SECURITIES
AND EXCHANGE COMMISSION
 Washington,
D.C. 20549
 
 AMENDED
FORM 10-K
 
 x Annual Report Pursuant to Section 13 or
15(d) of the Securities Exchange Act of 1934
 
 For the
fiscal year ended April 30, 2004
 
 or
 o 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 0-11306
 
 VALUE
      LINE, INC.(Exact
      name of registrant as specified in its
charter)
 
 New
      York
    
    13-3139843(State
      or other jurisdiction of
    
    (IRS
      Employer Identification Number)incorporation
      or organization)
 
 220 East 42nd Street, New York, NY
    
    10017-5891(Address
      of principal executive offices)
    
    (Zip
Code)
 
 Registrant's
telephone number, including area code: (212) 907-1500
 
 Securities
registered pursuant to Section 12(b) of the Act:
 
 None
 
 Securities
registered pursuant to Section 12(g) of the Act:
 
 Common
Stock, $.10 par value
 
 Indicate
by check mark whether the registrant (1) has filed all reports required to be
filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months and (2) has been subject to such filing requirements for the
past 90 days.
 
 Yes x  No o
  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 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. o
 
 
 
  Indicate
by check mark whether the registrant is an accelerated filer (as defined in Rule
12b-2 of the Act). Yes oNo x
 
 The
aggregate market value of the registrant's voting and non-voting common stock
held by non-affiliates at June 16, 2004, was $52,340,000. There were 9,981,600
shares of the registrant’s Common Stock outstanding at June 16,
2004.
 
 DOCUMENTS
INCORPORATED BY REFERENCE
 
 None
 Part
I
 
 Item
      1.
    BUSINESS.
 
 Value
Line, Inc. (the "Company"), a New York corporation, was organized in 1982 and is
the successor to substantially all of the operations of Arnold Bernhard &
Company, Inc. ("AB&Co."). As of June 16, 2004, AB & Co. owned
approximately 86% of the Company’s issued and outstanding common
stock.
 
 The
Company's primary businesses are producing investment related periodical
publications through its wholly-owned subsidiary, Value Line Publishing, Inc.
("VLP"), and providing investment advisory services to mutual funds,
institutions and individual clients. VLP publishes in both print and electronic
formats The Value Line Investment Survey Ô , one of
the nation's major periodical investment services, as well as The Value Line
Investment Survey - Small and Mid-Cap Edition, The Value Line 600, Value Line
Select, The Value Line Mutual Fund Survey, The Value Line No-Load Fund Advisor,
Value Line Insight, The Value Line Special Situations Service, The Value Line
Options Survey and The Value Line Convertibles Survey. VLP also provides current
and historical financial databases (DataFile, Estimates & Projections,
Convertibles, Mutual Funds and other services) in standard computer formats and
markets investment analysis software, Value Line Investment Survey *for
Windows* ®, Mutual
Fund Survey *for
Windows* **®,** Value
Line Daily Options Survey and Value Line Electronic Convertibles. These
electronic products are available on CD-Rom and offered directly on the
Company’s internet site, www.valueline.com . The
Company's print and electronic services are marketed through media, direct mail
and the internet to retail and institutional investors.
 
 The
Company is the investment adviser for the Value Line Family of Mutual Funds,
which on April 30, 2004, included 14 open-end investment companies with various
investment objectives. In addition, the Company manages investments for private
and institutional clients. The Company is registered with the Securities and
Exchange Commission as an investment adviser under the Investment Advisers Act
of 1940.
 
 In
addition to VLP, the Company's other wholly-owned subsidiaries include a
registered broker-dealer, Value Line Securities, Inc., and an advertising
agency, Vanderbilt Advertising Agency, Inc. These subsidiaries primarily provide
services used by the Company in its investment management and publishing
businesses. Compupower Corporation, another subsidiary, serves the subscription
fulfillment needs of the Company's publishing operations. Value Line
Distribution Center, Inc. (“VLDC”) handles all of the mailings of the
publications to the Company’s subscribers. Additionally, VLDC provides office
space for Compupower
 
 2
 
 Corporation’s computer operations center. The name
"Value Line," as used to describe the Company, its products, and its
subsidiaries, is a registered trademark of the Company. As used herein, except
as the context otherwise requires, the term "Company" includes the Company and
its consolidated subsidiaries.
 
 A.
    Investment
      Information and Publications.
 
 VLP
publishes investment related publications and produces electronic products
described below:
 
 l.
    Publications:
 
 The Value
Line Investment Survey is a weekly investment related periodical that in
addition to various timely articles on current economic, financial and
investment matters ranks common stocks for future relative performance based on
computer-generated statistics of financial results and stock market performance.
A combined Index on our Web site allows the subscriber to easily locate a
specific stock among the approximately 3,500 stocks covered in the Small and
Mid-Cap Edition and in the standard edition of The Value Line Investment Survey.
Two of the more important evaluations for each stock covered are
"Timeliness( *tm* )" and
"Safety( *tm* ).”
Timeliness( *tm* ) relates
to the probable relative price performance of one stock over the next six to
twelve months, as compared to the rest of the approximately 1,700 covered
stocks. Rankings are updated each week and range from Rank 1 for the expected
best performing stocks to Rank 5 for the expected poorest performers. "Safety"
Ranks are a measure of risk and are based primarily on the issuer's relative
financial strength and its stock's price stability. "Safety" ranges from Rank 1
for the least risky stocks to Rank 5 for the riskiest. VLP employs approximately
104 analysts and statisticians who prepare articles of interest for each
periodical and who evaluate stock performance and provide future earnings
estimates and quarterly written evaluations with more frequent updates when
relevant.
 
 The Small
and Mid-Cap Edition of The Value Line Investment Survey is a weekly publication
introduced in 1995 that provides detailed descriptions of approximately 1,800
small- and medium-capitalization stocks, many listed on NASDAQ, beyond the 1,700
stocks of larger-capitalization companies traditionally covered in The Value
Line Investment Survey - Standard Edition. Like The Value Line Investment
Survey, the Small and Mid-Cap Edition has its own "Summary & Index"
providing updated performance ranks and other data, as well as "screens" of key
financial performance measures. The "Ratings and Reports" section, providing
updated reports on about 140 stocks each week, has been organized to correspond
closely to the industries reviewed in the Standard Edition of The Value Line
Investment Survey. A combined Index, published semiannually, allows the
subscriber to easily locate a specific stock among the approximately 3,500
stocks covered.
 
 The Small
and Mid-Cap Edition includes a number of unique as well as standard features.
One unique feature, The Performance Ranking System, incorporates many of the
elements of the Value Line Timeliness( *tm)* Ranking
System, modified to accommodate the 1,800 stocks in the Small and Mid-Cap
Edition. The Performance( *tm)* Rank is
based on earnings growth and price momentum and is designed to predict relative
price performance over the next six to 12 months.
  3
  The
principal difference between the Small and Mid-Cap Edition and The Value Line
Investment Survey’s Standard Edition is that the Small and Mid-Cap Edition does
not include Value Line’s financial forecasts or analysts' comments. Nor does the
Small & Mid-Cap Edition include a Selection & Opinion section. These
modifications allow VLP to offer this service at a relatively low
price.
 
 The Value
Line Mutual Fund Survey is published once every three weeks and was introduced
in 1993. It provides full-page profiles of 700 mutual funds and condensed
coverage of more than 1,250 funds. Every three weeks subscribers receive an
updated issue, containing over 200 fund reports, plus a "Performance &
Index" providing current rankings and performance figures for the full universe
of more than 2,000 funds, as well as articles on investment trends and issues
concerning mutual fund investors. The Value Line Mutual Fund Survey also
includes annual profiles and analyses on 100 of the nation's major fund
families. Funds are ranked for both risk and overall risk-adjusted performance
using strictly quantitative means. A large binder is provided to house the fund
reports.
 
 The Value
Line No-Load Fund Advisor is a 36-page monthly newsletter for investors who wish
to manage their own portfolios of no- and low-load, open-end mutual funds. Each
issue features strategies for maximizing total return, with special attention
given to tax considerations. Also featured are in-depth interviews with noted
portfolio managers, model portfolios for a range of investor profiles, and
information about retirement planning, industry news, and listings (with
descriptions) of new funds worthy of further consideration. A full statistical
review, including latest performance, rankings and sector weightings, is updated
each month on 600 leading no-load and low-load funds.
 
 The Value
Line Special Situations Service, published periodically 24 times a year,
concentrates on fast-growing, smaller companies whose stocks are perceived by
VLP analysts as having exceptional appreciation potential.
 
 The Value
Line Options Survey, a semi-monthly periodical service published 24 times a
year, evaluates and ranks the expected performance of the most active options
listed on United States exchanges (approximately 80,000). An electronic version
of this publication, The Value Line Daily Options Survey (available over the
Internet), was introduced during the latter part of fiscal 1995. A new enhanced
version was introduced in May of 2002. New features include an interactive
database and a new spreadsheet.
 
 The Value
Line Convertibles Survey, a semi-monthly periodical service published 24 times a
year, evaluates and ranks approximately 600 convertible securities (bonds and
preferred stocks) and approximately 80 warrants for future market performance.
The same information is also available online.
 
 Value
Line Select, a monthly publication, was first published in January 1998. As a
stock recommendation service with an exclusive circulation, it focuses each
month on one company that VLP analysts, economists and statisticians recommend
as an investment. Recommendations are backed by in-depth research and are
subject to ongoing monitoring.
 
 The Value
Line 600 is a monthly service, which contains full-page reports on more than 600
stocks. Its reports provide information on many actively traded, larger
capitalization issues as well as some smaller growth stocks. Since it was
introduced in fiscal 1996, it has proven to be
 4
 
 very popular among investors who want the same type of
analysis provided in the full Investment Survey, but who don’t want or need
coverage of the large number of companies contained in that publication. Readers
also receive supplemental reports as well as a monthly Index, which includes
updated statistics.
 
 2.
    Electronic
      Products:
 
 Value
Line Investment Analyzer 3.9 on CD-ROM is a powerful menu-driven software
program with fast filtering, ranking, reporting and graphing capabilities
utilizing over 300 data fields for about 8,000 stocks, industries and indices,
including the 1,700 stocks covered in VLP’s benchmark publication, The Value
Line Investment Survey. The product was introduced in June 1996. The latest
version has major enhancements to the user interface and the ability for users
to update data from the Company’s Internet site (www.valueline.com). New
features are added continuously.
 
 Value
Line Investment Analyzer 3.9 provides over 300 search fields and more than 100
charting and graphing variables for comparative research. In addition to
containing digital replicas of the entire Value Line Investment Survey, the
Windows version includes daily data updates through its seamless integration
with the Value Line Web site (www.valueline.com). The software includes a
portfolio module that lets users create and track their own stock portfolios and
ten years of historical financial data for scrutinizing performance, risk and
yield.
 
 Value
Line Mutual Fund Survey *for
Windows* **®,** a monthly
CD-ROM product with weekly internet updates, is the electronic version of the
Value Line Mutual Fund Survey. The program features powerful sorting, filtering
and portfolio analysis. Version 2 was introduced in 1998, with added features
such as style attribution analysis, portfolio stress tester, portfolio
rebalancing, correlation of fund returns and hypothetical assets to
differentiate it from the competition.
 
 Windows
is a registered trademark of Microsoft Corp. Value Line, Inc. and Microsoft
Corp. are not affiliated companies.
 
 Value
Line DataFile contains current and historic annual and quarterly financial
records for about 8,000 active companies and over 5,000 companies that no longer
exist in numerous industries, including air transport, industrial services,
beverage, machinery, bank, insurance and finance, savings and loan associations,
toys, and securities brokers. DataFile has over 400 annual and over 80 quarterly
fields for each of the companies included in the database. DataFile is sold to
the institutional market. Value Line DataFile II, which includes less historical
data is also available. This version complies with Microsoft Access format for
small businesses. During fiscal 1997, Value Line introduced the Value Line
Mutual Fund DataFile. It covers over 15,000 mutual funds with up to 20 years of
historical data which consists of almost 200 data fields. VLP also offers an
Estimates and Projections File, with year-ahead and three- to five-year
estimates of financial performance and projections of stock-price ranges on
companies covered in the Value Line Investment Survey, as well as a Convertible
Securities File and custom services.
 
 The Total
Return Service is a customized data service. It was developed to help publicly
traded companies meet the SEC's mandated executive-compensation disclosure
requirements. The service consists of a line graph comparing the total return of
a public company's stock over the last five years to a published equity market
index and a published or constructed industry index.
 
 5
 
 3.
    Value
      Line Internet:
 
 Most
Value Line products and services are available from the Company’s Web site www.valueline.com . The
site includes a multimedia section that features daily market reports and
updates on stocks, options, mutual funds and convertibles as well as webcasting
of daily analyst commentary and fast-breaking developments on companies in the
news. In addition, the Company has added a host of new tools to chart and filter
stocks and mutual funds along with tools to build a portfolio, customize a
report and receive Value Line reports.
 
 A new
internet-only service, the Value Line Research Center, includes on-line access
to the Company’s leading publications covering stocks, mutual funds, options and
convertible securities as well as special situation stocks. This service
includes full subscriptions to The Value Line Investment Survey, The Value Line
Mutual Fund Survey, The Value Line Daily Options Survey, The Value Line
Investment Survey Small and Mid-Cap Edition, The Value Line Convertibles Survey,
The Special Situations Service, Value Line ETF Survey, The Value Line No Load
Fund Advisor, Value Line 600 and Value Line Select.
 
 B.
    Investment
      Management.
 
 As of
April 30, 2004, the Company was the investment adviser for 14 mutual funds
registered under the Investment Company Act of 1940. Value Line Securities,
Inc., a wholly owned subsidiary of the Company, acts as principal underwriter
and distributor for the Value Line Funds. State Street Bank and Trust Company,
an unaffiliated entity, acts as custodian of the Funds' assets. Shareholder
services for the Value Line Funds are provided by Boston Financial Data
Services, an unaffiliated entity associated with State Street Bank and Trust
Company.
 
 Total
      net assets of the Value Line Funds at April 30, 2004, were:(in
      thousands)The
      Value Line Fund, Inc.
    
    $
    198,674Value
      Line Income and Growth Fund, Inc.
    
    
    209,817The
      Value Line Special Situations Fund, Inc.
    
    
    320,743Value
      Line Leveraged Growth Investors, Inc.
    
    
    317,851The
      Value Line Cash Fund, Inc.
    
    
    301,373Value
      Line U.S. Government Securities Fund, Inc.
    
    
    126,019Value
      Line Centurion Fund, Inc.
    
    
    339,953The
      Value Line Tax Exempt Fund, Inc.
    
    
    141,787Value
      Line Convertible Fund, Inc.
    
    
    43,495Value
      Line Aggressive Income Trust
    
    
    61,966Value
      Line New York Tax Exempt Trust
    
    
    26,257Value
      Line Strategic Asset Management Trust
    
    
    778,119Value
      Line Emerging Opportunities Fund, Inc.
    
    
    260,647Value
      Line Asset Allocation Fund, Inc.
    
