10-K 1 valu20200430_10k.htm FORM 10-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark One)

☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended April 30, 20 20

or

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _____________________________________ to __________________________________

Commission file number: 0-11306

VALUE LINE, INC.

(Exact name of registrant as specified in its charter)

New York |  | 13-3139843
(State or other jurisdiction of incorporation or organization) |  | (I.R.S. Employer Identification No.)
551 Fifth Avenue, New York, New York |  | 10176-0001
(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:

Title of each class | Trading symbol | Name of each Exchange on which registered
Common stock, $0.10 par value per share | VALU | The Nasdaq Capital Market

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

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. ☐ Yes ☒ No

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. ☐ Yes ☒ No

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

Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☒ Yes ☐ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). ☒ Yes ☐ No

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulations S-K (§229.405 of this chapter) 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. ☒

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See definition of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer ☐ | Accelerated filer ☐ | Non-accelerated filer ☒ | Smaller reporting company ☐ | Emerging growth company ☐

If an emerging growth company, indicate by check mark whether the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

☐ Yes ☐ No

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ☐ Yes ☒ No

The aggregate market value of the registrant's voting and non-voting common stock held by non-affiliates at October 31, 2019 was $20,499,767.

There were 9,616,721 shares of the registrant’s Common Stock outstanding at June 30, 2020.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the registrant’s Proxy Statement relating to the registrant’s 20 20 Annual Meeting of Shareholders, to be held on

October 9, 20 20, are incorporated by reference into Part III of this Annual Report on Form 10-K where indicated.

TABLE OF CONTENTS

PART I
Item 1 | Business | 5
Item 1A | Risk Factors | 15
Item 1B | Unresolved Staff Comments | 18
Item 2 | Properties | 18
Item 3 | Legal Proceedings | 19
Item 4 | Mine Safety Disclosures | 19
PART II
Item 5 | Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities | 19
Item 6 | Selected Financial Data | 21
Item 7 | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 22
Item 7A | Quantitative and Qualitative Disclosures About Market Risk | 39
Item 8 | Financial Statements and Supplementary Data | 41
Item 9 | Changes in and Disagreements with Accountants on Accounting and Financial Disclosure | 43
Item 9A | Controls and Procedures | 43
Item 9B | Other Information | 44
PART III
Item 10 | Directors, Executive Officers, and Corporate Governance | 45
Item 11 | Executive Compensation | 46
Item 12 | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters | 47
Item 13 | Certain Relationships and Related Transactions and Director Independence | 47
Item 14 | Principal Accounting Fees and Services | 48
PART IV
Item 15 | Exhibits and Financial Statement Schedules | 49

Value Line, the Value Line logo, The Most Trusted Name In Investment Research, “Smart research. Smarter investing”, The Value Line Investment Survey, Value Line Select, Timeliness and Safety are trademarks or registered trademarks of Value Line Inc. and/or its affiliates in the United States and other countries. All other trademarks are the property of their respective owners.

Cautionary Statement Regarding Forward-Looking Information

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, as amended. 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:

| ● | maintaining revenue from subscriptions for the Company’s digital and print published products;
| ● | changes in market and economic conditions, including global financial issues;
| ● | protecting intellectual property rights;
| ● | dependence on non-voting revenues and non-voting profits interests in EULAV Asset Management, a Delaware statutory trust (“EAM” or “EAM Trust”), which serves as the investment advisor to the Value Line Funds and engages in related distribution, marketing and administrative services;
| ● | fluctuations in EAM’s and third party copyright assets under management due to broadly based changes in the values of equity and debt securities, redemptions by investors and other factors;
| ● | possible changes in the valuation of EAM’s intangible assets from time to time;
| ● | generating future revenues or collection of receivables from significant customers;
| ● | dependence on key personnel;
| ● | competition in the fields of publishing, copyright and investment management, along with associated effects on the level and structure of prices and fees, and the mix of services delivered;
| ● | the impact of government regulation on the Company’s and EAM’s businesses;
| ● | availability of free or low cost investment data through discount brokers or generally over the internet;
| ● | terrorist attacks, cyber attacks and natural disasters;
| ● | the coronavirus pandemic, which has drastically affected markets, employment, and other economic conditions, and may have additional unpredictable impacts on employees, suppliers, customers, and operations;
| ● | other possible epidemics;
| ● | changes in prices of materials and other inputs required by the Company;
| ● | other risks and uncertainties, including but not limited to the risks described in Item 1A, “Risk Factors” herein; and other risks and uncertainties arising from time to time.

These factors are not necessarily all of the important factors that could cause actual results to differ materially from those expressed in any of our forward-looking statements. Other unknown or unpredictable factors which may involve external factors over which we may have no control or changes in our plans, strategies, objectives, expectations or intentions, which may happen at any time at our discretion, could also have material adverse effects on future results. Except as otherwise required to be disclosed in periodic reports required to be filed by public companies with the SEC pursuant to the SEC's rules, we have no duty to update these statements, and we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. In light of these risks and uncertainties, current plans, anticipated actions, and future financial conditions and results may differ from those expressed in any forward-looking information contained herein.

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Explanatory Note s

References in this Annual Report on Form 10-K for the fiscal year ending April 30, 2020, to “the Company”, “Value Line”, “we”, “us” and “our” refer to Value Line, Inc. and its consolidated subsidiaries, unless the context otherwise requires. In addition, unless the context otherwise requires, references to:

“fiscal 2020” are to the twelve month period from May 1, 2019 to April 30, 2020;

“fiscal 2019” are to the twelve month period from May 1, 2018 to April 30, 2019;

“fiscal 2018” are to the twelve month period from May 1, 2017 to April 30, 2018;

the “Adviser” or “EAM” are to EULAV Asset Management Trust, a Delaware business statutory trust;

the “Distributor” or “ES” are to EULAV Securities LLC, a Delaware limited liability company wholly

owned by EAM;

“EAM LLC” are to EULAV Asset Management LLC, a Delaware limited liability company and wholly-owned former subsidiary of the Company, which prior to the Restructuring Date, was the adviser to the Value Line Funds;

“ESI” are to EULAV Securities, Inc., a New York corporation and wholly-owned subsidiary of the Company which, prior to the Restructuring Date was the distributor of the Value Line Funds;

the “EAM Declaration of Trust” are to the EAM Declaration of Trust dated December 23, 2010;

the “Restructuring Date” are to December 23, 2010, the effective date of the Restructuring Transaction;

the “Restructuring Transaction” are to the restructuring of the Company’s asset management and mutual fund distribution businesses whereby (1) ESI was restructured into ES, (2) the Company transferred 100% of its ownership interest in ES to EAM LLC, (3) EAM LLC was converted into EAM and (4) the capital structure of EAM was established so that the Company owns only non-voting revenue and non-voting profits interests of EAM, and each of five individuals owns 20% of the voting profits interests of EAM; and

the “Value Line Funds” or the “Funds” are to the Value Line Mutual Funds registered under the Investment Company Act of 1940 for which EAM serves (and, prior to the Restructuring Date, EAM LLC served) as investment adviser.

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Part I

Item 1. BUSINESS.

Value Line, Inc. is a New York corporation headquartered in New York City and formed in 1982. The Company's core business is producing investment periodicals and their underlying research and making available certain Value Line copyrights, Value Line trademarks and Value Line Proprietary Ranking System results and other proprietary information, to third parties under written agreements for use in third-party managed and marketed investment products and for other purposes. Value Line markets under well-known brands including Value Line®, the Value Line logo®, The Value Line Investment Survey®, Smart Research, Smarter Investing™ and The Most Trusted Name in Investment Research®. The name "Value Line" as used to describe the Company, its products, and its subsidiaries, is a registered trademark of the Company. Prior to December 23, 2010, (see “Asset Management and Mutual Fund Distribution Businesses” below), the Company provided investment management services to the Value Line Mutual Funds ("Value Line Funds"), institutional and individual accounts and provided distribution, marketing, and administrative services to the Value Line Funds. Since December 23, 2010, EULAV Asset Management Trust (“EAM”) provides the investment management services to the Value Line Funds accounts and provides distribution, marketing, and administrative services to the Value Line Funds. Value Line holds substantial non-voting revenues and non-voting profits interests in EAM.

The Company is the successor to substantially all of the operations of Arnold Bernhard & Co, Inc. ("AB&Co."). AB&Co. is the controlling shareholder of the Company and, as of April 30, 2020, owns 89.78% of the outstanding shares of the common stock of the Company.

A. Investment Related Periodicals & Publications

The investment periodicals and related publications offered by Value Line Publishing LLC (“VLP”), a wholly-owned entity of the Company, cover a broad spectrum of investments including stocks, mutual funds, ETFs and options. The Company’s periodicals and related publications and services are marketed to individual and professional investors, as well as to institutions including municipal and university libraries and investment firms.

The services generally fall into four categories:

| ● | Comprehensive reference periodical publications

| ● | Targeted, niche periodical newsletters

| ● | Investment analysis software

| ● | Current and historical financial databases

The comprehensive research services (The Value Line Investment Survey, The Value Line Investment Survey - Small and Mid-Cap, The Value Line 600, and The Value Line Fund Advisor Plus) provide both statistical and text coverage of a large number of investment securities, with an emphasis placed on Value Line’s proprietary research, analysis and statistical ranks. The Value Line Investment Survey is the Company’s flagship service, published each week in print and daily on the web, and covering approximately 1,700 stocks.

The niche newsletters (Value Line Select®, Value Line Select: Dividend Income & Growth, Value Line Select: ETFs, and The Value Line Special Situations Service®) provide information on a less comprehensive basis for securities that the Company believes will be of particular interest to subscribers. These services also make use of Value Line’s proprietary statistical ranks and ratings. Value Line Select® is a targeted service with an emphasis on Value Line’s proprietary in-depth research analysis and statistical selections, highlighting a monthly stock with strong return potential and reasonable risk. Value Line Select: Dividend Income & Growth represents Value Line's targeted coverage of dividend paying stocks with good growth potential. Value Line Select: ETFs recommends a new ETF for purchase each month. The Value Line Special Situations Service provides in-depth research analysis on selected small and mid-cap stocks.

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Value Line offers digital versions of most of its products through the Company’s website, www.valueline.com. Subscribers to the print versions have, in some cases, received free access to the corresponding digital versions, although digital subscribers do not receive a free print edition. The most comprehensive of the Company’s online platforms is The Value Line Research Center, which allows subscribers to access most of the Company’s research and publications at a packaged price via the Internet.

Investment analysis software (The Value Line Investment Analyzer) includes data sorting and filtering tools. In addition, for institutional and professional subscribers, VLP offers current and historical financial databases (DataFile, Estimates & Projections, and Mutual Funds) via the Internet.

The print and digital services include, but are not limited to the following:

The Value Line Investment Survey

The Value Line Investment Survey is an investment periodical research service providing both timely articles on economic, financial and investment matters and analysis and ranks for equity securities. Two of the evaluations for covered equity securities are "Timeliness™" and "Safety™”. “Timeliness” Ranks relate 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 stocks covered. Ranks 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 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 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 Value Line Investment Survey is comprised of three parts: The "Summary & Index" provides updated Timeliness and Safety Ranks, selected financial data, and "screens" of key financial measures; the "Ratings & Reports" section contains updated reports on about 130 stocks each week; and the “Selection & Opinion” section provides economic commentary and data, general interest articles, and four model portfolios managed by analysts covering a range of investment approaches.

The Value Line Investment Survey - Small and Mid-Cap

The Value Line Investment Survey - Small and Mid-Cap is an investment research product introduced in 1995 that provides short descriptions of and extensive data for approximately 1,700 small and medium-capitalization stocks, many listed on The NASDAQ Exchange, beyond the approximately 1,700 equity securities of generally larger-capitalization companies covered in The Value Line Investment Survey. Like The Value Line Investment Survey, the Small and Mid-Cap has its own "Summary & Index" providing updated performance ranks and other data, as well as "screens" of key financial measures and two model portfolios. The "Ratings and Reports" section, providing updated reports on around 130 equity securities each week, has been organized to correspond closely to the industries reviewed in The Value Line Investment Survey. One unique feature of the Small and Mid-Cap is The Performance Ranking System, which incorporates many of the elements of the Value Line Timeliness Ranking System, modified to accommodate the approximately 1,700 equity securities in the Small and Mid-Cap Survey. The Performance Rank is based on earnings growth and price momentum, and is designed to predict relative price performance over the next six to twelve months. The principal differences between the Small and Mid-Cap Survey and The Value Line Investment Survey are that the Small and Mid-Cap Survey does not include Value Line’s Timeliness Ranks, financial forecasts, analyst commentary, or a Selection & Opinion section. These modifications allow VLP to offer this service at a lower price.

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The Value Line Fund Advisor Plus

The Value Line Mutual Fund Ranking System was introduced in 1993. It is the system utilized in the Fund Advisor Plus product, a 48-page newsletter featuring load, no-load, and low-load open-end mutual funds. Each issue offers strategies for maximizing total return, and highlights of specific mutual funds. It also includes information about retirement planning and industry news. A full statistical review, including latest performance, ranks, and sector weightings, is updated each month on approximately 800 leading load, no-load and low-load funds. Included with this product is online access to Value Line’s database of approximately 20,000 mutual funds, including screening tools and full-page printable reports on each fund.

The Fund Advisor was discontinued in June 2018 and replaced by The Value Line Fund Advisor Plus, which contains data on approximately 20,000 no-load and low-load funds and a new digital screener. The new screener offers additional fields (about a dozen more) and functionality (e.g. export).

The Value Line Special Situations Service

The Value Line Special Situations Service’s core focus is on smaller companies whose equity securities are perceived by Value Line’s analysts as having exceptional appreciation potential. This publication was introduced in 1951. A second portfolio of stocks for more conservative investors seeking small company exposure was added in 2009.

The Value Line Options Survey

The Value Line Options Survey is a daily digital service that evaluates and ranks approximately 500,000 U.S. equity and equity index options. Features include an interactive database, spreadsheet tools, and a weekly email newsletter. This product is only offered as an online subscription due to the volatility in the pricing of options.

Value Line Select

Value Line Select is a monthly stock selection service and was first published in 1998. It focuses each month on a single company that the Value Line Research Department has selected from a group of high-quality companies whose stocks are viewed as having a superior risk/reward ratio. Recommendations are backed by in-depth research and are subject to ongoing monitoring by research personnel.

Value Line Select: Dividend Income & Growth

Value Line Select: Dividend Income & Growth (formerly Value Line Dividend Select), a monthly stock selection service, was introduced in June 2011. This product focuses on companies with dividend yields greater than the average of all stocks covered by Value Line, with a preference for companies that have consistently increased their dividends above the rate of inflation over the longer term and, based on Value Line analysis, have the financial strength both to support and increase dividend payments in the future. Value Line Select: Dividend Income and Growth is available online and in print.

Value Line Select: ETFs

In May 2017, we launched Value Line Select: ETFs, a monthly ETF selection service. This product focuses on ETFs that appear poised to outperform the broader market. The selection process utilizes an industry approach, with the same data-focused analysis that is the hallmark of Value Line.

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The New Value Line ETFs Service

In September 2019, we introduced The New Value Line ETFs Service. This online-only product provides data, analysis, and screening capabilities on more than 2,700 publicly traded ETFs. Almost all of the ETFs tracked in the product are ranked by The Value Line ETF Ranking System, a proprietary estimate with the goal of predicting an ETF’s future performance relative to all other ranked ETFs. The screener includes more than 30 fields, and each ETF has its own full PDF report. All data and information can be downloaded, exported, and printed.

The Value Line 600

The Value Line 600 is a monthly publication, which contains full-page research reports on approximately 600 equity securities. Its reports provide information on many actively traded, larger capitalization issues as well as some smaller growth stocks. As a lower priced service, it offers investors who want the same type of analysis provided in The Value Line Investment Survey, but who do not want or need coverage of the approximately 1,700 companies covered by that product a suitable alternative. Readers also receive supplemental reports as well as a monthly Index, which includes updated statistics, including proprietary ranks and ratings. A model portfolio, delivered via a weekly email newsletter, was added to this service in January 2015.

Value Line Information You Should Know Wealth Newsletter

This is a monthly service that started with January 2020. It is a general interest publication focusing on useful and actionable investing and financial information. It is a succinct 4 page newsletter covering topics such as. “How Can I Avoid Probate? And Should I?”, “How to Handle Your Investments in a Bear Market”. It is available as a print product or as a PDF delivered via email. The newsletter is marketed via a variety of channels including as an add-on in select direct mail campaigns and email.

Value Line Investment Analyzer

Value Line Investment Analyzer is a powerful menu-driven software program with fast filtering, ranking, reporting and graphing capabilities utilizing more than 230 data fields for various industries and indices and for the approximately 1,700 stocks covered in VLP’s flagship publication, The Value Line Investment Survey. Value Line Investment Analyzer allows subscribers to apply numerous charting and graphing variables for comparative research. In addition to containing digital replicas of the entire Value Line Investment Survey, the Value Line Investment Analyzer includes 20-minute delayed data updates through its integration with the Value Line databases via the Internet. Value Line Investment Analyzer Professional is a more comprehensive product which covers some 5,500 stocks and allows subscribers to create both standardized and customized screens.

Value Line DataFile Products

For our institutional customers, Value Line offers both current and historical data for equities, mutual funds and exchange traded funds (“ETFs”). Value Line DataFile products are offered via FTP. Below is a listing of the DataFile products:

Fundamental DataFile I and II

Value Line’s Fundamental DataFile I contains fundamental data (both current and historical) on more than 5,500 publicly traded companies that follow U.S. generally accepted accounting principles (“GAAP”). This data product provides annual data from 1955, quarterly data from 1963, and full quarterly data as reported to the SEC from 1985. Value Line also offers historical data on over 9,500 companies that no longer exist in nearly 100 industries via our “Dead Company” File. The Fundamental DataFile has over 400 annual and over 80 quarterly fields for each of the companies included in the database. DataFile is sold primarily to the institutional and academic markets. Value Line also offers a scaled down DataFile product, Fundamental DataFile II, which includes a limited set of historical fundamental data.

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Estimates and Projections DataFile

This DataFile offering contains the proprietary estimates and projections from Value Line analysts on approximately 1,700 companies. Data includes earnings, sales, cash flow, book value, margin, and other popular fields. Estimates are for the current year and next year, while projections encompass the three to five year period.

Mutual Fund DataFile

The Value Line Mutual Fund DataFile covers approximately 20,000 mutual funds with up to 20 years of historical data with more than 200 data fields. The Mutual Fund DataFile provides monthly pricing, basic fund information, weekly performance data, sector weights, and many other important mutual fund data fields. This file is updated monthly and delivered via FTP.

Value Line Research Center

The Value Line Research Center provides on-line access to select Company investment research services covering stocks, mutual funds, options and special situations stocks. This service includes full digital subscriptions to The Value Line Investment Survey, The Value Line Fund Advisor Plus, The Value Line Daily Options Survey, The Value Line Investment Survey - Small and Mid-Cap, The New Value Line ETFs Service and The Value Line Special Situations Service. Users can screen more than 250 data fields, create graphs using multiple different variables, and access technical history. The Value Line Research Center has the ability to track model portfolios (large, small and mid-cap) as well as providing ranks and news.

Digital Service s

The Value Line Investment Survey - Smart Investor offers digital access to full page reports, analyst commentary and Value Line proprietary ranks on approximately 1,700 stocks. Online tools include a screener, alerts, watch-lists and charting. Print capabilities are included.

The Value Line Investment Survey - Savvy Investor offers digital access to full page reports and Value Line proprietary ranks on approximately 3,400 stocks. Online tools include a screener, alerts, watch-lists and charting. Print capabilities are included.

The Value Line Investment Survey - Small Cap Investor offers digital access to full page reports and Value Line proprietary ranks on approximately 1,700 stocks. One year of history is included. Online tools include a screener, alerts, watch-lists and charting. Print capabilities are included.

