UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q


☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended July 31, 2022


☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ___________ to ___________

Commission File Number: 1-4702

AMREP Corporation

(Exact Name of Registrant as Specified in its Charter)

Oklahoma		59-0936128
State or Other Jurisdiction of Incorporation or Organization		I.R.S. Employer Identification No.

850 West Chester Pike, Suite 205, Havertown, PA		19083
Address of Principal Executive Offices		Zip Code

(610) 487-0905

Registrant’s Telephone Number, Including Area Code

Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock $0.10 par value	AXR	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 (the “Exchange Act”) during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer”, “accelerated filer”, “smaller reporting company”, and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐	Accelerated filer ☐
Non-accelerated filer ☒	Smaller reporting company ☒
Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Number of Shares of Common Stock, par value $.10 per share, outstanding at September 2, 2022 – 5,254,909.

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AMREP CORPORATION AND SUBSIDIARIES

INDEX

		PAGE NO.
PART I. FINANCIAL INFORMATION

Item 1.	Financial Statements

	Condensed Consolidated Balance Sheets July 31, 2022 (Unaudited) and April 30, 2022	2

	Condensed Consolidated Statements of Operations (Unaudited) Three Months Ended July 31, 2022 and 2021	3

	Condensed Consolidated Statements of Comprehensive Income (Unaudited) Three Months Ended July 31, 2022 and 2021	4

	Condensed Consolidated Statements of Shareholders’ Equity (Unaudited) Three Months Ended July 31, 2022 and 2021	5

	Condensed Consolidated Statements of Cash Flows (Unaudited) Three Months Ended July 31, 2022 and 2021	6

	Notes to Condensed Consolidated Financial Statements (Unaudited)	7

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	12

Item 4.	Controls and Procedures	18

PART II. OTHER INFORMATION

Item 6.	Exhibits	19

SIGNATURE		20

EXHIBIT INDEX		21

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PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

AMREP CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Amounts in thousands, except share and per share amounts)


	July 31,		April 30,
	2022		2022
	(Unaudited)
ASSETS
Cash and cash equivalents	$	15,915	$	15,721
Real estate inventory		68,604		67,249
Investment assets		8,961		9,017
Other assets		2,082		1,882
Deferred income taxes, net		928		958
Prepaid pension costs		311		90
TOTAL ASSETS	$	96,801	$	94,917

LIABILITIES AND SHAREHOLDERS’ EQUITY
LIABILITIES:
Accounts payable and accrued expenses	$	4,976	$	6,077
Notes payable		2,080		2,030
Taxes payable, net		4,428		3,648
TOTAL LIABILITIES		11,484		11,755

SHAREHOLDERS' EQUITY:
Common stock, $.10 par value; shares authorized – 20,000,000; shares issued – 5,254,909 at July 31, 2022 and 5,240,309 at April 30, 2022		526		524
Capital contributed in excess of par value		32,558		32,383
Retained earnings		56,740		54,828
Accumulated other comprehensive loss, net		(4,507)		(4,573)
TOTAL SHAREHOLDERS’ EQUITY		85,317		83,162
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	96,801	$	94,917

The accompanying notes to condensed consolidated financial statements are an integral part of these condensed consolidated financial statements.

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AMREP CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

Three Months ended July 31, 2022 and 2021

(Amounts in thousands, except per share amounts)


	Three Months ended
	July 31,
	2022		2021
REVENUES:
Land sale revenues	$	5,172	$	7,190
Home sale revenues		5,439		2,411
Other revenues		621		906
Total revenues		11,232		10,507

COSTS AND EXPENSES:
Land sale cost of revenues		3,832		5,610
Home sale cost of revenues		3,663		1,914
General and administrative expenses		1,171		1,188
Total costs and expenses		8,666		8,712
Operating income		2,566		1,795

Interest income, net		7		1
Other income		—		230
Income before income taxes		2,573		2,026

Provision for income taxes		661		389
Net income	$	1,912	$	1,637

Basic earnings per share	$	0.36	$	0.22
Diluted earnings per share	$	0.36	$	0.22
Weighted average number of common shares outstanding – basic		5,274		7,346
Weighted average number of common shares outstanding – diluted		5,296		7,373

The accompanying notes to condensed consolidated financial statements are an integral part of these condensed consolidated financial statements.

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AMREP CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED)

Three Months ended July 31, 2022 and 2021

(Amounts in thousands)


	Three Months ended
	July 31,
	2022		2021
Net income	$	1,912	$	1,637
Other comprehensive income, net of tax:
Decrease in pension liability		97		97
Income tax effect		(31)		(31)
Decrease in pension liability, net of tax		66		66
Other comprehensive income		66		66
Total comprehensive income	$	1,978	$	1,703

The accompanying notes to condensed consolidated financial statements are an integral part of these condensed consolidated financial statements.