    
    144,682$
    3,271,383
 
 6
 
 The
investment advisory contracts between each of the Value Line Funds and the
Company provide that the Company will render investment advisory and other
services to the Funds. These contracts must be approved annually in accordance
with statutory procedures. The Company furnishes each fund with its investment
program, subject to such fund's fundamental investment policies and to control
and review by such fund's Board of Directors or Trustees. Each contract also
provides that the Company will furnish, at its expense, various administrative
services, office space, equipment and administrative personnel necessary for
managing the affairs of the funds. Advisory fee rates vary among the funds and
may be subject to certain limitations. Each mutual fund may use "Value Line" in
its name only so long as the Company acts as its investment
adviser.
 
 Value
Line Asset Management ("VLAM"), a division of the Company, manages pension funds
and institutional and individual portfolios by utilizing the techniques
developed for The Value Line Investment Survey. VLAM has varied investment
advisory agreements with its clients which call for payments to the Company
calculated on the basis of the market value of the assets under
management.
 
 C.
    Wholly-Owned
      Operating Subsidiaries.
 
 1.
    Vanderbilt
      Advertising Agency, Inc.:
 
 Vanderbilt
Advertising Agency, Inc. ("Vanderbilt") places advertising for the Company's
publications, investment advisory services, and mutual funds. Commission income
generated by Vanderbilt serves to reduce the Company's advertising
expenses.
 
 2.
    Compupower
      Corporation:
 
 Compupower
provides computerized subscription fulfillment services for the Company as well
as subscriber relation’s services for Company publications. Additionally,
Compupower also provides microfiche and imaging services to the Company, its
affiliates and third-party customers.
 
 3.
    Value
      Line Securities, Inc.:
 
 Value
Line Securities, Inc. ("VLS") is registered as a broker-dealer under the
Securities Exchange Act of 1934 and is a member of the National Association of
Securities Dealers, Inc. VLS acts as the underwriter and distributor of the
Value Line Funds. Shares of the Value Line Funds are sold to the public without
a sales charge (i.e., on a "no-load" basis). VLS effects brokerage transactions
in exchange-listed securities for certain of the Value Line Funds, clearing such
transactions on a fully disclosed basis through unaffiliated broker-dealers who
receive a portion of the gross commissions. The Company receives service and
distribution fees, pursuant to SEC rule 12b-1, from certain Value Line Funds
which are used to offset marketing and distribution costs for these
funds.
 
 4.
    Value
      Line Distribution Center, Inc.:
 
 Value
Line Distribution Center, Inc. (“VLDC”) handles all of the mailings of the
publications to the Company’s subscribers. Additionally, VLDC provides office
space for the Compupower Corporation’s subscriber relations and data processing
departments.
 
 7
 
 D.
    Other
      Businesses.
 
 The
Company publishes the Value Line Arithmetic Composite and the Value Line
Geometric Composite, daily indices of the stock market performance of the
approximately 1,700 common stocks contained in The Value Line Investment Survey.
The calculation of both indices is done by a firm unaffiliated with the Company.
Futures contracts based upon fluctuations in the Value Line Arithmetic Composite
are traded on the Kansas City Board of Trade, and options on the Index are
traded on the Philadelphia Stock Exchange. The Company receives fees in
connection with these activities.
 
 **The
Value Line Strategy Trust Series I** : The
Company has licensed for a fee certain trademarks and proprietary information
for a series of unit investment trusts, ***The
Value Line Strategy Trust Series I*** . The
fundamental strategy for this Trust and future Trusts in this series is to
invest in the 100 Rank #1 stocks and maintain a static portfolio position in
these 100 stocks for a fourteen-month period. At the end of the fourteen months
the portfolio will be liquidated and the investors will be invited to reinvest
their distribution in the next available ***Value
Line Strategy Trust Series*** . These
unit investment trusts are sold by an extensive network of brokerage firms and
provide publicity for the ranking system within the brokerage industry. As of
April 30, 2004, total assets of approximately $25,000,000 had been invested in
these Trusts.
 ****
 **Value
Line Target 25 Portfolio** : The
fundamental strategy for this Trust and future Trusts in this series is to
invest in a selected 25 stocks of the 100 Rank #1 stocks and maintain a static
portfolio position in these 25 stocks for a thirteen-month period. At the end of
the thirteen months the portfolio is liquidated and the investors are invited to
reinvest their distribution in the next available ***Value
Line Target 25 Portfolio*** . First
Trust Portfolios, the underwriter of this UIT, has indicated that it intends to
introduce a new UIT series every month. These unit investment trusts are sold by
an extensive network of brokerage firms and provide a unique exposure for the
ranking system within the brokerage industry. As of April 30, 2004, aggregate
assets of over $321,000,000 had been invested in these Trusts.
 
 **The
Target VIP Portfolios** : These
are UIT products sponsored by First Trust Portfolios which use as a component of
their portfolio strategy the Value Line Target 25 strategy. As of April 30,
2004, $142,000,000 was invested in these trusts.
 
 **Closed-end
Fund Product Offerings**
 
 **Three
Established Products**
 
 **I.
First Trust Value Line 100 Closed-end Trust - Portfolio Based On Value Line
Timeliness 100 Rank #1 Strategy**
 
 This
closed-end fund, sponsored by First Trust Portfolios-(formerly known as Nike
Securities) -, was completed on June 12, 2003. The Fund's objective is to
provide capital appreciation. It seeks to outperform the S&P 500 Index by
adhering to a disciplined strategy of investing in a diversified portfolio of
the 100 common stocks Ranked #1 in Value Line's Timeliness Ranking System. The
Fund is listed on the American Stock Exchange, a dominant trading arena for
closed-end funds, and is trading with the symbol FVL.
 
 ***Total
assets currently attributable to this closed-end fund product are approximately
$305 million as of April 30, 2004.***
 
 8
 ****
 **II.
First Trust Value Line Dividend Closed-end Trust - Portfolio Based On Large-cap
Stocks Selected as Rank #1 and #2 by Value Line’s Safety Rank Strategy**
 
 This
closed-end fund, sponsored by First Trust Portfolios was completed on August 26,
2003 and raised total assets of $465 million. The Fund's investment objective is
to provide total return through a combination of current income and capital
appreciation. The Fund seeks to accomplish its investment objective by investing
in common stocks with minimum market cap of $1 billion that pay above average
dividends and have the potential for capital appreciation. The Fund is listed on
the American Stock Exchange, a dominant trading arena for closed-end funds, and
is trading with the symbol FVD.
 
 ***Total
assets currently attributable to this closed-end fund product are approximately
$422 million as of April 30, 2004.***
 
 **III.
First Trust Value Line & Ibbotson Equity Allocation
Fund**
 
 This
closed-end fund, sponsored by First Trust Portfolios, was completed during the
month of April 2004, as a closed-end management investment company. The
Allocation Fund will own a subset of the #1 and #2 ranked stocks per the Value
Line Timeliness Ô ,
Safety Ô , and
Technical Ô Ranking
Systems. The Trust closed April 27, 2004 and raised $120 million. The Fund is
listed on the American Stock Exchange, and is trading with the symbol
FVD.
 
 ***Total
assets currently attributable to this closed-end fund product are approximately
$124 million as of April 30, 2004.***
 
 ***Total
assets currently attributable to all three closed-end fund products are
approximately $851 million.***
 
 E.
    Investments.
 
 From time
to time, the Company invests in the Value Line Funds, long term fixed income
government obligations and in other marketable securities.
  F.
    Employees.
 
 At April
30, 2004, the Company and its subsidiaries employed 249 people.
 
 The
Company, its affiliates, officers, directors and employees may from time to time
own securities which are also held in the portfolios of the Value Line Funds or
recommended in the Company's publications. Analysts covering stocks may not own
stocks they cover. The Company has imposed rules upon itself requiring monthly
reports of securities transactions by employees for their respective accounts
and restricting trading in various types of securities in order to avoid
possible conflicts of interest.
 
 G.
    Assets.
 
 The
Company's assets identifiable to each of its principal business segments were as
follows:
  9
 April
      30,2004
    
    2003(in
      thousands)Investment
      Periodicals& Related Publications
    
    $
    14,592
    
    $
    18,648Investment
      Management
    
    
    74,786
    
    
    227,786Corporate
      Assets(1)
    
    
    177,546
    
    
    380$
    266,924
    
    $
    246,814

____________
(1)
    Corporate
      Assets have increased by $177,173,000 at April 30, 2004 in preparation forpayment
      in May 2004 of the Company’s ordinary dividend of $.25 per share and a
      specialdividend
      declared by the Board of Directors during April 2004 of $17.50 per
      share.
 H.
    Competition.
 
 The
investment management and the investment information and publications industries
are very competitive. There are many competing firms and a wide variety of
product offerings. Some of the firms in these industries are substantially
larger and have greater financial resources than the Company. The Company
believes that it is one of the world's largest independent securities research
organizations and that it publishes one of the world's largest investment
periodicals service in terms of number of subscriptions, annual revenues and
number of equity research analysts.
 
 I.
    Executive
      Officers.
 
 The
following table lists the names, ages (at June 16, 2004), and principal
occupations and employment during the past five years of the Company's Executive
Officers. All officers are elected to terms of office for one year. Each of the
following has held an executive position with the companies indicated for at
least five years.
 
 Name
    
    Age
    
    Principal
      Occupation or EmploymentJean
      Bernhard Buttner
    
    69
    
    Chairman
      of the Board, President and Chief ExecutiveOfficer
      of the Company and AB&Co. Chairman of theBoard
      and President of each of the Value Line Funds.Samuel
      Eisenstadt
    
    81
    
    Senior
      Vice President and Research Chairman.David
      T. Henigson
    
    46
    
    Vice
      President and Treasurer;Director
      of Compliance and Internal Audit;Vice
      President, Secretary, Treasurer and Chief ComplianceOfficer
      of each of the Value Line Funds; Vice President of
    AB&Co.Howard
      A. Brecher
    
    50
    
    Vice
      President and Secretary;Vice
      President, Secretary, Treasurer and General Counsel of
      AB&Co.Stephen
      R. Anastasio
    
    45
    
    Chief
      Financial Officer; Corporate Controller.
 
 
 10
 WEB SITE
ACCESS TO SEC REPORTS


The
Company’s Web site address iswww.valueline.com. The
Company’s annual report on Form 10-K, quarterly reports on Form 10-Q, current
reports on Form 8-K and any amendments to these reports are available free of
charge on the Financial Info page of the Company’s Web site as soon as
reasonably practicable after the reports are filed electronically with the
Securities and Exchange Commission.
 Item
      2.
    PROPERTIES.
 
 On June
4, 1993, the Company entered into a lease agreement for approximately 77,000
square feet that provided for the relocation of its office space to 220 East
42nd Street, New York, New York. On September 14, 2000, the Company amended its
New York lease for office space and returned to the landlord 6,049 sq. ft. of
excess capacity. The Company now leases approximately 71,000 square feet of
office space at 220 East 42 nd Street in
New York. During January 1996, a subsidiary of the Company purchased for cash an
approximately 85,000 square feet warehouse facility for $4,100,000. That
facility consolidated into a single location the distribution operations for the
various Company publications and the fulfillment operations of Compupower
Corporation. The remaining building capacity provides warehouse space, a
disaster recovery site and is available for future business expansion. The
Company believes the capacity of these facilities is sufficient to meet the
Company's current and expected future requirements.
 
 Item
      3.
    LEGAL
      PROCEEDINGS.
 
 There are
no material pending legal proceedings.
 
 Item
      4.
    SUBMISSION
      OF MATTERS TO A VOTE OF SECURITY HOLDERS.
 
 No
matters were submitted to a vote of the stockholders during the fourth quarter
of the fiscal year ended April 30, 2004.
 
 Part II
  Item
      5.
    MARKET
      FOR REGISTRANT'S COMMON EQUITY, RELATEDSTOCKHOLDER
      MATTERS AND ISSUER PURCHASES OF EQUITYSECURITIES.
 
 The
Registrant's Common Stock is traded on the over-the-counter market. The
approximate number of record holders of the Registrant's Common Stock at April
30, 2004 was 63. Over-the-counter price quotations reflect inter-dealer prices,
without retail mark-up, mark-down or commission and may not necessarily
represent actual transactions. The range of the bid and asked quotations and the
dividends paid on these shares during the past two fiscal years were as
follows:
 
 DividendHigh
    
    Low
    
    DeclaredQuarter
      Ended
    
    Bid
    
    Asked
    
    Bid
    
    Asked
    
    Per
      ShareJuly
      31, 2002
    
    $
    48.7600
    
    $
    49.2500
    
    $
    37.8600
    
    $
    38.8990
    
    $
    .25October
      31, 2002
    
    
    44.6900
    
    
    46.9800
    
    
    37.5000
    
    
    38.7000
    
    
    .25January
      31, 2003
    
    
    45.9600
    
    
    46.9600
    
    
    37.4400
    
    
    38.0000
    
    
    .25April
      30, 2003
    
    $
    48.3500
    
    $
    49.0100
    
    $
    44.7000
    
    $
    44.9600
    
    $
    .25
 
 11
 July
      31, 2003
    
    $
    54.7900
    
    $
    55.7700
    
    $
    45.6600
    
    $
    46.0000
    
    $
    .25October
      31, 2003
    
    
    50.1600
    
    
    51.5000
    
    
    47.6900
    
    
    48.1000
    
    
    .25January
      31, 2004
    
    
    50.8100
    
    
    50.9900
    
    
    48.1000
    
    
    49.0000
    
    
    .25April
      30, 2004
    
    $
    66.5200
    
    $
    74.2000
    
    $
    48.1000
    
    $
    48.6000
    
    $
    17.75
 Item
      5(c).
    PURCHASES
      OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED
PURCHASERS.
  **ISSUER
PURCHASES OF EQUITY SECURITIES**
 
 **Period**
    
    
    **(a)
      Total Number of****Shares**
      **(or****Units)**
      **Purchased**
    
    
    **(b)
      Average Price Paid****Per
      Share**
      **(or
      Unit)**
    
    
    **(c)
      Total Number of****Shares**
      **(or
      Units) Purchased as Part of Publicly Announced**
      **Plans
      or Programs**
    
    
    **(d)
      Maximum Number**
      **(or
      Approximate Dollar Value) of Shares (or Units) that May Yet Be Purchased
      Under the Plans or Programs**February
      1, 2004 through February 29, 2004
    
    
    --
    
    
    --
    
    
    --
    
    
    **--**March
      1, 2004 through March 31, 2004
    
    
    229
    
    $
    50.882
    
    
    618,432
    
    
    Not
      determined.April
      1, 2004 through April 30, 2004
    
    
    **--**
    
    
    --
    
    
    --
    
    
    --Total
    
    
    229
    
    $
    50.882
    
    
    618,432
    
    
    **--**
 
 All
purchases were made by Arnold Bernhard & Co., Inc., an affiliate of the
issuer, pursuant to public announcements issued on December 24, 1997, November
24, 1999 and periodically thereafter.
 
 12
 Item
      6.
    SELECTED
      FINANCIAL DATA.
 
 Earnings
per share for each of the fiscal years shown below are based on the weighted
average number of shares outstanding.
 