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The Value Line Investment Survey - Investor 600, equivalent to The Value Line 600 print, offers digital access to full page reports, analyst commentary and Value Line proprietary ranks on approximately 600 selected stocks covering the same variety of industries as The Value Line Investment Survey. Online tools include a screener, alerts, watch-lists and charting. Print capabilities are included.

Value Line Pro Premium digital service includes The Value Line Investment Survey® and The Value Line Investment Survey® — Small & Mid-Cap and covers 3,400 stocks. This equity package monitors companies with market values ranging from $100 million to well over $500 billion, across nearly 100 industries, representing 95% of daily U.S. trading volume. There are over 250 data fields that can be screened to help make informed decisions. Features of the service include three years of historical reports and data, customizable modules, alerts and screening.

Value Line Pro Basic digital service covers the 1,700 stocks included in The Value Line Investment Survey®, drawn from 100 industries, representing 90% of total U.S. trading volume. There are over 200 data fields that can be screened to help make informed decisions. Features of the service include three years of historical reports and data, customizable modules, alerts and screening.

Value Line Pro Elite digital service includes The Value Line Investment Survey® and The Value Line Investment Survey® — Small & Mid-Cap. Pro Elite service package aimed at professional industry includes digital access to full page reports and Value Line proprietary ranks on approximately 3,400 stocks. In addition, our database of mostly microcap firms adds more than 2,000 additional names. Five years’ history is included. Online tools include a screener, alerts, watch-lists and charting. Downloading and print capabilities are included.

The Value Line Investment Survey – Library Basic covers the 1,700 stocks included in The Value Line Investment Survey, drawn from nearly 100 industries, and representing 90% of total U.S. daily trading volume. There are over 200 data fields that can be applied to help you make more informed decisions. Value Line has led its subscribers towards financial success by satisfying the demand for actionable insights and tools to manage equity investments.

The Value Line Investment Survey – Library Elite offers libraries digital access to full reports, analyst commentary and Value Line proprietary ranks on approximately 3,400 stocks, along with one year of fully-detailed history. Online tools include a screener, and charting. Print capabilities are included.

The Value Line Pro Equity Research Center is an equities-only package that includes access to exclusive premium services and provides online access to all of Value Line’s equity products. This service offered both to financial advisers and high-net-worth individuals, includes full online subscriptions to The Value Line Investment Survey, The Value Line Investment Survey – Small & Mid-Cap, Value Line Select, Value Line Select: Dividend Income and Growth, and The Value Line Special Situations Service. Users can screen more than 250 data fields, create graphs using multiple different variables, and access technical history. The Value Line Pro Equity Research Center has the ability to track model portfolios (large, small and mid-cap) as well as providing ranks and news.

All the digital services have Charting features, including many options to chart against popular indexes with the ability to save settings and print. Products offer an Alerts Hub which allows the user to set up alerts for up to 25 companies, with delivery via text or email.

B. Copyright Fees Programs

The Company’s available copyrights services, which include certain proprietary Ranking System results and other proprietary information are made available for use in third party products, such as unit investment trusts, variable annuities, managed accounts and exchange traded funds. The sponsors of these products act as wholesalers and distribute the products generally by syndicating them through an extensive network of national and regional brokerage firms. The sponsors of these products will typically receive Proprietary Ranking System results, which may include Value Line Timeliness, Safety, Technical and Performance ranks, as screens for their portfolios. The sponsors are also given permission to associate Value Line’s trademarks with the products. Value Line collects a copyright fee from each of the product sponsors/managers primarily based upon the market value of assets invested in each product’s portfolio utilizing the Value Line proprietary data. Since these fees are based on the market value of the respective portfolios using the Value Line proprietary data, the payments to Value Line, which are typically received on a quarterly basis, will fluctuate.

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Value Line’s primary copyright products are structured as ETFs and Unit Investment Trusts, all of which have in common some degree of reliance on the Value Line Ranking System for their portfolio creation. These products are offered and distributed by independent sponsors.

C. Investment Management Services

The Company completed a restructuring of its asset management and mutual fund distribution businesses (the “Restructuring Transaction”) on December 23, 2010 (the “Restructuring Date”) and executed the EAM Declaration of Trust (the “EAM Declaration of Trust”). Pursuant to the EAM Declaration of Trust, the Company received an interest in certain revenues of EAM and a portion of the residual profits of EAM but has no voting authority with respect to the election or removal of the trustees of EAM.

The business of EAM is managed by five individual trustees and a Delaware resident trustee (collectively, the “Trustees”) and by its officers subject to the direction of the Trustees.

Collectively, the holders of the voting profits interests in EAM are entitled to receive 50% of the residual profits of the business, subject to temporary adjustments in certain circumstances. Value Line holds a non-voting profits interest representing 50% of residual profits, subject to temporary adjustments in certain circumstances, and has no power to vote for the election, removal or replacement of the trustees of EAM. Value Line also has a non-voting revenues interest in EAM pursuant to which it is entitled to receive a portion of the non-distribution revenues of the business ranging from 41% at non-distribution fee revenue levels of $9 million or less to 55% at such revenue levels of $35 million or more. In the event the business is sold or liquidated, the first $56.1 million of net proceeds (the value of the business at the time the Restructuring Transaction was approved as determined by the directors of Value Line after reviewing a valuation report by the directors’ financial advisors) plus any additional capital contributions (Value Line or any holder of a voting profits interest, at its discretion, may make future contributions to its capital account in EAM), which contributions would increase its capital account but not its percentage interest in operating profits, will be distributed in accordance with capital accounts; 20% of the next $56.1 million will be distributed to the holders of the voting profits interests and 80% to the holder of the non-voting profits interests (currently, Value Line); and the excess will be distributed 45% to the holders of the voting profits interests and 55% to the holder of the non-voting profits interest (Value Line). EAM has elected to be taxed as a pass-through entity similar to a partnership.

Also, in connection with the Restructuring Transaction and pursuant to the EAM Declaration of Trust, Value Line (1) granted each Fund use of the name “Value Line” so long as EAM remains the Fund’s adviser and on the condition that the Fund does not alter its investment objectives or fundamental policies from those in effect on the date of the investment advisory agreement with EAM, provided also that the Funds do not use leverage for investment purposes or engage in short selling or other complex or unusual investment strategies that create a risk profile similar to that of so-called hedge funds, (2) agreed to provide EAM its proprietary Ranking System information without charge or expense on as favorable basis as to Value Line’s best institutional customers and (3) agreed to capitalize the business with $7 million of cash and cash equivalents at inception.

EAM is organized as a Delaware statutory trust and has no fixed term. However, in the event that control of the Company’s majority shareholder changes, or in the event that the majority shareholder no longer beneficially owns 5% or more of the voting securities of the Company, then the Company has the right, but not the obligation, to buy the voting profits interests in EAM at a fair market value to be determined by an independent valuation firm in accordance with the terms of the EAM Declaration of Trust.

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Value Line also has certain consent rights with respect to extraordinary events involving EAM, such as a proposed sale of all or a significant part of EAM, material acquisitions, entering into businesses other than asset management and fund distribution, paying compensation in excess of the mandated limit of 22.5%-30% of non-distribution fee revenues (depending on the level of such revenues), declaring voluntary bankruptcy, making material changes in tax or accounting policies or making substantial borrowings, and entering into related party transactions. These rights were established to protect Value Line’s non-voting revenues and non-voting profits interests in EAM.

Until December 23, 2010, the Company, through its wholly-owned subsidiary EAM LLC, was the investment adviser for the Value Line Funds. Since December 23, 2010, EAM has acted as the Adviser to the Value Line Funds.

Until December 23, 2010, the Company through its wholly-owned subsidiary ESI, was the distributor for the Value Line Funds. Since December 23, 2010, EULAV Securities has acted as the Distributor for the Value Line Funds. State Street Bank, an unaffiliated entity, is the custodian of the assets of the Value Line Funds and provides them with fund accounting and administrative services. Shareholder services for the Value Line Funds are provided by DST Asset Manager Solutions.

On December 23, 2010, the Company deconsolidated its asset management and mutual fund distribution businesses and its interests in these businesses were restructured as non-voting revenues and non-voting profits interests in EAM. Accordingly, the Company no longer reports this operation as a separate business segment, although it still maintains a significant interest in the cash flows generated by this business and will continue to receive ongoing payments in respect of its non-voting revenues and non-voting profits interests, as discussed below. Total assets in the Value Line Funds managed and/or distributed by EAM at April 30, 2020, were $3.58 billion, which is $485 million, or 15.7%, above total assets of $3.09 billion in the Value Line Funds managed and/or distributed by EAM at April 30, 2019.

Total net assets of the Value Line Funds at April 30, 2020, were:

|  | ($ in thousands) |
Value Line Asset Allocation Fund |  | $ | 1,255,505 |
Value Line Capital Appreciation Fund |  |  | 423,876 |
Value Line Select Growth Fund |  |  | 401,581 |
Value Line Mid Cap Focused Fund |  |  | 375,394 |
Value Line Small Cap Opportunities Fund |  |  | 360,291 |
Value Line Larger Companies Focused Fund |  |  | 290,902 |
Value Line Strategic Asset Management Fund |  |  | 232,433 |
Value Line Centurion Fund |  |  | 131,161 |
Value Line Core Bond Fund |  |  | 53,761 |
Value Line Tax Exempt Fund |  |  | 49,495 |
Value Line VIP Equity Advantage Fund |  |  | 1,678 |
Total EAM managed net assets |  | $ | 3,576,077 |

Investment management fees and distribution service fees (“12b-1fees”) vary among the Value Line Funds and may be subject to certain limitations. Certain investment strategies among the equity funds include, but are not limited to, reliance on the Value Line Timeliness ™ Ranking System (the “Ranking System”) and/or the Value Line Performance Ranking System in selecting securities for purchase or sale. Each Ranking System seeks to compare the estimated probable market performance of each stock during the next six to twelve months to that of all of the approximately 1,700 stocks under review in each system and ranks stocks on a scale of 1 (highest) to 5 (lowest). All the stocks followed by the Ranking System are listed on U.S. stock exchanges or traded in the U.S. over-the-counter markets. Prospectuses and annual reports for each of the Value Line open end mutual funds are available on the Funds’ website www.vlfunds.com. Each mutual fund may use "Value Line" in its name only to the extent permitted by the terms of the EAM Declaration of Trust.

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D. Wholly-Owned Operating Subsidiaries

Wholly-owned operating subsidiaries of the Company as of April 30, 2020 include the following:

1. | Value Line Publishing LLC (“VLP”) is the publishing unit for the investment related periodical publications and copyrights.

2. | Vanderbilt Advertising Agency, Inc. places advertising on behalf of the Company's publications.

3. | Value Line Distribution Center, Inc. (“VLDC”) provides subscription fulfillment services and subscriber relations services for Value Line’s publications and continues to distribute Value Line’s print publications.

E. Trademarks

The Company holds trademark and service mark registrations for various names and logos in multiple countries. Value Line believes that these trademarks and service marks provide significant value to the Company and are an important factor in the marketing of its products and services, as well as in the marketing of the Value Line Funds, now managed by EAM. The Company is utilizing all of its trademarks and service marks, and properly maintaining all registrations.

F. Investments

As of April 30, 2020 and April 30, 2019, the Company held total investment assets (excluding its interests in EAM) with a fair market value of $29,204,000 and $21,828,000, respectively, including equity securities and fixed income securities classified as available-for-sale on the Consolidated Balance Sheets. As of April 30, 2020 and April 30, 2019, the Company held equity securities classified as available-for-sale, which consist of investments in the SPDR Series Trust S&P Dividend ETF (SDY), First Trust Value Line Dividend Index ETF (FVD), PowerShares Financial Preferred ETF (PGF), Select Utilities Select Sector SPDR ETF (XLU), First Trust Value Line 100 ETF (FVL), ProShares Trust S&P 500 Dividend Aristocrats ETF (NOBL), SPDR S&P 500 ETF (SPY) and iShares Select Dividend ETF (DVY) and equity securities portfolio under EAM management held at Charles Schwab. As of April 30, 2020 and April 30, 2019, the Company held fixed income securities classified as available-for-sale, which consist of certificates of deposits and securities issued by federal, state and local governments within the United States.

G. Employees

At April 30, 2020, the Company and its subsidiaries employed 161 people.

The Company and 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. Value Line analysts are not permitted to own securities of the companies they cover. The Company has adopted rules requiring reports of securities transactions by employees for their respective accounts. The Company has also established policies restricting trading in securities whose ranks are about to change in order to avoid possible conflicts of interest.

H. Principal Business Segments

The information with respect to revenues from external customers and profit and loss of the Company's identifiable principal business segments is incorporated herein by reference to Note 18 of the Notes to the Company's Consolidated Financial Statements included in this Form 10-K.

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Prior to December 23, 2010, the Company’s businesses consolidated into two reportable business segments. The investment periodicals and related publications (retail and institutional) and Value Line copyrights and Value Line Proprietary Ranking System results and other proprietary information, consolidated into one segment called Publishing, and the investment management services to the Value Line Funds and other managed accounts were consolidated into a second business segment called Investment Management. Subsequent to December 23, 2010, the Publishing segment constitutes the Company’s only reportable business segment.

I. Competition

The investment information and publishing business conducted by the Company and the investment management business conducted by EAM 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 and EAM. The Internet continues to increase the amount of competition in the form of free and paid online investment research. With regard to the investment management business conducted by EAM, the prevalence of broker supermarkets or platforms permitting easy transfer of assets among mutual funds, mutual fund families, and other investment vehicles tends to increase the speed with which shareholders can leave or enter the Value Line Funds based, among other things, on short-term fluctuations in performance.

J. Executive Officers of the Registrant

The following table lists the names, ages (at June 30, 2020), 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. Except as noted, each of the following has held an executive position with the companies indicated for at least five years.

Name | Age | Principal Occupation or Employment |
Howard A. Brecher | 66 | Chairman and Chief Executive Officer since October 2011; Acting Chairman and Acting Chief Executive Officer from November 2009 to October 2011; Chief Legal Officer; Vice President and Secretary until January 2010; Vice President and Secretary of each of the Value Line Funds from June 2008 to December 2010; Secretary of EAM LLC from February 2009 until December 2010; Director and General Counsel of AB&Co. Mr. Brecher has been an officer of the Company for more than 20 years.
Stephen R. Anastasio | 61 | Vice President since December 2010; Director since February 2010; Treasurer since 2005. Mr. Anastasio has been an officer of the Company for more than 10 years.

WEBSITE ACCESS TO SEC REPORTS

The Company’s Internet site address is www.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 made available on the “Corporate Filings” page under the “About Value Line” tab on the Company’s website @www.valueline.com/About/corporate_filings.aspx. free of charge as soon as reasonably practicable after the reports are filed electronically with the SEC. All of the Company’s SEC reports are also available on the SEC Internet site, www.sec.gov.

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ITEM 1A. RISK FACTORS

In addition to the risks referred to elsewhere in this Form 10-K, the following risks, among others, sometimes may have affected, and in the future could affect, the Company’s businesses, financial condition or results of operations and/or the investment management business conducted by EAM and consequently, the amount of revenue we receive from EAM. The risks described below are not the only ones we face. Additional risks not discussed or not presently known to us or that we currently deem insignificant, may also impact our businesses.

The Company and its subsidiaries are dependent on the efforts of its executives and professional staff.

The Company’s future success relies upon its ability to retain and recruit qualified professionals and executives. The Company’s executive officers do not have employment agreements with the Company and the Company does not maintain “key man” insurance policies on any of its executive officers. The loss of the services of key personnel could have an adverse effect on the Company.

A decrease in the revenue generated by EAM’s investment management business could adversely affect the Company’s cash flow and financial condition.

The Company derives a significant portion of its cash flow from its non-voting revenues and non-voting profits interests in EAM. A decrease in the revenue generated by EAM’s investment management business, whether resulting from performance, competitive, regulatory or other reasons, would reduce the amount of cash flow received by the Company from EAM, which reduction could adversely affect the Company’s cash flow and financial condition.

EAM’s assets under management, which impact EAM’s revenue, and consequently the amount of the cash flow that the Company receives from EAM, are subject to fluctuations based on market conditions and individual fund performance.

Financial market declines and/or adverse changes in interest rates would generally negatively impact the level of EAM’s assets under management and consequently its revenue and net income. Major sources of investment management revenue for EAM (i.e., investment management and service and distribution fees) are calculated as percentages of assets under management. A decline in securities prices or in the sale of investment products or an increase in fund redemptions would reduce fee income. A prolonged recession or other economic or political events could also adversely impact EAM’s revenue if it led to decreased demand for products, a higher redemption rate, or a decline in securities prices. Good performance of managed assets relative to both competing products and benchmark indices generally assists in both retention and growth of assets, and may result in additional revenues. Conversely, poor performance of managed assets relative to competing products or benchmark indices tends to result in decreased sales and increased redemptions with corresponding decreases in revenues to EAM. Poor performance could therefore reduce the amount of cash flow that the Company receives from EAM, which reduction could adversely affect the Company’s financial condition.

EAM derive s all of its investment management fees from the Value Line Funds.

EAM is dependent upon management contracts and service and distribution contracts with the Value Line Funds under which these fees are paid. As required by the Investment Company Act of 1940 (the “1940 Act”), the Trustees/Directors of the Funds, all of whom are independent of the Company and EAM (except for the CEO of EAM), have the right to terminate such contracts. If any of these contracts are terminated, not renewed, or amended to reduce fees, EAM’s financial results, and consequently, the amount of cash flow received by the Company from EAM, and the Company’s financial condition, may be adversely affected.

A decrease in the revenue generated by a significant customer could adversely affect the Company’s cash flow and financial condition.

The Company derives a significant portion of its cash flow and publishing revenues from a single significant customer.

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If the Company does not maintain its subscriber base, its operating results could suffer.

A substantial portion of the Company’s revenue is generated from print and digital subscriptions, which are paid in advance by subscribers. Unearned revenues are accounted for on the Consolidated Balance Sheets of the Company within current and long-term liabilities. The backlog of orders is primarily generated through renewals and new subscription marketing efforts as the Company deems appropriate. Future results will depend on the renewal of existing subscribers and obtaining new subscriptions for the investment periodicals and related publications. The availability of competitive information on the Internet at low or no cost has had and may continue to have a negative impact on the demand for our products.

The Company believes that the negative trend in retail print subscription revenue experienced in rec ent years is likely to continue.

During the last several years, the Company has experienced a negative trend in retail print subscription revenue. It is expected that print revenues will continue to decline long-term, while the Company emphasizes digital offerings. The Company has established the goal of maintaining competitive digital products and marketing them through traditional and digital channels to retail and institutional customers. However, the Company is not able to predict whether revenues from digital retail publications will grow more than print revenues decline, nor whether its initiatives to increase business in the professional investor market segment will continue to be successful.

Loss of copyright clients or decline in their customers, or assets managed by third party sponsors could reduce the Company’s revenues.

Copyright agreements are based on market interest in the respective proprietary information. The Company believes this part of the business is dependent upon the desire of third parties to use the Value Line trademarks and proprietary research for their products, competition and on fluctuations in segments of the equity markets. If the fees from proprietary information decline, the Company’s operating results could suffer.

Failure to protect its intellectual property rights and proprietary information could harm the Company’s ability to compete effectively and could negatively affect operating results.

The Company’s trademarks are important assets to the Company. Although its trademarks are registered in the United States and in certain foreign countries, the Company may not always be successful in asserting global trademark protection. In the event that other parties infringe on its intellectual property rights and it is not successful in defending its intellectual property rights, the result may be a dilution in the value of the Company’s brands in the marketplace. If the value of the Company’s brands becomes diluted, such developments could adversely affect the value that its customers associate with its brands, and thereby negatively impact its sales. Any infringement of our intellectual property rights would also likely result in a commitment of Company resources to protect these rights through litigation or otherwise. In addition, third parties may assert claims against our intellectual property rights and we may not be able successfully to resolve such claims. The Company is utilizing all of its trademarks and properly maintaining registrations for them.

