AXR US Equity☆

Item 1A.Risk Factors

As a smaller reporting company, the Company has elected not to provide the disclosure under this item.

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Item 1B.Unresolved Staff Comments

Not applicable.

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Item 2.Properties

The executive offices of the Company are located in approximately 1,400 square feet of leased space in an office building in Havertown, Pennsylvania. The offices of the Company’s real estate business are located in approximately 5,400 square feet of space in a 7,000

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square foot office building in Rio Rancho owned by the Company. In addition, real estate inventory and investment properties are described in Item 1 of Part I of this annual report on Form 10-K with certain mortgages associated with such real estate described in Item 7 of Part II of this annual report on Form 10-K. The Company believes its facilities are adequate for its current requirements.

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Item 3.Legal Proceedings

The Company and its subsidiaries are involved in various pending or threatened claims and legal actions arising in the ordinary course of business. While the ultimate results of these other matters cannot be predicted with certainty, management believes that they will not have a material adverse effect on the Company’s consolidated financial position, liquidity or results of operations.

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Item 4.Mine Safety Disclosures

Not applicable.

Information about the Company’s Executive Officers

Set forth below is certain information concerning persons who are the current executive officers of the Company.

Christopher V. Vitale, age 46, has been a director of the Company since 2021 and has been President and Chief Executive Officer of the Company since September 2017. From 2014 to September 2017, Mr. Vitale was Executive Vice President, Chief Administrative Officer and General Counsel of the Company and, from 2013 to 2014, he was Vice President and General Counsel of the Company. Prior to joining the Company, Mr. Vitale held various legal positions at Franklin Square Holdings, L.P., a national sponsor and distributor of investment products, from 2011 to 2013 and at WorldGate Communications, Inc., a provider of digital voice and video phone services and video phones, from 2009 to 2011. Prior to joining WorldGate, Mr. Vitale was an attorney with the law firms of Morgan, Lewis & Bockius LLP and Sullivan & Cromwell LLP.

Adrienne M. Uleau, age 54, has been Vice President, Finance and Accounting of the Company since March 2020. From August 2018 to March 2020, Ms. Uleau was Controller of the Company. Prior to joining the Company, Ms. Uleau had been Controller of United Tectonics Corp., a construction services company, from 2016 to August 2018. From 2014 to 2016, Ms. Uleau was Financial Manager of Cushman and Wakefield. Prior to 2014, Ms. Uleau held various accounting positions. In 2012, Ms. Uleau declared bankruptcy in connection with unsecured credit card debt.

The executive officers are elected or appointed by the board of directors of the Company or its appropriate subsidiary to serve until the appointment or election and qualification of their successors or their earlier death, resignation or removal.

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PART II

Item 5.Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

The Company’s common stock is traded on the New York Stock Exchange under the symbol “AXR”. On July 18, 2022, there were 264 holders of record of the common stock.

The Company’s common stock is often thinly traded. As a result, large transactions in the Company’s common stock may be difficult to execute in a short time frame and may cause significant fluctuations in the price of the Company’s common stock. Among other reasons, the stock is thinly traded due to the fact that four of the Company’s shareholders beneficially owned approximately 54% of the outstanding common stock as of July 18, 2022 according to available information. The average trading volume in the Company’s common stock on the New York Stock Exchange over the thirty-day trading period ending on April 30, 2022 was 11,596 shares per day.

The Company is an Oklahoma corporation and the anti-takeover provisions of its certificate of incorporation and of Oklahoma law generally prohibit the Company from engaging in “business combinations” with an “interested shareholder,” as those terms are defined therein, unless the holders of at least two-thirds of the Company’s then outstanding common stock approve the transaction. Consequently, the concurrence of the Company’s largest shareholders would generally be needed for any “interested shareholder” to acquire control of the Company, even if a change in control would be beneficial to the Company’s other shareholders.

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Equity Compensation Plan Information

See Item 12, which incorporates such information by reference from the Company’s Proxy Statement for its 2022 Annual Meeting of Shareholders to be filed with the Securities and Exchange Commission.

Dividend Policy

The Company has paid no cash dividends on its common stock since fiscal year 2008. The Company may consider dividends from time-to-time in the future in light of conditions then existing, including earnings, financial condition, cash position, capital requirements and other needs. No assurance is given that there will be any such future dividends declared.

Share Repurchases

Refer to Note 15 to the consolidated financial statements contained in this annual report on Form 10-K for detail regarding the Company’s share repurchase activity. The following table sets forth all purchases made by or on behalf of the Company or any “affiliated purchaser” as defined in Rule 10b-18(a)(3) under the Exchange Act, of shares of common stock of the Company during each month within the three months ended April 30, 2022:

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​ ​ Total ​ Average ​ Total Number of Shares ​ Maximum Number of

​ Number of Price Purchased as Part of Shares that May Yet Be

​ Shares Paid Per Publicly Announced Purchased Under the Plans

Period Purchased Share Plans or Programs or Programs (1)

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(1) In March 2022, the Company repurchased 2,096,061 shares of common stock of the Company at a price of $10.45 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. The share repurchase was not completed pursuant to a publicly announced share repurchase program of the Company.

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Item 6.[Reserved]

Item 7.Management’s Discussion and Analysis of Financial Condition and Results of Operations

For a description of the Company’s business, refer to Item 1 of Part I of this annual report on Form 10-K. As indicated in Item 1, the Company, through its subsidiaries, is primarily engaged in two business segments: land development and homebuilding. The Company has no foreign sales. 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 discussion should be read in conjunction with the consolidated financial statements and accompanying notes.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

The Company prepares its financial statements in conformity with accounting principles generally accepted in the United States of America. The Company discloses its significant accounting policies in the notes to its audited consolidated financial statements.

The preparation of such financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the dates of those financial statements as well as the amounts reported in the financial statements and accompanying notes. Areas that require significant judgments and estimates to be made include: (1) land sale cost of revenues calculations, which are based on land development budgets and estimates of costs to complete; (2) cash flows, asset groupings and valuation assumptions in performing asset impairment tests of long-lived assets and assets held for sale; (3) actuarially determined defined benefit pension obligations and other pension plan accounting and disclosures; (4) risk assessment of uncertain tax positions; and (5) the determination of the recoverability of net deferred tax assets. Actual results could differ from those estimates.

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There are numerous critical assumptions that may influence accounting estimates in these and other areas. Management bases its critical assumptions on historical experience, third-party data and various other estimates that it believes to be reasonable under the circumstances. The most critical assumptions made in arriving at these accounting estimates include the following:

RESULTS OF OPERATIONS

Year Ended April 30, 2022 Compared to Year Ended April 30, 2021

For 2022, the Company had net income of $15,862,000, or $2.21 per diluted share, compared to net income of $7,392,000, or $0.95 per diluted share, in 2021.

Revenues. The following presents information on revenues for the Company’s operations (dollars in thousands):

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​ Year Ended April 30, % Increase

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(a) Percentage not meaningful.

During 2022, the Company experienced supply chain constraints, increases in the prices of building materials, shortages of skilled labor and delays in municipal approvals and inspections in both the land development business segment and homebuilding business segment, which have caused delays in construction and the realization of revenues and increases in cost of revenues. Future economic conditions and the demand for land and homes are subject to continued uncertainty due to many factors, including the recent increase in mortgage interest rates, higher inflation, low supplies of new and existing home inventory, ongoing disruptions from supply chain challenges and labor shortages, the ongoing impact of the COVID-19 pandemic and government directives, and other factors. While construction and land costs remain elevated, the Company has been able to offset these cost increases through land and home price increases in 2022 due to the strong pricing environment. The Company’s past performance may not be indicative of future results.

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​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

​ ​ ​ ​ ​ ​ ​ Revenue ​ ​ ​ ​ ​ ​ Revenue

​ Acres Sold Revenue Per Acre1 Acres Sold Revenue Per Acre1

Developed ​ ​ ​ ​ ​

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The increase in the average selling price per acre of developed residential land in 2022 compared to 2021 was primarily due to the location and mix of property sold and increased demand for lots by builders. The increase in the average selling price per acre of developed commercial land in 2022 compared to 2021 was primarily due to the location and mix of property sold. The increase in the average selling price per acre of undeveloped land in 2022 compared to 2021 was primarily due to the location and mix of property sold and increased demand in the market. The Company sold 1,196 acres of contiguous undeveloped land in Sandoval County, New Mexico in 2022, representing $7,107,000 of revenue, to one purchaser. The Company does not expect the sale of a significant amount of undeveloped land in 2022 to be indicative of the sale of such undeveloped land in the future.

