SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                  FORM 10-K/A-1
               [ X ] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended     April 30, 2002  Commission File Number 1-4702
                              --------------                         ------
                                       OR
          [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

    For the transition period from ______________ to _______________

                               AMREP CORPORATION
              ----------------------------------------------------
             (Exact name of registrant as specified in its Charter)

  Oklahoma                                                     59-0936128
-------------------------------                              ------------------
(State or other jurisdiction of                              (IRS Employer
incorporation or organization)                               Identification No.)

  641 Lexington Ave., 6th Floor
  New York, New York                                           10022
---------------------------------------                      ----------
(Address of principal executive offices)                     (Zip Code)

Registrant's telephone number, including area code:  (212) 705-4700
                                                     --------------

Securities registered pursuant to Section 12(b) of the Act:
                                                           Name of Each Exchange
Title of Each Class                                        on Which Registered
-------------------                                        ---------------------
Common Stock $.10 par value                              New York Stock Exchange


Securities registered pursuant to Section 12(g) of the Act:  None

Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  Registrant  was
required  to file  such  reports),  and  (2) has  been  subject  to such  filing
requirements for the past 90 days. Yes X No

Indicate by check mark if disclosure of delinquent  filers  pursuant to Item 405
of Regulation  S-K is not contained  herein,  and will not be contained,  to the
best  of  the  Registrant's   knowledge,  in  definitive  proxy  or  information
statements  incorporated  by  reference  in Part  III of this  Form  10-K or any
amendment to this Form 10-K. [ X ]

Aggregate market value of Common Stock held by non-affiliates of the Registrant,
computed by  reference  to the last sales price of such Common Stock on July 22,
2002, on the New York Stock Exchange Composite Tape - $20,099,848.

Number of shares of Common Stock, par value $.10 per share,  outstanding at July
22, 2002 - 6,577,612.


                       DOCUMENTS INCORPORATED BY REFERENCE

Portions of the  following  documents  of the  Registrant  are  incorporated  by
reference into the indicated  parts of this report:  Definitive  Proxy Statement
for 2002 Annual Meeting - Part III.



<PAGE>


                                     PART I
                                     ------
Item 1.          Business
-------          --------            GENERAL

The Company* is primarily engaged in two unrelated businesses,  each operated by
a group of wholly-owned subsidiaries: the Real Estate business operated by AMREP
Southwest Inc. and its subsidiaries,  and the Fulfillment  Services and Magazine
Distribution   businesses  operated  by  Kable  News  Company,  Inc.  and  Kable
Distribution Services, Inc., respectively, and their subsidiaries (collectively,
"Kable").

Data  concerning  Industry  Segments  is  set  forth  in  Note  13 of  Notes  to
Consolidated  Financial  Statements.  The Company's foreign sales and activities
are not significant.

                             REAL ESTATE OPERATIONS

Recent Developments

For many years,  the Company was both a real estate  developer  and a builder of
single-family  homes,  originally  in Rio  Rancho,  New  Mexico  and then in the
Denver, Colorado,  Sacramento,  California and Portland,  Oregon metro areas. In
the early 1960s,  the Company  established the community that now is the City of
Rio Rancho,  New Mexico,  and until 1999 was the predominant  builder of housing
there.  Rio  Rancho,  which  adjoins  Albuquerque,   now  has  a  population  of
approximately  53,000 people. The Company entered the Denver market in 1993, and
in 1997 it  purchased  the  assets  of a land  developer  and  homebuilder  with
operations in the Sacramento and Portland markets.  However, in 1999 the Company
decided to (i) cease all homebuilding  operations and (ii) sell its landholdings
in California,  Colorado and Oregon. It now is out of the homebuilding  business
and,  as  noted  below,  has sold or is  offering  for  sale  nearly  all of its
landholdings outside of New Mexico.

Land Development Operations

Prior to fiscal 1999,  the Company  developed  both  residential  and commercial
sites at Rio Rancho and from time to time bought acreage in Colorado, California
and Oregon for its own homebuilding  operations and to develop for sale to other
builders.  As discussed above, the Company  currently is performing  development
work only at Rio Rancho.

Rio Rancho  (including the City) consists of 91,049 contiguous acres in Sandoval
County,  New Mexico,  near  Albuquerque,  of which some  72,700  acres have been
platted into approximately 112,200 homesite and commercial lots and 16,300 acres
are  dedicated to community  facilities,  roads and drainage  with the remainder
consisting of unplatted land. At April 30, 2002, a total of approximately 83,300
of the lots had been sold. The Company currently owns approximately 21,600 acres
in Rio Rancho, of which approximately 6,300 acres are in contiguous blocks which
have been  developed or are suitable for  development  and  approximately  2,200
acres are in areas with a high  concentration of ownership  suitable for special
assessment  districts  or city  redevelopment  areas  which may allow for future
development under the auspices of local governments. The balance is in scattered
lots which may require the purchase of a sufficient  number of adjoining lots to
create tracts suitable for  development or which may be sold  individually or in
small groups.



_________________
* As used herein,  "Company" includes the Registrant and its subsidiaries unless
the context requires or indicates otherwise.




                                       2
<PAGE>


The  development  activity  includes the  obtaining  of  necessary  governmental
approvals  ("entitlements"),  installation  of  utilities  and  necessary  storm
drains,  and  building or  improving  of roads.  At Rio  Rancho,  the Company is
developing both  residential lots and sites for commercial and industrial use as
the demand warrants,  and also is securing  entitlements  for large  development
tracts for sale to homebuilders. The engineering work at Rio Rancho is performed
by both Company  employees and outside firms,  but development work is performed
by outside  contractors.  Land at Rio Rancho is marketed  by Company  personnel,
both  directly and through  brokers.  The Company  competes with other owners of
land in the Albuquerque  area who offer for sale developed  residential lots and
sites for commercial and industrial use.

The commercial  areas in Rio Rancho  presently  include more than 500 businesses
and professional offices, as well as 15 shopping centers with approximately 1.25
million square feet of retail space and office space,  including a 55,000 square
foot  office  building  owned  by  the  Company.   The  industrial   areas  have
approximately  80  buildings  with over 3.2  million  square  feet,  including a
manufacturing facility containing approximately 2.1 million square feet which is
owned and occupied by Intel  Corporation.  Intel, Rio Rancho's largest employer,
will be  completing  construction  on a 1 million  square foot  expansion of its
plant in the fall of 2002.

Since early 1977, no individual  lots without homes at Rio Rancho have been sold
by the Company to consumers.  Over 50,000 lots were sold prior to 1977, and most
of these are in areas  where  utilities  have not yet been  installed.  However,
under  certain  of the  contracts  pursuant  to which  the lots  were  sold,  if
utilities  have not reached the  respective  lot when the  purchaser is ready to
build a home,  the  Company  is  obligated  to  exchange  a lot in an area  then
serviced  by  water,  telephone  and  electric  utilities  for  the  lot  of the
purchaser,  without  cost  to  the  purchaser.  The  Company  has  not  incurred
significant costs related to such exchanges.

At April 30, 2002, the Company owned two tracts of land in Colorado,  consisting
of one residential property of approximately 160 acres planned for approximately
350 homes which is being  offered for sale subject to the Company  obtaining all
necessary  approvals,  and one  property  of  approximately  10 acres  zoned for
commercial  use, which is also being offered for sale but which may be developed
by the Company.

Home Building Operations

The Company has completed all homebuilding activities.  Although the Company has
no present plans to do any further homebuilding, the decision to change its real
estate  focus  to  emphasize  land  development  operations  in New  Mexico  and
wind-down  homebuilding  operations  is not  necessarily  a permanent  change of
strategy.

Other Real Estate Projects

The Company developed the Eldorado at Santa Fe, New Mexico subdivision which had
approximately  2,400 homes as of April 30, 2002.  The Company sold 21 lots there
in fiscal 2002,  and 10 lots remained to be sold at the end of fiscal 2002.  The
Company  also  owns and  operates  a water  utility  company  which  serves  the
subdivision and is under contract for sale.

The Company also owns approximately 14 acres in the Orlando,  Florida area, much
of which is or is anticipated to be the subject of a condemnation proceeding.


                                       3
<PAGE>


            FULFILLMENT SERVICES AND MAGAZINE DISTRIBUTION OPERATIONS

Through Kable,  the Company (i) performs  fulfillment  and related  services for
publishers and other customers and (ii) distributes  periodicals  nationally and
in Canada and, to a small  degree,  in other  foreign  countries.  As of July 1,
2002, Kable employed  approximately 900 persons,  of whom approximately 730 were
involved in its fulfillment activities and 170 in distribution activities.

Fulfillment Services

Kable's  Fulfillment  Services  business  performs a number of  fulfillment  and
fulfillment-related  activities,  principally magazine subscription  fulfillment
services,  list services and product fulfillment services,  and it accounted for
69% of Kable's total revenues in 2002.

In the magazine subscription fulfillment service operation,  Kable processes new
orders,  receives  and  accounts  for  payments,  prepares  and  sends  to  each
publisher's  printer  labels or tapes  containing  the names  and  addresses  of
subscribers for mailing each issue,  handles subscriber  telephone inquiries and
correspondence,   prepares  and  mails  renewal  and  statement   notifications,
maintains  subscriber lists and databases,  generates  marketing and statistical
reports,  processes Internet orders and prints forms and promotional  materials.
Kable performs all of these services for many clients,  but some clients utilize
only certain of them.  Although by far the largest number of magazine titles for
which Kable performs fulfillment services are consumer publications,  Kable also
performs  services  for a number of trade  (business)  publications,  membership
organizations  and government  agencies which utilize the broad  capabilities of
Kable's extensive database system.

List  services  clients  are  primarily  publishers.  In  this  activity,  Kable
maintains client customer lists, selects names for clients who rent their lists,
merges  rented  lists  with a client's  list to  eliminate  duplication  for the
client's promotional mailings, and sorts and sequences mailing labels to provide
optimum postal discounts for clients.

Product  fulfillment  services are provided  for Kable's  publisher  clients and
other direct marketers. In this activity, Kable receives, warehouses,  processes
and ships merchandise.

Kable plans to expand  these  ancillary  services,  including  lettershop,  list
services and product fulfillment services, to other, non-publisher clients.

Kable now performs fulfillment services for approximately 640 different magazine
titles for  approximately  215 clients and  maintains  almost 14 million  active
subscriber names for its client  publishers.  In a typical month, Kable produces
over 15 million  mailing labels for its client  publishers and also produces and
mails approximately 4.3 million billing and renewal statements.

There are a large number of  companies  that  perform  fulfillment  services for
publishers  and with which  Kable  competes,  two of which are much  larger than
Kable.  Since publishers often utilize only a single  fulfillment  company for a
particular  publication,  there is  intense  competition  to obtain  fulfillment
contracts  with  publishers.  Competition  for  non-publisher  clients  is  also
intense.  Kable  has a  staff  whose  primary  task  is to  solicit  fulfillment
business.

Distribution Services

In  its  distribution  operation,  Kable  distributes  magazines  for  over  190
publishers.  Among the titles are many  special  interest  magazines,  including
automotive, crossword puzzles, men's sophisticates,  comics, romance and sports.
In a typical month,  Kable  distributes to wholesalers over 25 million copies of
various titles.  Kable purchases the publications  from its publishers and sells
them to approximately 53 independent  wholesalers.  The wholesalers in turn sell
the publications to individual  retail outlets.  All parties generally have full
return rights for unsold copies.  The distribution  services business  accounted
for 31% of Kable's revenues in fiscal 2002.

                                       4
<PAGE>


While  Kable  Distribution  does  not  handle  all  publications  of  all of its
publisher clients, it usually is the exclusive  distributor for the publications
it  distributes.  Kable has a distribution  sales and marketing force that works
with   wholesalers  and  retailers  to  promote  product  sales  and  assist  in
determining  the number of copies of product to be delivered  to each  retailer.
Kable  generally  does not  physically  handle any product.  It  determines,  in
consultation  with the wholesalers and publishers,  the number of copies of each
issue to be distributed,  and generates and delivers to each publisher's printer
shipping  instructions  with the addresses of the  wholesalers and the number of
copies of product to be shipped to each. All magazines  have an "off-sale"  date
(generally  the on-sale date of the next issue)  following  which the  retailers
return unsold copies to the wholesalers, who destroy them after accounting for
returned merchandise in a manner satisfactory to Kable.

Kable generally  makes  substantial  cash advances to publishers  against future
sales,  which publishers may use to help pay for printing,  paper and production
costs  prior  to the  product  going  on  sale.  Kable  is  usually  not paid by
wholesalers  for product until some time after the product has gone on sale, and
is therefore  exposed to potential credit risks with both the publishers and the
wholesalers. Its ability to limit its credit risk and make a profit is dependent
in part on its skill in estimating the number of copies of an issue which should
be printed  and  distributed  and on  limiting  its  advances  to the  publisher
accordingly.

A significant  realignment  of industry  relationships  in the  distribution  of
magazines  has occurred  over the last several  years.  It was  triggered by the
decision of certain major retailers with multiple  outlets to sharply reduce the
number of wholesalers with whom the retailers would deal. This action has led to
the  erosion  of  wholesaler  profit  margins  and to a  substantial  continuing
reduction  in  the  number  of   wholesalers   through  the  merger  of  certain
wholesalers,  the formation by certain other  wholesalers of cooperatives to bid
for the business of such retailers,  bankruptcy of wholesalers, and the complete
retirement from the business by a number of wholesalers.  The  consolidation has
reduced the number of Kable's  wholesale  customers by  approximately  60% since
fiscal 1995,  which has increased the  concentration  of its revenue  source and
trade  accounts  receivable;  at April 30,  2002,  approximately  62% of Kable's
distribution  accounts receivable was due from three customers.  In fiscal 2001,
Kable increased the accounts receivable reserve by approximately $2.3 million to
reflect  the  uncertainties  caused by these  changes,  but no  significant  new
reserves  were  required in fiscal 2002.  Management  believes  that the process
described  above  has  stabilized  over the past 12  months,  but the  potential
remains  for  additional  industry  changes  that  could  have  further  adverse
consequences  for publishers and their national  distributors,  including Kable,
with the financial  failure of a major wholesaler being a significant risk if it
were to occur.