Adverse changes in market and economic conditions could lower demand for the Company’s and EAM’s products and services.

The Company provides its products and services to individual investors, financial advisors, and institutional clients. Adverse conditions in the financial and securities markets may have an impact on the Company’s subscription revenues, securities income, and copyright fees which could adversely affect the Company’s results of operations and financial condition. Adverse conditions in the financial and securities markets could also have an adverse effect on EAM’s investment management revenues and reduce the amount of cash flow that the Company receives from EAM, which reduction could adversely affect the Company’s financial condition.

The Company and EAM face significant competition in their respective businesses.

Both the investment information and publishing business conducted by the Company and the investment management business conducted by EAM 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 and EAM. With regard to the investment information and publishing business, barriers to entry have been reduced by the minimal cost structure of the Internet and other technologies. With regard to the investment management business, the absence of significant barriers to entry by new investment management firms in the mutual fund industry increases competitive pressure. Competition in the investment management business is based on various factors, including business reputation, investment performance, quality of service, marketing, distribution services offered, the range of products offered and fees charged. Access to mutual fund distribution channels has also become increasingly competitive.

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Government regulations, any changes to government regulations, and regulatory proceedings and litigation may adversely im pact the business.

Changes in legal, regulatory, accounting, tax and compliance requirements could have an effect on EAM’s operations and results, including but not limited to increased expenses and restraints on marketing certain funds and other investment products. EAM is registered with the SEC under the Investment Advisers Act of 1940 (the “Advisers Act”). The Advisers Act imposes numerous obligations on registered investment advisers, including fiduciary, record keeping, operational and disclosure obligations. ES is registered as a broker-dealer under the Securities Exchange Act of 1934 and is a member of the Financial Industry Regulatory Authority, also known as “FINRA”. Each Value Line Fund is a registered investment company under the 1940 Act. The 1940 Act requires numerous compliance measures, which must be observed, and involves regulation by the SEC. Each fund and its shareholders may face adverse tax consequences if the Value Line Funds are unable to maintain qualification as registered investment companies under the Internal Revenue Code of 1986, as amended. Those laws and regulations generally grant broad administrative powers to regulatory agencies and bodies such as the SEC and FINRA. If these agencies and bodies believe that EAM, ES or the Value Line Funds have failed to comply with their laws and regulations, these agencies and bodies have the power to impose sanctions. EAM, ES and the Value Line Funds, like other companies, can also face lawsuits by private parties. Regulatory proceedings and lawsuits are subject to uncertainties, and the outcomes are difficult to predict. Changes in laws, regulations or governmental policies, and the costs associated with compliance, could adversely affect the business and operations of the EAM, ES and the Value Line Funds. An adverse resolution of any regulatory proceeding or lawsuit against the EAM or ES could result in substantial costs or reputational harm to them or to the Value Line Funds and have an adverse effect on their respective business and operations. An adverse effect on the business and operations of EAM, ES and/or the Value Line Funds could reduce the amount of cash flow that the Company receives in respect of its non-voting revenues and non-voting profits interests in EAM and, consequently, could adversely affect the Company’s cash flows, results of operations and financial condition.

Terrorist attacks could adversely affect the Company and EAM.

A terrorist attack, including biological or chemical weapons attacks, and the response to such terrorist attacks, could have a significant impact on the New York City area, the local economy, the United States economy, the global economy, and U.S. and/or global financial markets, and could also have a material adverse effect on the Company’s business and on the investment management business conducted by EAM.

Our controlling stockholder exercises voting control over the Company and has the ability to elect or remove from office all of our directors.

As of April 30, 2020, AB&Co., Inc. beneficially owned 89.78% of the outstanding shares of the Company’s voting stock. AB&Co. is therefore able to exercise voting control with respect to all matters requiring stockholder approval, including the election or removal from office of all of our directors.

We are not subject to most of the listing standards that normally apply to companies whose shares are quoted on NASDAQ.

Our shares of common stock are quoted on the NASDAQ Capital Market (“NASDAQ”). Under the NASDAQ listing standards, we are deemed to be a “controlled company” by virtue of the fact that AB&Co. has voting power with respect to more than 50% of our outstanding shares of voting stock. A controlled company is not required to have a majority of its board of directors comprised of independent directors. Director nominees are not required to be selected or recommended for the board’s selection by a majority of independent directors or a nomination committee comprised solely of independent directors, nor do the NASDAQ listing standards require a controlled company to certify the adoption of a formal written charter or board resolution, as applicable, addressing the nominations process. A controlled company is also exempt from NASDAQ’s requirements regarding the determination of officer compensation by a majority of the independent directors or a compensation committee comprised solely of independent directors. Although we currently comply with certain of the NASDAQ listing standards that do not apply to controlled companies, our compliance is voluntary, and there can be no assurance that we will continue to comply with these standards in the future.

17

W e are subject to cyber risks and may incur costs in connection with our efforts to enhance and ensu re security from cyber attacks.

Substantial aspects of our business depend on the secure operation of our computer systems and e-commerce websites. Security breaches could expose us to a risk of loss or misuse of sensitive information, including our own proprietary information and that of our customers and employees. While we devote substantial resources to maintaining adequate levels of cyber security, our resources and technical sophistication may not be adequate to prevent all of the rapidly evolving types of cyber attacks. Anticipated attacks and risks may cause us to incur increasing costs for technology, personnel, insurance and services to enhance security or to respond to occurrences. We maintain cyber risk insurance, but this insurance may not be sufficient to cover all of our losses from any possible future breaches of our systems.

Changes to existing accounting pronouncements or taxation rules or practices may affect how we conduct our business and affect our reported results of operations.

New accounting pronouncements or tax rules and varying interpretations of accounting pronouncements or taxation practice have occurred and may occur in the future. A change in accounting pronouncements or interpretations or taxation rules or practices can have a significant effect on our reported results and may even affect our reporting of transactions completed before the change is effective. Changes to existing rules and pronouncements, future changes, if any, or the questioning of current practices or interpretations may adversely affect our reported financial results or the way we conduct our business.

Item 1B. UNRESOLVED STAFF COMMENTS.

None.

Item 2. PROPERTIES.

The Company leases 24,726 square feet of office space at 551 Fifth Avenue in New York, NY. In addition to the New York office space, the Company leases a warehouse facility with 24,110 square feet in New Jersey. The facility primarily serves the fulfillment and the distribution operations of VLDC for the various Company publications and serves as a disaster recovery site for the Company.

On November 30, 2016, Value Line, Inc., received consent from the landlord at 551 Fifth Avenue, New York, NY to the terms of a new sublease agreement between Value Line, Inc. and ABM Industries, Incorporated commencing on December 1, 2016. Pursuant to the agreement Value Line leased from ABM 24,726 square feet of office space located on the second and third floors at 551 Fifth Avenue, New York, NY (“Building” or “Premises”) beginning on December 1, 2016 and ending on November 29, 2027. Base rent under the sublease agreement is $1,126,000 per annum during the first year with an annual increase in base rent of 2.25% scheduled for each subsequent year, payable in equal monthly installments on the first day of each month, subject to customary concessions in the Company’s favor and pass-through of certain increases in utility costs and real estate taxes over the base year. The Company provided a security deposit represented by a letter of credit in the amount of $469,000 in October 2016, which is scheduled to be reduced to $305,000 on September 30, 2021 and fully refunded after the sublease ends. This Building became the Company’s new corporate office facility. The Company is required to pay for certain operating expenses associated with the Premises as well as utilities supplied to the Premises. The sublease terms provide for a significant decrease (23% initially) in the Company’s annual rental expenditure taking into account free rent for the first six months of the sublease. Sublandlord provided Value Line a work allowance of $417,000 which accompanied with the six months free rent worth $563,000 was applied against the Company’s obligation to pay rent at our NYC headquarters, delaying the actual rent payments until November 2017.

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On February 29, 2016, the Company’s subsidiary VLDC and Seagis Property Group LP (the “Landlord”) entered into a lease agreement, pursuant to which VLDC has leased 24,110 square feet of warehouse and appurtenant office space located at 205 Chubb Ave., Lyndhurst, NJ (“Warehouse”) beginning on May 1, 2016 and ending on April 30, 2024 (“Lease”). Base rent under the Lease is $192,880 per annum payable in equal monthly installments on the first day of each month, in advance during fiscal 2017 and will gradually increase to $237,218 in fiscal 2024, subject to customary increases based on operating costs and real estate taxes. The Company provided a security deposit in cash in the amount of $32,146, which will be fully refunded after the lease term expires. The lease is a net lease requiring the Company to pay for certain operating expenses associated with the Warehouse as well as utilities supplied to the Warehouse.

Item 3. LEGAL PROCEEDINGS.

None.

Item 4. MINE SAFETY DISCLOSURES.

Not applicable.

Part II

Item 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES.

The Registrant's Common Stock is traded on NASDAQ under the symbol “VALU”. The approximate number of record holders of the Registrant's Common Stock at April 30, 2020 was 33. As of April 30, 2020, the closing stock price was $30.98.

The reported high and low prices and the dividends declared on these shares during the past two fiscal years were as follows:

Quarter Ended |  | High |  |  | Low |  |  | Regular Dividend Declared Per Share |
April 30, 2020 |  | $ | 36.60 |  |  | $ | 20.01 |  |  | $ | 0.21 |
January 31, 2020 |  | $ | 36.31 |  |  | $ | 19.62 |  |  | $ | 0.20 |
October 31, 2019 |  | $ | 27.27 |  |  | $ | 18.40 |  |  | $ | 0.20 |
July 31, 2019 |  | $ | 29.49 |  |  | $ | 20.86 |  |  | $ | 0.20 |
April 30, 2019 |  | $ | 27.30 |  |  | $ | 19.00 |  |  | $ | 0.20 |
January 31, 2019 |  | $ | 30.64 |  |  | $ | 17.12 |  |  | $ | 0.19 |
October 31, 2018 |  | $ | 26.93 |  |  | $ | 20.88 |  |  | $ | 0.19 |
July 31, 2018 |  | $ | 25.14 |  |  | $ | 18.93 |  |  | $ | 0.19 |

On July 17, 2020, the Board of Directors of Value Line declared a quarterly dividend of $0.21 per share to shareholders of record as of July 27, 2020 to be paid on August 11, 2020.

There are no securities of the Company authorized for issuance under equity compensation plans. The Company did not sell any unregistered shares of common stock during the fiscal year ended April 30, 2020.

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Purchases of Equity Securities by the Company

The following table provides information with respect to all repurchases of common stock made by or on behalf of the Company during the fiscal quarter ended April 30, 2020. All purchases listed below were made in the open market at prevailing market prices.

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 (1) |
February 1, 2020 through February 29, 2020 |  |  | 1,537 |  |  | $ | 29.55 |  |  |  | 1,537 |  |  | $ | 821,000 |
March 1, 2020 through March 31, 2020 |  |  | 18,328 |  |  |  | 27.76 |  |  |  | 18,328 |  |  |  | 312,000 |
April 1, 2020 through April 30, 2020 |  |  | 2,959 |  |  |  | 29.55 |  |  |  | 2,959 |  |  |  | 2,000,000 |
Total |  |  | 22,824 |  |  | $ | 28.11 |  |  |  | 22,824 |  |  | $ | 2,000,000 |

(1) On April 17, 2020, the Company's Board of Directors approved a share repurchase program authorizing the repurchase of shares of the Company’s common stock up to an aggregate purchase price of $2,000,000. The repurchases may be made from time to time on the open market at prevailing market prices, in negotiated transactions off the market, in block purchases or otherwise. No purchases were made under this new program through the date of this report. The repurchase program may be suspended or discontinued at any time at the Company’s discretion and has no set expiration date. During fiscal 2020, the Company repurchased an aggregate of 46,840 shares of the Company's common stock for $1,214,000 at an average price of $25.91 per share under the prior repurchase program authorized on October 19, 2018. During fiscal 2019, the Company repurchased an aggregate of 28,059 shares of the Company's common stock for $608,000 at an average price of $21.68 per share under the prior repurchase program authorized on October 19, 2018. During fiscal 2018, the Company repurchased an aggregate of 20,045 shares of the Company's common stock for $354,000 at an average price of $17.67 per share.

Arnold Bernhard and Co., Inc. may purchase additional shares of common stock of the Company from time to time.

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Item 6. SELECTED FINANCIAL DATA.

|  | Fiscal Years Ended April 30, |
($ in thousands, except number of shares and earnings per share amounts) |  | 2020 |  |  | 2019 |  |  | 2018 |  |  | 2017 |  |  | 2016 |
Revenues: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Investment periodicals and related publications |  | $ | 27,628 |  |  | $ | 28,820 |  |  | $ | 29,503 |  |  | $ | 30,168 |  |  | $ | 31,925 |
Copyright fees |  |  | 12,671 |  |  |  | 7,437 |  |  |  | 6,365 |  |  |  | 4,406 |  |  |  | 2,621 |
Total investment periodicals and related publications |  | $ | 40,299 |  |  | $ | 36,257 |  |  | $ | 35,868 |  |  | $ | 34,574 |  |  | $ | 34,546 |
Gain on sale of operating facility |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 8,123 |  |  |  | - |
Total revenues |  | $ | 40,299 |  |  | $ | 36,257 |  |  | $ | 35,868 |  |  | $ | 42,697 |  |  | $ | 34,546 |
Income from operations |  | $ | 9,090 |  |  | $ | 5,413 |  |  | $ | 2,572 |  |  | $ | 7,459 |  |  | $ | 1,880 |
Revenues and profits interests from EAM Trust |  | $ | 12,350 |  |  | $ | 9,309 |  |  | $ | 8,786 |  |  | $ | 7,714 |  |  | $ | 7,651 |
Income from securities transactions and other, net |  | $ | 44 |  |  | $ | 504 |  |  | $ | 540 |  |  | $ | 312 |  |  | $ | 477 |
Net income |  | $ | 15,663 |  |  | $ | 11,150 |  |  | $ | 14,738 |  |  | $ | 10,367 |  |  | $ | 7,291 |
Earnings per share, basic and fully diluted |  | $ | 1.62 |  |  | $ | 1.15 |  |  | $ | 1.52 |  |  | $ | 1.07 |  |  | $ | 0.75 |
Total assets |  | $ | 109,728 |  |  | $ | 91,788 |  |  | $ | 86,788 |  |  | $ | 86,724 |  |  | $ | 86,507 |
Long term liabilities |  | $ | 29,364 |  |  | $ | 18,864 |  |  | $ | 18,376 |  |  | $ | 24,280 |  |  | $ | 25,609 |
Weighted average number of common shares outstanding |  |  | 9,646,885 |  |  |  | 9,683,771 |  |  |  | 9,703,255 |  |  |  | 9,721,958 |  |  |  | 9,781,495 |
Cumulative cash dividends declared per share during the fiscal year |  | $ | 0.81 |  |  | $ | 0.77 |  |  | $ | 0.93 |  |  | $ | 0.69 |  |  | $ | 0.65 |

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Item 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

The following Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) is intended to help a reader understand Value Line, its operations and business factors. The MD&A should be read in conjunction with Item 1, “Business”, and Item 1A, “Risk Factors” of Form 10-K, and in conjunction with the consolidated financial statements and the accompanying notes contained in Item 8 of this report.

The MD&A includes the following subsections:

| ● | Executive Summary of the Business

| ● | Results of Operations

| ● | Liquidity and Capital Resources

| ● | Recent Accounting Pronouncements

| ● | Critical Accounting Estimates and Policies

Executive Summary of the Business

The Company's core business is producing investment periodicals and their underlying research and making available certain Value Line copyrights, Value Line trademarks and Value Line Proprietary Ranking System results and other proprietary information, to third parties under written agreements for use in third-party managed and marketed investment products and for other purposes. Value Line markets under well-known brands including Value Line®, the Value Line logo®, The Value Line Investment Survey®, Smart Research, Smarter Investing™ and The Most Trusted Name in Investment Research®. The name "Value Line" as used to describe the Company, its products, and its subsidiaries, is a registered trademark of the Company. Effective December 23, 2010, EULAV Asset Management Trust (“EAM”) was established to provide the investment management services to the Value Line Funds, institutional and individual accounts and provide distribution, marketing, and administrative services to the Value Line® Mutual Funds ("Value Line Funds"). The Company maintains a significant investment in EAM from which it receives payments in respect of its non-voting revenues and non-voting profits interests.

The Company’s target audiences within the investment research field are individual investors, colleges, libraries, and investment management professionals. Individuals come to Value Line for complete research in one package. Institutional licensees consist of corporations, financial professionals, colleges, and municipal libraries. Libraries and universities offer the Company’s detailed research to their patrons and students. Investment management professionals use the research and historical information in their day-to-day businesses. The Company has a dedicated department that solicits institutional subscriptions.

Payments received for new and renewal subscriptions and the value of receivables for amounts billed to retail and institutional customers are recorded as unearned revenue until the order is fulfilled. As the orders are fulfilled, the Company recognizes revenue in equal installments over the life of the particular subscription. Accordingly, the subscription fees to be earned by fulfilling subscriptions after the date of a particular balance sheet are shown on that balance sheet as unearned revenue within current and long-term liabilities.

Prior to December 23, 2010, the Company’s businesses consolidated into two reportable business segments. The investment periodicals and related publications (retail and institutional) and Value Line copyrights and Value Line Proprietary Ranking System results and other proprietary information consolidate into one segment called Publishing and the investment management services to the Value Line Funds were consolidated into a second business segment called Investment Management. Subsequent to December 23, 2010, the Publishing segment constitutes the Company’s only reportable business segment.

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Asset Management and Mutual Fund Distribution Businesses

The Company completed the restructuring of its asset management and mutual fund distribution businesses (the “Restructuring Transaction”) on December 23, 2010 (the “Restructuring Date”) and executed the EAM Declaration of Trust (the “EAM Declaration of Trust”). Pursuant to the EAM Declaration of Trust, the Company received an interest in certain revenues of EAM and a portion of the residual profits of EAM but has no voting authority with respect to the election or removal of the trustees of EAM or control of its business.

The business of EAM is managed by its trustees each owning 20% of the voting profits interest in EAM and by its officers subject to the direction of the trustees. The Company’s non-voting revenues and non-voting profits interests in EAM entitle it to receive a range of 41% to 55% of EAM’s revenues (excluding distribution revenues) from EAM’s mutual fund and separate account business and 50% of the residual profits of EAM (subject to temporary increase in certain limited circumstances). The Voting Profits Interest Holders will receive the other 50% of residual profits of EAM. Distribution is not less than 90% of EAM’s profits payable each fiscal quarter under the provisions of the EAM Trust Agreement.

Business Environment

The long business expansion, which commenced more than a decade ago, came to a sudden and abrupt end earlier this year. That reversal was brought about by the fast-spreading and deadly COVID-19 pandemic. Thus far, COVID-19 has caused a reported four million infections in the U.S. and led to the deaths of well over 100,000 Americans.

Meanwhile, the disease also quickly wreaked havoc on the nation's economy, causing many businesses to close indefinitely or to operate at very low levels due to social distancing mandates. The consequent recession also resulted in the layoffs of more than 40 million workers. The nation's gross domestic product, meantime, contracted by 5% in the first quarter and a larger proportion in the second. In response to this crisis, the U.S. Government earlier passed and implemented massive fiscal stimulus programs, which helped to alleviate some of the more serious economic dislocations resulting from the pandemic. On the monetary side, the Federal Reserve (“Fed”) cut the federal funds rate target to near zero and initiated a massive program of asset purchases.

