UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                              --------------------

                                    FORM 10-K
                 ANNUAL REPORT PURSUANT TO SECTIONS 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

(Mark One)


[ x ] Annual  Report  pursuant  to  Section  13 or  15(d)  of the  Securities
      Exchange Act of 1934 For the fiscal year ended April 30, 2006
                                       OR
[   ] Transition  Report  pursuant  to Section  13 or 15(d) of the  Securities
      Exchange Act of 1934 For the transition period from          to
                                                          --------    --------

                          Commission File Number 1-4702
                                                 ------

                                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.)

 212 Carnegie Center, Suite 302
      Princeton, New Jersey                                     08540
      ---------------------                                     -----
Address of principal executive offices)                       (Zip Code)

       Registrant's telephone number, including area code: (609) 716-8200
                                                           --------------

           Securities registered pursuant to Section 12(b) of the Act:

      Title of Each Class             Name of Each Exchange 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 is a well-known  seasoned  issuer,
as defined in Rule 405 of the Securities Act.
                           Yes         No   X
                               -----      -----

Indicate  by  check  mark if the  Registrant  is not  required  to file  reports
pursuant  to Section  13 or 15(d) of the  Securities  Exchange  Act of 1934 (the
"Act").
                           Yes         No   X
                               -----      -----

Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Act 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 ]

Indicate by check mark whether the Registrant is a large  accelerated  filer, an
accelerated  filer or a  non-accelerated  filer.  See definition of "accelerated
filer and large accelerated filer" in Rule 12b-2 of the Act.
  Large accelerated filer     Accelerated filer     Non-accelerated filer  X
                          ---                   ---                       ---

Indicate by check mark whether the  Registrant is a shell company (as defined in
Rule 12b-2 of the Act).
                           Yes         No   X
                               -----      -----
<PAGE>


As of October 31, 2005, which was the last business day of the Registrant's most
recently  completed  second fiscal  quarter,  the aggregate  market value of the
Common Stock held by  non-affiliates  of the  Registrant was  $44,854,869.  Such
aggregate  market  value was  computed by reference to the closing sale price of
the  Registrant's  Common Stock as quoted on the New York Stock Exchange on such
date. For purposes of making this  calculation  only, the Registrant has defined
affiliates as including all directors and executive officers and certain persons
related to them.  In making such  calculation,  the  Registrant  is not making a
determination of the affiliate or non-affiliate  status of any holders of shares
of Common Stock.

As of July 27, 2006,  there were  6,645,112  shares of the  Registrant's  Common
Stock outstanding.

                       DOCUMENTS INCORPORATED BY REFERENCE

As  stated  in Part III of this  annual  report on Form  10-K,  portions  of the
Registrant's  definitive  proxy  statement to be filed within 120 days after the
end of the  fiscal  year  covered  by  this  annual  report  on  Form  10-K  are
incorporated herein by reference.











































                                       2
<PAGE>

                                     PART I
                                     ------

Item 1.          Business
-------          --------

                                     GENERAL

The Company*,  through its subsidiaries,  is primarily engaged in three business
segments:  the Real Estate  business  operated by AMREP  Southwest  Inc. and its
subsidiaries (collectively, "AMREP Southwest"), and the Fulfillment Services and
Newsstand  Distribution  Services  businesses  operated by Kable Media Services,
Inc. and its  subsidiaries  (collectively,  "Kable").  Data concerning  industry
segments  is set  forth in note 17 of the  notes to the  consolidated  financial
statements. The Company's foreign sales and activities are not significant.

                             REAL ESTATE OPERATIONS

The Company  conducts its Real Estate  business  through AMREP  Southwest,  with
these activities  occurring  primarily in Rio Rancho,  New Mexico. As of July 1,
2006, the Real Estate business employed  approximately 15 persons,  none of whom
were represented by labor unions. The Company considers its relations with these
employees to be good.

Land Development Properties - Rio Rancho

Rio Rancho  (including the City) consists of 91,049 contiguous acres in Sandoval
County, New Mexico, near Albuquerque,  of which approximately  73,600 acres have
been platted into  approximately  113,800 homesite and commercial  lots,  16,400
acres  are  dedicated  to  community  facilities,  roads  and  drainage  and the
remainder is unplatted  land. At April 30, 2006,  approximately  88,200 of these
lots had been sold. The Company currently owns approximately 18,500 acres in Rio
Rancho,  of which  approximately  4,900 acres are in contiguous blocks which are
being developed or are suitable for development  and  approximately  2,000 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 government.  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.

Development  activities  conducted  or  arranged  by  the  Company  include  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.

Today,  Rio Rancho is the third  largest  city in New Mexico  with a  population
approaching  70,000.  The commercial areas in Rio Rancho presently  include more
than 500 businesses and  professional  offices,  as well as 17 shopping  centers
with approximately 1.7 million square feet of retail and office space, including
a 55,000 square foot office building and a 29,000 square foot commercial  rental
property which are owned by the Company. The industrial areas have approximately
85  buildings  with   approximately   4.5  million  square  feet,   including  a
manufacturing facility containing approximately 3.1 million square feet which is
owned and occupied by Intel Corporation, Rio Rancho's largest employer.

Since early 1977, no individual  lots without homes at Rio Rancho have been sold
by the Company to  consumers.  A  substantial  number of lots without homes 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 a lot when the purchaser is ready
to build a home, the


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

                                       3
<PAGE>

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.

Other Real Estate Properties

The Company has various  investment  properties,  principally  consisting of the
55,000  square foot  office  building it owns in Rio Rancho in which it occupies
approximately 5,400 square feet and leases the remainder,  and the 29,000 square
foot  commercial  rental  property it owns in Rio Rancho that is presently being
offered for lease. The Company may develop additional  investment  properties in
the future.

The  Company  also  owns  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  obtaining  all  necessary
entitlements,  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.

       FULFILLMENT SERVICES AND NEWSSTAND DISTRIBUTION SERVICES OPERATIONS

Through Kable,  the Company (i) performs  subscription  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,  2006,  Kable  employed   approximately   1,280  persons,  of  whom
approximately  1,130 were  involved  in its  fulfillment  activities  and 150 in
distribution  activities,  none of whom were  represented  by labor unions.  The
Company considers its relations with these employees to be good.

Fulfillment Services

Kable's  Fulfillment  Services  business  performs a number of  fulfillment  and
fulfillment-related  activities,  principally magazine subscription  fulfillment
services, lettershop and graphic arts services, customer telephone support, list
services and product fulfillment  services,  and it accounted for 85% of Kable's
revenues in fiscal 2006.

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  renewal  and  statement  notifications  for  mailing,
maintains  subscriber lists and data bases,  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 data base system.

Kable's lettershop and graphic arts departments  prepare and mail statements and
renewal forms for its  publisher  clients to use in their  subscriber  mailings.
List services  clients are also primarily  publishers  for whom Kable  maintains
client customer lists, selects names for clients who rent their lists to others,
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.

The Company  believes that Kable is the second largest  provider of subscription
fulfillment  services to magazine  publishers in the United  States,  performing
fulfillment  services  for  approximately  725  different  magazine  titles  for
approximately  250 clients and maintaining  almost 41 million active  subscriber
names  for  its  client   publishers.   In  a  typical  month,   Kable  produces
approximately  50 million  mailing  labels for its  client  publishers  and also
processes over 15 million pieces of outgoing mail for its clients.

There are a number of companies that perform fulfillment services for publishers
and with which Kable  competes,  including  one which is much larger than Kable.

                                       4
<PAGE>

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.

Newsstand Distribution Services

In its Newsstand  Distribution  Services operation,  Kable distributes magazines
for over 250 publishers.  Among the titles are many special interest  magazines,
including automotive,  puzzle, men's sophisticates,  comics, romance and sports.
Kable generally  purchases the publications from its publisher clients and sells
them to independent  wholesalers.  The wholesalers in turn sell the publications
to retail  outlets.  All parties  generally  have full return  rights for unsold
copies. In a typical month during fiscal 2006, Kable  distributed  approximately
25  million  copies  of  various  titles  through  a  distribution   network  of
approximately 100 independent  wholesalers.  The newsstand distribution business
accounted for 15% of Kable's revenues in fiscal 2006.

While Kable 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.

Kable competes primarily with three other national distributors, all of whom are
substantially larger than Kable. Each of these larger 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. In addition,  there has been a major consolidation and reduction in the
number of wholesalers to whom Kable  distributes  magazines arising from changes
within the magazine distribution industry in recent years. As a result, three of
these  wholesalers  accounted  for  approximately  57% of the fiscal  2006 gross
billings of the Newsstand Distribution Services operations and approximately 47%
of Kable's consolidated accounts receivable at April 30, 2006.

Item 1A.          Risk Factors
--------          ------------

The risks  described  below are among those that could  materially and adversely
affect the Company's  business,  financial  condition or results of  operations.
These risks could cause  actual  results to differ  materially  from  historical
experience and from results predicted by any forward-looking  statements related
to  conditions  or events that may occur in the future.  These risks are not the
only risks the Company  faces,  and other risks  include  factors not  presently
known as well as those that are currently considered to be less significant.

Real Estate Operations
----------------------

The Company's Real Estate  business is highly  concentrated  in one market,  and
current  results and future  growth may be limited if the economy  contracts  in
this market.  Substantially  all of the Company's real estate assets are located
in Rio Rancho,  New Mexico.  As a result of this geographic  concentration,  the
Company could be affected by changes in economic  conditions in this region from
time to time,  including  economic  contraction due to, among other things,  the

                                       5
<PAGE>

failure of key industries and employers.  The Company's results of operations or
future  growth  may be  adversely  impacted  if the demand  for  residential  or
commercial  real estate  declines  in Rio Rancho as a result of such  changes in
economic conditions.

The Company  owns a depleting  asset,  and  long-term  growth in the Real Estate
business will require the acquisition of additional  inventory or expansion into
new markets. Substantially all of the Company's real estate revenues are derived
from sales of its core  inventory in Rio Rancho,  New Mexico.  This property was
acquired  more than 40 years ago,  and as of April 30, 2006,  the Company  still
owned approximately 18,500 acres from this original purchase.  From time to time
during the Company's history, it has operated in other markets and it still owns
some land in Colorado,  but currently its operations  are conducted  entirely in
Rio Rancho. The continuity and future growth of the Company will require that it
acquire new  properties  in Rio Rancho or expand to other  markets to provide it
with sufficient assets in order to maintain its current level of operations. The
success of any such acquisitions may depend on the Company's ability to identify
and fairly value appropriate  assets for acquisition and to successfully  manage
and integrate such assets and personnel acquired in these  transactions.  If the
Company does not acquire new real estate assets,  it will  eventually  liquidate
its existing holdings and be out of the real estate business.

The Company is subject to substantial  legal,  regulatory and other requirements
regarding  the  development  of land,  which can cause  delays in land sales and
increase costs.  Development activities performed in connection with real estate
sales (including  obtaining necessary  governmental  approvals,  access to water
supplies,  installation of utilities and necessary storm drains, and building or
improving  roads) are regulated by numerous local,  state and federal  statutes,
ordinances,  rules and regulations,  including those concerning zoning, resource
protection and other  environmental  impacts.  These  regulations  often provide
broad  discretion to  governmental  authorities  that regulate these matters and
from whom the Company must obtain approvals.  The approval process can result in
delays and  increases  in cost to the Company as well as its primary  customers,
commercial and residential builders. Government regulations and legal challenges
may delay the start of planned  communities,  increase the Company's expenses or
limit its customers'  development  activities.  Various local, state and federal
statutes, ordinances, rules and regulations concerning access to water supplies,
zoning, construction, sales and similar matters also apply to the industry. This
governmental regulation affects the Company's land sales activities and at times
may limit the  Company's  ability to develop or sell land.  Delays and increased
expenses may also be  experienced  as a result of legal  challenges  to proposed
communities, whether brought by governmental authorities or private parties.

Increases in taxes or  governmental  fees would  increase the  Company's  costs.
Also,  adverse  changes in tax laws could  reduce  customer  demand for land for
commercial and residential development. Increases in real estate taxes and other
local  governmental  fees,  such as fees imposed on  developers to fund schools,
open space and road  improvements or to provide low and moderate income housing,
would  increase the Company's  costs and have an adverse effect on the Company's
operations.  In  addition,  increases  in local real estate  taxes or changes in
income tax laws that would  reduce or eliminate  tax  deductions  or  incentives
could  adversely  affect  homebuilders'  potential  customer  demand  and  could
adversely affect future sales.

Changing  market  conditions may adversely  affect  companies in the real estate
industry who rely upon adequate  credit in order to finance  their  purchases of
land from the Company. Residential and commercial developers to whom the Company
sells land  frequently  rely upon third party  financing  to provide the capital
necessary for their acquisition of land.  Changes in economic and other external
market  conditions may result in their inability to obtain  suitable  financing,
which could adversely impact the Company's  ability to sell land, or necessitate
it to sell land at lower prices,  thus reducing the margins that the Company has
historically achieved.

Adverse changes in general economic,  real estate  development or other business
conditions  could  adversely  affect the  Company's  business and its  financial
results.  A significant  percentage of the  Company's  real estate  revenues are
derived  from  customers  in the  residential  homebuilding  business,  which is
sensitive to changes in economic conditions and other factors, such as the level
of employment,  consumer confidence,  consumer income,  availability of mortgage
financing and interest rate levels.  Adverse changes in any of these conditions,
in  particular  in the Rio  Rancho  market  where the  Company  operates,  could
decrease  demand and  therefore  affect the pricing of land sold to  developers,
resulting in a decrease in the Company's revenues and earnings.

                                       6
<PAGE>

Real Estate is a cyclical industry.  During periods of economic  expansion,  the
Real Estate business  generally  benefits from the demand for developable  land.
During  periods of  economic  contraction,  the Company is  generally  adversely
affected by declining  demand for land.  Also, there can be no assurance that an
increase in demand or an economic  expansion will be sustained in the Rio Rancho
market, where the Company's core real estate business is based and operates.

The Real Estate business is dependent on subcontractors. The development of land
on a  timely  basis is  critical  to the  Company's  ability  to close  sales of
property in accordance with its  contractual  obligations.  The  availability of
subcontractors  in the Rio Rancho  market can be affected  by  numerous  factors
beyond  the  Company's   control,   including  the  general   demand  for  these
subcontractors  by other sellers of land.  While  alternate  suppliers exist for
many of the services required by the Company, there can be no assurance that the
Company will not experience  delays or be forced to seek alternative  suppliers,
which may  increase  costs or  adversely  affect  its  ability to sell land on a
timely basis.

Media Service Operations
------------------------

The  Company  participates  in highly  competitive  industries  and  competitive
pressures  may result in a  decrease  in its  revenues  and  profitability.  The
Fulfillment and Newsstand  Distribution  Services  businesses  compete in highly
competitive  markets,  and some  competitors  have financial  resources that are
substantially  greater than those of the Company.  Over the past several  years,
the  Company has  experienced  significant  price  competition  in its  markets.
Competitive  pressures  could cause the Company's  Media Services  businesses to
lose market  share or result in  significant  price  erosion  that would have an
adverse effect on their results of operations.

The  introduction and increased  popularity of alternative  technologies for the
distribution  of news,  entertainment  and other  information  and the resulting
shift in consumer habits and advertising  expenditures from print to other media
could  adversely  affect the Newsstand  Distribution  and  Fulfillment  Services
businesses.  Revenues in the Media Services  business  segments are  principally
derived from  services  performed  for  publishers.  The  distribution  of news,
entertainment  and other  information  via the Internet has become  increasingly
popular over the past several years, and viewing news,  entertainment  and other
content  on a  personal  computer,  cellular  phone or other  device  has become
increasingly  popular as well.  Accordingly,  the resulting shift of advertising
dollars  from  traditional  print to online  media  could  adversely  affect the
publishing  industry and,  ultimately,  have a "trickle down" negative impact on
the Company's Newsstand  Distribution and Fulfillment Services businesses due to
a shift in  consumer  demand  away  from the  print  media  and  toward  digital
downloading and other delivery methods.

Media  operations could face increased costs and business  disruption  resulting
from  instability in the newsstand  distribution  channel.  The Company  extends
credit to various companies that 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. Due
to industry  consolidation,  four wholesalers represent approximately 80% of the
wholesale  magazine  distribution  business.  There is a possibility  of further
consolidation  among these wholesalers,  and the insolvency of any of them could
have a material, adverse impact on the Company's financial condition and results
of operations.  Should there be a disruption in the wholesale channel,  it could
impede the ability to distribute magazines to the retail marketplace.

