Value Line, Inc., (NASDAQ: VALU) reported results for its fiscal year ended April 30, 2011.

As of December 23, 2010, Value Line, Inc. completed the restructuring of its asset management and mutual fund distribution businesses. As part of the Restructuring Transaction EULAV Asset Management LLC and broker-dealer EULAV Securities, Inc. were deconsolidated and restructured as a Delaware statutory trust named EULAV Asset Management Trust (“EAM”). In the transaction, Value Line received a significant non-voting revenues interest and profits interest in EAM. Details of the Transaction were further discussed on the Form 10-K filed on December 27, 2010.

For the twelve months ended April 30, 2011, the Company’s net income of $37,782,000, or $3.79 per share, which included a pre-tax gain of $50,510,000 from deconsolidation of the Company’s former investment management subsidiaries, EAM LLC and ESI, and a $1,767,000 reduction in the estimated cost of administration of the Fair Fund, was $60,970,000 above the net loss of $23,188,000, or $2.32 per share, for the twelve months ended April 30, 2010. The net loss for fiscal 2010 included $48,106,000 of expenses related to the SEC Settlement and a one-time charge of $727,000 for the write down of development software. Operating income was $8,533,000 for fiscal 2011 compared to the operating loss of $32,190,000 for fiscal 2010. Operating income for fiscal 2010 included the previously mentioned SEC Settlement expense while operating income for fiscal 2011 included a reduction of $1,767,000 to those expenses resulting from a change in the estimated cost of administration of the Fair Fund, restructuring expenses of $3,764,000, post-employment compensation expense of $1,770,000 related to the grant of a voting profits interest in EAM to a former employee, $914,000 of expenses for operating lease exit costs related to the relocation of the EAM operations.

Shareholders’ equity of $33,254,000 at April 30, 2011, which includes the gain from deconsolidation of its former subsidiaries and postemployment compensation, was 55% higher than shareholders’ equity of $21,448,000 at April 30, 2010. Retained earnings were over $31 million and liquid assets over $19 million at year end April 30, 2011.

Value Line, Inc. is a leading New York based publishing company. Value Line believes The Value Line Investment Survey is one of the most widely read independent investment publications. Value Line also produces and publishes other proprietary investment periodicals in both print and electronic formats, including the newly introduced Value Line Dividend Select product. Value Line has copyrighted data, which it distributes under copyright agreements for fees, including certain proprietary ranking system information and other proprietary information used in third party products. Investment Management Services are provided through its substantial non-controlling and non-voting interest in EULAV Asset Management.

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995

This report contains statements that are predictive in nature, depend upon or refer to future events or conditions (including certain projections and business trends) accompanied by such phrases as “believe”, “estimate”, “expect”, “anticipate”, “will”, “intend” and other similar or negative expressions, that are “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995. Actual results for Value Line, Inc. (“Value Line” or “the Company”) may differ materially from those projected as a result of certain risks and uncertainties, including but not limited to the following:
  • dependence on key personnel;
  • maintaining revenue from subscriptions for the Company’s published products;
  • protection of intellectual property rights;
  • changes in market and economic conditions, including global financial issues;
  • dependence on revenue and profits from EULAV Asset Management Trust, a Delaware business trust (“EAM”), which provides investment management and distribution, marketing and administrative services to the Value Line branded mutual funds;
  • fluctuations in EAM’s assets under management due to broadly based changes in the values of equity and debt securities, redemptions by investors and other factors;
  • competition in the fields of publishing, copyright data and investment management;
  • the impact of government regulation on the Company’s and EAM’s business and the uncertainties of litigation and regulatory proceedings;
  • availability of free or low cost investment data through discount brokers or generally over the internet;
  • the risk that, while the Company believes that the restructuring transaction that closed on December 23, 2010, has achieved compliance with the requirements of the order issued by the Securities and Exchange Commission on November 4, 2009, the Company might be required to take additional steps which could adversely affect the Company’s results of operations or the Company’s financial condition;
  • terrorist attacks and natural disasters; and
  • other risks and uncertainties, including but not limited to the risks described in Item 1A, “Risk Factors” of the Company’s Annual Report on Form 10-K for the year ended April 30, 2011 filed with the SEC on July 29, 2011, and other risks and uncertainties from time to time.

Any forward-looking statements are made only as of the date hereof, and the Company undertakes no obligation to update or revise the forward-looking statements, whether as a result of new information, future events or otherwise.
           
Value Line, Inc.
Consolidated Condensed Summary of Financial Results
(in thousands, except per share amounts)
                 
        For the three months

ended April 30,
      For the twelve months

ended April 30,
        2011       2010       2011       2010  
Revenues       $ 9,525       $ 13,913       $ 48,667       $ 58,140  
Operating income/(loss)       $ 2,673       $ 2,578       $ 8,533         ($32,190 )
Gain from deconsolidation of subsidiaries        

-
       

-
     

$

50,510
       

-
 
Revenues and profits interests from EAM Trust      

$

1,631
       

-
     

$

2,355
       

-
 
Income from securities transactions, net      

$

17
     

$

283
     

$

65
     

$

837
 
Income/(loss) before income taxes       $ 4,321       $ 2,861       $ 61,463         ($31,353 )
Net income/(loss)       $ 2,761       $ 2,445       $ 37,782         ($23,188 )
Earnings/(loss) per share, basic and fully diluted      

$

0.28
     

$

0.25
     

$

3.79
       

($2.32

)

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