Not only did the long economic expansion grind to a halt, but so too did the historic bull market, which at its peak had seen the Dow Jones Industrial Average reach the doorstep of 30,000. Then, after that painful equity market reversal, investors, emboldened by the actions taken by Washington and the Fed, and cheered by the initial reopening of a majority of the country's businesses, regained their stride in April, May, and June, causing a V-shaped recovery in many market sectors, albeit not in the economy. At mid- summer, much of the late-winter damage to Wall Street had been reversed.

Now, the challenge will be for the economy to respond in kind. To be sure, markets often lead the economy by several months, so it is entirely possible, even likely, that business activity will respond affirmatively to the actions taken by Washington and the Fed and to reopening efforts. Thus far, in fact, some of the recent business data have been encouraging, with lesser declines seen in manufacturing and non-manufacturing and with the release of surprisingly good employment figures for May as well as a rebound in retail sales overall.

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Results of Operations for Fiscal Years 2020, 2019 and 2018

The following table illustrates the Company’s key components of revenues and expenses.

|  | Fiscal Years Ended April 30, |  |  | Change |
($ in thousands, except earnings per share) |  | 2020 |  |  | 2019 |  |  | 2018 |  |  | '20 vs. '19 |  |  | '19 vs. '18 |
Income from operations |  | $ | 9,090 |  |  | $ | 5,413 |  |  | $ | 2,572 |  |  |  | 67.9 | % |  |  | 110.5 | %
Non-voting revenues and non-voting profits interests from EAM Trust |  |  | 12,350 |  |  |  | 9,309 |  |  |  | 8,786 |  |  |  | 32.7 | % |  |  | 6.0 | %
Income from operations plus non-voting revenues and non-voting profits interests from EAM Trust |  |  | 21,440 |  |  |  | 14,722 |  |  |  | 11,358 |  |  |  | 45.6 | % |  |  | 29.6 | %
Operating expenses |  |  | 31,209 |  |  |  | 30,844 |  |  |  | 33,296 |  |  |  | 1.2 | % |  |  | -7.4 | %
Income from securities transactions, net |  |  | 44 |  |  |  | 504 |  |  |  | 540 |  |  |  | -91.3 | % |  |  | -6.7 | %
Income before income taxes |  | $ | 21,484 |  |  | $ | 15,226 |  |  | $ | 11,898 |  |  |  | 41.1 | % |  |  | 28.0 | %
Net income * |  | $ | 15,663 |  |  | $ | 11,150 |  |  | $ | 14,738 |  |  |  | 40.5 | % |  |  | -24.3 | %
Earnings per share |  | $ | 1.62 |  |  | $ | 1.15 |  |  | $ | 1.52 |  |  |  | 40.9 | % |  |  | -24.3 | %

*Net income in fiscal 2018 exceeded income before income taxes because the one-time tax adjustment from the Federal Income tax rate changes effective January 1, 2018 in our favor is actually larger than income tax provision for the fiscal year ended April 30, 2018.

During the twelve months ended April 30, 2020, the Company’s income from operations of $9,090,000 was $3,677,000 or 67.9% above income from operations of $5,413,000 during the twelve months ended April 30, 2019. During the twelve months ended April 30, 2020, there were 9,646,885 average common shares outstanding as compared to 9,683,771 average common shares outstanding during the twelve months ended April 30, 2019. For the twelve months ended April 30, 2020, operating expenses increased 1.2% above those during the twelve months ended April 30, 2019. During the twelve months ended April 30, 2020, the Company’s net income of $15,663,000, or $1.62 per share, was $4,513,000 or 40.5% above net income of $11,150,000, or $1.15 per share, for the twelve months ended April 30, 2019. The largest factors in the increases in net income and income from operations during the twelve months ended April 30, 2020, compared to the prior fiscal year were an increase in copyright fees, an increase from revenues and profits interests in EAM Trust and well controlled overall expenses.

During the three months ended April 30, 2020, the Company’s income from operations of $1,307,000 was 34.7% above income from operations of $970,000 during the three months ended April 30, 2019. During the three months ended April 30, 2020, the Company’s net income of $2,810,000, or $0.29 per share, was 22.5% above net income of $2,293,000, or $0.24 per share, for the three months ended April 30, 2019.

During the twelve months ended April 30, 2019, the Company’s income from operations of $5,413,000 was 110.5% above income from operations of $2,572,000 during the twelve months ended April 30, 2018. During the twelve months ended April 30, 2019, there were 9,683,771 average common shares outstanding as compared to 9,703,255 average common shares outstanding during the twelve months ended April 30, 2018. For the twelve months ended April 30, 2019, operating expenses were well controlled and decreased $2,452,000 or 7.4% below those during the twelve months ended April 30, 2018. During the twelve months ended April 30, 2019, the Company’s net income of $11,150,000, or $1.15 per share, was 24.3% below net income of $14,738,000, or $1.52 per share, for the twelve months ended April 30, 2018. The largest factor in the decrease in net income during the twelve months ended April 30, 2019, compared to the prior fiscal year was the January 1, 2018, reduction in the U.S. statutory federal corporate income tax rate from 35% to 21% resulting in a one-time deferred noncash tax benefit of $6,485,000 or 54.51% of pre-tax income during fiscal 2018.

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During the twelve months ended April 30, 2018, the Company’s net income of $14,738,000, or $1.52 per share, was $4,371,000 or 42.2% above net income of $10,367,000, or $1.07 per share, for the twelve months ended April 30, 2017 due to the fiscal 2018 reduction in the U.S. statutory federal corporate income tax rate from 35% to 21% on the Company’s long-term deferred tax liabilities, resulting in a tax benefit of 54.51% of pre-tax income for the twelve months ended April 30, 2018. The Company re-calculated its net deferred tax assets and liabilities using the Federal Tax Rate under the Tax Act. The effect of the re-calculation was reflected entirely in the third quarter ended January 31, 2018 (the period that included the enactment date) and was allocated directly to both current and deferred income tax expenses from continuing operations. Income from operations of $2,572,000 during the twelve months ended April 30, 2018 was $4,887,000 below income from operations of $7,459,000, which included a pre-tax gain of $8,123,000 from the sale of the Company's operating facility during the twelve months ended April 30, 2017 for which it received net proceeds of $11,555,000 on July 29, 2016 and additional depreciation and amortization expense of $3,498,000 in fiscal 2017.

Total o perating revenues

|  | Fiscal Years Ended April 30, |  |  | Change |
($ in thousands) |  | 2020 |  |  | 2019 |  |  | 2018 |  |  | '20 vs. '19 |  |  | '19 vs. '18 |
Investment periodicals and related publications: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Print |  | $ | 12,351 |  |  | $ | 13,339 |  |  | $ | 13,850 |  |  |  | -7.4 | % |  |  | -3.7 | %
Digital |  |  | 15,277 |  |  |  | 15,481 |  |  |  | 15,653 |  |  |  | -1.3 | % |  |  | -1.1 | %
Total investment periodicals and related publications |  |  | 27,628 |  |  |  | 28,820 |  |  |  | 29,503 |  |  |  | -4.1 | % |  |  | -2.3 | %
Copyright fees |  |  | 12,671 |  |  |  | 7,437 |  |  |  | 6,365 |  |  |  | 70.4 | % |  |  | 16.8 | %
Total operating revenues |  | $ | 40,299 |  |  | $ | 36,257 |  |  | $ | 35,868 |  |  |  | 11.1 | % |  |  | 1.1 | %

Within investment periodicals and related publications, subscription sales orders are derived from print and digital products. The following chart illustrates the changes in the sales orders associated with print and digital subscriptions.

Sources of s ubscription s ales

|  | Fiscal Years Ended April 30, |
|  | 2020 |  |  | 2019 |  |  | 2018 |
|  | Print |  |  | Digital |  |  | Print |  |  | Digital |  |  | Print |  |  | Digital |
New Sales |  |  | 10.0 | % |  |  | 15.8 | % |  |  | 13.4 | % |  |  | 13.3 | % |  |  | 15.5 | % |  |  | 15.2 | %
Renewal Sales |  |  | 90.0 | % |  |  | 84.2 | % |  |  | 86.6 | % |  |  | 86.7 | % |  |  | 84.5 | % |  |  | 84.8 | %
Total Gross Sales |  |  | 100.0 | % |  |  | 100.0 | % |  |  | 100.0 | % |  |  | 100.0 | % |  |  | 100.0 | % |  |  | 100.0 | %

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During the twelve months ended April 30, 2020 new sales of digital publications increased as a percent of the total gross digital sales versus the prior fiscal year due to an increase in new Institutional gross sales of digital publications. During the twelve months ended April 30, 2020 new sales of print publications decreased as a percent of the total gross print sales versus the prior fiscal year due to the timing of advertising.

During the twelve months ended April 30, 2019 conversion and renewal sales of print and digital publications increased as a percent of the total gross print and digital sales versus the prior fiscal year partly as a result of successful Advance Renewal campaigns executed in February 2018 and in November 2018 which brought in 4,080 orders and generated $1,394,000 in gross sales and due to increased efforts by our in-house Retail and Institutional Sales departments. During the twelve months ended April 30, 2019 new sales of print and digital publications decreased as a percent of the total gross print and digital sales versus the prior fiscal year due to a decrease in new gross sales of print and digital publications.

During twelve months ended April 30, 2018 new sales of print publications increased as a percent of the total gross print sales as a result of an increase in new print retail sales orders while conversion and renewal sales of print orders decreased from the prior fiscal year. New sales of digital publications slightly increased as a percent of the total gross digital sales as a result of an increase in new digital institutional sales orders. Conversion and renewal sales of digital services decreased as a percent of the total gross digital sales over the prior fiscal year.

|  | As of April 30, |  |  | Change |
($ in thousands) |  | 2020 |  |  | 2019 |  |  | 2018 |  |  | '20 vs. '19 |  |  | '19 vs. '18 |
Unearned subscription revenue (current and long-term liabilities) |  | $ | 24,738 |  |  | $ | 25,483 |  |  | $ | 25,525 |  |  |  | -2.9 | % |  |  | -0.2 | %

Unearned subscription revenue as of April 30, 2020 is 2.9% below April 30, 2019. A certain amount of variation is to be expected due to the volume of new orders and timing of renewal orders, direct mail campaigns and large Institutional Sales orders. The fourth quarter sales on the institutional side felt the effects of coronavirus recession and market volatility.

Investment periodicals and related publications revenues

Investment periodicals and related publications revenues of $27,628,000 (excluding Copyright fees), decreased 4.1% during the twelve months ended April 30, 2020, as compared to the prior fiscal year. The Company continued activity to attract new subscribers, primarily digital subscriptions through various marketing channels, primarily direct mail, e-mail, and by the efforts of our sales personnel. Total product line circulation at April 30, 2020 was 5.4% below total product line circulation at April 30, 2019. During the twelve months ended April 30, 2020 Institutional Sales department generated total sales orders of $13,566,000 and the retail telemarketing sales team generated total sales orders of $8,322,000.

Print publication revenues of $12,351,000, decreased 7.4%, during the twelve months ended April 30, 2020 as compared to the prior fiscal year as a result of a 6.1% decline in total print circulation in fiscal 2020. Total digital circulation at April 30, 2020 was 4.4% below total digital circulation at April 30, 2019, however, digital publications revenues of $15,277,000 during the twelve months ended April 30, 2020 were only 1.3 % below the prior fiscal year, as higher-priced subscriptions were generally retained.

Investment periodicals and related publications revenues of $28,820,000 decreased 2.3%, during the twelve months ended April 30, 2019, as compared to the prior fiscal year. Total product line circulation at April 30, 2019 was 2.4% below total product line circulation at April 30, 2018. During the twelve months ended April 30, 2019 Institutional Sales department generated total sales orders of $14,815,000 which is 2.3% above the prior fiscal year and the retail telemarketing sales team generated total sales orders of $8,946,000 which is 1% above the prior fiscal year.

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Total print circulation at April 30, 2019 was 3.0% below the total print circulation at April 30, 2018. Print publication revenues of $13,339,000 decreased 3.7% during the twelve months ended April 30, 2019 as compared to the prior fiscal year. Total digital circulation at April 30, 2019 was 1.6% below total digital circulation at April 30, 2018 and digital publications revenues of $15,481,000 during the twelve months ended April 30, 2019 were 1.1% below the prior fiscal year.

Investment periodicals and related publications revenues decreased $665,000, or 2.2%, for the twelve months ended April 30, 2018, as compared to fiscal 2017. Total product line circulation at April 30, 2018 was comparable to total product line circulation at April 30, 2017. Institutional Sales generated total sales orders of $14,487,000 for the twelve months ended April 30, 2018. The retail telemarketing sales team generated total sales orders of $8,872,000 for the twelve months ended April 30, 2018.

Value Line serves primarily individual and professional investors in stocks, who pay mostly on annual subscription plans, for basic services or as much as $100,000 or more annually for comprehensive premium quality research, not obtainable elsewhere. The ongoing goal of adding new subscribers has led us to experiment with varying terms for our reliable, proprietary research including periods of intensive promotion of “starter” services and publications. Further, new services and new features for existing services are regularly under consideration and development. Prominently introduced thus far in 2020 were new features in the Value Line Research Center, one of which is The New Value Line ETFs Service. A new monthly publication Value Line Information You Should Know Wealth Newsletter was introduced in January 2020, and features of the Value Line Research Center and The Value Line Fund Advisor Plus services were enhanced.

The Value Line Proprietary Ranking System results (the “Ranking System”), a component of the Company’s flagship product, The Value Line Investment Survey, is also utilized in the Company’s copyright business. The Ranking System is made available to EAM for specific uses without charge. The Ranking System is designed to be predictive over a six to twelve month period. During the six month period ended April 30, 2020, the combined Ranking System “Rank 1 & 2” stocks’ decrease of 10.4% compared to the Russell 2000 Index’s decrease of 16.1% during the comparable period. During the twelve month period ended April 30, 2020, the combined Ranking System “Rank 1 & 2” stocks’ decrease of 7.6% compared to the Russell 2000 Index’s decrease of 17.6% during the comparable period.

Copyright fees

During the twelve months ended April 30, 2020, copyright fees of $12,671,000 were 70.4% above those during the corresponding period in the prior fiscal year. The largest of the individual ETFs active under Value Line’s copyright program has again earned a five star overall Morningstar rating. The Company has negotiated with the sponsor of the largest exchange traded fund (“ETF”) in the program, the restructuring of the Company’s asset based fees and overall fees of the ETF in light of the competitive market. The Company’s copyright fees may be reduced in the range of ten percent, although the level of assets under management in the ETF will be critical to this projection.

During the twelve months ended April 30, 2019, copyright fees of $7,437,000 were 16.8% above those during the corresponding period in the prior fiscal year.

Investment management fees and services – (unconsolidated)

The Company has substantial non-voting revenues and non-voting profits interests in EAM, the asset manager to the Value Line Mutual Funds. Accordingly, the Company does not report this operation as a separate business segment, although it maintains a significant interest in the cash flows generated by this business and will receive ongoing payments in respect of its non-voting revenues and non-voting profits interests.

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Total assets in the Value Line Funds managed and/or distributed by EAM at April 30, 2020, were $3.58 billion, which is $485 million, or 15.7%, above total assets of $3.09 billion in the Value Line Funds managed and/or distributed by EAM at April 30, 2019. The increase reflects successful investment selection capturing market appreciation and positive net flows for the Value Line Funds, partially offset by net redemptions in nine of the eleven Funds over the twelve month period ended April 30, 2020.

Total assets in the Value Line Funds managed and/or distributed by EAM at April 30, 2019, were $3.09 billion, which is $610 million, or 24.6%, above total assets of $2.48 billion in the Value Line Funds managed and/or distributed by EAM at April 30, 2018.

Shares of Value Line Strategic Asset Management Trust (“SAM”) and Value Line Centurion Fund (“Centurion”) are only distributed within certain variable annuity and variable life insurance contracts issued by The Guardian Insurance & Annuity Company, Inc. (“GIAC”).

Sales and inflows for the Value Line Equity Funds during fiscal 2020 increased 109.1%, as compared to fiscal 2019. Sales and inflows for the Value Line Equity Funds during fiscal 2019 increased 169.2%, as compared to fiscal 2018 while Value Line Funds experienced net redemptions and the associated net asset outflows (redemptions less new sales) in fiscal 2018.

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The following table shows the change in assets for the past three fiscal years including sales (inflows), redemptions (outflows), dividends and capital gain distributions, and market value changes. Inflows for sales, and outflows for redemptions reflect decisions of individual investors. The table also illustrates the assets within the Value Line Funds broken down into equity funds, variable annuity funds and fixed income funds as of April 30, 2020, 2019 and 2018.

Value Line Mutual Funds

Total Net Assets |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
For the Years Ended April 30, |  | 2020 |  |  | 2019 |  |  | 2018 |  |  | 2020 |  |  | 2019 |
|  |  |  |  |  |  |  |  |  |  |  |  |  | vs. |  |  | vs. |
|  |  |  |  |  |  |  |  |  |  |  |  |  | 2019 |  |  | 2018 |
Value Line equity fund assets (excludes variable annuity)— beginning |  | $ | 2,582,416,326 |  |  | $ | 1,991,265,258 |  |  | $ | 1,877,029,899 |  |  |  | 29.7 | % |  |  | 6.1 | %
Sales/inflows |  |  | 1,516,434,399 |  |  |  | 710,828,252 |  |  |  | 264,010,632 |  |  |  | 113.3 | % |  |  | 169.2 | %
Dividends/Capital Gains Reinvested |  |  | 206,956,280 |  |  |  | 165,389,974 |  |  |  | 93,929,756 |  |  |  | 25.1 | % |  |  | 76.1 | %
Redemptions/outflows |  |  | (1,006,449,848 | ) |  |  | (461,981,970 | ) |  |  | (381,198,181 | ) |  |  | 117.9 | % |  |  | 21.2 | %
Dividend and Capital Gain Distributions |  |  | (214,033,328 | ) |  |  | (171,356,856 | ) |  |  | (97,598,435 | ) |  |  | 24.9 | % |  |  | 75.6 | %
Market value change |  |  | 22,225,964 |  |  |  | 348,271,669 |  |  |  | 235,091,588 |  |  |  | -93.6 | % |  |  | 48.1 | %
Value Line equity fund assets (non-variable annuity)— ending |  |  | 3,107,549,794 |  |  |  | 2,582,416,326 |  |  |  | 1,991,265,258 |  |  |  | 20.3 | % |  |  | 29.7 | %
Variable annuity fund assets — beginning |  | $ | 402,171,626 |  |  | $ | 378,970,470 |  |  | $ | 405,395,163 |  |  |  | 6.1 | % |  |  | -6.5 | %
Sales/inflows |  |  | 3,489,595 |  |  |  | 4,023,089 |  |  |  | 5,154,384 |  |  |  | -13.3 | % |  |  | -21.9 | %
Dividends/Capital Gains Reinvested |  |  | 34,384,214 |  |  |  | 29,440,239 |  |  |  | 23,241,352 |  |  |  | 16.8 | % |  |  | 26.7 | %
Redemptions/outflows |  |  | (50,911,955 | ) |  |  | (53,044,047 | ) |  |  | (59,902,699 | ) |  |  | -4.0 | % |  |  | -11.4 | %
Dividend and Capital Gain Distributions |  |  | (34,384,214 | ) |  |  | (29,440,239 | ) |  |  | (23,241,352 | ) |  |  | 16.8 | % |  |  | 26.7 | %
Market value change |  |  | 10,522,627 |  |  |  | 72,222,114 |  |  |  | 28,323,622 |  |  |  | -85.4 | % |  |  | 155.0 | %
Variable annuity fund assets — ending |  |  | 365,271,893 |  |  |  | 402,171,626 |  |  |  | 378,970,470 |  |  |  | -9.2 | % |  |  | 6.1 | %
Fixed income fund assets — beginning (1) |  | $ | 106,204,372 |  |  | $ | 110,860,197 |  |  | $ | 131,309,317 |  |  |  | -4.2 | % |  |  | -15.6 | %
Sales/inflows |  |  | 5,872,737 |  |  |  | 1,581,923 |  |  |  | 2,355,131 |  |  |  | 271.2 | % |  |  | -32.8 | %
Dividends/Capital Gains Reinvested |  |  | 2,247,503 |  |  |  | 2,337,429 |  |  |  | 2,565,532 |  |  |  | -3.8 | % |  |  | -8.9 | %
Redemptions/outflows |  |  | (13,556,768 | ) |  |  | (10,837,962 | ) |  |  | (22,403,260 | ) |  |  | 25.1 | % |  |  | -51.6 | %
Dividend and Capital Gain Distributions |  |  | (2,578,873 | ) |  |  | (2,743,543 | ) |  |  | (2,879,805 | ) |  |  | -6.0 | % |  |  | -4.7 | %
Market value change |  |  | 5,066,630 |  |  |  | 5,006,328 |  |  |  | (86,718 | ) |  |  | 1.2 | % |  |  | -5873.1 | %
Fixed income fund assets — ending |  |  | 103,255,601 |  |  |  | 106,204,372 |  |  |  | 110,860,197 |  |  |  | -2.8 | % |  |  | -4.2 | %
Assets under management — ending |  | $ | 3,576,077,288 |  |  | $ | 3,090,792,324 |  |  | $ | 2,481,095,925 |  |  |  | 15.7 | % |  |  | 24.6 | %

(1) In September 2018 Value Line Defensive Strategies Fund was liquidated

The Value Line Fund shareholders are provided a money market fund investment managed by Federated Government Obligations Fund.

