AMREP(AXR) - 2022 Q1 - Quarterly Report

Financial Performance - For the three months ended July 31, 2021, the Company reported net income of $1,637,000, or $0.22 per diluted share, compared to $593,000, or $0.07 per diluted share for the same period in 2020, representing a significant increase in profitability [56]. - Total revenues for the three months ended July 31, 2021 were $10,507,000, a 150% increase from $4,206,000 in the same period of 2020, driven by higher land and home sale revenues [57]. - The provision for income taxes increased to $389,000 for the three months ended July 31, 2021, compared to $146,000 for the same period in 2020, reflecting higher income levels [69]. Revenue Breakdown - Land sale revenues increased by $3,703,000 to $7,190,000 for the three months ended July 31, 2021, primarily due to increased demand for lots by builders [58]. - Home sale revenues were $2,411,000 for the three months ended July 31, 2021, as the Company completed its first home sales, closing on 8 homes at an average selling price of $301,000 [60]. Cost and Expenses - The average gross profit percentage on land sales was 22% for the three months ended July 31, 2021, down from 23% in the same period of 2020, due to the location and mix of lots sold [65]. - Home sale cost of revenues for the three months ended July 31, 2021 was $1,914,000, reflecting the Company's entry into home sales [66]. - General and administrative expenses decreased by 18% to $1,188,000 for the three months ended July 31, 2021, compared to $1,444,000 in the same period of 2020 [67]. Inventory and Assets - Real estate inventory increased by 10% from $55,589,000 on April 30, 2021 to $61,298,000 on July 31, 2021, indicating growth in land development activity [74]. - Land inventory in New Mexico increased by 11% from $49,918,000 to $55,640,000 [75]. - Homebuilding finished inventory decreased by 49% from 417 units to 214 units [75]. - Homebuilding construction in process increased by 13% from 1,279 units to 1,447 units [75]. - Other assets increased by $146,000 primarily due to an increase in prepaid stock compensation [77]. Liabilities and Financing - Accounts payable and accrued expenses decreased by $758,000 due to payment of accounts payable and a reduction in customer deposits [77]. - Notes payable, net increased from $3,448,000 to $6,377,000, primarily due to additional borrowings for land acquisition [79]. Capital Expenditures and Future Outlook - Capital expenditures were less than $1,000 for the three months ended July 31, 2021, primarily for technology upgrades [80]. - The company anticipates future development of its real estate holdings and expects to finance its working capital needs [82]. - The company recorded other comprehensive income of $66,000 for the three months ended July 31, 2021, reflecting changes in accrued pension costs [78]. - Deferred income taxes, net decreased by $488,000 due to a reduction in federal net operating loss carry forwards [77]. Acquisitions - The Company acquired a 7,000 square foot office building in Rio Rancho, New Mexico in August 2021 to support its real estate business operations [73].