Kable  competes  primarily  with  four  national  distributors,  all of whom are
substantially  larger than Kable. Each of these large competitors is owned by or
affiliated  with  a  magazine  publishing  company.  Such  companies  publish  a
substantial  portion of all magazines  published in the United  States,  and the
competition  for  the  distribution  rights  to the  remaining  publications  is
intense.


                                 COMPANY OFFICES

The Company's  principal  executive  offices are in New York City.  Kable has an
executive and sales office in New York City,  and its operations are centered in
both owned and leased facilities in Mt. Morris,  Illinois and Marion, Ohio. Real
estate operations are headquartered in Rio Rancho, New Mexico in a modern office
building owned by the Company.


                                    EMPLOYEES

The Company had  approximately  925  employees  as of July 1, 2002.  The Company
provides  retirement,  health and other  benefits to its employees and considers
its employee relations to be good.

                                       5
<PAGE>




Item 2.           Properties
-------           ----------
The  information  contained in Item 1 of this report with respect to  properties
owned by the Company is hereby incorporated herein by reference.

Item 3.           Legal Proceedings
-------           -----------------
A. On May 3, 2000, a civil action was  commenced in the United  States  District
Court of the Southern District of New York entitled United Magazine Company,  et
al. v. Murdoch Magazines  Distribution,  Inc., et al. The Complaint was filed by
five affiliated magazine wholesalers and a related service company (collectively
referred to as "Unimag") against Murdoch,  a national  distributor of magazines,
and Chas. Levy Circulating Co., a magazine wholesaler.  An Amended Complaint was
filed on August 31, 2000, in which Registrant's Kable subsidiary and three other
national  distributors  were added as  defendants.  Motions by the defendants to
dismiss the Amended  Complaint  were  granted,  with leave to the  plaintiffs to
replead  specified  claims.  In June 2001, a Second Amended  Complaint was filed
which includes two claims against  Kable:  (i) violation of the  Robinson-Patman
Act,  which  generally  prohibits  discriminatory  pricing,  and (ii)  breach of
fiduciary  duty.  Unimag  seeks  damages in the amount of at least  $275,000,000
trebled, plus punitive damages, pre-judgement interest and attorneys' fees.

The defendants moved to dismiss the Second Amended  Complaint.  The Court denied
the motions with respect to the  Robinson-Patman  Act claims but  dismissed  the
claims  for  breach  of  fiduciary  duty.  Kable  answered  the  Second  Amended
Complaint,  denying the material allegations and asserting affirmative defenses.
Kable also asserted counterclaims to recover approximately  $5,375,000 in unpaid
debts  from  Unimag.  Unimag  has  responded  to the  counterclaims  with  reply
counterclaims for compensatory and punitive damages,  based on common law claims
that are similar to claims  previously  dismissed.  The defendants have moved to
dismiss the reply  counterclaims.  Unimag is no longer in business  and does not
appear  to have the  assets  to pay if a  judgment  is  awarded  to Kable on its
counterclaims.

Pretrial discovery has recently  commenced.  It is unlikely that a trial will be
conducted prior to late 2004.

B. On or about May 14, 2002 a civil  action was  commenced in the New York State
Supreme Court,  Westchester County,  entitled Northeast Sort & Fulfillment Corp.
v. Kable Fulfillment  Services of Ohio, Inc. Kable Fulfillment Services of Ohio,
Inc. ("Kable  Fulfillment" ) is a subsidiary of Kable News Company,  Inc. In its
complaint  the  plaintiff  ("Northeast  Sort")  alleges  that  both it and Kable
Fulfillment were engaged in the mail fulfillment  business;  that Northeast Sort
had a contract with R.D.  Manufacturing  Corporation ("RDMC") for the processing
of Reader's  Digest mail for a term expiring not earlier than December 31, 1997;
that RDMC was Northeast  Sort's primary client;  that Kable  Fulfillment knew of
the contract;  that it was  foreseeable to Kable  Fulfillment  that the unlawful
termination of the contract would destroy Northeast Sort; that Kable Fulfillment
motivated solely by malice and avarice,  induced RDMC to terminate the contract;
that the contract was  terminated by RDMC in August 1996;  that  Northeast  Sort
lost millions of dollars as a result and its business was completely  destroyed;
and that RDMC entered into a fulfillment contract with Kable Fulfillment shortly
prior  to the  termination  by RDMC of the  contract.  Northeast  Sort  seeks to
recover from Kable Fulfillment  compensatory,  consequential and special damages
of not less than $15 million plus punitive damages in an amount no less than the
sum of all profits earned by Kable Fulfillment on its contract plus $5 million.

In a different  action  against RDMC for breach of contract,  Northeast Sort has
obtained a summary  judgement against RDMC on the issue of liability and a trial
on damages is scheduled for September  2002. The Court in that action ruled that
damages against RDMC would be limited by reason of damage limitation  provisions
in the contract  between  Northeast  Sort and RDMC. In its action  against Kable
Fulfillment, Northeast Sort seeks all of its alleged losses.

Pursuant to provisions in its contract with Kable  Fulfillment,  RDMC has agreed
to imdemnify and defend Kable  Fulfillment in the action  brought  against Kable
Fulfillment  by Northeast  Sort.  RDMC has retained  counsel to represent  Kable
Fulfillment. That counsel has had the case removed to the Federal District Court

                                       6
<PAGE>

for the Southern  District of New York.  That Court has stated that it will stay
all  proceedings  in the case until a final  judgment  is rendered in the action
against  RDMC.  It is  unlikely  that  a  trial  in  the  action  against  Kable
Fulfillment will be held prior to 2004. Kable  Fulfillment does not know whether
RDMC has the resources to respond to a judgement against Kable Fulfillment.

Pretrial discovery has not yet commenced in this case.

C. The Registrant  and/or its  subsidiaries are involved in various other claims
and  legal  actions  incident  to  their  operations,  which in the  opinion  of
management, based in part upon advice of counsel, will not materially affect the
consolidated  financial  position or results of operations of the Registrant and
its subsidiaries.


Item 4.           Submission of Matters to a Vote of Security Holders
-------           ---------------------------------------------------
Not Applicable.

Executive Officers of the Registrant
------------------------------------
Set forth below is certain information  concerning persons who are the executive
officers of the Company.

Name               Office Held/Principal Occupation for Past Five Years     Age
----               ----------------------------------------------------     ---
James Wall         Senior Vice President of the Company since 1991;          65
                   Chief Executive Officer of AMREP Southwest Inc.,
                   a wholly-owned subsidiary of the Company, since 1991.

Peter M. Pizza     Vice President-Chief Financial Officer since May 2001;    51
                   Controller of the Company since 1995;
                   Vice President-Controller of the Company from 1997 to 2001.

Michael P. Duloc   President and Chief Operating Officer of Kable News       46
                   Company, Inc. since November 2000;
                   President and Chief Operating Officer of Kable
                   Distribution Services from 1996 to November 2000.


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.



                                       7
<PAGE>



                                     PART II
                                     -------

Item 5.           Market for Registrant's Common Equity and
-------           -----------------------------------------
                  Related Stockholder Matters
                  ---------------------------
The Company's  common stock is traded on the New York Stock  Exchange  under the
symbol "AXR". On July 1, 2002, there were approximately  2,050 holders of record
of the common stock. The Company has  historically not paid cash dividends.  The
range of high and low closing prices for the last two fiscal years by quarter is
presented below:

           FIRST            SECOND               THIRD              FOURTH
       ---------------   ---------------    ----------------    ----------------
       HIGH       LOW     HIGH      LOW      HIGH       LOW      HIGH       LOW
      ------    ------   ------   ------    ------    ------    ------    ------
2002  $ 5.16    $ 3.75   $ 4.90   $ 3.60    $ 8.69    $ 4.40    $ 8.49    $ 7.01
2001  $ 7.37    $ 4.94   $ 5.50   $ 4.56    $ 4.75    $ 4.00    $ 4.00    $ 3.60




Item 6.           Selected Financial Data
-------           -----------------------

The following selected  consolidated  financial data of the Company is qualified
by  reference  to and  should  be  read in  conjunction  with  the  consolidated
financial  statements,  related notes thereto and other financial data elsewhere
herein.  These historical results are not necessarily  indicative of the results
to be expected in the future.

<TABLE>
<CAPTION>

                                         (In thousands of dollars except per share amounts)
                                                        Year Ended April 30,
                          ----------------------------------------------------------------------------------
                                  2002           2001 (a)           2000          1999 (b)          1998
<S>                          <C>             <C>              <C>             <C>              <C>
                             --------------  ---------------  --------------- ---------------  -------------
Revenues                     $      83,405   $       73,209   $      119,833  $      190,291   $     171,368
Net Income                   $       3,698   $        2,557   $        1,169  $        7,537   $       8,206
Earnings Per Share -
  Basic and Diluted          $        0.56   $         0.38   $         0.16  $         1.02   $        1.11

Total Assets                 $     149,688   $      164,844   $      172,436  $      217,777   $     229,768
Notes Payable                $      16,619   $       44,260   $       46,911  $       74,665   $      84,248
Shareholders' Equity         $      93,479   $       89,781   $       91,981  $       91,577   $      84,040
Cash Dividends               $           -   $            -   $            -  $            -   $           -


--------------------------------------------------------------------------------
(a)  Includes a tax benefit in the amount of $3,500,000  (the equivalent of $.52
     per share) to reflect the settlement of 1993 and 1994 IRS tax examinations.

(b)  Includes a tax benefit in the amount of $2,400,000  (the equivalent of $.33
     per  share)  to  reflect  the  settlement  of  1990  through  1992  IRS tax
     examinations.

</TABLE>


                                       8
<PAGE>


Item 7.           Management's Discussion and Analysis of Financial
-------           -------------------------------------------------
                  Condition and Results of Operations
                  -----------------------------------
FORWARD-LOOKING STATEMENTS AND RISK FACTORS
-------------------------------------------
The Private Securities Litigation Reform Act of 1995 (the "Act") provides a safe
harbor for forward-looking  statements made by or on behalf of the Company.  The
Company  and its  representatives  may from  time to time make  written  or oral
statements that are  "forward-looking,"  including  statements contained in this
report and other  filings with the  Securities  and Exchange  Commission  and in
reports to the Company's  shareholders  and news releases.  All statements  that
express expectations,  estimates,  forecasts and projections are forward-looking
statements  within the meaning of the Act. 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 assumptions
which are  difficult  to predict.  Therefore,  actual  outcomes  and results may
differ  materially  from what is expressed or forecasted in or suggested by such
forward-looking  statements.  The Company  undertakes  no  obligation  to update
publicly any forward-looking statements, whether as a result of new information,
future events or otherwise.

A wide range of factors could materially affect the Company's future performance
and financial and competitive position,  including the following:  (i) the level
of demand  for land in Rio Rancho  and the other  markets  in which the  Company
sells land;  (ii) the  possibility  of further  adverse  changes in the magazine
distribution system for magazines which the Company  distributes,  including the
financial failure of a major wholesaler;  (iii) the existing United Magazine and
Northeast  Sort  lawsuits  described  in Item 3 of this Form  10-K and  possible
future  litigation  and  governmental  proceedings;  (iv)  the  availability  of
financing and financial  resources in the amounts, at the times and on the terms
required  to  support  the  Company's   future  business,   including   possible
acquisitions;  (v)  changes in U.S.  financial  markets,  including  significant
interest  rate  fluctuations;  (vi) the failure to carry out marketing and sales
plans; (vii) the failure to successfully  integrate  acquired business,  if any,
into the Company  without  substantial  costs,  delays or other  operational  or
financial  problems;  and (viii)  changes in economic  or  business  conditions,
including general economic and business  conditions that are less favorable than
expected.

This list of factors that may affect the Company's  future  performance  and its
financial  and  competitive  position and also the  accuracy of  forward-looking
statements  is  illustrative,  but  by no  means  exhaustive.  Accordingly,  all
forward-looking  statements  should be evaluated with the understanding of their
inherent uncertainty.

RESULTS OF OPERATIONS
---------------------
Year Ended  April 30,  2002  ("2002" ) Compared  to Year  Ended  April 30,  2001
--------------------------------------------------------------------------------
("2001")
--------
Consolidated  revenues  for the year ended  April 30,  2002 were  $83.4  million
compared to $73.2  million for the year ended April 30,  2001.  The  increase in
consolidated  revenues  in 2002 was  principally  due to an increase in revenues
from real estate operations from $21.0 million in 2001 to $30.9 million in 2002,
as well as a slight increase in revenues from magazine circulation operations.

