10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

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

For the quarterly period ended July 31, 2020

OR

¨ 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.
620 West Germantown Pike, Suite 175 Plymouth Meeting, PA	19462
Address of Principal Executive Offices	Zip Code

             (610) 487-0905             

Registrant’s Telephone Number, Including Area Code

                                          Not Applicable                                          

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  x    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  x    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 x	Smaller reporting company x
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 x

Number of Shares of Common Stock, par value $.10 per share, outstanding at September 4, 2020 – 8,130,057.

AMREP CORPORATION AND SUBSIDIARIES

INDEX

		PAGE NO.
PART I.  FINANCIAL INFORMATION
Item 1.  Financial Statements
	Consolidated Balance Sheets July 31, 2020 (Unaudited) and April 30, 2020	1
	Consolidated Statements of Operations (Unaudited) Three Months Ended July 31, 2020 and 2019	2
	Consolidated Statements of Comprehensive Income (Loss) (Unaudited) Three Months Ended July 31, 2020 and 2019	3
	Consolidated Statements of Shareholders’ Equity (Unaudited) Three Months Ended July 31, 2020 and 2019	4
	Consolidated Statements of Cash Flows (Unaudited) Three Months Ended July 31, 2020 and 2019	5
	Notes to Consolidated Financial Statements (Unaudited)	6
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	11
Item 4.  Controls and Procedures		16
PART II.  OTHER INFORMATION
Item 6.  Exhibits		16
SIGNATURE		18
EXHIBIT INDEX		19

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

AMREP CORPORATION AND SUBSIDIARIES

Consolidated Balance Sheets

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

ASSETS	July 31, 2020			April 30, 2020
	(Unaudited)
Cash and cash equivalents	$	17,068		$	17,502
Real estate inventory		57,216			53,449
Investment assets, net		18,798			18,644
Other assets		959			934
Taxes receivable, net		57			57
Deferred income taxes, net		5,893			6,080
TOTAL ASSETS	$	99,991		$	96,666
LIABILITIES AND SHAREHOLDERS’ EQUITY
LIABILITIES:
Accounts payable and accrued expenses	$	4,105		$	3,125
Notes payable, net		5,496			3,890
Accrued pension costs		5,028			5,014
TOTAL LIABILITIES		14,629			12,029
SHAREHOLDERS’ EQUITY:
Common stock, $.10 par value; shares authorized – 20,000,000; shares issued – 8,367,154 at July 31, 2020 and 8,358,154 at April 30, 2020		837			836
Capital contributed in excess of par value		51,375			51,334
Retained earnings		43,742			43,149
Accumulated other comprehensive loss, net		(6,377	)		(6,467	)
Treasury stock, at cost – 225,250 shares at July 31, 2020 and April 30, 2020		(4,215	)		(4,215	)
TOTAL SHAREHOLDERS’ EQUITY		85,362			84,637
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	99,991		$	96,666

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

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AMREP CORPORATION AND SUBSIDIARIES

Consolidated Statements of Operations (Unaudited)

Three Months Ended July 31, 2020 and 2019

(Amounts in thousands, except per share amounts)

	2020		2019
REVENUES:
Real estate land sales	$	3,487	$	4,291
Rental income		350		341
Other		369		135
Total Revenues		4,206		4,767
COSTS AND EXPENSES:
Real estate land sales		2,679		3,655
Real estate operating expenses		677		559
General and administrative expenses:
Real estate operations		41		113
Corporate operations		726		894
Operating expenses		4,123		5,221
Operating income (loss)		83		(454	)
Interest income, net		6		124
Other income		650		-
Income (loss) from operations before income taxes		739		(330	)
Provision (benefit) for income taxes		146		(134	)
Net income (loss)	$	593	$	(196	)
Basic and diluted earnings (loss) per share	$	0.07	$	(0.02	)
Weighted average number of common shares outstanding – basic		8,151		8,095
Weighted average number of common shares outstanding – diluted		8,182		8,095

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

2

AMREP CORPORATION AND SUBSIDIARIES

Consolidated Statements of Comprehensive Income (Loss) (Unaudited)

Three Months Ended July 31, 2020 and 2019

(Amounts in thousands)

	2020		2019
Net income (loss)	$	593	$	(196	)
Other comprehensive income, net of tax:
Decrease in pension liability, net of tax ($42 in 2020 and $67 in 2019)		90		154
Other comprehensive income		90		154
Total comprehensive income (loss)	$	683	$	(42	)

The accompanying notes to consolidated financial statements are an

integral part of these consolidated financial statements.

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AMREP CORPORATION AND SUBSIDIARIES

Consolidated Statements of Shareholders’ Equity (Unaudited)

(Amounts in thousands)

	Common Stock				Capital Contributed in Excess of		Retained			Accumulated Other Comprehensive			Treasury Stock, at
	Shares		Amount		Par Value		Earnings			Loss			Cost			Total
Balance, May 1, 2020		8,358	$	836	$	51,334	$	43,149		$	(6,467	)	$	(4,215	)	$	84,637
Issuance of restricted common stock		9		1		41		-			-			-			42
Net income								593									593
Other comprehensive income		-		-		-		-			90			-			90
Balance, July 31, 2020		8,367	$	837	$	51,375	$	43,742		$	(6,377	)	$	(4,215	)	$	85,362
Balance, May 1, 2019		8,353	$	835	$	51,205	$	49,052		$	(7,031	)	$	(4,215	)	$	89,846
Issuance of restricted common stock		9		1		56		-			-			-			57
Net loss								(196	)								(196	)
Other comprehensive income		-		-		-		-			154			-			154
Balance, July 31, 2019		8,362	$	836	$	51,261	$	48,856		$	(6,877	)	$	(4,215	)	$	89,861

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

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AMREP CORPORATION AND SUBSIDIARIES

Consolidated Statements of Cash Flows (Unaudited)

Three Months Ended July 31, 2020 and 2019

(Amounts in thousands)

	2020			2019
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)	$	593		$	(196	)
Adjustments to reconcile net income (loss) to net cash (used in) provided by operating activities:
Depreciation		129			127
Amortization of debt issuance costs		3			65
Non-cash credits and charges:
Interest earned on deferred purchase price		-			(64	)
Stock-based compensation		40			48
Deferred income tax provision (benefit)		187			(134	)
Net periodic pension cost		87			186
Deferred Rent		-			(24	)
Changes in assets and liabilities:
Real estate inventory and investment assets		(4,050	)		2,255
Other assets		(29	)		(104	)
Accounts payable and accrued expenses		980			45
Total adjustments		(2,653	)		2,400
Net cash (used in) provided by operating activities		(2,060	)		2,204
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures		(3	)		(1	)
Net cash used in investing activities		(3	)		(1	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from debt financing		2,293			29
Principal debt payments		(637	)		(572	)
Payments for debt issuance costs		(27	)		-
Net cash provided by (used in) financing activities		1,629			(543	)
(Decrease) increase in cash, cash equivalents and restricted cash		(434	)		1,660
Cash, cash equivalents and restricted cash, beginning of period		17,502			14,236
Cash, cash equivalents and restricted cash, end of period	$	17,068		$	15,896
SUPPLEMENTAL CASH FLOW INFORMATION:
Interest paid	$	30		$	53
Right-of-use assets obtained in exchange for operating lease liabilities	$	-		$	198

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

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AMREP CORPORATION AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Unaudited)

Three Months Ended July 31, 2020 and 2019

(1)       SUMMARY OF SIGNIFICANT ACCOUNTING AND FINANCIAL REPORTING POLICIES

The accompanying unaudited 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 one business segment: the real estate business. The Company has no foreign sales. All significant intercompany accounts and transactions have been eliminated in consolidation.

In the opinion of management, these unaudited 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 2021 and 2020 are to the fiscal years ending April 30, 2021 and 2020 and all references to the first quarters of 2021 and 2020 mean the fiscal three month periods ended July 31, 2020 and 2019.

The unaudited 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, 2020, which was filed with the SEC on July 27, 2020 (the “2020 Form 10-K”). Certain 2020 balances in these financial statements have been reclassified to conform to the current year presentation with no effect on net income (loss) or shareholders’ equity.

Summary of Significant Accounting Policies

The significant accounting policies used in preparing these consolidated financial statements are consistent with the accounting policies described in the 2020 Form 10-K, except for those adopted as described below.

Recently Adopted Accounting Pronouncements

In August 2018, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No. 2018-13, Fair Value Measurement: Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement. ASU 2018-13 eliminates certain disclosure requirements for fair value measurements for all entities, requires public entities to disclose certain new information and modifies some disclosure requirements to improve the effectiveness of disclosures in the notes to financial statements. ASU 2018-13 was effective for the Company on May 1, 2020. The adoption of ASU 2018-13 by the Company did not have a material effect on its consolidated financial statements.

In August 2018, the FASB issued ASU No. 2018-14, Compensation—Retirement Benefits—Defined Benefit Plans—General (Subtopic 715-20): Disclosure Framework—Changes to the Disclosure Requirements for Defined Benefit Plans. ASU 2018-14 removes disclosures that no longer are considered cost beneficial, clarifies the specific requirements of disclosures and adds disclosure requirements identified as relevant for companies with defined benefit retirement plans. ASU 2018-14 was effective for the Company on May 1, 2020. The adoption of ASU 2018-14 by the Company did not have a material effect on its consolidated financial statements.

In December 2019, the FASB issued ASU No. 2019-12, Income Taxes – Simplifying the Accounting for Income Taxes, which removes certain exceptions for companies related to tax allocations and simplifies when companies recognize deferred tax liabilities in an interim period. ASU 2019-12 will be effective for the Company’s fiscal year beginning May 1, 2021. The Company is currently evaluating the impact that this ASU will have on the Company’s consolidated financial statements.

6

(2)        RESTRICTED CASH

The following provides a reconciliation of the Company’s cash, cash equivalents and restricted cash as reported in the consolidated statement of cash flows for the three month period ending July 31, 2019:

	July 31,		April 30,
	2019		2019
	(in thousands)
Cash and cash equivalents	$	15,591	$	13,267
Restricted cash		305		969
Total cash, cash equivalents and restricted cash	$	15,896	$	14,236

There was no restricted cash at July 31, 2020 and April 30, 2020.

(3)       SETTLEMENT AGREEMENT

Refer to Note 2 to the consolidated financial statements contained in the 2020 Form 10-K for detail regarding a former business segment of the Company. During the three months ended July 31, 2020, affiliates of the Company and affiliates of this former business segment entered into a settlement agreement pursuant to which, among other things, the Company received $650,000 as a settlement payment and $350,000 for rent with respect to properties in Palm Coast, Florida for the period May 2020 through August 2020.

