PRINCETON, N.J., July 26, 2012 /PRNewswire/ -- AMREP
Corporation (NYSE: AXR) today reported a net loss of $1,143,000, or $0.19 per share, for its 2012 fiscal year ended
April 30, 2012 compared to a 2011 net
loss of $7,561,000, or $1.26 per share. The results for 2012 included a
fourth quarter pre-tax, non-cash impairment charge of $570,000 ($359,000
after tax, or $0.06 per share)
reflecting the write-down of certain real estate assets. The
results for 2011 included a fourth quarter pre-tax, non-cash
impairment charge of $10,720,000
reflecting the write-down of certain real estate assets
($6,827,000 before tax and
$4,301,000, or $0.72 per share, after tax) and of all of the
goodwill of the Company's Newsstand Distribution Services business
($3,893,000 with no tax benefit, or
$0.65 per share). Revenues for 2012
were $85,360,000 compared to
$96,837,000 in the prior year.
For the fourth quarter of 2012, the net loss after the
impairment charge was $1,631,000, or
$0.27 per share, compared to a net
loss after the impairment charges of $9,075,000, or $1.51 per share, in the same period of
2011. Fourth quarter 2012 revenues were $19,092,000 versus fourth quarter 2011 revenues
of $22,088,000.
Excluding the impairment charges in both years, the net loss for
the fourth quarter of 2012 was $1,272,000, or $0.21 per share, and for the full year of 2012
was $783,000, or $0.13 per share, compared to a net loss of
$882,000, or $0.15 per share, in the fourth quarter of 2011,
and net income of $632,000, or
$0.11 per share, for the full year of
2011.
Revenues from Media Services operations, which include
Subscription Fulfillment Services operations conducted by the
Company's Palm Coast Data subsidiary and Newsstand Distribution and
Product Services and other operations conducted by its Kable Media
Services subsidiary, decreased from $21,864,000 and $94,963,000 for the fourth quarter and full year
of 2011 to $18,632,000 and
$83,447,000 for the same periods in
2012. Magazine publishers, which are the principal customers
of these operations, have continued to be negatively impacted by
increased competition from new media distribution sources and also
by the effects of the recent recession and the continued weak U.S.
economy. The result has been a trend of reduced subscription
and newsstand magazine sales, which has caused publishers to close
some magazine titles and seek more favorable terms from Palm Coast
and Kable and their competitors when contracts are up for bid or
renewal. As a consequence of these and other factors,
including customer losses, revenues from Subscription Fulfillment
Services operations decreased from $16,844,000 and $73,618,000 for the fourth quarter and full year
of 2011 to $13,455,000 and
$62,230,000 for the same periods of
2012, while revenues from Newsstand Distribution Services
operations decreased from $2,542,000
and $11,030,000 for the fourth
quarter and full year of 2011 to $2,015,000 and $9,127,000 for the same periods of 2012. Revenues
from Kable's Product Services and Other businesses segment were
$2,478,000 and $10,315,000 in the fourth quarter and full year
of 2011 versus $3,162,000 and
$12,090,000 in the same periods of
2012, with changes being primarily due to increases in temporary
staffing revenues which were partially offset by declines in
revenues from the Company's specialty packaging business. The
overall revenue decrease in Media Services operations was partially
offset by decreases in Media Services operating and general and
administrative expenses due to reduced payroll, benefits and other
variable costs. Media Services operating expenses decreased
from $18,516,000 (84.7% of related
revenues) and $77,972,000 (82.1% of
related revenues) in the fourth quarter and full year of 2011 to
$16,743,000 (89.9% of related
revenues) and $70,076,000 (84.0% of
related revenues) for the same periods of 2012, while Media
Services general and administrative expenses decreased from
$2,496,000 (11.4% of related
revenues) and $9,385,000 (9.9% of
related revenues) in the fourth quarter and full year of 2011 to
$2,133,000 (11.4% of related
revenues) and $8,783,000 (10.5% of
related revenues) for the same periods of 2012.
Revenues from land sales at the Company's AMREP Southwest
subsidiary increased from $210,000
and $1,780,000 in the fourth quarter
and full year of 2011 to $454,000 and
$1,889,000 for the comparable periods
of 2012. Results for all periods were substantially lower
than the Company has historically experienced in its principal
market of Rio Rancho, New Mexico,
due to a severe decline in the real estate market in the greater
Albuquerque-metro and Rio Rancho areas that began late in fiscal
2008. The trend of declining permits for new home
construction in Rio Rancho also
continued, with 15% fewer single-family residential building
permits issued during fiscal 2012 than in fiscal 2011. Faced with
these adverse conditions, many builders have slowed the pace of
building on developed lots previously purchased from the Company in
Rio Rancho and delayed or
cancelled the purchase of additional developed lots. These
factors have also contributed to a steep decline in the Company's
sale of undeveloped land to both builders and investors.
In Rio Rancho, the Company
offers for sale both developed and undeveloped lots to national,
regional and local home builders, commercial and industrial
property developers and others. The average selling price of
land sold by the Company in Rio
Rancho was $5,000 and
$18,000 per acre for the fourth
quarter and full year of 2012 compared to $40,000 and $81,000
per acre for the same periods of 2011. The average gross
profit percentage on land sales was approximately 52% and 67% for
the three and twelve month periods in 2012 compared to
approximately 64% and 37% for the same periods of 2011. All these
selling price and gross profit percentage variances reflected
differences in the mix of properties sold in each period. For
example, the sale of undeveloped land in the fourth quarter of 2012
consisted of land sold to a quasi-governmental agency under threat
of condemnation for use as part of a flood plain, with a selling
price of only $5,000 per acre.