The Company's operating results depend in part on continued successful research,
development  and  marketing  of new or  improved  services  and data  processing
capabilities.  There  can  be  no  assurance  that  the  Company  will  continue
successfully  to introduce new services and data  processing  capabilities  on a
timely  and  cost-effective  basis.  The  success of new and  improved  services
depends on their initial and continued  acceptance by the various publishers and
customers  with whom the Company  conducts its business.  The Company's  several
revenue  streams are  affected by varying  degrees of  technological  change and
shifts in  customer  demand,  which may  result in the  transition  of  services
provided  and an  increased  importance  of being  "first  to  market"  with new
services and information processing  innovations.  Difficulties or delays in the
development,  production or marketing of new services and information processing
capabilities  may be experienced,  and this may negatively  impact the Company's
operating  results  and  prevent  it from  realizing  the  return on  investment
required to bring new services and information processing capabilities to market
on a timely and cost effective basis.

                                       7
<PAGE>

The Company  operates in highly  competitive  markets  that are subject to rapid
change,  and the Company must continue to invest in developing  technologies and
adapt  various  systems in order to remain  competitive.  There are  substantial
uncertainties  associated with the Company's efforts to develop new technologies
and services for the media fulfillment and distribution  markets it serves.  The
Company makes significant investments in new information processing technologies
and  services  that  may not be  profitable  and  even if they  are  profitable,
operating  margins  for new  technologies  and  services  may be lower  than the
margins that the Company has experienced historically.

The Company's  operations  could be disrupted if its  information  systems fail,
causing increased  expenses and loss of sales. The Company's business depends on
the efficient  and  uninterrupted  operation of its computer and  communications
capabilities,  including the  maintenance of customer data bases for billing and
label processing,  as well as its magazine distribution order regulation system.
If a key system were to fail or experience unscheduled down-time for any reason,
even if only for a short period, the Company's  operations and financial results
could  be  adversely  affected.  The  Company's  systems  could  be  damaged  or
interrupted by fire, flood, power loss, telecommunications failure, break-ins or
similar events.  The Company has a formal disaster  recovery plan in place,  but
this  plan  may  not be  entirely  successful  in  preventing  delays  or  other
complications  that could arise from  information  systems failure and, if it is
not successful, the Company's business interruption insurance may not adequately
compensate it for losses that may occur.

Virtually all of the Company's revenues in the Newsstand  Distribution  Services
business are derived from sales made on a fully  returnable  basis, and an error
in estimating  expected  returns could cause a misstatement  of revenues for the
period  affected.  As  is  customary  in  the  magazine  distribution  industry,
virtually  all of the Company's  revenues in this  business  segment are derived
from sales made on a fully  returnable  basis.  During the year ended  April 30,
2006,  approximately 75% of the magazines  initially  distributed by the Company
were  ultimately  returned  for  credit by  customers.  The  Company  recognizes
revenues  from the  distribution  of  magazines  at the time of  delivery to the
wholesalers,  less a reserve for  estimated  returns that is based on historical
experience and most recent sales data on an issue-by-issue  basis.  Although the
Company has the  contractual  right to return  these  magazines  for  offsetting
credits from the publishers  from whom the magazines are purchased,  an error in
estimating  the  percentage of returns at the end of an accounting  period would
have the effect of understating  or overstating  revenues in the period affected
as well as in the subsequent periods when the correct information became known.

The Company  depends on the Internet to deliver some of its services,  which may
expose the Company to increased  risks.  Many of the  Company's  operations  and
services,  including order taking on behalf of customers and communications with
customers and suppliers, involve use of the Internet, and the Company's business
is subject to any factors that adversely  affect Internet  usage,  including the
reliability  of  Internet  service  providers,  which,  from time to time,  have
operational  problems and experience service outages.  Additionally,  one of the
requirements   of  the  continued   growth  over  the  Internet  is  the  secure
transmission  of  confidential  information  over  public  networks.  Failure to
prevent security breaches of the Company's networks or those of its customers or
well-publicized  security  breaches  affecting  the  Internet  in general  could
significantly harm growth and revenues.

Other Entity-Wide Risk Factors
------------------------------

The Company  requires access to credit  facilities,  and either the inability to
obtain adequate  financing or increases in interest rates could adversely affect
its results of  operations.  The Company's  operations  depend on its ability to
obtain  financing for  development of land inventory in the Real Estate business
and for  working  capital  and  capital  expenditure  requirements  in the Media
Services business. If the Company is not able to obtain suitable financing,  its
costs could  increase and its revenues could  decrease,  or the Company could be
precluded from continuing its operations at current levels.

Increases in interest  rates can make it more  difficult and expensive to obtain
the funds needed to operate the Company's  businesses.  The applicable  interest
rates on the revolving bank credit facilities that both the Real Estate business
and  Media  Service  business  have in  place  fluctuate  based  on  changes  in
short-term interest rates generally and on the amount of outstanding  borrowings
under those facilities. Increases in interest rates would increase the Company's
interest expense.

                                       8
<PAGE>

The  Company  may  engage in  acquisitions  and may  encounter  difficulties  in
integrating  these  businesses and,  therefore,  may not realize the anticipated
benefits of the  acquisitions.  From time to time,  the Company may seek to grow
through strategic  acquisitions  intended to complement or expand one or more of
its  businesses  or to enable it to enter a new  business.  The success of these
transactions  may  depend on its  ability to  integrate  systems  and  personnel
acquired  in these  transactions  without  substantial  costs,  delays  or other
operational or financial  problems.  The Company may encounter  difficulties  in
integrating  acquisitions  with its  operations or in separately  managing a new
business.  Furthermore,  the  Company  may not  realize  the degree or timing of
benefits that it anticipates when first entering into a transaction.  Any of the
foregoing  could  adversely  affect  the  Company's   business  and  results  of
operations.

The Company's  management and internal systems may not be adequate to handle its
potential  growth.  To manage  future  growth,  the  Company's  management  must
continue to improve  operational  and  financial  systems and to expand,  train,
retain and manage its employee  base. At the same time,  the Company will likely
be  required  to  manage an  increasing  number of  relationships  with  various
customers and other parties.  If the Company's systems,  procedures and controls
are  inadequate  to support its  operations,  expansion  could be halted and the
opportunity  to gain  significant  additional  market  share could be lost.  Any
inability to manage growth effectively may harm the Company's business.

If  the  Company's  accounting  controls  and  procedures  are  circumvented  or
otherwise  fail to  achieve  their  intended  purposes,  its  business  could be
seriously  harmed.  Although the Company  evaluates  its  internal  control over
financial reporting and disclosure controls and procedures as of the end of each
quarter,  it may not be able to prevent all  instances of  accounting  errors or
fraud in the future.  These control  systems remain subject to the risk of human
error and the risk that controls can be  circumvented  for wrongful  purposes by
individuals in management and non-management  positions.  The Company's business
could be seriously harmed by any material failure of these control systems.

The Company has a principal  shareholder whose interests may conflict with other
investors.  The Company's  principal  shareholder owns  approximately 55% of its
outstanding  capital stock.  As a result,  the principal  shareholder  exercises
significant influence over the Company's major decisions,  including through his
ability to nominate and elect the members of the Board of Directors.

The  Company's  common  stock price has been  volatile,  which  could  result in
substantial  losses for  stockholders.  The Company's  common stock is currently
traded on the New York Stock  Exchange.  The  closing  sale prices of its common
stock have  ranged  from a low of $21.58 per share to a high of $46.75 per share
for the 52-week period ending April 30, 2006. The trading price of the Company's
common stock can be affected by numerous factors, including, but not limited to,
announcements  of new  services,  additions  or  departures  of  key  personnel,
quarterly fluctuations in the Company's operating results,  changes in analysts'
estimates of financial  performance,  general  conditions  in the  industries in
which the Company  operates and in the financial  markets and a variety of other
risk factors, including the ones disclosed in this annual report on Form 10-K.

The  Company's  quarterly  operating  results can fluctuate  significantly.  The
Company  has   experienced,   and  may  continue  to   experience,   significant
fluctuations in its quarterly operating results,  which may adversely affect its
stock price.  Future quarterly  operating results may not align with past trends
as  a  result  of  numerous  factors,   including  many  that  result  from  the
unpredictability  of the  nature  and  timing of real  estate  land  sales,  the
variability in gross profit margins and competitive pressures.

Changes in tax laws or the  interpretation of tax laws may negatively affect the
Company's  business.  The Company  believes  that its  recorded tax balances are
adequate. However, it is not possible to predict the effects of possible changes
in tax laws or in their  interpretation  and whether such  changes  could have a
material negative effect on the Company's operating results.

The Company may be subject to costly  litigation  and  governmental  proceedings
that could  adversely  affect its results of operations.  From time to time, the
Company  may be subject  to  various  claims  and  lawsuits  by the  government,
competitors, customers or other parties arising in or out of the ordinary course
of business.  Such matters can be time-consuming,  divert management's attention
and resources, and cause the Company to incur significant expenses. Furthermore,
there can be no assurance that the results of any of these actions will not have
a material  adverse  effect on the Company's  future  operating  results or cash
flows.

                                       9
<PAGE>

Terrorist  attacks  and  threats  may  disrupt  the  Company's   operations  and
negatively impact its revenues,  costs and stock price. The terrorist attacks in
September 2001 in the U.S., the U.S. response to those attacks and the resulting
decline in consumer  confidence  had a  substantial  adverse  impact on the U.S.
economy. Any similar future events may disrupt the Company's operations or those
of its customers. In addition, these events have had and may continue to have an
adverse  impact on the U.S.  economy  in general  and  consumer  confidence  and
spending  in  particular,  which  could  harm the  Company's  revenues.  Any new
terrorist  events or threats could have a negative  impact in the U.S. and world
financial  markets,  which could reduce the price of the Company's  common stock
and  limit  the  capital  resources   available  to  it  and  the  homebuilders,
publishers,  customers and others with whom the Company conducts business.  This
could have a significant  impact on revenues,  costs and  operating  results and
might result in increased volatility in the market price of the Company's common
stock.

The  Company's  pension plan is  underfunded,  and may require  additional  cash
contributions.  The Company's pension plan is underfunded by approximately  $3.2
million  at  April  30,  2006.  A  key   assumption   underlying  the  actuarial
calculations upon which the Company's  accounting and reporting  obligations are
based is an assumed  investment rate of return of 8%; if the pension plan assets
do not  realize  this  expected  rate of  return  or if  other  assumptions  are
incorrect,  the Company could be required to make  substantial  contributions to
its pension plan until the plan is fully funded, which could limit the Company's
financial flexibility.

The Company is dependent on its key personnel. The Company is dependent upon the
continued  services of certain key officers and  employees,  and the loss of key
personnel  could have an adverse effect on the Company's  business.  The Company
does not maintain "key man" insurance for any of its officers, and its continued
success  depends on the  ability to attract  and retain a skilled  labor  force.
There can be no assurance  that the Company will be successful in attracting and
retaining the personnel  required  either to maintain its business or expand its
operations.

Item 1B.          Unresolved Staff Comments
--------          -------------------------

Not applicable.

Item 2.           Properties
-------           ----------

The Company's  executive offices are located in approximately  2,500 square feet
of leased  space in an office  building in  Princeton,  New Jersey.  Real Estate
operations  are based in  approximately  5,400  square  feet in a  Company-owned
55,000 square foot office building in Rio Rancho, New Mexico, with the remaining
space leased to commercial tenants. In addition, other real estate inventory and
investment  properties  are described in Item 1. Kable's  executive  offices are
based in New  York  City,  and  these  offices  together  with  the  production,
administration,  sales and other  facilities  for its  Fulfillment  Services and
Newsstand  Distribution  Services  businesses  are  located in twelve  owned and
leased facilities which, in the aggregate, comprise approximately 600,000 square
feet of space in Mt. Morris, Illinois,  Marion, Ohio, Louisville,  Colorado, New
York City and Cerritos,  California.  The Company  believes its  facilities  are
adequate for its current and anticipated requirements.

Item 3.           Legal Proceedings
-------           -----------------

A. On May 3, 2000, a civil action was  commenced in the United  States  District
Court for 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 the  Company's  Kable News  Company,  Inc.
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  included two claims  against Kable News: (i)
violation of the Robinson-Patman  Act, which generally prohibits  discriminatory
pricing, and (ii) breach of fiduciary duty.

The defendants moved to dismiss the Second Amended  Complaint.  The Court denied
the motions  with respect to the  Robinson-Patman  Act claim but  dismissed  the

                                       10
<PAGE>

claim for breach of fiduciary duty. Kable News then answered the Robinson-Patman
Act claim, denying the material allegations and asserting  affirmative defenses.
Kable News also  asserted  counterclaims  to recover  certain  unpaid debts from
Unimag.

Pursuant to an order of a United States Magistrate Judge in October 2003, Unimag
presented  each of the  defendants  with an analysis of its damage claim against
such  defendant.  The damage claim against  Kable News amounts to  approximately
$15.2 million; any damages awarded would be trebled.

Pretrial discovery has been completed.  The action against Levy was settled, and
the remaining  defendants  moved for summary  judgment.  In September  2005, the
Court granted the motion for summary judgment of the defendants, including Kable
News, and judgment in favor of the defendants was entered on September 27, 2005.
Unimag filed an appeal of the judgment on July 5, 2006.

In April 2006,  Unimag entered into a consent judgment in favor of Kable News on
the counterclaims of Kable News for $4,159,770,  plus interest at the rate of 6%
per annum from  September  30,  1999,  and Kable News  agreed not to enforce the
judgment  until the action has been  concluded.  Unimag is no longer in business
and does not appear to have the assets to pay that judgment.

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

Item 4.           Submission of Matters to a Vote of Security Holders
-------           ---------------------------------------------------

There were no matters  submitted to a vote of security holders during the fourth
quarter of fiscal 2006.

Executive Officers of the Registrant

Set forth below is certain  information  concerning  persons who are the current
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;          69
                 Chairman, President and Chief Executive Officer of
                 AMREP Southwest Inc., a wholly-owned subsidiary of
                 the Company, since 1991.


Peter M. Pizza   Vice President and Chief Financial Officer of the         55
                 Company since May 2001; Vice President and Controller
                 of the Company from 1997 to 2001.


Joseph S. Moran  Vice President, General Counsel and Secretary of the      58
                 Company since June 2005; Mr. Moran previously served
                 as Vice President, General Counsel and Secretary of
                 SatCon Technology Corporation from 2001 to 2005.


Michael P. Duloc President and Chief Operating Officer of the Company's    49
                 Newsstand Distribution Services business since 1996
                 and of the Company's Fulfillment Services business
                 since 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.







                                       11
<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, 2006, there were approximately  1,450 holders of record
of the common stock.  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
      ------    ------   ------   ------    ------    ------    ------    ------

2006 $ 30.40   $ 21.58  $ 33.00  $ 24.00   $ 33.88   $ 23.22   $ 46.75   $ 27.25
2005 $ 20.80   $ 17.03  $ 18.55  $ 17.10   $ 23.90   $ 17.18   $ 28.34   $ 22.58


Dividend Policy

On July 14,  2006,  the Board of Directors  declared a special cash  dividend of
$0.85 per common share payable on August 16, 2006 to  shareholders  of record at
the close of business on July 31,  2006.  Previously,  the Company had  declared
special dividends of $0.55, $0.40 and $0.25 per share following the close of the
Company's  fiscal  years ending  April 30,  2005,  2004 and 2003.  The Board has
stated it may consider  special  dividends  from  time-to-time  in the future in
light of conditions then existing, including earnings, financial condition, cash
position,  and  capital  requirements  and  other  needs.  Notwithstanding  such
statement and the status of such future  conditions,  no assurance is given that
there  will be any  such  future  dividends  declared  or that  future  dividend
declarations,  if any,  will be  commensurate  in amount or frequency  with past
dividends.

In addition to the foregoing four special annual dividends, on December 7, 2005,
the Board of  Directors  declared a special  cash  dividend  of $3.50 per common
share  payable  on  January  9, 2006 to  shareholders  of record at the close of
business on December 19, 2005. The Board indicated that the Company's  financial
condition,  substantial  cash position and anticipated  cash flow,  particularly
from its  real  estate  operations,  in  relation  to its  then-current  capital
requirements were major factors in its determination to reward shareholders with
this special cash dividend.

Sales of Unregistered Company Stock

Pursuant to the Company's 2002  Non-Employee  Directors' Stock Plan, the Company
issued an aggregate of 7,500 shares of its Common Stock to its six  non-employee
directors on March 15, 2006, as partial  payment for their services as directors
for the six months preceding such issuances. These issuances were not registered
under the  Securities  Act of 1933,  as  amended,  by  reason  of the  exemption
provided in Section 4(2) of such Act for transactions by an issuer not involving
any public offering.

Equity Compensation Plan Information

See Item 12 of Part III of this  annual  report on Form  10-K that  incorporates
such  information by reference from the Company's  Proxy  Statement for its 2006
Annual Meeting of Shareholders.