(4)       INVESTMENT ASSETS, NET

Investment assets, net consist of:

	July 31,			April 30,
	2020			2020
	(in thousands)
Land held for long-term investment	$	9,775		$	9,751
Construction in process		2,573			2,320
Warehouse and office facilities		13,095			13,096
Less accumulated depreciation		(6,645	)		(6,523	)
Warehouse and office facilities, net		6,450			6,573
	$	18,798		$	18,644

Land held for long-term investment represents property located in areas that are not planned to be developed in the near term and thus has not been offered for sale. As of April 30, 2020 and July 31, 2020, the Company held approximately 12,000 acres of land in New Mexico classified as land held for long-term investment. Construction in process relates to construction costs of a single tenant retail building in the Las Fuentes at Panorama Village subdivision in Rio Rancho, New Mexico.

The warehouse and office facilities are located in Palm Coast, Florida, aggregate 204,000 square feet and are partially leased to a third party. Depreciation associated with the warehouse and office facilities of $122,000 was charged to operations for each of the three months ended July 31, 2020 and July 31, 2019.

(5)       OTHER ASSETS

Other assets consist of:

	July 31,		April 30,
	2020		2020
	(in thousands)
Prepaid expenses and miscellaneous other, net	$	959	$	934
	$	959	$	934

Miscellaneous other, net includes property and equipment and right-of-use assets associated with leases of office facilities. Depreciation expense associated with property and equipment was $7,000 and $4,000 for the three months ended July 31, 2020 and July 31, 2019. Right-of-use assets associated with leases of office facilities were $83,000 as of July 31, 2020, and $175,000 as of July 31, 2019.

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(6)       ACCOUNTS PAYABLE AND ACCRUED EXPENSES

Accounts payable and accrued expenses consist of:

	July 31,		April 30,
	2020		2020
	(in thousands)
Real estate operations
Accrued expenses	$	371	$	518
Trade payables		1,609		1,146
Real estate customer deposits		1,143		1,117
Other		59		-
		3,182		2,781
Corporate operations		923		344
	$	4,105	$	3,125

(7)       NOTES PAYABLE

Notes payable, net consist of: 

	July 31,			April 30,
	2020			2020
	(in thousands)
Real estate notes payable	$	5,523		$	3,894
Unamortized debt issuance costs		(27	)		(4	)
	$	5,496		$	3,890

Refer to Notes 8 and 17 to the consolidated financial statements contained in the 2020 Form 10-K for additional detail about each of the following outstanding financing facilities:

· Lomas Encantadas Subdivision. In June 2019, BOKF, NA dba Bank of Albuquerque (“BOKF”) provided a non-revolving line of credit to Lomas Encantadas Development Company LLC (“LEDC”), a subsidiary of the Company. The initial available principal amount of the loan was $2,475,000. The outstanding principal amount of the loan was $1,005,000 and $1,576,000 as of July 31, 2020 and April 30, 2020. LEDC made principal repayments of $637,000 during the three months ended July 31, 2020 and $675,000 during the year ended April 30, 2020. The interest rate on the loan at July 31, 2020 was 3.2%. The Company capitalized interest and fees related to this loan of $12,000 and $29,000 during the three months ended July 31, 2020 and July 31, 2019. The total book value of the property mortgaged pursuant to this loan was $3,044,000 as of July 31, 2020. At July 31, 2020, LEDC was in compliance with the financial covenants contained within the loan documentation.

· Hawk Site Subdivision. In February 2020, Sandia Laboratory Federal Credit Union (“SLFCU”) provided a revolving line of credit to Mountain Hawk East Development Company LLC (“MHEDC”), a subsidiary of the Company. The initial available principal amount of the loan was $3,000,000, subject to certain limitations. The outstanding principal amount of the loan was $41,000 as of July 31, 2020. MHEDC made no principal repayments during the three months ended July 31, 2020 or during the year ended April 30, 2020. The interest rate on the loan at July 31, 2020 was 4.5%. The Company capitalized interest and fees related to this loan of less than $1,000 during the three months ended July 31, 2020. The total book value of the property mortgaged pursuant to this loan was $1,760,000 as of July 31, 2020. At July 31, 2020, MHEDC was in compliance with the financial covenants contained within the loan documentation.

· Las Fuentes at Panorama Village Subdivision. In January 2020, BOKF provided a non-revolving line of credit to Las Fuentes Village II, LLC (“LFV”), a subsidiary of the Company. The initial available principal amount of the loan was $2,750,000. The outstanding principal amount of the loan was $2,312,000 as of July 31, 2020. LFV made no principal repayments during the three months ended July 31, 2020 or during the year ended April 30, 2020. The interest rate on the loan at July 31, 2020 was 3.08%. The Company capitalized interest and fees related to this loan of $16,000 during the three months ended July 31, 2020. The total book value of the property mortgaged pursuant to this loan was $2,870,000 as of July 31, 2020. At July 31, 2020, LFV was in compliance with the financial covenants contained within the loan documentation.

8

· Meso AM Subdivision.

o Acquisition Financing: The acquisition of the Meso AM subdivision in Bernalillo County, New Mexico in June 2020 by Lavender Fields, LLC (“LF”), a subsidiary of the Company, included $1,838,000 of deferred purchase price, of which $919,000 is payable without interest on or before June 2021 and $919,000 is payable without interest on or before June 2022. The total book value of the property mortgaged to secure payment of a note reflecting the deferred purchase price was $3,530,000 as of July 31, 2020. At July 31, 2020, LF was in compliance with the financial covenants contained within the loan documentation.

o Development Financing. In June 2020, BOKF provided a non-revolving line of credit to LF. The initial available principal amount of the loan was $3,750,000. The outstanding principal amount of the loan was $27,000 as of July 31, 2020. LF made no principal repayments during the three months ended July 31, 2020. The interest rate on the loan at July 31, 2020 was 3.75%. The Company capitalized interest and fees related to this loan of less than $1,000 during the three months ended July 31, 2020. The total book value of the property mortgaged pursuant to this loan was $3,530,000 as of July 31, 2020. At July 31, 2020, LF was in compliance with the financial covenants contained within the loan documentation.

· SBA Paycheck Protection Program. In April 2020, BOKF provided a loan to the Company pursuant to the Paycheck Protection Program administered by the U.S. Small Business Administration. The amount of the loan was $298,000. The outstanding principal amount of the loan was $298,000 as of July 31, 2020. The Company made no principal repayments during the three months ended July 31, 2020 or during the year ended April 30, 2020. The interest rate on the loan at July 31, 2020 was 1.0%. The Company did not capitalize any interest or fees related to this loan during the three months ended July 31, 2020. At July 31, 2020, the Company was in compliance with the financial covenants contained within the loan documentation. The loan provides that all or a portion of the principal balance may be forgiven if certain conditions are met.

Refer to Note 8 to the consolidated financial statements contained in the 2020 Form 10-K for additional detail about each of the following expired or terminated financing facilities:

· Lomas Encantadas Subdivision. In fiscal year 2018, BOKF provided a non-revolving line of credit to LEDC. The initial available principal amount of the loan was $4,750,000. During the three months ended July 31, 2019, LEDC made principal repayments of $182,000 and the Company capitalized interest and fees related to this loan of $4,000. The loan was terminated in June 2019.

· Hawk Site Subdivision. In 2019, Main Bank provided a non-revolving line of credit to Hawksite 27 Development Company, LLC (“HDC”), a subsidiary of the Company. The initial available principal amount of the loan was $1,800,000. The outstanding principal amount of the loan was $813,000 as of July 31, 2019. During the three months ended July 31, 2019, HDC made principal repayments of $390,000 and the Company capitalized interest and fees related to this loan of $20,000. The loan was terminated in August 2019.

The following table summarizes the scheduled principal repayments subsequent to July 31, 2020:

Fiscal Year	Scheduled Payments (in thousands)
2021	$	3,094
2022		2,388
2023		41
Total	$	5,523

(8)       REVENUES

100% of real estate land sales were made to four customers during the three months ended July 31, 2020 and to five customers during the three months ended July 31, 2019.

(9)      OTHER REVENUES

Other revenues consist of:

	Three Months Ended July 31,
	2020		2019
	(in thousands)
Oil & gas royalties	$	11	$	-
Private infrastructure reimbursement covenants		133		91
Public improvement district reimbursements		175		-
Miscellaneous other revenue		50		44
	$	369	$	135

9

Refer to Note 9 to the consolidated financial statements contained in the 2020 Form 10-K for additional detail about each category of other revenues. Miscellaneous other revenue for the three months ended July 31, 2020 primarily consisted of payments for impact fee credits. Miscellaneous other revenue for the three months ended July 31, 2019 primarily consisted of forfeited deposits and amortization of deferred revenue (refer to Note 2 to the consolidated financial statements contained in the 2020 Form 10-K for detail regarding amortization of deferred revenue with respect to a former business segment of the Company).

(10)       BENEFIT PLANS

Pension Plan

Refer to Note 11 to the consolidated financial statements contained in the 2020 Form 10-K for detail regarding the Company’s defined benefit pension plan. The Company recognizes the known changes in the funded status of the pension plan in the period in which the changes occur through other comprehensive income, net of the related deferred income tax effect. The Company recognized other comprehensive income of $90,000 and $154,000 for the three months ended July 31, 2020 and July 31, 2019, related to a decrease in the Company’s pension liability, net of tax. The Company funds the pension plan in compliance with IRS funding requirements. The Company did not make any contributions to the pension plan during the three months ended July 31, 2020 or July 31, 2019. 

Equity Compensation Plan

Refer to Note 10 to the consolidated financial statements contained in the 2020 Form 10-K for detail regarding the AMREP Corporation 2016 Equity Compensation Plan (the “Equity Plan”). The Company issued 9,000 shares of restricted common stock under the Equity Plan during each of the three months ended July 31, 2020 and July 31, 2019. During the three months ended July 31, 2020 and July 31, 2019, 9,500 shares and 10,000 shares of restricted common stock previously issued under the Equity Plan vested. As of July 31, 2020 and July 31, 2019, 32,334 shares and 41,667 shares of restricted common stock previously issued under the Equity Plan had not vested. For the three months ended July 31, 2020 and July 31, 2019, the Company recognized $18,000 and $25,000 of non-cash compensation expense related to the vesting of restricted shares of common stock. As of July 31, 2020 and July 31, 2019, there was $94,000 and $164,000 of unrecognized compensation expense related to restricted shares of common stock previously issued under the Equity Plan which had not vested as of those dates, which is expected to be recognized over the remaining vesting term not to exceed three years. In addition, the Company recognized $22,000 and $23,000 of non-cash expense during the three months ended July 31, 2020 and July 31, 2019 related to deferred stock units expected to be issued to non-employee members of the Company’s Board of Directors.