Total revenues from magazine  circulation  operations were  approximately  $49.2
million in 2002 compared to $48.6 million in 2001. Revenues from the Fulfillment
Services  business  were  approximately  $34.0 million in 2002 compared to $34.7
million in 2001, and revenues from the Newsstand  Distribution Services business
increased  from  approximately  $13.9  million  in 2001 to  approximately  $15.2
million in 2002.  The  decrease  in  revenues in the  Fulfillment  business  was
principally  due to the loss of sweepstakes  processing work for one customer in
the first quarter of the prior year;  otherwise,  revenues in this business were
comparable on a year-to-year basis. Revenues in the Newsstand business increased
because,  although  gross  billings  declined  slightly  in line  with  industry
results,  there was an  increase  in  Kable's  net sales rate due in part to the
effects of many special event publications issued throughout the year.

                                       9
<PAGE>

Revenues  from real estate land and home sales  increased  from $21.0 million in
2001 to $30.9  million in 2002  principally  as the result of land sales in 2002
made in accordance with the Company's plan to sell its  landholdings  outside of
New Mexico.  During  2002,  two sales of large  tracts of land in  Colorado  and
California contributed aggregate revenues of $13.6 million whereas there were no
sales in these  markets in 2001.  Revenues  from land  sales in New Mexico  were
comparable  on  a  year-to-year  basis,  since  an  increase  in  revenues  from
commercial and industrial property was offset by a decrease from residential lot
sales. As a result,  total revenues from land sales increased from $16.4 million
in 2001 (with an average  gross profit  percentage  of 42%) to $30.2  million in
2002 (with an average gross profit  percentage of 24%). The average gross profit
percentage  decreased in 2002 from the prior year because the two sales of large
land tracts outside of New Mexico  contributed a significant  amount of cash but
only a very slight gross  profit.  The average  gross profit  percentage on land
sales in the  Company's  principal  market of Rio Rancho,  New Mexico was 50% in
2001 and 43% in 2002. In addition, results for 2001 include impairment and other
charges of approximately  $1.0 million  associated with land  activities,  while
there were no similar  charges in 2002.  Revenues and related gross profits from
land sales can vary from period to period as a result of many factors, including
the nature and timing of specific  transactions,  and thus prior results are not
necessarily  an  indication  of amounts  that may be expected to occur in future
periods.

The Company  completed all  homebuilding  activities  during 2002,  and realized
revenues of approximately  $600,000 (representing 3 homes delivered) compared to
$4.6 million (representing 18 homes delivered) in 2001. In addition, results for
2001  include  impairment  and  other  charges  of  approximately  $1.1  million
associated with the wind-down of homebuilding projects, while there were no such
charges in 2002.

Magazine circulation operating expenses decreased 6%, from $41.1 million in 2001
to $38.6 million in 2002, as a result of reduced bad debt expense as well as the
effects  of  a  cost  reduction  program,   including  staff  and  related  cost
reductions,  principally in the Newsstand business.  Real estate commissions and
selling expenses  decreased from $1.2 million to $1.0 million due in part to the
wind-down of homebuilding operations and the elimination of related commissions.
Real estate and corporate  general and  administrative  expenses also  decreased
from $4.1  million to $3.2  million  due to the  effects of the  Company's  real
estate restructuring and the continued  downsizing of administrative  functions.
General and administrative  costs of magazine  circulation  operations  remained
comparable  at  approximately  $6.9 million in each year.  Interest  expense-net
decreased   from  $2.8  million  to  $1.3  million  due  to  reduced   borrowing
requirements  in all segments of the  Company's  operations  and lower  interest
rates.

Revenues  associated  with  interest and other  operations  decreased  from $3.6
million  in 2001 to $3.3  million  in 2002,  principally  due to a  decrease  in
interest income resulting from a reduction in the average balance of real estate
mortgages  receivable  from land sales from year to year. In addition,  costs of
other  operations also  decreased,  from $2.8 million in 2001 to $2.6 million in
2002, due to an impairment charge of $500,000 included in 2001's results for the
estimated  loss on the sale of  property,  plant and  equipment  utilized in the
operations of the Company's utility subsidiary.

During 2001, the Company recognized a tax benefit of $3.5 million resulting from
the  resolution  of all matters  under  review by the Internal  Revenue  Service
("IRS") in connection in examinations of the Company's 1993 and 1994 tax returns
at an amount less than the Company had  previously  accrued on account  thereof.
There was no similar tax adjustment recorded in 2002.

Year Ended April 30, 2001("2001") Compared to Year Ended April 30, 2000 ("2000")
--------------------------------------------------------------------------------
Consolidated  revenues  for the year ended  April 30,  2001 were  $73.2  million
compared to $119.8  million for the year ended April 30, 2000.  The reduction in
consolidated  revenues in 2001 was principally due to the decrease in total real
estate  revenues from $62.7  million in 2000 to $21.0 million in 2001  resulting
from the effects of the previously announced restructuring of the Company's real
estate  operations,   including  the  substantial   completion  of  homebuilding
activities.

                                       10
<PAGE>

Revenues  from   homebuilding   sales  decreased  from  $30.1  million  in  2000
(representing  193 homes  delivered)  to $4.6 million in 2001  (representing  18
homes delivered) as the Company  completed  delivery of substantially  all homes
available for sale. In addition, results for 2001 and 2000 include approximately
$1.1 million and $3.2 million,  respectively,  of  impairment  and other charges
associated  with the  wind-down  of  homebuilding  projects.  There was no other
significant effect on net income resulting from the withdrawal from homebuilding
between these  periods,  however,  as the decline in  homebuilding  revenues and
related gross profits in 2001 was substantially  offset by a comparable decrease
in  homebuilding-related  commissions,  selling and  general and  administrative
expenses.

Revenues from land sales  decreased  from $32.6 million in 2000 to $16.4 million
in 2001  primarily  as a  result  of  decreased  sales  of  residential  lots to
homebuilders  in  markets  outside  of New  Mexico  as  well  as a  decrease  in
commercial and industrial property sales in New Mexico.  During 2000, as part of
a restructuring plan to sell its landholdings outside of New Mexico, the Company
closed  several  transactions  in  Colorado  at  an  aggregate  sales  price  of
approximately $10.2 million,  whereas there were no similar transactions outside
of New Mexico in 2001. In addition,  revenues  from  commercial  and  industrial
property  sales  declined  from $6.7  million in fiscal 2000 to $1.0  million in
fiscal 2001 due in part to the availability of competing  commercial  sites. The
average gross profit  percentage on land sales increased from 36% in 2000 to 42%
in 2001,  primarily  because all the  current  year land sales were from the New
Mexico market,  where gross profits have  historically been higher than in other
markets.  In  addition,  results for 2000 and 2001  include  approximately  $1.0
million  and  $.6  million,   respectively,  of  impairment  and  other  charges
associated with the restructuring of real estate operations. Land sales revenues
and  related  gross  profits  can vary from period to period as a result of many
factors,  including  the nature and timing of  specific  transactions,  and thus
prior results are not  necessarily an indication of amounts that may be expected
to occur in future periods.

Total revenues from magazine circulation operations decreased  approximately 8%,
from $52.5 million in 2000 to $48.6 million in 2001.  Revenues from  Fulfillment
Services  decreased 5%, from $36.6 million in 2000 to $34.7 million in 2001, due
primarily to the loss of sweepstakes processing business for one customer, which
was  partly  offset  by  increased  revenues  from  core  fulfillment  and other
continuing  services to other  customers.  Revenues from Newsstand  Distribution
Services  decreased  13%,  from $15.9  million in 2000 to $13.9 million in 2001,
primarily as the result of customer  losses and  decreased  magazines  sales for
existing  customers,  which reflected a continuation in 2001 of adverse business
conditions  within the  wholesaler  and  publisher  ranks that had  existed  for
several years. Industry sales decreased  approximately 7% in the 12 month period
ended December 2000, and certain  publishers,  including  clients of Kable, have
either vacated newsstand distribution or discontinued the production of a number
of titles, thus adversely affecting overall sales. In addition, Kable determined
that certain  wholesaler  and  publisher  customers  had been  impacted by these
industry changes and were encountering  financial difficulties and, accordingly,
provided  additional  allowances  for doubtful  accounts of  approximately  $2.3
million in 2001 and $1.8 million in 2000.

Magazine circulation operating expenses decreased 7%, from $44.2 million in 2000
to  $41.1  million  in  2001,  with  such  decrease  being  the  result  of  and
commensurate with lower revenues.  Real estate  commissions and selling expenses
decreased  from $3.7 million in 2000 to $1.2 million in 2001 as a direct  result
of the wind-down of homebuilding  operations.  Real estate and corporate general
and  administrative  expenses also  decreased  from $6.0 million in 2000 to $4.1
million in 2001 due to the effects of the  Company's  real estate  restructuring
and related downsizing of administrative  functions.  General and administrative
costs of magazine circulation  operations  increased  approximately 4% from $6.7
million in 2000 to $6.9  million in 2001 due to  increased  technology  staffing
costs and legal and consulting fees incurred in connection with the modification
of Kable's  credit  agreement.  Interest  expense-net  decreased  6%,  from $2.9
million  in 2000 to $2.8  million  in  2001,  as a  result  of  lower  borrowing
requirements in the real estate  business  offset in part by increased  interest
related to magazine circulation operations due to higher borrowing levels.

Revenues  associated  with  interest and other  operations  decreased  from $4.6
million  in 2000 to $3.6  million  in 2001,  principally  as the  result  of the
wind-down of an  ancillary  real estate  business  made in  connection  with the

                                       11
<PAGE>

business   restructuring   discussed  above.  Costs  of  other  operations  also
decreased,  from  $4.6  million  in  2000  to $2.8  million  in 2001  due to the
wind-down  of other  operations  as well as the  elimination  of  certain  costs
incurred  in 2000  related  to the  completion  of  certain  joint  ventures  in
California.

During 2001, the Company recognized a tax benefit of $3.5 million resulting from
the  resolution  of all matters  under  review by the Internal  Revenue  Service
("IRS") in connection in examinations of the Company's 1993 and 1994 tax returns
at an amount less than the Company had  previously  accrued on account  thereof.
There was no similar tax adjustment recorded in 2000.

LIQUIDITY AND CAPITAL RESOURCES
-------------------------------
During the past several  years,  the Company has financed  its  operations  from
internally  generated  funds from home and land sales and  magazine  circulation
operations,   and  from  borrowings   under  its  various  lines-of  credit  and
construction loan agreements.

Cash Flows From Financing Activities
------------------------------------
The  Company's  subsidiaries  have  line-of-credit   arrangements  with  several
financial  institutions  collateralized  by  various  assets  which,  based upon
collateral  availability,  amounted to an aggregate  borrowing  availability  of
$25.4 million at April 30, 2002 against which $14.0 million was borrowed.

In April 2002,  Kable entered into a loan  agreement with a bank for a revolving
line-of-credit which allows the company to borrow up to $20 million based upon a
prescribed percentage of eligible accounts receivable,  as defined. At April 30,
2002,  Kable had  borrowing  availability  of $16.2  million  against which $8.2
million was outstanding.  This line-of-credit bears interest at the bank's prime
rate plus .75%, and is  collateralized  by substantially  all of Kable's assets.
The credit  arrangement  requires  the  maintenance  or  achievement  of certain
financial  covenants  and  contains  certain  financial  restrictions,  the most
significant of which limit the amount of dividends and other repayments that may
be  made by  Kable  to its  parent  or  other  affiliates,  as  well as  capital
expenditures and other borrowings. This line of credit matures May 1, 2005.

Other  line-of-credit  borrowings  are used  principally  to support real estate
development in New Mexico. These loans are collateralized by certain real estate
assets and are subject to available collateral and various financial performance
and  other   covenants.   At  April  30,  2002,   real  estate   operations  had
lines-of-credit  totaling  $14.1  million  and  borrowing  availability  of $9.2
million against which $5.8 million was outstanding.

Notes payable outstanding,  including the lines-of-credit  discussed above, were
$16.6  million at April 30, 2002  compared to $44.3  million at April 30,  2001.
Real estate loans decreased from $13.2 million at April 30, 2001 to $8.1 million
at April 30, 2002 as the result of the  repayment of  borrowings  utilizing  the
proceeds  from  certain land sales.  Borrowings  by Kable  decreased  from $31.1
million at April 30, 2001 to $8.5 million at April 30, 2002 from the use of cash
from  several  sources,  including  beginning  of the year cash  balances,  loan
repayments from affiliates and cash generated from operations.

The Company has from time to time  reacquired  its shares to be held as treasury
stock as part of a stock  repurchase  program.  During fiscal 2000,  the Company
reacquired  143,000 of its common  shares at a cost of  approximately  $857,000.
During  fiscal 2001,  the Company  reacquired a total of  approximately  668,000
shares at an aggregate cost of approximately $4.8 million.

Cash Flows From Operating Activities
------------------------------------
Inventories  amounted  to $62.3  million  at April 30,  2002  compared  to $73.3
million  at April 30,  2001 This  change  is the net  result of a $13.0  million
decrease in inventories outside of New Mexico, where the Company is winding-down
its  activities,  and a $2.0  million  increase  in New  Mexico,  where  ongoing
projects are under development and costs are being incurred.

                                       12
<PAGE>

Receivables from magazine circulation operations decreased by approximately $2.7
million compared to the prior year primarily as the result of the timing of cash
collections.  Accounts payable increased by $6.5 million due to a combination of
factors, including the acquisition of capital equipment at the end of the fiscal
year for which payment had not been made and the timing of month-end payments.

Cash Flows From Investing Activities
------------------------------------
Capital  expenditures  have remained  comparable on a  year-to-year  basis.  The
Company  believes  that it has  adequate  financing  capability  to provide  for
anticipated capital expenditures.