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​ ​ Year Ended April 30,

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As of April 30, 2022, the Company had 38 homes in production, including 17 homes under contract, which homes under contract represented $8,713,000 of expected sale revenues when closed, subject to customer cancellations and change orders. As of April 30, 2021, the Company had 33 homes in production, including 23 homes under contract, which homes under contract represented $6,567,000 of expected sale revenues when closed, subject to customer cancellations and change orders.

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​ ​ Year Ended April 30,

Sales of buildings and other land ​ $ 8,439 ​ $ 9,493

Oil and gas royalties ​ 276 ​ 135

Infrastructure reimbursements ​ 1,189 ​ 1,228

Miscellaneous other revenues ​ 446 ​ 959

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Sales of buildings and other land during 2022 consisted of revenues from the sale of a 4,338 square foot, single tenant retail building in the La Mirada subdivision and from the sale of a 143,000 square foot warehouse and office facility located in Palm Coast, Florida. Sales of buildings and other land during 2021 consisted of revenues from the sale of a 14,000 square foot, single tenant retail building in the Las Fuentes at Panorama Village subdivision in Rio Rancho and from the sale of a 61,000 square foot warehouse and office facility located in Palm Coast, Florida. The Company does not expect the sale of the warehouse and office facilities located in Palm Coast, Florida to be indicative of future sales of such properties since the Company has no other similar properties.

Refer to Note 7 to the consolidated financial statements contained in this annual report on Form 10-K for detail about the categories of building sales and other revenues.

1Revenues per lot may not calculate precisely due to the rounding of revenues to the nearest thousand dollars.

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Cost of Revenues. The following presents information on cost of revenues for the Company’s operations (dollars in thousands):

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​ ​ Year Ended April 30, ​ % Increase

Home sale cost of revenues ​ 10,237 ​ 2,584 (a) ​

Building sales and other cost of revenues ​ 4,387 ​ 5,722 (23) %

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(a) Percentage not meaningful.

General and Administrative Expenses. The following presents information on general and administrative expenses for the Company’s operations (dollars in thousands):

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​ ​ Year Ended April 30, ​ % Increase

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Interest Income (Expense). Interest income (expense), net increased to $2,000 for 2022 from $(40,000) for 2021. Interest and loan costs of $224,000 and $105,000 were capitalized in real estate inventory for the years ending April 30, 2022 and April 30, 2021.

Other Income. Other income of $261,000 for 2022 primarily consisted of $185,000 received in connection with the bankruptcy of a warranty provider, $45,000 of debt forgiveness with respect to a note payable and $30,000 earned from a life insurance policy for a retired executive of the Company. Other income of $1,028,000 for 2021 primarily consisted of a settlement payment of $650,000 from a tenant for failure to pay rent for the Company’s warehouse and office facilities located in Palm Coast, Florida and $300,000 of debt forgiveness with respect to a loan received by the Company pursuant to the Paycheck Protection Program administered by the U.S. Small Business Administration.

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Income Taxes. The Company had a provision for income taxes of $5,704,000 for 2022 compared to a provision for income taxes of $2,643,000 for 2021. The provision for income taxes correlated to the amount of income before income taxes during each year.

LIQUIDITY AND CAPITAL RESOURCES

AMREP Corporation is a holding company that conducts substantially all of its operations through subsidiaries. As a holding company, AMREP Corporation is dependent on its available cash and on cash from subsidiaries to pay expenses and fund operations. 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.

The Company’s primary sources of funding for working capital requirements are cash flow from operations, bank financing for specific real estate projects, a revolving line of credit and existing cash balances. Land and homebuilding properties generally cannot be sold quickly, and the ability of the Company to sell properties has been and will continue to be affected by market conditions. The ability of the Company to generate cash flow from operations is primarily dependent upon its ability to sell the properties it has selected for disposition at the prices and within the timeframes the Company has established for each property. The development of additional lots for sale, construction of homes or pursuing other real estate projects will require financing or other sources of funding, which may not be available on acceptable terms (or at all). If the Company is unable to obtain such financing, the Company’s results of operations could be adversely affected.

The Company expects the primary demand for funds in the short-term and long-term future will be for the development and acquisition of land, construction of home and commercial projects and general and administrative expenses. The development and acquisition of land and construction of home and commercial projects is generally required to satisfy delivery obligations of developed land or finished homes to customers. Further, the Company regularly evaluates property available for purchase from third parties for possible acquisition and development by the Company. To the extent the sources of capital described above are insufficient to meet its needs, the Company may conduct public or private offerings of securities, dispose of certain assets or draw on existing or new debt facilities. The Company believes that it has adequate cash, bank financing and cash flows from operations to provide for its anticipated spending in fiscal year 2023.

COVID-19 Impact and Response.In March 2020, the World Health Organization declared the novel strain of coronavirus (COVID-19) a global pandemic and recommended containment and mitigation measures worldwide. Subsequently, extraordinary and wide-ranging actions were taken by public health and governmental authorities to contain and combat the outbreak and spread of COVID-19, including quarantines, shelter-in-place orders and similar mandates for many individuals to substantially restrict daily activities and for many businesses to curtail or cease normal operations.

The Company’s construction operations have continued functioning during this period subject to health and safety protocols in order to protect the Company’s employees, trade contractors and homebuilder customers. Those restrictions, combined with a reduction in the availability, capacity and efficiency of municipal and private services necessary to progress land development and homebuilding, have reduced the Company’s sales pace and delayed certain projects and deliveries. The inconsistent and unpredictable impacts of the COVID-19 virus and related variants, including changing governmental directives, public health challenges and progress, macroeconomic consequences and market reactions thereto, may cause the Company to adjust its planning and operations and makes it more challenging for the Company to estimate the future performance of the business and develop strategies to generate growth. Despite the development of vaccines and more effective treatments for the physical impacts of COVID-19, there are no reliable estimates of how long the COVID-19 pandemic, or its related impacts on overall economic conditions or the global supply chain, will last. As a result, the unpredictability of the current economic and public health conditions will continue to evolve. While the Company cannot reasonably estimate the length or severity of this pandemic or if there will be additional periods of increases or spikes in the number of COVID-19 cases, future mutations or related strains of the virus in areas in which the Company operates, the cumulative effect of the COVID-19 pandemic on the global supply chain and the Company’s operations could materially impact the Company’s financial position, results of operations and cash flows.

The Company could also be negatively impacted if disruptions related to COVID-19 (a) decrease consumer confidence generally or with respect to purchasing a home or cause civil unrest, (b) precipitate a prolonged economic downturn or an extended rise in unemployment or tempering of wage growth, any of which could lower demand for the Company’s products, impair the Company’s ability to sell and build finished lots and homes in a typical manner or at all, impair the Company’s ability to generate revenues and cash flows, or impair the Company’s ability to access the capital or lending markets (or significantly increase the costs of doing so), (c) increase the costs or decrease the supply of construction materials or the availability of subcontractors and other talent, including as a result of infections or medically necessary or recommended self-quarantining, or governmental mandates to direct production activities to support public health efforts or (d) result in the Company recognizing charges in future periods, which may be material, for impairments related to the Company’s inventory or investment assets. Any epidemic, pandemic or similar serious public health issue, and the measures undertaken by governmental authorities to address it, could significantly disrupt or prevent the Company from

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operating in the ordinary course for an extended period and could have a significant adverse impact on the Company’s financial statements.

Should the adverse impacts described above (or others that are currently unknown) occur, whether individually or collectively, the Company would expect to experience, among other things, increases in defaults under customer contracts, and decreases in future demand for finished lots and homes, likely resulting in reduced revenues and profitability. Such impacts could be material to the Company’s financial statements. The Company could also be forced to reduce its average selling prices in order to generate homebuilder or homebuyer demand or in reaction to competitive pressures. In addition, should the COVID-19 public health effort intensify to such an extent that the Company cannot operate in Rio Rancho, the Company could generate few or no sales during the applicable period, which could be prolonged. If there are prolonged government restrictions on the Company’s operations or the Company’s employees, trade contractors or customers, or an extended economic recession, the Company could be unable to produce revenues and cash flows sufficient to conduct operations, meet the terms of the Company’s covenants and other requirements under its financing arrangements or service the Company’s outstanding debt. Such a circumstance could, among other things, exhaust the Company’s available liquidity (and ability to access liquidity sources) or trigger an acceleration to pay a significant portion or all of the Company’s then-outstanding debt obligations, which the Company may be unable to do.