(11)       INTEREST INCOME, NET

Interest income, net consists of:

	July 31,		July 31,
	2020		2019
	(in thousands)
Interest income on savings	$	6	$	60
Interest on deferred purchase price		-		64
	$	6	$	124

Refer to Note 2 to the consolidated financial statements contained in the 2020 Form 10-K for detail regarding the deferred purchase price with respect to a former business segment of the Company.

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(12)       OTHER INCOME

Other income for the three months ended July 31, 2020 consisted of a settlement payment of $650,000 from a former business segment of the Company (refer to Note 2 to the consolidated financial statements contained in the 2020 Form 10-K for detail regarding the settlement agreement).

(13)       SUBSEQUENT EVENT

In August 2020, the Company repurchased 11,847 shares of common stock of the Company at a price of $4.48 per share in a privately negotiated transaction. As of the date of the repurchase, the repurchased shares were retired and returned to the status of authorized but unissued shares of common stock.

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

INTRODUCTION

AMREP Corporation (the “Company”), through its subsidiaries, is primarily engaged in the real estate business. The Company has no foreign sales or activities outside the United States. All references to the Company in this quarterly report on Form 10-Q include the Registrant and its subsidiaries. The following provides information that management believes is relevant to an assessment and understanding of the Company’s consolidated results of operations and financial condition. The information contained in this section should be read in conjunction with the consolidated financial statements and related notes thereto included in this report on Form 10-Q and with the Company’s annual report on Form 10-K for the year ended April 30, 2020, which was filed with the Securities and Exchange Commission on July 27, 2020 (the “2020 Form 10-K”). Many of the amounts and percentages presented in this Item 2 have been rounded for convenience of presentation. Unless the context otherwise indicates, all references to 2020 and 2019 are to the fiscal years ending April 30, 2020 and 2019 and all references to the first quarters of 2020 and 2019 mean the fiscal three month periods ended July 31, 2020 and 2019.

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CRITICAL ACCOUNTING POLICIES AND ESTIMATES

Management’s discussion and analysis of financial condition and results of operations is based on the accounting policies used and disclosed in the 2020 consolidated financial statements and accompanying notes that were prepared in accordance with accounting principles generally accepted in the United States of America and included as part of the 2020 Form 10-K and in Note 1 of the notes to the consolidated financial statements included in this report on Form 10-Q. The preparation of those consolidated financial statements required management to make estimates and assumptions that affected the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual amounts or results could differ from those estimates and assumptions.

The Company’s critical accounting policies, assumptions and estimates are described in Item 7 of Part II of the 2020 Form 10-K. There have been no changes in these critical accounting policies.

The significant accounting policies of the Company are described in Note 1 to the consolidated financial statements contained in the 2020 Form 10-K and in Note 1 of the notes to the consolidated financial statements included in this report on Form 10-Q. Information concerning the Company’s implementation and the impact of recent accounting standards issued by the Financial Accounting Standards Board is included in the notes to the consolidated financial statements contained in the 2020 Form 10-K and in the notes to the consolidated financial statements included in this report on Form 10-Q. The Company did not adopt any accounting policy in the three months ended July 31, 2020 that had a material effect on its consolidated financial statements.

The Company adopted the following accounting policies effective May 1, 2020:

· In August 2018, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No. 2018-13, Fair Value Measurement: Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement. ASU 2018-13 eliminates certain disclosure requirements for fair value measurements for all entities, requires public entities to disclose certain new information and modifies some disclosure requirements to improve the effectiveness of disclosures in the notes to financial statements. ASU 2018-13 was effective for the Company’s fiscal year beginning May 1, 2020. The adoption of ASU 2018-13 by the Company did not have a material effect on its consolidated financial statements.

· In August 2018, the FASB issued ASU No. 2018-14, Compensation—Retirement Benefits—Defined Benefit Plans—General (Subtopic 715-20): Disclosure Framework—Changes to the Disclosure Requirements for Defined Benefit Plans. ASU 2018-14 removes disclosures that no longer are considered cost beneficial, clarifies the specific requirements of disclosures and adds disclosure requirements identified as relevant for companies with defined benefit retirement plans. ASU 2018-14 was effective for the Company’s fiscal year beginning May 1, 2020. The adoption of ASU 2018-14 by the Company did not have a material effect on its consolidated financial statements.

RESULTS OF OPERATIONS

For the first quarter of 2021, the Company recorded net income of $593,000, or $0.07 per share, compared to a net loss of $196,000, or $0.02 per share, for the first quarter of 2020. Revenues were $4,206,000 for the first quarter of 2021 compared to $4,767,000 for the same period of 2020.

12

Revenues from land sales were $3,487,000 for the first quarter of 2021 compared to $4,291,000 for the same period of 2020. For the first quarters of 2021 and 2020, the Company’s land sales in New Mexico were as follows (dollars in thousands):

	Three Months Ended July 31, 2020						Three Months Ended July 31, 2019
	Acres Sold		Revenue		Revenue Per Acre		Acres Sold		Revenue		Revenue Per Acre
Developed
Residential		7.7	$	3,487	$	453		10	$	4,291	$	438
Commercial		-		-		-		-		-		-
Total Developed		7.7		3,487		453		10		4,291		438
Undeveloped		-		-		-		-		-		-
Total		7.7	$	3,487	$	453		10	$	4,291	$	438

The average gross profit percentage on land sales in New Mexico before indirect costs was 23% for the first quarter of 2021 compared to 15% for the same period of 2020. The profit percentage increase is attributable to the demand for lots by builders resulting in higher revenue per developed lot. As a result of many factors, including the nature and timing of specific transactions and the type and location of land being sold, revenues, average selling prices and related average gross profits from land sales can vary significantly from period to period and prior results are not necessarily a good indication of what may occur in future periods.

Rent revenues were $350,000 for first quarter of 2021 compared to $341,000 for same period of 2020 from the leasing of the Company’s 61,000 square foot facility and 143,000 square foot facility located in Palm Coast, Florida.

Other revenues were $369,000 for the first quarter of 2021 compared to $135,000 for the same period of 2020. Other revenues for the first quarter of 2021 primarily consisted of $11,000 of royalties received during the first quarter of 2021 from oil and gas production with respect to the Company’s mineral rights in Brighton, Colorado, $133,000 of private infrastructure reimbursements, $175,000 of public improvement reimbursements, forfeited deposits from customers, amortization of deferred revenue and miscellaneous other income items. Other revenues for the first quarter of 2020 consisted of $44,000 of forfeited deposits from customers and $91,000 of private infrastructure reimbursements.

Operating expenses for real estate increased from $559,000 for the first quarter of 2020 to $677,000 for the same period of 2021, primarily due to increased employee hiring and increased health care benefit costs.

Real estate general and administrative expenses decreased from $113,000 for the first quarter of 2020 to $41,000 for the same period of 2021, primarily due to reduced professional fees. Corporate general and administrative expenses decreased from $894,000 for the first quarter of 2020 to $726,000 for the same period of 2021, primarily due to reduced corporate headcount and lower consulting and director fees and pension expense.

Interest income, net decreased from $124,000 for the first quarter of 2020 to $6,000 for the same period of 2021, primarily due to a reduction in interest rates on cash balances and no interest earned during the first quarter of 2021 on the deferred purchase price related to the sale of the Company’s fulfillment services business, partially offset by a reduction in interest expense.

Other income for the three months ended July 31, 2020 consisted of a settlement payment of $650,000 from a former business segment of the Company (refer to Note 2 to the consolidated financial statements contained in the 2020 Form 10-K for detail regarding the settlement agreement).

The Company had a provision for income taxes of $146,000 for the first quarter of 2021 compared to a benefit for income taxes of $134,000 for the first quarter of 2020.

13

LIQUIDITY AND CAPITAL RESOURCES

The Company’s primary sources of funding for working capital requirements are cash flow from operations, bank financing for specific real estate projects and existing cash balances. The Company’s liquidity is affected by many factors, including some that are based on normal operations and some that are related to the real estate industry and the economy generally. Except as described below, there have been no material changes to the Company’s liquidity and capital resources as reflected in the Liquidity and Capital Resources section of Management’s Discussion and Analysis of Financial Condition and Results of Operations in the 2020 Form 10-K.

Operating Activities

Real estate inventory increased from $53,449,000 at April 30, 2020 to $57,216,000 at July 31, 2020, primarily due to increased land development activity, the acquisition of land and homebuilding construction, offset in part by real estate land sales. Investment assets, net increased from $18,644,000 at April 30, 2020 to $18,798,000 at July 31, 2020, primarily due to capitalization of costs related to the construction of a single tenant retail building, offset in part by depreciation. Other assets increased from $934,000 at April 30, 2020 to $959,000 at July 31, 2020, primarily due to an increase in prepaid expenses.

Accounts payable and accrued expenses increased from $3,125,000 at April 30, 2020 to $4,105,000 at July 31, 2020, primarily due to an increase in land development activity in New Mexico.

Financing Activities

Notes payable, net increased from $3,890,000 at April 30, 2020 to $5,496,000 at July 31, 2020, primarily due to additional borrowings to fund land development activities, partially offset by repayments made on outstanding borrowings.

Refer to Notes 8 and 17 to the consolidated financial statements contained in the 2020 Form 10-K for additional detail about each of the following outstanding financing facilities:

· Lomas Encantadas Subdivision. In June 2019, BOKF, NA dba Bank of Albuquerque (“BOKF”) provided a non-revolving line of credit to Lomas Encantadas Development Company LLC (“LEDC”), a subsidiary of the Company. The initial available principal amount of the loan was $2,475,000. The outstanding principal amount of the loan was $1,005,000 and $1,576,000 as of July 31, 2020 and April 30, 2020. LEDC made principal repayments of $637,000 during the three months ended July 31, 2020 and $675,000 during the year ended April 30, 2020. The interest rate on the loan at July 31, 2020 was 3.2%. The Company capitalized interest and fees related to this loan of $12,000 and $29,000 during the three months ended July 31, 2020 and July 31, 2019. The total book value of the property mortgaged pursuant to this loan was $3,044,000 as of July 31, 2020. At July 31, 2020, LEDC was in compliance with the financial covenants contained within the loan documentation.