 Years
      ended April 30,2004
    
    2003
    
    2002
    
    2001
    
    2000(in
      thousands, except per share amounts)Revenues:Investment
      periodicals and related publications
    
    $
    52,497
    
    $
    52,469
    
    $
    53,114
    
    $
    56,042
    
    $
    58,857Investment
      management fees and services
    
    $
    32,206
    
    $
    29,600
    
    $
    34,329
    
    $
    42,349
    
    $
    37,385Total
      revenues
    
    $
    84,703
    
    $
    82,069
    
    $
    87,443
    
    $
    98,391
    
    $
    96,242Income
      from operations
    
    $
    24,739
    
    $
    24,095
    
    $
    29,186
    
    $
    37,811
    
    $
    36,428Net
      income
    
    $
    20,350
    
    $
    19,987
    
    $
    20,323
    
    $
    24,091
    
    $
    33,698Earnings
      per share, basic and fully diluted
    
    $
    2.04
    
    $
    2.00
    
    $
    2.04
    
    $
    2.41
    
    $
    3.38Total
      assets
    
    $
    266,924
    
    $
    246,814
    
    $
    268,735
    
    $
    270,992
    
    $
    298,198Cash
      dividends declared per share
    
    $
    18.50
    
    $
    1.00
    
    $
    1.00
    
    $
    1.00
    
    $
    1.00
 
 
  13
  Item
      7.
    MANAGEMENT
      DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
      OPERATIONS.
 
 **FISCAL
2004**
 
 **Operating
Results**
  Net
income for the twelve months ended April 30, 2004 of $20,350,000 or $2.04 per
share was 2% above income of $19,987,000 or $2.00 per share for the same period
in fiscal 2003. Operating income of $24,739,000 for the twelve months ended
April 30, 2004 was 3% above operating income of $24,095,000 for the same period
of the last fiscal year. Operating income of $7,300,000 for the three months
ended April 30, 2004 was 7% higher than operating income of $6,843,000 for the
comparable period of the last fiscal year. Income from securities transactions
for the twelve months of fiscal 2004 was 25% above income for the same period of
fiscal 2003. Revenues of $84,703,000 for the twelve months ended April 30, 2004
were 3% higher than revenues of $82,069,000 in the prior fiscal year. Revenues
of $21,876,000 for the fourth quarter of fiscal 2004 were 9% above revenues of
$20,025,000 for the three months ended April 30, 2003.
  During
fiscal 2004, the Company’s stock outperformed the major market indices. Value
Line, Inc.’s. stock was up 34% for the twelve months ended April 30, 2004. In
April 2004, the Board of Directors of the Company declared a distribution from
its Retained Earnings in the form of a special dividend of $17.50 per share or
$174,678,000 to all shareholders of record as of May 7, 2004. The purpose of the
dividend was to return to all shareholders, in the form of cash, a significant
portion of the earnings of the Company from its successful operations over the
past number of years, at a time when shareholders can enjoy the present
favorable tax rates on dividends. Despite this significant distribution, Value
Line remains exceptionally strong financially with $35,298,000 of Shareholders’
Equity as of April 30, 2004 after declaration of the special
dividend.
  Subscription
revenues of $52,497,000 for the twelve months ended April 30, 2004 were
approximately equal to those for the same period of the prior fiscal year.
Although total revenues from all print products for the twelve months ended
April 30, 2004 were down 4% since the last fiscal year, revenues from all
electronic publications were up over 12% in fiscal 2004. Subscription revenues
of $13,728,000 for the fourth quarter of fiscal 2004 were 7% above revenues of
$12,874,000 for the three months ended April 30, 2003. While total revenues from
all print products for the three months ended April 30, 2004 were level with the
revenues for the fourth quarter of fiscal 2003, revenues from all electronic
publications were 11% above revenues for the comparable quarter of the last
fiscal year. Investment management fees and services revenues of $32,206,000 for
the twelve months ended April 30, 2004 were 9% above the prior fiscal year’s
revenues of $29,600,000. Investment management fees and services revenues of
$8,148,000 for the three months ended April 30, 2004 were 14% above the revenues
of $7,151,000 recorded in the fourth quarter of fiscal 2003.
  Operating
expenses for the twelve months ended April 30, 2004 of $59,964,000 were 3% above
the last year’s expenses of $57,974,000. Total advertising and promotional
expenses of $21,821,000 were 7% above the prior year’s expenses of $20,418,000
primarily due to additional costs associated with marketing two of the Company’s
equity mutual funds, increases in media advertising, higher fund supermarket
fees related to sales of the Value Line mutual funds shares, and increased
postage rates for direct mail. Successful direct mail campaigns resulted in an
 14
 
 increase in subscription activity since April 2003 with
total new full term subscription orders rising 11% from the level during the
twelve months of the prior fiscal year. Salaries and employee benefit expenses
of $20,764,000 were 4% above expenses of $19,938,000 recorded in the prior
fiscal year. Production and distribution costs for the twelve months ended April
30, 2004 of $8,733,000 were 7% below expenses of $9,400,000 for the twelve
months ended April 30, 2003. The decline in expenses was primarily due to lower
paper, printing and distribution costs that resulted from a migration in
circulation from print to electronic versions of our products and management’s
decision to discontinue issuing print copies of the Reference Library to trial
subscribers of *The
Value**Line
Investment Survey*and*The
VLIS Small and Mid-Cap Stock Edition*. Office
and administrative expenses of $8,646,000 were 5% above the last year’s expenses
of $8,218,000. The net increase in administrative expenses was primarily due to
higher rent expenses resulting from scheduled lease increases, higher bank
collection fees associated with an increase in the Company’s publishing credit
card business, and increases in professional fees.
 
 The
Company’s securities portfolios produced a gain of $8,266,000 for the twelve
months ended April 30, 2004 versus a gain of $6,626,000 for the same period of
the last fiscal year. The Company’s trading portfolio produced a gain of
$3,008,000 during the twelve months ended April 30, 2004 versus losses of
$940,000 during the same period of the last fiscal year. Income from securities
transactions for the twelve months ended April 30, 2004 also included dividend
and interest income of $4,259,000 and capital gains of $1,087,000 from sales of
securities from the Company’s long-term portfolio of equity and fixed income
securities. This compares to dividend and interest income of $4,361,000 and
capital gains of $3,211,000 from sales of securities from the Company’s
long-term portfolio for the same period of the last fiscal year.
  **Liquidity
and Capital Resources**
  The
Company had liquid resources, which were used in its business, of $73,790,000 at
April 30, 2004. In addition to $27,433 , 000 of
working capital, which has been reduced by the declaration of a $17.50 special
dividend to all shareholders of record on May 7, 2004, the Company has long-term
securities with a market value of $46,357,000, that, although classified as
non-current assets, are also readily marketable should the need
arise.
 
 The
Company’s cash flow from operations of $21,628,000 for the twelve months ended
April 30, 2004 was 29% higher than fiscal 2003’s cash flow of $16,816,000. The
rise in cash flow from operations was primarily due to a 11% increase in total
new full term subscription orders, an increase of 9% in the Company’s investment
management business, and containment of expenses. Net cash inflows of
$156,245,000 from investing activities during the twelve months of fiscal 2004
resulted primarily from sales of fixed income securities in preparation for
payment on May 19, 2004 of a special dividend in the amount of $174,678,000. The
cash inflows from investing activities were partially offset by additional
investments in the Company’s short-term equity trading portfolio. Net cash
outflows of $114,066,000 for investing activities for the twelve months of
fiscal 2003 were due largely to the Company’s decision last fiscal year to
re-deploy its cash and equity holdings into Government debt obligations with
higher effective yields.
 
 From time
to time, the Company’s Parent has purchased additional shares of Value Line,
Inc. in the market when and as the Parent has determined it to be appropriate.
As stated several
 15
 ****
 times in the past, the public is reminded that the
Parent may make additional purchases from time to time in the future.

Management believes that the Company’s cash and other liquid asset
resources used in its business together with the future cash flows from
operations will be sufficient to finance current and forecasted operations.
Management anticipates no borrowing for fiscal year
2005.
 
 **FISCAL
2003**
 
 **Operating
Results**
 
 Net
income for the twelve months ended April 30, 2003 of $19,987,000 or $2.00 per
share compared to net income of $20,323,000 or $2.04 per share in fiscal 2002. Net
income of $6,792,000 or $.68 per share for the last quarter of fiscal 2003
exceeded net income of $4,591,000 or $0.47 per share for the fourth quarter of
the prior fiscal year by 48% due primarily to a lower income tax rate and an
increase in income from securities transactions. The lower income tax rate was
the result of a favorable tax determination from a local tax jurisdiction
regarding the Company’s income allocation method. Operating
income of $24,095,000 for the twelve months ended April 30, 2003 was below
operating income of $29,186,000 for the same period of last fiscal year.
Revenues of $82,069,000 for the twelve months ended April 30, 2003 were the
seventh highest in the Company’s history and compared to revenues of $87,443,000
in the prior year. The decline in revenues and net income during the twelve
months ended April 30, 2003 was largely the result of a 14% decline in
investment management fees and services revenues that resulted primarily from a
decrease in average net asset values in the Value Line mutual funds. The change
in net asset values in Value Line’s mutual funds was largely attributable to the
overall decline in the financial markets with the NASDAQ index falling 13%
during the twelve months ended April 30, 2003, representing a 71% decline from
its all time high.
 
 During
fiscal 2003, t he
Company’s stock outperformed the major market indices. Value Line, Inc’s. stock
was up 2.4% for the twelve months ended April 30, 2003, while during this same
period, the NASDAQ index fell 13%.
 
 Subscription
revenues of $52,469,000 were 1% below revenues for the same period of the prior
fiscal year. The decrease in subscription revenues compared to the prior year’s
was primarily a result of the 2% decline in revenues from *The
Value*  *Line
Investment Survey* and
related products, which included *Value
Line Investment Survey for Windows, The Value Line Research Center, The Value
Line 600, The VLIS Small and Mid-Cap Stock Edition, and Value Line
Select* .
Investment management fees and services revenues of $29,600,000 for the twelve
months ended April 30, 2003 were 14% below the prior fiscal year’s revenues of
$34,329,000. The change in total revenues was primarily attributable to the
continued difficult financial market conditions impacting severely on investment
management fees and services revenues, with stable subscription revenue
moderating the overall effect.
 
 Operating
expenses for the twelve months ended April 30, 2003 of $57,974,000 were
comparable to last year’s expenses of $58,257,000. Total advertising and
promotional expenses of $20,418,000 were 2% above the prior year’s expenses of
$19,928,000. The increase in advertising expenses resulted primarily from a 9%
increase in postage rates associated with the Company’s direct mail advertising
for the Company’s publications and the Value Line’s mutual funds and an increase
in discount brokerage commissions incurred for sales of Value Line’s
 16
 
 mutual funds’ shares. Salaries and employee benefit
expenses of $19,938,000 were 9% below expenses of $21,801,000 recorded in the
prior fiscal year. Production and distribution costs for the twelve months ended
April 30, 2003 of $9,400,000 were 6% above expenses of $8,831,000 for the twelve
months ended April 30, 2002. The increase in production and distribution
expenses resulted from an increase in the average subscription circulation and
the aforementioned increase in U.S. postal rates. Additionally, expenses
associated with outsourcing a portion of the Company’s stock and mutual fund
data collection services and amortization of previously deferred costs for the
development of computer software for internal use contributed to the higher
production expenses. Office and administrative expenses of $8,218,000 were 7%
above last year’s expenses of $7,697,000. The net increase in administrative
expenses compared to last year’s resulted primarily from higher insurance
premiums and increases in professional fees.
 
 The
Company’s securities portfolios produced a gain of $6,626,000 for the twelve
months ended April 30, 2003, which was 14% above the gain of $5,828,000 for the
same period of last fiscal year. The Company’s trading portfolio produced losses
of $940,000 during the twelve months ended April 30, 2003 versus losses of
$5,625,000 during the same period of last fiscal year. The value of the
Company’s securities portfolios has been negatively impacted by the declining
financial market with the NASDAQ down 13% during the twelve months ended April
30, 2003. Income from securities transactions for the twelve months ended April
30, 2003 also included dividend and interest income of $4,361,000 and capital
gains of $3,211,000 from sales of securities from the Company’s long-term
portfolio. This compares to dividend and interest income of $2,829,000 and
capital gains of $8,633,000 from sales of securities from the Company’s
long-term portfolio for the same period of last fiscal year.
  **Liquidity
and Capital Resources**
  The
Company had liquid resources, which were used in its business, of $228,471,000
at April 30, 2003. In addition to $12,408 , 000 of
working capital, the Company had long-term securities with a market value of
$216,063,000, that, although classified as non-current assets, are also readily
marketable should the need arise.
 
 The
Company’s cash flow from operations of $16,816,000 for the twelve months ended
April 30, 2003 was 17% lower than fiscal 2002’s cash flow of $20,145,000. The
decrease in cash flow from operations was primarily a result of lower pretax
earnings and a decrease in unserved paid subscription orders. Net cash outflows
of $114,066,000 from investing activities during the twelve months of fiscal
2003 were $134,841,000 higher than net cash inflows for the twelve months of
fiscal 2002 due largely to the Company’s decision to re-deploy its cash holdings
into Government debt obligations with higher effective yields.
 
 From time
to time, the Company’s Parent has purchased additional shares of Value Line,
Inc. in the market when, and as the Parent has determined it to be appropriate.
The Company understands that the Parent may make additional purchases from time
to time in the future.
 
 Management
believes that the Company’s cash and other liquid asset resources used in its
business together with the future cash flows from operations will be sufficient
to finance current and forecasted operations. Management anticipates no
borrowing for fiscal year 2004.
 
 17
 
 Item
      7A.
    QUANTITATIVE
      AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
 
 **Market
Risk Disclosures**
 
 Value
Line, Inc.’s Consolidated Balance Sheet includes a substantial amount of assets
and liabilities whose fair values are subject to market risks. Value Line’s
significant market risks are primarily associated with interest rates and equity
prices. The following sections address the significant market risks associated
with Value Line’s business activities.
 
 **Interest
Rate Risk**
 
 Value
Line’s management prefers to invest in highly liquid, U.S. government debt
securities with extremely low credit risk. Although the principal is secure, the
price of these debt instruments is interest rate sensitive. Value Line’s
strategy is to acquire securities that are attractively priced in relation to
the perceived credit risk. Management recognizes and accepts that losses may
occur. To limit the price fluctuation in these securities from interest rate
changes, Value Line’s management invests in relatively short-term obligations
maturing in 1 to 5 years.
 
 The fair
values of Value Line’s fixed maturity investments will fluctuate in response to
changes in market interest rates. Increases and decreases in prevailing interest
rates generally translate into decreases and increases in fair values of those
instruments. Additionally, fair values of interest rate sensitive instruments
may be affected by prepayment options, relative values of alternative
investments, and other general market conditions.
 