Pension Plan. The Company has a defined benefit pension plan for which accumulated benefits were frozen and future service credits were curtailed as of March 1, 2004. Under generally accepted accounting principles, the Company’s defined benefit pension plan was overfunded as of April 30, 2022 by $90,000, with $18,054,000 of assets and $17,964,000 of liabilities, and was underfunded as of April 30, 2021 by $476,000, with $21,102,000 of assets and $21,578,000 of liabilities. The pension plan liabilities were determined using a weighted average discount interest rate of 3.97% per year as of April 30, 2022 and 2.48% per year as of April 30, 2021, which are based on the FTSE Pension Discount Curve as of such dates as it corresponds to the projected liability requirements of the pension plan. As of April 30, 2022, for each 0.25% increase in the weighted average discount interest rate, the pension plan liabilities are forecasted to decrease by $337,000 and for each 0.25% decrease in the weighted average discount interest rate, the pension plan liabilities are forecasted to increase by $350,000. As of April 30, 2022, the effect of every 0.25% change in the investment rate of return on pension plan assets would increase or decrease the subsequent year’s pension expense by $42,000, and the effect of every 0.25% change in the weighted average discount interest rate would increase or decrease the subsequent year’s pension expense by $7,000. The pension plan is subject to minimum IRS contribution requirements, but these requirements can be satisfied by the use of the pension plan’s existing credit balance. No cash contributions were required during 2022. The Company made voluntary contributions to the pension plan of $1,847,000 during 2021.

Cash Flow. The following presents information on the cash flows for the Company (dollars in thousands):

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​ ​ Year Ended April 30, ​ % Increase

Net cash provided by operating activities ​ $ 15,476 ​ $ 12,609 23 %

Net cash used in investing activities ​ (1,195) ​ (5) (a) ​

Net cash used in financing activities ​ (23,361) ​ (5,305) (a) ​

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(a)Percentage not meaningful.

Operating Activities. Net cash provided by operating activities for 2022 was higher than 2021 by $2,867,000 primarily due to (i) an increase in the Company’s net income, accounts payable and accrued expenses and taxes payable and (ii) a decrease in the amount of investment assets and pension costs, partially offset by (a) a decrease in the amount of deferred income taxes and (b) an increase in the amount of real estate inventory.

Investing Activities. Net cash used in investing activities for 2022 was higher than 2021 by $1,190,000 primarily due to the acquisition of a 7,000 square foot office building in Rio Rancho from which the Company’s real estate business now operates.

Financing Activities. Net cash used in financing activities for 2022 was higher than 2021 by $18,056,000 primarily due to the Company’s share repurchase activity. Notes payable, net decreased from $3,448,000 as of April 30, 2021 to $2,030,000 as of April 30, 2022, primarily due to repayments made on outstanding borrowings partially offset by additional borrowings to fund land acquisitions and land development activities. Refer to Note 6 to the consolidated financial statements contained in this annual report on Form 10-K for detail regarding each of the Company’s notes payable. Refer to Note 15 to the consolidated financial statements contained in this annual report on Form 10-K for detail regarding the Company’s share repurchase activity. The Company does not expect the Company’s share repurchase activity to be indicative of its future activity in this area.

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Asset and Liability Levels. The following presents information on certain asset and liability levels (dollars in thousands):

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​ ​ April 30, ​ % Increase

Deferred income taxes, net ​ 958 ​ 2,749 (a) ​

Accounts payable and accrued expenses ​ 6,077 ​ 4,458 36 %

Taxes payable, net ​ 3,648 ​ 95 (a) ​

Prepaid (accrued) pension costs ​ 90 ​ (476) (a) ​

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(a) Percentage not meaningful.

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​ ​ April 30, ​ % Increase

Homebuilding finished inventory ​ 1,135 ​ 417 (a) ​

Homebuilding construction in process ​ 3,306 ​ 1,279 (a) ​

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(a) Percentage not meaningful.

Land inventory in New Mexico increased from April 30, 2021 to April 30, 2022 by $9,456,000 primarily due to increased land development activity and the acquisition of land. Homebuilding finished inventory increased from April 30, 2021 to April 30, 2022 by $718,000 primarily due to the completion of construction of model homes and homes not yet sold. Homebuilding construction in process increased from April 30, 2021 to April 30, 2022 by $2,027,000 due to increased homebuilding activity.

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​ ​ April 30, ​ % Increase

Land held for long-term investment ​ $ 9,017 ​ $ 9,775 (8) %

Buildings ​ — ​ 10,003 (a) ​

Less accumulated depreciation ​ — ​ (6,196) (a) ​

Buildings, net ​ ​ ​ 3,807 (a) ​

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(a) Percentage not meaningful.

Land held for long-term investment represents property located in areas that are not planned to be developed in the near term and that has not been offered for sale in the normal course of business. In 2022, the Company sold 1,233.5 acres of undeveloped property in Sandoval County, New Mexico categorized as land held for long-term investment. As of April 30, 2022 and April 30, 2021, the Company held approximately 11,000 and 12,000 acres of land in New Mexico classified as land held for long-term investment.

As of April 30, 2021, buildings were comprised of a 143,000 square foot warehouse and office facility located in Palm Coast, Florida. During 2022, the Company sold this warehouse and office facility. Depreciation associated with the buildings was $201,000 and $542,000 for 2022 and 2021.

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Off-Balance Sheet Arrangements. As of April 30, 2022 and April 30, 2021, the Company did not have any off-balance sheet arrangements (as defined in Item 303(a)(4)(ii) of Regulation S-K).

Recent Accounting Pronouncements. Refer to Note 1 to the consolidated financial statements contained in this annual report on Form 10-K for a discussion of recently issued accounting pronouncements.

IMPACT OF INFLATION

The Company’s operations can be impacted by inflation. Inflation can cause increases in the cost of land, materials, services, interest rates and labor. Unless such increased costs are recovered through increased sales prices or improved operating efficiencies, operating margins will decrease. The Company’s homebuilding segment as well as homebuilders that are customers of the Company’s land development business segment face inflationary concerns that rising housing costs, including interest costs, may substantially outpace increases in the incomes of potential purchasers and make it difficult for them to purchase a new home or sell an owned home. If this situation were to exist, the demand for homes produced by the Company’s homebuilding segment could decrease and the demand for the Company’s land by homebuilder customers could decrease. Although the rate of inflation has been historically low in recent years, it has increased significantly in 2022 and the Company is currently experiencing historically significant increases in the prices of labor and certain materials as a result of this increase as well as the COVID-19 pandemic and increased demand for new homes. Inflation may also increase the Company’s financing costs. While the Company attempts to pass on to its customers increases in costs through increased sales prices, market forces may limit the Company’s ability to do so. If the Company is unable to raise sales prices enough to compensate for higher costs, or if mortgage interest rates increase significantly, the Company’s revenues, gross margins and net income could be adversely affected.

OTHER

In November 2021, the Company entered into an employment agreement with Christopher V. Vitale. Mr. Vitale is the President and Chief Executive Officer of the Company. Pursuant to the employment agreement,

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In November 2021, the Company granted Mr. Vitale an option to purchase 50,000 shares of common stock of the Company under the AMREP Corporation 2016 Equity Compensation Plan. Refer to Note 11 to the consolidated financial statements contained in this annual report on Form 10-K for additional detail about this option.

FORWARD-LOOKING STATEMENTS

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 annual report on Form 10-K 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 annual report on Form 10-K or, in the case of any document incorporated by reference, the date of that

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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.