The Company  has a contract  for the sale for its  utility  subsidiary  which is
scheduled to close during fiscal 2003,  subject to  regulatory  approval and the
satisfaction of other conditions.  No material gain or loss is expected upon the
sale of this  asset,  which is  included  in  Assets  Held for Sale - Net on the
balance  sheet and in Other  operations  on the  income  statement.  There is no
assurance that this sale will be concluded.

RECENT ACCOUNTING PRONOUNCEMENTS
--------------------------------
During 2001,  the  Financial  Accounting  Standards  Board  issued  Statement of
Financial Accounting Standards ("SFAS") No. 141, "Business  Combinations",  SFAS
NO. 142,  "Goodwill and Other Intangible  Assets" and SFAS No. 144,  "Accounting
for the Impairment or Disposal of Long-Lived Assets".  SFAS No. 141 requires the
purchase  method of accounting be used for all business  combinations  initiated
after June 30, 2001 and  prohibits  the use of the pooling of interests  method.
SFAS No. 142 changes the accounting for goodwill from an amortization  method to
an impairment approach.  The Company has goodwill of $5.1 million on its balance
sheet resulting from the  acquisition of Kable News Company,  Inc. which has not
been  amortized  because it arose prior to the  effective  date of the  previous
standard for goodwill accounting  (Accounting  Principles Board Opinion No. 17),
and management believes, based upon current information,  that there has been no
impairment of the value of this company.  SFAS No. 144 requires that  long-lived
assets be reviewed for impairment  whenever  events or changes in  circumstances
indicate that the carrying  amount of an asset may not be  recoverable.  It also
requires  disclosure of discontinued  operations and extends that reporting to a
component of an entity that either has been disposed of or is classified as held
for sale. The Company will be required to adopt SFAS No. 142 and SFAS No. 144 in
the first quarter of fiscal 2003, and management expects there to be no material
effect on the financial statements as a result of adoption.

SEGMENT INFORMATION
-------------------
Information  by industry  segment is  presented  in Note 13 to the  consolidated
financial statements. This information has been prepared in accordance with SFAS
No. 131,  "Disclosures about Segments of an Enterprise and Related Disclosures",
which  requires  that  industry  segment  information  be  prepared  in a manner
consistent  with the  manner in which  financial  information  is  prepared  and
evaluated by management for making operating decisions.  A number of assumptions
and  estimations are required to be made in the  determination  of segment data,
including  the need to make  certain  allocations  of common  costs and expenses
among  segments.  On an annual  basis,  management  has evaluated the basis upon
which costs are allocated,  and has periodically made revisions to these methods
of  allocation.   Accordingly,   the  determination  of  "pretax  income  (loss)
contribution"  of each  segment  as  summarized  in Note 13 to the  consolidated
financial  statements  is  presented  for  informational  purposes,  and  is not
necessarily the amount that would be reported if the segment were an independent
company.

IMPACT OF INFLATION
-------------------
Operations of the Company can be impacted by inflation. Within the industries in
which  the  Company  operates,  inflation  can  cause  increases  in the cost of
materials,  services,  interest  and  labor.  Unless  such  increased  costs are

                                       13
<PAGE>

recovered  through  increased  sales prices,  operating  margins will  decrease.
Within the land development industry, the Company encounters particular risks. A
large part of the Company's real estate sales are to homebuilders who face their
own inflationary  concerns that rising housing costs,  including interest costs,
may substantially  outpace  increases in the income of potential  purchasers and
make it  difficult  for them to finance the purchase of a new home or sell their
existing  home. If this  situation  were to exist,  the demand for the Company's
land by these homebuilder  customers could decrease. In general, in prior years,
interest and price  increases  have been  commensurate  with the general rate of
inflation in the Company's markets,  and the Company has not found the inflation
risk to be a  significant  problem in its real  estate or  magazine  circulation
operations.


Item 7(A).      Quantitative and Qualitative Disclosures About Market Risk
----------      ----------------------------------------------------------
The  primary  market  risk  facing  the  Company  is  interest  rate risk on its
long-term  debt. The Company does not hedge  interest rate risk using  financial
instruments. The Company is also subject to foreign currency risk, but this risk
is not  material.  The  following  table  sets  forth as of April  30,  2002 the
Company's long term debt  obligations by scheduled  maturity,  weighted  average
interest rate and estimated Fair Market Value ("FMV") (amounts in thousands):



                                                         There-           FMV @
                      2003   2004   2005   2006   2007   after    Total  4/30/02
                      ----   ----   ----   ----   ----   -----    -----  -------

Fixed rate debt     $  253  $  695  $ 154 $  147  $ 146  $ 1,230 $ 2,625 $ 3,080

Weighted average
   interest rate       8.2%    7.7%   8.0%   7.9%   7.9%    7.9%    7.9%      -

Variable rate debt  $ 3,130 $ 2,708 $   - $ 8,156 $   -  $     - $13,994 $13,994

Weighted average
   interest rate       4.8%    4.8%     -    5.5%     -        -    5.2%      -





                                       14
<PAGE>






Item 8. Financial Statements and Supplementary Data
------- -------------------------------------------

                    Report of Independent Public Accountants
                    ----------------------------------------

To the Shareholders
AMREP Corporation
New York, New York

We have audited the accompanying consolidated balance sheet of AMREP Corporation
and subsidiaries as of April 30, 2002 and the related consolidated statements of
income,  shareholders'  equity  and cash  flows for the year then  ended.  These
financial  statements and the schedule referred to below are the  responsibility
of the  Company's  management.  Our  responsibility  is to express an opinion on
these  financial  statements and schedule based on our audit.  The  consolidated
financial  statements of AMREP  Corporation and subsidiaries for the years ended
April 30,  2001 and 2000 were  audited by other  auditors  whose  report,  dated
August 13, 2001, expressed an unqualified opinion on those statements.

We conducted our audit in accordance with auditing standards  generally accepted
in the  United  States of  America.  Those  standards  require  that we plan and
perform the audit to obtain  reasonable  assurance  about  whether the financial
statements are free of material misstatement.  An audit includes examining, on a
test basis,  evidence  supporting  the amounts and  disclosures in the financial
statements.  An audit also includes assessing the accounting principles used and
significant  estimates  made by  management,  as well as evaluating  the overall
financial  statement  presentation.   We  believe  that  our  audit  provides  a
reasonable basis for our opinion.

In our opinion, the consolidated  financial statements referred to above present
fairly, in all material  respects,  the financial  position of AMREP Corporation
and  subsidiaries  as of April 30, 2002 and the results of their  operations and
their  cash  flows  for the  year  then  ended  in  conformity  with  accounting
principles generally accepted in the United States of America.

Our  audit  was  made  for the  purpose  of  forming  an  opinion  on the  basic
consolidated financial statements taken as a whole. Schedule II accompanying the
consolidated  financial  statements is presented for purposes of complying  with
the  Securities and Exchange  Commission's  rules and is not a part of the basic
consolidated  financial  statements.  This  schedule  has been  subjected to the
auditing  procedures  applied in our audit of the basic  consolidated  financial
statements  and, in our opinion,  is fairly  stated in all material  respects in
relation to the basic consolidated financial statements taken as a whole.



/s/McGladrey & Pullen, LLP

Davenport, Iowa
June 14, 2002



                                       15
<PAGE>



Note: The Report of Independent  Public  Accountants that follows is a copy of a
previously issued Report of Arthur Andersen LLP, Independent Public Accountants,
and it has not been reissued by Arthur  Andersen LLP. This Report was filed with
the Form 10-K/A  (Amendment No. 1) of AMREP Corporation for the year ended April
30, 2001,  and the consent of Arthur  Andersen LLP,  dated August 13, 2001,  was
filed as an exhibit to the Form 10-K/A,  consenting to the incorporation of this
Report  in the  previously  filed  Registration  Statements  of  Form  S-8  nos.
33-67114,  33-67116 and  333-17695.  The  Registrant has been unable to obtain a
reissued  Report of Arthur  Andersen  LLP or a  currently  dated  consent to the
incorporation  of this previously  issued Report of Arthur Andersen LLP into the
Registration  Statements  on  Form  S-8.  While  the  extent  of  any  resulting
limitations on recovery by investors is unclear,  the lack of a currently  dated
consent could limit the time within which any such actions by investors  against
Arthur Andersen LLP for  liabilities  arising under Section 11 of the Securities
Act of 1933 must be brought.



                    Report of Independent Public Accountants
                    ----------------------------------------



To AMREP Corporation:


We  have  audited  the  accompanying   consolidated   balance  sheets  of  AMREP
Corporation (an Oklahoma  corporation) and subsidiaries as of April 30, 2001 and
2000, and the related  consolidated  statements of income,  shareholders' equity
and cash flows for each of the three years in the period  ended April 30,  2001.
These  financial   statements  and  the  schedule  referred  to  below  are  the
responsibility of the Company's management.  Our responsibility is to express an
opinion on these financial statements and schedule based on our audits.

We conducted our audits in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the audit
to obtain reasonable  assurance about whether the financial  statements are free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting  the amounts and  disclosures in the financial  statements.  An audit
also includes assessing the accounting principles used and significant estimates
made by  management,  as well as  evaluating  the  overall  financial  statement
presentation.  We believe  that our audits  provide a  reasonable  basis for our
opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all  material  respects,   the  financial  position  of  AMREP  Corporation  and
subsidiaries as of April 30, 2001 and 2000, and the results of their  operations
and their cash flows for each of the three  years in the period  ended April 30,
2001 in conformity with accounting  principles  generally accepted in the United
States.

Our  audits  were  made for the  purpose  of  forming  an  opinion  on the basic
financial statements taken as a whole. Schedule II accompanying the consolidated
financial  statements  is  presented  for the  purpose  of  complying  with  the
Securities  and  Exchange  Commission's  rules  and is  not  part  of the  basic
financial  statements.   This  schedule  has  been  subjected  to  the  auditing
procedures  applied in our audits of the basic financial  statements and, in our
opinion,  fairly states in all material  respects the financial data required to
be set forth therein in relation to the basic  financial  statements  taken as a
whole.


                                                          /s/ARTHUR ANDERSEN LLP

Albuquerque, New Mexico
August 13, 2001


                                       16
<PAGE>




                       AMREP CORPORATION AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                             APRIL 30, 2002 AND 2001
                          (Dollar amounts in thousands)

                    ASSETS                          2002              2001
                    ------                      ----------        ----------

CASH AND CASH EQUIVALENTS                       $  15,744         $  15,941

RECEIVABLES, net:
   Real estate operations                           6,630             7,070
   Magazine circulation operations                 34,849            37,533
                                                ----------        ----------
                                                   41,479            44,603

REAL ESTATE INVENTORY                              62,296            73,347

PROPERTY, PLANT AND EQUIPMENT,
   at historical cost, net of accumulated
   depreciation and amortization                    9,890            14,314


ASSETS HELD FOR SALE- NET                           5,853                 -

OTHER ASSETS, net of accumulated amortization       9,235            11,448


EXCESS OF COST OF SUBSIDIARY
   OVER NET ASSETS ACQUIRED                         5,191             5,191
                                                ----------        ----------
    TOTAL ASSETS                                $ 149,688         $ 164,844
                                                ==========        ==========

                      LIABILITIES AND SHAREHOLDERS' EQUITY
                      ------------------------------------
ACCOUNTS PAYABLE AND ACCRUED EXPENSES           $  33,867         $  27,326

NOTES PAYABLE:
   Amounts due within one year                      3,383             9,490
   Amounts subsequently due                        13,236            34,770
                                                ----------        ----------
                                                   16,619            44,260

TAXES PAYABLE                                       1,127             1,595


DEFERRED INCOME TAXES                               4,596             1,882
                                                ----------        ----------
     TOTAL LIABILITIES                             56,209            75,063
                                                ----------        ----------

COMMITMENTS AND CONTINGENCIES  (Notes 10 and 11)

SHAREHOLDERS' EQUITY:
 Common stock, $.10 par value;
  shares authorized--20,000,000;
  shares issued - 7,399,704                           740               740
 Capital contributed in excess of par value        44,935            44,935
 Retained earnings                                 53,513            49,815
 Treasury stock, at cost; 826,092 share            (5,709)           (5,709)
                                                ----------        ----------
     TOTAL SHAREHOLDERS' EQUITY                    93,479            89,781
                                                ----------        ----------

     TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 149,688         $ 164,844
                                                ==========        ==========


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

                                       17
<PAGE>


<TABLE>
<CAPTION>

                       AMREP CORPORATION AND SUBSIDIARIES
                        CONSOLIDATED STATEMENTS OF INCOME
                (Amounts in thousands, except per share amounts)

                                                         Year Ended April 30,
                                            --------------------------------------------
<S>                                        <C>              <C>              <C>
                                                 2002             2001            2000
                                           ------------     ------------     ------------
   REVENUES:
      Magazine circulation operations       $   49,248       $   48,570       $   52,548

      Real estate operations-
        Land sales                              30,228           16,386           32,637
        Home  sales                                635            4,611           30,079
                                           ------------     ------------     ------------
                                                30,863           20,997           62,716

      Interest and other operations              3,294            3,642            4,569
                                           ------------     ------------     ------------

                                                83,405           73,209          119,833
                                           ------------     ------------     ------------

   COSTS AND EXPENSES:
      Operating expenses-
        Magazine circulation operations         38,643           41,128           44,184
        Real estate commissions and selling        978            1,218            3,670
        Other operations                         2,635            2,836            4,560
      Real estate cost of sales-
        Land sales                              22,894            9,588           21,084
        Home sales                                 704            6,083           28,735
      General and administrative-
        Magazine circulation operations          6,914            6,934            6,680
        Real estate operations and corporate     3,209            4,121            6,026
      Interest, net                              1,265            2,771            2,946
                                           ------------     ------------     ------------
                                                77,242           74,679          117,885
                                           ------------     ------------     ------------

