AMREP(AXR) - 2025 Q3 - Quarterly Report

PART I. FINANCIAL INFORMATION This section presents AMREP Corporation's unaudited financial statements, notes, and management's discussion and analysis of financial condition and results of operations Item 1. Financial Statements AMREP Corporation's unaudited financial statements reflect significant increases in assets, net income, and operating cash flow for the period Condensed Consolidated Balance Sheets Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | Jan 31, 2025 (Unaudited) | Apr 30, 2024 | | :--- | :--- | :--- | | Assets | | | | Cash and cash equivalents | $36,936 | $29,694 | | Real estate inventory | $65,102 | $65,983 | | Total Assets | $128,938 | $122,830 | | Liabilities & Equity | | | | Total Liabilities | $2,962 | $4,780 | | Total Shareholders' Equity | $125,976 | $118,050 | | Total Liabilities and Shareholders' Equity | $128,938 | $122,830 | Condensed Consolidated Statements of Operations Statement of Operations Summary (Unaudited, in thousands) | Metric | Three Months Ended Jan 31, 2025 | Three Months Ended Jan 31, 2024 | Nine Months Ended Jan 31, 2025 | Nine Months Ended Jan 31, 2024 | | :--- | :--- | :--- | :--- | :--- | | Total Revenues | $7,520 | $12,689 | $38,516 | $31,833 | | Operating Income | $432 | $(148) | $8,568 | $2,926 | | Net Income | $717 | $92 | $8,823 | $2,546 | | Diluted EPS | $0.13 | $0.02 | $1.64 | $0.48 | Condensed Consolidated Statements of Comprehensive Income - For the nine months ended January 31, 2025, total comprehensive income was $7.6 million, compared to $2.5 million in the prior-year period. The current period includes a $1.23 million reclassification from accumulated other comprehensive income to a benefit for income taxes related to the termination of the pension plan[13][48] Condensed Consolidated Statements of Shareholders' Equity - Total shareholders' equity increased from $118.1 million on May 1, 2024, to $126.0 million on January 31, 2025. The increase was primarily driven by net income of $8.8 million, partially offset by a reclassification of accumulated other comprehensive income of $1.23 million[16] Condensed Consolidated Statements of Cash Flows Cash Flow Summary (Unaudited, in thousands) | Cash Flow Activity | Nine Months Ended Jan 31, 2025 | Nine Months Ended Jan 31, 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $7,273 | $3,381 | | Net cash used in investing activities | $(116) | $(5,354) | | Net cash used in financing activities | $(7) | $(7) | | Increase (decrease) in cash | $7,150 | $(1,980) | Notes to Condensed Consolidated Financial Statements - The company's primary business segments are land development and homebuilding. All sales are domestic[21] - For the nine months ended January 31, 2025, two customers each accounted for over 10% of total revenues, contributing $6.028 million and $6.036 million respectively, both within the land development segment[40] Warranty Reserve Activity (in thousands) | Period | Beginning Balance | Warranty Issued | Expenditures | Ending Balance | | :--- | :--- | :--- | :--- | :--- | | Nine Months Ended Jan 31, 2025 | $175 | $91 | $(17) | $249 | | Nine Months Ended Jan 31, 2024 | $165 | $48 | $(8) | $139 | Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Management reported a significant increase in net income for the nine months ended January 31, 2025, to $8.8 million from $2.5 million year-over-year, driven by a 93% surge in home sale revenues. The company is facing market headwinds, including municipal delays and housing affordability challenges, leading to strategic shifts like leasing completed homes and slowing new projects. Liquidity remains strong, with cash and equivalents increasing to $37.4 million, supported by positive operating cash flow Results of Operations Net Income and EPS Comparison | Period | Net Income | Diluted EPS | | :--- | :--- | :--- | | Nine Months Ended Jan 31, 2025 | $8,823,000 | $1.64 | | Nine Months Ended Jan 31, 2024 | $2,546,000 | $0.48 | - The company experienced material delays in municipal entitlements, infrastructure, and approvals, which delayed revenue realization and increased costs. Housing affordability challenges due to high prices and interest rates have negatively affected demand[67] Revenue by Category (Nine Months Ended Jan 31, in thousands) | Revenue Category | 2025 | 2024 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Land sale revenues | $18,113 | $15,576 | $2,537 | 16% | | Home sale revenues | $18,420 | $9,527 | $8,893 | 93% | | Other revenues | $1,983 | $6,730 | $(4,747) | (71)% | | Total | $38,516 | $31,833 | $6,683 | 21% | - Home sale gross margins decreased to 20% for the nine months ended January 31, 2025, from 27% in the prior year, primarily due to the mix of homes sold and increased costs for materials and labor[79] Liquidity and Capital Resources Cash, Cash Equivalents and Restricted Cash (in thousands) | Date | Amount | | :--- | :--- | | January 31, 2025 | $37,391 | | April 30, 2024 | $30,241 | - Net cash from operating activities for the nine months ended January 31, 2025, was $7.3 million, a significant increase from $3.4 million in the prior year. This was primarily due to cash from business operations and a reduction in real estate inventory[86] - Real estate inventory decreased slightly to $65.1 million as of January 31, 2025, from $66.0 million at April 30, 2024. Investment assets increased by 16% to $14.5 million, partly due to opportunistically leasing completed homes[91][92] Item 4. Controls and Procedures Management, including the CEO and Vice President of Finance and Accounting, evaluated the company's disclosure controls and procedures and concluded they were effective as of January 31, 2025. There were no material changes to the company's internal control over financial reporting during the most recent fiscal quarter - The Company's Chief Executive Officer and Vice President, Finance and Accounting concluded that disclosure controls and procedures were effective as of January 31, 2025[98] - No material changes in the Company's internal control over financial reporting occurred during the most recent fiscal quarter[99] PART II. OTHER INFORMATION This section covers other information, including details on trading arrangements and a list of exhibits filed with the report Item 5. Other Information During the third fiscal quarter ended January 31, 2025, no director or officer of the company adopted or terminated a Rule 10b5-1 trading arrangement or a non-Rule 10b5-1 trading arrangement - No director or officer adopted or terminated a "Rule 10b5-1 trading arrangement" or "non-Rule 10b5-1 trading arrangement" during the three months ended January 31, 2025[102] Item 6. Exhibits This section lists the exhibits filed with the Form 10-Q, including certifications required by the Securities Exchange Act of 1934 and Inline XBRL documents - The report includes required certifications under Rule 13a-14(a) and 18 U.S.C. Section 1350, as well as Inline XBRL Instance Documents[103][107]