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As of April 30, 2020 and April 30, 2019, five of six Value Line equity and hybrid mutual funds, excluding SAM and Centurion, held an overall four or five star rating by Morningstar, Inc.

Several of the Value Line Funds have received national recognition. The Value Line Asset Allocation Fund continues stellar performance as the top performing balanced fund of any allocation funds in Morningstar’s allocation categories. The Value Line Mid-Cap Focused Fund, the Value Line Small Cap Opportunities Fund and the Value Line Capital Appreciation Fund have been named “Category Kings” in The Wall Street Journal (“Journal”) in multiple months in recent years. In 2019 the Value Line Mid-Cap Focused Fund reached the Journal’s Winner’s Circle for U.S. equity funds.

EAM Trust - Results of operations before distribution to interest holders

The overall results of EAM’s investment management operations during the twelve months ended April 30, 2020, before interest holder distributions, included total investment management fees earned from the Value Line Funds of $21,985,000, 12b-1 fees and other fees of $8,436,000 and other net losses of $156,000. For the same period, total investment management fee waivers were $302,000 and 12b-1 fee waivers for three Value Line Funds were $667,000. During the twelve months ended April 30, 2020, EAM's net income was $2,332,000 after giving effect to Value Line’s non-voting revenues interest of $11,184,000, but before distributions to voting profits interest holders and to the Company in respect of its 50% non-voting profits interest.

The overall results of EAM’s investment management operations during the twelve months ended April 30, 2019, before interest holder distributions, included total investment management fees earned from the Value Line Funds of $16,715,000, 12b-1 fees and other fees of $6,811,000 and other income of $273,000. For the same period, total investment management fee waivers were $421,000 and 12b-1 fee waivers for three Value Line Funds were $654,000. During the twelve months ended April 30, 2019, EAM's net income was $2,098,000 after giving effect to Value Line’s non-voting revenues interest of $8,260,000, but before distributions to voting profits interest holders and to the Company in respect of its 50% non-voting profits interest.

The overall results of EAM’s investment management operations during the twelve months ended April 30, 2018, before interest holder distributions, included total investment management fees earned from the Value Line Funds of $15,988,000, 12b-1 fees and other fees of $6,455,000 and other income of $171,000 which included dividend, interest and licensing fees income. For the same period, total investment management fee waivers were approximately $487,000 and 12b-1 fee waivers for four Value Line Funds were approximately $754,000. During the twelve months ended April 30, 2018, EAM's net income was $1,492,000 after giving effect to Value Line’s non-voting revenues interest of $8,040,000, but before distributions to voting profits interest holders and to the Company in respect of its 50% non-voting profits interest.

As of April 30, 2020 and April 30, 2019, three of the Value Line Funds have all or a portion of the 12b-1 fees being waived, and one fund has partial investment management fee waivers in place. Although, under the terms of the EAM Declaration of Trust, the Company no longer receives or shares in the revenues from 12b-1 distribution fees, the Company could benefit from the fee waivers to the extent that the resulting reduction of expense ratios and enhancement of the performance of the Value Line Funds attracts new assets.

The Value Line equity and hybrid funds’ assets represent 86.7%, variable annuity funds issued by GIAC represent 10.4%, and fixed income fund assets represent 2.9%, respectively, of total fund assets under management (“AUM”) as of April 30, 2020. At April 30, 2020, equity, hybrid and GIAC variable annuities AUM increased by 16.3% and fixed income AUM decreased by 1.9% as compared to fiscal 2019.

The Value Line equity and hybrid funds’ assets represent 83.4%, variable annuity funds issued by GIAC represent 13.2%, and fixed income fund assets represent 3.4%, respectively, of total fund assets under management (“AUM”) as of April 30, 2019. At April 30, 2019, equity, hybrid and GIAC variable annuities AUM increased by 25.9% and fixed income AUM decreased by 4.5% as compared to fiscal 2018.

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EAM - The Company’s non-voting revenues and non-voting profits interests

The Company holds non-voting revenues and non-voting profits interests in EAM which entitle the Company to receive from EAM an amount ranging from 41% to 55% of EAM's investment management fee revenues from its mutual fund and separate accounts business, and 50% of EAM’s net profits, not less than 90% of which is distributed in cash every fiscal quarter. The applicable recent non-voting revenues interest percentage for the fourth quarter of fiscal 2020 was 51.51%.

The Company recorded income from its non-voting revenues interest and its non-voting profits interest in EAM as follows:

|  | Fiscal Years Ended April 30, |  |  | Change |
($ in thousands) |  | 2020 |  |  | 2019 |  |  | 2018 |  |  | '20 vs. '19 |  |  | '19 vs. '18 |
Non-voting revenues interest |  | $ | 11,184 |  |  | $ | 8,260 |  |  | $ | 8,040 |  |  |  | 35.4 | % |  |  | 2.7 | %
Non-voting profits interest |  |  | 1,166 |  |  |  | 1,049 |  |  |  | 746 |  |  |  | 11.2 | % |  |  | 40.6 | %
|  | $ | 12,350 |  |  | $ | 9,309 |  |  | $ | 8,786 |  |  |  | 32.7 | % |  |  | 6.0 | %

Operating e xpenses

|  | Fiscal Years Ended April 30, |  |  | Change |
($ in thousands) |  | 2020 |  |  | 2019 |  |  | 2018 |  |  | '20 vs. '19 |  |  | '19 vs. '18 |
Advertising and promotion |  | $ | 3,350 |  |  | $ | 3,406 |  |  | $ | 3,780 |  |  |  | -1.6 | % |  |  | -9.9 | %
Salaries and employee benefits |  |  | 18,189 |  |  |  | 17,781 |  |  |  | 18,488 |  |  |  | 2.3 | % |  |  | -3.8 | %
Production and distribution |  |  | 4,945 |  |  |  | 5,222 |  |  |  | 5,857 |  |  |  | -5.3 | % |  |  | -10.8 | %
Office and administration |  |  | 4,725 |  |  |  | 4,435 |  |  |  | 5,171 |  |  |  | 6.5 | % |  |  | -14.2 | %
Total expenses |  | $ | 31,209 |  |  | $ | 30,844 |  |  | $ | 33,296 |  |  |  | 1.2 | % |  |  | -7.4 | %

Expenses within the Company are categorized into advertising and promotion, salaries and employee benefits, production and distribution, office and administration.

Operating expenses of $31,209,000 during the twelve months ended April 30, 2020 were 1.2% above those during the twelve months ended April 30, 2019. Production and distribution expense categories decreased by 5.3% as a result of cost controls, decrease in printing and distribution costs, primarily a result of a 6.1% reduction in print circulation, and a decline in amortization of internally developed software during the twelve months ended April 30, 2020. Operating expenses of $8,492,000 during the three months ended April 30, 2020 were 3.4% above those during the three months ended April 30, 2019.

Operating expenses of $30,844,000 during the twelve months ended April 30, 2019 were 7.4% below those during the twelve months ended April 30, 2018. All major expense categories decreased as a result of cost controls and a decline in amortization of internally developed software during the twelve months ended April 30, 2019.

Operating expenses of $33,296,000 for the twelve months ended April 30, 2018 decreased $1,942,000, or 5.5%, as compared to the twelve months ended April 30, 2017 primarily due to a $3,498,000 decrease in depreciation and amortization expense partially offset by a $307,000 increase in advertising expenses and a $1,011,000 increase in salaries and employee benefits in fiscal 2018.

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Advertising and promotion

During twelve months ended April 30, 2020, advertising and promotion expenses of $3,350,000, decreased 1.6% as compared to the prior fiscal year. During the twelve months ended April 30, 2020, an increase in media marketing expenses and institutional sales promotion was offset by a 15.7% decrease in direct marketing expenses. In fiscal 2020 direct mail expenses decreased for all products except for The Value Line Investment Survey and The Value Line 600. During the twelve months ended April 30, 2020 sales commissions decreased 3.7% as compared to fiscal 2019.

During the twelve months ended April 30, 2019, advertising and promotion expenses of $3,406,000 decreased 9.9% as compared to the prior fiscal year. During the twelve months ended April 30, 2019, a $442,000 decrease in direct mail expenses for The Value Line Investment Survey and The Value Line 600 was partially offset by a $170,000 increase in media marketing expenses and institutional sales promotion. During the twelve months ended April 30, 2019 sales commissions decreased $60,000 as compared to fiscal 2018.

During the twelve months ended April 30, 2018, advertising and promotion expenses of $3,780,000 increased $307,000 above those of fiscal 2017 primarily due to a $249,000 increase in direct mail expenses and a $285,000 increase in media marketing expenses. Direct mail expenses of $1,256,000 during the twelve months ended April 30, 2018 increased above those of the prior fiscal year due to the increases in expenses for The Value Line Investment Survey, The Value Line 60 0, The Value Line Small and Mid-Cap and The Value Line Special Situations S ervice in fiscal 2018. During the twelve months ended April 30, 2018 sales commissions decreased $241,000 as compared to fiscal 2017 based on the structure of commission schedules and the mix of renewal and new sales.

Salaries and employee benefits

During the twelve months ended April 30, 2020, salaries and employee benefits of $18,189,000, increased 2.3% above the prior fiscal year due to a 47.0% increase in Profit Sharing employee retirement benefits during fiscal 2020 and a 10.2% increase in independent contractors’ costs over the prior year primarily in the Quantitative Research department. In fiscal 2020 salaries and employee benefits in the Information Technology department (“IT”) decreased 2.2% from the prior year reflecting completion of certain initiatives to upgrade operating systems.

During the twelve months ended April 30, 2019, salaries and employee benefits of $17,781,000 decreased 3.8% below the prior fiscal year primarily due to decreases in salaries and employee benefits in the Information Technology department (“IT”), reflecting completion of certain initiatives.

During the twelve months ended April 30, 2018 salaries and employee benefits of $18,488,000 increased $1,011,000 above those of fiscal 2017 primarily due to the increases in salaries and employee benefits in the Information Technology department (“IT”) related to the Company’s digital infrastructure and production processes and Quantitative Research departments.

During the twelve months ended April 30, 2020, 2019 and 2018, the Company recorded profit sharing expenses of $870,000, $592,000 and $496,000, respectively.

Production and distribution

During the twelve months ended April 30, 2020, production and distribution expenses of $4,945,000, decreased 5.3% below the prior fiscal year. During the twelve months ended April 30, 2020, a 1.8% decrease in overall expenses related to renegotiated production support of the Company’s website, maintenance of the Company’s publishing and application software and operating systems and a 56.3% decrease in amortization of internally developed software costs related to digital security and publication production software as compared to fiscal 2019. In fiscal 2020, printing and distribution costs decreased 9.8% due to a 6.1% decrease in print circulation during the twelve months ended April 30, 2020.

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During the twelve months ended April 30, 2019, production and distribution expenses of $5,222,000 decreased 10.8% below the prior fiscal year. During the twelve months ended April 30, 2019, a decrease of $719,000 was attributable to a decline in amortization of internally developed software costs related to digital security and publication production software. In fiscal 2019 distribution costs increased 2.8% due to a 2% increase in postal rates in January 2018 and 2% in January 2019.

During the twelve months ended April 30, 2018, production and distribution expenses of $5,857,000 decreased $3,206,000 below those of fiscal 2017. During the twelve months ended April 30, 2018, a decrease of $3,548,000 was attributable to a decline in amortization of internally developed software costs related to digital security and product production software. During the twelve months ended April 30, 2018, the decrease in production costs was partially offset by a $294,000 increase in production support of the Company’s website, maintenance of the Company’s publishing and application software and operating systems and web “framework”.

Office and administration

During the twelve months ended April 30, 2020, office and administrative expenses of $4,725,000, increased 6.5% above the prior fiscal year. The increase of $222,000 during the twelve months ended April 30, 2020 was a result of the operating lease amortization expense in fiscal 2020 due to a change in lease accounting standard ASU 2016-02,"Leases (Topic 842)".

During the twelve months ended April 30, 2019, office and administrative expenses of $4,435,000 decreased 14.2% below the prior fiscal year.

During the twelve months ended April 30, 2018, office and administrative expenses of $5,171,000, decreased $54,000 below those of fiscal 2017. During the twelve months ended April 30, 2018, a decrease in office and administrative expenses was primarily as a result of a $431,000 decrease in the cost of space rental due to lower rent payments resulting from the sub-lease agreement with ABM Industries, Incorporated (“ABM” or the “Sublandlord”). In accordance with GAAP, we allocated the benefit of the free rent period and other concessions over the term of our new NYC sublease, commenced on December 1, 2016. In fact, however, the Company did not pay cash rent for the new New York City office facility from December 2016 through October 2017. Additional decreases include $194,000 savings in real estate taxes due to the relocation of VLDC operations to a new downsized leased NJ facility upon the sale of the operating facility in July 2016 and relocation of the NYC office to a new smaller facility at 551 Fifth Ave., NY in February 2017. These savings in fiscal 2018 were partially offset by a $370,000 increase in professional fees above those of fiscal 2017.

Concentration

During the twelve months ended April 30, 2020, 31.4% of total publishing revenues of $40,299,000 were derived from a single customer. During the twelve months ended April 30, 2019, 20.5% of total publishing revenues of $36,257,000 were derived from a single customer. During the twelve months ended April 30, 2018, 17.7% of total publishing revenues of $35,868,000 were derived from a single customer.

Lease Commitments

On November 30, 2016, Value Line, Inc. received consent from the landlord at 551 Fifth Avenue, New York, NY to the terms of a new sublease agreement between Value Line, Inc. and ABM Industries, Incorporated commencing on December 1, 2016. Pursuant to the agreement Value Line leased from ABM 24,726 square feet of office space located on the second and third floors at 551 Fifth Avenue, New York, NY (“Building” or “Premises”) beginning on December 1, 2016 and ending on November 29, 2027. Base rent under the sublease agreement is $1,126,000 per annum during the first year with an annual increase in base rent of 2.25% scheduled for each subsequent year, payable in equal monthly installments on the first day of each month, subject to customary concessions in the Company’s favor and pass-through of certain increases in utility costs and real estate taxes over the base year. The Company provided a security deposit represented by a letter of credit in the amount of $469,000 in October 2016, which is scheduled to be reduced to $305,000 on September 30, 2021 and fully refunded after the sublease ends. This Building became the Company’s new corporate office facility. The Company is required to pay for certain operating expenses associated with the Premises as well as utilities supplied to the Premises. The sublease terms provide for a significant decrease (23% initially) in the Company’s annual rental expenditure taking into account free rent for the first six months of the sublease. Sublandlord provided Value Line a work allowance of $417,000 which accompanied with the six months free rent worth $563,000 was applied against the Company’s obligation to pay rent at our NYC headquarters, delaying the actual rent payments until November 2017.

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On February 29, 2016, the Company’s subsidiary VLDC and Seagis Property Group LP (the “Landlord”) entered into a lease agreement, pursuant to which VLDC has leased 24,110 square feet of warehouse and appurtenant office space located at 205 Chubb Ave., Lyndhurst, NJ (“Warehouse”) beginning on May 1, 2016 and ending on April 30, 2024 (“Lease”). Base rent under the Lease is $192,880 per annum payable in equal monthly installments on the first day of each month, in advance during fiscal 2017 and will gradually increase to $237,218 in fiscal 2024, subject to customary increases based on operating costs and real estate taxes. The Company provided a security deposit in cash in the amount of $32,146, which will be fully refunded after the lease term expires. The lease is a net lease requiring the Company to pay for certain operating expenses associated with the Warehouse as well as utilities supplied to the Warehouse.

Income from Securities Transactions, net

|  | Fiscal Years Ended April 30, |  |  | Change |
($ in thousands) |  | 2020 |  |  | 2019 |  |  | 2018 |  |  | '20 vs. '19 |  |  | '19 vs. '18 |
Dividend income |  | $ | 352 |  |  | $ | 257 |  |  | $ | 226 |  |  |  | 37.0 | % |  |  | 13.7 | %
Interest income |  |  | 279 |  |  |  | 201 |  |  |  | 103 |  |  |  | 38.8 | % |  |  | 95.1 | %
Capital gain distributions from ETFs |  |  | - |  |  |  | - |  |  |  | 152 |  |  |  | n/a |  |  |  | -100 | %
Capital gain/(loss) |  |  | (581 | ) |  |  | - |  |  |  | - |  |  |  | n/a |  |  |  | n/a |
Other |  |  | (6 | ) |  |  | 46 |  |  |  | 59 |  |  |  | -113.0 | % |  |  | -22.0 | %
Total income from securities transactions and other, net |  | $ | 44 |  |  | $ | 504 |  |  | $ | 540 |  |  |  | -91.3 | % |  |  | -6.7 | %

During the twelve months ended April 30, 2020 and April 30, 2019, the Company’s income from securities transactions, net, primarily derived from dividend and interest income mostly offset by realized losses on sales of securities held for sales in fiscal 2020, was $44,000 and $504,000, respectively. Proceeds from maturities and sales of government debt securities classified as available-for-sale during the twelve months ended April 30, 2020 and April 30, 2019, were $8,663,000 and $8,346,000, respectively. Proceeds from the sales of equity securities classified as available-for-sale during the twelve months ended April 30, 2020 were $4,387,000. Losses on the sales of equity securities classified as available-for-sale were reclassified from other comprehensive income in the Consolidated Balance Sheet in the amount of $581,000 during the twelve months ended April 30, 2020. There were no sales or proceeds from sales of equity securities during the twelve months ended April 30, 2019. There were no capital gain distributions from ETFs in fiscal 2020 or fiscal 2019.

During the twelve months ended April 30, 2019 and April 30, 2018, the Company’s income from securities transactions, net, primarily derived from dividend and interest income, was $504,000 and $540,000, respectively. Proceeds from maturities and sales of government debt securities classified as available-for-sale during the twelve months ended April 30, 2019 and April 30, 2018, were $8,346,000 and $3,384,000, respectively. There were no sales or proceeds from sales of equity securities during the twelve months ended April 30, 2019. Proceeds from sales of equity securities classified as available-for-sale were $152,000 that represent capital gain distributions from ETFs during the twelve months ended April 30, 2018.