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

The selected consolidated  financial data presented below for, and as of the end
of, each of the last five fiscal years has been derived from and is qualified by
reference to the consolidated  financial statements.  The consolidated financial
statements have been audited by McGladrey & Pullen, LLP, independent  registered
public  accounting firm. The information  should be read in conjunction with the
consolidated  financial  statements and related notes thereto and  "Management's
Discussion and Analysis of Financial Condition and Results of Operations", which
is Item 7 of Part  II of this  annual  report  on Form  10-K.  These  historical
results  are not  necessarily  indicative  of the  results to be expected in the
future.

                                       12
<PAGE>


<TABLE>

                                         (In thousands of dollars except per share amounts)
                                                        Year Ended April 30,
                          ----------------------------------------------------------------------------------
                                  2006             2005           2004            2003              2002
<S>                          <C>             <C>              <C>             <C>              <C>
                             --------------  ---------------  --------------- ---------------  -------------
Financial Summary (a):
  Revenues                    $  148,296       $   134,506      $  129,291      $   72,189      $   81,911
  Income from  Continuing
    Operations                $   22,494       $    15,588      $   11,297      $    6,227      $    3,721
  Income (loss) from
    Discontinued Operations,
    net of tax                $    3,556       $       (63)     $      380      $       46      $      (23)
  Net Income                  $   26,050       $    15,525      $   11,677      $    6,273      $    3,698
  Total Assets                $  189,041       $   194,309      $  171,165      $  159,550      $  149,832

Capitalization:
  Shareholders' Equity        $  118,970       $   117,405      $  105,522      $   93,828      $   93,479
  Notes Payable               $    6,016       $    12,054      $   12,643      $   18,427      $   16,619

Per Share:
  Earnings from Continuing
    Operations                $     3.39       $      2.36      $     1.71      $     0.94      $     0.57
  Income (loss) from
    Discontinued Operations   $     0.54       $     (0.01)     $     0.06      $     0.01      $    (0.01)
  Earnings Per Share-
    Basic and Diluted         $     3.93       $      2.35      $     1.77      $     0.95      $     0.56
  Book Value                  $    17.91       $     17.72      $    15.97      $    14.24      $    14.22
  Cash Dividend               $     4.05       $      0.40      $     0.25      $        -      $        -

Shares Outstanding                 6,644             6,626           6,606           6,588           6,574
</TABLE>

(a)  Amounts for 2002-2004 have been  reclassified  to present the  discontinued
     operation  of  the  Company's  utility  subsidiary.   See  note  2  to  the
     consolidated financial statements.

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

INTRODUCTION
------------

For a description of the Company's  business,  refer to Item I of Part I of this
annual report on Form 10-K.

As  indicated  in Item I, the  Company is  primarily  engaged in three  business
segments:  the  Real  Estate  business  operated  by  AMREP  Southwest  and  the
Fulfillment Services and Newsstand  Distribution Services businesses operated by
Kable. Data concerning industry segments is set forth in note 17 of the notes to
the  consolidated   financial  statements.   The  Company's  foreign  sales  and
activities are not significant.

The following  provides  information that management  believes is relevant to an
assessment and understanding of the Company's consolidated results of operations
and financial  condition.  The discussion should be read in conjunction with the
consolidated financial statements and accompanying notes. All references in this
Item 7 to 2006,  2005 and 2004 mean the fiscal years ended April 30, 2006,  2005
and 2004.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES
------------------------------------------

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

The  preparation  of  such  financial  statements  requires  management  to make
estimates  and  assumptions  that  affect  the  reported  amounts  of assets and
liabilities and disclosures of contingent  assets and liabilities at the date of
those  financial  statements  as well as the  reported  amounts of revenues  and
expenses during the reporting period.  Areas that require significant  judgments

                                       13
<PAGE>

and estimates to be made include:  (i) the determination of revenue  recognition
for the Newsstand Distribution Services business, which is based on estimates of
allowances  for  magazine  returns  to the  Company  from  wholesalers  and  the
offsetting  return of magazines by the Company to  publishers  for credit;  (ii)
allowances for doubtful accounts;  (iii) real estate cost of sales calculations,
which are based on land development  budgets and estimates of costs to complete;
(iv)  the  determination  of  revenue   recognition  under  the   percentage-of-
completion method for certain construction contracts,  which is determined based
on the  percentage  of  total  costs  incurred  to date in  proportion  to total
estimated costs to complete the project; (v) cash flow and valuation assumptions
in performing asset  impairment  tests of long-lived  assets and assets held for
sale;  (vi)  pension  plan  accounting;  and (vii) legal  contingencies.  Actual
results could differ from those estimates.

There are numerous critical  assumptions that may influence accounting estimates
in  these  and  other  areas.  Management  bases  its  critical  assumptions  on
historical  experience,  third-party  data and various other  estimates  that it
believes to be reasonable under the circumstances.  Certain of the most critical
assumptions  made  in  arriving  at  these  accounting   estimates  include  the
following:  (i) Newsstand  Distribution  Services revenues represent commissions
earned from the  distribution  of  publications  for client  publishers that are
recorded by the Company at the time the  publications  go on sale in  accordance
with  Statement  of Financial  Accounting  Standards  ("SFAS") No. 48,  "Revenue
Recognition When Right of Return Exists". 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
that are determined on an issue-by-issue basis utilizing  historical  experience
and current sales  information.  The financial impact to the Company of a change
in the  sales  estimate  for  magazine  returns  to it from its  wholesalers  is
substantially offset by the simultaneous change in the Company's estimate of its
cost of purchases since it passes on the returns to publishers for credit.  As a
result, the effect of a difference between the actual and estimated return rates
on  the  Company's   commission   revenues  is  the  amount  of  the  commission
attributable  to the  difference.  The effect of an  increase or decrease in the
Company's  estimated  rate of returns of 1% during any period would be dependent
upon the mix of magazines involved and the related selling prices and commission
rates,  but would  generally  result in a change in that period's net commission
revenues of approximately $125,000; (ii) management determines the allowance for
doubtful  accounts by attempting to identify  troubled accounts by analyzing the
credit risk of specific customers and by using historical  experience applied to
the aging of accounts and, where appropriate within the real estate business, by
reviewing  any  collateral  which may secure a  receivable;  (iii)  real  estate
development costs are incurred  throughout the life of a project,  and the costs
of initial sales from a project  frequently must include a portion of costs that
have been budgeted based on engineering  estimates or other studies, but not yet
incurred;   (iv)   percentage-of-completion   revenue  recognition  for  certain
construction  contracts is based on the  percentage  of total costs  incurred to
date in proportion  to total  estimated  costs to complete the  contract.  Total
estimated  costs,  and thus  contract  income,  are impacted by several  factors
including, but not limited to, changes in the costs of subcontractors, materials
and equipment,  productivity and scheduling; (v) asset impairment determinations
(including  that of  goodwill)  are based  upon the  intended  use of assets and
expected future cash flows; (vi) pension plan accounting and disclosure is based
upon  numerous  assumptions  and  estimates,  including  the  expected  rate  of
investment return on retirement plan assets, the interest rate used to determine
the  present   value  of   liabilities   (the   discount   rate),   and  certain
employee-related  factors such as turnover,  retirement age and  mortality.  The
effect of every 0.25% change in the investment rate of return on retirement plan
assets would increase or decrease the pension expense by  approximately  $70,000
per year, and a change in the discount rate of 0.25% at a fiscal  year-end would
result in an  increase  or decrease in the  subsequent  year's  pension  cost of
approximately  $45,000;  and (vii) the  Company  is  currently  involved  in one
significant  legal proceeding which is described in Item 3 of this annual report
on Form 10-K, and several routine  matters.  If the summary judgment in favor of
the  defendants,  including  the  Company,  were  reversed  upon  appeal  in the
significant  proceeding and if the plaintiffs  were then to prevail in the case,
the result could have a material  adverse  effect on the financial  condition of
the Company. It is possible that the consolidated  financial position or results
of operations for any particular  quarterly or annual period could be materially
affected by an outcome of other litigation that is significantly  different from
our assumptions.

Year Ended April 30, 2006 Compared to Year Ended April 30, 2005
---------------------------------------------------------------

Results of Operations

Net income in 2006 was $26,050,000,  or $3.93 per share,  compared to net income
of $15,525,000,  or $2.35 per share, in 2005. The 2006 results  consisted of net

                                       14
<PAGE>

income from continuing  operations of $22,494,000,  or $3.39 per share,  and net
income from discontinued  operations of $3,556,000,  or $0.54 per share,  versus
net income from continuing operations of $15,588,000,  or $2.36 per share, and a
net loss from discontinued  operations of $63,000,  or $0.01 per share, in 2005.
The substantial  increase in net income from  continuing  operations in 2006 was
attributable  to  significant  revenue  growth and the  resulting  gross profits
achieved  in  the  Company's  Real  Estate  operations.   Consolidated  revenues
increased to $148,296,000  in 2006 from  $134,506,000 in 2005 as a result of the
increased real estate revenues,  partially offset by decreased revenues from the
Company's Media Services operations (as described below).

Net income from  discontinued  operations  in 2006  reflected  the gain from the
disposition of the primary  assets of the Company's El Dorado,  New Mexico water
utility  subsidiary,  which were taken  through  condemnation  proceedings.  The
Company began accounting for this subsidiary as a discontinued  operation in the
quarter ended January 31, 2005.  Accordingly,  financial  information  for prior
periods has been reclassified to conform to this presentation.

Revenues from land sales at the Company's AMREP Southwest  subsidiary  increased
approximately 60%, from $36,154,000 in 2005 to $57,810,000 in 2006, resulting in
significantly  higher  gross  profits in 2006  compared to the prior year.  This
substantial  revenue  increase was due to increased  sales of both developed and
undeveloped lots in the Company's principal market of Rio Rancho, New Mexico. An
increase  in  revenues  from the sale of  developed  lots to  homebuilders  from
$14,994,000 in 2005 to $31,920,000 in 2006 demonstrated the continuing  strength
of the Rio Rancho market,  while  revenues from the sale of undeveloped  builder
lots increased from  $11,914,000 in 2005 to $19,514,000 in 2006  principally due
to one  large  transaction  that  was  part  of a  redevelopment  project  being
undertaken by another company.  Revenues from sales of commercial and industrial
properties  decreased slightly in 2006, from $7,183,000 in 2005 to $6,376,000 in
2006,  as the prior  year  included  one large  sale  that  represented  a major
component of the revenues  whereas 2006 activity  consisted of numerous  smaller
transactions. The average gross profit percentage on land sales decreased to 54%
in 2006 from 55% in 2005, reflecting the relative mix of lots sold in each year.
Revenues and related gross profits from land sales can vary  significantly  from
period to period as a result of many factors, including the nature and timing of
specific  transactions,  and prior results are not necessarily a good indication
of what may occur in future periods.

Revenues from Kable's Fulfillment Services and Newsstand  Distribution  Services
businesses  (collectively,  "Media Services operations") decreased approximately
9%, from  $96,913,000 in 2005 to $88,463,000 in 2006.  This revenue  decline was
due to a decrease in Fulfillment Services revenues of $8,564,000 (10%) offset in
part by a $114,000 (1%) increase in Newsstand Distribution Services revenues.

Although  there  are  multiple  revenue  streams  in  the  Fulfillment  Services
business, including revenues from the maintenance of customer computer files and
the performance of other  fulfillment-related  activities,  including  telephone
(call  center)  support and graphic  arts and  lettershop  services,  a customer
generally  contracts for and utilizes all available services as a total package,
and the Company would not provide its ancillary services to a customer unless it
was also providing the core service of  maintaining a data base of names.  Thus,
variations in fulfillment  revenues are the result of fluctuations in the number
and sizes of customers rather than in the demand for a particular service.  This
is also true in the Newsstand Distribution Services business where there is only
one  primary  service  provided  which  results  in  one  revenue  source,   the
commissions  earned on the distribution of magazines.  The Company competes with
other  companies,  including  three  much  larger  companies  in  the  Newsstand
Distribution  Services  business and one much larger company in the  Fulfillment
Services  business,  and the  competition  for new  customers is intense in both
segments,  which results in a price  sensitive  industry  which may restrict the
Company's ability to increase its prices.

The 10% revenue decline in Fulfillment  Services in 2006 was principally  caused
by  customer  losses  that  occurred  in earlier  periods  at  Kable's  Colorado
fulfillment  services  business that was acquired from  Electronic  Data Systems
Corporation  ("EDS") in fiscal 2003,  while  revenues of Newsstand  Distribution
Services  increased 1% primarily because decreases in gross billings to existing
customers were offset by additional  revenues  generated by new business.  Total
operating  expenses of the Media  Services  operation  decreased  by  $5,368,000
(6.8%) in 2006  compared to 2005,  with the  operating  expenses of  Fulfillment
Services decreasing $5,179,000 (7.4%) compared to the prior year principally due
to  decreases  in  payroll  and  other  variable  expenses  resulting  from  the
fulfillment  services revenue decrease as well as the  non-recurrence of certain
consulting expenses incurred in the prior year.  Fulfillment  operating expenses

                                       15
<PAGE>

amounted to 87% of related  revenues in 2006 compared to 84% in 2005.  Operating
expenses for Newsstand  Distribution  Services decreased $189,000 (2.1%) in 2006
compared to 2005  principally  as a result of certain  one-time  2005  marketing
costs,  and these expenses  amounted to 66% of related revenues in 2006 compared
to 68% in 2005.

Real estate  commissions and selling expenses  decreased from $1,863,000 in 2005
to  $1,427,000  in 2006,  representing  approximately  5.2% and 2.5% of  related
revenues in each year;  the higher rate in 2005 was  primarily  due to legal and
other closing costs  associated  with  condemnation  proceedings  related to the
Company's  last parcel of land in Florida.  Such costs  generally vary depending
upon the terms of specific sale transactions.  Real estate and corporate general
and  administrative  expenses  increased  by  $630,000 in 2006 as a result of an
increase  in the  Company's  stock  price  which is used to value the portion of
director compensation that is paid in stock, the addition of a corporate general
counsel and the  presence  in the prior year of a sublease on certain  corporate
office space which offset a portion of the Company's rental expense. General and
administrative  costs of Media Services  operations  decreased by  approximately
$821,000  (10%) from 2005 to 2006, and remained at  approximately  9% of Kable's
total revenues in both years.

Interest and other revenues,  which consist primarily of interest on real estate
mortgage  loans  and  rental  income,  increased  from  $1,439,000  in  2005  to
$2,023,000 in 2006 as a result of higher  average  balances of invested cash and
cash  equivalents  during 2006.  Other  expenses  primarily  consist of expenses
associated  with rental  operations  and real estate  taxes on land  parcels not
under development, and these expenses decreased from approximately $1,453,000 in
2005 to $1,114,000 in 2006,  principally due to costs incurred in 2005 to settle
certain  warranty  claims  related  to  the  Company's  previously  discontinued
homebuilding operations.

The Company's  effective tax rate from  continuing  operations was 31.3% in 2006
compared to 32.0% in 2005.  The decrease from the  statutory  rate in both years
was primarily due to tax benefits  associated with charitable  contributions  of
land.

Year Ended April 30, 2005 Compared to Year Ended April 30, 2004
---------------------------------------------------------------

Results of Operations

Consolidated  revenues  increased from  $129,291,000  in 2004 to $134,506,000 in
2005,  or 4%,  as a result  of  revenue  growth  in the  Company's  Real  Estate
operations  that was partially  offset by decreased  revenues from Kable's Media
Services  operations.  Net income  from  continuing  operations  increased  from
$11,297,000,  or $1.71 per share, in 2004 to $15,588,000, or $2.36 per share, in
2005,  primarily as a result of the increased  revenues and higher gross margins
on land sales in the Real Estate operations.

Revenues from land sales increased  approximately  29%, from $28,012,000 in 2004
to $36,154,000 in 2005. This  improvement was the result of an increased  volume
of sales of both  developed  and  undeveloped  lots in the  Company's  principal
market of Rio Rancho,  New Mexico,  including the sales of several large parcels
for commercial  development in Rio Rancho.  The gross profit percentages on land
sales  were 55% and 51% in 2005 and 2004.  As  previously  noted,  revenues  and
related  gross  profits  from land sales can vary  significantly  from period to
period as a result of many factors,  including the nature and timing of specific
transactions,  and prior results are not  necessarily a good  indication of what
may occur in future periods.