· Hawk Site Subdivision. In February 2020, Sandia Laboratory Federal Credit Union (“SLFCU”) provided a revolving line of credit to Mountain Hawk East Development Company LLC (“MHEDC”), a subsidiary of the Company. The initial available principal amount of the loan was $3,000,000, subject to certain limitations. The outstanding principal amount of the loan was $41,000 as of July 31, 2020. MHEDC made no principal repayments during the three months ended July 31, 2020 or during the year ended April 30, 2020. The interest rate on the loan at July 31, 2020 was 4.5%. The Company capitalized interest and fees related to this loan of less than $1,000 during the three months ended July 31, 2020. The total book value of the property mortgaged pursuant to this loan was $1,760,000 as of July 31, 2020. At July 31, 2020, MHEDC was in compliance with the financial covenants contained within the loan documentation.

· Las Fuentes at Panorama Village Subdivision. In January 2020, BOKF provided a non-revolving line of credit to Las Fuentes Village II, LLC (“LFV”), a subsidiary of the Company. The initial available principal amount of the loan was $2,750,000. The outstanding principal amount of the loan was $2,312,000 as of July 31, 2020. LFV made no principal repayments during the three months ended July 31, 2020 or during the year ended April 30, 2020. The interest rate on the loan at July 31, 2020 was 3.08%. The Company capitalized interest and fees related to this loan of $16,000 during the three months ended July 31, 2020. The total book value of the property mortgaged pursuant to this loan was $2,870,000 as of July 31, 2020. At July 31, 2020, LFV was in compliance with the financial covenants contained within the loan documentation.

14

· Meso AM Subdivision.

o Acquisition Financing: The acquisition of the Meso AM subdivision in Bernalillo County, New Mexico in June 2020 by Lavender Fields, LLC (“LF”), a subsidiary of the Company, included $1,838,000 of deferred purchase price, of which $919,000 is payable without interest on or before June 2021 and $919,000 is payable without interest on or before June 2022. The total book value of the property mortgaged to secure payment of a note reflecting the deferred purchase price was $3,530,000 as of July 31, 2020. At July 31, 2020, LF was in compliance with the financial covenants contained within the loan documentation.

o Development Financing. In June 2020, BOKF provided a non-revolving line of credit to LF. The initial available principal amount of the loan was $3,750,000. The outstanding principal amount of the loan was $27,000 as of July 31, 2020. LF made no principal repayments during the three months ended July 31, 2020. The interest rate on the loan at July 31, 2020 was 3.75%. The Company capitalized interest and fees related to this loan of less than $1,000 during the three months ended July 31, 2020. The total book value of the property mortgaged pursuant to this loan was $3,530,000 as of July 31, 2020. At July 31, 2020, LF was in compliance with the financial covenants contained within the loan documentation.

· SBA Paycheck Protection Program. In April 2020, BOKF provided a loan to the Company pursuant to the Paycheck Protection Program administered by the U.S. Small Business Administration. The amount of the loan was $298,000. The outstanding principal amount of the loan was $298,000 as of July 31, 2020. The Company made no principal repayments during the three months ended July 31, 2020 or during the year ended April 30, 2020. The interest rate on the loan at July 31, 2020 was 1.0%. The Company did not capitalize any interest or fees related to this loan during the three months ended July 31, 2020. At July 31, 2020, the Company was in compliance with the financial covenants contained within the loan documentation. The loan provides that all or a portion of the principal balance may be forgiven if certain conditions are met.

In August 2020, the Company repurchased 11,847 shares of common stock of the Company at a price of $4.48 per share in a privately negotiated transaction. As of the date of the repurchase, the repurchased shares were retired and returned to the status of authorized but unissued shares of common stock.

Investing Activities

Capital expenditures were $3,000 for the first quarter of 2021 and $1,000 for the first quarter of 2020, primarily for office furniture and computer equipment.

Statement of Forward-Looking Information

The Private Securities Litigation Reform Act of 1995 provides a safe harbor for forward-looking statements made by or on behalf of the Company. The Company and its representatives may from time to time make written or oral statements that are “forward-looking”, including statements contained in this report and other filings with the Securities and Exchange Commission, reports to the Company’s shareholders and news releases. All statements that express expectations, estimates, forecasts or projections are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. In addition, other written or oral statements, which constitute forward-looking statements, may be made by or on behalf of the Company. Words such as “expects”, “anticipates”, “intends”, “plans”, “believes”, “seeks”, “estimates”, “projects”, “forecasts”, “may”, “should”, variations of such words and similar expressions are intended to identify such forward-looking statements. These statements are not guarantees of future performance and involve certain risks, uncertainties and contingencies that are difficult to predict. All forward-looking statements speak only as of the date of this report or, in the case of any document incorporated by reference, the date of that document. All subsequent written and oral forward-looking statements attributable to the Company or any person acting on behalf of the Company are qualified by the cautionary statements in this section. Many of the factors that will determine the Company’s future results are beyond the ability of management to control or predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in or suggested by such forward-looking statements.

15

The forward-looking statements contained in this report include, but are not limited to, statements regarding (1) the Company’s expected liquidity sources, (2) the availability of bank financing for projects, (3) the utilization of existing bank financing, (4) the timing of development of land held as investment assets, (5) the effect of recent accounting pronouncements, (6) the timing of recognizing unrecognized compensation expense related to shares of common stock issued under the AMREP Corporation 2016 Equity Compensation Plan, (7) the future issuance of deferred stock units to directors of the Company, (8) the future business conditions that may be experienced by the Company and (9) the forgiveness of any amounts due under the loan issued pursuant to the Paycheck Protection Program. The Company undertakes no obligation to update or publicly release any revisions to any forward-looking statement to reflect events, circumstances or changes in expectations after the date of such forward-looking statement, or to make any other forward-looking statements, whether as a result of new information, future events or otherwise.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

The Company’s management, with the participation of the Company’s Chief Executive Officer and Vice President, Finance and Accounting, has evaluated the effectiveness of the Company’s disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934) as of the end of the period covered by this report. As a result of such evaluation, the Company’s Chief Executive Officer and Vice President, Finance and Accounting have concluded that such disclosure controls and procedures were effective as of July 31, 2020 to provide reasonable assurance that the information required to be disclosed in the reports the Company files or submits under the Securities Exchange Act of 1934 is (i) recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, and (ii) accumulated and communicated to the Company’s management, including the Company’s Chief Executive Officer and Vice President, Finance and Accounting, as appropriate, to allow timely decisions regarding disclosure. The Company believes that a control system, no matter how well designed and operated, cannot provide absolute assurance that the objectives of the control system are met, and no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within a company have been detected.

Changes in Internal Control over Financial Reporting

No change in the Company’s system of internal control over “financial reporting” (as such term is defined in Rules 13a-15(f) and 15d-15(f) of the Securities Exchange Act of 1934) occurred during the most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, internal control over financial reporting.

PART II. OTHER INFORMATION

Item 6. Exhibits

Exhibit Number

Description

10.1

Settlement Agreement, dated as of May 18, 2020, among Palm Coast Data Holdco, Inc., Commerce Blvd Holdings LLC, Two Commerce LLC, Liam Lynch, Irish Studio LLC, Studio Membership Services, LLC, FulCircle Media, LLC, Media Data Resources, LLC, 11 Commerce Blvd Holdings, LLC and Palm Coast Data LLC. (Incorporated by reference to Exhibit 10.1 to Registrant’s Current Report on Form 8-K filed May 20, 2020)

16

10.2	Promissory Note, dated as of June 15, 2020, between MesoAM LLC and Lavender Fields, LLC. (Incorporated by reference to Exhibit 10.1 to Registrant’s Current Report on Form 8-K filed June 19, 2020)
10.3	Mortgage, Security Agreement and Fixture Filing, dated as of June 15, 2020, by Lavender Fields, LLC. (Incorporated by reference to Exhibit 10.2 to Registrant’s Current Report on Form 8-K filed June 19, 2020)
10.4	Development Loan Agreement, dated as of June 19, 2020, between BOKF, NA dba Bank of Albuquerque and Lavender Fields, LLC. (Incorporated by reference to Exhibit 10.3 to Registrant’s Current Report on Form 8-K filed June 19, 2020)
10.5	Non-Revolving Line of Credit Promissory Note, dated June 19, 2020, by Lavender Fields, LLC in favor of BOKF, NA dba Bank of Albuquerque. (Incorporated by reference to Exhibit 10.4 to Registrant’s Current Report on Form 8-K filed June 19, 2020)
10.6	Mortgage, Security Agreement and Financing Statement, dated as of June 19, 2020, between BOKF, NA dba Bank of Albuquerque and Lavender Fields, LLC. (Incorporated by reference to Exhibit 10.5 to Registrant’s Current Report on Form 8-K filed June 19, 2020)
10.7	Guaranty Agreement, dated as of June 19, 2020, made by AMREP Southwest Inc. for the benefit of BOKF, NA dba Bank of Albuquerque. (Incorporated by reference to Exhibit 10.6 to Registrant’s Current Report on Form 8-K filed June 19, 2020)
31.1	Certification required by Rule 13a-14(a) under the Securities Exchange Act of 1934
31.2	Certification required by Rule 13a-14(a) under the Securities Exchange Act of 1934
32	Certification required pursuant to 18 U.S.C. Section 1350
101.INS	XBRL Instance Document
101.SCH	XBRL Taxonomy Extension Schema
101.CAL	XBRL Taxonomy Extension Calculation Linkbase
101.DEF	XBRL Taxonomy Extension Definition Linkbase
101.LAB	XBRL Taxonomy Extension Label Linkbase
101.PRE	XBRL Taxonomy Extension Presentation Linkbase

17

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Date:  September 9, 2020	AMREP CORPORATION         (Registrant)
	By:	/s/ Adrienne M. Uleau
		Name: Adrienne M. Uleau Title: Vice President, Finance and Accounting (Principal Accounting Officer)