   INCOME (LOSS) BEFORE INCOME TAXES             6,163           (1,470)           1,948

   PROVISION (BENEFIT) FOR INCOME TAXES          2,465           (4,027)             779
                                           ------------     ------------     ------------
   NET INCOME                               $    3,698       $    2,557       $    1,169
                                           ============     ============     ============


   EARNINGS PER SHARE - BASIC AND DILUTED  $       .56       $      .38       $      .16
                                           ============     ============     ============

   WEIGHTED AVERAGE NUMBER OF COMMON
      SHARES OUTSTANDING                         6,574            6,681            7,285
                                           ============     ============     ============


       The accompanying notes to consolidated financial statements are an
                 integral part of these consolidated statements.
</TABLE>



                                       18
<PAGE>




<TABLE>
<CAPTION>


                       AMREP CORPORATION AND SUBSIDIARIES
                 CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
                             (Amounts in thousands)

                                                             Capital
                                                           Contributed
                                             Common Stock   In Excess                 Treasury
                                                               of         Retained    Stock at
                                           Shares  Amount   Par Value     Earnings      Cost        Total
                                           ------  ------  ------------   --------   ----------   --------

<S>                                        <C>     <C>     <C>            <C>        <C>          <C>


BALANCE, April 30, 1999                     7,399  $  740  $    44,928    $ 46,089   $    (180)   $ 91,577

   Net income                                   -       -            -       1,169           -       1,169

   Purchase of treasury stock                   -       -            -           -        (857)       (857)

   Issuance of treasury stock                   -       -            2           -          90          92
                                           ------  ------  ------------   --------   ----------   --------
BALANCE, April 30, 2000                     7,399     740       44,930      47,258        (947)     91,981

   Net income                                   -       -            -       2,557           -       2,557

   Purchase of treasury stock                   -       -            -           -      (4,762)     (4,762)

   Exercise of stock options                    1       -            5           -           -           5
                                           ------  ------  ------------   --------   ----------   --------
BALANCE, April 30, 2001                     7,400  $  740  $    44,935    $ 49,815   $  (5,709)   $ 89,781

   Net income                                   -       -            -       3,698           -       3,698
                                           ------  ------  ------------   --------   ----------   --------

BALANCE, April 30, 2002                     7,400  $  740  $    44,935    $ 53,513   $  (5,709)   $ 93,479
                                           ======  ======  ============   ========   ==========   ========

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

</TABLE>


                                       19
<PAGE>


<TABLE>
<CAPTION>

                       AMREP CORPORATION AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                             (Amounts in thousands)

<S>                                                         <C>          <C>         <C>
                                                                      Year Ended April 30,
                                                            ------------------------------------
                                                                 2002         2001       2000
                                                            ----------   ----------  ----------

CASH FLOWS FROM OPERATING ACTIVITIES:
   Net income                                               $   3,698    $   2,557   $   1,169
   Adjustments to reconcile net income
     to net cash provided by operating activities-
     Depreciation and amortization                              2,691        3,033       4,104
     Non-cash credits and charges:
       Loss (gain) on disposition of fixed assets                   -         (211)        167
       Provision for doubtful accounts                            491        2,265       1,806
       Impairment of long-lived assets                              -        2,256       4,543
       Pension benefit accrual                                   (511)        (603)       (573)
       Issuance of treasury stock charged to expense             -            -             92
     Changes in assets and liabilities,
      excluding the effect of acquisition-
       Receivables                                              2,465        7,606       8,388
       Real estate inventory                                   11,051       (2,085)     19,164
       Other real estate investments                                -            -       1,089
       Other assets                                             1,527         (634)      1,145
       Accounts payable and accrued expenses                    6,685        1,406     (11,708)
       Taxes payable                                             (468)      (3,402)     (9,341)
       Deferred income taxes                                    2,714         (745)      1,612
                                                            ----------   ----------  ----------
         Net cash provided by operating activities             30,343       11,443      21,657
                                                            ----------   ----------  ----------
CASH FLOWS FROM INVESTING ACTIVITIES:
   Capital expenditures                                        (2,899)      (2,045)     (2,659)
   Proceeds from disposition of property, plant and equipment       -        1,017         227
   Amount received upon acquisition                                 -            -         873
                                                            ----------   ----------  ----------
         Net cash used by investing activities                 (2,899)      (1,028)     (1,559)
                                                            ----------   ----------  ----------

CASH FLOWS FROM FINANCING ACTIVITIES:
   Proceeds from debt financing                                14,582       24,843      25,424
   Principal debt payments                                    (42,223)     (27,494)    (55,284)
   Exercise of stock option                                         -            5           -
   Purchase of treasury stock                                       -       (4,762)       (857)
                                                            ----------   ----------  ----------
         Net cash used by financing activities                (27,641)      (7,408)    (30,717)
                                                            ----------   ----------  ----------

INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS                 (197)       3,007     (10,619)
CASH AND CASH EQUIVALENTS, beginning of year                   15,941       12,934      23,553
                                                            ----------   ----------  ----------
CASH AND CASH EQUIVALENTS, end of year                       $ 15,744     $ 15,941    $ 12,934
                                                            ==========   ==========  ==========

SUPPLEMENTAL CASH FLOW INFORMATION:
   Interest paid - net of amounts capitalized                $  2,032     $  4,354    $  3,759
                                                            ==========   ==========  ==========
   Income taxes paid - net of refunds                        $    219     $    100    $  8,363
                                                            ==========   ==========  ==========
   Non-Cash Transaction
     Transfer to Inventory from Fixed Assets                 $      -     $    317    $      -
                                                            ==========   ==========  ==========
   Acquisition of real estate assets:
     Identifiable assets acquired                            $      -     $      -    $  1,408
     Liabilities assumed                                            -            -       2,281
                                                            ----------   ----------  ----------
         Net cash (received) paid for acquisition            $      -     $      -    $   (873)
                                                            ==========   ==========  ==========


       The accompanying notes to consolidated financial statements are an
                 integral part of these consolidated statements.
</TABLE>

                                       20
<PAGE>


                       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 (individually and collectively, as
the context  requires,  the  "Company").  The  Company,  through  its  principal
subsidiaries,  is engaged in two unrelated businesses.  Kable News Company, Inc.
("Kable")  operates  in  the  magazine  distribution  and  fulfillment  services
industries,  and AMREP Southwest Inc. operates  predominately in the real estate
industry,  principally in New Mexico. 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.

         Revenue recognition
         -------------------
Revenues  from  magazine  circulation   operations  include  revenues  from  the
distribution   of   periodicals   and   subscription   fulfillment   activities.
Distribution  revenues  represent  commissions  earned from the  distribution of
publications  for  client   publishers  which  are  recorded  at  the  time  the
publications  go on  sale.  The  publications  generally  are  sold  on a  fully
returnable  basis,  which  is in  accordance  with  prevailing  trade  practice.
Accordingly,  the Company  provides for  estimated  returns by charges to income
which are based on experience. Revenues from subscription fulfillment activities
represent  fees earned from the  maintenance  of computer  files for  customers,
which are billed and earned monthly, and other fulfillment  activities including
customer telephone support, product fulfillment, and graphic arts and lettershop
services, all of which are billed and earned as the services are provided.

Land sales are recognized when all elements of Statement of Financial Accounting
Standards  ("SFAS")  No. 66,  "Accounting  for Sales of Real  Estate",  are met,
including  when  the  parties  are  bound  by the  terms  of the  contract,  all
consideration  (including  adequate cash) has been exchanged and title and other
attributes  of ownership  have been conveyed to the buyer by means of a closing.
Profit is recorded either in its entirety or on the installment method depending
upon,  among other  things,  the ability to estimate the  collectibility  of the
unpaid  sales  price.  In the event the buyer  defaults on the  obligation,  the
property  is taken back and  recorded  as  inventory  at the  unpaid  receivable
balance, net of any deferred profit, but not in excess of fair market value less
estimated costs to sell.

Sales of homes are recognized when title and other  attributes of ownership have
been conveyed to the buyer by means of a closing.

         Cash and cash equivalents
         -------------------------
Cash equivalents  consist of short term, highly liquid investments which have an
original maturity of ninety days or less, and that are readily  convertible into
cash.



                                       21
<PAGE>


         Real estate inventory
         ---------------------
Land and improvements for completed real estate projects,  as well as those held
for future  development  or sale,  are stated at the lower of  accumulated  cost
(except in certain  instances  where property is repossessed as discussed  above
under  "Revenue  recognition")  which  includes the  development  cost,  certain
amenities,  capitalized  interest and  capitalized  real estate  taxes,  or fair
market value less estimated costs to sell.

         Property, plant and equipment
         -----------------------------
Items capitalized as part of property, plant and equipment are recorded at cost.
Expenditures  for  maintenance  and repair  and minor  renewals  are  charged to
expense as incurred, while those expenditures which improve or extend the useful
life of  existing  assets are  capitalized.  Upon sale or other  disposition  of
assets, their cost and the related accumulated  depreciation or amortization are
removed from the accounts and the  resulting  gain or loss, if any, is reflected
in operations.

Depreciation  and  amortization  of property,  plant and  equipment are 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
range from 3 to 40 years.  Assets  utilized  in the  Company's  utility  company
subsidiary,  which is under contract for sale and classified as "Assets Held for
Sale-Net", are depreciated over 5 to 50 years.

         Excess of cost of subsidiaries over net assets acquired
         -------------------------------------------------------
The excess of amounts paid for business  acquisitions over the net fair value of
the assets acquired and liabilities assumed ("goodwill") is carried as an asset.
Goodwill arose in connection  with the  acquisition of Kable during 1969 and has
not been amortized to operations,  since this  acquisition was made prior to the
effective  date of  Accounting  Principles  Board  Opinion  ("APB")  No.  17 and
management is of the opinion that there has been no diminution of value.

         Long-lived assets
         -----------------
Long-lived assets,  including real estate inventory and goodwill,  are evaluated
when  indicators of impairment are present.  Provisions for possible  losses are
recorded when  undiscounted cash flows estimated to be generated by those assets
are less than the assets' carrying amount. See Notes 3 and 4.

         Income taxes
         ------------
Deferred tax assets and liabilities are determined based on differences  between
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.

         Earnings per share
         ------------------
Basic  earnings  per  share is based on the  weighted  average  number of common
shares  outstanding  during each year.  Diluted  earnings  per share is computed
assuming  the  issuance  of  common  shares  for  all  dilutive   stock  options
outstanding (using the treasury stock method) during the reporting period.


         Stock options
         -------------
The Company  accounts for stock  option  grants in  accordance  with APB No. 25,
"Accounting  for  Stock  Issued to  Employees."  The  Company  has  adopted  the
disclosure-only   provisions  of  SFAS  No.  123,  "Accounting  for  Stock-Based
Compensation" (see Note 7).


                                       22
<PAGE>

         Comprehensive income
         --------------------
The Company is  required  to report  components  of  comprehensive  income in an
annual  financial  statement that is displayed with the same prominence as other
financial statements.  The Company's comprehensive income and net income are the
same.

         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. The significant  estimates that
affect the  financial  statements  include,  but are not limited  to,  inventory
valuation,   magazine  returns,  the  recoverability  of  long-term  assets  and
amortization periods. Actual results could differ from those estimates.

         New accounting pronouncements
         -----------------------------
In June 2001, the Financial Accounting Standards Board ("FASB") issued Statement
of Financial  Accounting  Standards  ("SFAS") No. 141,  "Business  Combinations"
("SFAS No. 141") which  requires that the purchase  method of accounting be used
for all business  combinations  initiated  after June 30, 2001 and prohibits the
use of the pooling of  interests  method.  The Company has made no  acquisitions
subsequent to June 30, 2001.

In June 2001,  the FASB  issued  SFAS No. 142,  "Goodwill  and Other  Intangible
Assets  ("SFAS No. 142") which  changes the  accounting  for  goodwill  from  an
amortization method to an impairment  approach.  The Company will be required to
adopt SFAS No. 142 in the first  quarter of the  fiscal  year  beginning  May 1,
2002.  The  impairment  test  compares  the fair  value of a  business  with its
carrying amount (including goodwill). Based upon current information, management
believes there has been no impairment of the carrying  amount of Kable and, as a
result,  management  expects there to be no effect on the financial  position or
results of operations of the Company.

In October 2001, the FASB issued SFAS No. 144, "Accounting for the Impairment or
Disposal of  Long-Lived  Assets)  ("SFAS No.  144").  SFAS No. 144 requires that
long-lived  assets be  reviewed  for  impairment  whenever  events or changes in
circumstances  indicate  that  the  carrying  amount  of an  asset  may  not  be
recoverable.  It also  requires  companies  to  separately  report  discontinued
operations  and extends  that  reporting to a component of an entity that either
has been disposed of or is classified as held for sale. Assets to be disposed of
are  reported  at the lower of the  carrying  amount or fair value less costs to
sell. The Company will be required to adopt SFAS No. 144 in the first quarter of
the fiscal  year  beginning  May 1, 2002,  and  expects  there to be no material
effect on the financial statements.

         Financial statement presentation
         --------------------------------
Certain prior year amounts in the  consolidated  financial  statements have been
reclassified to conform with the 2002 presentation with no effects on net income
or shareholders' equity.