 The
following table summarizes the estimated effects of hypothetical increases and
decreases in interest rates on assets that are subject to interest rate risk. It
is assumed that the changes occur immediately and uniformly to each category of
instrument containing interest rate risks. The hypothetical changes in market
interest rates do not reflect what could be deemed best or worst case scenarios.
Variations in market interest rates could produce significant changes in the
timing of repayments due to prepayment options available. For these reasons,
actual results might differ from those reflected in the table. Dollars are in
thousands.
  Estimated
      Fair Value afterHypothetical
      Change in Interest Rates(bp
      = basis points)Fair
    
    100bp
    
    100bp
    
    200bp
    
    300bpFixed
      Income Securities
    
    Value
    
    decrease
    
    increase
    
    increase
    
    increaseAs
      of April 30, 2004Investments
      in securities with fixed maturities
    
    $
    1
    
    $
    1
    
    $
    1
    
    $
    1
    
    $
    1As
      of April 30, 2003Investments
      in securities with fixed maturities
    
    $
    170,913
    
    $
    181,299
    
    $
    161,900
    
    $
    153,116
    
    $
    144,739
 
 During
the last quarter of fiscal year 2004, the Company sold virtually all of its
long-term holdings of fixed maturity investments and transferred the proceeds to
cash in preparation for payment of a special $17.50 per share dividend, declared
on April 23, 2004. The sale greatly reduced the Company’s exposure to risks
associated with interest rate changes. Management regularly monitors the
maturity structure of the Company’s investments in fixed maturity U.S.
government debt obligations in order to maintain an acceptable price risk
associated with changes in interest rates.
 ****
 18
 ****
 **Equity
Price Risk**
 
 The
carrying values of investments subject to equity price risks are based on quoted
market prices or management’s estimates of fair value as of the balance sheet
dates. Market prices are subject to fluctuation and, consequently, the amount
realized in the subsequent sale of an investment may significantly differ from
the reported market value. Fluctuation in the market price of a security may
result from perceived changes in the underlying economic characteristics of the
investee, the relative price of alternative investments and general market
conditions. Furthermore, amounts realized in the sale of a particular security
may be affected by the relative quantity of the security being
sold.
 
 Value
Line invests a significant level of its assets in equity securities, primarily
the Value Line family of equity mutual funds. Each mutual fund invests in a
variety of equity positions of various companies thereby diversifying Value
Line’s risk. The Company’s objectives include maintenance of a greater weighting
in large and mid capitalization companies in its equity portfolio to minimize
price risk. Value Line has also utilized derivative financial instruments in the
past to minimize market price risk, although no such derivative financial
instruments were utilized during fiscal 2004 and 2003.
 
 The table
below summarizes Value Line’s equity price risks as of April 30, 2004 and 2003
and shows the effects of a hypothetical 30% increase and a 30% decrease in
market prices as of those dates. The selected hypothetical change does not
reflect what could be considered the best or worst case scenarios. Dollars are
in thousands.
 
 Equity
      Securities
    
    Fair
      Value
    
    HypotheticalPrice
      Change
    
    EstimatedFair Value afterHypotheticalChange
      in Prices
    
    Hypothetical
      PercentageIncrease (Decrease) inShareholders’
      EquityAs
      of April 30, 2004
    
    $
    46,353
    
    
    30%
      increase
    
    $
    60,259
    
    
    39.4
    %30%
      decrease
    
    
    32,447
    
    
    (39.4
    )%As
      of April 30, 2003
    
    $
    45,150
    
    
    30%
      increase
    
    $
    58,695
    
    
    4.4
    %30%
      decrease
    
    
    31,605
    
    
    (4.4
    )%
 
 Although
the risk associated with equity price changes does not significantly change the
value of the Company’s equity securities holdings at fiscal year end April 30,
2004 as compared to April 30, 2003, the percentage increase/decrease in
shareholder’s equity has more dramatically changed as a result of the lower
shareholder equity balance that resulted from the declaration of the special
$17.50 special dividend during the quarter ended April 30, 2004.
 
  19
  Item
      8.
    FINANCIAL
      STATEMENTS AND SUPPLEMENTARY DATA.
 
 The
following consolidated financial statements of the registrant and its
subsidiaries are included as a part of this Form 10K:
 
 Page
      NumbersReports
      of independent accountants
    30Consolidated
      balance sheets--April 30, 2004 and 2003
    31Consolidated
      statements of income and retained earnings--years ended April 30, 2004,
      2003 and 2002
    32Consolidated
      statements of cash flows--years ended April 30, 2004, 2003 and
      2002
    33Consolidated
      statement of changes in stockholders’ equity--years ended April 30, 2004,
      2003 and 2002
    34Notes
      to the consolidated financial statements
    35Supplementary
      schedules
    46
 
 
 Quarterly
Results (Unaudited):
 (in
thousands, except per share amounts)
 
 Income
    
    
    
    EarningsTotal
    
    From
    
    Net
    
    PerRevenues
    
    Operations
    
    Income
    
    Share2004,
      by Quarter -First
    
    $
    20,918
    
    $
    5,572
    
    $
    4,998
    
    $
    0.50Second
    
    
    20,566
    
    
    5,827
    
    
    5,525
    
    
    0.55Third
    
    
    21,343
    
    
    6,040
    
    
    4,904
    
    
    0.49Fourth
    
    
    21,876
    
    
    7,300
    
    
    4,923
    
    
    0.50Total
    
    $
    84,703
    
    $
    24,739
    
    $
    20,350
    
    $
    2.042003,
      by Quarter -First
    
    $
    20,505
    
    $
    4,975
    
    $
    3,000
    
    $
    0.30Second
    
    
    20,386
    
    
    6,379
    
    
    4,524
    
    
    0.45Third
    
    
    21,153
    
    
    5,898
    
    
    5,671
    
    
    0.57Fourth
    
    
    20,025
    
    
    6,843
    
    
    6,792
    
    
    0.68Total
    
    $
    82,069
    
    $
    24,095
    
    $
    19,987
    
    $
    2.002002,
      by Quarter -First
    
    $
    22,840
    
    $
    7,287
    
    $
    4,599
    
    $
    0.46Second
    
    
    21,777
    
    
    7,290
    
    
    5,515
    
    
    0.55Third
    
    
    21,620
    
    
    6,315
    
    
    5,618
    
    
    0.56Fourth
    
    
    21,206
    
    
    8,294
    
    
    4,591
    
    
    0.47Total
    
    $
    87,443
    
    $
    29,186
    
    $
    20,323
    
    $
    2.04
 
 
 20
  Item
      9.
    CHANGES
      IN AND DISAGREEMENTS WITH ACCOUNTANTS ONACCOUNTING
      AND FINANCIAL DISCLOSURE.
 
 There
have been no disagreements with the independent accountants on accounting
and financial disclosure matters.
 
 Item
      9A.
    CONTROLS
      AND PROCEDURES.
 
 (a)
    Evaluation
      of controls and procedures.
 
 The
Company’s Chief Executive Officer and Chief Financial Officer have reviewed and
evaluated the effectiveness of the Company’s disclosure controls and procedures
(as defined in the Exchange Act) within the past ninety days. Based on that
evaluation, the Chief Executive Officer and the Chief Financial Officer have
concluded that the Company’s current disclosure controls and procedures are
effective in providing them on a timely basis with material information relating
to the Company required to be disclosed in the reports the Company files or
submits under the Exchange Act.
 
 (b)
    Changes
      in internal controls.
 
 There
have not been any significant changes in the Company’s internal controls or in
other factors that could significantly affect these controls subsequent to the
date of their evaluation. There were no significant deficiencies or material
weaknesses and, therefore, no corrective actions were taken.
  21
  Part
III
 
 Item 10.
DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.
 
 Director(a)      
      Names of Directors, Age as of June 16, 2004 and Principal
    Occupation
    
    
    Since
  Jean
      Bernhard Buttner* (69). Chairman of the Board, President, and Chief
      Executive Officer of the Company and Arnold
    
    
    1982Bernhard & Co., Inc. Chairman of the Board
      and President of each of the Value Line Funds.Harold
      Bernard, Jr. (73). Attorney-at-law. Retired Administrative Law Judge,
      National
      Labor Relations Board. Director of
    
    
    1982Arnold
      Bernhard & Co., Inc. Judge Bernard is a cousin of Jean Bernhard
      Buttner.Samuel
      Eisenstadt (81). Senior Vice President and Research Chairman of the Company.
    
    
    1982Herbert
      Pardes, MD (70). President and CEO of New York- Presbyterian Hospital.
    
    
    2000Marion
      Ruth (69). Real Estate Executive. President, Ruth Realty (real estate
      broker).
      Director or Trustee of each of the
    
    
    2000Value Line Funds.Howard
      A. Brecher* (50). Vice President of the Company since 1996 and Secretary
      since 1992; Secretary, Treasurer and
    
    
    1992General Counsel of Arnold
      Bernhard & Co., Inc. since 1991, Director since 1992 and Vice
      President since 1994.David
      T. Henigson* (46). Vice President of the Company since 1992 and Treasurer
      since 1994; Director of Compliance
    
    
    1992and Internal Audit of the Company
      since 1988; Vice President of each of the Value Line Funds since 1992 and
      Secretaryand Treasurer since
      1994; Vice President and Director
      of Arnold Bernhard & Co., Inc. since 1992.Edgar
      A. Buttner (41). Postdoctoral Fellow, Harvard University since 2003;
      Research Associate, McLean Hospital, 2002-
    
    
    20032003; Postdoctoral Fellow,
      Massachusetts Institute of Technology, 1997-2001; Director of Arnold
      Bernhard & Co., Inc.Dr.
      Buttner is the son of Jean Bernhard Buttner.Marianne
      Asher (38). Private investor, graduate somatic counselor; Director of
      Arnold Bernhard & Co., Inc. Mrs. Asher
    
    
    2004is
      a daughter of Jean Bernhard Buttner.
 
 *
    Member
      of the Executive Committee
 
 (b)
    The
      information pertaining to Executive Officers is set forth in Part I under
      the caption"Executive
      Officers of the Registrant."
 
 22
 
 Audit
Committee
 
 The
Company has a standing Audit Committee established in accordance with Section
3(a)(58)(A) of the Securities Exchange Act of 1934, the members of which are:
Harold Bernard, Jr., Dr. Herbert Pardes and Marion N. Ruth.
 
 Audit
Committee Financial Expert
 
 The Board
of Directors has determined that no member of the Audit Committee is an “audit
committee financial expert” (as defined in the rules and regulations of the
Securities and Exchange Commission). The current members of the Audit Committee
have served on the Audit Committee for a minimum of four years and the Board of
Directors believes that the experience and financial sophistication of the
members of the Audit Committee are sufficient to permit the members of the Audit
Committee to fulfill the duties and responsibilities of the Audit Committee. All
members of the Audit Committee meet the Nasdaq Stock Market’s audit committee
financial sophistication requirements.
 
 Code of
Ethics
 
 The
Company has adopted a Code of Business Conduct and Code of Ethics that applies
to its principal executive officer, principal financial officer and principal
accounting officer.
 
  23
  Item 11.
    EXECUTIVE
      COMPENSATION.
 
 SUMMARY
COMPENSATION TABLE
 
 The
following table sets forth information concerning the compensation for services
in all capacities to the Company for the fiscal years ended April 30, 2004, 2003
and 2002 of the chief executive officer of the Company and each of the other
executive officers of the Company who were serving at April 30,
2004.
  Long-TermCompensationAwardsRestricted
    
    
    
    All
      OtherName
      and
    
    Fiscal
    
    Annual
      Compensation
    
    StockAward(s)
    
    OptionsGranted
    
    Compensation(b)Principal
      Position
    
    Year
    
    Salary($)
    
    Bonus(a)($)
    
    ($)
    
    (#)
    
    ($)Jean
      B. Buttner
    
    
    2004
    
    
    917,286
    
    
    - 0
      -
    
    
    --
    
    
    --
    
    
    16,814Chairman
      of the Board
    
    
    2003
    
    
    898,419
    
    
    - 0
      -
    
    
    --
    
    
    --
    
    
    16,017and
      Chief Executive Officer
    
    
    2002
    
    
    881,667
    
    
    - 0
      -
    
    
    --
    
    
    --
    
    
    17,976Samuel
      Eisenstadt
    
    
    2004
    
    
    138,900
    
    
    125,000
    
    
    --
    
    
    --
    
    
    13,890Senior
      Vice President
    
    
    2003
    
    
    138,900
    
    
    122,917
    
    
    --
    
    
    --
    
    
    13,547and
      Research Chairman
    
    
    2002
    
    
    136,250
    
    
    120,000
    
    
    --
    
    
    --
    
    
    13,469David
      T. Henigson
    
    
    2004
    
    
    100,000
    
    
    415,000
    
    
    --
    
    
    --
    
    
    10,000Vice
      President
    
    
    2003
    
    
    100,000
    
    
    415,000
    
    
    --
    
    
    --
    
    
    9,8002002
    
    
    100,000
    
    
    395,000
    
    
    --
    
    
    --
    
    
    10,000Howard
      A. Brecher
    
    
    2004
    
    
    50,000
    
    
    400,000
    
    
    --
    
    
    --
    
    
    5,000Vice
      President
    
    
    2003
    
    
    50,000
    
    
    375,000
    
    
    --
    
    
    --
    
    
    4,9002002
    
    
    50,000
    
    
    325,000
    
    
    --
    
    
    --
    
    
    5,000Stephen
      R. Anastasio (c)
    
    
    2004
    
    
    100,000
    
    
    120,000
    
    
    --
    
    
    --
    
    
    10,000Chief
      Financial Officer;
    
    
    2003
    
    
    100,000
    
    
    120,000
    
    
    --
    
    
    --
    
    
    9,800Corporate
      Controller
    
    
    2002
    
    
    100,000
    
    
    101,062
    
    
    --
    
    
    --
    
    
    10,000
 
 (a)
    A
      portion of the bonuses are contingent upon future
employment.
 
 (b)
    Employees
      of the Company are members of the Value Line Profit Sharing and Savings
      Plan (the "Plan"). The Plan provides for a defined annual contribution
      which is determined by a formula based upon the salaries of eligible
      employees and the amount of consolidated net operating income as defined
      in the Plan. The Company's contribution expense was $1,217,000 for the
      year ended April 30, 2004. Each employee's interest in the Plan is
      invested in such proportions as the employee may elect in shares of one or
      more of the mutual funds for which the Company acts as investment adviser.
      Distributions under the Plan vest in accordance with a schedule based upon
      the employee's length of service and are payable upon the employee's
      retirement, death, total and permanent disability or termination of
      employment.
 
 (c)
    Mr.
      Anastasio became Chief Financial Officer in April
2003.
 
 
 24
 
 
 Item
      12.
    SECURITY
      OWNERSHIP OF CERTAIN BENEFICIAL OWNERS ANDMANAGEMENT.
 
 The
following table sets forth information as of June 16, 2004 as to shares of the
Company's Common Stock held by persons known to the Company to be the beneficial
owners of more than 5% of the Company's Common Stock.
 
 Number
      of Shares
    
    Percentage
      of SharesName
      and Addressof Beneficial Owner
    
    Beneficially
      Owned
    
    Beneficially
      Owned(1)Arnold
      Bernhard &
      Co., Inc.(1)
    
    
    8,609,632
    
    
    86.26
    %220
      East 42nd StreetNew
      York, NY 10017
 
 ____________________
 (1)
    Jean
      Bernhard Buttner, Chairman of the Board, President and Chief Executive
      Officer of theCompany,
      owns all of the outstanding voting stock of Arnold Bernhard & Co.,
      Inc.
 
 The
following table sets forth information as of June 16, 2004, with respect to
shares of the Company's Common Stock owned by each director of the Company, by
each executive officer listed in the Summary Compensation Table and by all
officers and directors as a group.
 
 Number
      of Shares
    
    Percentage
      of SharesName
      and Addressof Beneficial Owner
    
    Beneficially
      Owned
    
    Beneficially
      Owned(1)Jean
      Bernhard Buttner
    
    
    100
    (1)
    
    *Harold
      Bernard, Jr.
    