As a result of these and other factors, including the nature and
timing of specific transactions, revenues, average selling prices
and related average gross profits from land sales can vary
significantly from period to period and prior results are not
necessarily a good indication of what may occur in future
periods. In addition, as noted above, AMREP Southwest
recorded impairment charges in 2012 and 2011 due to current
appraisals of a portion of its real estate that in each year showed
a deterioration in fair market value from the prior year.
The effective rate of the Company's tax benefit was 34.6% and
43.9% for the fourth quarter and full year 2012 compared to 24.0%
and 29.8% for the same periods in 2011. The difference
between the statutory tax rate and the effective rate of the tax
benefit in the fourth quarter and full year periods was primarily
due to (i) permanent items, the most significant being the fourth
quarter 2011 impairment charge of $3,893,000 associated with non-tax deductible
goodwill, and (ii) a reduction of liabilities of $382,000 and $764,000 in the third quarters of 2012 and 2011
related to unrecognized tax benefits due to the expiration of the
statute of limitations on certain prior year tax benefits.
For more detail regarding the impairment charges taken by the
Company in 2012 and 2011 and for additional information regarding
the Company's financial results, please refer to the Company's
Annual Report on Form 10-K filed today with the Securities and
Exchange Commission.
AMREP Corporation's Media Services business, conducted by its
Kable Media Services, Inc. and Palm Coast Data LLC subsidiaries,
distributes magazines to wholesalers and provides subscription and
product fulfillment and related services to publishers and others,
and its AMREP Southwest Inc. subsidiary is a major landholder and
leading developer of real estate in New
Mexico.
Two Schedules Follow
****
Schedule
1
|
AMREP
CORPORATION AND SUBSIDIARIES
|
FINANCIAL HIGHLIGHTS
|
|
|
|
Three
Months Ended April 30,
|
|
|
2012
|
|
2011
|
Revenues
|
|
$
19,092,000
|
|
$
22,088,000
|
|
|
|
|
|
Net income
(loss)
|
|
$
(1,631,000)
|
|
$
(9,075,000)
|
|
|
|
|
|
Earnings
(loss) per share – Basic and
Diluted
|
|
$
(0.27)
|
|
$
(1.51)
|
|
|
|
|
|
Weighted
average number of common shares outstanding
|
|
5,996,000
|
|
5,996,000
|
|
|
Twelve
Months Ended April 30,
|
|
|
2012
|
|
2011
|
Revenues
|
|
$
85,360,000
|
|
$
96,837,000
|
|
|
|
|
|
Net income
(loss)
|
|
$
(1,143,000)
|
|
$
(7,561,000)
|
|
|
|
|
|
Earnings
(loss) per share – Basic and
Diluted
|
|
$
(0.19)
|
|
$
(1.26)
|
|
|
|
|
|
Weighted
average number of common shares outstanding
|
|
5,996,000
|
|
5,996,000
|
|
|
|
|
|
Results
include fourth quarter after-tax, non-cash impairment charges of
$359,000
(equivalent to $0.06 per share) in 2012 and $8,194,000 (equivalent
to $1.37 per share) in 2011.
|
Schedule
2
|
|
The
Company's land sales in Rio Rancho, New Mexico were as follows
(dollar amounts in thousands):
|
|
|
|
|
|
2012
|
|
2011
|
|
Acres
Sold
|
|
Revenues
|
|
Revenues
per Acre
|
|
Acres
Sold
|
|
Revenues
|
|
Revenues
per Acre
|
Three
months ended April 30:
|
|
|
|
|
|
|
|
|
|
|
|
Developed
|
|
|
|
|
|
|
|
|
|
|
|
Residential
|
-
|
|
$
-
|
|
$
-
|
|
-
|
|
$
-
|
|
$
-
|
Commercial
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
Total Developed
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
Undeveloped
|
84
|
|
454
|
|
5
|
|
5
|
|
210
|
|
40
|
Total
|
84
|
|
$
454
|
|
$
5
|
|
5
|
|
$
210
|
|
$
40
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve
months ended April 30:
|
|
|
|
|
|
|
|
|
|
|
|
Developed
|
|
|
|
|
|
|
|
|
|
|
|
Residential
|
-
|
|
$
-
|
|
$
-
|
|
3
|
|
$
1,031
|
|
$
344
|
Commercial
|
4
|
|
748
|
|
178
|
|
-
|
|
35
|
|
-
|
Total Developed
|
4
|
|
748
|
|
178
|
|
3
|
|
1,066
|
|
344
|
Undeveloped
|
100
|
|
1,141
|
|
11
|
|
19
|
|
714
|
|
38
|
Total
|
104
|
|
$
1,889
|
|
$
18
|
|
22
|
|
$
1,780
|
|
$
81
|
|
|
|
|
|
|
|
|
|
|
|
|
The sale
of undeveloped land in the fourth quarter of 2012 consisted of land
sold to a quasi-governmental agency under threat of condemnation
for its use as part of a flood plain, and the nature of the land
and resulting average selling price are not believed to be
representative of the Company's inventory and investment
properties.
|
SOURCE AMREP Corporation