                                       23
<PAGE>



(2)      RECEIVABLES:
         ------------
Receivables consist of:                                    April 30,
                                               ---------------------------------
                                                   2002               2001
                                               --------------     --------------
                                                         (Thousands)
Real estate operations-
   Mortgage and other receivables              $     6,883        $       7,243
   Allowance for doubtful accounts                    (253)                (173)
                                               --------------     --------------
                                               $     6,630        $       7,070
                                               ==============     ==============

Magazine circulation operations-
   Accounts receivable (maturing
    within one year)                           $    92,760        $      87,946
   Allowances for-
     Estimated returns                             (56,803)             (49,201)
     Doubtful accounts                              (1,108)              (1,212)
                                               --------------     --------------
                                               $    34,849        $      37,533
                                               ==============     ==============


Mortgage and other receivables bear interest at rates ranging from 8.0% to 11.0%
and  result  primarily  from  land  sales.   Magazine   circulation   operations
receivables  collateralize  a general  purpose  line-of-credit  utilized for the
magazine circulation operations (see Note 6).

The Company extends credit to various  companies in the real estate and magazine
circulation  industries  which may be  affected  by changes in economic or other
external  conditions.  Financial  instruments  that may potentially  subject the
Company  to a  significant  concentration  of risk  primarily  consist  of trade
accounts receivable from wholesalers in the magazine  distribution  industry. As
industry  practices  allow,  the  Company's  policy is to manage its exposure to
credit risk through credit  approvals and limits and, where  appropriate,  to be
secured by  collateral.  The Company  also  provides an  allowance  for doubtful
accounts for potential losses based upon factors  surrounding the credit risk of
specific  customers,  historical  trends and other  financial and  non-financial
information.  In  recent  years,  as a result of  changes  within  the  magazine
distribution  industry there has been a major consolidation and reduction in the
number of wholesalers to whom Kable  distributes  magazines and, as a result, at
April 30, 2002  approximately  62% of Kable's accounts  receivable were due from
three customers.

Kable  performs  fulfillment  services  and  purchases  magazines  for resale to
wholesalers from publishing companies owned or controlled by a major shareholder
and member of the Board of Directors.  Commissions  and other revenues earned on
these  transactions  represent  approximately  3%,  3%  and  2% of  consolidated
revenues in 2002, 2001 and 2000, respectively.

Maturities  of  principal  on real estate  receivables  at April 30, 2002 are as
follows (in thousands):  2003 - $4,482;  2004 - $961; 2005 - $1,137;  2006 - $4;
2007 - $6; and thereafter - $293.

(3)      REAL ESTATE INVENTORY:
         ----------------------
Real estate inventory consists of:
                                                            April 30,
                                               ---------------------------------
                                                    2002                2001
                                               --------------     --------------
                                                           (Thousands)

Land and improvements held for sale
 or development                                $   62,296          $   72,654
Homes and condominiums -
 land and construction costs                            -                 693
                                               --------------     --------------
                                               $   62,296          $   73,347
                                               ==============     ==============


Accumulated  capitalized  interest  costs  included in real estate  inventory at
April 30, 2002 and 2001 were $4,017,000 and $4,946,000,  respectively.  Interest
costs  capitalized  during 2002,  2001 and 2000 were $767,000,  $1,533,000,  and



                                       24
<PAGE>

$1,371,000, respectively.  Accumulated capitalized real estate taxes included in
the  inventory  of land and  improvements  at  April  30,  2002  and  2001  were
$5,184,000 and $5,519,000,  respectively.  Real estate taxes capitalized  during
2002,  2001  and  2000  were  $72,000,  $425,000  and  $182,000,   respectively.
Previously  capitalized  interest  costs and real estate  taxes  charged to real
estate cost of sales were $2,103,000, $775,000, and $2,375,000 in 2002, 2001 and
2000, respectively.

During 2001 and 2000,  the Company  determined  that certain real estate  assets
were impaired  primarily due to conditions  associated with the restructuring of
real estate  operations.  The Company  recognized an impairment  for  long-lived
assets of approximately  $1,750,000 in 2001 and $3,800,000 in 2000 based upon an
estimate of the future cash flows to be generated  by those  assets  compared to
the remaining  carrying value of those assets. No impairment charge was recorded
in 2002.

Substantially all of the Company's real estate assets are located in New Mexico.
As a result of this geographic  concentration,  the Company could be affected by
economic conditions in this region.


(4)      PROPERTY, PLANT AND EQUIPMENT:
         ------------------------------
Property, plant and equipment consists of:
                                                          April 30,
                                               ---------------------------------
                                                    2002               2001
                                               --------------     --------------
                                                         (Thousands)

Land, buildings and improvements               $    9,574         $    9,588
Furniture and fixtures                             14,663             12,170
Utility plant and equipment                             -              7,706
Other                                                 152                136
                                               --------------     --------------
                                                   24,389             29,600
Accumulated depreciation and
   amortization                                   (14,499)           (15,286)
                                               --------------     --------------
                                               $    9,890         $   14,314
                                               ==============     ==============


The  Company  has a  contract  for  sale  for its  utility  subsidiary  which is
scheduled to close during fiscal 2003,  subject to  regulatory  approval and the
satisfaction of other conditions.  No material gain or loss is expected upon the
sale of this  asset,  which is  included  in  Assets  Held for Sale - Net on the
balance  sheet and in Other  operations  on the income  statement.  At April 30,
2002, Assets Held for Sale - Net consists of the following:  Accounts receivable
($168,000),   Property,  plant  and  equipment  ($5,571,000)  and  Other  assets
($258,000) net of Accounts payable, and accrued expenses ($144,000). There is no
assurance that this sale will be concluded.

During  2001,  the Company  provided an  impairment  reserve of $500,000 for the
estimated  loss on the sale of  property,  plant and  equipment  utilized in the
operations of the utility  subsidiary.  During 2000, the Company determined that
certain  property  and  specialized   equipment   utilized  in  its  fulfillment
operations  would no longer be  utilized  due to the  impending  loss of a large
customer,  and the Company  recognized an impairment  for  long-lived  assets of
approximately  $735,000  based upon an  estimate  of the future cash flows to be
generated  by those assets  compared to the  remaining  carrying  value of those
assets. No impairment charge was recorded in 2002.

Depreciation  charged to  operations  amounted  to  $1,752,000,  $1,807,000  and
$2,230,000, in 2002, 2001 and 2000, respectively.



                                       25
<PAGE>


(5)      OTHER ASSETS:
         -------------
Other assets consist of:
                                                            April 30,
                                                 -------------------------------
                                                     2002               2001
                                                 --------------    -------------
                                                          (Thousands)

Prepaid expenses and other deferred charges, net  $   4,922         $    5,118
Purchased magazine distribution contracts,
   net of accumulated amortization of $3,744 and
   $3,316 in 2002 and 2001, respectively                535                963
Security and other deposits                             379              2,635
Prepaid pension (Note 7)                              3,134              2,623
Other                                                   265                109
                                                 --------------    -------------
                                                  $   9,235         $   11,448
                                                 ==============    =============


Amortization  related  to  deferred  charges  and  distribution   contracts  was
$939,000, $1,226,000 and $1,874,000 in 2002, 2001 and 2000, respectively.


(6)      DEBT FINANCING:
         ---------------
Debt financing consists of:
                                                          April 30,
                                               -------------------------------
                                                    2002               2001
                                               ------------       ------------
                                                         (Thousands)
Notes payable -
   Line-of-credit borrowings -
     Real estate operations and other           $   5,839          $   7,758
     Magazine circulation operations                8,156             29,975
   Mortgages and other notes payable                2,624              6,527
                                               ------------       -------------
                                                $  16,619           $ 44,260
                                               ============       =============

Maturities  of principal on notes  outstanding  at April 30, 2002 are as follows
(in thousands): 2003 - $3,383; 2004 - $3,403; 2005 - $154; 2006 - $8,303; 2007 -
$146; 2008 and thereafter - $1,230.


         Line-of-credit borrowings
         -------------------------
The Company has several  loans with one  financial  institution  to support real
estate  operations.  These  loans  have a  total  maximum  amount  available  of
approximately  $14.1 million subject to a borrowing base determined based upon a
prescribed  percentage of eligible inventory and accounts  receivable.  At April
30, 2002, the Company had borrowing  availability  of $9.2 million against which
$5.8 million was outstanding.  These borrowings, which mature in fiscal 2003 and
2004,  bear  interest  at  the  prime  rate  (4.75%  at  April  30,  2002),  are
collateralized  by  certain  real  estate  assets  and are  subject  to  certain
financial  performance and other covenants.  The Chief Executive  Officer of the
real estate  subsidiary,  who is also a member of the Board of  Directors of the
Company,  serves  as a  member  of the  board  of  directors  of  the  financial
institution from which these loans were obtained.

In April 2002,  Kable entered into an agreement with a bank for a line of credit
which  allows the  Company to borrow up to $20 million  based upon a  prescribed
percentage of eligible accounts receivable,  as defined. This credit arrangement
replaced a similar borrowing  arrangement with a group of banks in the amount of

                                       26
<PAGE>

$23.5  million  that was due to expire on May 1, 2002.  At April 30,  2002,  the
Company had borrowing  availability of approximately $16.2 million against which
$8.2 million was  outstanding.  This line of credit bears interest at the bank's
prime  rate  (4.75% at April 30,  2002)  plus  .75%,  and is  collateralized  by
substantially  all the Company's  assets.  The credit  arrangement  requires the
maintenance or achievement of certain  financial  covenants and contains certain
financial  restrictions,  the most  significant  of which  limit  the  amount of
dividends  and other  payments  that may be made by Kable to its Parent or other
affiliates,  as well as capital expenditures and other borrowings.  This line of
credit matures May 1, 2005.


         Mortgages and other notes payable
         ---------------------------------
Mortgages and other notes payable had interest rates ranging from 6.4% to 10% at
April  30,  2002,  and are  primarily  collateralized  by  property,  plant  and
equipment and certain land  inventory.  These  borrowings  mature through fiscal
2013.


(7)      BENEFIT PLANS:
         --------------
         Retirement plan
         ---------------
The Company has a  retirement  plan which  covers  substantially  all  full-time
employees and which provides  benefits based upon a percentage of the employee's
annual salary.  No contribution to the plan was required in 2002, 2001 and 2000.
Assets are  invested  primarily  in equity and debt  securities,  United  States
Treasury obligations and money market funds.

Net periodic  pension cost (income) for 2002, 2001 and 2000 was comprised of the
following components:
<TABLE>
<CAPTION>

                                                                   Year Ended April 30,
                                                  -------------------------------------------------------
                                                       2002                2001                2000
                                                  ---------------    ------------------    --------------
                                                                        (Thousands)
<S>                                               <C>                <C>                  <C>
Service cost - benefits earned during the
   period                                         $          556     $          571       $          656
Interest cost on projected
   benefit obligation                                      1,766              1,738                1,611
Expected return on assets                                 (2,481)            (2,560)              (2,464)
Amortization of prior service cost                          (352)              (352)                (352)
Recognized net actuarial loss                                  -                  -                  (24)
                                                  ---------------    -----------------    ---------------
Net periodic pension cost (income)                $         (511)    $         (603)      $         (573)
                                                  ===============    =================    ===============

Assumptions used in determining net periodic pension cost were:

                                                                   Year Ended April 30,
                                                -----------------------------------------------------------
                                                      2002                 2001                 2000
                                                -----------------    -----------------    -----------------

Discount rates                                       7.25%                 7.5%                  7.25%
Rates of increase in compensation
   levels                                             4.5%                 4.5%                   4.5%
Expected long-term rate of return
   on assets                                          9.0%                 9.0%                   9.0%


</TABLE>

                                       27
<PAGE>


The following  table sets forth changes in the plan's  benefit  obligations  and
assets,  and  summarizes  components  of  amounts  recognized  in the  Company's
consolidated balance sheets:

                                                          April 30,
                                               -------------------------------
                                                    2002             2001
                                               -------------    --------------
                                                         (Thousands)

Change in benefit obligations:
  Benefit obligation at beginning of year        $  24,621        $  21,437
  Service cost (excluding expense component)           433              441
  Interest cost                                      1,766            1,738
  Actuarial (gain) loss                                651            2,749
  Benefits paid                                     (1,638)          (1,744)
                                               -------------    --------------
  Benefit obligation at end of year              $  25,833        $  24,621
                                               =============    ==============

Change in plan assets:
  Fair value of plan assets at
    beginning of year                            $  28,411        $  29,240
  Actual return on plan assets                         (98)           1,052
  Employer contribution                                  -                -
  Benefits paid                                     (1,638)          (1,744)
  Expenses                                            (117)            (137)
                                               -------------    --------------
  Fair value of plan assets at end of year       $  26,558        $  28,411
                                               =============    ==============

Funded status                                    $     725        $   3,790
Unrecognized net actuarial (gain) loss               4,740            1,516
Unrecognized prior service cost                     (2,331)          (2,683)
                                               -------------    --------------
Prepaid pension cost                             $   3,134        $   2,623
                                               =============    ==============


         Savings plan
         ------------
The Company has a savings  plan to which the Company  makes  contributions.  The
plan provides for standard contributions of 33.3% of eligible employees defined
contributions up to a maximum of 2% of such employees' compensation.  Additional
amounts  may be  contributed  with  the  approval  of  the  Companys  Board  of
Directors.  The Company's  contribution  to the plan  amounted to  approximately
$230,000, $252,000 and $254,000 in 2002, 2001 and 2000, respectively.