    
    450
    
    
    *Howard
      A. Brecher
    
    
    200
    
    
    *Samuel
      Eisenstadt
    
    
    100
    
    
    *David
      T. Henigson
    
    
    150
    
    
    *Dr.
      Herbert Pardes
    
    
    100
    
    
    *Marion
      Ruth
    
    
    200
    
    
    *Stephen
      R. Anastasio
    
    
    100
    
    
    *Edgar
      A. Buttner
    
    
    100
    
    
    *Marianne
      Asher
    
    
    -0-
    
    
    *All
      directors and executiveofficers as a group (10
      persons)
    
    
    1,500
    (1)
    
    *
 ______________
 *Less
than one percent
 
 (1)
    Excludes
      8,609,632 shares (86.26% of the outstanding shares) owned byArnold
      Bernhard & Co., Inc. Jean Bernhard Buttner owns all of the outstandingvoting
      stock of Arnold Bernhard & Co., Inc. Substantially all of the
      non-votingstock
      of Arnold Bernhard & Co., Inc. is held by members of the Buttner
      family.
 
  25
  Item
      13.
    CERTAIN
      RELATIONSHIPS AND RELATED TRANSACTIONS.
 
 Arnold
Bernhard & Co., Inc. utilizes the services of officers and employees of the
Company to the extent necessary to conduct its business. The Company and Arnold
Bernhard & Co., Inc. allocate costs for office space, equipment and supplies
and support staff pursuant to a servicing and reimbursement arrangement. During
the year ended April 30, 2004, the Company was reimbursed $489,000 for such
expenses. In addition, a tax-sharing arrangement allocates the tax liabilities
of the two companies between them. The Company pays to Arnold Bernhard &
Co., Inc. an amount equal to the Company's liability as if it filed separate tax
returns.
 
 Item
      14.
    PRINCIPAL
      ACCOUNTANT FEES AND SERVICES.
 
 Audit and
Non-Audit Fees
 
 For the
fiscal year ended April 30, 2004 and 2003, fees for services provided by
Horowitz & Ullmann, P.C. were as follows:
 
 2004
    
    2003Audit
      services
    
    $
    125,625
    
    $
    119,300Financial
      information systems design andimplementation
    
    
    0
    
    
    0All
      other (including tax consulting)
    
    $
    125,200
    
    $
    135,765
 
 
 Part
IV
 
 Item
      15.
    EXHIBITS,
      FINANCIAL STATEMENT SCHEDULES AND REPORTSON
      FORM 8-K.
 
 (a)
    1.Financial
      Statements
 See Item
8.
 
 2.
    Schedules
 Schedule
I - Marketable Securities.
 Schedule
XIII - Other Investments. (Reg. S-X, Article 5)
 
 All other
Schedules are omitted because they are not applicable or the required information
is shown in the financial statements or notes thereto.
 
 3.
    Exhibits
 
 3.1
    Articles
      of Incorporation of the Company, as amended through April 17, 1983, are
      incorporated by reference to the Registration Statement - Form S-1 of
      Value Line, Inc. Part II, Item 16.(a) 3.1 filed with the Securities and
      Exchange Commission on April 7, 1983.
 
 3.2
    Certificate
      of Amendment of Certificate of Incorporation dated October 24,
    1989.
  10.8
    Form
      of tax allocation arrangement between the Company and
      AB&Co.incorporated
      by reference to the Registration Statement - Form S-1 of Value
      Line,Inc.
      Part II, Item 16.(a) 10.8 filed with the Securities and Exchange
      Commissionon
      April 7, 1983.
 
 26
 10.9
    Form
      of Servicing and Reimbursement Agreement between the Company
      andAB&Co.,
      dated as of November 1, 1982 incorporated by reference to theRegistration
      Statement - Form S-1 of Value Line, Inc. Part II, Item 16.(a)
      10.9filed
      with the Securities and Exchange Commission on April 7,
1983.
 
 10.10
    Value
      Line, Inc. Profit Sharing and Savings Plan as amended and restatedeffective
      May 1, 1989, including amendments through April 30,
      1995,incorporated
      by reference to the Annual Report on Form 10-K for the year endedApril
      30, 1996.
 
 10.13
    Lease
      for the Company's premises at 220 East 42nd Street, New York,
      N.Y.incorporated
      by reference to the Annual Report on Form 10-K for the year
      endedApril
      30, 1994.
 
 21
    Subsidiaries
      of the Registrant.
 
 31
    Rule
      13a-14 and 15d-14 Certifications
 
 32
    Section
      1350 Certifications
 
 (b)
    Reports
      on Form 8-K.
 
 On April
23, 2004, the Company filed a report on Form 8-K that stated the Board of
Directors of the Company declared a special dividend of $17.50 per common share
to shareholders
of record on May 7, 2004 payable on May 19, 2004.
 
 (c)
    Code
      of Business Conduct and Ethics.
 
 
 
 
  27
   SIGNATURES
  Pursuant
to the requirements of Section 13 or 15(d) of the Securities Exchange Act of
1934, the Registrant has duly caused this report on Form 10-K for the fiscal
year ended April 30, 2004, to be signed on its behalf by the undersigned,
thereunto duly authorized.
 
 VALUE LINE,
      INC.(Registrant)By:
    /s/ Jean Bernhard
      ButtnerJean Bernhard ButtnerChairman
      & Chief Executive 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 the Registrant and in the
capacities and on the dates indicated.
 
 By:
    /s/ Jean Bernhard
      ButtnerJean Bernhard ButtnerChairman
      & Chief Executive Officer
 By:
    /s/ Stephen R.
      AnastasioStephen R. AnastasioChief
      Financial Officer
 By:
    /s/ David T.
    HenigsonDavid T. HenigsonVice
      President and Treasurer
 
 Dated: February 25, 2005
 28
 
 Pursuant
to the requirements of Section 13 or 15(d) of the Securities Exchange Act of
1934, the Registrant has duly caused this report on Form 10-K for the fiscal
year ended April 30, 2004, to be signed on its behalf by the undersigned as
Directors of the Registrant.
  /s/
      Jean Bernhard Buttner
    
    
    /s/
      Howard A. BrecherJean
      Bernhard Buttner
    
    
    Howard
      A. Brecher/s/
      Harold Bernard, Jr.
    
    
    /s/
      Samuel EisenstadtHarold
      Bernard, Jr.
    
    
    Samuel
      Eisenstadt/s/
      Marion N. Ruth
    
    
    /s/ David
      T. HenigsonMarion
      N. Ruth
    
    
    David
      T. Henigson/s/
      Dr. Herbert Pardes
    
    
    /s/
      Edgar A. ButtnerDr.
      Herbert Pardes
    
    
    Edgar
      A. Buttner/s/
      Marianne AsherMarianne
      Asher
 
 Dated: February 25, 2005
  29
  ****


275
      Madison AvenueNew
      York, NY  10016A
      member of the
    Telephone:
      (212) 532-3736AICPA
      SEC Practice Section
    Facsimile:
      (212) 545-8997New
      York State Society of CPAs
    E-mail:
      epas@horowitz-ullmann.com
****
**Report
of Independent Accountants**

To the
Board of Directors
and
Shareholders of
Value
Line, Inc.

In our
opinion, the accompanying consolidated balance sheets and the related
consolidated statements of income and retained earnings, changes in
stockholders’ equity, and cash flows present fairly, in all material respects,
the financial position of Value Line, Inc. and subsidiaries at April 30, 2004
and 2003, and the results of their operations, changes in stockholders’ equity,
and their cash flows for each of the three years in the period ended April 30,
2004, in conformity with accounting principles generally accepted in the United
States of America. These financial statements are the responsibility of the
Company’s management; our responsibility is to express an opinion on these
financial statements based on our audits.

We
conducted our audits of these statements 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, assessing the accounting principles
used and significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for the opinion expressed above.

Our
audits of the consolidated financial statements referred to above also included
an audit of the Financial Statement Schedules listed in Item 15 (a) of Form
10-K. In our opinion, these Financial Statement Schedules present fairly, in all
material respects, the information set forth therein when read in conjunction
with the related consolidated statements.





July 12,
2004
New York,
NY
 30
 
 **Value
      Line, Inc.****Consolidated
      Balance Sheets****(in
      thousands, except share amounts)**

**Apr.
      30,**
    
    **Apr.
      30,****Assets**
    
    **2004**
    
    **2003****Current
      Assets:**Cash
      and cash equivalents (including short terminvestments of $177,682,
      and $9,774, respectively)
    
    $
    178,108
    
    $
    10,217Trading
      securities
    
    
    19,981
    
    
    3,093Receivable
      from clearing brokers
    
    
    5,356
    
    
    932Accounts
      receivable, net of allowance for doubtfulaccounts of $40, and $41,
      respectively
    
    
    1,842
    
    
    1,914Receivable
      from affiliates
    
    
    2,920
    
    
    2,310Prepaid
      expenses and other current assets
    
    
    1,911
    
    
    1,244Deferred
      income taxes
    
    
    104
    
    
    48**Total
      current assets**
    
    
    210,222
    
    
    19,758Long
      term securities available for sale
    
    
    46,357
    
    
    216,063Property
      and equipment, net
    
    
    6,545
    
    
    7,393Capitalized
      software and other intangible assets, net
    
    
    3,800
    
    
    3,600**Total
      assets**
    
    $
    266,924
    
    $
    246,814**Liabilities
      and Shareholders' Equity****Current
      Liabilities:**Accounts
      payable, accrued expenses andother
    liabilities
    
    $
    3,619
    
    $
    2,852Accrued
      salaries
    
    
    1,576
    
    
    1,390Dividends
      payable
    
    
    177,172
    
    
    2,495Accrued
      taxes payable
    
    
    422
    
    
    613**Total
      current liabilities**
    
    
    182,789
    
    
    7,350Unearned
      revenue
    
    
    40,871
    
    
    38,579Deferred
      income taxes
    
    
    7,684
    
    
    5,157Deferred
      charges
    
    
    282
    
    
    350**Shareholders'
      Equity:**Common
      stock, $.10 par value; authorized 30,000,000shares; issued
      10,000,000 shares
    
    
    1,000
    
    
    1,000Additional
      paid-in capital
    
    
    991
    
    
    991Retained
      earnings
    
    
    19,459
    
    
    183,768Treasury
      stock, at cost (18,400 shares on4/30/04, and
      4/30/03)
    
    
    (354
    )
    
    (354
    )Accumulated
      other comprehensive income, net of tax
    
    
    14,202
    
    
    9,973**Total
      shareholders' equity**
    
    
    35,298
    
    
    195,378**Total
      liabilities and shareholders' equity**
    
    $
    266,924
    
    $
    246,814**See
      independent auditor's report and accompanying notes to the consolidated
      financial statements.**
 
 31
 
 **Value
      Line, Inc.****Consolidated
      Statements of Income and Retained Earnings****(in
      thousands, except per share
amounts)**

**Years
      ended April 30,****2004**
    
    **2003**
    
    **2002****Revenues:**Investment
      periodicals and related publications
    
    $
    52,497
    
    $
    52,469
    
    $
    53,114Investment
      management fees & services
    
    
    32,206
    
    
    29,600
    
    
    34,329Total
      revenues
    
    
    84,703
    
    
    82,069
    
    
    87,443**Expenses:**Advertising
      and promotion
    
    
    21,821
    
    
    20,418
    
    
    19,928Salaries
      and employee benefits
    
    
    20,764
    
    
    19,938
    
    
    21,801Production
      and distribution
    
    
    8,733
    
    
    9,400
    
    
    8,831Office
      and administration
    
    
    8,646
    
    
    8,218
    
    
    7,697Total
      expenses
    
    
    59,964
    
    
    57,974
    
    
    58,257**Income
      from operations**
    
    
    24,739
    
    
    24,095
    
    
    29,186Income
      from securities transactions, net
    
    
    8,266
    
    
    6,626
    
    
    5,828Income
      before income taxes
    
    
    33,005
    
    
    30,721
    
    
    35,014Provision
      for income taxes
    
    
    12,655
    
    
    10,734
    
    
    14,691**Net
      income**
    
    $
    20,350
    
    $
    19,987
    
    $
    20,323Retained
      earnings, at beginning of year
    
    
    183,768
    
    
    173,760
    
    
    163,416Dividends
      declared
    
    
    (184,659
    )
    
    (9,979
    )
    
    (9,979
    )Retained
      earnings, at end of year
    
    $
    19,459
    
    $
    183,768
    
    $
    173,760**Earnings
      per share, basic and fully diluted**
    
    $
    2.04
    
    $
    2.00
    
    $
    2.04**See
      independent auditor's report and accompanying notes to the consolidated
      financial statements.**
 
 32
 
 **Value
      Line, Inc.****Consolidated
      Statements of Cash Flows****(in
      thousands)**

**Years
      ended April 30,****2004**
    
    **2003**
    
    **2002****Cash
      flows from operating activities:**Net
      income
    
    $
    20,350
    
    $
    19,987
    
    $
    20,323Adjustments
      to reconcile net income to net cashprovided by operating
      activities:Depreciation
      and amortization
    
    
    2,726
    
    
    3,274
    
    
    3,115Gains
      on sales of trading securities andsecurities available for
      sale
    
    
    (3,075
    )
    
    (2,242
    )
    
    (3,277
    )Unrealized
      gains on trading securities
    
    
    (942
    )
    
    (75
    )
    
    258Deferred
      income taxes
    
    
    193
    
    
    (1,690
    )
    
    1,049Changes
      in assets and liabilities:Proceeds
      from sales of trading securities
    
    
    41,549
    
    
    4,227
    
    
    37,536Purchases
      of trading securities
    
    
    (55,406
    )
    
    (4,591
    )
    
    (31,414
    )Increase/(decrease)
      in unearned revenue
    
    
    2,292
    
    
    (2,060
    )
    
    1,113(Decrease)/increase
      in deferred charges
    
    
    (344
    )
    
    73
    
    
    (277
    )Increase/(decrease)
      in accounts payable and accrued expenses
    
    
    1,043
    
    
    (552
    )
    
    (1,900
    )Increase/(decrease)
      in accrued salaries
    
    
    186
    
    
    (469
    )
    
    (432
    )(Decrease)/increase
      in accrued taxes payable
    
    
    (191
    )
    
    486
    
    
    (395
    )(Increase)/decrease
      in prepaid expenses and other current assets
    
    
    (667
    )
    
    (40
    )
    
    70(Increase)/decrease
      in accounts receivable
    
    
    667
    
    
    (33
    )
    
    144(Increase)/decrease
      in receivable from affiliates
    
    
    (610
    )
    
    157
    
    
    354Total
      adjustments
    
    
    (12,579
    )
    
    (3,535
    )
    
    5,944**Net
      cash provided by operations**
    
    
    7,771
    
    
    16,452
    
    
    26,267**Cash
      flows from investing activities:**Proceeds
      from sales of long term securities
    
    
    5,788
    
    
    39,598
    
    
    56,102Purchases
      of long term securities
    
    
    (1,425
    )
    
    (6,894
    )
    
    (14,279
    )Proceeds
      from sales of fixed income securities
    
    
    229,127
    
    
    57,471
    
    
    ---Purchases
      of fixed income securities
    
    
    (61,210
    )
    
    (202,040
    )
    
    (25,074
    )Acquisition
      of property and equipment
    
    
    (271
    )
    
    (229
    )
    
    (447
    )Expenditures
      for capitalized software
    
    
    (1,907
    )
    
    (1,608
    )
    
    (1,649
    )**Net
      cash (used in) investing activities**
    
    
    170,102
    
    
    (113,702
    )
    