Revenues from Media Services  operations  decreased from  $99,791,000 in 2004 to
$96,913,000  in 2005.  This decrease of 3% was the net result of a 4% decline in
the  Fulfillment  Services  segment  offset  in  part  by a 7%  increase  in the
Newsstand  Distribution  Services segment.  The decline in Fulfillment  Services
revenues was  anticipated  and  principally the result of customer losses at the
Company's  Colorado  fulfillment  business  which had been  identified and known
prior to  Kable's  acquisition  of that  business  from EDS in 2003,  while  the
increase in revenues of Newsstand Distribution Services resulted from additional
business  obtained  in  connection  with the  purchase  of certain  distribution
contracts in the third quarter of 2005. Total operating expenses decreased 4% in
2005  compared to 2004,  with the  operating  expenses of  Fulfillment  Services
decreasing 6% compared to the prior year due in part to decreases in payroll and
other variable expenses resulting from the revenue decrease, reduced third-party
charges for outsourced  computer  processing and the inclusion in the prior year
of  approximately  $1,600,000 of costs of relocating  and  centralizing  certain
fulfillment  operations.  Fulfillment  operating  expenses  amounted  to  84% of

                                       16
<PAGE>

related revenues in 2005 compared to 86% in 2004.  Operating costs for Newsstand
Distribution  Services  increased  10% in 2005  compared  to 2004 as a result of
costs related to the increased revenues acquired in 2005,  including  additional
market  study  costs  incurred  in the third and fourth  quarters  of 2005,  and
amounted to 68% of related revenues in 2005 compared to 66% in 2004.

Real estate  commissions  and selling  expenses  increased  as a  percentage  of
related  revenues,  from 3.3% in 2004 to 5.2% in 2005,  due to the  closing of a
higher mix of land sales in the prior year without the  involvement of a broker.
Such  costs   generally   vary   depending  upon  the  terms  of  specific  sale
transactions.  Real estate and  corporate  general and  administrative  expenses
increased  in 2005 versus  2004,  principally  due to the effect of an actuarial
gain that occurred in the prior year  resulting  from the  curtailment of future
service  benefits under the Company's  pension plan, as discussed  below.  Media
Services general and  administrative  costs decreased by approximately  $300,000
from 2004 to 2005,  and remained at  approximately  9% of total revenues in both
years.

Interest  and other  revenues  consist  primarily  of  interest  on real  estate
mortgage  loans and rental  income,  and was  approximately  $1,488,000  in 2004
compared to $1,439,000 in 2005.  Other  expenses  primarily  consist of expenses
associated  with rental  operations  and real estate  taxes on land  parcels not
under development, and these expenses increased from approximately $1,140,000 in
2004 to $1,453,000 in 2005,  principally due to costs incurred in 2005 to settle
certain  warranty  claims  related  to  the  Company's  previously  discontinued
homebuilding operations.

Results for 2004 included the  recognition in the third quarter of a pretax gain
of approximately $1,700,000 (equivalent to $0.16 per share) from the accelerated
recognition  of a deferred  actuarial  gain  resulting  from the  curtailment of
future  service  benefits  under the Company's  pension plan.  This  transaction
resulted in consolidated  pension income of $485,000 in 2004 compared to pension
expense  of  $303,000  in  2005  (see  note  10 to  the  consolidated  financial
statements).

The Company's  effective tax rate from  continuing  operations was 32.0% in 2005
compared  to 37.0% in  2004.  The  decrease  in 2005  was  primarily  due to tax
benefits associated with the charitable contribution of land.

LIQUIDITY AND CAPITAL RESOURCES
-------------------------------

During the past several  years,  the Company has financed  its  operations  from
internally generated funds from real estate sales and magazine  operations,  and
from borrowings under its various loan agreements.

Cash Flows From Financing Activities
------------------------------------

AMREP  Southwest  has a loan  agreement  with a bank  with a  maximum  borrowing
capacity of $10,000,000  that may be used to support real estate  development in
New Mexico.  The loan is unsecured  and bears  interest at the bank's prime rate
less 0.75% or, at the borrower's option, a LIBOR-based  interest rate plus 2.0%.
At April 30, 2006, there were no balances  outstanding under this facility.  The
credit agreement contains certain covenants, the most significant of which limit
other borrowings and require the maintenance of a minimum tangible net worth (as
defined) and a certain level of unencumbered inventory.  This credit arrangement
expires in October 2008.

The companies  within the Media Services  operations  have a credit  arrangement
with a bank that matures in 2010 and allows separate revolving credit borrowings
of up to $11,000,000 for Fulfillment Services and up to $9,000,000 for Newsstand
Distribution  Services,  in each case based upon a prescribed  percentage of the
borrower's  eligible  accounts  receivable.  The  individual  credit  lines  are
collateralized  by  substantially  all of  each  borrower's  assets  (consisting
principally  of  accounts  receivable  and  machinery  and  equipment)  and bear
interest  at the  bank's  prime  rate  (7.75%  at April  30,  2006)  or,  at the
borrower's option, a reserve adjusted  overnight or 30-day LIBOR-based  interest
rate  (4.94% at April 30,  2006)  plus,  in either  case,  a margin  established
quarterly of from 1.75% to 2.50%  depending upon the  borrower's  funded debt to
EBITDA ratio, as defined.  At April 30, 2006, the borrowing  availability of the
Fulfillment  Services  business was  $10,216,000  against which  $1,898,000  was
outstanding,  the borrowing  availability of the Newsstand Distribution Services
business was $7,997,000 against which $479,000 was outstanding, and the interest
rate for  outstanding  borrowings  was 6.69% based on the  overnight  LIBOR rate
option.  The loan agreement  requires the  maintenance or achievement of certain
financial ratios and contains  certain other covenants,  the most significant of
which limit the amount of dividends  and other  payments that may be made by the
borrowers to their parent or other affiliates,  as well as capital  expenditures
and other  borrowings.  An additional  $2,007,600 is available under this credit
arrangement for capital expenditures.

                                       17
<PAGE>

In May,  2006,  the Media  Services  operations  loan  agreement  was amended to
provide for an additional  $10,000,000 revolving facility to a subsidiary of the
Newsstand  Distribution  Services  business  on the same terms  (except  for the
amount  borrowable  and the use of proceeds) as provided in the existing  credit
agreement. The proceeds of borrowings under this arrangement may be used only to
pay accounts  payable under a magazine  distribution  agreement  with one of the
borrower's publisher  customers.  Subject to such maximum loan amount, up to 40%
of the amount of the borrower's  accounts  receivable  from the  distribution of
magazines  covered  by the  distribution  agreement  with that  customer  may be
borrowed. The amendment also provided for a secured term loan to the Fulfillment
Services  business  of  $1,470,000,  bearing  interest  at the rate of 6.25% and
repayable in equal monthly installments through 2010, the proceeds of which were
applied to the financing of certain equipment.

Consolidated  notes  payable  outstanding  at April  30,  2006  were  $6,016,000
compared to $12,054,000 at April 30, 2005. All  outstanding  borrowings at April
30, 2006 and 2005 were related to Media Services operations.

Cash Flows From Operating Activities
------------------------------------

Inventories amounted to $47,533,000 at April 30, 2006 compared to $52,906,000 at
April 30, 2005.  Inventories  in the  Company's  core real estate  market of Rio
Rancho  decreased from $46,674,000 at April 30, 2005 to $40,981,000 at April 30,
2006 as the result of land sales. The balance of inventory principally consisted
of properties in Colorado in both years.

Receivables from Real Estate  operations  increased from $6,277,000 at April 30,
2005 to $14,592,000 at April 30, 2006,  principally due to the receipt of a note
in the amount of  $9,557,000 in  connection  with an April 2006 land sale.  This
note was paid in full in June 2006. Pursuant to the terms of the sale, the buyer
also provided a "loan reserve  letter of credit"  which  guarantees  the Company
payment for certain remaining development  obligations it retained in connection
with the sale,  which is being  accounted for on the  "percentage of completion"
method  (see  note  1  to  the  consolidated   financial  statements,   "Revenue
recognition  - real  estate").  Consideration  received  in  excess  of  amounts
recognized  as land sale  revenue on this  transaction  is  reported as deferred
revenue on the accompanying consolidated balance sheet.

Receivables  from Media Service  operations  decreased from $51,348,000 at April
30,  2005 to  $37,140,000  at April 30,  2006 as a result of reduced  wholesaler
billings  in  the  Newsstand   Distribution   Services  business  and  decreased
Fulfillment Services revenues as well as an improved rate of collection.

Accounts  payable and accrued  expenses  decreased from $50,733,000 at April 30,
2005 to $39,382,000 at April 30, 2006,  mainly because the prior year included a
$7,000,000  deposit held in connection with the condemnation  proceedings on the
assets of the Company's utility subsidiary.

Other assets  increased  from  $12,347,000  at April 30, 2005 to  $15,238,000 at
April 30, 2006,  principally as a result of amounts  deferred in connection with
the development of a new information systems platform for Fulfillment Services.

The unfunded pension liability of the Company's defined benefit  retirement plan
decreased  from  $5,780,000  at April 30, 2005 to  $3,234,000 at April 30, 2006,
principally  due to an  increase  in the fair  market  value of the plan  assets
during the year resulting  from a combination  of realized and unrealized  gains
from investment assets. As a result, the Company recorded  comprehensive  income
of $1,904,000 in 2006  compared to a  comprehensive  loss of $1,362,000 in 2005,
reflecting the change in the unfunded pension  liability in each year net of the
related deferred tax and unrecognized prepaid pension amounts.

Cash Flows From Investing Activities
------------------------------------

Capital expenditures for property, plant and equipment amounted to approximately
$3,683,000  and  $3,060,000  in 2006  and  2005  and  consisted  principally  of
expenditures for computer hardware and software for Kable's Fulfillment Services
segment. In addition,  capital  expenditures for investment assets were $213,000
in 2006 and $1,885,000 in 2005 and were  principally  related to the development
of commercial properties owned by the real estate business. The Company believes
that it has adequate  financing  capability to provide for  anticipated  capital
expenditures.

                                       18
<PAGE>

Future Payments Under Contractual Obligations
---------------------------------------------

The table below summarizes significant  contractual cash obligations as of April
30, 2006 for the items indicated (in thousands):

<TABLE>


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

          Contractual                         Less than       1-3             3-5           More than
          Obligations           Total          1 year        years           years           5 years
          -----------        -----------    ------------   -----------    ------------    -------------

    Notes payable            $    6,016      $    1,673     $   1,709      $    2,634      $        -
    Operating leases             25,055           5,396         6,482           4,827           8,350
                             -----------    ------------   -----------    ------------    -------------
    Total                    $   31,071      $    7,069     $   8,191      $    7,461      $    8,350
                             ===========    ============   ===========    ============    =============
</TABLE>


NEW AND EMERGING ACCOUNTING STANDARDS
-------------------------------------

In May 2005, the Financial  Accounting  Standards Board ("FASB") issued SFAS No.
154,  "Accounting  Changes  and  Error  Corrections".   SFAS  No.  154  requires
restatement  of prior  periods'  financial  statements for changes in accounting
principle,  unless it is impracticable  to determine either the  period-specific
effects or the cumulative effect of the change. Also, SFAS No. 154 requires that
retrospective  application of a change in accounting principle be limited to the
direct effects of the change.  SFAS No. 154 is effective for accounting  changes
and  corrections  of errors made in fiscal years  beginning  after  December 15,
2005.

In June 2005,  the FASB ratified  Emerging  Issues Task Force ("EITF") Issue No.
04-10, "Determining Whether to Aggregate Operating Segments That Do Not Meet the
Quantitative  Thresholds".  The  standard is  effective  for fiscal years ending
after  September 15, 2005, and does not effect the current  presentation  of the
Company's reportable operating segments.

In November 2005, the FASB issued FASB Staff Position  ("FSP") FAS 115-1 and FAS
124-1,  "The Meaning of  Other-Than-Temporary  Impairment and Its Application to
Certain Investments".  The FSP provides guidance regarding when an investment is
impaired, whether that impairment is other than temporary and measurement of the
impairment  loss. The FSP applies to debt and equity  securities,  except equity
securities  accounted  for under the equity  method.  The FSP is  effective  for
reporting  periods  beginning  after December 15, 2005. The Company is currently
evaluating the application of this FSP to determine its potential  impact on its
consolidated financial statements.

In addition to these recently  issued  accounting  standards,  there are several
emerging   accounting  issues  that  could  potentially   impact  the  Company's
consolidated  financial statements in the future,  including (i) a proposed SFAS
on "Fair Value Measurements" (exposure draft); (ii) a proposed Interpretation on
"Accounting  for Uncertain Tax Positions - an  interpretation  of FASB Statement
No. 109 (exposure  draft)";  and (iii) a proposed SFAS  "Accounting for Pensions
and Other Postretirement Benefits (preliminary views)".

The Company will monitor these  emerging  issues to assess any potential  future
impact on its consolidated financial statements.

SEGMENT INFORMATION
-------------------

Information  by industry  segment is  presented  in note 17 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)

                                       19
<PAGE>

contribution"  of each  segment  as  summarized  in note 17 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
recovered  through  increased sales prices or improved  operating  efficiencies,
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 recent years interest rates have been at historically
low levels and other price  increases  have been  commensurate  with the general
rate of inflation in the Company's markets,  and as a result the Company has not
found the inflation risk to be a significant problem in its real estate or Media
Services operations businesses.

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 or 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 contingencies
that are difficult to predict.  These risks and uncertainties  include,  but are
not  limited  to,  those set  forth in Item 1A above  under  the  heading  "Risk
Factors".  Many of the factors that will determine the Company's  future results
are beyond the ability of  management to control or predict.  Therefore,  actual
outcomes and results may differ  materially from what is expressed or forecasted
in or suggested by such  forward-looking  statements.  The Company undertakes no
obligation to revise or update any  forward-looking  statements,  or to make any
other forward-looking statements, whether as a result of new information, future
events or otherwise.





















                                       20
<PAGE>

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 and fixed rate  receivables.  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, 2006 the  Company's  long-term  debt  obligations  and  receivables
(excluding trade accounts) by scheduled maturity, weighted average interest rate
and estimated Fair Market Value ("FMV") (amounts in thousands):

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


                                                                      There-              FMV @
                    2007       2008     2009      2010      2011      after    Total     4/30/06
                    ----       ----     ----      ----      ----      -----    -----     -------

Fixed rate
 receivables      $ 10,956   $  3,217  $     37  $    -    $    -    $    -   $ 14,210  $ 14,094

Weighted average
 interest rate        8.0%       8.4%      8.3%       -         -         -       8.1%        -

Fixed rate debt   $  1,673   $  1,419  $    290  $   257   $    -    $    -   $  3,639  $  3,385


Weighted average
 interest rate        5.2%       4.6%      6.9%     6.9%        -         -       5.2%        -

Variable rate
 debt             $    -     $     -   $     -   $    -    $ 2,377   $    -   $  2,377  $  2,377

Weighted average
 interest rate         -           -         -        -       6.7%        -       6.7%      6.7%


</TABLE>



























                                       21
<PAGE>

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



             Report of Independent Registered Public Accounting Firm
             -------------------------------------------------------


To the Shareholders
AMREP Corporation
Princeton, New Jersey

We  have  audited  the  accompanying   consolidated   balance  sheets  of  AMREP
Corporation  and  subsidiaries  as of April 30,  2006 and 2005,  and the related
consolidated statements of income,  shareholders' equity and cash flows for each
of the three years in the period ended April 30, 2006.  Our audits also included
the financial  statement  schedule  listed in the Index at Item 15(a)(2).  These
financial  statements  and  schedule  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 the standards of the Public  Company
Accounting Oversight Board (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 consolidated  financial statements referred to above present
fairly, in all material  respects,  the financial  position of AMREP Corporation
and  subsidiaries  as of April  30,  2006 and  2005,  and the  results  of their
operations  and their cash flows for each of the three years in the period ended
April  30,  2006,  in  conformity  with  U.S.  generally   accepted   accounting
principles.   Also,  in  our  opinion,  the  related  financial  schedule,  when
considered in relation to the basic consolidated financial statements taken as a
whole, presents fairly in all material respects the information therein.