18

EXHIBIT INDEX

Exhibit Number	Description
10.1	Settlement Agreement, dated as of May 18, 2020, among Palm Coast Data Holdco, Inc., Commerce Blvd Holdings LLC, Two Commerce LLC, Liam Lynch, Irish Studio LLC, Studio Membership Services, LLC, FulCircle Media, LLC, Media Data Resources, LLC, 11 Commerce Blvd Holdings, LLC and Palm Coast Data LLC. (Incorporated by reference to Exhibit 10.1 to Registrant’s Current Report on Form 8-K filed May 20, 2020)
10.2	Promissory Note, dated as of June 15, 2020, between MesoAM LLC and Lavender Fields, LLC. (Incorporated by reference to Exhibit 10.1 to Registrant’s Current Report on Form 8-K filed June 19, 2020)
10.3	Mortgage, Security Agreement and Fixture Filing, dated as of June 15, 2020, by Lavender Fields, LLC. (Incorporated by reference to Exhibit 10.2 to Registrant’s Current Report on Form 8-K filed June 19, 2020)
10.4	Development Loan Agreement, dated as of June 19, 2020, between BOKF, NA dba Bank of Albuquerque and Lavender Fields, LLC. (Incorporated by reference to Exhibit 10.3 to Registrant’s Current Report on Form 8-K filed June 19, 2020)
10.5	Non-Revolving Line of Credit Promissory Note, dated June 19, 2020, by Lavender Fields, LLC in favor of BOKF, NA dba Bank of Albuquerque. (Incorporated by reference to Exhibit 10.4 to Registrant’s Current Report on Form 8-K filed June 19, 2020)
10.6	Mortgage, Security Agreement and Financing Statement, dated as of June 19, 2020, between BOKF, NA dba Bank of Albuquerque and Lavender Fields, LLC. (Incorporated by reference to Exhibit 10.5 to Registrant’s Current Report on Form 8-K filed June 19, 2020)
10.7	Guaranty Agreement, dated as of June 19, 2020, made by AMREP Southwest Inc. for the benefit of BOKF, NA dba Bank of Albuquerque. (Incorporated by reference to Exhibit 10.6 to Registrant’s Current Report on Form 8-K filed June 19, 2020)
31.1	Certification required by Rule 13a-14(a) under the Securities Exchange Act of 1934
31.2	Certification required by Rule 13a-14(a) under the Securities Exchange Act of 1934
32	Certification required pursuant to 18 U.S.C. Section 1350
101.INS	XBRL Instance Document
101.SCH	XBRL Taxonomy Extension Schema
101.CAL	XBRL Taxonomy Extension Calculation Linkbase
101.DEF	XBRL Taxonomy Extension Definition Linkbase
101.LAB	XBRL Taxonomy Extension Label Linkbase
101.PRE	XBRL Taxonomy Extension Presentation Linkbase

19

EX-31.1

Exhibit 31.1

CERTIFICATION

I, Adrienne M. Uleau, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q for the period ended July 31, 2020 of AMREP Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report;

4. The Registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Registrant and have:

a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) evaluated the effectiveness of the Registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) disclosed in this report any change in the Registrant’s internal control over financial reporting that occurred during the Registrant’s most recent fiscal quarter (the Registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Registrant’s internal control over financial reporting; and

5. The Registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Registrant’s auditors and the audit committee of the Registrant’s board of directors (or persons performing the equivalent functions):

a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant’s ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant’s internal control over financial reporting.

Dated: September 9, 2020

/s/ Adrienne M. Uleau

Adrienne M. Uleau

Vice President, Finance and Accounting

(Principal Financial Officer)

EX-31.2

Exhibit 31.2

CERTIFICATION

I, Christopher V. Vitale, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q for the period ended July 31, 2020 of AMREP Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report;

4. The Registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Registrant and have:

a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) evaluated the effectiveness of the Registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) disclosed in this report any change in the Registrant’s internal control over financial reporting that occurred during the Registrant’s most recent fiscal quarter (the Registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Registrant’s internal control over financial reporting; and

5. The Registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Registrant’s auditors and the audit committee of the Registrant’s board of directors (or persons performing the equivalent functions):

a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant’s ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant’s internal control over financial reporting.

Dated: September 9, 2020

/s/ Christopher V. Vitale

Christopher V. Vitale

President and Chief Executive Officer

(Principal Executive Officer)

EX-32

Exhibit 32

CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of AMREP Corporation (the “Company”) on Form 10-Q for the period ended July 31, 2020 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), each of the undersigned does hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to his knowledge:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Dated:September 9, 2020

/s/ Adrienne M. Uleau

Adrienne M. Uleau

Vice President, Finance and Accounting

(Principal Financial Officer)

/s/ Christopher V. Vitale     

Christopher V. Vitale

President and Chief Executive Officer

(Principal Executive Officer)

XML

Document And Entity Information - shares	3 Months Ended
	Jul. 31, 2020	Sep. 04, 2020
Document And Entity Information
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Jul. 31, 2020
Document Fiscal Year Focus	2021
Document Fiscal Period Focus	Q1
Entity Registrant Name	AMREP CORP.
Entity Central Index Key	0000006207
Current Fiscal Year End Date	--04-30
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		8,130,057
Trading Symbol	AXR

XML

Consolidated Balance Sheets - USD ($) $ in Thousands	Jul. 31, 2020	Apr. 30, 2020
ASSETS
Cash and cash equivalents	$ 17,068	$ 17,502
Real estate inventory	57,216	53,449
Investment assets, net	18,798	18,644
Other assets	959	934
Taxes receivable, net	57	57
Deferred income taxes, net	5,893	6,080
TOTAL ASSETS	99,991	96,666
LIABILITIES:
Accounts payable and accrued expenses	4,105	3,125
Notes payable, net	5,496	3,890
Accrued pension costs	5,028	5,014
TOTAL LIABILITIES	14,629	12,029
SHAREHOLDERS' EQUITY:
Common stock, $.10 par value; shares authorized - 20,000,000; shares issued - 8,367,154 at July 31, 2020 and 8,358,154 at April 30, 2020	837	836
Capital contributed in excess of par value	51,375	51,334
Retained earnings	43,742	43,149
Accumulated other comprehensive loss, net	(6,377)	(6,467)
Treasury stock, at cost - 225,250 shares at July 31, 2020 and April 30, 2020	(4,215)	(4,215)
TOTAL SHAREHOLDERS' EQUITY	85,362	84,637
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY	$ 99,991	$ 96,666

XML

Consolidated Balance Sheets (Parenthetical) - $ / shares	Jul. 31, 2020	Apr. 30, 2020
Consolidated Balance Sheets
Common stock, par value (in dollars per share)	$ 0.10	$ 0.10
Common stock, shares authorized	20,000,000	20,000,000
Common stock, shares issued	8,367,154	8,358,154
Treasury stock, shares	225,250	225,250

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Consolidated Statements of Operations - USD ($) $ in Thousands	3 Months Ended
	Jul. 31, 2020	Jul. 31, 2019
REVENUES:
Revenues	$ 4,206	$ 4,767
COSTS AND EXPENSES:
Real estate land sales	2,679	3,655
Real estate operating expenses	677	559
General and administrative expenses:
Real estate operations	41	113
Corporate operations	726	894
Operating expenses	4,123	5,221
Operating income (loss)	83	(454)
Interest income, net	6	124
Other income	650	0
Income (loss) from operations before income taxes	739	(330)
Provision (benefit) for income taxes	146	(134)
Net income (loss)	$ 593	$ (196)
Basic and diluted earnings (loss) per share	$ 0.07	$ (0.02)
Weighted average number of common shares outstanding - basic	8,151	8,095
Weighted average number of common shares outstanding - diluted	8,182	8,095
Real estate land sales [Member]
REVENUES:
Revenues	$ 3,487	$ 4,291
Rental income [Member]
REVENUES:
Revenues	350	341
Other [Member]
REVENUES:
Revenues	$ 369	$ 135

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Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands	3 Months Ended
	Jul. 31, 2020	Jul. 31, 2019
Consolidated Statements of Comprehensive Income (Loss)
Net income (loss)	$ 593	$ (196)
Other comprehensive income, net of tax:
Decrease in pension liability, net of tax ($42 in 2020 and $67 in 2019)	90	154
Other comprehensive income	90	154
Total comprehensive income (loss)	$ 683	$ (42)

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Consolidated Statements of Comprehensive Income (Loss) (Parenthetical) - USD ($) $ in Thousands	3 Months Ended
	Jul. 31, 2020	Jul. 31, 2019
Consolidated Statements of Comprehensive Income (Loss)
Decrease in pension liability, tax	$ 42	$ 67

XML

Consolidated Statements of Shareholders' Equity - USD ($) shares in Thousands, $ in Thousands	Common Stock [Member]	Capital Contributed in Excess of Par Value [Member]	Retained Earnings [Member]	Accumulated Other Comprehensive Loss [Member]	Treasury Stock [Member]	Total
Balance at Apr. 30, 2019	$ 835	$ 51,205	$ 49,052	$ (7,031)	$ (4,215)	$ 89,846
Balance (in shares) at Apr. 30, 2019	8,353
Issuance of restricted common stock	$ 1	56	0	0	0	57
Issuance of restricted common stock (in shares)	9
Net income (loss)	$ 0	0	(196)	0	0	(196)
Other comprehensive income	0	0	0	154	0	154
Balance at Jul. 31, 2019	$ 836	51,261	48,856	(6,877)	(4,215)	89,861
Balance (in shares) at Jul. 31, 2019	8,362
Balance at Apr. 30, 2020	$ 836	51,334	43,149	(6,467)	(4,215)	84,637
Balance (in shares) at Apr. 30, 2020	8,358
Issuance of restricted common stock	$ 1	41	0	0	0	42
Issuance of restricted common stock (in shares)	9
Net income (loss)	$ 0	0	593	0	0	593
Other comprehensive income	0	0	0	90	0	90
Balance at Jul. 31, 2020	$ 837	$ 51,375	$ 43,742	$ (6,377)	$ (4,215)	$ 85,362
Balance (in shares) at Jul. 31, 2020	8,367

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Consolidated Statements of Cash Flows - USD ($) $ in Thousands	3 Months Ended
	Jul. 31, 2020	Jul. 31, 2019
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)	$ 593	$ (196)
Adjustments to reconcile net income (loss) to net cash (used in) provided by operating activities:
Depreciation	129	127
Amortization of debt issuance costs	3	65
Non-cash credits and charges:
Interest earned on deferred purchase price	0	(64)
Stock-based compensation	40	48
Deferred income tax provision (benefit)	187	(134)
Net periodic pension cost	87	186
Deferred Rent	0	(24)
Changes in assets and liabilities:
Real estate inventory and investment assets	(4,050)	2,255
Other assets	(29)	(104)
Accounts payable and accrued expenses	980	45
Total adjustments	(2,653)	2,400
Net cash (used in) provided by operating activities	(2,060)	2,204
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures	(3)	(1)
Net cash used in investing activities	(3)	(1)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from debt financing	2,293	29
Principal debt payments	(637)	(572)
Payments for debt issuance costs	(27)	0
Net cash provided by (used in) financing activities	1,629	(543)
(Decrease) increase in cash, cash equivalents and restricted cash	(434)	1,660
Cash, cash equivalents and restricted cash, beginning of period	17,502	14,236
Cash, cash equivalents and restricted cash, end of period	17,068	15,896
SUPPLEMENTAL CASH FLOW INFORMATION:
Interest paid	30	53
Right-of-use assets obtained in exchange for operating lease liabilities	$ 0	$ 198

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SUMMARY OF SIGNIFICANT ACCOUNTING AND FINANCIAL REPORTING POLICIES

3 Months Ended

Jul. 31, 2020

SUMMARY OF SIGNIFICANT ACCOUNTING AND FINANCIAL REPORTING POLICIES

SUMMARY OF SIGNIFICANT ACCOUNTING AND FINANCIAL REPORTING POLICIES

(1)           SUMMARY OF SIGNIFICANT ACCOUNTING AND FINANCIAL REPORTING POLICIES

The accompanying unaudited 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 one business segment: the real estate business. The Company has no foreign sales. All significant intercompany accounts and transactions have been eliminated in consolidation.