    14,653**Cash
      flows from financing activities:**Proceeds
      from sales of treasury stock
    
    
    ---
    
    
    45
    
    
    35Dividends
      paid
    
    
    (9,982
    )
    
    (9,979
    )
    
    (9,978
    )**Net
      cash used in financing activities**
    
    
    (9,982
    )
    
    (9,934
    )
    
    (9,943
    )**Net
      increase/(decrease) in cash and cash equivalents**
    
    
    167,891
    
    
    (107,184
    )
    
    30,977**Cash
      and cash equivalents at beginning of year**
    
    
    10,217
    
    
    117,401
    
    
    86,424**Cash
      and cash equivalents at end of period**
    
    $
    178,108
    
    $
    10,217
    
    $
    117,401**See
      independent auditor's report and accompanying notes to the consolidated
      financial statements.**
 
 33
 
 **VALUE
      LINE, INC.****STATEMENT
      OF CHANGES IN STOCKHOLDERS' EQUITY****FOR
      THE THREE YEARS ENDED APRIL 30, 2004, 2003 AND
    2002****(in
      thousands, except share amounts)**

**Number**
    
    **Par
      value**
    
    Additional
    
    
    
    
    
    
    
    **Accumulatedother****of
      common**
    
    **of
      common**
    
    **paid-in**
    
    **Treasury**
    
    **Comprehensive**
    
    **Retained**
    
    **comprehensive****shares**
    
    **shares**
    
    **capital**
    
    **Stock**
    
    **income**
    
    **earnings**
    
    **income**
    
    **Total****Balance
      at April 30, 2001**
    
    
    9,978,925
    
    $
    1,000
    
    $
    963
    
    
    ($406
    )
    
    
    
    $
    163,416
    
    $
    35,233
    
    $
    200,206Comprehensive
      incomeNet
      income
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    20,323
    
    
    20,323
    
    
    
    
    
    20,323Other
      comprehensive income,net of tax:Change
      in unrealizedgains on securities
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (14,580
    )
    
    
    
    
    (14,580
    )
    
    (14,580
    )Comprehensive
      income
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    5,743Exercise
      of stock options
    
    
    1,200
    
    
    
    
    
    12
    
    
    23
    
    
    
    
    
    
    
    
    
    
    
    35Dividends
      declared
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (9,979
    )
    
    
    
    
    (9,979
    )**Balance
      at April 30, 2002**
    
    
    9,980,125
    
    $
    1,000
    
    $
    975
    
    
    ($383
    )
    
    
    
    $
    173,760
    
    $
    20,653
    
    $
    196,005Comprehensive
      incomeNet
      income
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    19,987
    
    
    19,987
    
    
    
    
    
    19,987Other
      comprehensive income,net of tax:Change
      in unrealizedgains on securities
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (10,680
    )
    
    
    
    
    (10,680
    )
    
    (10,680
    )Comprehensive
      income
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    9,307Exercise
      of stock options
    
    
    1,475
    
    
    
    
    
    16
    
    
    29
    
    
    
    
    
    
    
    
    
    
    
    45Dividends
      declared
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (9,979
    )
    
    
    
    
    (9,979
    )**Balance
      at April 30, 2003**
    
    
    9,981,600
    
    $
    1,000
    
    $
    991
    
    
    ($354
    )
    
    
    
    $
    183,768
    
    $
    9,973
    
    $
    195,378Comprehensive
      incomeNet
      income
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    20,350
    
    
    20,350
    
    
    
    
    
    20,350Other
      comprehensive income,net of tax:Change
      in unrealized gains on securities
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    4,229
    
    
    
    
    
    4,229
    
    
    4,229Comprehensive
      income
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    24,579Dividends
      declared
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (184,659
    )
    
    
    
    
    (184,659
    )**Balance
      at April 30, 2004**
    
    $
    9,981,600
    
    $
    1,000
    
    $
    991
    
    
    ($354
    )
    
    
    
    $
    19,459
    
    $
    14,202
    
    $
    35,298

**See
      independent auditor's report and accompanying notes to the consolidated
      financial statements.**
 
 34
 
 **Value
Line, Inc.**
 **Notes
to Consolidated Financial Statements**
 
 **Note
1 - Organization and Summary of Significant Accounting
Policies:**
 
 Value
Line, Inc. (the "Company") is incorporated in New York State and carries on the
investment periodicals and related publications and investment management
activities formerly performed by Arnold Bernhard & Co., Inc. (the "Parent")
which owns approximately 86% of the issued and outstanding common stock of the
Company.
 
 Principles
of consolidation: The consolidated financial statements include the accounts of
the Company and all of its subsidiaries. All significant intercompany accounts
and transactions have been eliminated in consolidation.
 
 Revenue
recognition: Subscription revenues are recognized ratably over the terms of the
subscriptions. Accordingly, the amount of subscription fees to be earned by
servicing subscriptions after the date of the balance sheet is shown as unearned
revenue. The unearned revenue shown on the balance sheet is a noncurrent
deferred credit. This classification recognizes that the fulfillment of this
commitment will require the use of significantly fewer current assets than the
amount of the unearned revenues and, accordingly, combining it with current
liabilities would significantly understate the
liquidity position of the Company.
 
 Investment
management fees are recorded as revenue as the related services are
performed.
 
 Valuation
of Securities:
 
 The
Company's long-term securities available for sale portfolio, which consists of
shares of the Value Line Mutual Funds and government debt securities, is
accounted for in accordance with Statement of Financial Accounting Standards
No.115, "Accounting for Certain Investments in Debt and Equity Securities".The
securities are valued at market with unrealized gains and losses on these
securities reported, net of applicable taxes, as a separate component of
Shareholders' Equity. Realized gains and losses on sales of the long term
securities are recorded in earnings on trade date and are determined on the
identified cost method.
 
 Trading
securities held by the Company are valued at market with unrealized gains and
losses included in earnings.
 
 Market
valuation of securities listed on a securities exchange and over-the-counter
securities traded on the NASDAQ national market is based on the closings sales
prices on the last business day of each month. In the absence of closing sales
prices for such securities, and for other securities traded in the
over-the-counter market, the security is valued at the midpoint between the
latest available and representative asked and bid prices.
 
 Valuation
of open-ended mutual fund shares are based upon the daily net asset values of
the shares as calculated by such funds.
 
 The
market value of the Company's fixed maturity government debt obligations are
valued utilizing quoted prices at the end of each day provided by an outside
pricing service.
  Advertising
expenses: The Company expenses advertising costs as incurred.
 
 35
 
 **Value
Line, Inc.**
 **Notes
to Consolidated Financial Statements**
 
 Income
Taxes:
 
 The
Company computes its income tax provision in accordance with the provisions of
Statement of Financial Accounting Standards No. 109, "Accounting for Income
Taxes". Deferred tax liabilities and assets are recognized for the expected
future tax consequences of events that have been reflected in the Consolidated
Financial Statements. Deferred tax liabilities and assets are determined based
on the differences between the book values and the tax bases of particular
assets and liabilities, using tax rates currently in effect for the years in
which the differences are expected to reverse.
 
 Earnings
per share: Earnings per share are based on the weighted average number of shares
of common stock and common stock equivalents outstanding during each
year.
 
 Cash and
Cash Equivalents: For purposes of the Consolidated Statements of Cash Flows, the
Company considers all cash held at banks and short term liquid investments with
an original maturity of less than three months to be cash and cash equivalents.
As of April 30, 2004 and 2003, cash equivalents included $122,319,000 and
$4,979,000, respectively, invested in the Value Line money market
funds.
 
 Use of
Estimates: The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect certain reported amounts and disclosures. Accordingly,
actual results could differ from those estimates.
 
 **Note
2 - Supplementary Cash Flow Information:**
 
 Cash
payments for income taxes were $12,755,000, $11,480,000, and $14,034,000 in
fiscal 2004, 2003, and 2002, respectively. Interest payments of $18,000,
$49,000, and $6,000, were made in fiscal 2004, 2003, and 2002,
respectively.
 
 **Note
3 - Related Party Transactions:**
 
 The
Company acts as investment adviser and manager for fourteen open-ended
investment companies, the Value Line Family of Funds (see Note 4). The Company
earns investment management fees based upon the average daily net asset values
of the respective funds. Effective July 1, 2000, the Company received service
and distribution fees under rule 12b-1 of the Investment Company Act of 1940
from twelve of the fourteen mutual funds for which Value Line is the adviser.
Effective September 18, 2002, the Company began receiving service and
distribution fees under rule 12b-1 from the remaining two funds, for which Value
Line, Inc. is the adviser. The Company also earns brokerage commission income,
net of clearing fees, on securities transactions executed by Value Line
Securities, Inc. on behalf of the funds that are cleared on a fully disclosed
basis through non-affiliated brokers. For the years ended April 30, 2004, 2003,
and 2002, investment management fees, service and distribution fees and
brokerage commission income, net of clearing fees, amounted to $30,851,000,
$28,022,000, and $32,296,000, respectively. These amounts include service and
distribution fees of $9,638,000, $7,968,000, and $6,269,000, respectively. The
related receivables from the funds for management advisory fees and service and
distribution fees included in Receivable from affiliates were $2,448,000, and
$2,249,000, at April 30, 2004 and 2003, respectively.
 
 For the
years ended April 30, 2004, 2003, and 2002, the Company was reimbursed $489,000,
$527,000 and $539,000, respectively, for payments it made on behalf of and
services it provided to the Parent. At April 30, 2004 and 2003, receivable from
affiliates included a receivable from the Parent of $70,000 and $45,000,
respectively. For the years ended April 30, 2004, 2003, and 2002, the Company
made federal income tax payments to the Parent amounting to $10,650,000,
$9,500,000 and $11,498,000, respectively. At April 30, 2004 and 2003, accrued
taxes payable included a federal tax liability owed to the Parent in the amount
of $390,000 and $425,000, respectively. These data are in accordance with the
tax sharing arrangement described in Note 6.
 
 36
 **Value
Line, Inc.**
 **Notes
to Consolidated Financial Statements**
 **Note
4 - Investments:**
 
 **Trading
Securities:**
 
 Securities
held by the Company had an aggregate cost of $18,854,000 and a market value of
$19,981,000 at April 30, 2004, and an aggregate cost of $2,908,000 and a market
value of $3,093,000 at April 30, 2003. Net realized trading gains amounted to
$2,084,000 during the year ended April 30, 2004. Net realized trading losses
amounted to $969,000 during the year ended April 30, 2003. Net realized trading
losses amounted to $5,355,000 during fiscal 2002.
 
 The net
changes in unrealized gains for the periods ended April 30, 2004, 2003 and 2002
of $942,000, $75,000 and $258,000, respectively, are included in the
Consolidated Statement of Income.
 
 **Long-Term
Securities Available for Sale:**
 
 The
aggregate cost of the long-term securities, which are primarily invested in the
Value Line mutual funds, was $24,502,000 and the market value was $46,353,000 at
April 30, 2004. The aggregate cost of the long-term securities at April 30, 2003
was $31,366,000 and the market value was $45,150,000. The total gains for equity
securities with net gains included in Accumulated Other Comprehensive Income on
the Consolidated Balance Sheet are $21,850,000 and $13,784,000, net of deferred
taxes of $7,648,000 and $4,824,000 as of April 30, 2004 and 2003, respectively.
There are no losses on equity securities included in Accumulated Other
Comprehensive Income for the fiscal years ended April 30, 2004 and 2003,
respectively. The increase in gross unrealized gains on these securities of
$8,066,000 and the decrease of $17,987,000, net of deferred taxes of $2,823,000
and $6,295,000 were included in shareholders' equity at April 30,
2004 and 2003, respectively.
 
 Realized
capital gains from the sales of long-term securities available for sale were
$1,441,000, $2,609,000 and $8,633,000 of which $1,413,000, $1,997,000 and
$6,357,000 of capital gains were reclassified out of Accumulated Other
Comprehensive Income into earnings during fiscal years ended April 30, 2004,
2003, and 2002, respectively. The proceeds received from the sales of these
securities during the fiscal years ended April 30, 2004, 2003, and 2002 were
$9,751,000, $39,598,000 and $56,102,000, respectively.
 
 **Government
Debt Securities:**
 
 The
Company's investments in debt securities are available for sale and valued at
market value. The aggregate cost and fair value at April 30, 2004 for U.S.
government debt securities classified as available for sale were as
follows:
 
 (In
      Thousands)Historical
    
    
    
    Gross
      UnrealizedMaturity
    
    Cost
    
    Fair
      Value
    
    Holding
      GainsDue
      in 1-2 years
    
    $
    1
    
    $
    1
    
    $
    0Total
      investment in debt securities
    
    $
    1
    
    $
    1
    
    $
    0
 
 The
aggregate cost and fair value at April 30, 2003 for U.S. government debt
securities classified as available for sale were as follows:
 
 (In
      Thousands)Historical
    
    
    
    Gross
      UnrealizedMaturity
    
    Cost
    
    Fair
      Value
    
    Holding
      GainsDue
      in 1-2 years
    
    $
    104,401
    
    $
    104,718
    
    $
    317Due
      in 2-5 years
    
    
    64,953
    
    
    66,195
    
    
    1,242Total
      investment in debt securities
    
    $
    169,354
    
    $
    170,913
    
    $
    1,559
 
 
 37
 **Value
Line, Inc.**
 **Notes
to Consolidated Financial Statements**
 There are
no gains or losses on U.S. government debt securities included in Accumulated
Other Comprehensive Income on the Consolidated Balance Sheets as of April 30,
2004 and no losses included for 2003, respectively. The total gains for U.S.
government debt securities included in Accumulated Other Comprehensive Income
are $1,559,000, net of deferred taxes of $546,000, as of April 30,
2003.
 
 The
average yield on the U.S. Government debt securities classified as available for
sale at April 30, 2004 and April 30, 2003 was 2.59% and 3.36%,
respectively.
 
 Proceeds
from sales of long-term fixed income securities available for sale during fiscal
2004 were $230,210,000 and the related loss on sales, which were reclassified
from Accumulated Other Comprehensive Income in the Balance Sheet was $354,000.
Proceeds from sales of long-term fixed income securities available for sale
during fiscal 2003 were $57,471,000 and the related gain on sales, which were
reclassified from Accumulated Other Comprehensive Income on the Balance Sheet
was $602,000. There were no sales of long-term fixed income securities during
fiscal year 2002.
 
 During
the year ended April 30, 2003, the Company transferred investments in debt
securities from held-to-maturity classification to available for sale
classification. The amortized cost of the securities transferred was
$112,154,000 and the unrealized gain on the securities was $1,555,000. The
circumstances leading to the decision to transfer the securities were primarily
the result of the changing market conditions increasing the possibility that the
Company may sell the securities prior to their maturity.
 
 For the
years ended April 30, 2004, 2003, and 2002, income from securities transactions
also included $247,000, $832,000,and $2,487,000, of dividend income; $4,012,000,
$3,529,000, and $343,000, of interest income; and $18,000, $49,000 and $6,000,
of related interest expense, respectively.
 
 **Note
5 - Property and Equipment:**
 
 Property
and equipment are carried at cost. Depreciation and amortization are provided
using the straight-line method over the estimated useful lives of the assets, or
in the case of leasehold improvements, over the remaining terms of the leases.
For income tax purposes, depreciation of furniture and equipment is computed
using accelerated methods and buildings and leasehold improvements are
depreciated over prescribed, extended tax lives.
 