The forward-looking statements contained in this annual report on Form 10-K include, but are not limited to, statements regarding (1) the Company’s ability to finance its future working capital, land development, homebuilding and capital expenditure needs, (2) the Company’s expected liquidity sources, including the amount of principal available for borrowing under the Company’s financing arrangements, (3) anticipated future development of the Company’s real estate holdings, (4) the development and construction of possible future commercial properties to be marketed to tenants, (5) the designs, pricing and levels of options and amenities with respect to the Company’s homebuilding operations, (6) the timing of reimbursements under, and the general effectiveness of, the Company’s public improvement districts and private infrastructure reimbursement covenants, (7) the number of planned residential lots in the Company’s subdivisions, (8) the sale of a significant amount of undeveloped land in 2022 and the sale of the warehouse and office facilities located in Palm Coast, Florida not being indicative of future operating results and the Company’s share repurchase activity not being indicative of future financing activities, (9) estimates and assumptions used in determining future cash flows of real estate projects, (10) the availability of bank financing for projects and the utilization of existing bank financing, (11) the backlog of homes under contract and in production and the dollar amount of expected sale revenues when such homes are closed, (12) the effect of recent accounting pronouncements, (13) contributions by the Company to the pension plan, the amount of future annual benefit payments to pension plan participants payable from plan assets, the investment mix between equity securities and fixed income securities seeks to achieve a desired return in the pension plan, the appropriateness of valuation methods to determine the fair value of financial instruments in the pension plan, the expected return on assets in the pension plan, the expected long-term rate of return on assets in the pension plan, the effect of changes in the weighted average discount interest rate on the amount of pension plan liabilities and the effect of changes in the investment rate of return on pension plan assets with respect to pension expense, (14) the timing of recognizing unrecognized compensation expense related to shares of common stock issued under the AMREP Corporation 2016 Equity Compensation Plan, (15) the Company’s belief that its compensation package and benefits offered to employees are competitive with others in the industry, (16) the future issuance of deferred stock units to directors of the Company, (17) the future business conditions that may be experienced by the Company, (18) the dilution to earnings per share that outstanding options to purchase shares of common stock of the Company may cause in the future, (19) the adequacy of the Company’s facilities, (20) the materiality of claims and legal actions arising in the normal course of the Company’s business, (21) the state net operating losses that are not expected to be realizable, (22) the negative impact of the COVID-19 pandemic on the Company’s financial position and ability to continue operations at normal levels or at all, (23) the duration, effect and severity of the COVID-19 pandemic and (24) the measures that governmental authorities may take to address the COVID-19 pandemic which may precipitate or exacerbate one or more of the above-mentioned or other risks and significantly disrupt or prevent the Company from operating in the ordinary course for an extended period of time. 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.

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Item 7A.Quantitative and Qualitative Disclosures About Market Risk

Not required.

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Item 8.Financial Statements and Supplementary Data

Management’s Annual Report on Internal Control Over Financial Reporting

Management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934, as amended. Internal control over financial reporting is designed 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 in the United States of America.

Because of the inherent limitations of internal control over financial reporting, including the possibilities of human error and the circumvention or overriding of controls, material misstatements may not be prevented or detected on a timely basis. Accordingly, even internal controls determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. Furthermore, projections of any evaluation of the effectiveness of internal controls to future periods are subject to the risk that such controls may become inadequate due to changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Management has assessed the effectiveness of internal control over financial reporting as of April 30, 2022 based upon the criteria set forth in a report entitled “Internal Control-Integrated Framework” issued by the Committee of Sponsoring Organizations of the Treadway Commission in 2013. Based on its assessment, management has concluded that, as of April 30, 2022, internal control over financial reporting was effective.

This annual report on Form 10-K does not include an attestation report of the Company’s independent registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to such attestation pursuant to rules of the Securities and Exchange Commission that permit the Company to provide only management’s report on internal control over financial reporting in this annual report on Form 10-K.

​

​

16

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Shareholders and Board of Directors of

AMREP Corporation

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of AMREP Corporation and Subsidiaries (the “Company”) as of April 30, 2022 and 2021, the related consolidated statements of operations, comprehensive income, shareholders’ equity and cash flows for each of the two years in the period ended April 30, 2022, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of April 30, 2022 and 2021, and the results of its operations and its cash flows for each of the two years in the period ended April 30, 2022, in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the financial statements and (2) involved especially challenging, subjective, or complex judgments. The communication of a critical audit matter does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Allocation of common development costs

For the year ended April 30, 2022, the Company’s land sale cost of revenues was approximately $21.2 million, which includes all direct acquisition costs and other costs specifically identified with the land and an allocation of common development costs associated with its land development projects. As discussed in Note 1 to the consolidated financial statements, common development costs are allocated based on the estimated relative sales value of the individual parcels of land being sold to the total expected sales value for the unsold parcels of land in the applicable portion of the subdivision. At the time of the closings of the sales of individual land parcels, certain common development costs may not yet be incurred. To recognize the appropriate amount of cost of revenues, the Company estimates the total remaining common development costs associated with its land development projects. Estimates may be affected by changes to zoning laws, land development requirements and the cost of labor, material, and subcontractors.

Auditing the Company’s allocation of common development costs associated with its land development projects was complex and subject to sensitive management assumptions.

17

To test the Company’s allocation of common development costs associated with its land development projects, our audit procedures included, among others, testing the significant assumptions used to develop the estimated costs to complete the land development projects and testing the completeness and accuracy of the underlying data and allocation calculations. To test the reasonableness of the assumptions utilized in the allocation of common development costs, we compared the estimated land development costs to actual costs of similar communities developed by the Company; agreed the actual development costs to supporting documentation, including underlying contracts; tested the estimated relative selling prices by comparing to actual current selling prices; and reviewed margins disaggregated by project for reasonableness.

/s/ Marcum LLP

Marcum LLP

We have served as the Company’s auditor since 2017.

Philadelphia, Pennsylvania

July 21, 2022

​

​

18

AMREP CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

APRIL 30, 2022 AND 2021

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

​

​ ​ ​ ​ ​ ​ ​

ASSETS ​ ​ ​ ​

Deferred income taxes, net ​ 958 ​ 2,749

Prepaid pension costs ​ 90 ​ —

LIABILITIES AND SHAREHOLDERS’ EQUITY ​ ​

​ ​ ​

Liabilities: ​ ​

Accounts payable and accrued expenses ​ $ 6,077 ​ $ 4,458

Taxes payable, net ​ 3,648 ​ 95

Accrued pension costs ​ — ​ 476

​ ​ ​

Shareholders’ Equity: ​ ​

Capital contributed in excess of par value ​ 32,383 ​ 45,072

Accumulated other comprehensive loss, net ​ (4,573) ​ (4,623)

TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY ​ $ 94,917 ​ $ 97,366

​

The accompanying notes to consolidated financial statements are an

integral part of these consolidated financial statements.

​

19

AMREP CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(Amounts in thousands, except per share amounts)

​

​ ​ ​ ​ ​ ​ ​

​ ​ Year Ended April 30,

REVENUES: ​ ​

Building sales and other revenues ​ 10,350 ​ 11,815

​ ​ ​

COSTS AND EXPENSES: ​ ​

Home sale cost of revenues ​ ​ 10,237 ​ ​ 2,584

Building sales and other cost of revenues ​ 4,387 ​ 5,722

General and administrative expenses ​ 5,354 ​ 5,420

​ ​ ​ ​ ​ ​ ​

Interest income (expense), net ​ 2 ​ (40)

​ ​ ​ ​ ​ ​ ​

Provision for income taxes ​ 5,704 ​ 2,643

​ ​ ​

Basic earnings per share ​ $ 2.21 ​ $ 0.95

Diluted earnings per share ​ $ 2.21 ​ $ 0.95

Weighted average number of common shares outstanding – basic ​ 7,170 ​ 7,743

Weighted average number of common shares outstanding – diluted ​ 7,193 ​ 7,773

​

The accompanying notes to consolidated financial statements are an

integral part of these consolidated financial statements.

​

20

AMREP CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Amounts in thousands)

​

​ ​ ​ ​ ​ ​ ​

​ ​ Year Ended April 30,

Other comprehensive income, net of tax: ​ ​ ​ ​

Decrease in pension liability ​ ​ 75 ​ ​ 2,655

Income tax effect ​ ​ (25) ​ ​ (811)

Decrease in pension liability, net of tax ​ 50 ​ 1,844

Other comprehensive income ​ 50 ​ 1,844

Total comprehensive income ​ $ 15,912 ​ $ 9,236

​

The accompanying notes to consolidated financial statements are an

integral part of these consolidated financial statements.

​

21

AMREP CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

(Amounts in thousands)

​

​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

​ ​ ​ ​ ​ ​ ​ Capital ​ ​ ​ ​ Accumulated ​ Treasury ​ ​

​ ​ ​ ​ ​ ​ ​ Contributed ​ ​ ​ ​ Other ​ Stock, ​ ​

​ ​ Common Stock ​ in Excess of ​ Retained ​ Comprehensive ​ at ​ ​

​ Shares Amount Par Value Earnings Loss Cost Total

Issuance of restricted common stock 9 ​ 1 ​ 41 ​ — ​ — ​ — ​ 42

Issuance of deferred common stock units — ​ — ​ 90 ​ — ​ — ​ — ​ 90

Net income — ​ — ​ — ​ 7,392 ​ — ​ — ​ 7,392

Other comprehensive income — ​ — ​ — ​ — ​ 1,844 ​ — ​ 1,844

Issuance of restricted common stock ​ 13 ​ ​ 1 ​ ​ 149 ​ ​ — ​ ​ — ​ ​ — ​ ​ 150

Net income ​ — ​ ​ — ​ ​ — ​ ​ 15,862 ​ ​ — ​ ​ — ​ ​ 15,862

Other comprehensive loss ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ 50 ​ ​ — ​ ​ 50

​

The accompanying notes to consolidated financial statements are an

integral part of these consolidated financial statements.