/s/ McGladrey & Pullen, LLP

Davenport, Iowa
June 13, 2006


























                                       22
<PAGE>

<TABLE>

<CAPTION>


                       AMREP CORPORATION AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                             APRIL 30, 2006 AND 2005
                          (Dollar amounts in thousands)

<S>                                                             <C>                  <C>

                                    ASSETS                            2006                 2005
                                     ------                     ----------------    -----------------

CASH AND CASH EQUIVALENTS                                        $      46,882       $      37,743

RECEIVABLES, net:
   Real estate operations                                               14,592               6,277
   Media services operations                                            37,140              51,348
                                                                ----------------    -----------------
                                                                        51,732              57,625

REAL ESTATE INVENTORY                                                   47,533              52,906

INVESTMENT ASSETS, net                                                  11,586              11,356

PROPERTY, PLANT AND EQUIPMENT, net                                      10,879              11,600

OTHER ASSETS, net                                                       15,238              12,347

ASSETS OF DISCONTINUED OPERATIONS                                           -                5,541

GOODWILL                                                                 5,191               5,191
                                                                ----------------    -----------------

     TOTAL ASSETS                                                 $    189,041        $    194,309
                                                                ================    =================

                      LIABILITIES AND SHAREHOLDERS' EQUITY
                      ------------------------------------

LIABILITIES:
ACCOUNTS PAYABLE AND ACCRUED EXPENSES                             $     39,382        $     50,733
DEFERRED REVENUE                                                         7,741                  -

NOTES PAYABLE:
   Amounts due within one year                                           1,673               2,099
   Amounts subsequently due                                              4,343               9,955
                                                                ----------------    -----------------
                                                                         6,016              12,054

TAXES PAYABLE                                                            4,548               2,220
DEFERRED INCOME TAXES                                                    9,150               6,117
ACCRUED PENSION COST                                                     3,234               5,780
                                                                ----------------    -----------------

     TOTAL LIABILITIES                                                  70,071              76,904
                                                                ----------------    -----------------
SHAREHOLDERS' EQUITY:
   Common stock, $.10 par value;
     shares authorized - 20,000,000; shares issued -  7,417,204 at
     April 30, 2006 and 7,414,704 at April 30, 2005                        741                 741
   Capital contributed in excess of par value                           45,772              45,395
   Retained earnings                                                    81,875              82,695
   Accumulated other comprehensive loss, net                            (4,072)             (5,976)
   Treasury stock, at cost                                              (5,346)             (5,450)
                                                                ----------------    -----------------
     TOTAL SHAREHOLDERS' EQUITY                                        118,970             117,405
                                                                ----------------    -----------------

     TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY                    $   189,041         $   194,309
                                                                ================    =================
</TABLE>

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

                                       23
<PAGE>

<TABLE>


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


                                                                                 Year Ended April 30,
                                                               -------------------------------------------------------
                                                                    2006                2005               2004
                                                               ---------------     ---------------    ----------------
   REVENUES:
      Real estate operations-
        Land sales                                             $    57,810         $    36,154        $     28,012

      Media services operations                                     88,463              96,913              99,791

      Interest and other                                             2,023               1,439               1,488
                                                               ---------------     ---------------    ----------------
                                                                   148,296             134,506             129,291
                                                               ---------------     ---------------    ----------------

   COSTS AND EXPENSES:
      Real estate cost of sales-
        Land sales                                                  26,732              16,105              13,634
      Operating expenses-
        Media services operations                                   73,956              79,324              83,020
        Real estate commissions and selling                          1,427               1,863                 923
        Other                                                        1,114               1,453               1,140
      General and administrative-
        Media services operations                                    7,686               8,507               8,801
        Real estate operations and corporate                         4,310               3,680               2,894
      Interest, net                                                    344                 660                 944
                                                               ---------------     ---------------    ----------------

                                                                   115,569             111,592             111,356
                                                               ---------------     ---------------    ----------------

   INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES            32,727              22,914              17,935

   PROVISION  FOR INCOME TAXES FROM CONTINUING OPERATIONS           10,233               7,326               6,638
                                                               ---------------     ---------------    ----------------

   INCOME FROM CONTINUING OPERATIONS                                22,494              15,588              11,297
   INCOME (LOSS) FROM OPERATIONS OF DISCONTINUED BUSINESS
        (NET OF INCOME TAXES)                                        3,556                 (63)                380
                                                               ---------------     ---------------    ----------------

   NET INCOME                                                  $    26,050         $    15,525         $    11,677
                                                               ===============     ===============    ================

   EARNINGS PER SHARE FROM CONTINUING OPERATIONS               $      3.39         $      2.36         $      1.71
   EARNINGS (LOSS) PER SHARE FROM DISCONTINUED OPERATIONS              .54               (0.01)               0.06
                                                               ---------------     ---------------    ----------------
   EARNINGS PER SHARE - BASIC AND DILUTED                      $      3.93         $      2.35         $      1.77
                                                               ===============     ===============    ================

   WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING              6,633               6,616               6,595
                                                               ===============     ===============    ================



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

                                       24
<PAGE>

<TABLE>

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

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


                                                           Capital                    Accumulated       Treasury
                                      Common Stock     Contributed in                    Other           Stock,
                                  -------------------     Excess of     Retained     Comprehensive         at
                                   Shares     Amount      Par Value     Earnings          Loss            Cost         Total
                                  -------    --------  ---------------  --------     -------------     ----------    ----------

BALANCE, April 30, 2003            7,407     $    741  $     44,992     $ 59,786     $    (6,034)      $  (5,657)    $  93,828

    Net income                         -            -             -       11,677               -               -        11,677

    Other comprehensive income         -            -             -            -           1,420               -         1,420
                                                                                                                     ----------

    Total comprehensive income                                                                                          13,097
                                                                                                                     ----------

    Cash dividends                     -            -             -       (1,648)              -               -        (1,648)


    Issuance of stock under
     Directors' Plan                   -            -           126            -               -             104           230

    Exercise of stock options          2            -            15            -               -               -            15
                                  -------    --------  ---------------  --------     -------------     ----------    ----------

BALANCE, April 30, 2004            7,409          741        45,133       69,815          (4,614)         (5,553)      105,522

    Net income                         -            -             -       15,525               -               -        15,525

    Other comprehensive (loss)         -            -             -            -          (1,362)              -        (1,362)
                                                                                                                     ----------

    Total comprehensive income                                                                                          14,163
                                                                                                                     ----------

    Cash dividends                     -            -             -       (2,645)              -               -        (2,645)

    Issuance of stock under
     Directors' Plan                   -            -           227          -                 -             103           330

    Exercise of stock options          6            -            35          -                 -              -             35
                                  -------    --------  ---------------  --------     -------------     ----------    ----------

BALANCE, April 30, 2005            7,415          741         45,395      82,695          (5,976)         (5,450)      117,405

    Net income                         -            -              -      26,050               -               -        26,050

    Other comprehensive income         -            -              -           -           1,904               -         1,904
                                                                                                                     ----------

    Total comprehensive income                                                                                          27,954
                                                                                                                     ----------

    Cash dividends                     -            -              -     (26,870)              -               -       (26,870)

    Issuance of stock under
     Directors' Plan                   -            -            337           -               -             104           441

    Exercise of stock options          2            -             40           -               -               -            40
                                  -------    --------  ---------------  --------     -------------     ----------    ----------

BALANCE, April 30, 2006            7,417     $    741   $     45,772    $ 81,875     $    (4,072)      $  (5,346)    $ 118,970
                                  =======    ========  ===============  ========     =============     ==========    ==========

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



                                       25
<PAGE>


<TABLE>

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

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

                                                                                                    Year Ended April 30,
                                                                                    ------------------------------------------------
                                                                                        2006              2005               2004
                                                                                    -----------       -------------     ------------
CASH FLOWS FROM OPERATING ACTIVITIES:
   Net income                                                                       $   26,050         $   15,525        $   11,677
   Adjustments to reconcile net income
    to net cash provided by operating activities-
    Depreciation and amortization                                                        5,568              5,343             5,015
    Non-cash credits and charges:
     (Gain) loss on disposition of assets                                               (5,345)                 -               619
     Provision for doubtful accounts                                                      (104)              (172)              680
     Pension (benefit) accrual                                                             627                303             ( 485)
     Stock based compensation - Directors' Plan                                            441                330               230
    Changes in assets and liabilities, excluding the effect of acquisitions:
     Receivables                                                                         4,202             (8,388)           (7,311)
     Real estate inventory                                                               6,942             (1,258)            4,863
     Other assets                                                                       (4,027)            (2,876)           (1,451)
     Accounts payable and accrued expenses and deferred revenue                          3,400              1,499             2,806
     Taxes payable`                                                                      2,328                353             1,262
     Deferred income taxes                                                               1,764              1,333             3,542
                                                                                    -----------       -------------     ------------
       Net cash provided by operating activities                                        41,846             11,992            21,447
                                                                                    -----------       -------------     ------------
CASH FLOWS FROM INVESTING ACTIVITIES:
   Capital expenditures - property, plant, and equipment                                (3,683)            (3,060)           (3,402)
   Capital expenditures - investment assets                                               (213)            (1,885)             (266)
   Deposit from condemnation of Utility Company                                              -              7,000                 -
   Proceeds from disposition of property, plant and equipment                            4,057               190                  -
   Acquisitions, net                                                                         -              (100)                 -
                                                                                    -----------       -------------     ------------
       Net cash provided (used) by investing activities                                    161              2,145            (3,668)
                                                                                    -----------       -------------     ------------
CASH FLOWS FROM FINANCING ACTIVITIES:
   Proceeds from debt financing                                                         29,162             25,596            27,831
   Principal debt payments                                                             (35,200)           (26,185)          (33,615)
   Exercise of stock options                                                                40                 35                15
   Cash dividends                                                                      (26,870)            (2,645)           (1,648)
                                                                                    -----------       -------------     ------------
       Net cash (used) by financing activities                                         (32,868)            (3,199)           (7,417)
                                                                                    -----------       -------------     ------------

INCREASE IN CASH AND CASH EQUIVALENTS                                                    9,139             10,938            10,362
CASH AND CASH EQUIVALENTS, beginning of year                                            37,743             26,805            16,443
                                                                                    -----------       -------------     ------------
CASH AND CASH EQUIVALENTS, end of year                                              $   46,882         $   37,743        $   26,805
                                                                                    ===========       =============     ============

SUPPLEMENTAL CASH FLOW INFORMATION:
   Interest paid - net of amounts capitalized                                       $      377         $      568        $      822
                                                                                    ===========       =============     ============

   Income taxes paid - net of refunds                                               $    8,230         $    6,817        $    2,049
                                                                                    ===========       =============     ============
   Non-cash transaction:
     Note payable for acquisition of   Distribution contracts                       $        -         $    1,170        $        -
     Foreclosure on land sale contract                                              $    1,795         $        -        $        -
     Transfer of development costs from inventory to investment assets              $      262         $        -        $        -
                                                                                    ===========       =============     ============

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


                                       26
<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 primarily engaged in three business segments.  AMREP Southwest
Inc. ("AMREP  Southwest")  operates in the real estate industry,  principally in
New Mexico, and Kable Media Services, Inc. ("Kable") operates in the fulfillment
services and magazine  distribution  services businesses  (collectively,  "media
services  operations").  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.

         Fiscal Year
         -----------

The Company's  fiscal year ends on April 30. All  references  to 2006,  2005 and
2004 mean the  fiscal  years  ended  April 30,  2006,  2005 and 2004  unless the
context otherwise indicates.

            Revenue recognition
            -------------------

Real Estate
-----------

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,  title and other
attributes  of ownership  have been  conveyed to the buyer by means of a closing
and the Company is not obligated to perform further  significant  development of
the specific  property sold. 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.

Cost of land  sales  includes  all  direct  acquisition  costs and  other  costs
specifically identified with the property,  including  pre-acquisition costs and
capitalized real estate taxes and interest,  and an allocation of certain common
development costs associated with the entire project.  Common  development costs
include the installation of utilities and roads, and may be based upon estimates
of cost to complete. The allocation of costs is based on the relative fair value
of the property before development.  Estimates and cost allocations are reviewed
on a regular basis until a project is substantially  completed,  and are revised
and reallocated as necessary on the basis of current estimates.

During  2006,  the Company  entered  into one sale that  requires the Company to
complete  certain  development  work subsequent to closing.  Additional sales of
this  nature  are  likely  to be  entered  into in  fiscal  year  2007.  In such
situations,  sales  are  recorded  under  the  percentage-of-completion  method.
Revenues and cost of sales are recorded as development  work is performed  based
on the percentage that incurred costs to date bear to the Company's estimates of
total costs and contract value. Cost estimates include direct and indirect costs
such as labor,  materials and overhead.  If a contract  extends over an extended
period,  revisions in cost estimates  during the progress of work would have the
effect of adjusting  earnings  applicable to performance in prior periods in the
current period.  When the current contract estimate indicates a loss,  provision
is made for the total  anticipated  loss in the  current  period.  Consideration
received in excess of amounts  recognized as land sale revenues is accounted for
as deferred revenue.




                                       27
<PAGE>

Media Services
--------------

Revenues from media services  operations  include revenues from the distribution
of periodicals and subscription fulfillment and other activities.  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. In accordance with Emerging Issues Task
Force (EITF) Issue No. 99-19, "Reporting Revenue Gross as a Principal versus Net
as an Agent", certain reimbursed postage costs are accounted for on a net basis.
Distribution  revenues  represent  commissions  earned from the  distribution of
publications  for client  publishers and are recorded by the Company at the time
the publications go on sale at the retail level, in accordance with SFAS No. 48,
"Revenue Recognition When Right of Return Exists".  Because the publications are
sold throughout the distribution chain on a fully-returnable basis in accordance
with prevailing  industry  practice,  the Company provides for estimated returns
from  wholesalers at the time the  publications  go on sale by charges to income
that  are  based  on  historical  experience  and  most  recent  sales  data for
publications on a  issue-by-issue  basis, and then  simultaneously  provides for
estimated credits from publishers for the related returns. Accordingly, revenues
represent the  difference  between the  Company's  estimates of its net sales to
independent wholesalers and its net purchases from publisher clients.  Estimates
are continually  reevaluated  throughout the sales process, and final settlement
is typically made 90 days after a magazine's "off-sale" date.

         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.

         Receivables
         -----------

Receivables  are carried at original  invoice or closing  statement  amount less
estimates  made  for  doubtful  receivables  and,  in the  case of  distribution
receivables,  return  allowances.   Management  determines  the  allowances  for
doubtful  accounts by reviewing and identifying  troubled  accounts on a monthly
basis and by using  historical  experience  applied to an aging of  accounts.  A
receivable is considered to be past due if any portion of the receivable balance
is outstanding  for more than 90 days.  Receivables  are written off when deemed
uncollectible.  Recoveries of  receivables  previously  written off are recorded
when received.

         Real estate inventory
         ---------------------

Land and improvements on land 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.

         Investment assets
         -----------------

Investment assets consist of investment land and commercial rental properties.

Investment land represents vacant,  undeveloped land not held for development or
sale in the normal  course of business  and which is stated at the lower of cost
or fair  market  value  less the  estimated  costs to  sell.  Commercial  rental
properties are recorded at cost less accumulated  depreciation.  Depreciation of
commercial  rental  properties is provided by the  straight-line  basis over the
estimated  useful  lives,  which  generally  are 10 years or less for  leasehold
improvements and 40 years for buildings.

         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 that 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.

                                       28
<PAGE>

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  generally  are 10 years or less for  furniture  and  fixtures  (including
equipment) and 25 to 40 years for buildings.

         Goodwill
         --------

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 in 1969 and, since
this  acquisition was made prior to the effective date of Accounting  Principles
Board Opinion ("APB") No. 17, was not amortized.

Effective  May 1, 2002,  the Company  adopted SFAS No. 142,  "Goodwill and Other
Intangible  Assets".  Under SFAS No. 142, goodwill and intangible assets with an
indefinite  life are no longer  subject to  amortization  and are  reviewed  for
impairment at least annually.  An impairment  charge is recognized only when the
calculated fair value of a reporting unit, including goodwill,  is less than its
carrying amount. Based on a review completed in April 2006, the Company believes
that no goodwill impairment existed at April 30, 2006.

         Long-lived assets
         -----------------

Long-lived  assets,  including  real  estate  inventory,  investment  assets and
property,  plant and equipment,  are evaluated in accordance  with SFAS No. 144,
"Accounting for the Impairment or Disposal of Long-Lived  Assets",  and reviewed
for  impairment  when events or changes in  circumstances  indicate the carrying
value of an asset may not be recoverable. Provisions for impairment are recorded
when  undiscounted cash flows estimated to be generated by those assets are less
than the carrying amount of the assets.  The amount of impairment would be equal
to the difference  between the assets'  carrying  value and the discounted  cash
flows.

         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  issues  stock  options  to   non-employee   directors   under  the
Non-Employee Directors Option Plan (see note 10). The Company accounts for stock
option grants in  accordance  with APB No. 25,  "Accounting  for Stock Issued to
Employees",  and has adopted the  disclosure-only  provisions of SFAS No. 123 as
amended by SFAS No. 148, "Accounting for Stock-Based Compensation-Transition and
Disclosure".  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
plan.  Further,  the amount of  additional  compensation  disclosable  under the
disclosure-only  provisions  of SFAS  No.  123 is  immaterial  for  all  periods
presented.

         Comprehensive income (loss)
         ---------------------------

Comprehensive  income  (loss) is defined as the change in equity during a period
from transactions and other events from non-owner sources.  Comprehensive income
(loss) is the total of net income and other  comprehensive  income (loss) which,
for the Company,  is comprised  entirely of the minimum pension liability net of
the related deferred income taxes.