         Stock option plans
         ------------------
Under the  Company's  1992 Stock Option Plan,  311,750  shares were reserved for
issuance  to  officers  and other key  employees  at April 30,  2002.  This plan
expires on June 30,  2002.  The  Non-Employee  Directors  Option Plan has 34,000
shares  reserved for issuance and provides for an automatic  issuance of options
to purchase 500 shares of common stock to each non-employee director annually at
the fair market value at the date of grant.  The options are  exercisable in one
year and expire five years after the date of grant.




                                       28
<PAGE>



<TABLE>
<CAPTION>
 A summary of activity in the Company's stock option plans is as follows:


                                                                   Year Ended April 30,
                              ------------------------------------------------------------------------------
                                            2002                         2001                        2000
                              ------------------------------- ---------------------------------- -----------
<S>                                   <C>       <C>         <C>           <C>          <C>        <C>
                                               Weighted                  Weighted                 Weighted
                                     Number    Average      Number        Average      Number     Average
                                      of       Exercise      of          Exercise       of        Exercise
                                     Shares      Price      Shares         Price       Shares      Price

Options outstanding at
  beginning of year                   12,000    $ 6.30      12,000        $ 6.27       43,500     $ 6.20

Granted                                3,000      3.95       2,500          5.88        2,500       5.84
Exercised                                  -                (1,000)         5.53            -
Expired or canceled                   (2,000)     5.19      (1,500)         5.88      (34,000)      7.50
                              -----------------          -------------               -----------
Options outstanding at
  end of year                         13,000      5.92      12,000          6.30       12,000       6.27
                              =================          =============               ===========

Available for grant at
  end of year                        332,750               335,750                    337,750
                              =================          =============               ===========
Options exercisable at
  end of year                         10,000                 9,500                      9,500
                              =================          =============               ===========
Range of exercise prices
  for options exercisable
  at end of year                $3.95 to $7.75           $5.19 to $7.75              $5.19 to $7.75
                              =================          ==============              ==============

</TABLE>

Options  outstanding at April 30, 2002 are  exercisable  over a four year period
beginning  one  year  from  date  of  grant.  The  weighted  average   remaining
contractual  life of options  outstanding  at April 30, 2002,  2001 and 2000 are
2.5, 3.1 and 3.1 years, respectively. The weighted average fair value of options
granted  during the year was $1.36 in 2002,  $1.08 in 2001 and $.97 in 2000. The
fair value of each  option  grant is  estimated  on the date of grant  using the
Black-Scholes   option-pricing   model  with  the   following   weighted-average
assumptions  used for  grants  in 2002,  2001 and 2000,  respectively:  expected
volatility of 46%, 34% and 41%, risk-free interest rates of 3.3%, 4.4% and 6.6%,
and expected lives of 3 years.

Stock options granted have been issued with an exercise price at the fair market
value of the Company's stock at the date of grant. Accordingly,  no compensation
expense has been recognized with respect to the stock option plans. Further, the
amount  of  additional   compensation   disclosable  under  the  disclosure-only
provisions of SFAS No. 123 is immaterial for all periods presented.


                                       29
<PAGE>






(8)     INCOME TAXES:
        -------------
The provision (benefit) for income taxes consists of the following:
                                               Year Ended April 30,
                                     -----------------------------------------
                                         2002          2001           2000
                                     -----------   ------------   ------------
                                                   (Thousands)
Current:
   Federal                           $     (76)    $    (3,290)   $    (833)
   State and local                        (173)              8            -
                                     -----------   ------------   ------------
                                          (249)         (3,282)        (833)
                                     -----------   ------------   ------------
Deferred:
   Federal                               2,317            (847)       1,341
   State and local                         397             102          271
                                     -----------   ------------   ------------
                                         2,714            (745)       1,612
                                     -----------   ------------   ------------
Total provision (benefit)
 for income taxes                    $   2,465     $    (4,027)   $     779
                                     ===========   ============   ============




The components of the net deferred income tax liability are as follows:

                                                                April 30,
                                                         -----------------------
                                                            2002          2001
                                                         ---------     ---------
                                                              (Thousands)

Deferred income tax assets-
    State tax loss carryforwards                         $ 4,500       $ 4,732
    Real estate inventory valuation                          602           623
    Interest payable on tax settlements                        -           622
    Other                                                    585         1,323
                                                         ---------     ---------
     Total deferred income tax assets                      5,687         7,300
                                                         ---------     ---------

Deferred income tax liabilities-
    Real estate basis differences                         (1,238)         (683)
    Reserve for periodicals and paperbacks                  (862)         (709)
    Depreciable assets                                    (2,413)       (1,675)
    Differences related to timing of  partnership income       -          (142)
    Capitalized costs for financial reporting
      purposes, expensed for tax                          (1,388)       (1,358)
                                                         ---------     ---------
    Total deferred income tax liabilities                 (5,901)       (4,567)
                                                         ---------     ---------
    Valuation allowance for realization of state tax
      loss carryforwards                                  (4,382)       (4,615)
                                                         ---------     ---------
  Net deferred income tax liability                      $(4,596)      $(1,882)
                                                         =========     =========



                                       30
<PAGE>


The following  table  reconciles  taxes computed at the U.S.  federal  statutory
income tax rate to the Company's actual tax provision (benefit):



                                                      Year Ended April 30,
                                              ----------------------------------
                                                 2002        2001        2000
                                              ----------  ----------  ----------
                                                         (Thousands)

Computed tax provision at
  statutory rate                              $   2,095   $   (500)   $   662
Increase (reduction) in tax resulting from:
  State income taxes, net of federal
    income tax effect                               308         73        126
  Net reduction in tax liability as a
    result of IRS settlement                          -     (3,500)         -
  Nondeductible meals and entertainment              44         57         71
  Other                                              18       (157)       (80)
                                              ----------  ----------  ----------
Actual tax provision (benefit)                $   2,465   $ (4,027)   $   779
                                              ==========  ==========  ==========

The  benefit  for income  taxes in 2001  includes a  component  of $3.5  million
resulting from the settlement of Internal  Revenue Service  examinations for the
years 1993 and 1994 at an amount less than that which the Company had previously
accrued on account thereof.

(9)      SHAREHOLDERS' EQUITY:
         ---------------------
The Company has from time to time  reacquired  its shares to be held as treasury
stock as part of a stock repurchase program. During 2000, the Company reacquired
143,000 of its common shares at a cost of approximately  $857,000.  During 2001,
the Board of Directors authorized an additional  repurchase of stock by means of
a self-tender  "Dutch  Auction" for 725,000  shares of the Company's  stock at a
price not to exceed  $7.00 per share and not lower than  $5.25 per  share.  As a
result of this program and other repurchases,  the Company reacquired a total of
approximately 668,000 shares at an aggregate cost of approximately $4.8 million.

(10)     COMMITMENTS AND CONTINGENCIES:
         ------------------------------
         Land sale contracts
         -------------------
The Company has entered into several conditional sales contracts for the sale of
approximately  400  lots in Rio  Rancho  which  would  close  at  varying  times
throughout  fiscal 2003 and 2004;  however,  since each of the contracts permits
the purchaser to terminate its obligations by forfeiture of a relatively  modest
deposit, there are no assurances that all, or even a substantial portion, of the
lots subject to the contracts will be sold pursuant to the contracts.

         Non-cancelable leases
         ---------------------
The Company is obligated under long-term non-cancelable leases for equipment and
various  real estate  properties.  Certain real estate  leases  provide that the
Company will pay for taxes,  maintenance and insurance costs and include renewal
options. Rental expense (in thousands) for 2002, 2001 and 2000 was approximately
$3,750, $3,767 and $4,667 respectively.

The approximate  minimum rental  commitments  for years  subsequent to April 30,
2002,  are as  follows  (in  thousands):  2003 - $1,900;  2004 - $1,606;  2005 -
$1,319; 2006 - $819; 2007 - $209, and the total future minimum rental payments -
$5,853.


                                       31
<PAGE>



         Rio Rancho lot exchanges
         ------------------------
In connection with certain  individual  homesite sales made prior to 1977 at Rio
Rancho, New Mexico, if water,  electric and telephone utilities have not reached
the lot site when a purchaser is ready to build a home, the Company is obligated
to exchange a lot in an area then  serviced by such  utilities  for a lot of the
purchaser,  without  cost  to  the  purchaser.  The  Company  has  not  incurred
significant costs related to the exchange of lots.

(11)     LITIGATION:
         -----------
The Company's magazine  subsidiary is a defendant in two lawsuits.  In one case,
the plaintiff is a former  wholesaler no longer in business who alleges that the
company and other national  magazine  distributors  and  wholesalers  engaged in
violations of the Robinson-Patman act, (which generally prohibits discriminatory
pricing) that caused it to go out of business.  In the other case, the plaintiff
is a fulfillment  services  company  which alleges Kable and R.D.  Manufacturing
Corporation  ("RDMC"),  a subsidiary  of the Readers  Digest  Association  and a
former  client of the  plaintiff,  engaged  in  practices  that  caused  RDMC to
terminate  its contract  with the  plaintiff  and become a client of Kable,  and
thereby  cause  the loss of  millions  of  dollars  and the  destruction  of the
business of the client.  In the first case, the plaintiff is seeking  damages of
$275 million trebled against all the defendants,  plus punitive damages.  In the
second case, the plaintiff is seeking  damages of not less than $15 million plus
punitive damages.  Kable has been indemnified by RDMC in this matter and RDMC is
providing joint defense to the complaint,  however,  Kable does not know if RDMC
has the resources to respond to any judgment.  Management  intends to vigorously
defend itself, however, the outcome of these matters is unknown since both cases
are in the early  stages,  discovery  has not  commenced  and it will be several
years before these matters are expected to come to trial.

The Company  and/or its  subsidiaries  are involved in various  other claims and
legal actions incident to their operations,  which in the opinion of management,
based upon  advice of  counsel,  will not  materially  affect  the  consolidated
financial position or results of operations of the Company and its subsidiaries.

(12)     FAIR VALUE OF FINANCIAL INSTRUMENTS:
         ------------------------------------
The estimated fair value of financial  instruments is determined by reference to
various market data and other valuation techniques as appropriate.  The carrying
amounts of cash and cash  equivalents and trade payables  approximate fair value
because of the short maturity of these  financial  instruments.  Debt that bears
variable  interest rates indexed to prime or LIBOR also  approximates fair value
as it reprices when market  interest rates changes.  The estimated fair value of
the Company's long-term,  fixed-rate mortgage receivables is $4.0 million versus
a  carrying  amount of $4.6  million,  and $5.0  million  versus  $5.2  million,
respectively,  at April 30, 2002 and April 30, 2001. The estimated fair value of
the  Company's  long-term,  fixed-rate  notes  payable is $3.1 million  versus a
carrying  amount of $2.6  million as of April 30, 2002 and $6.3  million  versus
$6.2 million as of April 30, 2001.


(13)     INFORMATION ABOUT THE COMPANY'S OPERATIONS IN DIFFERENT
         -------------------------------------------------------
         INDUSTRY SEGMENTS:
         ------------------
The  Company  has  identified  four  segments  in which it  operates  under  the
definition  established  by this  standard.  The Companys  magazine  circulation
operations has two identified segments, Distribution and Fulfillment operations.
Distribution operations involve the national and international  distribution and
sale of periodicals  and paperbacks to wholesalers,  and Fulfillment  operations
involve  the  performance  of  subscription  and product  fulfillment  and other
related  activities  on behalf of  various  publishers  and other  clients.  The
Company's real estate  subsidiary  also has two identified  segments,  Land Sale



                                       32
<PAGE>

operations  and  Homebuilding  operations.  Land  Sale  operations  involve  the
obtaining  of  approvals,  and  development  of large tracts of land for sale to
builders,  commercial users and others, and Homebuilding  operations involve the
construction and sale of single-family  homes and other projects.  Corporate and
other  miscellaneous  revenues  and expenses  not  identifiable  with a specific
segment  are  grouped  together  in  this  presentation.  Certain  expenses  are
allocated  among  industry  segments  based upon  management's  estimate of each
segment's absorption.

Identifiable  assets by industry are those assets that are used in the Company's
operations in each industry segment,  which also is based upon certain estimates
and allocations among segments.