​

22

AMREP CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Amounts in thousands)

​

​ ​ ​ ​ ​ ​ ​

​ ​ Year Ended April 30,

CASH FLOWS FROM OPERATING ACTIVITIES: ​ ​

Amortization of debt issuance costs ​ 84 ​ 59

Non-cash credits and charges: ​ ​ ​ ​ ​ ​

Stock-based compensation ​ 217 ​ 132

Deferred income tax provision ​ 1,766 ​ 2,494

Net periodic pension cost ​ (490) ​ (36)

Gain on debt forgiveness ​ ​ (45) ​ ​ (300)

Changes in assets and liabilities: ​ ​ ​ ​

Real estate inventory and investment assets ​ (7,295) ​ 2,380

Accounts payable and accrued expenses ​ 1,486 ​ 1,290

Accrued pension costs ​ — ​ (1,847)

Net cash provided by operating activities ​ 15,476 ​ 12,609

​ ​ ​ ​ ​

CASH FLOWS FROM INVESTING ACTIVITIES: ​ ​ ​ ​

Proceeds from corporate-owned life insurance policy ​ 92 ​ —

Capital expenditures ​ (1,287) ​ (5)

Net cash used in investing activities ​ (1,195) ​ (5)

​ ​ ​ ​ ​

CASH FLOWS FROM FINANCING ACTIVITIES: ​ ​ ​ ​

Proceeds from debt financing ​ 6,857 ​ 6,611

Principal debt payments ​ (8,264) ​ (6,680)

Payments for debt issuance costs ​ (50) ​ (120)

Repurchase of common stock ​ ​ (21,904) ​ ​ (5,116)

Net cash used in financing activities ​ (23,361) ​ (5,305)

​ ​ ​ ​ ​

Cash, cash equivalents and restricted cash, beginning of year ​ 24,801 ​ 17,502

Cash, and cash equivalents, end of year ​ $ 15,721 ​ $ 24,801

​ ​ ​ ​ ​

SUPPLEMENTAL CASH FLOW INFORMATION: ​ ​ ​ ​

Income taxes refunded, net ​ $ 3 ​ $ 153

​

The accompanying notes to consolidated financial statements are an

integral part of these consolidated financial statements.

​

23

AMREP CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(1) SUMMARY OF SIGNIFICANT ACCOUNTING AND FINANCIAL REPORTING POLICIES

Organization and principles of consolidation

The consolidated financial statements include the accounts of AMREP Corporation, an Oklahoma corporation, and its subsidiaries (collectively, the “Company”). The Company, through its subsidiaries, is primarily engaged in two business segments: land development and homebuilding. The Company has no foreign sales. All significant intercompany accounts and transactions have been eliminated in consolidation.

The consolidated balance sheets are presented in an unclassified format since the Company has substantial operations in the real estate industry and its operating cycle is greater than one year. Certain 2021 balances in these financial statements have been reclassified to conform to the current year presentation with no effect on the net income or loss or shareholders’ equity.

Fiscal year

The Company’s fiscal year ends on April 30. All references to 2022 and 2021 mean the fiscal years ended April 30, 2022 and 2021, unless the context otherwise indicates.

Revenue recognition

The Company accounts for land sale revenues, home sale revenues and building sales and other revenues in accordance with Accounting Standards Update (“ASU”) 2014-09, Revenue from Contracts with Customers (Topic 606).

Land sale revenues: Revenues from land sales are recognized when the parties are bound by the terms of a contract, consideration has been exchanged, title and other attributes of ownership have been conveyed to the buyer by means of a closing and the Company is not obligated to perform further significant development of the specific property sold. In general, the Company’s performance obligation for each of these land sales is fulfilled upon the delivery of the land, which generally coincides with the receipt of cash consideration from the counterparty.

Land sale cost of revenues includes all direct acquisition costs and other costs specifically identified with the property, including pre-acquisition costs and capitalized real estate taxes and interest, and an allocation of certain common development costs associated with the entire project. Common development costs include the installation of utilities and roads, and may be based upon estimates of cost to complete. The allocation of costs is based on the estimated relative sales value of the individual parcels of land being sold to the total expected sales value for the unsold parcels of land in the applicable portion of the subdivision. Estimates and cost allocations are reviewed on a regular basis until a project is substantially completed, and are revised and reallocated as necessary on the basis of current estimates.

Home sale revenues: Revenues and cost of revenues from home sales are recognized at the time each home is delivered and title and possession are transferred to the buyer. The Company’s performance obligation to deliver a home is generally satisfied in less than one year from the date a binding sale agreement is signed. In general, the Company’s performance obligation for each home sale is fulfilled upon the delivery of the completed home, which generally coincides with the receipt of cash consideration from the counterparty. If the Company’s performance obligations are not complete upon the home closing, the Company defers a portion of the home sale revenues related to the outstanding obligations and subsequently recognizes that revenue upon completion of such obligations. As of April 30, 2022, deferred home sale revenues and costs related thereto were immaterial.

Forfeited customer deposits for homes are recognized in home sale revenues in the period in which the Company determines that the customer will not complete the purchase of the home and the Company has the right to retain the deposit. In order to promote sales of homes, the Company may offer home buyers sales incentives. These incentives vary by type and amount on a community-by-community and home-by-home basis. Incentives are reflected as a reduction in home sale revenues.

Home construction and related costs are capitalized as incurred within real estate inventory under the specific identification method on the consolidated balance sheet and are charged to home sale cost of revenues on the consolidated statement of operations when the related home is sold.

24

Building sales and other revenues: Revenues from building sales and other revenues consist of sales of buildings and other land, oil and gas royalties, infrastructure reimbursements and miscellaneous other revenues.

Sales of buildings and other land consist of building sales in New Mexico and Florida. Revenues from these building sales are recognized when the parties are bound by the terms of a contract, consideration has been exchanged, title and other attributes of ownership have been conveyed to the buyer by means of a closing and the Company is not obligated to perform further significant development of the specific property sold. In general, the Company’s performance obligation for each of these building sales is fulfilled upon the delivery of the property, which generally coincides with the receipt of cash consideration from the counterparty. Building sales and other cost of revenues includes all direct acquisition costs and other costs specifically identified with the property, including pre-acquisition and acquisition costs, if applicable, closing and selling costs and construction costs.

Oil and gas royalties are recognized at the time of receipt by the Company as such amounts are unknown with any degree of certainty prior to receipt.

Infrastructure reimbursements include amounts received from a public improvement district and private infrastructure reimbursement covenants and the payment for impact fee credits. Such amounts are recognized at the time of receipt by the Company as such amounts are unknown with any degree of certainty prior to receipt.

Miscellaneous other revenues primarily include rental payments and additional rent from tenants pursuant to leases with respect to property or buildings of the Company. Base rental payments are recognized as revenue monthly over the term of the lease. Additional rent related to the reimbursement of real estate taxes, insurance, repairs and maintenance, and other operating expenses is recognized as revenue in the period the expenses are incurred.

Cash, and cash equivalents

Cash equivalents consist of highly liquid investments that have an original maturity of ninety days or less when purchased and are readily convertible into cash. Restricted cash consists of cash deposits with a bank that are restricted due to subdivision improvement agreements with a governmental authority. The Company did not have any restricted cash as of April 30, 2022 or April 30, 2021.

Long-lived assets

Long-lived assets consist of real estate inventory and investment assets and are accounted for in accordance with Accounting Standards Codification (“ASC”) 360-10.

Real estate inventory: Real estate inventory includes land and improvements on land held for future development or sale. The cost basis of the land and improvements includes all direct acquisition costs including development costs, certain amenities, capitalized interest, capitalized real estate taxes and other costs. Interest and real estate taxes are not capitalized unless active development is underway. Real estate inventory held for future development or sale is stated at accumulated cost and is evaluated and reviewed for impairment when events or changes in circumstances indicate the carrying value of an asset may not be recoverable.