                                       29
<PAGE>

         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, real estate
inventory  valuation and related  revenue  recognition,  allowances for magazine
returns and  doubtful  accounts,  the  recoverability  of  long-term  assets and
amortization periods,  pension plan assumptions and legal contingencies.  Actual
results could differ from these estimates;  however, there have been no material
changes made to the Company's accounting estimates in the past three years.

         New and Emerging Accounting Standards
         -------------------------------------

In May 2005, the Financial  Accounting  Standards Board ("FASB") issued SFAS No.
154,  "Accounting  Changes  and  Error  Corrections".   SFAS  No.  154  requires
restatement  of prior  periods'  financial  statements for changes in accounting
principle,  unless it is impracticable  to determine either the  period-specific
effects or the cumulative effect of the change. Also, SFAS No. 154 requires that
retrospective  application of a change in accounting principle be limited to the
direct effects of the change.  SFAS No. 154 is effective for accounting  changes
and  corrections  of errors made in fiscal years  beginning  after  December 15,
2005.

In June 2005,  the FASB ratified EITF Issue No. 04-10,  "Determining  Whether to
Aggregate Operating Segments That Do Not Meet the Quantitative  Thresholds." The
standard is effective for fiscal years ending after September 15, 2005, and does
not  effect the  current  presentation  of the  Company's  reportable  operating
segments.

In November 2005, the FASB issued FASB Staff Position  ("FSP") FAS 115-1 and FAS
124-1,  "The Meaning of  Other-Than-Temporary  Impairment and Its Application to
Certain  Investments." The FSP provides guidance regarding when an investment is
impaired, whether that impairment is other than temporary and measurement of the
impairment  loss. The FSP applies to debt and equity  securities,  except equity
securities  accounted  for under the equity  method.  The FSP is  effective  for
reporting  periods  beginning  after December 15, 2005. The Company is currently
evaluating the  application of the FSP to determine its potential  impact on its
consolidated financial statements.

In addition  to the  recently  issued  accounting  standards,  there are several
emerging   accounting  issues  that  could  potentially   impact  the  Company's
consolidated  financial statements in the future,  including (i) a proposed SFAS
on "Fair Value Measurements" (exposure draft); (ii) a proposed Interpretation on
"Accounting  for Uncertain Tax Positions - an  interpretation  of FASB Statement
No. 109 (exposure  draft)";  and (iii) a proposed SFAS  "Accounting for Pensions
and Other Postretirement Benefits (preliminary views)".

The Company will monitor these  emerging  issues to assess any potential  future
impact on its consolidated financial statements.

(2)        DISCONTINUED OPERATIONS:
           ------------------------

Net income  from  discontinued  operations  in 2006  reflects  the gain from the
disposition of the primary  assets of the Company's El Dorado,  New Mexico water
utility subsidiary, which were taken through condemnation proceedings. Financial
information  for  operations  of this  subsidiary  for  prior  periods  has been
reclassified to conform to this presentation.

Revenues  of the water  utility  subsidiary  were:  2005 -  $1,210,000  (through
November  30, 2004) and 2004 -  $1,816,000.  Pretax  income  (loss) of the water
utility subsidiary was: 2005 - $(100,000) (through November 30, 2004) and 2004 -
$595,000.







                                       30
<PAGE>


(3)      RECEIVABLES:
         ------------

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


Receivables consist of:                                                     April 30,
                                                               -------------------------------------
                                                                     2006                 2005
                                                               ----------------    -----------------
                                                                            (Thousands)
Real estate operations-
   Mortgage and other receivables                               $      14,688       $      6,373
   Allowance for doubtful accounts                                        (96)               (96)
                                                               ----------------    -----------------
                                                                $      14,592       $      6,277
                                                               ================    =================
Media services operations (maturing within one year)-
    Fulfillment services                                        $      20,266       $     24,487
    Newsstand Distribution Services, net of estimated returns          18,409             28,502
                                                               ----------------    -----------------
                                                                       38,675             52,989
     Allowance for doubtful accounts                                   (1,535)            (1,641)
                                                               ----------------    -----------------
                                                                $      37,140       $     51,348
                                                               ================    =================
</TABLE>


The Company  extends  credit to various  companies  in its real estate and media
services  businesses  that 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.
Approximately  47% and 44% of media  services net accounts  receivable  were due
from  three  customers  at  April  30,  2006  and  2005.  As  a  result  of  the
concentration of accounts  receivable in three  customers,  the Company could be
adversely  affected by adverse  changes in their  financial  condition  or other
factors negatively  affecting these companies.  As industry practices allow, the
Company's  policy is to  manage  its  exposure  to credit  risk  through  credit
approvals  and limits and, on occasion  (particularly  in  connection  with real
estate land  sales),  the taking of  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.

Real  estate  mortgages  receivable  includes  one  mortgage  in the  amount  of
$9,557,000  that was received as partial  payment in connection with a land sale
in April 2006 and paid in full in June 2006.  Pursuant to the terms of the sale,
the buyer also provided a "loan reserve  letter of credit" which  guarantees the
Company  payment for certain  remaining  development  obligations it retained in
connection  with the sale,  which is being  accounted for on the  "percentage of
completion"  method (see note 1,  "Revenue  recognition  - Real  Estate").  Real
estate  mortgage  receivables  bear interest at rates ranging from 8.0% to 10.0%
and result  primarily  from land sales.  Maturities  of principal on real estate
receivables  at April  30,  2006 were as  follows:  2007 -  $11,402,000;  2008 -
$3,249,000; 2009 - $37,000.

Because the  publications  distributed  by the Company are sold  throughout  the
distribution  chain on a  fully-returnable  basis in accordance  with prevailing
industry  practice,  the Company provides for estimated returns from wholesalers
at the time the  publications  go on sale by charges to income that are based on
historical  experience  and  most  recent  sales  data  for  publications  on an
issue-by-issue  basis, and then  simultaneously  provides for estimated  credits
from  publishers  for  the  related  returns.  Newsstand  Distribution  Services
accounts receivable are net of estimated magazine returns of $54,071,000 in 2006
and $57,524,000 in 2005.

Media services operations receivables collateralize  line-of-credit arrangements
utilized for the Newsstand  Distribution and Fulfillment service operations (see
note  9).  Both of  these  business  segments  provide  services  to  publishing
companies owned or controlled by a major  shareholder and member of the Board of
Directors.   Commissions  and  other  revenues  earned  on  these   transactions
represented  approximately 2% of consolidated revenues in each of 2006, 2005 and
2004.

In  connection  with one  customer  arrangement  in the  Newsstand  Distribution
Services  business,  a publisher has  guaranteed the collection of the Company's
related accounts  receivable from wholesalers to whom the Company has resold the
publisher's magazines by allowing an offset of past due or uncollectible amounts
from  wholesalers  against  amounts  due  the  publisher  for  the  purchase  of
magazines. Pursuant to this arrangement, the Company has the right of offset and
has offset  $20,368,000  of accounts  receivable  at April 30, 2006  against the
related accounts payable.


                                       31
<PAGE>

(4)     REAL ESTATE INVENTORY:
        ----------------------

Real  estate  inventory  consists  of land  and  improvements  held  for sale or
development.  Accumulated  capitalized  interest  costs  included in real estate
inventory at April 30, 2006 and 2005 were  $2,644,000 and  $2,825,000.  Interest
costs capitalized during 2006, 2005 and 2004 were $21,000, $65,000 and $126,000.
Accumulated  capitalized real estate taxes included in the inventory of land and
improvements  at April 30, 2006 and 2005 were  $2,191,000 and  $2,635,000.  Real
estate taxes  capitalized  during 2006, 2005 and 2004 were $16,000,  $18,000 and
$42,000.  Previously capitalized interest costs and real estate taxes charged to
real estate cost of sales were $662,000,  $883,000,  and $608,000 in 2006,  2005
and 2004, and $64,000 was charged to commercial rental properties in 2005.

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

(5)      INVESTMENT ASSETS:
         ------------------

<TABLE>
<S>                                                   <C>                 <C>
Investment assets consist of:
                                                                    April 30,
                                                      -------------------------------------
                                                            2006                 2005
                                                      --------------       ----------------
                                                                   (Thousands)

Land held for long-term investment                     $     6,800          $      6,573
                                                      --------------       ----------------
Commercial rental properties-
    Land, buildings and improvements                         7,051                 6,839
    Furniture and fixtures                                     216                   216
                                                      --------------       ----------------
                                                             7,267                 7,055
    Less accumulated depreciation                           (2,481)               (2,272)
                                                      --------------       ----------------
                                                             4,786                 4,783
                                                      --------------       ----------------
                                                       $    11,586          $     11,356
                                                      ==============       ================


Land held for long-term  investment  represents  property  located in areas that
will not be developed in the near term and thus has not been offered for sale.

Depreciation  charged to operations amounted to $209,000,  $140,000 and $137,000
in 2006, 2005 and 2004.

(6)      PROPERTY, PLANT AND EQUIPMENT:
         ------------------------------

Property, plant and equipment consists of:
                                                                    April 30,
                                                      ------------------------------------
                                                             2006               2005
                                                      --------------       ---------------
                                                                  (Thousands)

Land, buildings and improvements                       $     4,397          $      4,139
Furniture and equipment                                     30,117                27,317
Other                                                           96                   116
                                                      --------------       ---------------
                                                            34,610                31,572
Less accumulated depreciation                              (23,731)              (19,972)
                                                      --------------       ---------------
                                                       $    10,879          $     11,600
                                                      ==============       ===============


Depreciation  charged to  operations  amounted  to  $4,222,000,  $4,001,000  and
$4,100,000 in 2006, 2005 and 2004.

</TABLE>



                                       32
<PAGE>

(7)      OTHER ASSETS:
         -------------

<TABLE>
<S>                                                   <C>                 <C>
Other assets consist of:
                                                                    April 30,
                                                      ------------------------------------
                                                            2006                 2005
                                                      --------------       ---------------
                                                                 (Thousands)

Software development costs                             $     7,787          $      7,296
Deferred order entry costs                                   3,872                 3,745
Prepaid expenses                                             2,137                 1,587
Other                                                        3,841                 3,674
                                                      --------------       ---------------
                                                            17,637                16,302
Less accumulated amortization                               (2,399)               (3,955)
                                                      --------------       ---------------
                                                       $    15,238          $     12,347
                                                      ==============       ===============

Software   development   costs  include  internal  and  external  costs  of  the
development  of new or enhanced  software  programs and are generally  amortized
over five  years.  Deferred  order  entry  costs  represent  costs  incurred  in
connection with the data entry of customer subscription information to data base
files and are  charged  directly to  operations  over a 12-month  period.  Other
includes  the costs of customer  contracts  acquired  in  November  2004 and are
amortized over four years.

Amortization related to deferred charges was $1,137,000, $1,202,000 and $778,000
in 2006, 2005 and 2004.

Amortization  of Other assets for each of the next five years is estimated to be
as follows:  2007 -  $2,098,000;  2008 - $2,079,000;  2009 - $1,640,000;  2010 -
$1,512,000; and 2011 - $1,148,000.

(8)      ACCOUNTS PAYABLE AND ACCRUED EXPENSES:
         --------------------------------------

Accounts payable and accrued expenses consist of:
                                                                   April 30,
                                                      ------------------------------------
                                                             2006                 2005
                                                      --------------       ---------------
                                                                 (Thousands)

Publisher payables, net                                $    27,273          $     27,722
Accrued expenses                                             4,320                 6,849
Trade payables                                               2,602                 3,827
Other                                                        5,187                 5,335
Deposit on utility company condemnation                         -                  7,000
                                                      --------------       ---------------
                                                       $    39,382          $     50,733
                                                      ==============       ===============

(9)      DEBT FINANCING:
         ---------------

Debt financing consists of:
                                                                   April 30,
                                                      ------------------------------------
                                                            2006                  2005
                                                      --------------       ---------------
                                                                  (Thousands)
Notes payable -
   Line-of-credit borrowings -
     Real estate operations and other                  $        -           $         -
     Media services operations                               2,377                 7,505
   Other notes payable                                       3,639                 4,549
                                                      --------------       ---------------
                                                       $     6,016          $     12,054
                                                      ==============       ===============
</TABLE>

Maturities of principal on notes  outstanding at April 30, 2006 were as follows:
2007 - $1,673,000; 2008 - $1,419,000; 2009 - $290,000; 2010 - $257,000; and 2011
- $2,377,000.



                                       33
<PAGE>

         Lines-of-credit and other borrowings
         ------------------------------------

AMREP  Southwest  has a loan  agreement  with a bank  with a  maximum  borrowing
capacity of $10,000,000  that may be used to support real estate  development in
New Mexico. The loan is uncollateralized  and bears interest at the bank's prime
rate less 0.75% or, at the borrower's  option, a LIBOR-based  interest rate plus
2.0%.  At  April  30,  2006,  there  were no  balances  outstanding  under  this
arrangement.   The  credit  agreement  contains  certain  covenants,   the  most
significant  of which limit other  borrowings  and require the  maintenance of a
minimum  tangible  net worth (as defined)  and a certain  level of  unencumbered
inventory. This credit arrangement matures in October 2008.

Kable's  subsidiaries  that  comprise its  Fulfillment  Services  and  Newsstand
Distribution  Services  segments  have a  credit  arrangement  with a bank  that
matures  in 2010  and  allows  separate  revolving  credit  borrowings  for each
business of up to $11,000,000 for Fulfillment  Services and up to $9,000,000 for
Newsstand Distribution Services, in each case based upon a prescribed percentage
of the borrower's eligible accounts receivable.  The individual credit lines are
collateralized  by  substantially  all of  each  borrower's  assets  (consisting
principally  of  accounts  receivable  and  machinery  and  equipment)  and bear
interest  at the  bank's  prime  rate  (7.75%  at April  30,  2006)  or,  at the
borrower's option, a reserve adjusted  overnight or 30-day LIBOR-based  interest
rate  (4.94% at April 30,  2006)  plus,  in either  case,  a margin  established
quarterly of from 1.75% to 2.50%  dependent upon the  borrower's  funded debt to
EBITDA ratio, as defined.  At April 30, 2006, the borrowing  availability of the
Fulfillment  Services  business was  $10,216,000  against which  $1,898,000  was
outstanding,  the borrowing  availability of the Newsstand Distribution Services
business was $7,997,000 against which $479,000 was outstanding, and the interest
rate for  outstanding  borrowings  was 6.69% based on the  overnight  LIBOR rate
option.  The loan agreement  requires the  maintenance or achievement of certain
financial ratios and contains certain  covenants,  the most significant of which
limit  the  amount  of  dividends  and  other  payments  that may be made by the
borrowers to their parent or other affiliates,  as well as capital  expenditures
and other  borrowings.  An additional  $2,007,600 is available under this credit
arrangement for capital expenditures.

Other notes  payable  consist of  equipment  financing  loans and a note payable
related to the acquisition of distribution  contracts,  with a weighted  average
interest rate of 5.2% in 2006 and 4.8% in 2005.

In May, 2006,  Kable's credit agreement was amended to provide for an additional
$10,000,000  revolving  loan  to a  subsidiary  of  the  Newsstand  Distribution
Services  business  on  the  same  terms  as  provided  in the  existing  credit
agreement.  The  proceeds  of  borrowings  under  this  arrangement  may be used
exclusively  for the payment of accounts  payable under a magazine  distribution
agreement  with  one of the  borrower's  publisher  customers.  Subject  to such
maximum  loan  amount,  up to 40%  of the  amount  of  the  borrower's  accounts
receivable  from the  distribution  of  magazines  covered  by the  distribution
agreement with that customer may be borrowed.  The amendment also provided for a
secured term loan to the Fulfillment  Services  business of $1,470,000,  bearing
interest  at the rate of 6.25%  and  repayable  in  equal  monthly  installments
through  2010,  the proceeds of which were  applied to the  financing of certain
equipment.

(10)     BENEFIT PLANS:
         --------------

         Retirement plan
         ---------------

The Company has a retirement plan for which accumulated benefits were frozen and
future service credits were curtailed as of March 1, 2004. Prior to that date it
had covered  substantially  all full-time  employees and provided benefits based
upon  a  percentage  of the  employee's  annual  salary.  The  following  tables
summarize the balance sheet impact as well as the benefit  obligations,  assets,
funded status and assumptions associated with the retirement plan.










