 1999. Net income As part of the Multimedia purchase in 1995, the company acquired cable television operations. On Jan. 31, 2000, the  company completed the sale of its cable division for $2.7 billion. Upon closing, an after-tax gain of approximately $745 million or $2.77 per diluted share was recognized, which, along with the cable segment operating results, are reported as discontinued operations in the company’s financial statements. Discontinued operations Income from continuing operations in millions ♦ Before net non-recurring gains from sale/exchange of businesses * Before effect of accounting principle changes In millions of dollars, except per share amounts Earnings summary excluding 1999 net non-operating gain 2001 Change 2000 Change 1999 Change Operating income $1,590 (13%) $1,817 16% $1,563 13% Non-operating  expense Interest expense (222) 1% (219) 132% (95) 19% Other 3 (76%) 11 159% 4 — Total (219) 5% (208) 130% (91) 12% Income before  income taxes 1,371 (15%) 1,609 9% 1,472 13% Provision for income taxes 540 (15%) 637 9% 586 12% Income from continuing  operations $ 831 (14%) $ 972 10% $ 886 13% Earnings per share  from continuing operations – diluted $ 3.12 (14%) $ 3.63 15% $ 3.15 15% 92 $341* 93 $389 94 $455 95 $457  96 $503 ♦ 97 $681 98 $782 ♦ 99 $886 ♦ 00 $972 01 $831 92 21.9 93 22.3 94 24.4 95 23.0 96 19.8 97 21.3 98 21.0 99 20.6 00 20.0 01 15.3