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AMREP CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY (UNAUDITED)

Three Months ended July 31, 2022 and 2021

(Amounts in thousands)


				Capital				Accumulated
				Contributed				Other
	Common Stock			in Excess of		Retained		Comprehensive
	Shares	Amount		Par Value		Earnings		Loss		Total
Balance, May 1, 2022	5,240	$	524	$	32,383	$	54,828	$	(4,573)	$	83,162
Issuance of restricted common stock	15		2		162		—		—		164
Issuance of option to purchase common stock	—		—		13		—		—		13
Net income	—		—		—		1,912		—		1,912
Other comprehensive income	—		—		—		—		66		66
Balance, July 31, 2022	5,255	$	526	$	32,558	$	56,740	$	(4,507)	$	85,317

Balance, May 1, 2021	7,323	$	730	$	45,072	$	47,710	$	(4,623)	$	88,889
Issuance of restricted common stock	13		1		149		—		—		150
Net income	—		—		—		1,637		—		1,637
Other comprehensive income	—		—		—		—		66		66
Balance, July 31, 2021	7,336	$	731	$	45,221	$	49,347	$	(4,557)	$	90,742

The accompanying notes to condensed consolidated financial statements are an integral part of these condensed consolidated financial statements.

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AMREP CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

Three Months ended July 31, 2022 and 2021

(Amounts in thousands)


	Three Months ended July 31,
	2022		2021
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	1,912	$	1,637
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation		8		104
Amortization of debt issuance costs		—		34
Non-cash credits and charges:
Stock-based compensation		36		16
Deferred income tax provision		—		456
Net periodic pension cost		(124)		(123)
Gain on debt forgiveness		—		(45)
Changes in assets and liabilities:
Real estate inventory and investment assets		(1,299)		(5,709)
Other assets		56		(12)
Accounts payable and accrued expenses		(1,107)		(758)
Taxes payable (receivable), net		780		(66)
Net cash provided by (used in) operating activities		262		(4,466)

CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures		(118)		(1)
Net cash used in investing activities		(118)		(1)

CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from debt financing		50		6,857
Principal debt payments		—		(3,867)
Payments for debt issuance costs		—		(50)
Net cash provided by financing activities		50		2,940

Increase (decrease) in cash and cash equivalents		194		(1,527)
Cash and cash equivalents, beginning of period		15,721		24,801
Cash and cash equivalents, end of period	$	15,915	$	23,274

SUPPLEMENTAL CASH FLOW INFORMATION:
Income taxes refunded, net	$	—	$	(3)
Interest paid	$	16	$	40

The accompanying notes to condensed consolidated financial statements are an integral part of these condensed consolidated financial statements.

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AMREP CORPORATION AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Unaudited)

Three Months Ended July 31, 2022 and 2021

(1) SUMMARY OF SIGNIFICANT ACCOUNTING AND FINANCIAL REPORTING POLICIES

The accompanying unaudited condensed consolidated financial statements have been prepared by AMREP Corporation (the “Company”) pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) for interim financial information, and do not include all the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements. The Company, through its subsidiaries, is primarily engaged in two business segments: land development and homebuilding. The Company has no foreign sales or activities outside the United States. Unless the context otherwise indicates, all references to the Company in this quarterly report on Form 10-Q include the Company and its subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation.

In the opinion of management, these unaudited condensed consolidated financial statements include all adjustments, which are of a normal recurring nature, considered necessary to reflect a fair presentation of the results for the interim periods presented. The results of operations for such interim periods are not necessarily indicative of what may occur in future periods. Unless the context otherwise indicates, all references to 2023 and 2022 are to the fiscal years ending April 30, 2023 and 2022.

The unaudited condensed consolidated financial statements herein should be read in conjunction with the Company’s annual report on Form 10-K for the year ended April 30, 2022, which was filed with the SEC on July 21, 2022 (the “2022 Form 10-K”). Certain 2022 balances in these condensed consolidated financial statements have been reclassified to conform to the current year presentation with no effect on net income or shareholders’ equity.

Summary of Significant Accounting Policies

The significant accounting policies used in preparing these condensed consolidated financial statements are consistent with the accounting policies described in the 2022 Form 10-K.

New Accounting Pronouncements

There are no new accounting standards or updates to be adopted that the Company currently believes might have a significant impact on its condensed consolidated financial statements.

(2) REAL ESTATE INVENTORY

Real estate inventory consists of (in thousands):


	July 31,		April 30,
	2022		2022
Land held for development or sale in New Mexico	$	60,528	$	59,374
Land held for development or sale in Colorado		3,435		3,434
Homebuilding finished inventory		1,005		1,135
Homebuilding construction in process		3,636		3,306
	$	68,604	$	67,249

(3) INVESTMENT ASSETS

Investment assets consist of land held for long-term investment.

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(4) OTHER ASSETS

Other assets consist of (in thousands):