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Effective income tax rate

The overall effective income tax rates, as a percentage of pre-tax ordinary income for the twelve months ended April 30, 2020, April 30, 2019 and April 30, 2018 were 27.09% 26.81% and (23.87%), respectively. Due to evolving state tax legislation, the Company's state and local effective income tax rate, net of Federal income tax benefit, increased from 6.02% of pretax income for the twelve months ended April 30, 2019, to 6.30% of pretax income for the twelve months ended April 30, 2020.

The overall change in the effective Federal tax rate during the twelve months ended April 30, 2019 and April 30, 2018 is primarily a result of the reduced Federal Tax Rate. In fiscal 2018 the U.S. statutory federal corporate income tax rate was reduced from 35% to 21%, which resulted in a tax benefit of 54.51% of pre-tax income for the twelve months ended April 30, 2018, primarily attributable to the effect on the long-term deferred tax liability. The Company re-calculated its net deferred tax assets and liabilities using the Federal Tax Rate under the Tax Act and allocated it directly to both current and deferred income tax expenses from continuing operations. In addition, due to evolving state tax legislation, the Company's state and local effective income tax rate, net of Federal income tax benefit, increased from 0.7% of pretax income for the twelve months ended April 30, 2018, to 6.02% of pretax income for the twelve months ended April 30, 2019.

Liquidity and Capital Resources

The Company had working capital, defined as current assets less current liabilities, of $13,700,000 as of April 30, 2020 and $6,014,000 as of April 30, 2019. These amounts include short-term unearned revenue of $18,854,000 and $20,008,000 reflected in total current liabilities at April 30, 2020 and April 30, 2019, respectively. Cash and short-term securities were $34,158,000 and $28,321,000 as of April 30, 2020 and April 30, 2019, respectively.

The Company’s cash and cash equivalents include $2,115,000 and $5,617,000 at April 30, 2020 and April 30, 2019, respectively, invested primarily in commercial banks and in Money Market Funds at brokers, which operate under Rule 2a-7 of the 1940 Act and invest primarily in short-term U.S. government securities.

Cash from operating activities

The Company had cash inflows from operating activities of $13,745,000 during the twelve months ended April 30, 2020 compared to cash inflows from operations of $11,494,000 and $9,907,000 during the twelve months ended April 30, 2019 and 2018, respectively. The increase in cash flows from fiscal 2019 to fiscal 2020 is primarily attributable to higher pre-tax income and an increase in cash receipts from copyright programs. The increase in cash inflows from fiscal 2018 to fiscal 2019 is primarily attributable to higher pre-tax income and a further decrease in the Federal income taxes, partially offset by prepayments to vendors and the timing of payments of invoices including rent at the Company’s NYC headquarters in fiscal 2019.

Cash from investing activities

The Company’s cash outflows from investing activities of $8,657,000 during the twelve months ended April 30, 2020 compared to cash outflows from investing activities of $2,972,000 for the twelve months ended April 30, 2019 and cash outflows from investing activities of $1,240,000 for the twelve months ended April 30, 2018. Cash outflows for the twelve months ended April 30, 2020 were higher than in fiscal 2019 primarily due to the Company’s decision to invest in additional equity and fixed income securities in fiscal 2020. Cash outflows for the twelve months ended April 30, 2019 were higher than in fiscal 2018 primarily due to the Company’s decision to invest in additional fixed income securities in fiscal 2019. Cash outflows for the twelve months ended April 30, 2018 included purchases of $408,000 for property and equipment.

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Cash from financing activities

During the twelve months ended April 30, 2020, the Company’s cash outflows from financing activities were $6,627,000 and compared to cash outflows from financing activities of $7,970,000 and $9,283,000 for the twelve months ended April 30, 2019 and 2018, respectively. Cash outflows for financing activities included $1,214,000, $608,000 and $354,000 for the repurchase of 46,840 shares, 28,059 shares and 20,045 shares of the Company’s common stock under the October 19, 2018 and the September 19, 2012 board approved common stock repurchase programs, during fiscal years 2020, 2019 and 2018, respectively. During fiscal 2020, the Company applied for and received an SBA loan under the Paycheck Protection Program in the amount of $2,331,000. Quarterly dividend payments of $0.20 per share during fiscal 2020 aggregated $7,724,000. Quarterly dividend payments of $0.19 per share during fiscal 2019 aggregated $7,362,000. Quarterly regular dividend payments of $0.18 per share during fiscal 2018 and a special dividend of $0.20 per share declared in January 2018 aggregated $8,929,000.

At April 30, 2020 there were 9,616,721 common shares outstanding as compared to 9,663,561 common shares outstanding at April 30, 2019. The Company expects financing activities to continue to include use of cash for dividend payments for the foreseeable future.

Management believes that the Company’s cash and other liquid asset resources used in its business together with the proceeds from the SBA loan and the future cash flows from operations and from the Company’s non-voting revenues and non-voting profits interests in EAM will be sufficient to finance current and forecasted liquidity needs for the next twelve months. Management does not anticipate making any additional borrowings during the next twelve months. As of April 30, 2020, retained earnings and liquid assets were $56,450,000 and $34,158,000, respectively. As of April 30, 2019, retained earnings and liquid assets were $48,598,000 and $28,321,000, respectively.

Seasonality

Our publishing revenues are comprised of subscriptions which are generally annual subscriptions. Our cash flows from operating activities are minimally seasonal in nature, primarily due to the timing of customer payments made for orders and subscription renewals.

Recent Accounting Pronouncements

In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842)”. This ASU requires that, for leases longer than one year, a lessee recognize in the statements of financial position a right-of-use asset, representing the right to use the underlying asset for the lease term, and a lease liability, representing the liability to make lease payments. It also requires that for finance leases, a lessee recognize interest expense on the lease liability, separately from the amortization of the right-of-use asset in the statements of earnings, while for operating leases, such amounts should be recognized as a combined expense. The Company adopted this ASU in May 2019 under a modified retrospective approach (see Note 9).

In August 2016, the FASB issued Accounting Standards Update No. 2016-15, Classification of Certain Cash Receipts and Cash Payments (a consensus of the Emerging Issues Task Force) (“ASU 2016-15”), effective for public business entities for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. The amendments in ASU 2016-15 address eight specific cash flow issues and apply to all entities that are required to present a statement of cash flows under ASC Topic 230, Statement of Cash Flows. The Company has adopted ASU 2016-15 in the first quarter of fiscal 2019.

The FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606)”, which requires an entity to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which it expects to be entitled in exchange for those goods or services. In addition, ASU No. 2014-09 requires disclosures of the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. ASU No. 2014-09 supersedes most existing U.S. GAAP revenue recognition principles, and it permits the use of either the retrospective or cumulative effect transition method. ASU No. 2014-09 is effective for annual reporting periods beginning after December 15, 2017, including interim periods within those annual periods. The Company has adopted ASU No. 2014-09 in the first quarter of fiscal 2019, which does not have a material impact on the Company's consolidated condensed financial statements and related disclosures.

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In November 2016, the FASB issued ASU No. 2016-18, "Statement of Cash Flows (Topic 230): Restricted Cash (a consensus of the FASB Emerging Issues Task Force)", effective for annual reporting periods beginning after December 15, 2017, including interim periods within those annual periods. This ASU requires that the reconciliation of the beginning-of-period and end-of-period amounts shown in the statement of cash flows include cash, cash equivalents and amounts generally described as restricted cash or restricted cash equivalents. The Company has adopted ASU No. 2016-18 in the first quarter of fiscal 2019, which does not have a material impact on the Company's consolidated condensed financial statements and related disclosures.

On June 21, 2018, the United States Supreme Court reversed the 1992 ruling in Quill, which protected firms delivering items by common carrier into a state where it had no physical presence from having to collect sales tax in such state. The Company has integrated the effects of the various state laws into its operations and continues to do so.

Critical Accounting Estimates and Policies

The Company prepares its consolidated financial statements in accordance with Generally Accepted Accounting Principles as in effect in the United States (U.S. “GAAP”). The preparation of these financial statements requires the Company to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses. The Company bases its estimates on historical experience and on various other assumptions that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent, and the Company evaluates its estimates on an ongoing basis. Actual results may differ from these estimates under different assumptions or

conditions. The Company believes the following critical accounting policies reflect the significant judgments and estimates used in the preparation of its Consolidated Financial Statements:

| ● | Revenue recognition

| ● | Income taxes

| ● | Valuation of EAM

Revenue Recognition

The majority of the Company’s revenues come from the sale of print and digital subscriptions and fees for copyright proprietary information. The Company recognizes subscription revenue, net of discounts, in equal amounts over the term of the subscription, which generally ranges from three months to one year or longer, varying based on the product or service. Copyright fees are calculated monthly based on market fluctuation and billed quarterly. The Company believes that the estimates related to revenue recognition are critical accounting estimates, and to the extent that there are material differences between its determination of revenues and actual results, its financial condition or results of operations may be affected.

Income Taxes

The Company’s effective annual income tax expense rate is based on the U.S. federal and state and local jurisdiction tax rates on income and losses that are part of its Consolidated Financial Statements. Tax-planning opportunities, non-taxable income, expenses that are not deductible in the Company’s tax returns, and the blend of business income, including income derived from the Company’s non-voting revenue and non-voting profits interests in EAM and income from securities transactions, will impact the effective tax rate in the jurisdictions in which the Company operates. Significant judgment is required in evaluating the Company’s tax positions.

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Tax law requires items to be included in the tax return at different times from when these items are reflected in the Company’s Consolidated Financial Statements. As a result, the effective tax rate reflected in the Company’s Consolidated Financial Statements is different from the tax rate reported on the Company’s tax returns (the Company’s cash tax rate). These differences reverse over time, such as depreciation and amortization expenses. These timing differences create deferred tax assets and liabilities. Deferred tax assets and liabilities are determined based on temporary differences between the financial reporting and the tax basis of assets and liabilities.

On December 22, 2017 H.R. 1, originally known as the Tax Cuts and Jobs Act (the "Tax Act"), was enacted. The Tax Act lowered the U.S. federal income tax rate ("Federal Tax Rate") from 35% to 21% effective January 1, 2018. Accordingly, the Company computes Federal income tax expense for the twelve months ended April 30, 2019 using the Federal Tax Rate of 21%, and computed its income tax expense for the twelve months ended April 30, 2018 using a blended Federal Income tax rate of 30.33%. The 21% Federal Tax Rate applies to the full fiscal year ending April 30, 2019 and each year thereafter.

In assessing the need for a valuation allowance, the Company considers both positive and negative evidence, including tax-planning strategies, projected future taxable income, and recent financial performance. If after future assessments of the realizability of the deferred tax assets the Company determines a lesser allowance is required, the Company would record a reduction to the income tax expense and to the valuation allowance in the period this determination was made. This would cause the Company’s income tax expense, effective tax rate, and net income to fluctuate.

In addition, the Company establishes reserves at the time that it determines that it is more likely than not that it will need to pay additional taxes related to certain matters. The Company adjusts these reserves, including any impact of the related interest and penalties, in light of changing facts and circumstances such as the progress of a tax audit. A number of years may elapse before a particular matter for which the Company has established a reserve is audited and finally resolved. The number of years with open tax audits varies depending on the tax jurisdiction. Such liabilities are recorded as income taxes payable in the Company’s Consolidated Balance Sheets. The settlement of any particular issue would usually require the use of cash. Favorable resolutions of tax matters for which the Company has previously established reserves are recognized as a reduction to the Company’s income tax expense when the amounts involved become known.

Assessing the future tax consequences of events that have been recognized in the Company’s financial statements or tax returns requires judgment. Variations in the actual outcome of these future tax consequences could materially impact the Company’s financial position, results of operations, or cash flows.

Investment in EAM Trust

The Company accounts for its investment in EAM using the equity method of accounting. The value of its investment in EAM is the fair value of the contributed capital at inception, plus the Company’s share of non-voting revenues and non-voting profits from EAM, less distributions received from EAM. The Company evaluates its investment in EAM on a regular basis for other-than-temporary impairment, which requires significant judgment and includes quantitative and qualitative analysis of identified events or circumstances that impact the fair value of the investment.

Should the fair value of the investment fall below its carrying value, the Company will determine whether the investment is other-than-temporarily impaired, which includes assessing the severity and duration of the impairment and the likelihood of recovery. If the investment is considered to be other-than-temporarily impaired, the Company will write down the investment to its fair value. Since the inception of EAM, the Company has not recognized any other-than-temporary impairment in the investment.

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Off-Balance Sheet Arrangements

We are not a party to any off-balance sheet arrangements, other than operating leases and a secured Letter of Credit (“LOC”) in the amount of $469,000 issued as a security deposit for the Company’s office facility entered into in the ordinary course of business. The LOC is secured by a restricted Money Market Investment of similar amount.

Contractual Obligations

Below is a summary of certain contractual obligations of the Company as of April 30, 2020 ($ in thousands):

|  | Payments due by period |  |  |  |  |  |  |  |  |
Contractual Obligations |  | Total |  |  | Less than 1 year |  |  | 1-3 years |  |  | 3-5 years |  |  | More than 5 years |
Loan Obligations |  | $ | 2,331 |  |  | $ | 194 |  |  | $ | 2,137 |  |  | $ | - |  |  | $ | - |
Operating Lease Obligations |  |  | 11,435 |  |  |  | 1,432 |  |  |  | 3,103 |  |  |  | 3,062 |  |  |  | 3,838 |
Total |  | $ | 13,766 |  |  | $ | 1,626 |  |  | $ | 5,240 |  |  | $ | 3,062 |  |  | $ | 3,838 |

Item 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Market Risk Disclosures

The Company’s Consolidated Balance Sheet includes a substantial amount of assets whose fair values are subject to market risks. The Company’s market risks are primarily associated with interest rates and equity price risk. The following sections address the significant market risks associated with the Company’s investment activities.

Interest Rate Risk

The Company’s strategy has been to acquire debt securities with low credit risk. Despite this strategy management recognizes and accepts the possibility that losses may occur. To limit the price fluctuation in these securities from interest rate changes, the Company’s management invests primarily in short-term obligations maturing within one year.

The fair values of the Company’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.

Fixed income securities consist of Bank certificates of deposits and securities issued by the federal government within the United States. As of April 30, 2020 the aggregate cost and fair value of fixed income securities classified as available-for-sale were $14,902,000 and $15,079,000, respectively. As of April 30, 2019 the aggregate cost and fair value of fixed income securities classified as available-for-sale were $11,163,000 and $11,206,000, respectively.

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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.

Fixed Income Securities

|  |  |  |  |  | Estimated Fair Value after Hypothetical Change in Interest Rates |
|  |  |  |  |  | (in thousands) |
|  |  |  |  |  | (bp = basis points) |
|  |  |  |  |  | 1 year |  |  | 1 year |  |  | 1 year |  |  | 1 year |
|  | Fair |  |  | 50 bp |  |  | 50 bp |  |  | 100 bp |  |  | 100 bp |
|  | Value |  |  | increase |  |  | decrease |  |  | increase |  |  | decrease |
As of April 30, 2020 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Investments in securities with fixed maturities |  | $ | 15,079 |  |  | $ | 15,058 |  |  | $ | 15,179 |  |  | $ | 14,998 |  |  | $ | 15,240 |
As of April 30, 2019 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Investments in securities with fixed maturities |  | $ | 11,206 |  |  | $ | 11,476 |  |  | $ | 11,446 |  |  | $ | 11,493 |  |  | $ | 11,451 |

Management regularly monitors the maturity structure of the Company’s investments in debt securities in order to maintain an acceptable price risk associated with changes in interest rates.

Equity Price Risk

The carrying values of investments subject to equity price risks are based on quoted market prices 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 issuer, 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.

The Company’s equity investment strategy has been to acquire equity securities across a diversity of industry groups. The portfolio consists of ETFs held for dividend yield that attempt to replicate the performance of certain equity indexes and ETFs that hold preferred shares primarily of financial institutions. In order to maintain liquidity in these securities, the Company’s policy has been to invest in and hold in its portfolio, no more than 5% of the approximate average daily trading volume in any one issue.

As of April 30, 2020 and April 30, 2019, the aggregate cost of the equity securities classified as available-for-sale, which consist of investments in the SPDR Series Trust S&P Dividend ETF (SDY), First Trust Value Line Dividend Index ETF (FVD), PowerShares Financial Preferred ETF (PGF), Select Utilities Select Sector SPDR ETF (XLU), First Trust Value Line 100 ETF (FVL), ProShares Trust S&P 500 Dividend Aristocrats ETF (NOBL), SPDR S&P 500 ETF (SPY) and iShares Select Dividend ETF (DVY) and equity securities portfolio under EAM management held at Charles Schwab was $12,877,000 and $8,541,000, respectively, and the fair value was $14,125,000 and $10,622,000, respectively.

Equity Securities |  |  |  |  |  |  |  | Estimated Fair Value after |  |  | Hypothetical Percentage |
|  |  |  |  |  | Hypothetical |  | Hypothetical |  |  | Increase (Decrease) in |
($ in thousands) |  |  | Fair Value |  | Price Change |  | Change in Prices |  |  | Shareholders’ Equity |
As of April 30, 2020 | Equity Securities and ETFs held for dividend yield |  | $ | 14,125 |  | 30% increase |  | $ | 18,363 |  |  |  | 6.25 | %
|  |  |  |  |  | 30% decrease |  | $ | 9,888 |  |  |  | -6.25 | %

Equity Securities |  |  |  |  |  |  |  | Estimated Fair Value after |  |  | Hypothetical Percentage |
|  |  |  |  |  | Hypothetical |  | Hypothetical |  |  | Increase (Decrease) in |
($ in thousands) |  |  | Fair Value |  | Price Change |  | Change in Prices |  |  | Shareholders’ Equity |
As of April 30, 2019 | Equity Securities and ETFs held for dividend yield |  | $ | 10,622 |  | 30% increase |  | $ | 13,809 |  |  |  | 5.30 | %
|  |  |  |  |  | 30% decrease |  | $ | 7,436 |  |  |  | -5.30 | %

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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 10-K:

| Page Number
Report of independent auditors | 53
Consolidated balance sheets at April 30, 2020 and 2019 | 54
Consolidated statements of income for the fiscal years ended April 30, 2020, 2019 and 2018 | 55
Consolidated statements of comprehensive income for the fiscal years ended April 30, 2020, 2019 and 2018 | 56
Consolidated statements of cash flows for the fiscal years ended April 30, 2020, 2019 and 2018 | 57
Consolidated statement of changes in shareholders’ equity for the fiscal years ended April 30, 2020, 2019 and 2018 | 58
Notes to the consolidated financial statements | 59

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Quarterly Results (Unaudited)

($ in thousands, except per share amounts)

|  | Net Revenues |  |  | Income/ (Loss) from Operations |  |  | Revenues and Profits Interests in EAM Trust |  |  | Income/ (Loss) From Securities Trans. and Other, net |  |  | Net Income |  |  | Earnings Per Share |
2020, by Quarter |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
First |  | $ | 9,617 |  |  | $ | 2,025 |  |  | $ | 2,871 |  |  | $ | 141 |  |  | $ | 3,690 |  |  | $ | 0.38 |
Second |  |  | 10,080 |  |  |  | 2,629 |  |  |  | 3,058 |  |  |  | 143 |  |  |  | 4,211 |  |  |  | 0.44 |
Third |  |  | 10,803 |  |  |  | 3,129 |  |  |  | 3,455 |  |  |  | 167 |  |  |  | 4,952 |  |  |  | 0.51 |
Fourth * |  |  | 9,799 |  |  |  | 1,307 |  |  |  | 2,966 |  |  |  | (407 | ) |  |  | 2,810 |  |  |  | 0.29 |
Total |  | $ | 40,299 |  |  | $ | 9,090 |  |  | $ | 12,350 |  |  | $ | 44 |  |  | $ | 15,663 |  |  | $ | 1.62 |
2019, by Quarter |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
First |  | $ | 8,971 |  |  | $ | 1,270 |  |  | $ | 2,271 |  |  | $ | 114 |  |  | $ | 3,104 |  |  | $ | 0.32 |
Second |  |  | 9,051 |  |  |  | 1,760 |  |  |  | 2,384 |  |  |  | 123 |  |  |  | 3,302 |  |  |  | 0.34 |
Third |  |  | 9,052 |  |  |  | 1,413 |  |  |  | 2,210 |  |  |  | 140 |  |  |  | 2,451 |  |  |  | 0.25 |
Fourth |  |  | 9,183 |  |  |  | 970 |  |  |  | 2,444 |  |  |  | 127 |  |  |  | 2,293 |  |  |  | 0.24 |
Total |  | $ | 36,257 |  |  | $ | 5,413 |  |  | $ | 9,309 |  |  | $ | 504 |  |  | $ | 11,150 |  |  | $ | 1.15 |
2018, by Quarter |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
First |  | $ | 8,914 |  |  | $ | 1,165 |  |  | $ | 2,136 |  |  | $ | 96 |  |  | $ | 2,215 |  |  | $ | 0.23 |
Second |  |  | 8,989 |  |  |  | 808 |  |  |  | 2,237 |  |  |  | 91 |  |  |  | 2,072 |  |  |  | 0.21 |
Third * |  |  | 9,094 |  |  |  | 787 |  |  |  | 2,284 |  |  |  | 258 |  |  |  | 8,996 |  |  |  | 0.93 |
Fourth * |  |  | 8,871 |  |  |  | (188 | ) |  |  | 2,129 |  |  |  | 95 |  |  |  | 1,455 |  |  |  | 0.15 |
Total |  | $ | 35,868 |  |  | $ | 2,572 |  |  | $ | 8,786 |  |  | $ | 540 |  |  | $ | 14,738 |  |  | $ | 1.52 |

* During the fourth quarter of fiscal 2020, the company recognized $581,000 of capital losses on securities available for sale. During the third quarter ended January 31, 2018 the net income of $8,996,000 included deferred tax benefit of $6,485,000 as a result of a decrease in the Federal income taxes due to the Federal tax rate change in fiscal 2018. During the fourth quarter ended April 30, 2018, the Company’s loss from operations of $188,000 was the result of an increase in professional fees and to a lesser extent a decrease in digital publications revenues.