                                       34
<PAGE>


Net periodic  pension cost (income) for 2006, 2005 and 2004 was comprised of the
following components:

<TABLE>
<S>                                                      <C>                <C>                <C>
                                                                       Year Ended April 30,
                                                         -----------------------------------------------------
                                                              2006               2005               2004
                                                         ---------------    ----------------   ---------------
                                                                              (Thousands)
Service cost (including plan expenses)                    $        212       $         124      $        784
Interest cost on projected
   benefit obligation                                            1,780               1,817             1,762
Expected return on assets                                       (1,994)             (2,064)           (1,793)
Amortization of prior service cost                                   -                   -              (293)
Recognized net actuarial loss                                      629                 426               741
                                                         ---------------    ----------------   ---------------
Pension cost for normal activity                                   627                 303             1,201
(Gain) on curtailment                                                -                   -            (1,686)
                                                         ---------------    ----------------   ---------------
Total cost (benefit) recognized in pretax  income                  627                 303              (485)
Cost (benefit) recognized in pretax other
    comprehensive income                                        (3,173)              2,271            (2,368)
                                                         ---------------    ----------------   ---------------
                                                          $     (2,546)      $       2,574      $     (2,853)
                                                         ===============    ================   ===============

Assumptions used in determining net periodic pension cost were:

                                                                      Year Ended April 30,
                                                       -----------------------------------------------------------
                                                             2006                 2005                 2004
                                                       -----------------    -----------------    -----------------

Discount rates                                               5.75%                5.75%                6.25%
Expected long-term rate of return
   on assets                                                  8.0%                 8.0%                 8.0%
</TABLE>


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:

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

                                                                                 April 30,
                                                                       -------------------------------
                                                                           2006              2005
                                                                       -------------    --------------
                                                                                (Thousands)
Change in benefit obligation:
    Benefit obligation at beginning of year                             $  31,808         $   30,048
    Interest cost                                                           1,780              1,817
    Actuarial loss                                                            418              1,821
    Benefits paid                                                          (1,847)            (1,878)
                                                                       -------------    --------------
    Benefit obligation at end of year                                   $  32,159         $   31,808
                                                                       -------------    --------------

Change in plan assets:
    Fair value of plan assets at beginning of year                      $  26,028         $   26,842
    Actual return on plan assets                                            4,924              1,276
    Benefits paid                                                          (1,847)            (1,878)
    Expenses paid                                                            (180)              (212)
                                                                       -------------    --------------
    Fair value of plan assets at end of year                            $  28,925         $   26,028
                                                                       -------------    --------------

Funded status                                                           $  (3,234)        $   (5,780)
Unrecognized net actuarial loss                                             6,788              9,961
                                                                       -------------    --------------
Net amount recognized in the balance sheets                             $   3,554         $    4,181
                                                                       =============    ==============

Amounts recognized on the balance sheets:
    Accrued pension costs                                               $  (3,234)        $   (5,780)
    Pre-tax accumulated comprehensive loss                                  6,788              9,961
                                                                       -------------    --------------
                                                                        $   3,554         $    4,181
                                                                       =============    ==============

</TABLE>




                                       35
<PAGE>

The average asset allocation for the retirement plan was as follows:
                                                            April 30,
                                                 -------------------------------
                                                      2006             2005
                                                 -------------    --------------
    Equity securities                                  78%              75%
    Fixed income securities                            19               22
    Other (principally cash and cash equivalents)       3                3
                                                 -------------    --------------
    Total                                             100%             100%
                                                 =============    ==============

The Company  recorded other  comprehensive  income (loss) of $1,904,000 in 2006,
($1,362,000)  in 2005 and  $1,420,000  in 2004 to account  for the net effect of
changes to the unfunded pension liability.

The  investment mix between  equity  securities  and fixed income  securities is
based upon achieving a desired return by balancing higher return,  more volatile
equity securities and lower return, less volatile fixed income securities.  Plan
assets are invested in portfolios of diversified  public-market equity and fixed
income  securities.  Investment  allocations are made across a range of markets,
industry  sectors,  capitalization  sizes,  and,  in the  case of  fixed  income
securities,  maturities and credit quality.  The plan holds no securities of the
Company.

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

The Company funds the retirement plan according to IRS funding  limitations.  In
2004,  $1,025,000  was paid by the Company to the plan.  No  contributions  were
required  in 2006 or 2005.  The  amount of future  annual  benefit  payments  is
expected to be between $2.0 million and $2.3 million in 2007 through  2011,  and
an aggregate of  approximately  $11.5 million is expected to be paid in the five
year period 2012-2016.

          Savings and salary deferral plan
          ---------------------------------

The Company has a Savings and Salary  Deferral Plan,  commonly  referred to as a
401(k) plan, in which all full-time employees with more than one year of service
are eligible to participate  and contribute to through  salary  deductions.  The
Company may make discretionary matching  contributions,  subject to the approval
of its Board of Directors.  As of March 1, 2004,  the Company  matches 66.67% of
eligible  employees'  defined  contributions  up to a  maximum  of  4%  of  such
employees'  compensation.  Prior to March 1, 2004, the matching contribution was
33.33%  of  each  employee's  defined  contribution  up  to a  maximum  of 2% of
compensation.  The Company's  contribution to the plan amounted to approximately
$832,000, $841,000 and $389,000 in 2006, 2005 and 2004.

         Directors' stock plan
         ---------------------

During  2003,  the  Company  adopted  the AMREP  Corporation  2002  Non-Employee
Directors' Stock Plan and reserved 65,000 shares of common stock for issuance to
non-employee  directors.  Under the plan, each  non-employee  director  receives
1,250 shares of stock on each March 15 and  September 15 as partial  payment for
services rendered.  The expense recorded based upon the fair market value of the
stock at time of issuance under this plan was $441,000, $330,000 and $230,000 in
2006,  2005 and 2004  (15,000  shares  issued in each year).  At April 30, 2006,
12,500 shares remained available for grant.

         Stock option plan
         -----------------

The Company had in effect a stock option plan that  provided  for the  automatic
issuance  of  an  option  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.  The Board of Directors  terminated  the plan following the annual grants
that were made in September 2005.



                                       36
<PAGE>

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


                                                                   Year Ended April 30,
                                    -----------------------------------------------------------------------
                                            2006                    2005                      2004
                                    --------------------   -----------------------   ----------------------
<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                   7,000     $ 14.92      9,500        $ 9.12        9,000     $ 6.30

Granted                               3,000       24.88      3,000         17.55        3,000      15.19
Exercised                            (2,500)      16.13     (5,500)         6.34       (2,500)      6.23
Expired or canceled                    (500)      17.56          -             -            -          -
                              -------------------      -------------------        -----------------
Options outstanding at
  end of year                         7,000       18.56      7,000         14.92        9,500       9.12
                              ===================      ===================        =================

Available for grant at
  end of year                             -                 12,000                     15,000
                              ===================      ===================        =================

Options exercisable at
  end of year                         4,000                  4,000                      6,500
                              ===================      ===================        =================

Range of exercise prices
  for options exercisable
  at end of year               $3.95 to $24.88           $3.95 to $17.55           $3.95 to $8.45
                              ===================      ===================        =================
</TABLE>

Options  outstanding at April 30, 2006 were  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, 2006,  2005 and 2004 was
3.9,  3.6,  and 3.2 years.  The weighted  average fair value of options  granted
during  the year was $8.07 in 2006,  $5.57 in 2005 and  $4.82 in 2004.  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 2006, 2005 and 2004:  expected volatility of 42%,
42% and 44%; risk-free interest rates of 5.0%, 2.8% and 2.0%; 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 plan. Further,  the
amount  of  additional   compensation   disclosable  under  the  disclosure-only
provisions of SFAS No. 123 is immaterial for all periods presented.

(11)    INCOME TAXES:
        -------------

The provision for income taxes consists of the following:
<TABLE>
<S>                                                     <C>                  <C>                 <C>

                                                                         Year Ended April 30,
                                                        -------------------------------------------------------
                                                             2006                2005                2004
                                                        ----------------    ---------------     ---------------
                                                                            (Thousands)
Current:
    Federal                                               $   9,735           $   5,770            $  2,961
    State and local                                             823                 488                 350
                                                        ----------------    ---------------     ---------------
                                                             10,558               6,258               3,311
                                                        ----------------    ---------------     ---------------
Deferred:
    Federal                                                   1,587                 928               3,011
    State and local                                             176                 103                 531
                                                        ----------------    ---------------     ---------------
                                                              1,763               1,031               3,542
                                                        ----------------    ---------------     ---------------
Total provision for income taxes                          $  12,321           $   7,289            $  6,853
                                                        ================    ===============     ===============

</TABLE>



                                       37
<PAGE>

The provision for income taxes has been allocated as follows:
<TABLE>
<S>                                                     <C>                  <C>                 <C>

                                                                         Year Ended April 30,
                                                        -------------------------------------------------------
                                                             2006                2005                2004
                                                        ----------------    ---------------     ---------------
                                                                            (Thousands)

Continuing operations                                     $  10,233           $   7,326            $  6,638
Discontinued operations                                       2,088                 (37)                215
                                                        ----------------    ---------------     ---------------
Total provision for income taxes                          $  12,321           $   7,289            $  6,853
                                                        ================    ===============     ===============
</TABLE>

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

                                                             April 30,
                                                --------------------------------
                                                    2006                2005
                                                ------------       -------------
                                                          (Thousands)
Deferred income tax assets-
     State tax loss carryforwards               $     3,844         $    4,902
     Accrued pension costs                            1,302              2,316
     Other                                            1,855              1,562
                                                -------------      -------------
     Total deferred income tax assets                 7,001              8,780
                                                -------------      -------------

Deferred income tax liabilities-
     Real estate basis differences                   (2,097)            (2,022)
     Reserve for periodical returns                  (1,434)            (1,470)
     Depreciable assets                              (3,485)            (3,369)
     Deferred condemnation gain                      (1,450)                 -
     Capitalized costs for financial reporting
       purposes, expensed for tax                    (4,060)            (3,281)
                                                --------------     -------------
     Total deferred income tax liabilities          (12,526)           (10,142)
                                                --------------     -------------

     Valuation allowance for realization of
        state tax loss carry forwards                (3,625)            (4,755)
                                                --------------     -------------
Net deferred income tax liability               $    (9,150)        $   (6,117)
                                                ==============     =============

The following  table  reconciles  taxes computed at the U.S.  federal  statutory
income tax rate from continuing operations to the Company's actual tax provision
(benefit):
<TABLE>
<S>                                                     <C>                  <C>                 <C>

                                                                         Year Ended April 30,
                                                        --------------------------------------------------------
                                                             2006                2005                2004
                                                        -----------------   ---------------     ----------------
                                                                                   (Thousands)
Computed tax provision at
  statutory rate                                          $  11,455           $   8,020            $  6,098
Increase (reduction) in tax resulting from:
     State income taxes, net of federal
       income tax effect                                        552                 395                 717
     Real estate charitable land contribution                (1,543)             (1,093)               (237)
     Other                                                     (231)                  4                  60

                                                        -----------------   ---------------     ----------------
Actual tax provision                                      $  10,233           $   7,326            $  6,638
                                                        =================   ===============     ================
</TABLE>

 (12)    SHAREHOLDERS' EQUITY:
         ---------------------

The Company  recorded other  comprehensive  income (loss) of $1,904,000 in 2006,
($1,362,000)  in 2005 and  $1,420,000  in 2004 to account  for the net effect of
changes to the unfunded pension liability (see note 10).

In connection with the 2002 Non-Employee Directors' Stock Plan, 15,000 shares of
common stock were issued from treasury  stock in each of 2006,  2005 and 2004 to
members of the Board of Directors as partial  compensation  for  services.  As a
result,  there were 773,592 and 788,592 shares held in the treasury at April 30,
2006 and 2005.

                                       38
<PAGE>

(13)     ACQUISITION:
         ------------

In November 2004, Kable's Distribution Services subsidiary purchased a portfolio
of magazine  distribution  contracts for a total purchase price of approximately
$1,270,000,  consisting of cash ($100,000) and a note payable ($1,170,000).  The
purchase  price  was  capitalized  and  is  included  in  Other  Assets  on  the
accompanying consolidated balance sheets.

(14)     COMMITMENTS AND CONTINGENCIES:
         ------------------------------

         Land sale contracts
         -------------------

As of April 30, 2006, the Company had entered into a sales contract for the sale
of  approximately  400  single-family   lots  for  a  total  purchase  price  of
approximately $18 million. This sale closed in April 2006; however,  because the
Company retained an ongoing obligation to complete  development of this project,
revenue is  recognized  under the  percentage  of  completion  method.  In 2006,
billings  under  the  contract  totaled  $11,945,000,  of which  $4,204,000  was
recognized as revenue and  $7,741,000  was deferred.  The balance of the revenue
will be recognized as development work is completed. See notes 1 and 3.

The Company has also entered into  conditional  sales  contracts for the sale of
approximately  2,200 lots in Rio Rancho, New Mexico which would close at varying
times through  fiscal 2009;  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.  No
recognition has been given to the  conditional  sales contracts in the financial
statements.

         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 for 2006, 2005 and 2004 was  approximately  $8,596,000,
$9,359,000 and $12,075,000.

The total minimum rental  commitments for years  subsequent to April 30, 2006 of
$25,055,000  are due as follows:  2007 - $5,396,000;  2008 - $3,586,000;  2009 -
$2,896,000; 2010 - $2,485,000; 2011 - $2,342,000; and thereafter - $8,350,000.

         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 the lot of the
purchaser,  without  cost  to  the  purchaser.  The  Company  has  not  incurred
significant costs related to the exchange of lots.

(15)     LITIGATION:
         -----------

A subsidiary  of Kable is a defendant  in a lawsuit in which 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.  The  plaintiff  sought  damages from the Kable
defendant of approximately $15.2 million;  any damages awarded would be trebled.
In  September  2005,  the Court  granted the motion for summary  judgment of the
defendants,  including Kable, and judgment in favor of the defendants, including
Kable,  was entered.  The plaintiff has appealed the judgment.  No provision has
been made in the financial statements for this contingency.

The Company and 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 Company and its subsidiaries.



                                       39
<PAGE>

(16)     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, media services trade receivables 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 change.
The  estimated  fair  value  of the  Company's  long-term,  fixed-rate  mortgage
receivables was $14.1 million and $4.1 million versus carrying  amounts of $14.2
million and $4.3  million at April 30, 2006 and April 30,  2005.  The  estimated
fair value of the Company's long-term, fixed-rate notes payable was $3.4 million
versus a carrying amount of $3.6 million as of April 30, 2006, and both the fair
value and carrying amount was $4.5 million as of April 30, 2005.

(17)     INFORMATION ABOUT THE COMPANY'S OPERATIONS IN DIFFERENT
         -------------------------------------------------------
         INDUSTRY SEGMENTS:
         ------------------

The Company has identified  three segments in which it currently  operates under
the  definition  established by SFAS No. 131. Real Estate  operations  primarily
include land sales  activities,  which  involve the  obtaining of approvals  and
development of large tracts of land for sales to homebuilders,  commercial users
and others, as well as investments in commercial and investment properties.  The
Company's  Media  Services  subsidiary has two  identified  segments,  Newsstand
Distribution Services and Fulfillment Services.  Fulfillment Services operations
involve  the  performance  of  subscription  and product  fulfillment  and other
related  activities  on behalf of  various  publishers  and  other  clients, and
Newsstand  Distribution Services operations involve the national and, to a small
degree,  international  distribution  and sale of  periodicals  to  wholesalers.
Corporate  revenues and expenses not  identifiable  with a specific  segment are
grouped  together  in this  presentation.  Certain  common  expenses  as well as
identifiable   assets  are  allocated   among   industry   segments  based  upon
management's estimate of each segment's absorption.