Investment assets, net: Investment assets, net consist of (i) investment land, which represents vacant, undeveloped land not held for development or sale in the normal course of business, and (ii) real estate assets that are leased or intended to be leased to third parties. Investment assets are stated at the lower of cost or net realizable value.Depreciation of investment assets (other than land) is provided principally by the straight-line method at various rates calculated to amortize the book values of the respective assets over their estimated useful lives, which generally are 10 to 40 years for buildings and improvements. Land is not subject to depreciation.

Impairment of long-lived assets: Long-lived assets are evaluated and tested for impairment when events or changes in circumstances indicate the carrying value of an asset may not be recoverable. Asset impairment tests are based upon the intended use of assets, expected future cash flows and estimates of fair value of assets. The evaluation of operating asset groups includes an estimate of future cash flows on an undiscounted basis using estimated revenue streams, operating margins and general and administrative expenses. The estimation process involved in determining if assets have been impaired and in the determination of estimated future cash flows is inherently uncertain because it requires estimates of future revenues and costs, as well as future events and conditions. If the excess of undiscounted cash flows over the carrying value of a project is small, there is a greater risk of future impairment and any resulting impairment charges could be material. Due to the subjective nature of the estimates and assumptions used in determining future cash flows, actual results could differ materially from current estimates and the Company may be required to recognize impairment charges in the future.

25

Leases

Right-of-use assets and lease liabilities are recorded on the balance sheet for all leases with an initial term over one year. Leases with an initial term of 12 months or less are not recorded on the consolidated balance sheet. Right-of-use assets are classified within other assets and the corresponding lease liability is included in accounts payable and accrued expenses in the consolidated balance sheet.

Share-based compensation

The Company accounts for awards of restricted stock, stock options and deferred stock units in accordance with ASC 718-10, which requires that compensation cost for all stock awards be calculated and amortized over the service period (generally equal to the vesting period). Compensation expense for awards of restricted stock, stock options and deferred stock units are based on the fair value of the awards at their grant dates. To estimate the grant-date fair value of stock options, the Company uses the Black-Scholes option-pricing model. The Black-Scholes model estimates the per share fair value of an option on its date of grant based on the following: the option’s exercise price; the price of the underlying stock on the date of grant; the estimated dividend yield; a “risk-free” interest rate; the estimated option term; and the expected volatility. For the “risk-free” interest rate, the Company uses a U.S. Treasury bond due in a number of years equal to the option’s expected term. To estimate expected volatility, the Company analyzes the historic volatility of the Company’s common stock.

Income taxes

Deferred income tax assets and liabilities are determined based on differences between the financial reporting and tax bases of assets and liabilities, and are measured by using currently enacted tax rates expected to apply to taxable income in the years in which those differences are expected to reverse. The Company provides a valuation allowance against deferred tax assets unless, based upon the available evidence, it is more likely than not that the deferred tax assets will be realized.

Earnings per share

Basic earnings per share is based on the weighted average number of common shares outstanding during each year. Unvested restricted shares of common stock are not included in the computation of basic earnings per share, as they are considered contingently returnable shares. Unvested restricted shares of common stock are included in diluted earnings per share if they are dilutive. Deferred stock units are included in both basic and diluted earnings per share computations. Stock options are not included in the computation of basic earnings per share. Stock options are included in diluted earnings per share if they are not anti-dilutive and are in-the-money.

Pension plan

The Company recognizes the over-funded or under-funded status of its defined benefit pension plan as an asset or liability as of the date of the plan’s year-end statement of financial position and recognizes changes in that funded status in the year in which the changes occur through comprehensive income.

Comprehensive income

Comprehensive income is defined as the change in equity during a period from transactions and other events from non-owner sources. Total comprehensive income is the total of net income or loss and other comprehensive income or loss that, for the Company, consists of the minimum pension liability net of the related deferred income tax effect.

Management’s estimates and assumptions

The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Significant judgments and estimates that affect the financial statements include, but are not limited to, (i) land sale cost of revenues calculations, which are based on land development budgets and estimates of costs to complete; (ii) cash flows, asset groupings and valuation assumptions in performing asset impairment tests of long-lived assets and assets held for sale; (iii) actuarially determined benefit obligations and other pension plan accounting and disclosures; (iv) risk assessment of uncertain tax positions; and (v) the determination of the recoverability of net deferred tax assets. The Company bases its significant estimates on historical experience and on various other assumptions that management believes are reasonable under the circumstances. Actual results could differ from these estimates.

26

Recent accounting pronouncements

In December 2019, the Financial Accounting Standards Board (the “FASB”) issued ASU 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 was effective for the Company’s fiscal year beginning May 1, 2021. The adoption of ASU 2019-12 by the Company did not have any effect on its consolidated financial statements.

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

​

(2) REAL ESTATE INVENTORY

Real estate inventory consists of (in thousands):

​ ​ ​ ​ ​ ​ ​

​ ​ April 30,

Land held for development or sale in New Mexico ​ $ 59,374 ​ $ 49,918

Land held for development or sale in Colorado ​ 3,434 ​ 3,975

Homebuilding finished inventory ​ 1,135 ​ 417

Homebuilding construction in process ​ 3,306 ​ 1,279

​

Land held for development or sale represents property located in areas that are planned to be developed or sold in the near term. A substantial majority of the Company’s real estate assets are located in Rio Rancho, New Mexico (“Rio Rancho”) and certain adjoining areas of Sandoval County, New Mexico. As a result of this geographic concentration, the Company has been and will be affected by changes in economic conditions in that region.

Land held for development or sale in Colorado as of April 30, 2022 represents an approximately 160-acre property in Brighton, Colorado. Land held for development or sale in Colorado as of April 30, 2021 represents an approximately 160-acre property in Brighton, Colorado and an approximately 5-acre property in Parker, Colorado.

Homebuilding finished inventory represents costs for residential homes that are completed and ready for sale. Homebuilding construction in process represents costs for residential homes being built.

Interest and loan costs of $224,000 and real estate taxes of $28,000 were capitalized in real estate inventory for the year ending April 30, 2022. Interest and loan costs of $105,000 and real estate taxes of $29,000 were capitalized in real estate inventory for the year ending April 30, 2021.

​

(3) INVESTMENT ASSETS, NET

Investment assets, net consist of (in thousands):

​

​ ​ ​ ​ ​ ​ ​

​ ​ April 30,

Land held for long-term investment ​ $ 9,017 ​ $ 9,775

Less accumulated depreciation ​ — ​ (6,196)

Buildings, net ​ — ​ 3,807

​

Land held for long-term investment represents property located in areas that are not planned to be developed in the near term and that has not been offered for sale in the normal course of business.

As of April 30, 2021, buildings were comprised of a 143,000 square foot warehouse and office facility located in Palm Coast, Florida. During 2022, the Company sold this warehouse and office facility. Depreciation associated with buildings was $201,000 and $542,000 for 2022 and 2021.

​

27

(4) OTHER ASSETS

Other assets consist of (in thousands):

​

​ ​ ​ ​ ​ ​ ​

​ ​ April 30,

Prepaid expenses ​ $ 366 ​ $ 324

Receivables ​ ​ 50 ​ ​ 37

Miscellaneous assets ​ ​ 81 ​ ​ 172

Property ​ ​ 1,247 ​ ​ —

Less accumulated depreciation of property and equipment ​ ​ (220) ​ ​ (194)

Property and equipment, net ​ 1,267 ​ 28

​

Prepaid expenses as of April 30, 2022 primarily consist of insurance, stock compensation, real estate taxes and utility deposits. Prepaid expenses as of April 30, 2021 primarily consist of insurance, stock compensation, prepayments for office rent, broker’s commissions and security deposits. Amortized lease cost for right-of-use assets associated with the leases of office facilities was $70,000 and $18,000 for 2022 and 2021.

In 2022, the Company acquired a 7,000 square foot office building in Rio Rancho from which its real estate business now operates. Depreciation expense associated with property and equipment was $24,000 and $11,000 for 2022 and 2021.