In the opinion of management, these unaudited 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 2021 and 2020 are to the fiscal years ending April 30, 2021 and 2020 and all references to the first quarters of 2021 and 2020 mean the fiscal three month periods ended July 31, 2020 and 2019.

The unaudited 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, 2020, which was filed with the SEC on July 27, 2020 (the “2020 Form 10-K”). Certain 2020 balances in these financial statements have been reclassified to conform to the current year presentation with no effect on net income (loss) or shareholders’ equity. 

Summary of Significant Accounting Policies

The significant accounting policies used in preparing these consolidated financial statements are consistent with the accounting policies described in the 2020 Form 10-K, except for those adopted as described below.

Recently Adopted Accounting Pronouncements

In August 2018, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No. 2018-13, Fair Value Measurement: Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement. ASU 2018-13 eliminates certain disclosure requirements for fair value measurements for all entities, requires public entities to disclose certain new information and modifies some disclosure requirements to improve the effectiveness of disclosures in the notes to financial statements. ASU 2018-13 was effective for the Company on May 1, 2020. The adoption of ASU 2018-13 by the Company did not have a material effect on its consolidated financial statements.

In August 2018, the FASB issued ASU No. 2018-14, Compensation—Retirement Benefits—Defined Benefit Plans—General (Subtopic 715-20): Disclosure Framework—Changes to the Disclosure Requirements for Defined Benefit Plans.  ASU 2018-14 removes disclosures that no longer are considered cost beneficial, clarifies the specific requirements of disclosures and adds disclosure requirements identified as relevant for companies with defined benefit retirement plans. ASU 2018-14 was effective for the Company on May 1, 2020. The adoption of ASU 2018-14 by the Company did not have a material effect on its consolidated financial statements.

In December 2019, the FASB issued ASU No. 2019-12, Income Taxes – Simplifying the Accounting for Income Taxes, which removes certain exceptions for companies related to tax allocations and simplifies when companies recognize deferred tax liabilities in an interim period. ASU 2019-12 will be effective for the Company’s fiscal year beginning May 1, 2021.  The Company is currently evaluating the impact that this ASU will have on the Company’s consolidated financial statements.

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RESTRICTED CASH

3 Months Ended

Jul. 31, 2020

RESTRICTED CASH

RESTRICTED CASH

(2)         RESTRICTED CASH

The following provides a reconciliation of the Company’s cash, cash equivalents and restricted cash as reported in the consolidated statement of cash flows for the three month period ending July 31, 2019:

	July 31,		April 30,
	2019		2019
	(in thousands)
Cash and cash equivalents	$	15,591	$	13,267
Restricted cash		305		969
Total cash, cash equivalents and restricted cash	$	15,896	$	14,236

There was no restricted cash at July 31, 2020 and April 30, 2020.

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SETTLEMENT AGREEMENT

3 Months Ended

Jul. 31, 2020

SETTLEMENT AGREEMENT

SETTLEMENT AGREEMENT

(3)         SETTLEMENT AGREEMENT

Refer to Note 2 to the consolidated financial statements contained in the 2020 Form 10-K for detail regarding a former business segment of the Company. During the three months ended July 31, 2020, affiliates of the Company and affiliates of this former business segment entered into a settlement agreement pursuant to which, among other things, the Company received $650,000 as a settlement payment and $350,000 for rent with respect to properties in Palm Coast, Florida for the period May 2020 through August 2020.

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INVESTMENT ASSETS, NET

3 Months Ended

Jul. 31, 2020

INVESTMENT ASSETS, NET

INVESTMENT ASSETS, NET

(4)          INVESTMENT ASSETS, NET

Investment assets, net consist of:

	July 31,		April 30,
	2020		2020
	(in thousands)
Land held for long-term investment	$	9,775	$	9,751
Construction in process		2,573		2,320
Warehouse and office facilities		13,095		13,096
Less accumulated depreciation		(6,645)		(6,523)
Warehouse and office facilities, net		6,450		6,573
	$	18,798	$	18,644

Land held for long-term investment represents property located in areas that are not planned to be developed in the near term and thus has not been offered for sale. As of April 30, 2020 and July 31, 2020, the Company held approximately 12,000 acres of land in New Mexico classified as land held for long-term investment. Construction in process relates to construction costs of a single tenant retail building in the Las Fuentes at Panorama Village subdivision in Rio Rancho, New Mexico.

The warehouse and office facilities are located in Palm Coast, Florida, aggregate 204,000 square feet and are partially leased to a third party. Depreciation associated with the warehouse and office facilities of $122,000 was charged to operations for each of the three months ended July 31, 2020 and July 31, 2019.

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OTHER ASSETS

3 Months Ended

Jul. 31, 2020

OTHER ASSETS

OTHER ASSETS

(5)          OTHER ASSETS

Other assets consist of:

	July 31,		April 30,
	2020		2020
	(in thousands)
Prepaid expenses and miscellaneous other, net	$	959	$	934
	$	959	$	934

Miscellaneous other, net includes property and equipment and right-of-use assets associated with leases of office facilities. Depreciation expense associated with property and equipment was $7,000 and $4,000 for the three months ended July 31, 2020 and July 31, 2019. Right-of-use assets associated with leases of office facilities were $83,000 as of July 31, 2020, and $175,000 as of July 31, 2019.

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ACCOUNTS PAYABLE AND ACCRUED EXPENSES

3 Months Ended

Jul. 31, 2020

ACCOUNTS PAYABLE AND ACCRUED EXPENSES

ACCOUNTS PAYABLE AND ACCRUED EXPENSES

(6)          ACCOUNTS PAYABLE AND ACCRUED EXPENSES

Accounts payable and accrued expenses consist of:

	July 31,		April 30,
	2020		2020
	(in thousands)
Real estate operations
Accrued expenses	$	371	$	518
Trade payables		1,609		1,146
Real estate customer deposits		1,143		1,117
Other		59		—
		3,182		2,781
Corporate operations		923		344
	$	4,105	$	3,125

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NOTES PAYABLE

3 Months Ended

Jul. 31, 2020

NOTES PAYABLE

NOTES PAYABLE

(7)          NOTES PAYABLE

Notes payable, net consist of:

	July 31,		April 30,
	2020		2020
	(in thousands)
Real estate notes payable	$	5,523	$	3,894
Unamortized debt issuance costs		(27)		(4)
	$	5,496	$	3,890

Refer to Notes 8 and 17 to the consolidated financial statements contained in the 2020 Form 10-K for additional detail about each of the following outstanding financing facilities:

· Lomas Encantadas Subdivision. In June 2019, BOKF, NA dba Bank of Albuquerque (“BOKF”) provided a non-revolving line of credit to Lomas Encantadas Development Company LLC (“LEDC”), a subsidiary of the Company. The initial available principal amount of the loan was  $2,475,000. The outstanding principal amount of the loan was $1,005,000 and $1,576,000 as of July 31, 2020 and April  30, 2020.  LEDC made principal repayments of $637,000 during the three months ended July 31, 2020 and $675,000 during the year ended April 30, 2020. The interest rate on the loan at July 31, 2020 was 3.2%. The Company capitalized interest and fees related to this loan of $12,000 and $29,000 during the three months ended July 31, 2020 and July 31, 2019. The total book value of the property mortgaged pursuant to this loan was $3,044,000 as of July 31, 2020. At July 31, 2020, LEDC was in compliance with the financial covenants contained within the loan documentation.

· Hawk Site Subdivision. In February 2020, Sandia Laboratory Federal Credit Union (“SLFCU”) provided a revolving line of credit to Mountain Hawk East Development Company LLC (“MHEDC”), a subsidiary of the Company. The initial available principal amount of the loan was  $3,000,000, subject to certain limitations. The outstanding principal amount of the loan was $41,000 as of July 31, 2020. MHEDC made no principal repayments during the three months ended July 31, 2020 or during the year ended April 30, 2020. The interest rate on the loan at July 31, 2020 was 4.5%. The Company capitalized interest and fees related to this loan of less than $1,000 during the three months ended July 31, 2020. The total book value of the property mortgaged pursuant to this loan was $1,760,000 as of July 31, 2020. At July 31, 2020, MHEDC was in compliance with the financial covenants contained within the loan documentation. 

· Las Fuentes at Panorama Village Subdivision. In January 2020, BOKF provided a non-revolving line of credit to Las Fuentes Village II, LLC (“LFV”), a subsidiary of the Company. The initial available principal amount of the loan was  $2,750,000. The outstanding principal amount of the loan was $2,312,000 as of July 31, 2020. LFV made no principal repayments during the three months ended July 31, 2020 or during the year ended April 30, 2020. The interest rate on the loan at July 31, 2020 was 3.08%. The Company capitalized interest and fees related to this loan of $16,000 during the three months ended July 31, 2020. The total book value of the property mortgaged pursuant to this loan was $2,870,000 as of July 31, 2020. At July 31, 2020, LFV was in compliance with the financial covenants contained within the loan documentation.

· Meso AM Subdivision.  

o Acquisition Financing: The acquisition of the Meso AM subdivision in Bernalillo County, New Mexico in June 2020 by Lavender Fields, LLC (“LF”), a subsidiary of the Company, included $1,838,000 of deferred purchase price, of which $919,000 is payable without interest on or before June 2021 and $919,000 is payable without interest on or before June 2022. The total book value of the property mortgaged to secure payment of a note reflecting the deferred purchase price was $3,530,000 as of July 31, 2020. At July 31, 2020, LF was in compliance with the financial covenants contained within the loan documentation.

o Development Financing. In June 2020, BOKF provided a non-revolving line of credit to LF. The initial available principal amount of the loan was  $3,750,000. The outstanding principal amount of the loan was $27,000 as of July 31, 2020. LF made no principal repayments during the three months ended July 31, 2020. The interest rate on the loan at July 31, 2020 was 3.75%. The Company capitalized interest and fees related to this loan of less than $1,000 during the three months ended July 31, 2020. The total book value of the property mortgaged pursuant to this loan was $3,530,000 as of July 31, 2020. At July 31, 2020, LF was in compliance with the financial covenants contained within the loan documentation.