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Item 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.

None.

Item 9A. CONTROLS AND PROCEDURES.

(a) Evaluation of Disclosure Controls and Procedures.

The Company's Chief Executive Officer and Vice President & Treasurer carried out an evaluation of the effectiveness of the Company's "disclosure controls and procedures" (as defined in the Securities Exchange Act of 1934 (the “Exchange Act”) Rules 13a-15(e) or 15d-15(e)) as of April 30, 2020, as required by paragraph (b) of Exchange Act Rules 13a-15 or 15d-15. The Company’s Chief Executive Officer and Vice President & Treasurer are engaged in a comprehensive effort to review, evaluate and improve the Company's controls; however, management does not expect that the Company's disclosure controls or its internal controls over financial reporting can prevent all possible errors and fraud.

The Company maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in the Company’s reports filed with the SEC is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to the Company’s management, including its Chief Executive Officer and Vice President & Treasurer, as appropriate, to allow timely decisions regarding required disclosure.

The Company’s management has evaluated, with the participation of the Company’s Chief Executive Officer and, the effectiveness of the Company’s disclosure controls and procedures as of the end of the period covered by this report. Based on that evaluation, the Chief Executive Officer and Vice President & Treasurer have concluded that the Company’s disclosure controls and procedures were effective as of the end of the period covered by this report.

This Form 10-K does not include an attestation report of the Company's registered public accounting firm regarding the Company’s internal control over financial reporting. Under applicable SEC rules, no such attestation report by the Company's registered public accounting firm is required.

Changes in Internal Controls

In the course of the evaluation of disclosure controls and procedures, the Chief Executive Officer and Vice President & Treasurer considered certain internal control areas in which the Company has made and is continuing to make changes to improve and enhance controls. Based upon that evaluation, the Chief Executive Officer and Vice President & Treasurer of the Company concluded that there were no changes in the Company's internal control over financial reporting identified in connection with the evaluation required by paragraph (d) of Exchange Act Rules 13a-15 or 15d-15 that occurred during the fourth quarter of fiscal 2020 that have materially affected, or are reasonably likely to materially affect, the Company's internal controls over financial reporting.

(b) Management’s Annual Report on Internal Control over Financial Reporting.

The Company’s management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rule 13a-15(f) under the Exchange Act. Internal control over financial reporting is a process designed by, or under the supervision of, the Company’s principal executive and principal financial officers, and effected by the board of directors, management, and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. GAAP including those policies and procedures that: (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company, (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with U.S. GAAP and that receipts and expenditures are being made only in accordance with authorizations of management and directors of the Company, and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the Company’s assets that could have a material effect on the financial statements.

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Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with policies and procedures may deteriorate.

Under the supervision and with the participation of management, including the Chief Executive Officer and the Vice President & Treasurer, acting as Principal Financial Officer, the Company has assessed the effectiveness of its internal control over financial reporting as of April 30, 2019. In making this assessment, management used the criteria described in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Based on this assessment and those criteria, management concluded that the Company did maintain effective internal control over financial reporting as of April 30, 2020.

Changes in Internal Control over Financial Reporting

There have been no changes in the Company’s internal control over financial reporting during the fourth quarter of fiscal 2020 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Item 9B. OTHER INFORMATION.

None.

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Part III

Item 10. DIRECTORS, EXECUTIVE OFFICERS, AND CORPORATE GOVERNANCE.

(a) Names of Directors, Age as of June 30, 2020 and Principal Occupation | Director Since
Howard A. Brecher* (66). Chairman and Chief Executive Officer of the Company since October 2011; Acting Chairman and Acting Chief Executive Officer of the Company from November 2009 until October 2011; Chief Legal Officer of the Company from prior to 2005 to the present; Vice President and Secretary of the Value Line Funds from June 2008 until December 2010; Secretary of EAM LLC from February 2009 until December 2010; Director and General Counsel of AB&Co., Inc. from prior to 2005 to the present. Mr. Brecher has been an officer of the Company for more than 25 years. In addition to his current roles with the Company, he has also served as Secretary of the Company and as a senior officer of significant affiliates of the Company. Mr. Brecher is a graduate of Harvard College, Harvard Business School and Harvard Law School. He also holds a Master’s Degree in tax law from New York University. | 1992
Stephen P. Davis (68). Retired Deputy Commissioner, New York City Police Department (“NYPD”), from 2014 to 2018. Managing Member, Davis Investigative Group, LLC from 2001 to 2013, and since April, 2018. Mr. Davis served as a senior appointed official in the NYPD from which he retired in 1992 as a uniformed senior officer. He has successfully managed his own business serving the financial services industry and other clients for more than 13 years. | 2010
Alfred R. Fiore (64). Retired Chief of Police, Westport, CT from 2004 to 2011. Mr. Fiore served as the senior official of a municipal department with both executive and budget responsibilities. He was Chief of Police, Westport, CT for seven years and was a member of that Police Department for more than 33 years. | 2010
Glenn J. Muenzer (62). Special Agent (Retired), Federal Bureau of Investigation (the “FBI”) from 1991 to 2012. Mr. Muenzer is an accomplished law enforcement professional with extensive law enforcement and financial investigative experience. Prior to joining the FBI, Mr. Muenzer was Vice President and Manager of Internal Audit at Thomson McKinnon Securities, Inc.; Assistant Vice President of Internal Audit at EF Hutton; Senior Auditor with Deloitte. Mr. Muenzer is a Certified Public Accountant and Certified in Financial Forensics. | 2012
Stephen R. Anastasio* (61). Vice President of the Company since December 2010; Treasurer since September 2005 and Director since February 2010. Mr. Anastasio has been employed by Value Line, Inc. for more than 30 years. In addition to his current roles with the Company, he has served as Chief Financial Officer, Treasurer, Chief Accounting Officer and Corporate Controller of the Company. Mr. Anastasio is a graduate of Fairleigh Dickinson University and is a Certified Public Accountant. | 2010
Mary Bernstein* (70). Director of Accounting of the Company since 2010; Accounting Manager of the Company from 2000 to 2010. Mrs. Bernstein holds an MBA Degree in accounting from Baruch College of CUNY and is a Certified Public Accountant. Mrs. Bernstein has been employed by Value Line, Inc. for more than 20 years. | 2010

* Member of the Executive Committee of the Board of Directors.

Except as noted, the directors have held their respective positions for at least five years. Information about the experience, qualifications, attributes and skills of the directors is incorporated by reference from the section entitled "Director Qualifications" in the Company's Proxy Statement for the 2020 Annual Meeting of Shareholders.

| (b) | The information pertaining to executive officers of the Company is set forth in Part I, Item I, subsection J under the caption "Executive Officers of the Registrant" of this Form 10-K.

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Audit Committee

The Company has a standing Audit Committee performing the functions described in Section 3(a) (58) (A) of the Securities Exchange Act of 1934, the members of which are: Mr. Glenn Muenzer, Mr. Stephen Davis, and Mr. Alfred Fiore. Mr. Muenzer, a qualified financial expert, was elected Chairman of the Audit Committee in 2012. The Board of Directors have determined that Mr. Muenzer is an “audit committee financial expert” (as defined in the rules and regulations of the SEC). 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’s financial sophistication requirements for audit committee members.

Code of Ethics

The Company’s Code of Business Conduct and Ethics that applies to its principal executive officer, principal financial officer, all other officers, and all other employees is available on the Company’s website at www.valueline.com/About/Code of Ethics.aspx.

Procedures for Shareholders to Nominate Directors

There have been no material changes to the procedures by which shareholders of the Company may recommend nominees to the Company's Board of Directors.

Section 16(a) Beneficial Ownership Reporting Compliance

Section 16(a) of the Securities Exchange Act of 1934 requires the Company's executive officers and directors, and persons who own more than ten percent of a registered class of the Company’s equity securities, to file reports of ownership and changes in ownership with the SEC on Forms 3, 4 and 5. Executive officers, directors and greater than ten percent shareholders are required by SEC regulations to furnish the Company with copies of all Forms 3, 4 and 5 they file.

Based on the Company's review of the copies of such forms that it has received and written representations from certain reporting persons confirming that they were not required to file Forms 5 for the fiscal year ended April 30, 2020, the Company believes that all its executive officers, directors and greater than ten percent shareholders complied with applicable SEC filing requirements during fiscal 2020.

Item 11. EXECUTIVE COMPENSATION.

The information required in response to this Item 11, Executive Compensation, is incorporated by reference from the section entitled “Compensation of Directors and Executive Officers” in the Company’s Proxy Statement for the 2020 Annual Meeting of Shareholders.

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Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS.

The following table sets forth information as of April 30, 2020 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.

Name and Address of Beneficial Owner | Number of Shares Beneficially Owned | Percentage of Shares Beneficially Owned
Arnold Bernhard & Co., Inc.* | 8,633,733 | 89.78%
551 Fifth Avenue |  |
New York, NY 10176 |  |

*All of the outstanding voting stock of Arnold Bernhard & Co., Inc. is owned by Jean B. Buttner.

The following table sets forth information as of April 30, 2020, 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 executive officers and directors as a group.

Name and Address of Beneficial Owner | Number of Shares Beneficially Owned | Percentage of Shares Beneficially Owned
Howard A. Brecher | 1,400 | *
Stephen R. Anastasio | 1,000 | *
Glenn J. Muenzer | 300 | *
Stephen P. Davis | 200 | *
Alfred R. Fiore | 350 | *
Mary Bernstein | 200 | *
All directors and executive officers as a group (6 persons) | 3,450 | *

* Less than one percent

Securities Authorized for Issuance under Equity Compensation Plans

There are no securities of the Company authorized for issuance under equity compensation plans.

Item 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE.

AB&Co., which owns 89.78% of the outstanding shares of the Company’s common stock as of April 30, 2020, utilizes the services of officers and employees of the Company to the extent necessary to conduct its business. The Company and AB&Co. allocate costs for office space, equipment and supplies and shared staff pursuant to a servicing and reimbursement agreement. During the fiscal years ended April 30, 2020 and April 30, 2019, the Company was reimbursed $388,000 and $384,000, respectively for payments it made on behalf of and services it provided to AB&Co. There were no receivables due from the Parent at April 30, 2020 or April 30, 2019. In addition, a tax-sharing arrangement allocates the tax liabilities of the two companies between them. The Company is included in the consolidated federal income tax return filed by AB&Co. The Company pays to AB&Co. an amount equal to the Company's liability as if it filed a separate federal income tax return. For the years ended April 30, 2020 and 2019, the Company made payments to AB&Co. for federal income taxes amounting to $3,325,000 and $2,700,000, respectively.

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The Company holds non-voting revenues and non-voting profits interests in EAM which entitle the Company to receive from EAM an amount ranging from 41% to 55% of EAM's investment management fee revenues from the Value Line Mutual Funds and separate accounts business, and 50% of EAM’s net profits. EAM currently has no separately managed account clients.

During the twelve months ended April 30, 2020 and April 30, 2019, the Company recorded revenues of $12,350,000 and $9,309,000, respectively, consisting of $11,184,000 and $8,260,000, from its non-voting revenues interest in EAM and $1,166,000 and $1,049,000, from its non-voting profits interest in EAM without incurring any directly related expenses. During the twelve months ended April 30, 2018, the Company recorded revenues of $8,786,000, consisting of $8,040,000, from its non-voting revenues interest in EAM and $746,000, from its non-voting profits interest in EAM.

Included in the Company’s Investment in EAM Trust are receivables due from EAM of $2,949,000 and $2,420,000 at April 30, 2020 and April 30, 2019, respectively, for the unpaid portion of Value Line’s non-voting revenues and non-voting profits interests. The non-voting revenues and non-voting profits interests due from EAM are payable to Value Line quarterly under the provisions of the EAM Declaration of Trust.

The Company has adopted a written Related Party Transactions Policy as part of its Code of Business Conduct and Ethics. This policy requires that any related party transaction which would be required to be disclosed under Item 404(a) of Regulation S-K must be approved or ratified by the Audit Committee of the Board of Directors. Transactions covered for the fiscal year ended April 30, 2020 include the matters described in the preceding paragraphs of this Item 13.

Director Independence

The information required with respect to director independence and related matters are incorporated by reference from the section entitled “Compensation of Directors and Executive Officers” in the Company’s Proxy Statement for the 2020 Annual Meeting of Shareholders.

Item 14. PRINCIPAL ACCOUNTING FEES AND SERVICES.

Audit and Non-Audit Fees

The following table illustrates the fees paid to the Company’s independent auditor, Horowitz & Ullmann P.C., for services provided:

|  | Fiscal Years Ended April 30, |
|  | 2020 |  |  | 2019 |  |  | 2018 |
Audit fees |  | $ | 157,485 |  |  | $ | 151,000 |  |  | $ | 151,000 |
Audit-related fees |  |  | 18,660 |  |  |  | 4,240 |  |  |  | 5,960 |
Tax related fees |  |  | 116,320 |  |  |  | 170,115 |  |  |  | 132,550 |
Total |  | $ | 292,465 |  |  | $ | 325,355 |  |  | $ | 289,510 |

In the above table, in accordance with the SEC's definitions and rules, “audit fees” are fees the Company paid Horowitz & Ullmann, P.C. for professional services for the audit of the Company's consolidated financial statements for the fiscal years ended April 30, 2020 and 2019 included in Form 10-K and the review of consolidated condensed financial statements and included in Form 10-Qs and for services that are normally provided by the accountant in connection with statutory and regulatory filings or engagements; “audit-related fees” are fees for assurance and related services that are reasonably related to the performance of the audit or review of the Company's consolidated financial statements; and “tax fees” are fees for tax compliance, tax advice and tax planning.

48

Audit Committee Pre-Approval Policies and Procedures

The Audit Committee of the Company's Board of Directors approves all services provided by Horowitz & Ullmann, P.C., prior to the provision of those services. The Audit Committee has not adopted any specific pre-approval policies and procedures.

Part IV

Item 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.

| (a) (1) | Financial Statements - See Part II Item 8.

All other Schedules are omitted because they are not applicable or the required information is shown in the financial statements or notes thereto.

| (b) | Exhibits

| 3.1 | Certificate of Incorporation of the Company, as amended through April 7, 1983, is incorporated by reference to Exhibit 3.1 to the Registration Statement on Form S-1 of Value Line, Inc. filed with the SEC on April 7, 1983.

| 3.2 | Certificate of Amendment of Certificate of Incorporation dated October 24, 1989 is incorporated by reference to Exhibit 3.2 to the Amended Annual Report on Form 10-K/A for the year ended April 30, 2008 filed with the SEC on June 8, 2009.

| 3.3 | By-laws of the Company, as amended through January 18, 1996, are incorporated by reference to Exhibit 99. (A) 3 to the Amended Quarterly Report on Form 10-Q/A for the quarter ended January 31, 1996 filed with the SEC on March 19, 1996.

| 10.1 | Form of tax allocation arrangement between the Company and AB&Co., Inc. is incorporated by reference to Exhibit 10.8 to the Registration Statement on Form S-1 of Value Line, Inc. filed with the SEC on April 7, 1983.

| 10.2 | Form of Servicing and Reimbursement Agreement between the Company and AB&Co., dated as of November 1, 1982, is incorporated by reference to Exhibit 10.9 to the Registration Statement on Form S-1 of Value Line, Inc. filed with the SEC on April 7, 1983.

| 10.4 | Form of indemnification agreement, dated July 13, 2010, by and between the Company and each of Howard A. Brecher, Stephen Davis, Alfred Fiore, William E. Reed, Mitchell E. Appel, Stephen R. Anastasio and Thomas T. Sarkany is incorporated by reference to Exhibit 10.15 to the Annual Report on Form 10-K for the year ended April 30, 2010 filed with the SEC on July 16, 2010.

| 10.5 | EULAV Asset Management Declaration of Trust dated as of December 23, 2010 is incorporated by reference to Exhibit 10 to the Quarterly Report on Form 10-Q for the quarter ended January 31, 2011 filed with the SEC on March 24, 2011.

| 10.6(a) | Agreement of Sublease, dated as of February 7, 2013, for the Company’s premises at 485 Lexington Ave., New York, NY, is incorporated by reference to Exhibit 10.1 to the Quarterly Report on Form 10-Q for the quarter ended January 31, 2013 filed with the SEC on March 13, 2013.

49

| 10.6(b) | Lease Modification, dated as of February 7, 2013, is incorporated by reference to Exhibit 10.2 to the Quarterly Report on Form 10-Q for the quarter ended January 31, 2013 filed with the SEC on March 13, 2013.

| 10.7 | Agreement of Lease, dated as of February 29, 2016, between the Company’s subsidiary, VLDC and SPG 205 Chubb Ave., Lyndhurst, NJ, is incorporated by reference to Exhibit 10.1 to the Quarterly Report on Form 10-Q for the quarter ended January 31, 2016 filed with the SEC on March 11, 2016.

| 10.8 | Agreement of Sublease, dated as of October 3, 2016, possession commencing December 1, 2016 for The Company’s premises at 551 Fifth Ave., New York, NY and Consent of Landlord dated November 30, 2016, is incorporated by reference to Exhibit 10.1 to the Quarterly Report on Form 10-Q for the quarter ended October 31, 2016 filed with the SEC on December 13, 2016.

| 14.1 | Code of Business Conduct and Ethics is incorporated by reference to Exhibit 14.1 to the Quarterly Report on Form 10-Q for the quarter ended January 31, 2011 filed with the SEC on March 24, 2011.

| 21.1 | List of subsidiaries of Value Line, Inc.*

| 31.1 | Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*

| 31.2 | Certification of Principal Financial Officer and Principal Accounting Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*

| 32.1 | Certification of the Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. This exhibit shall not be deemed “filed” as a part of this Annual Report on Form 10-K.*

| 32.2 | Certification of the Principal Financial Officer and Principal Accounting Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. This exhibit shall not be deemed “filed” as a part of this Annual Report on Form 10-K.*

| 99.1 | EULAV Asset Management Audited Consolidated Financial Statements as of April 30, 2020. Separate financial statements of subsidiaries not consolidated and fifty percent or less owned persons.*

* Filed herewith.