                                       40
<PAGE>


Summarized  data  relative  to the  industry  segments  in which the Company has
operations is as follows (amounts in thousands):
<TABLE>
<S>                                    <C>                <C>              <C>                <C>              <C>

                                                                            Newsstand
                                          Real Estate      Fulfillment     Distribution
                                          Operations       Services          Services         Corporate        Consolidated
                                        -------------     ------------     ------------      -----------      -------------
Year ended April 30, 2006:
   Revenues                             $   59,169        $   75,332       $   13,131         $     664        $   148,296
   Expenses                                 30,906            70,352           11,290             2,677            115,225
   Management fee (income)                     995               851              144            (1,990)                 -
   Interest expense (income), net                -               452             (108)                -                344
                                        -------------     ------------     ------------      -----------      -------------
   Pretax income (loss) contribution
     from continuing operations         $   27,268        $    3,677       $    1,805         $     (23)       $    32,727
                                        =============     ============     ============      ===========      =============

   Depreciation and amortization        $      235        $    4,552       $      749         $      32        $     5,568
   Identifiable assets                  $   80,456        $   43,061       $   28,738         $  31,595        $   183,850
   Intangible assets                    $        -        $    1,298       $    3,893         $       -        $     5,191
   Capital expenditures                 $      252        $    3,500       $      140         $       4        $     3,896

---------------------------------------------------------------------------------------------------------------------------
Year ended April 30, 2005:
   Revenues                             $   37,385        $   83,896       $   13,017         $     208        $   134,506
   Expenses                                 20,995            76,228           11,603             2,106            110,932
   Management fee (income)                     900               784              116            (1,800)                 -
   Interest expense, net                         5               555               47                53                660
                                        -------------     ------------     ------------      -----------      -------------
   Pretax income (loss) contribution
     from continuing operations         $   15,485        $    6,329       $    1,251         $    (151)       $    22,914
                                        =============     ============     ============      ===========      =============
   Depreciation and amortization        $      188        $    4,403       $      575         $     177        $     5,343
   Identifiable assets                  $   75,571        $   41,918       $   38,681         $  32,948        $   189,118
   Intangible assets                    $        -        $    1,298       $    3,893         $       -        $     5,191
   Capital expenditures                 $    1,913        $    3,018       $        -         $      14        $     4,945

---------------------------------------------------------------------------------------------------------------------------
Year ended April 30, 2004:
   Revenues                             $   29,415        $   87,629       $   12,162         $      85        $   129,291
   Expenses                                 17,022            80,786           11,036             1,568            110,412
   Management fee (income)                     770               592              141            (1,503)                 -
   Interest expense, net                       213               615               30                86                944
                                        -------------     ------------     ------------      -----------      -------------
   Pretax income (loss) contribution
     from continuing operations         $   11,410        $    5,636       $      955         $     (66)       $    17,935
                                        =============     ============     ============      ===========      =============
   Depreciation and amortization        $      225        $    4,087       $      459         $     244        $     5,015
   Identifiable assets                  $   76,934        $   38,983       $   33,917         $  16,140        $   165,974
   Intangible assets                    $        -        $    1,298       $    3,893         $       -        $     5,191
   Capital expenditures                 $      266        $    3,069       $      218         $     115        $     3,668

---------------------------------------------------------------------------------------------------------------------------
</TABLE>


                                       41
<PAGE>





(18)  SELECTED QUARTERLY FINANCIAL DATA  (Unaudited):
      -----------------------------------------------
<TABLE>
<S>                                      <C>             <C>              <C>              <C>

                                             (In thousands of dollars, except per share amounts)
                                                                  Quarter Ended
                                         -----------------------------------------------------------------

Year ended April 30, 2005:                  July 31,       October 31,      January 31,      April 30,
                                              2005            2005            2006             2006
                                         --------------  ---------------  --------------  --------------
Revenues                                  $    30,014     $     34,847     $    35,589     $    47,846

Gross Profit                                    6,437           10,698           9,671          19,688

Income from continuing
  operations, net of taxes                      1,802            5,062           5,241          10,389
                                         --------------  ---------------  --------------  --------------
Income (loss) from operations of
  discontinued business, net of
  taxes                                         3,562               (6)              -               -
                                         --------------  ---------------  --------------  --------------
Net income                                $     5,364     $      5,056     $      5,241    $    10,389
                                         ==============  ===============  ==============  ==============
Earnings per share - Basic
  and Diluted (a):
    Continuing operations                 $      0.27     $       0.76     $       0.79    $      1.56
    Discontinued operations                      0.54                -                -              -
                                         --------------  ---------------  --------------  --------------
  Total                                   $      0.81     $       0.76     $       0.79    $      1.56
                                         ==============  ===============  ==============  ==============

(a)  The sum of the quarters does not equal the full year earnings per share due
     to rounding.

Year ended April 30, 2005:                  July 31,       October 31,      January 31,      April 30,
                                              2004             2004            2005             2005
                                         --------------  ---------------  --------------  --------------
Revenues                                  $    33,638     $     33,230     $     31,486    $     36,152

Gross Profit                                    9,967            9,465            7,120          11,072

Income from continuing
  operations, net of taxes                      3,941            4,370            2,511           4,766
                                         --------------  ---------------  --------------  --------------
Income (loss) from operations of
  discontinued business, net of
  taxes                                            85             (175)              50             (23)
                                         --------------  ---------------  --------------  --------------
Net income                                $     4,026     $      4,195     $      2,561    $      4,743
                                         ==============  ===============  ==============  ==============
Earnings (loss) per share - Basic
  and Diluted:
    Continuing operations                 $      0.60     $       0.66     $       0.38    $       0.72
    Discontinued operations                      0.01            (0.03)            0.01               -
                                         --------------  ---------------  --------------  --------------
Total                                     $      0.61     $       0.63     $       0.39    $       0.72
                                         ==============  ===============  ==============  ==============

</TABLE>







                                       42
<PAGE>


Item 9.             Changes in and Disagreements with Accountants on Accounting
-------             -----------------------------------------------------------
                    and Financial Disclosure
                    ------------------------
None

Item 9A.            Controls and Procedures
--------            -----------------------

Evaluation of Disclosure Controls and Procedures

The  Company's  management,  with  the  participation  of  the  Company's  chief
financial  officer  and  the  other  executive  officers  whose   certifications
accompany this annual report,  has evaluated the  effectiveness of the Company's
disclosure  controls  and  procedures  (as defined in Rule  13a-15(e)  under the
Securities  Exchange  Act of 1934) as of the end of the  period  covered by this
report.  As a result of such  evaluation,  the chief financial  officer and such
other  executive  officers  have  concluded  that such  disclosure  controls and
procedures are effective to provide  reasonable  assurance that the  information
required to be disclosed in the reports the Company  files or submits  under the
Securities  Exchange  Act of 1934 is (i)  recorded,  processed,  summarized  and
reported  within the time  periods  specified  in the  Securities  and  Exchange
Commission's   rules  and  forms,  and  (ii)  accumulated  and  communicated  to
management,  including the Company's principal executive and principal financial
officers or persons performing such functions,  as appropriate,  to allow timely
decisions regarding  disclosure.  The Company believes that a control system, no
matter how well designed and operated,  cannot provide  absolute  assurance that
the  objectives of the control system are met, and no evaluation of controls can
provide  absolute  assurance that all control issues and instances of fraud,  if
any, within a company have been detected.

Changes in Internal Control over Financial Reporting

No change in the Company's system of internal  control over financial  reporting
occurred during the most recent fiscal quarter that has materially affected,  or
is  reasonably  likely to materially  affect,  internal  control over  financial
reporting.


Item 9B.            Other Information
--------            -----------------

None


























                                       43
<PAGE>


                                    PART III
                                    --------

Item 10.            Directors and Executive Officers of the Registrant
--------            --------------------------------------------------

The information set forth under the headings "Election of Directors", "The Board
of  Directors  and its  Committees"  and  "Section  16(a)  Beneficial  Ownership
Reporting  Compliance"  in the  Company's  Proxy  Statement  for its 2006 Annual
Meeting of Shareholders to be filed with the Securities and Exchange  Commission
(the "2006 Proxy Statement") is incorporated  herein by reference.  In addition,
information  concerning the Company's  executive  officers is included in Part I
above under the caption "Executive Officers of the Registrant".

Item 11.            Executive Compensation
--------            ----------------------

The information set forth under the headings  "Executive  Compensation" and "The
Board  of  Directors  and  its  Committees"  in  the  2006  Proxy  Statement  is
incorporated herein by reference.

Item 12.           Security Ownership of Certain Beneficial Owners and
--------           ---------------------------------------------------
                   Management and Related Stockholder Matters
                   ------------------------------------------

The  information  set forth under the heading "Common Stock Ownership of Certain
Beneficial Owners and Management" and under the subheading "Equity  Compensation
Plan  Information"  in the  2006  Proxy  Statement  is  incorporated  herein  by
reference.

Item 13.           Certain Relationships and Related Transactions
--------           ----------------------------------------------

The information set forth under the heading  "Compensation  Committee Interlocks
and Insider Participation" in the 2006 Proxy Statement is incorporated herein by
reference.

Item 14.           Principal Accountant Fees and Services
--------           --------------------------------------

The information set forth under the subheadings  "Audit Fees" and  "Pre-Approval
Policies and Procedures" in the 2006 Proxy  Statement is incorporated  herein by
reference.









                                       44
<PAGE>



                                     PART IV
                                     -------

Item 15.          Exhibits and Financial Statement Schedules
--------          ------------------------------------------

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

                  AMREP Corporation and Subsidiaries:

                    o    Report of Independent Registered Public Accounting Firm
                         dated June 13, 2006 - McGladrey & Pullen, LLP

                    o    Consolidated Balance Sheets - April 30, 2006 and 2005

                    o    Consolidated  Statements  of Income for the Three Years
                         Ended April 30, 2006

                    o    Consolidated Statements of Shareholders' Equity for the
                         Three Years Ended April 30, 2006

                    o    Consolidated  Statements  of Cash  Flows  for the Three
                         Years Ended April 30, 2006

                    o    Notes to Consolidated Financial Statements

                  2.  Financial Statement Schedules.  The following financial
                      -----------------------------
statement schedule is 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)                   Exhibits.  See (a)3 above.
                      --------

(c)                  Financial Statement Schedules.  See (a)2 above.
                     -----------------------------



                                       45
<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 27, 2006                               By /s/ Peter M. Pizza
                                                       ------------------------
                                                       Peter M. Pizza
                                                       Vice President and Chief
                                                       Financial Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this report
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 and Chief Financial      Director
  Officer Principal Financial             Dated:  July 27, 2006
  Officer and Principal
  Accounting Officer*
  Dated:  July 27, 2006

/s/ Edward B. Cloues  II                 /s/ Albert V.  Russo
------------------------                 --------------------------
  Edward B. Cloues II                     Albert V. Russo
  Director                                Director
  Dated:  July 27, 2006                   Dated:  July 27, 2006

/s/ Lonnie A. Coombs                     /s/ Samuel N. Seidman
------------------------                 --------------------------
  Lonnie A. Coombs                        Samuel N. Seidman
  Director                                Director
  Dated:  July 27, 2006                   Dated:  July 27, 2006

/s/ Elmer F. Hansen, Jr                  /s/ James Wall
------------------------                 --------------------------
  Elmer F. Hansen, Jr.                    James Wall
  Director                                Director*
  Dated:  July 27, 2006                   Dated:  July 27, 2006

                                         /s/ Michael P. Duloc
                                         --------------------------
                                          Michael P. Duloc
                                          President, Kable Media Services, Inc.*
                                          Dated:  July 27, 2006


-----------------
*The  Registrant  is a  holding  company  which  does  substantially  all of its
business through two wholly-owned  subsidiaries (and their subsidiaries).  Those
wholly-owned  subsidiaries  are AMREP  Southwest  Inc.  ("ASW")  and Kable Media
Services, Inc. ("Kable").  James Wall is the principal executive officer of ASW,
and Michael P. Duloc is the principal executive officer of Kable. The Registrant
has no chief  executive  officer.  Its  executive  officers  include James Wall,
Senior Vice  President and Peter M. Pizza,  Vice  President and Chief  Financial
Officer,  and Michael P. Duloc, who may be deemed an executive officer by reason
of his position with Kable.






                                       46
<PAGE>
<TABLE>
<CAPTION>


                       AMREP CORPORATION AND SUBSIDIARIES
                       ----------------------------------
                 SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS
                 -----------------------------------------------
                                   (Thousands)
<S>                                         <C>              <C>              <C>               <C>              <C>
                                                                       Additions
                                                                Charges         Charged
                                              Balance at      (Credits) to    (Credited) to
                                               Beginning        Costs and          Other                         Balance at End
            Description                        of Period        Expenses         Accounts         Deductions       of Period
            -----------                     ---------------  --------------- ----------------   --------------   --------------



FOR THE YEAR ENDED
 APRIL 30, 2006:
     Allowance for doubtful accounts
       (included in receivables - real
       estate operations on the
       consolidated balance sheet)            $        96      $        -      $          -       $         -      $       96
                                            ---------------  --------------- ----------------   --------------   --------------


     Allowance for estimated returns and
       doubtful accounts (included in
       receivables - magazine circulation
       operations on the consolidated
       balance sheet)
                                              $    59,165      $   (3,483)     $          -       $       76       $   55,606
                                            ---------------  --------------- ----------------   --------------   --------------
 FOR THE YEAR ENDED
 APRIL 30, 2005:
     Allowance for doubtful accounts
       (included in receivables - real
       estate operations on the
       consolidated balance sheet)            $       192      $        -      $          -       $       96       $       96
                                            ---------------  --------------- ----------------   --------------   --------------

     Allowance for estimated returns and
       doubtful accounts (included in
       receivables - magazine circulation
       operations on the consolidated
       balance sheet)                         $    55,620      $    3,825      $          -       $      280       $   59,165
                                            ---------------  --------------- ----------------   --------------   --------------

 FOR THE YEAR ENDED
 APRIL 30, 2004:
     Allowance for doubtful accounts
       (included in receivables - real
       estate operations on the
       consolidated balance sheet)            $       280      $        7      $          -       $       95       $      192
                                             ---------------  --------------- ----------------   --------------   --------------

     Allowance for estimated returns and
       doubtful accounts (included in
       receivables - magazine circulation
       operations on the consolidated
       balance sheet)
                                              $    65,811      $  (10,015)     $          -       $      176       $   55,620
                                            ---------------  --------------- ----------------   --------------   --------------
</TABLE>

     Note: Charges (credits) recorded in magazine circulation operations include
     a reserve for the estimate of magazine returns from wholesalers,  which are
     substantially  offset by offsetting  credits related to the return of these
     magazines to publishers.










                                       47
<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  July 13, 2004 -  Incorporated  by  reference  to
          Exhibit  3 (b) to  Registrant's  Annual  Report  on Form  10-K for the
          fiscal year ended April 30, 2004.

4 (a)     Amended and Restated Loan and Security Agreement dated as of April 28,
          2005 among Kable News  Company,  Inc.,  Kable  Distribution  Services,
          Inc., Kable News Export,  Ltd., Kable News International,  Inc., Kable
          Fulfillment  Services,  Inc. and Kable  Fulfillment  Services of Ohio,
          Inc.  and  LaSalle  Bank  National  Association.   -  Incorporated  by
          reference to Exhibit 10.1 to  Registrant's  Current Report on Form 8-K
          filed May 3, 2005.

4 (b)     First  Amendment  dated as of April 27, 2006 to Amended  and  Restated
          Loan and  Security  Agreement  dated as of April 28,  2005 among Kable
          News Company,  Inc.,  Kable  Distribution  Services,  Inc., Kable News
          Export,  Ltd..  Kable  News  International,  Inc.,  Kable  Fulfillment
          Services,  Inc.,  and Kable  Fulfillment  Services of Ohio,  Inc.  and
          LaSalle Bank  National  Association.  -  Incorporated  by reference to
          Exhibit 10.1 to Registrant's  Current Report on Form 8-K filed May 24,
          2006.

4 (c)     Credit  Agreement  dated as of April 1, 2005 between  AMREP  Southwest
          Inc. and Wells Fargo Bank,  National  Association  -  Incorporated  by
          reference to Exhibit 10.1 to  Registrant's  Current Report on Form 8-K
          filed May 11, 2005.

4 (d)     Revolving Line of Credit Note dated April 1, 2005 from AMREP Southwest
          Inc. to Wells Fargo  Bank,  National  Association  -  Incorporated  by
          reference to Exhibit 10.2 to  Registrant's  Current Report on Form 8-K
          filed May 11, 2005.

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.*

10 (b)    2002 Non-Employee Directors' Stock Plan - Incorporated by reference to
          Exhibit  10.1 to  Registrant's  Quarterly  Report on Form 10-Q for the
          quarterly period ended January 31, 2003.*

10 (c)    Offer letter dated June 2, 2005 from  Registrant  to Joseph S. Moran -
          Incorporated  by  reference to Exhibit  10.1 to  Registrant's  Current
          Report on Form 8-K filed June 8, 2005.*

10 (d)    Amended and Restated Distribution Agreement dated as of April 30, 2006
          between Kappa Publishing Group, Inc. and Kable Distribution  Services,
          Inc.- Filed herewith. **

21        Subsidiaries  of Registrant - Incorporated  by reference to Exhibit 21
          to  Registrant's  Annual Report on Form 10-K for the fiscal year ended
          April 30, 2005 filed July 28, 2005.

23        Consent of McGladrey & Pullen, LLP - Filed herewith.

31.1      Certification  required  by Rule  13a - 14 (a)  under  the  Securities
          Exchange Act of 1934.

31.2      Certification  required  by Rule  13a - 14 (a)  under  the  Securities
          Exchange Act of 1934.

31.3      Certification  required  by Rule  13a - 14 (a)  under  the  Securities
          Exchange Act of 1934.

32        Certification  required  by Rule  13a - 14 (b)  under  the  Securities
          Exchange Act of 1934.

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

**  Portions  of this  exhibit  have been  omitted  pursuant  to a  request  for
confidential  treatment  under Rule 24b-2 under the  Securities  Exchange Act of
1934.


                                       48