​

(5) ACCOUNTS PAYABLE AND ACCRUED EXPENSES

Accounts payable and accrued expenses consist of (in thousands):

​

​ ​ ​ ​ ​ ​ ​

​ ​ April 30,

Real estate operations ​ ​ ​ ​ ​ ​

Real estate customer deposits ​ ​ 1,357 ​ ​ 1,769

Corporate operations ​ 456 ​ 654

​

​

(6) NOTES PAYABLE

Notes payable, net consist of (in thousands):

​

​ ​ ​ ​ ​ ​ ​

​ ​ April 30,

Real estate notes payable ​ $ 2,030 ​ $ 3,482

Unamortized debt issuance costs ​ — ​ (34)

​

28

The following tables present information on the Company’s notes payable in effect as of April 30, 2022 (dollars in thousands):

​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

​ ​ Principal Amount ​ ​ ​ ​ ​ ​ ​ ​

​ ​ ​ ​ Available for ​ Outstanding ​ Principal ​

​ ​ ​ ​ New Borrowings ​ Principal Amount ​ Repayments

​ ​ ​ ​ April 30, ​ April 30, ​ Year ended

Revolving Line of Credit BOKF ​ $ 2,427 ​ $ — ​ $ — ​ $ — ​

​ ​ ​ ​ ​ ​ ​ $ 2,030 ​ $ — ​ ​ ​ ​

​

​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

​ ​ ​ ​ Capitalized Interest

​ ​ ​ Mortgaged Property and Fees ​ ​

​ Interest Rate Book Value Year ended April 30 ​ ​

Revolving Line of Credit 3.75 % $ 1,693 ​ $ — ​ $ — February 2024

​

As of April 30, 2022, the Company and each of its subsidiaries were in compliance with the financial covenants contained in the loan documentation for the then outstanding notes payable. Additional information regarding each of the above notes payable is provided below.

ASW made certain representations and warranties in connection with this loan and is required to comply with various covenants, reporting requirements and other customary requirements for similar loans, including ASW and its subsidiaries having at least $3.0 million of unencumbered and unrestricted cash, cash equivalents and marketable securities in order to be entitled to advances under the loan. The loan documentation contains customary events of default for similar financing transactions, including: ASW’s failure to make principal, interest or other payments when due; the failure of ASW to observe or perform its covenants under the loan documentation; the representations and warranties of ASW being false; the insolvency or bankruptcy of ASW; and the failure of ASW to maintain a net worth of at least $32 million. Upon the occurrence and during the continuance of an event of default, BOKF may declare the outstanding principal amount and all other obligations under the loan immediately due and payable. ASW incurred customary costs and expenses and paid certain fees to BOKF in connection with the loan.

Wymont and ASW made certain representations and warranties in connection with this loan and are required to comply with various covenants, reporting requirements and other customary requirements for similar loans. The loan documentation contains customary events of default for similar financing transactions, including: Wymont’s failure to make principal, interest

29

or other payments when due; the failure of Wymont or ASW to observe or perform their respective covenants under the loan documentation; the representations and warranties of Wymont or ASW being false; the insolvency or bankruptcy of Wymont or ASW; and the failure of ASW to maintain a net worth of at least $32 million. Upon the occurrence and during the continuance of an event of default, BOKF may declare the outstanding principal amount and all other obligations under the loan immediately due and payable. Wymont incurred customary costs and expenses and paid certain fees to BOKF in connection with the loan.

The following table summarizes the notes payable scheduled principal repayments subsequent to April 30, 2022 (in thousands):

​ ​ ​ ​

Fiscal Year Scheduled Payments

​

The following table presents information on the Company’s notes payable in effect as of April 30, 2021 and terminated prior to April 30, 2022 (in thousands):

​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

​ ​ ​ ​ Original ​ ​ ​ ​ Capitalized Interest

​ ​ ​ ​ Maximum ​ Outstanding ​ and Fees

​ ​ ​ ​ Available ​ Principal Amount ​ Year ended April 30

Hawk Site U37 SLFCU ​ 3,000 ​ — ​ — ​ 7

Lavender Fields – acquisition Seller ​ 1,838 ​ 1,749 ​ — ​ —

Lavender Fields – development BOKF ​ 3,750 ​ 1,293 ​ 23 ​ —

​ ​ ​ ​ ​ ​ ​ $ 3,482 ​ ​ ​ ​ ​ ​

​

Additional information regarding each of the above terminated notes payable is provided below:

30

​

(7) REVENUES

Land sale revenues. In 2022, land sale revenues included sales of developed residential land, developed commercial land and undeveloped land to multiple customers. In 2021, substantially all of the land sale revenues were with respect to the sale of developed residential land.

Home sale revenues. Home sale revenues are from homes constructed and sold by the Company in the Albuquerque, New Mexico metropolitan area.

Building sales and other revenues. Building sales and other revenues consist of(in thousands):

​

​ ​ ​ ​ ​ ​ ​

​ ​ Year Ended April 30,

Sales of buildings and other land ​ $ 8,439 ​ $ 9,493

Oil and gas royalties ​ ​ 276 ​ ​ 135

Infrastructure reimbursements ​ ​ 1,189 ​ ​ 1,228

Miscellaneous other revenues ​ ​ 446 ​ ​ 959

​

Sales of buildings and other land during 2022 consists of revenues from the sale of a 4,338 square foot, single tenant retail building in the La Mirada subdivision and from the sale of a 143,000 square foot warehouse and office facility located in Palm Coast, Florida. Sales of buildings and other land during 2021 consists of revenues from the sale of a 14,000 square foot, single tenant retail building in the Las Fuentes at Panorama Village subdivision in Rio Rancho and from the sale of a 61,000 square foot warehouse and office facility located in Palm Coast, Florida.

The Company owns certain minerals and mineral rights in and under approximately 147 surface acres of land in Brighton, Colorado leased to a third party for as long as oil or gas is produced and marketed in paying quantities from the property or for additional limited periods of time if the lessee undertakes certain operations or makes certain de minimis shut-in royalty payments. The lessee has pooled various minerals and mineral rights, including the Company's minerals and mineral rights, for purposes of drilling and extraction. After applying the ownership and royalty percentages of the pooled minerals and mineral rights, the lessee is required to pay the Company a royalty on oil and gas produced from the pooled property of 1.42% of the proceeds received by the lessee from the sale of such oil and gas, and such royalty will be charged with 1.42% of certain post-production costs associated with such oil and gas.

The Company owns certain minerals and mineral rights in and under approximately 55,000 surface acres of land in Sandoval County, New Mexico. The lease to a third party with respect to such mineral rights expired in 2021 and no drilling had commenced with respect to such mineral rights. The Company did not record any revenue in 2022 or 2021 related to this lease.

The Company receives infrastructure reimbursements through a public improvement district and private infrastructure reimbursement covenants and the payment for impact fee credits. A portion of the Lomas Encantadas subdivision and a portion of the Enchanted Hills subdivision in Rio Rancho are subject to a public improvement district. The public improvement district reimburses the Company for certain on-site and off-site costs of developing the subdivisions by imposing a special levy on the real property owners within the district.

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The Company has accepted discounted prepayments of amounts due under the public improvement district. The Company instituted private infrastructure reimbursement covenants on a portion of the property in Hawk Site and in Lavender Fields. Similar to a public improvement district, the covenants are expected to reimburse the Company for certain on-site and off-site costs of developing the subject property by imposing a special levy on the real property owners subject to the covenants. The Company has accepted discounted prepayments of amounts due under the public improvement district.

Miscellaneous other revenues for 2022 primarily consist of rent received from the tenant of the building in Palm Coast, Florida and tenants at a shopping center in Albuquerque, New Mexico, a non-refundable option payment and installation of telecommunications equipment in subdivisions. Miscellaneous other revenues for 2021 primarily consist of payments for rent received from the tenant of the buildings in Palm Coast, Florida and a tenant at a retail building in Rio Rancho and installation of telecommunications equipment in subdivisions.

Major customers. There were four customers with revenues in excess of 10% of the Company’s revenues during 2022. The revenues for each such customer during 2022 are as follows: $10,982,000, $7,107,000, $6,750,000 and $6,445,000, with each of these revenues reported in the Company’s land development business segment. There were three customers with revenues in excess of 10% of the Company’s revenues during 2021. The revenues for each such customer during 2021 are as follows: $10,582,000, $6,606,000 and $4,858,000,with each of these revenues reported in the Company’s land development business segment.

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(8) COST OF REVENUES

Land sale cost of revenues includes all direct acquisition costs and other costs specifically identified with the property and an allocation of certain common development costs associated with the entire project.

Home sale cost of revenues includes costs for residential homes that were sold.

Building sales and other cost of revenues for 2022 consisted of expenses associated with the sale of a 4,338 square foot, single tenant retail building in the La Mirada subdivision and the sale of a 143,000 square foot warehouse and office facility located in Palm Coast, Florida. Building sales and other cost of revenues for 2021 consisted of expenses associated with the sale of a 14,000 square foot, single tenant retail building in the Las Fuentes at Panorama Village subdivision in Rio Rancho and the sale of a 61,000 square foot warehouse and office facility located in Palm Coast, Florida.