The  following  schedules  set forth  summarized  data  relative to the industry
segments (amounts in thousands):

<TABLE>
<CAPTION>

                                                                         Land           Home       Corporate
                                       Distribution    Fulfillment       Sales        Building     and Other   Consolidated
                                       ------------    -----------   ------------   -----------   ----------   ------------
<S>                                     <C>            <C>          <C>            <C>           <C>          <C>
Year ended April 30, 2002:
   Revenues                            $   15,253      $  33,995     $   31,321     $     683     $  2,153     $    83,405
   Operating expenses                      13,065         32,492         26,164           950        3,306          75,977
   Interest expense, net                      933            158             27             -          147           1,265
                                       ------------    -----------   ------------   -----------   ----------   ------------
   Pretax income (loss) contribution   $    1,255      $   1,345     $    5,130     $    (267)    $ (1,300)    $     6,163
                                       ============    ===========   ============   ===========   ==========   ============

   Depreciation and amortization       $      890      $   1,296     $       94     $       -     $    411     $     2,691
   Identifiable assets                 $   34,382      $  19,562     $   75,787     $     448     $ 19,509     $   149,688
   Capital expenditures                $      133      $   2,629     $        -     $       -     $    137     $     2,899
---------------------------------------------------------------------------------------------------------------------------

Year ended April 30, 2001:
   Revenues                            $   13,899      $  34,671     $   17,914     $   4,805     $  1,920     $    73,209
   Operating expenses                      15,963         32,099         12,808         6,900        4,138          71,908
   Interest expense, net                    1,740            472            350            42          167           2,771
                                       ------------    -----------   ------------   -----------   ----------   ------------
   Pretax income (loss) contribution   $   (3,804)     $   2,100     $    4,756     $  (2,137)    $ (2,385)    $    (1,470)
                                       ============    ===========   ============   ===========   ==========   ============

   Depreciation and amortization       $    1,093      $   1,311     $      106     $     150     $    373     $     3,033
   Identifiable assets                 $   42,937      $  19,540     $   79,032     $   4,194     $ 19,141     $   164,844
   Capital expenditures                $      295      $   1,020     $        -     $       -     $    730     $     2,045
---------------------------------------------------------------------------------------------------------------------------

Year ended April 30, 2000:
   Revenues                            $   15,927      $  36,621     $   33,629     $   30,674    $  2,982     $   119,833
   Operating expenses                      15,858         35,006         24,851         34,218       5,006         114,939
   Interest expense, net                    1,558            553            370            241         224           2,946
                                       ------------    -----------   ------------   -----------   ----------   ------------
   Pretax income (loss) contribution   $   (1,489)     $   1,062     $    8,408     $   (3,785)   $ (2,248)    $     1,948
                                       ============    ===========   ============   ===========   ==========   ============
   Depreciation and amortization       $    1,076      $   1,585     $      361     $      860    $    222     $     4,104
   Identifiable assets                 $   43,157      $  16,778     $   77,808     $   10,247    $ 24,446     $   172,436
   Capital expenditures                $      592      $   1,159     $        -     $        -    $    908     $     2,659
---------------------------------------------------------------------------------------------------------------------------

</TABLE>



                                       33
<PAGE>



<TABLE>
<CAPTION>

Selected Quarterly Financial Data (Unaudited):
----------------------------------------------
                                             (In thousands of dollars, except per share amounts)
                                                                  Quarter Ended
                                         ----------------------------------------------------------------
<S>                                      <C>              <C>             <C>              <C>
                                            July 31,       October 31,      January 31,      April 30,
Year Ended April 30, 2002:                    2001            2001             2002             2002
                                         --------------   --------------  ---------------  --------------

Revenues                                 $      19,650    $      28,218   $      16,297    $      19,240

Gross Profit                                     2,814            6,228           3,945            5,542

Net Income (Loss)                        $        (365)   $       1,729   $         668    $       1,666
                                         ==============   ==============  ==============   ==============
Earnings (Loss) Per Share -
Basic and Diluted (b)                    $       (0.06)   $        0.26   $        0.10    $        0.25
                                         ==============   ==============  ==============   ==============


                                            July 31,       October 31,      January 31,      April 30,
Year Ended April 30, 2001:                    2000            2000            2001(a)           2001
                                         --------------   --------------  ---------------  --------------
Revenues                                 $      18,210    $      17,391   $      16,031    $      21,577

Gross Profit (Loss)                              3,892            4,566             (31)           5,147

Net Income (Loss)                        $        (214)   $         554   $       1,326    $         891
                                         ==============   ==============  ==============   ==============
Earnings (Loss) Per Share -
    Basic and Diluted (b)                $       (0.03)   $        0.08   $        0.20    $        0.14
                                         ==============   ==============  ==============   ==============


     (a) Includes a tax benefit of $3.5 million to reflect the settlement of IRS
         tax  examinations.  See Note 8.
     (b) The sum  of  the quarters  does not equal  the  full year  earnings per
         share  due  to  rounding  and, in  fiscal  2001, the change in  average
         shares outstanding during the year.

</TABLE>


Item 9.  Changes  in  and  Disagreements  with  Accountants  on  Accounting  and
         -----------------------------------------------------------------------
         Financial Disclosure.
         ---------------------
On March 7, 2002, the Company notified Arthur Andersen LLP ("Andersen") that the
Company  would  change  its  independent  public  accountants  and  auditors  to
McGladrey & Pullen, LLP for its fiscal year ending April 30, 2002.  Andersen and
its  predecessor  partnership had been the  independent  public  accountants and
auditors for the Company since 1981.

Prior to such notification, the Company did not consult with McGladrey & Pullen,
LLP regarding the application of accounting  principles to a specific  completed
or  contemplated  transaction  or any matter  that was  either the  subject of a
disagreement  or a  reportable  event.  The Company  also did not  consult  with
McGladrey  & Pullen,  LLP  regarding  the type of audit  opinion  that  might be
rendered on the Company's consolidated financial statements.

The reports of Andersen on the Company's  consolidated  financial statements for
the fiscal years ended April 30, 2001 and 2000  contained no adverse  opinion or



                                       34
<PAGE>

disclaimer  of opinion and were not  qualified  or  modified as to  uncertainty,
audit scope or  accounting  principles.  In  connection  with its audits for the
fiscal  years ended April 30, 2001 and 2000 and the  subsequent  interim  period
preceding  the  Company's  notification  to Andersen of its intention to dismiss
such  firm,  there has been no  disagreements  with  Andersen  on any  matter of
accounting principles or practices,  financial statement disclosure, or auditing
scope or procedure that, if not resolved to the satisfaction of Andersen,  would
have  caused  such  firm  to  make  reference  to  the  subject  matter  of  the
disagreement(s) in connection with this report.

The  Company's  Audit  Committee  participated  in and  approved the decision to
change the Company's external auditors and the Board made the appointment.






                                    PART III
                                    --------

The information called for by Part III is hereby  incorporated by reference from
the  information  set forth and under the headings  "Common  Stock  Ownership of
Certain  Beneficial  Owners  and  Management",   "Election  of  Directors",  and
"Executive Compensation" in Registrant's definitive proxy statement for the 2002
Annual  Meeting  of  Shareholders,   which  meeting  involves  the  election  of
directors,  such definitive  proxy statement to be filed with the Securities and
Exchange  Commission pursuant to Regulation 14A within 120 days after the end of
the  fiscal  year  covered by this  Annual  Report on Form  10-K.  In  addition,
information on Registrant's executive officers has been included in Part I above
under the caption "Executive Officers of the Registrant".





                                       35
<PAGE>



                                     PART IV
                                     -------
Item 14.   Exhibits, Financial Statement Schedules, and Reports on Form 8-K
--------   ----------------------------------------------------------------

(a)  1.  The  following   financial   statements  and  supplementary   financial
         information are filed as part of this report:

     AMREP Corporation and Subsidiaries:

     o Report of Independent Public Accountants dated June 14, 2002 -
                 McGladrey and Pullen, LLP

     o Report of Independent Public Accountants dated August 13, 2001 -
                 Arthur Andersen LLP

     o Consolidated Balance Sheets - April 30, 2002 and 2001

     o Consolidated Statements of Income for the Three Years
                 Ended April 30, 2002

     o Consolidated Statements of Shareholders' Equity for the Three Years
                 Ended April 30, 2002

     o Consolidated Statements of Cash Flows for the Three Years
                 Ended April 30, 2002

     o Notes to Consolidated Financial Statements

     o Selected Quarterly Financial Data

     2.  The following financial statement schedules are filed as part
         of this report:

     AMREP Corporation and Subsidiaries:

     o Schedule II - Valuation and Qualifying Accounts

     Financial  statement  schedules  not included in this Annual Report on Form
10-K  have  been  omitted  because  they  are  not  applicable  or the  required
information is shown in the financial statements or notes thereto.

     3.  Exhibits:

     The exhibits filed in this report are listed in the Exhibit Index.

     The  Registrant  agrees,  upon  request  of  the  Securities  and  Exchange
Commission, to file as an exhibit each instrument defining the rights of holders
of long-term debt of the Registrant and its consolidated  subsidiaries which has
not been filed for the reason  that the total  amount of  securities  authorized
thereunder  does not exceed 10% of the total  assets of the  Registrant  and its
subsidiaries on a consolidated basis.

(b)   During  the  quarter  ended  April 30,  2002,  Registrant  filed a Report
on Form 8-K on March 7, 2002 under Item 4, "Changes in  Registrant's  Certifying
Accountant,  reporting a change in independent  public  accountants and auditors
from Arthur Andersen LLP to McGladrey and Pullen, LLP for the fiscal year ending
April 30, 2002.

                                       36
<PAGE>


                                   SIGNATURES

Pursuant to the  requirements of Section 13 or 15(d) of the Securities  Exchange
Act of 1934,  Registrant  has duly caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized.

                                                           AMREP  CORPORATION
                                                              (Registrant)

Dated:  July 18, 2002                                    By /s/Peter M. Pizza
                                                            -----------------
                                                               Peter M. Pizza
                                                               Vice President

Pursuant  to the  requirements  of the  Securities  Exchange  Act of 1934,  this
amendment has been signed below by the following persons on behalf of Registrant
and in the capacities and on the dates indicated.

/s/Peter M. Pizza                                       /s/Nicholas G. Karabots
-----------------------                                 -----------------------
   Peter M. Pizza                                          Nicholas G. Karabots
   Vice President,                                         Director
   Principal Financial Officer                          Dated:  July 18, 2002
   and Principal Accounting Officer*
Dated:  July 18, 2002

/s/Jerome Belson                                        /s/Albert V.  Russo
-----------------------                                 -----------------------
   Jerome Belson                                           Albert V. Russo
   Director                                                Director
Dated:  July 18, 2002                                 Dated:  July 18, 2002

/s/Edward B. Cloues II                                  /s/Samuel N. Seidman
-----------------------                                 -----------------------
   Edward B. Cloues II                                     Samuel N. Seidman
   Director                                                Director
Dated:  July 18, 2002                                 Dated:  July 18, 2002

/s/Lonnie A. Coombs                                     /s/James Wall
-----------------------                                 -----------------------
   Lonnie A. Coombs                                        James Wall
   Director                                                Director
Dated:  July 18, 2002                                 Dated:  July 18, 2002



*Also acting as Principal  Executive Officer in the absence of a Chief Executive
Officer, solely for the purpose of signing this Annual Report.




                                       37
<PAGE>


<TABLE>
<CAPTION>


                       AMREP CORPORATION AND SUBSIDIARIES
                       ----------------------------------
                 SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS
                 -----------------------------------------------
                                   (Thousands)

                                                      Additions
                                            -----------------------------
                                               Charges       Charged
                               Balance at    (Credits) to  (Credited) to
                               Beginning      Costs and        Other                         Balance at End
Description                    of Period      Expenses       Accounts         Deductions       of Period
-----------                   -----------   -------------  --------------   --------------   --------------
<S>                            <C>          <C>            <C>              <C>              <C>
FOR THE YEAR ENDED
APRIL 30, 2002:
 Allowance for doubtful
 accounts (included in
 receivables - real estate
 operations on the
 consolidated balance sheet)   $     173    $       137    $          -      $      57       $        253
                              -----------   -------------  --------------   --------------   --------------
 Allowance for estimated
  returns and doubtful accounts
  (included in receivables -
  magazine circulation
  operations on the
  consolidated balance sheet)  $  50,413    $     8,098    $          -      $     600       $     57,911
                              -----------   -------------  --------------   --------------   --------------
FOR THE YEAR ENDED
APRIL 30, 2001:
 Allowance for doubtful
 accounts (included in
 receivables - real estate
 operations on the
 consolidated balance sheet)   $     361    $       (21)   $          -      $     167       $        173
                              -----------   -------------  --------------   --------------   --------------
 Allowance for estimated
 returns and doubtful accounts
 (included in receivables -
 magazine circulation
 operations on the
 consolidated balance sheet)   $  64,628    $   (11,509)   $          -      $   2,706       $     50,413
                              -----------   -------------  --------------   --------------   --------------

FOR THE YEAR ENDED
APRIL 30, 2000:
 Allowance for doubtful
 accounts (included in
 receivables - real estate
 operations on the
 consolidated balance sheet)   $     255     $     106     $          -      $       -       $        361
                              -----------   -------------  --------------   --------------   --------------
 Allowance for estimated
 returns and doubtful accounts
 (included in receivables -
 magazine circulation
 operations on the
 consolidated balance sheet)   $  44,357     $  41,387     $          -      $  21,116       $     64,628
                              -----------   -------------  --------------   --------------   --------------


</TABLE>

                                       38
<PAGE>


                                  EXHIBIT INDEX
                                  -------------
3 (a) (i)  Articles of Incorporation, as amended - Incorporated by  reference to
           Exhibit (3) (a) (i) to Registrant's Annual Report on Form 10-K for
           the fiscal year ended April 30, 1998.

3 (a) (ii) Certificate of Merger - Incorporated by  reference to Exhibit (3) (a)
           (ii) to Registrant's Annual Report on Form 10-K for the fiscal year
           ended April 30, 1998.

3 (b)      By-Laws as restated September 24, 1997 - Incorporated by reference to
           Exhibit 3 (c) to Registrant's Quarterly Report on Form 10-Q for the
           quarterly period ended October 31, 1997.


4 (a)     Loan  Agreement  dated  as of April 4,  2002  between  U.S.  Bank
          National  Association and Kable News Company,  Inc., Kable Fulfillment
          Services  of Ohio,  Inc.  and  Kable  Distribution  Services,  Inc.  -
          Incorporated  by  reference to Exhibit  4(a) to  Registrant's  Current
          Report on Form 8-K filed April 11, 2002.

10 (a)    Non-Employee  Directors Option Plan, as amended - Incorporated by
          reference to Exhibit 10 (i) to Registrant's Annual Report on Form 10-K
          for the fiscal year ended April 30, 1997.*

21        Subsidiaries of Registrant - Filed herewith.

23        Consent of McGladrey & Pullen, LLP

_________________________________________
* Management contract or compensatory plan or arrangement in which directors or
  officers participate.



                                       39