· SBA Paycheck Protection Program. In April 2020, BOKF provided a loan to the Company pursuant to the Paycheck Protection Program administered by the U.S. Small Business Administration. The amount of the loan was $298,000. The outstanding principal amount of the loan was $298,000 as of July 31, 2020. The Company made no principal repayments during the three months ended July 31, 2020 or during the year ended April 30, 2020. The interest rate on the loan at July 31, 2020 was 1.0%. The Company did not capitalize any interest or fees related to this loan during the three months ended July 31, 2020. At July 31, 2020, the Company was in compliance with the financial covenants contained within the loan documentation. The loan provides that all or a portion of the principal balance may be forgiven if certain conditions are met.

Refer to Note 8 to the consolidated financial statements contained in the 2020 Form 10-K for additional detail about each of the following expired or terminated financing facilities:

· Lomas Encantadas Subdivision. In fiscal year 2018, BOKF provided a non-revolving line of credit to LEDC. The initial available principal amount of the loan was $4,750,000. During the three months ended July 31, 2019, LEDC made principal repayments of $182,000 and the Company capitalized interest and fees related to this loan of $4,000. The loan was terminated in June 2019.

· Hawk Site Subdivision. In 2019, Main Bank provided a non-revolving line of credit to Hawksite 27 Development Company, LLC (“HDC”), a subsidiary of the Company. The initial available principal amount of the loan was $1,800,000. The outstanding principal amount of the loan was $813,000 as of July 31, 2019. During the three months ended July 31, 2019, HDC made principal repayments of $390,000 and the Company capitalized interest and fees related to this loan of $20,000. The loan was terminated in August 2019.

The following table summarizes the scheduled principal repayments subsequent to July 31, 2020:

	Scheduled Payments
Fiscal Year	(in thousands)
2021	$	3,094
2022		2,388
2023		41
Total	$	5,523

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REVENUES

3 Months Ended

Jul. 31, 2020

REVENUES:

REVENUES

(8)           REVENUES

100% of real estate land sales were made to four customers during the three months ended July 31, 2020 and to five customers during the three months ended July 31, 2019.

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OTHER REVENUES

3 Months Ended

Jul. 31, 2020

OTHER REVENUES

OTHER REVENUES

(9)          OTHER REVENUES

Other revenues consist of:

	Three Months Ended July 31,
	2020		2019
	(in thousands)
Oil & gas royalties	$	11	$	—
Private infrastructure reimbursement covenants		133		91
Public improvement district reimbursements		175		—
Miscellaneous other revenue		50		44
	$	369	$	135

Refer to Note 9 to the consolidated financial statements contained in the 2020 Form 10-K for additional detail about each category of other revenues. Miscellaneous other revenue for the three months ended July 31, 2020 primarily consisted of payments for impact fee credits. Miscellaneous other revenue for the three months ended July 31, 2019 primarily consisted of forfeited deposits and amortization of deferred revenue (refer to Note 2 to the consolidated financial statements contained in the 2020 Form 10-K for detail regarding amortization of deferred revenue with respect to a former business segment of the Company).

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BENEFIT PLANS

3 Months Ended

Jul. 31, 2020

BENEFIT PLANS

BENEFIT PLANS

(10)          BENEFIT PLANS

Pension Plan

Refer to Note 11 to the consolidated financial statements contained in the 2020 Form 10-K for detail regarding the Company’s defined benefit pension plan. The Company recognizes the known changes in the funded status of the pension plan in the period in which the changes occur through other comprehensive income, net of the related deferred income tax effect. The Company recognized other comprehensive income of $90,000 and $154,000 for the three months ended July 31, 2020 and July 31, 2019, related to a decrease in the Company’s pension liability, net of tax. The Company funds the pension plan in compliance with IRS funding requirements. The Company did not make any contributions to the pension plan during the three months ended July 31, 2020 or July 31, 2019. 

Equity Compensation Plan

Refer to Note 10 to the consolidated financial statements contained in the 2020 Form 10-K for detail regarding the AMREP Corporation 2016 Equity Compensation Plan (the “Equity Plan”). The Company issued 9,000 shares of restricted common stock under the Equity Plan during each of the three months ended July 31, 2020 and July 31, 2019. During the three months ended July 31, 2020 and July 31, 2019, 9,500 shares and 10,000 shares of restricted common stock previously issued under the Equity Plan vested.  As of July 31, 2020 and July 31, 2019, 32,334 shares and 41,667 shares of restricted common stock previously issued under the Equity Plan had not vested. For the three months ended July 31, 2020 and July 31, 2019, the Company recognized $18,000 and $25,000 of non-cash compensation expense related to the vesting of restricted shares of common stock. As of July 31, 2020 and July 31, 2019, there was $94,000 and $164,000 of unrecognized compensation expense related to restricted shares of common stock previously issued under the Equity Plan which had not vested as of those dates, which is expected to be recognized over the remaining vesting term not to exceed three years. In addition, the Company recognized $22,000 and $23,000 of non-cash expense during the three months ended July 31, 2020 and July 31, 2019 related to deferred stock units expected to be issued to non-employee members of the Company’s Board of Directors.

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INTEREST INCOME, NET

3 Months Ended

Jul. 31, 2020

INTEREST INCOME, NET

INTEREST INCOME, NET

(11)          INTEREST INCOME, NET

Interest income, net consists of:

	July 31,		July 31,
	2020		2019
	(in thousands)
Interest income on savings	$	6	$	60
Interest on deferred purchase price		—		64
	$	6	$	124

Refer to Note 2 to the consolidated financial statements contained in the 2020 Form 10-K for detail regarding the deferred purchase price with respect to a former business segment of the Company.

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OTHER INCOME

3 Months Ended

Jul. 31, 2020

OTHER INCOME

OTHER INCOME

(12)         OTHER INCOME

Other income for the three months ended July 31, 2020 consisted of a settlement payment of $650,000 from a former business segment of the Company (refer to Note 2 to the consolidated financial statements contained in the 2020 Form 10-K for detail regarding the settlement agreement).

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SUBSEQUENT EVENTS

3 Months Ended

Jul. 31, 2020

SUBSEQUENT EVENT

SUBSEQUENT EVENT

(13)          SUBSEQUENT EVENT

In August 2020, the Company repurchased 11,847 shares of common stock of the Company at a price of $4.48 per share in a privately negotiated transaction. As of the date of the repurchase, the repurchased shares were retired and returned to the status of authorized but unissued shares of common stock.

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SUMMARY OF SIGNIFICANT ACCOUNTING AND FINANCIAL REPORTING POLICIES (Policies)

3 Months Ended

Jul. 31, 2020

SUMMARY OF SIGNIFICANT ACCOUNTING AND FINANCIAL REPORTING POLICIES

Recently Adopted Accounting Pronouncements

Recently Adopted Accounting Pronouncements

In August 2018, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No. 2018-13, Fair Value Measurement: Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement. ASU 2018-13 eliminates certain disclosure requirements for fair value measurements for all entities, requires public entities to disclose certain new information and modifies some disclosure requirements to improve the effectiveness of disclosures in the notes to financial statements. ASU 2018-13 was effective for the Company on May 1, 2020. The adoption of ASU 2018-13 by the Company did not have a material effect on its consolidated financial statements.

In August 2018, the FASB issued ASU No. 2018-14, Compensation—Retirement Benefits—Defined Benefit Plans—General (Subtopic 715-20): Disclosure Framework—Changes to the Disclosure Requirements for Defined Benefit Plans.  ASU 2018-14 removes disclosures that no longer are considered cost beneficial, clarifies the specific requirements of disclosures and adds disclosure requirements identified as relevant for companies with defined benefit retirement plans. ASU 2018-14 was effective for the Company on May 1, 2020. The adoption of ASU 2018-14 by the Company did not have a material effect on its consolidated financial statements.

In December 2019, the FASB issued ASU No. 2019-12, Income Taxes – Simplifying the Accounting for Income Taxes, which removes certain exceptions for companies related to tax allocations and simplifies when companies recognize deferred tax liabilities in an interim period. ASU 2019-12 will be effective for the Company’s fiscal year beginning May 1, 2021.  The Company is currently evaluating the impact that this ASU will have on the Company’s consolidated financial statements.

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RESTRICTED CASH (Tables)

3 Months Ended

Jul. 31, 2020

RESTRICTED CASH

Schedule Of Restricted Cash

	July 31,		April 30,
	2019		2019
	(in thousands)
Cash and cash equivalents	$	15,591	$	13,267
Restricted cash		305		969
Total cash, cash equivalents and restricted cash	$	15,896	$	14,236

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INVESTMENT ASSETS, NET (Tables)

3 Months Ended

Jul. 31, 2020

INVESTMENT ASSETS, NET

Schedule of investment assets

	July 31,		April 30,
	2020		2020
	(in thousands)
Land held for long-term investment	$	9,775	$	9,751
Construction in process		2,573		2,320
Warehouse and office facilities		13,095		13,096
Less accumulated depreciation		(6,645)		(6,523)
Warehouse and office facilities, net		6,450		6,573
	$	18,798	$	18,644

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OTHER ASSETS (Tables)

3 Months Ended

Jul. 31, 2020

OTHER ASSETS

Schedule of other assets

	July 31,		April 30,
	2020		2020
	(in thousands)
Prepaid expenses and miscellaneous other, net	$	959	$	934
	$	959	$	934

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ACCOUNTS PAYABLE AND ACCRUED EXPENSES (Tables)

3 Months Ended

Jul. 31, 2020

ACCOUNTS PAYABLE AND ACCRUED EXPENSES

Schedule of accounts payable and accrued expenses

	July 31,		April 30,
	2020		2020
	(in thousands)
Real estate operations
Accrued expenses	$	371	$	518
Trade payables		1,609		1,146
Real estate customer deposits		1,143		1,117
Other		59		—
		3,182		2,781
Corporate operations		923		344
	$	4,105	$	3,125

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NOTES PAYABLE (Tables)

3 Months Ended

Jul. 31, 2020

NOTES PAYABLE

Schedule of Notes payable

Notes payable, net consist of:

	July 31,		April 30,
	2020		2020
	(in thousands)
Real estate notes payable	$	5,523	$	3,894
Unamortized debt issuance costs		(27)		(4)
	$	5,496	$	3,890

Schedule of scheduled principal repayments subsequent to reporting date

The following table summarizes the scheduled principal repayments subsequent to July 31, 2020:

	Scheduled Payments
Fiscal Year	(in thousands)
2021	$	3,094
2022		2,388
2023		41
Total	$	5,523

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OTHER REVENUES (Tables)

3 Months Ended

Jul. 31, 2020

OTHER REVENUES

Schedule of other revenues

Other revenues consist of:

	Three Months Ended July 31,
	2020		2019
	(in thousands)
Oil & gas royalties	$	11	$	—
Private infrastructure reimbursement covenants		133		91
Public improvement district reimbursements		175		—
Miscellaneous other revenue		50		44
	$	369	$	135

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INTEREST INCOME, NET (Tables)

3 Months Ended

Jul. 31, 2020

INTEREST INCOME, NET

Schedule of interest income net

Interest income, net consists of:

	July 31,		July 31,
	2020		2019
	(in thousands)
Interest income on savings	$	6	$	60
Interest on deferred purchase price		—		64
	$	6	$	124

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RESTRICTED CASH (Details) - USD ($) $ in Thousands	Jul. 31, 2020	Apr. 30, 2020	Jul. 31, 2019	Apr. 30, 2019
RESTRICTED CASH
Cash and cash equivalents	$ 17,068	$ 17,502	$ 15,591	$ 13,267
Restricted cash			305	969
Total cash, cash equivalents and restricted cash	$ 17,068	$ 17,502	$ 15,896	$ 14,236

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RESTRICTED CASH - Additional information (Details) - USD ($) $ in Thousands	Jul. 31, 2020	Apr. 30, 2020
RESTRICTED CASH
Restricted Cash and Cash Equivalents	$ 0	$ 0

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SETTLEMENT AGREEMENT (Details)	3 Months Ended
	Jul. 31, 2020 USD ($)
Palm Coast, Florida
Rental income	$ 350,000
Settlement Agreement [Member]
Amount of settlement received	$ 650,000

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INVESTMENT ASSETS, NET (Details) - USD ($) $ in Thousands	Jul. 31, 2020	Apr. 30, 2020
INVESTMENT ASSETS, NET
Land held for long-term investment	$ 9,775	$ 9,751
Construction in process	2,573	2,320
Warehouse and office facilities	13,095	13,096
Less accumulated depreciation	(6,645)	(6,523)
Warehouse and office facilities, net	6,450	6,573
Real Estate Investment Property, Net, Total	$ 18,798	$ 18,644

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INVESTMENT ASSETS - Additional Information (Details)	3 Months Ended
	Jul. 31, 2020 USD ($) ft² a	Jul. 31, 2019 USD ($)	Apr. 30, 2020 a
Area of Land | a	12,000		12,000
Depreciation On Warehouse And Other Facilities | $	$ 122,000	$ 122,000
Florida
Area of Land | ft²	204,000

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OTHER ASSETS (Details) - USD ($) $ in Thousands	Jul. 31, 2020	Apr. 30, 2020
OTHER ASSETS
Prepaid expenses and miscellaneous other, net	$ 959	$ 934
Other Assets	$ 959	$ 934

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OTHER ASSETS - Additional Information (Details) - USD ($)	3 Months Ended
	Jul. 31, 2020	Jul. 31, 2019
Depreciation	$ 129,000	$ 127,000
Property, Plant and Equipment
Depreciation	7,000	4,000
Right of use assets
Operating Lease, Right-of-Use Asset	$ 83,000	$ 175,000

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ACCOUNTS PAYABLE AND ACCRUED EXPENSES (Details) - USD ($) $ in Thousands	Jul. 31, 2020	Apr. 30, 2020
ACCOUNTS PAYABLE AND ACCRUED EXPENSES
Total	$ 4,105	$ 3,125
Real estate operations
ACCOUNTS PAYABLE AND ACCRUED EXPENSES
Accrued expenses	371	518
Trade payables	1,609	1,146
Real Estate customer deposits	1,143	1,117
Other	59
Total	3,182	2,781
Corporate operations
ACCOUNTS PAYABLE AND ACCRUED EXPENSES
Total	$ 923	$ 344

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NOTES PAYABLE (Details) - USD ($) $ in Thousands	Jul. 31, 2020	Apr. 30, 2020
NOTES PAYABLE:
Notes Payable	$ 5,496	$ 3,890
Real estate notes payable [Member]
NOTES PAYABLE:
Notes Payable	5,523	3,894
Unamortized debt issuance costs [Member]
NOTES PAYABLE:
Unamortized debt issuance costs	$ (27)	$ (4)

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NOTES PAYABLE: - Principal repayments (Details) $ in Thousands	Jul. 31, 2020 USD ($)
NOTES PAYABLE
2021	$ 3,094
2022	2,388
2023	41
Long-term Debt, Total	$ 5,523

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NOTES PAYABLE - Additional information (Details) - USD ($)	1 Months Ended	3 Months Ended		12 Months Ended
	Jun. 30, 2020	Jul. 31, 2020	Jul. 31, 2019	Apr. 30, 2020	Feb. 29, 2020	Jan. 31, 2020	Jun. 30, 2019	Apr. 30, 2019	Apr. 30, 2018
NOTES PAYABLE:
Outstanding amount		$ 5,523,000
Notes Payable		5,496,000		$ 3,890,000
Repayments of Notes Payable		637,000	$ 572,000
Lomas Encantadas Development Company LLC [Member]
NOTES PAYABLE:
Interest and fees capitalized			4,000
Nonrevolving Line Of Credit [Member] | Lomas Encantadas Development Company LLC [Member]
NOTES PAYABLE:
Maximum borrowing capacity							$ 2,475,000		$ 4,750,000
Outstanding amount		1,005,000		1,576,000
Principal repayments		$ 637,000	182,000	675,000
Interest rate		3.20%
Interest and fees capitalized		$ 12,000	29,000
Book value of real estate property collateralized		3,044,000
Nonrevolving Line Of Credit [Member] | Las Fuentes Village II, LLC [Member]
NOTES PAYABLE:
Maximum borrowing capacity						$ 2,750,000
Outstanding amount		$ 2,312,000
Interest rate		3.08%
Interest and fees capitalized		$ 16,000
Book value of real estate property collateralized		2,870,000
Nonrevolving Line Of Credit [Member] | Hawksite 27 Development Company LLC [Member]
NOTES PAYABLE:
Maximum borrowing capacity								$ 1,800,000
Outstanding amount			813,000
Principal repayments			390,000
Interest and fees capitalized			$ 20,000
Revolving Credit Facility [Member] | Mountain Hawk East Development Company LLC [Member]
NOTES PAYABLE:
Maximum borrowing capacity					$ 3,000,000
Outstanding amount		41,000
Principal repayments		$ 0		0
Interest rate		4.50%
Interest and fees capitalized		$ 1,000
Book value of real estate property collateralized		$ 1,760,000
Small Business Administration, Paycheck Protection Program, CARES Act [Member]
NOTES PAYABLE:
Maximum borrowing capacity				$ 298,000
Interest rate		1.00%
Proceeds from debt		$ 298,000
Interest and fees capitalized		0
Acquisition Financing Member
NOTES PAYABLE:
Deferred purchase price	$ 1,838,000
Book value of real estate property collateralized		3,530,000
Acquisition Financing Member | On or before June 2021
NOTES PAYABLE:
Interest and fees capitalized	919,000
Acquisition Financing Member | On or before June 2022
NOTES PAYABLE:
Interest and fees capitalized	919,000
Development Financing Member
NOTES PAYABLE:
Maximum borrowing capacity	$ 3,750,000
Outstanding amount		27,000
Principal repayments		$ 0
Interest rate		3.75%
Interest and fees capitalized		$ 1,000
Book value of real estate property collateralized		$ 3,530,000

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REVENUES - Additional Information (Details) - customer	3 Months Ended
	Jul. 31, 2020	Jul. 31, 2019
REVENUES:
Percentage of real estate land sales	100.00%	100.00%
Number of customers	4	5

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OTHER REVENUES (Details) - USD ($) $ in Thousands	3 Months Ended
	Jul. 31, 2020	Jul. 31, 2019
OTHER REVENUES
Oil & gas royalties	$ 11
Private infrastructure reimbursement covenants	133	$ 91
Public improvement district reimbursements	175
Miscellaneous other revenue	50	44
Other Revenue, Net	$ 369	$ 135

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BENEFIT PLANS (Details) - USD ($)	3 Months Ended
	Jul. 31, 2020	Jul. 31, 2019
Defined Benefit Plan Disclosure [Line Items]
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent	$ 90,000	$ 154,000
Share-based Compensation, Total	40,000	48,000
Non employee Individual of Board of Directors [Member]
Defined Benefit Plan Disclosure [Line Items]
Deferred Compensation Arrangement with Individual, Allocated Share-based Compensation Expense	$ 22,000	$ 23,000
Equity Plan [Member]
Defined Benefit Plan Disclosure [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period	9,500	10,000
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number	32,334	41,667
Two Thousand Six Equity Plan [Member]
Defined Benefit Plan Disclosure [Line Items]
Stock Issued During Period, Shares, Restricted Stock Award, Gross	9,000	9,000
Restricted Stock [Member]
Defined Benefit Plan Disclosure [Line Items]
Share-based Compensation, Total	$ 18,000	$ 25,000
Restricted Stock [Member] | Equity Plan [Member]
Defined Benefit Plan Disclosure [Line Items]
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Total	$ 94,000	$ 164,000
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period	3 years

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INTEREST INCOME,NET (Details) - USD ($) $ in Thousands	3 Months Ended
	Jul. 31, 2020	Jul. 31, 2019
INTEREST INCOME, NET
Interest income on savings	$ 6	$ 60
Interest on deferred purchase price	0	64
Interest income, net	$ 6	$ 124

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OTHER INCOME - Additional Information (Details) - USD ($) $ in Thousands	3 Months Ended
	Jul. 31, 2020	Jul. 31, 2019
OTHER INCOME
Other Nonoperating Income	$ 650	$ 0

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SUBSEQUENT EVENTS (Details) - Subsequent Event [Member]	1 Months Ended
	Aug. 31, 2020 $ / shares shares
Subsequent Event [Line Items]
Number of shares repurchased | shares	11,847
Repurchase price per share | $ / shares	$ 4.48