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(9) GENERAL AND ADMINISTRATIVE EXPENSES

General and administrative expenses consist of (in thousands):

​ ​ ​ ​ ​ ​ ​

​ ​ Year Ended April 30,

​

​

(10) FAIR VALUE MEASUREMENTS

The FASB’s accounting guidance defines fair value and establishes a framework for measuring fair value. That framework provides a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The FASB’s guidance classifies the inputs to measure fair value into the following hierarchy:

Level 1 Unadjusted quoted prices for identical assets or liabilities in active markets.

Level 2 Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in inactive markets; inputs other than quoted prices that are observable for the asset or liability; and inputs that are derived principally from or corroborated by observable market data by correlation or other means. If the asset or liability has a specified (contractual) term, the Level 2 input must be observable for substantially the full term of the asset or liability.

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Level 3 Inputs for the asset or liability are unobservable and reflect the reporting entity’s own assumptions about the assumptions that market participants would use in pricing the asset or liability.

The fair value measurement level of an asset or liability within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Valuation techniques need to maximize the use of observable inputs and minimize the use of unobservable inputs. There were no transfers between Levels 1, 2 or 3 during 2022 or 2021.

The Financial Instruments Topic of the FASB Accounting Standards Codification requires disclosure of fair value information about financial instruments, whether or not recognized in the balance sheet, for which it is practicable to estimate that value. The Topic excludes all nonfinancial instruments from its disclosure requirements. Fair value is determined under the hierarchy discussed above. Accordingly, the aggregate fair value amounts presented do not represent the underlying value of the Company. The following methods and assumptions are used in estimating fair value disclosure for financial instruments: the carrying amounts of cash and cash equivalents and trade payables approximate fair value because of the short maturity of these financial instruments; and debt that bears variable interest rates indexed to prime or LIBOR also approximates fair value as it reprices when market interest rates change.

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(11) BENEFIT PLANS

Pension plan

The Company has a defined benefit pension plan for which accumulated benefits were frozen and future service credits were curtailed as of March 1, 2004. Under generally accepted accounting principles, the Company’s defined benefit pension plan was overfunded as of April 30, 2022 by $90,000, with $18,054,000 of assets and $17,964,000 of liabilities, and was underfunded as of April 30, 2021 by $476,000, with $21,102,000 of assets and $21,578,000 of liabilities. The pension plan liabilities were determined using a weighted average discount interest rate of 3.97% per year as of April 30, 2022 and 2.48% per year as of April 30, 2021, which are based on the FTSE Pension Discount Curve as of such dates as it corresponds to the projected liability requirements of the pension plan.

The pension plan is subject to minimum IRS contribution requirements, but these requirements can be satisfied by the use of the pension plan’s existing credit balance. No cash contributions are required during 2022. The Company made voluntary contributions to the pension plan of $1,847,000 during 2021. Pension assets and liabilities are measured at fair value (measured in accordance with the guidance described in Note 10) and are subject to fair value adjustment in certain circumstances (for example, when there is evidence of impairment). There were no impairments resulting in a change in fair value during 2022 and 2021.

Net periodic pension cost for 2022 and 2021 was comprised of the following components (in thousands):

​

​ ​ ​ ​ ​ ​ ​

​ ​ Year Ended April 30,

Interest cost on projected benefit obligation ​ $ 503 ​ $ 504

Expected return on assets ​ (1,535) ​ (1,409)

Recognized net actuarial loss ​ 392 ​ 529

Net periodic pension cost ​ $ (490) ​ $ (36)

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Assumptions used in determining net periodic pension cost and the benefit obligation were:

​

​ ​ ​ ​ ​ ​

​ ​ Year Ended April 30,

Discount rate used to determine net periodic pension cost 2.48 % 2.29 %

Discount rate used to determine pension benefit obligation 3.97 % 2.48 %

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The expected return on assets for the pension plan is based on management’s expectation of long-term average rates of return to be achieved by the underlying investment portfolio. In establishing this assumption, management considers historical and expected returns for the asset classes in which the pension plan is invested, as well as current economic and market conditions.

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The actuarial gain of $2,414,000 for the fiscal year ending April 30, 2022 consists of a gain from a change in discount rate gain of $2,360,000, other assumption losses of $76,000 and plan experience gains of $130,000. The following table sets forth changes in the pension plan’s benefit obligation and assets, and summarizes components of amounts recognized in the Company’s consolidated balance sheet (in thousands):

​

​ ​ ​ ​ ​ ​ ​

​ ​ April 30,

Change in benefit obligation: ​ ​

Benefit obligation at beginning of year ​ $ 21,578 ​ $ 23,274

Benefit obligation at end of year ​ $ 17,964 ​ $ 21,578

Change in plan assets: ​ ​

Fair value of plan assets at beginning of year ​ $ 21,102 ​ $ 18,260

Actual return on plan assets ​ (1,239) ​ 2,808

Company contributions ​ — ​ 1,847

Fair value of plan assets at end of year ​ $ 18,054 ​ $ 21,102

Overfunded (underfunded) status ​ $ 90 ​ $ (476)

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The funded status of the pension plan is equal to the net liability recognized in the consolidated balance sheets. The following table summarizes the amounts recorded in accumulated other comprehensive loss, which have not yet been recognized as a component of net periodic pension costs (in thousands):

​

​ ​ ​ ​ ​ ​ ​

​ ​ Year Ended April 30,

Pretax accumulated comprehensive loss ​ $ 8,350 ​ $ 8,426

​

The following table summarizes the changes in accumulated other comprehensive loss related to the pension plan for the years ended April 30, 2022 and 2021 (in thousands):

​

​ ​ ​ ​ ​ ​ ​

​ ​ Pension Benefits

​ Pretax Net of Tax

Net actuarial gain ​ ​ (2,127) ​ ​ (1,483)

Amortization of net loss ​ (529) ​ (361)

Net actuarial loss ​ ​ 316 ​ ​ 214

Amortization of net loss ​ ​ (392) ​ ​ (264)

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The Company recorded, net of tax, other comprehensive income of $50,000 and $1,844,000 in 2022 and 2021 to account for the net effect of changes to the unfunded portion of pension liability.

The asset allocation for the pension plan by asset category was as follows:

​

​ ​ ​ ​ ​ ​

​ ​ April 30,

Equity securities 57 % 51 %

Fixed income securities 38 39 ​

Other (principally cash and cash equivalents) 5 10 ​

​

The investment mix between equity securities and fixed income securities seeks to achieve a desired return by balancing equity securities and fixed-income securities. Pension plan assets are invested in portfolios of diversified public-market equity securities and fixed income

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securities. The pension plan holds no securities of the Company. Investment allocations are made across a range of markets, industry sectors, market capitalization sizes and, in the case of fixed income securities, maturities and credit quality.

The amount of benefit payments in future fiscal years to pension plan participants payable from plan assets is expected to be as follows: 2023 - $2,386,000, 2024 - $1,635,000, 2025 - $1,574,000, 2026 - $1,536,000 and 2027 - $1,449,000 and an aggregate of $6,370,000 is expected to be paid in the fiscal five-year period 2028 through 2032.

The Company has adopted the disclosure requirements in ASC 715, which requires additional fair value disclosures consistent with those required by ASC 820. The following is a description of the valuation methodologies used for pension plan assets measured at fair value: common stock – valued at the closing price reported on a listed stock exchange; corporate bonds, debentures and government agency securities – valued using pricing models, quoted prices of securities with similar characteristics or discounted cash flow; and U.S. Treasury securities – valued at the closing price reported in the active market in which the security is traded.

The methods described above may produce a fair value calculation that may not be indicative of net realizable value or reflective of future fair values. Furthermore, while the Company believes its valuation methods are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different fair value measurement at the reporting date. The following table sets forth by level within the fair value hierarchy the pension plan’s assets at fair value as of April 30, 2022 and 2021 (in thousands):

2022:

​

​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

​ Total Level 1 Level 2 Level 3

Cash and cash equivalents ​ $ 791 ​ $ 791 ​ $ — ​ $ —

Investments at fair value: ​ ​ ​ ​ ​ ​ ​

Fixed income securities ​ 6,915 ​ 6,915 ​ — ​ —

Total assets at fair value ​ $ 18,054 ​ $ 18,054 ​ $ — ​ $ —

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2021:

​

​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

​ Total Level 1 Level 2 Level 3

Cash and cash equivalents ​ $ 2,215 ​ $ 2,215 ​ $ — ​ $ —