 Property
and equipment consist of the following:
 
 April
      30,2004
    
    2003(in
      thousands)Land
    
    $
    726
    
    $
    726Building
      and leasehold improvements
    
    
    7,834
    
    
    7,834Furniture
      and equipment
    
    
    10,569
    
    
    10,58519,129
    
    
    19,145Accumulated
      depreciation and amortization
    
    
    (12,584
    )
    
    (11,752
    )$
    6,545
    
    $
    7,393
 
 38
 ****Value
Line, Inc.**
**Notes
to Consolidated Financial Statements****
 **Note
6 - Federal, State and Local Income Taxes:**
 
 The
Company computes its income tax provision in accordance with the provisions of
Statement of Financial Accounting Standards No. 109, "Accounting for Income
Taxes".
 
 The
provision for income taxes includes the following:
 
 
 Years
      ended April 30,2004
    
    2003
    
    2002Current:
    
    (in
      thousands)Federal
    
    $
    10,453
    
    $
    10,383
    
    $
    11,232State
      and local
    
    
    2056
    
    
    2,041
    
    
    2,50212,509
    
    
    12,424
    
    
    13,734Deferred:Federal
    
    
    134
    
    
    (1,704
    )
    
    960State
      and local
    
    
    12
    
    
    14
    
    
    (3
    )146
    
    
    (1,690
    )
    
    957Provision
      for income taxes
    
    $
    12,655
    
    $
    10,734
    
    $
    14,691
  
 Deferred
taxes are provided for temporary differences between the financial reporting
basis and the tax basis of the Company's assets and liabilities. The tax effect
of temporary differences giving rise to the Company's deferred tax
(liability)/asset are as follows:
 
 Years
      ended April 30,2004
    
    2003
    
    2002(in
      thousands)Unrealized
      gains on securities held for sale
    
    
    ($7,648
    )
    
    ($5,370
    )
    
    ($11,121
    )Unrealized
      gains on trading securities
    
    
    (395
    )
    
    (65
    )
    
    (40
    )Depreciation
      and amortization
    
    
    (101
    )
    
    (294
    )
    
    (575
    )Deferred
      professional fees
    
    
    348
    
    
    340
    
    
    370Deferred
      charges
    
    
    151
    
    
    308
    
    
    451Other,
      net
    
    
    65
    
    
    (127
    )
    
    (1735
    )($7,580
    )
    
    ($5,208
    )
    
    ($12,650
    )
 
 Included
in deferred income taxes in total current assets are deferred state and local
income taxes of $104,000 and $48,000 at April 30, 2004 and 2003, respectively.
Accrued taxes payable at April 30, 2003, included a deferred federal tax
liability of $99,000.
 
 39
 ****

**Value
Line, Inc.**
**Notes
to Consolidated Financial Statements**
 
 The
provision for income taxes differs from the amount of income tax determined by
applying the applicable U.S. statutory income tax rate to pretax income as a
result of the following:
 
 Years
      ended April 30,2004
    
    2003
    
    2002(in
      thousands)Tax
      expense at the U.S. statutory rate
    
    $
    11,552
    
    $
    10,752
    
    $
    12,255Increase
      (decrease) in tax expense from:State
      and local income taxes, net of federal income tax benefit
    
    
    1,344
    
    
    1,336
    
    
    1,629Effect
      of tax exempt income and dividend deductions
    
    
    (278
    )
    
    (95
    )
    
    (28
    )Other,
      net
    
    
    37
    
    
    (1,259
    )
    
    835Provision
      for income taxes
    
    $
    12,655
    
    $
    10,734
    
    $
    14,691
 
 The
provision for income taxes has been reduced by approximately $1,257,000 for the
fiscal year ended April 30, 2003, primarily resulting from the favorable
disposition of a pending tax audit, which was concluded during the
year.
 
 The
Company is included in the consolidated federal income tax return of the Parent.
The Company has a tax sharing arrangement which requires it to make tax payments
to the Parent equal to the Company's liability as if it filed a separate
return.
 
 **Note
7 - Employees' Profit Sharing and Savings Plan:**
 
 Substantially
all employees of the Company and its subsidiaries are members of the Value Line,
Inc. Profit Sharing and Savings Plan (the "Plan"). In general, this is a
qualified, contributory plan which provides for a discretionary annual Company
contribution which is determined by a formula based upon the salaries of
eligible employees and the amount of consolidated net operating income as
defined in the Plan. Plan expense, included in salaries and employee benefits in
the Consolidated Statements of Income and Retained Earnings, for the years ended
April 30, 2004, 2003, and 2002 was $1,217,000, $862,000, and $1,171,000,
respectively.
 
 40
 ******
**Value
Line, Inc.**
**Notes
to Consolidated Financial Statements****
 ****
 **Note
8 - Incentive Stock Options:**
 
 On April
17, 1993, the Incentive Stock Option Plan expired. On the date of expiration,
22,550 options available for grant were cancelled. Information on the 1983
Incentive Stock Option Plan for the three years ended April 30, 2004, is as
follows:
  Number
      of
    
    OptionShares
    
    PricesOutstanding
      at April 30, 2001
    
    
    2,675
    
    $
    29.75Granted
    
    
    --Exercised
    
    
    (1,200
    )
    $
    29.75Cancelled
    
    
    --Outstanding
      at April 30, 2002
    
    
    1,475
    
    $
    29.75Granted
    
    
    --Exercised
    
    
    (1,475
    )
    $
    29.75Cancelled
    
    
    --Outstanding
      at April 30, 2003
    
    
    --
    
    
    --Granted
    
    
    --Exercised
    
    
    --
    
    
    --Cancelled
    
    
    --
    
    
    --Outstanding
      at April 30, 2004
    
    
    --
    
    
    --
 
 At April
30, 2004, all of the options under the option plan were exercised. Of the common
stock held in treasury at April 30, 2002, 1,475 shares were issued during fiscal
2003 for the exercise of stock options.
 
 **Note
9 - Treasury Stock:**
 
 Treasury
stock, at cost, for the three years ended April 30, 2004, consists of the
following:
 
 Shares
    
    Amount(in
      thousands)Balance
      April 30, 2001
    
    
    21,075
    
    $
    406Exercise
      of incentive stock options
    
    
    (1,200
    )
    
    (23
    )Balance
      April 30, 2002
    
    
    19,875
    
    $
    383Exercise
      of incentive stock options
    
    
    (1,475
    )
    
    (29
    )Balance
      April 30, 2003
    
    
    18,400
    
    $
    354Exercise
      of incentive stock options
    
    
    --
    
    
    --Balance
      April 30, 2004
    
    
    18,400
    
    $
    354
 
 41
 ****
 ****Value
Line, Inc.**
**Notes
to Consolidated Financial Statements****
 ****
 **Note
10 - Lease Commitments:**
 
 On June
4, 1993, the Company entered into a 15 year lease agreement to provide primary
office space. The lease includes free rental periods as well as scheduled base
rent escalations over the term of the lease. The total amount of the base rent
payments is being charged to expense on the straight-line method over the term
of the lease. The Company has recorded a deferred charge on its Consolidated
Balance Sheets to reflect the excess of annual rental expense over cash payments
since inception of the lease. On September 14, 2000, the Company amended its
lease for primary office space and returned to the landlord approximately 6,000
square feet of excess office capacity, reducing the Company's future minimum
lease payments, accordingly.
 
 Future
minimum payments, exclusive of forecasted increases in real estate taxes and
wage escalations, under operating leases for office space, with remaining terms
of one year or more, are as follows:
  Year
      ended April 30:
    
    (in
      thousands)2005
    
    
    1,7882006
    
    
    1,7882007
    
    
    1,7882008
    
    
    1,148Thereafter
    
    
    21$
    6,533
 
 Rental
expense for the years ended April 30, 2004, 2003 and 2002 under operating leases
covering office space was $1,544,000, $1,350,000, and $1,373,000,
respectively.
 
 42
 **Value
Line, Inc.**
**Notes
to Consolidated Financial Statements**
****
 **Note
11 - Business Segments:**
 
 The
Company operates two reportable business segments: Publishing and Investment
Management Services. The publishing segment produces investment related
periodicals in both print and electronic form. The investment management segment
provides advisory services to mutual funds, institutional and individual clients
as well as brokerage services for the Value Line family of mutual funds. The
segments are differentiated by the products and services they
offer.
 
 The
accounting policies of the segments are the same as those described in the
summary of significant accounting policies. The Company allocates all revenues
and expenses, except for depreciation related to corporate assets, between the
two reportable segments.
 
 Disclosure
of Reportable Segment Profit and Segment Assets (in thousands)
 
 **April
      30, 2004**InvestmentManagementPublishing
    
    Services
    
    TotalRevenues
      from external customers
    
    $
    52,497
    
    $
    32,206
    
    $
    84,703Intersegment
      revenues
    
    
    193
    
    
    --
    
    
    193Income
      from securities transactions
    
    
    4
    
    
    8,262
    
    
    8,266Depreciation
      and amortization
    
    
    2,632
    
    
    62
    
    
    2,694Segment
      profit
    
    
    14,391
    
    
    10,380
    
    
    24,771Segment
      assets
    
    
    14,592
    
    
    74,786
    
    
    89,378Expenditures
      for segment assets
    
    
    2,128
    
    
    45
    
    
    2,173
 
 
 **April
      30, 2003**InvestmentManagementPublishing
    
    Services
    
    TotalRevenues
      from external customers
    
    $
    52,469
    
    $
    29,600
    
    $
    82,069Intersegment
      revenues
    
    
    180
    
    
    --
    
    
    180Income
      from securities transactions
    
    
    38
    
    
    6,588
    
    
    6,626Depreciation
      and amortization
    
    
    3,080
    
    
    156
    
    
    3,236Segment
      profit
    
    
    13,660
    
    
    10,473
    
    
    24,133Segment
      assets
    
    
    18,648
    
    
    227,786
    
    
    246,434Expenditures
      for segment assets
    
    
    1,571
    
    
    37
    
    
    1,608
 
 
 43
 **Value
      Line, Inc.**
      **Notes
      to Consolidated Financial Statements**
      ****
      Reconciliation
      of Reportable Segment Revenues,Operating
      Profit and Assets(in
      thousands)
 
 2004
    
    2003**Revenues**Total
      revenues for reportable segments
    
    $
    84,896
    
    $
    82,249Elimination
      of intersegment revenues
    
    
    (193
    )
    
    (180
    )Total
      consolidated revenues
    
    $
    84,703
    
    $
    82,069**Segment
      profit**Total
      profit for reportable segments
    
    $
    33,037
    
    $
    30,759Less:
      Depreciation related to corporate assets
    
    
    (32
    )
    
    (38
    )Income
      before income taxes
    
    $
    33,005
    
    $
    30,721**Assets**Total
      assets for reportable segments
    
    $
    89,378
    
    $
    246,434Corporate
      assets
    
    
    177,546
    
    
    380Consolidated
      total assets
    
    $
    266,924
    
    $
    246,814
 
 
 **Note
12 - Net Capital:**
 
 The
Company's wholly owned subsidiary, Value Line Securities, Inc. is subject to the
net capital provisions of Rule 15c3-1 under the Securities Exchange Act of 1934,
which requires the maintenance of minimum net capital of $100,000 or
one-fifteenth of aggregate indebtedness, if larger. Additionally, dividends may
only be declared if aggregate indebtedness is less than twelve times net
capital.
 
 At April
30, 2004, the net capital, as defined of Value Line Securities, Inc. of
$16,464,000 exceeded required net capital by $16,364,000 and the ratio of
aggregate indebtedness to net capital was .06 to 1.
 ****
 **Note
13 - Disclosure of Credit Risk of Financial Instruments with Off Balance Sheet
Risk:**
 
 In the
normal course of business, the Company enters into contractual commitments,
principally financial futures contracts for securities indices. Financial
futures contracts provide for the delayed delivery of financial instruments for
which the seller agrees to make delivery at a specified future date, at a
specified price or yield. The contract or notional amount of these contracts
reflects the extent of involvement the Company has in these contracts. At April
30, 2004 and 2003, the Company did not have any investment in financial futures
contracts. The Company limits its credit risk associated with such instruments
by entering into exchange traded future contracts.
 
 The
Company executes, as agent, securities transactions on behalf of the Value Line
mutual funds. If either the mutual fund or a counter party fail to perform, the
Company may be required to discharge the obligations of the nonperforming party.
In such circumstances, the Company may sustain a loss if the market value of the
security is different from the contract value of the transaction.
 
 No single
customer accounted for a significant portion of the Company's sales in 2004,
2003 or 2002, nor accounts receivable for 2004 or 2003.
 
 44
 ****
 ****Value
Line, Inc.**
**Notes
to Consolidated Financial Statements****
 ****
 **Note
14 - Comprehensive Income:**
 
 During
the fiscal year 1999, the Company adopted FASB statement no. 130, Reporting
Comprehensive Income. Statement no. 130 requires the reporting of comprehensive
income in addition to net income from operations. Comprehensive income is a more
inclusive financial reporting methodology that includes disclosure of certain
financial information that historically has not been recognized in the
calculation of net income.
 
 At April
30, 2004, 2003, and 2002, the Company held both equity securities and U.S.
Government debt securities that are classified as Long Term Securities Available
for Sale on the Consolidated Balance Sheets. The change in valuation of these
securities, net of deferred taxes has been recorded in Accumulated Other
Comprehensive Income in the Company's Balance Sheets.
 
 The gross
change in other comprehensive income during fiscal 2004 that resulted from an
increase in unrealized gains and the deferred taxes on the change in value of
equity securities classified as available for sale were $8,066,000 and
$2,823,000, respectively. The gross change in other comprehensive income during
fiscal 2003 and 2002 that resulted from a decrease in unrealized gains and
deferred taxes on the change in value of equity securities classified as
available for sale were $17,987,000 and $22,431,000 and $6,295,000 and
$7,851,000, respectively.
 
 The gross
change in other comprehensive income during fiscal 2004 that resulted from a
decrease in unrealized gains and the deferred taxes on the change in value of
U.S. Government debt securities classified as available for sale were $1,559,000
and $545,000, respectively. The gross change in other comprehensive income
during fiscal 2003 that resulted from an increase in unrealized gains and a
reclassification of the U.S. Government Debt securities from the classification,
held-to-maturity to available for sale and the deferred taxes on the change in
value of U.S. Government debt securities were $1,559,000, and $545,000,
respectively. The U.S. Government debt securities were reclassified as available
for sale during fiscal 2003 from the classification of held-to-maturity during
fiscal year 2002 with $1,555,000 of unrealized gains included in 2003's gross
change in other comprehensive income.
 
 **Note
15 - Accounting for the Costs of Computer Software Developed for Internal
Use:**
 
 During
fiscal year 1999, the Company adopted the provisions of the Statement of
Position 98-1, (SOP 98-1), "Accounting for the Costs of Computer Software
Developed for Internal Use". SOP 98-1 is effective for tax years ending after
December 31, 1998.
 
 The SOP
98-1 requires companies to capitalize as long-lived assets many of the costs
associated with developing or obtaining software for internal use and amortize
those costs over the software's estimated useful life in a systematic and
rational manner.
 
 At April
30, 2004 and 2003 the Company capitalized $1,123,000 and $868,000 of costs
related to the development of software for internal use. Such costs are
capitalized and amortized over the expected useful life of the asset which is
approximately 3 years. Amortization expense for the years ended April 30, 2004,
2003 and 2002 was $889,000, $1,062,000, and $917,000, respectively.
 
 **Note
16 - Contingencies**
 
 The
Company commenced an action in New York Supreme Court against a small mutual
fund company pertaining to a contemplated transaction. The Company is seeking
damages in an unspecified amount. The Company was countersued for alleged
damages in excess of $5,000,000. A related entity of the defendant in the New
York action brought suit against the Company and certain Directors in Federal
Court in Texas based on the same transaction. Although the ultimate outcome of
the litigation is subject to the inherent uncertainties of any legal
proceedings, based upon Counsel's analysis of the factual and legal issues and
the Company's meritorious defenses, it is management's belief that the expected
outcome of this matter will not have a material adverse effect on the Company's
consolidated results of operations and financial condition.
 45
 
 **VALUE
      LINE, INC.****SCHEDULE
      1-MARKETABLE SECURITIES****As
      of APRIL 30, 2004**
  **Common
      Stock Name**
    
    **Number
      of Shares**
    
    **Cost**
    
    **Market****1
      800 FLOWERS.COM**
    
    
    **37,242**
    
    
    **344,282.56**
    
    
    **371,675.16****ACCREDO
      HEALTH INC**
    
    
    **10,639**
    
    
    **411,939.57**
    
    
    **411,303.74****AETNA
      INC.**
    
    
    **376**
    
    
    **33,042.84**
    
    
    **31,020.00****AGILENT
      TECHNOLOGIES**
    
    
    **12,587**
    
    
    **434,052.79**
    
    
    **339,974.87****AMERICAN
      FINANCIAL GROUP INC**
    
    
    **4,383**
    
    
    **130,776.99**
    
    
    **134,558.10****AMERICAN
      INTERNATIONAL GROUP INC**
    
    
    **5,299**
    
    
    **393,269.91**
    
    
    **379,673.35****AMERITRADE
      HOLDINGS CORP.**
    
    
    **25,768**
    
    
    **273,435.88**
    
    
    **315,915.68****ANDREW
      CORP**
    
    
    **2,010**
    
    
    **40,702.50**
    
    
    **34,129.80****APOLLO
      GROUP INC**
    
    
    **390**
    
    
    **33,796.80**
    
    
    **35,490.00****ARCHER
      DANIELS MIDLAND CO**
    
    
    **23,724**
    
    
    **408,996.22**
    
    
    **416,593.44****ARMOR
      HOLDINGS INC**
    
    
    **11,829**
    
    
    **346,300.94**
    
    
    **390,830.16****ARROW
      ELECTRONICS INC**
    
    
    **4,927**
    
    
    **124,935.91**
    
    
    **124,554.56****AUTODESK
      INC.**
    
    
    **854**
    
    
    **29,061.62**
    
    
    **28,617.54****BARD
      C R INC**
    
    
    **326**
    
    
    **34,967.94**
    
    
    **34,644.02****BIOGEN
      IDEC INC**
    
    
    **7,396**
    
    
    **392,658.60**
    
    
    **436,364.00****BMC
      SOFTWARE INC**
    
    
    **1,963**
    
    
    **36,925.99**
    
    
    **33,959.90****CAREER
      EDUCATION CORP.**
    
    
    **538**
    
    
    **34,585.28**
    
    
    **34,421.24****CEPHLON
      INC**
    
    
    **594**
    
    
    **33994.62**
    
    
    **33,804.54****CERNER
      CORP**
    
    
    **744**
    
    
    **32788.08**
    
    
    **31,858.08****CHARLES
      RIVER LABS INTL INC**
    
    
    **794**
    
    
    **33,586.28**
    
    
    **36,524.00****CHATTEM
      INC.**
    
    
    **1,035**
    
    
    **29,034.75**
    
    
    **28,038.15****CHICOS
      FAS INC**
    
    
    **9,041**
    
    
    **315,067.91**
    
    
    **368,239.93****COACH
      INC.**
    
    
    **814**
    
    
    **34,881.77**
    
    
    **34,676.40****COMMERCE
      BANCORP INC**
    
    
    **694**
    
    
    **40,128.76**
    
    
    **39,564.94****COPART
      INC**
    
    
    **18,335**
    
    
    **382,512.10**
    
    
    **347,448.25****CVS
      CORP.**
    
    
    **11,097**
    
    
    **407,512.88**
    
    
    **428,677.11****DAVITA
      INC.**
    
    
    **1,026**
    
    
    **35,644.60**
    
    
    **52,428.60****D
      R HORTON INC.**
    
    
    **11,931**
    
    
    **330,723.03**
    
    
    **343,612.80****DST
      SYSTEMS INC**
    
    
    **929**
    
    
    **41,182.57**
    
    
    **41,015.35****ENESCO
      GROUP**
    
    
    **2,370**
    
    
    **34,388.70**
    
    
    **30,738.90****ERESEARCHTECHNOLOGY
      INC**
    
    
    **13,779**
    
    
    **437,798.47**
    
    
    **433,762.92****ERICSSON
      LM TEL CO**
    
    
    **1,445**
    
    
    **40,295.27**
    
    
    **38,538.15****ETRADE
      GROUP INC.**
    
    
    **31,050**
    
    
    **433,124.16**
    
    
    **352,728.00****FAIRCHILD
      SEMICONDUCTOR**
    
    
    **1,501**
    
    
    **40,219.98**
    
    
    **29,224.47****FISHER
      SCIENTIFIC INTL INC**
    
    
    **550**
    
    
    **29,524.00**
    
    
    **32,202.50****FLIR
      SYS INC**
    
    
    **745**
    
    
    **34,903.25**
    
    
    **34,895.80****FOOT
      LOCKER INC**
    
    
    **15,784**
    
    
    **339,898.68**
    
    
    **378,816.00****FORTUNE
      BRANDS INC**
    
    
    **456**
    
    
    **34,944.60**
    
    
    **34,770.00****GENENTECH,
      INC.**
    
    
    **3,779**
    
    
    **239,565.39**
    
    
    **464,061.20****GEORGIA
      PAC CORP**
    
    
    **10,717**
    
    
    **403,671.88**
    
    
    **376,166.70****GETTY
      IMAGES INC.**
    
    
    **661**
    
    
    **35,026.39**
    
    
    **36,090.60****GUESS
      INC.**
    
    
    **22,978**
    
    
    **370,997.37**
    
    
    **357,767.46****HARMAN
      INTL INDS INC.**
    
    
    **5,014**
    
    
    **322,640.42**
    
    
    **380,311.90****HEADWATERS
      INC**
    
    
    **5,478**
    
    
    **127,565.30**
    
    
    **125,172.30****HELEN
      OF TROY CORP LTD.**
    
    
    **1,368**
    
    
    **39,388.23**
    
    
    **45,444.96****HOME
      DEPOT INC.**
    
    
    **11,088**
    
    
    **383,569.44**
    
    
    **390,186.72****IDX
      SYSTEMS**
    
    
    **11,622**
    
    
    **222,350.93**
    
    
    **368,417.40****IDEXX
      LABS INC**
    
    
    **597**
    
    
    **33,649.85**
    
    
    **36,572.22****INCO
      LTD**
    
    
    **10,617**
    
    
    **395,144.30**
    
    
    **305,238.75****INGRAM
      MICRO INC**
    
    
    **1,550**
    
    
    **29,233.00**
    
    
    **18,522.50****INTERNATIONAL
      GAME TECH.**
    
    
    **9,036**
    
    
    **339,011.72**
    
    
    **341,018.64**
   46
 **Common
      Stock Name**
    
    **Number
      of Shares**
    
    **Cost**
    
    **Market**
 **INVITROGEN
      CORP.**
    
    
    **5,465**
    
    
    **335,012.70**
    
    
    **395,447.40****KORN
      FERRY INTERNATIONAL**
    
    
    **2,250**
    
    
    **33,725.03**
    
    
    **33,705.00****L-3
      COMMUNICATIONS HOLDINGS**
    
    
    **588**
    
    
    **34,133.40**
    
    
    **36,303.12****LABORATORY
      CORP OF AMERICA HOLDINGS**
    
    
    **997**
    
    
    **40,900.08**
    
    
    **39,620.78****LANDRY'S
      RESTAURANTS INC**
    
    
    **4,176**
    
    
    **132,232.69**
    
    
    **139,812.48****MANDALAY
      RESORT GROUP**
    
    
    **5,543**
    
    
    **337,993.58**
    
    
    **318,445.35****MARVEL
      TECHNOLOGY GROUP**
    
    
    **8,803**
    
    
    **340,356.70**
    
    
    **342,612.76****MOTOROLA
      INC**
    
    
    **7,175**
    
    
    **129,209.70**
    
    
    **130,943.75****NAVIGANT
      CONSULTING NC.**
    
    
    **19,839**
    
    
    **298,668.48**
    
    
    **347,777.67****NBTY
      INC**
    
    
    **1,100**
    
    
    **37,730.00**
    
    
    **40,876.00****NEXTEL
      COMMUNICATIONS INC.**
    
    
    **16,104**
    
    
    **318,034.31**
    
    
    **384,080.40****NORFOLK
      SOUTHERN CORP**
    
    
    **18,235**
    
    
    **405,906.07**
    
    
    **434,357.70****NU
      SKIN ENTERPRISES INC**
    
    
    **17,518**
    
    
    **308,978.82**
    
    
    **414,651.06****OPEN
      TEXT CORP**
    
    
    **12,774**
    
    
    **377,277.37**
    
    
    **347,069.58****PATINA
      OIL & GAS CORP**
    
    
    **1,734**
    
    
    **40,137.21**
    
    
    **48,205.20****PEPSIAMERICAS
      INC**
    
    
    **1,675**
    
    
    **33,088.29**
    
    
    **33,550.25****PFIZER
      INC**
    
    
    **1,102**
    
    
    **40,234.02**
    
    
    **39,407.52****PHELPS
      DODGE CORP**
    
    
    **4,969**
    
    
    **386,491.49**
    
    
    **327,109.27****PIXELWORKS
      INC**
    
    
    **7,592**
    
    
    **130,393.94**
    
    
    **135,744.96****POLTECH
      CORP**
    
    
    **10,249**
    
    
    **392,419.19**
    
    
    **388,232.12****PULTE
      HOMES INC.**
    
    
    **2,253**
    
    
    **109,460.51**
    
    
    **110,780.01****QUALCOMM,
      CORP.**
    
    
    **6,097**
    
    
    **348,946.06**
    
    
    **380,818.62****QUEST
      DIAGNOSTICS INC**
    
    
    **360**
    
    
    **29,553.00**
    
    
    **30,366.00****RADIO
      ONE INC CLASS A**
    
    
    **2,188**
    
    
    **40,200.34**
    
    
    **41,659.52****RADIO
      ONE INC**
    
    
    **19,619**
    
    
    **365,247.90**
    
    
    **371,976.24****RED
      HAT INC**
    
    
    **17,141**
    
    
    **380,177.06**
    
    
    **389,443.52****RESEARCH
      IN MOTION LTD**
    
    
    **3,835**
    
    
    **282,182.52**
    
    
    **334,028.50****ROGERS
      CORP**
    
    
    **583**
    
    
    **34,278.07**
    
    
    **34,805.10****SAPIENT
      CORP**
    
    
    **5,751**
    
    
    **38,601.92**
    
    
    **32,205.60****SCHLUMBERGER
      LTD**
    
    
    **6,670**
    
    
    **414,047.25**
    
    
    **390,395.10****SILICON
      LABORATORIES INC**
    
    
    **905**
    
    
    **39,994.76**
    
    
    **42,670.75****SMART
      & FINAL INC**
    
    
    **3,180**
    
    
    **38,974.18**
    
    
    **36,729.00****STANLEY
      WORKS**
    
    
    **9,101**
    
    
    **389,236.29**
    
    
    **386,883.51****STARBUCKS
      CORP.**
    
    
    **739**
    
    
    **29,105.22**
    
    
    **28,761.88****STATION
      CASINOS INC**
    
    
    **845**
    
    
    **40,597.77**
    
    
    **38,092.60****SYMANTEC
      CORP**
    
    
    **8,723**
    
    
    **289,259.04**
    
    
    **392,971.15****TECHNE
      CORP.**
    
    
    **1,020**
    
    
    **38,379.24**
    
    
    **39,892.20****TELECOM
      CORP OF NEW ZEALAND**
    
    
    **13,356**
    
    
    **421,684.95**
    
    
    **379,043.28****THERMO
      ELECTRON CORP**
    
    
    **1,388**
    
    
    **39,656.27**
    
    
    **40,529.60****THOMAS
      & BETTS CORP**
    
    
    **3,734**
    
    
    **90,021.89**
    
    
    **89,765.36****TRANSACTION
      SYSTEMS ARCHITEC**
    
    
    **17,902**
    
    
    **309,999.39**
    
    
    **380,059.46****UNV
      PHOENIX ONLINE**
    
    
    **4,616**
    
    
    **324,159.48**
    
    
    **401,961.28****URBAN
      OUTFITTERS INC.**
    
    
    **8,401**
    
    
    **191,294.24**
    
    
    **387,874.17****VARIAN
      MEDICAL SYSTEMS INC.**
    
    
    **479**
    
    
    **39,805.53**
    
    
    **41,117.36****WATERS
      CORP.**
    
    
    **1,091**
    
    
    **38,370.98**
    
    
    **47,076.65****WEBEX
      INC.**
    
    
    **13,612**
    
    
    **249,071.39**
    
    
    **305,453.28****WEBSENSE
      INC**
    
    
    **1,245**
    
    
    **39,815.10**
    
    
    **36,727.50****WEIGHT
      WATCHERS INTL INC**
    
    
    **951**
    
    
    **40,693.29**
    
    
    **37,089.00****WHOLE
      FOODS MARKET INC**
    
    
    **503**
    
    
    **40,465.39**
    
    
    **40,234.97****YAHOO
      INC**
    
    
    **742**
    
    
    **40,230.79**
    
    
    **37,493.26****ZIMMER
      HOLDINGS INC**
    
    
    **4,337**
    
    
    **339,584.77**
    
    
    **346,309.45****TO
      MARKETABLE SECURITIES**
    
    
    
    
    
    **18,853,718.68**
    
    
    **19,981,428.09**
 
 47
 
 **Value
      Line, Inc.****Schedule
      XIII-Other Investments:4/30/2004**

**Long
      Term Securities Available For Sale:**
    
    **Historical**
    
    **Market****Cost**
    
    **Value****Investments
      In Value Line Mutual Funds****The
      Value Line Emerging Opportunity Fund, Inc.**
    
    
    **9,155,526**
    
    
    **19,205,507****The
      Value Line Asset Allocation Fund, Inc.**
    
    
    **15,346,729**
    
    
    **27,147,244****Total
      Investments In Value Line Mutual Funds**
    
    $
    **24,502,255**
    
    $
    **46,352,751****Other
      Long Term Investments:****300
      Shares of National Association of Securities Dealers,
      Inc.**
    
    $
    **3,000**
    
    $
    **3,000****Fixed
      Income Investments****Federal
      Home Loan Bank 2.50% due 4/06**
    
    
    **1,000**
    
    
    **999****Total
      Fixed Income Investments**
    
    $
    **1,000**
    
    $
    **999****Total
      Long Term Securities Available For Sale**
    
    $
    **24,506,255**
    
    $
    **46,356,750**
 
 48