101.INS | XBRL Instance Document
101.SCH | XBRL Taxonomy Extension Schema Document
101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF | XBRL Taxonomy Extension Definition Linkbase Document
101.LAB | XBRL Taxonomy Extension Label Linkbase Document
101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document

50

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 to be signed on its behalf by the undersigned, thereunto duly authorized.

VALUE LINE, INC.

(Registrant)

| By: | /s/ Howard A. Brecher |
|  | Howard A. Brecher |
|  | Chairman & Chief Executive Officer |
|  | (Principal 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/ Howard A. Brecher |
|  | Howard A. Brecher |
|  | Chairman & Chief Executive Officer and Director |
|  | (Principal Executive Officer) |

| By: | /s/ Stephen R. Anastasio |
|  | Stephen R. Anastasio |
|  | Vice President & Treasurer and Director |
|  | (Principal Financial Officer and Principal Accounting Officer) |

Dated: July 27, 2020

51

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed by the undersigned on behalf of the Registrant as Directors of the Registrant.

/s/ Glenn J. Muenzer |
Glenn Muenzer |
Director |
/s/ Stephen P. Davis |
Stephen Davis |
Director |
/s/ Alfred R. Fiore |
Alfred Fiore |
Director |
/s/ Mary Bernstein |
Mary Bernstein |
Director |

Dated: July 27, 2020

52

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

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

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of Value Line, Inc. (the “Company”) as of April 30, 2020 and 2019, and the related consolidated statements of income, comprehensive income, changes in shareholders’ equity, and cash flows for each of the three years in the period ended April 30, 2020, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of April 30, 2020 and 2019, and the results of its operations and its cash flows for each of the three years in the period ended April 30, 2020, in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

/s/ Horowitz & Ullmann, P.C.

We have served as the Company’s auditor since 1996.

New York, NY

July 27, 2020

53

Part II

Item 8.

Value Line, Inc.

Consolidated Balance Sheets

(in thousands, except share amounts)

|  | April 30, |  |  | April 30, |
|  | 2020 |  |  | 2019 |
Assets |  |  |  |  |  |  |  |
Current Assets: |  |  |  |  |  |  |  |
Cash and cash equivalents (including short term investments of $2,115 and $5,617, respectively) |  | $ | 4,954 |  |  | $ | 6,493 |
Securities available-for-sale |  |  | 29,204 |  |  |  | 21,828 |
Accounts receivable, net of allowance for doubtful accounts of $38 and $22, respectively |  |  | 4,438 |  |  |  | 1,504 |
Receivable from clearing broker |  |  | 608 |  |  |  | - |
Prepaid and refundable income taxes |  |  | - |  |  |  | 254 |
Prepaid expenses and other current assets |  |  | 1,321 |  |  |  | 1,335 |
Total current assets |  |  | 40,525 |  |  |  | 31,414 |
Long term assets: |  |  |  |  |  |  |  |
Investment in EAM Trust |  |  | 59,165 |  |  |  | 58,625 |
Restricted money market investments |  |  | 469 |  |  |  | 469 |
Property and equipment, net |  |  | 9,500 |  |  |  | 1,146 |
Capitalized software and other intangible assets, net |  |  | 69 |  |  |  | 134 |
Total long term assets |  |  | 69,203 |  |  |  | 60,374 |
Total assets |  | $ | 109,728 |  |  | $ | 91,788 |
Liabilities and Shareholders' Equity |  |  |  |  |  |  |  |
Current Liabilities: |  |  |  |  |  |  |  |
Accounts payable and accrued liabilities |  | $ | 2,057 |  |  | $ | 2,068 |
Accrued salaries |  |  | 1,145 |  |  |  | 1,211 |
Dividends payable |  |  | 2,019 |  |  |  | 1,933 |
Accrued taxes on income |  |  | 1,043 |  |  |  | 180 |
Payable to clearing broker |  |  | 588 |  |  |  | - |
Loan obligation-short term |  |  | 194 |  |  |  | - |
Operating lease obligation-short term |  |  | 925 |  |  |  | - |
Unearned revenue |  |  | 18,854 |  |  |  | 20,008 |
Total current liabilities |  |  | 26,825 |  |  |  | 25,400 |
Long term liabilities: |  |  |  |  |  |  |  |
Unearned revenue |  |  | 5,884 |  |  |  | 5,475 |
Loan obligation-long term |  |  | 2,137 |  |  |  | - |
Operating lease obligation-long term |  |  | 8,492 |  |  |  | - |
Deferred charges |  |  | - |  |  |  | 765 |
Deferred income taxes |  |  | 12,851 |  |  |  | 12,624 |
Total long term liabilities |  |  | 29,364 |  |  |  | 18,864 |
Total liabilities |  |  | 56,189 |  |  |  | 44,264 |
Shareholders' Equity: |  |  |  |  |  |  |  |
Common stock, $0.10 par value; authorized 30,000,000 shares; issued 10,000,000 shares |  |  | 1,000 |  |  |  | 1,000 |
Additional paid-in capital |  |  | 991 |  |  |  | 991 |
Retained earnings |  |  | 56,450 |  |  |  | 48,598 |
Treasury stock, at cost (383,279 shares and 336,439 shares, respectively) |  |  | (5,957 | ) |  |  | (4,743 | )
Accumulated other comprehensive income, net of tax |  |  | 1,055 |  |  |  | 1,678 |
Total shareholders' equity |  |  | 53,539 |  |  |  | 47,524 |
Total liabilities and shareholders' equity |  | $ | 109,728 |  |  | $ | 91,788 |

See independent auditor's report and accompanying notes to the consolidated financial statements.

54

Part II

Item 8.

Value Line, Inc.

Consolidated Statements of Income

(in thousands, except share & per share amounts)

|  | For the Fiscal Years Ended |
|  | April 30, |
|  | 2020 |  |  | 2019 |  |  | 2018 |
Revenues: |  |  |  |  |  |  |  |  |  |  |  |
Investment periodicals and related publications |  | $ | 27,628 |  |  | $ | 28,820 |  |  | $ | 29,503 |
Copyright fees |  |  | 12,671 |  |  |  | 7,437 |  |  |  | 6,365 |
Total publishing revenues |  |  | 40,299 |  |  |  | 36,257 |  |  |  | 35,868 |
Expenses: |  |  |  |  |  |  |  |  |  |  |  |
Advertising and promotion |  |  | 3,350 |  |  |  | 3,406 |  |  |  | 3,780 |
Salaries and employee benefits |  |  | 18,189 |  |  |  | 17,781 |  |  |  | 18,488 |
Production and distribution |  |  | 4,945 |  |  |  | 5,222 |  |  |  | 5,857 |
Office and administration |  |  | 4,725 |  |  |  | 4,435 |  |  |  | 5,171 |
Total expenses |  |  | 31,209 |  |  |  | 30,844 |  |  |  | 33,296 |
Income from operations |  |  | 9,090 |  |  |  | 5,413 |  |  |  | 2,572 |
Revenues interest in EAM Trust |  |  | 11,184 |  |  |  | 8,260 |  |  |  | 8,040 |
Profits interest in EAM Trust |  |  | 1,166 |  |  |  | 1,049 |  |  |  | 746 |
Income from securities transactions, net |  |  | 44 |  |  |  | 504 |  |  |  | 540 |
Income before income taxes |  |  | 21,484 |  |  |  | 15,226 |  |  |  | 11,898 |
Income tax provision |  |  | 5,821 |  |  |  | 4,076 |  |  |  | (2,840 | )
Net income |  | $ | 15,663 |  |  | $ | 11,150 |  |  | $ | 14,738 |
Earnings per share, basic & fully diluted |  | $ | 1.62 |  |  | $ | 1.15 |  |  | $ | 1.52 |
Weighted average number of common shares |  |  | 9,646,885 |  |  |  | 9,683,771 |  |  |  | 9,703,255 |

See independent auditor's report and accompanying notes to the consolidated financial statements.

55

Part II

Item 8.

Value Line, Inc.

Consolidated Statements of Comprehensive Income

(in thousands)

|  | For the Fiscal Years Ended |
|  | April 30, |
|  | 2020 |  |  | 2019 |  |  | 2018 |
Net income |  | $ | 15,663 |  |  | $ | 11,150 |  |  | $ | 14,738 |
Other comprehensive income/(loss), net of tax: |  |  |  |  |  |  |  |  |  |  |  |
Change in unrealized gains on securities, net of taxes |  |  | (623 | ) |  |  | 895 |  |  |  | 325 |
Other comprehensive income/(loss) |  |  | (623 | ) |  |  | 895 |  |  |  | 325 |
Comprehensive income |  | $ | 15,040 |  |  | $ | 12,045 |  |  | $ | 15,063 |

See independent auditor's report and accompanying notes to the consolidated financial statements.

56

Part II

Item 8.

Value Line, Inc.

Consolidated Statements of Cash Flows

(in thousands)

|  | For the Fiscal Years Ended |
|  | April 30, |
|  | 2020 |  |  | 2019 |  |  | 2018 |
Cash flows from operating activities: |  |  |  |  |  |  |  |  |  |  |  |
Net income |  | $ | 15,663 |  |  | $ | 11,150 |  |  | $ | 14,738 |
Adjustments to reconcile net income to net cash provided by operating activities: |  |  |  |  |  |  |  |  |  |  |  |
Depreciation and amortization |  |  | 266 |  |  |  | 367 |  |  |  | 1,125 |
Realized gain on sales of equity securities |  |  | 581 |  |  |  | - |  |  |  | (152 | )
Non-voting profits interest in EAM Trust |  |  | (1,166 | ) |  |  | (1,049 | ) |  |  | (746 | )
Non-voting revenues interest in EAM Trust |  |  | (11,184 | ) |  |  | (8,260 | ) |  |  | (8,040 | )
Revenues distribution received from EAM Trust |  |  | 10,588 |  |  |  | 8,027 |  |  |  | 7,879 |
Profits distributions received from EAM Trust |  |  | 1,222 |  |  |  | 945 |  |  |  | 957 |
Deferred rent |  |  | 99 |  |  |  | (89 | ) |  |  | 422 |
Deferred income taxes |  |  | 267 |  |  |  | 512 |  |  |  | (7,058 | )
Other, net |  |  | - |  |  |  | (55 | ) |  |  | (60 | )
Changes in operating assets and liabilities: |  |  |  |  |  |  |  |  |  |  |  |
Unearned revenue |  |  | (745 | ) |  |  | (42 | ) |  |  | (134 | )
Accounts payable & accrued expenses |  |  | (12 | ) |  |  | 142 |  |  |  | 669 |
Accrued salaries |  |  | (66 | ) |  |  | (176 | ) |  |  | 102 |
Accrued taxes on income |  |  | 898 |  |  |  | 339 |  |  |  | 324 |
Prepaid and refundable income taxes |  |  | 254 |  |  |  | 203 |  |  |  | (385 | )
Prepaid expenses and other current assets |  |  | 14 |  |  |  | (65 | ) |  |  | 297 |
Accounts receivable |  |  | (2,934 | ) |  |  | (455 | ) |  |  | (31 | )
Total adjustments |  |  | (1,918 | ) |  |  | 344 |  |  |  | (4,831 | )
Net cash provided by operating activities |  |  | 13,745 |  |  |  | 11,494 |  |  |  | 9,907 |
Cash flows from investing activities: |  |  |  |  |  |  |  |  |  |  |  |
Purchases/sales of securities classified as available-for-sale: |  |  |  |  |  |  |  |  |  |  |  |
Proceeds from sales of equity securities |  |  | 4,387 |  |  |  | - |  |  |  | 152 |
Purchases of equity securities |  |  | (9,302 | ) |  |  | (156 | ) |  |  | - |
Proceeds from sales of fixed income securities |  |  | 8,663 |  |  |  | 8,346 |  |  |  | 3,384 |
Purchases of fixed income securities |  |  | (12,403 | ) |  |  | (11,040 | ) |  |  | (4,368 | )
Acquisition of property and equipment |  |  | (2 | ) |  |  | (11 | ) |  |  | (408 | )
Expenditures for capitalized software |  |  | - |  |  |  | (111 | ) |  |  | - |
Net cash used in investing activities |  |  | (8,657 | ) |  |  | (2,972 | ) |  |  | (1,240 | )
Cash flows from financing activities: |  |  |  |  |  |  |  |  |  |  |  |
Purchase of treasury stock at cost |  |  | (1,214 | ) |  |  | (608 | ) |  |  | (354 | )
Proceeds from SBA loan |  |  | 2,331 |  |  |  | - |  |  |  | - |
Receivable from clearing broker |  |  | (608 | ) |  |  | - |  |  |  | - |
Payable to clearing broker |  |  | 588 |  |  |  | - |  |  |  | - |
Dividends paid |  |  | (7,724 | ) |  |  | (7,362 | ) |  |  | (8,929 | )
Net cash used in financing activities |  |  | (6,627 | ) |  |  | (7,970 | ) |  |  | (9,283 | )
Net change in cash and cash equivalents |  |  | (1,539 | ) |  |  | 552 |  |  |  | (616 | )
Cash, cash equivalents and restricted cash at beginning of year |  |  | 6,962 |  |  |  | 6,410 |  |  |  | 7,026 |
Cash, cash equivalents and restricted cash at end of year |  | $ | 5,423 |  |  | $ | 6,962 |  |  | $ | 6,410 |

See independent auditor's report and accompanying notes to the consolidated financial statements.

57

Part II

Item 8.

Value Line, Inc.

Consolidated Statements of Changes in Shareholders' Equity

For the Fiscal Years Ended April 30, 2020, 2019 and 2018

(in thousands, except share amounts)

|  | Common stock |  |  | Additional paid-in |  |  | Treasury Stock |  |  | Retained |  |  | Accumulated Other Comprehensive |  |  |  |  |
|  | Shares |  |  | Amount |  |  | capital |  |  | Shares |  |  | Amount |  |  | earnings |  |  | income |  |  | Total |
Balance as of April 30, 2017 |  |  | 10,000,000 |  |  | $ | 1,000 |  |  | $ | 991 |  |  |  | (288,335 | ) |  | $ | (3,781 | ) |  | $ | 39,186 |  |  | $ | 458 |  |  | $ | 37,854 |
Net income |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 14,738 |  |  |  |  |  |  |  | 14,738 |
Change in unrealized gains on securities, net of taxes |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 325 |  |  |  | 325 |
Purchase of treasury stock |  |  |  |  |  |  |  |  |  |  |  |  |  |  | (20,045 | ) |  |  | (354 | ) |  |  |  |  |  |  |  |  |  |  | (354 | )
Dividends declared |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | (9,022 | ) |  |  |  |  |  |  | (9,022 | )
Balance as of April 30, 2018 |  |  | 10,000,000 |  |  | $ | 1,000 |  |  | $ | 991 |  |  |  | (308,380 | ) |  | $ | (4,135 | ) |  | $ | 44,902 |  |  | $ | 783 |  |  | $ | 43,541 |

Dividends declared per share were $0.18 for each of the three months ended July 31, 2017, October 31, 2017 and January 31, 2018 and $0.19 for the three months ended April 30, 2018. In addition, a special dividend of $0.20 per share was declared on January 19, 2018.

|  | Common stock |  |  | Additional paid-in |  |  | Treasury Stock |  |  | Retained |  |  | Accumulated Other Comprehensive |  |  |  |  |
|  | Shares |  |  | Amount |  |  | capital |  |  | Shares |  |  | Amount |  |  | earnings |  |  | income |  |  | Total |
Balance as of April 30, 2018 |  |  | 10,000,000 |  |  | $ | 1,000 |  |  | $ | 991 |  |  |  | (308,380 | ) |  | $ | (4,135 | ) |  | $ | 44,902 |  |  | $ | 783 |  |  | $ | 43,541 |
Net income |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 11,150 |  |  |  |  |  |  |  | 11,150 |
Change in unrealized gains on securities, net of taxes |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 895 |  |  |  | 895 |
Purchase of treasury stock |  |  |  |  |  |  |  |  |  |  |  |  |  |  | (28,059 | ) |  |  | (608 | ) |  |  |  |  |  |  |  |  |  |  | (608 | )
Dividends declared |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | (7,454 | ) |  |  |  |  |  |  | (7,454 | )
Balance as of April 30, 2019 |  |  | 10,000,000 |  |  | $ | 1,000 |  |  | $ | 991 |  |  |  | (336,439 | ) |  | $ | (4,743 | ) |  | $ | 48,598 |  |  | $ | 1,678 |  |  | $ | 47,524 |

Dividends declared per share were $0.19 for each of the three months ended July 31, 2018, October 31, 2018 and January 31, 2019 and $0.20 for the three months ended April 30, 2019.

|  | Common stock |  |  | Additional paid-in |  |  | Treasury Stock |  |  | Retained |  |  | Accumulated Other Comprehensive |  |  |  |  |
|  | Shares |  |  | Amount |  |  | capital |  |  | Shares |  |  | Amount |  |  | earnings |  |  | income |  |  | Total |
Balance as of April 30, 2019 |  |  | 10,000,000 |  |  | $ | 1,000 |  |  | $ | 991 |  |  |  | (336,439 | ) |  | $ | (4,743 | ) |  | $ | 48,598 |  |  | $ | 1,678 |  |  | $ | 47,524 |
Net income |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 15,663 |  |  |  |  |  |  |  | 15,663 |
Change in unrealized gains on securities, net of taxes |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | (623 | ) |  |  | (623 | )
Purchase of treasury stock |  |  |  |  |  |  |  |  |  |  |  |  |  |  | (46,840 | ) |  |  | (1,214 | ) |  |  |  |  |  |  |  |  |  |  | (1,214 | )
Dividends declared |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | (7,811 | ) |  |  |  |  |  |  | (7,811 | )
Balance as of April 30, 2020 |  |  | 10,000,000 |  |  | $ | 1,000 |  |  | $ | 991 |  |  |  | (383,279 | ) |  | $ | (5,957 | ) |  | $ | 56,450 |  |  | $ | 1,055 |  |  | $ | 53,539 |

Dividends declared per share were $0.20 for each of the three months ended July 31, 2019, October 31, 2019 and January 31, 2020 and $0.21 for the three months ended April 30, 2020.

See independent auditor's report and accompanying notes to the consolidated financial statements.

58

Value Line, Inc.

Notes to Consolidated Financial Statements

Note 1-Organization and Summary of Significant Accounting Policies:

Value Line, Inc. ("Value Line" or "VLI", and collectively with its subsidiaries, the “Company”) is incorporated in the State of New York. The name "Value Line" as used to describe the Company, its products, and its subsidiaries, is a registered trademark of the Company. The Company's core business is producing investment periodicals and their underlying research and making available certain Value Line copyrights, Value Line trademarks and Value Line Proprietary Ranking System results and other proprietary information, to third parties under written agreements for use in third-party managed and marketed investment products and for other purposes. The Company maintains a significant investment in Eulav Asset Management LLC ("EAM") from which it received a non-voting revenues interest and a non-voting profits interest. EAM was established to provide investment management services to the Value Line Mutual Funds ("Value Line Funds" or the "Funds").

Prior to December 23, 2010 (the "Restructuring Date"), VLI, through its direct subsidiary EULAV Asset Management LLC ("EAM LLC"), provided investment management services to the Value Line Funds, institutions and individual accounts, and through EAM LLC's subsidiary EULAV Securities, Inc. ("ESI"), provided distribution, marketing, and administrative services to the Value Line Funds. On December 23, 2010, the Company deconsolidated the asset management and mutual fund distribution subsidiaries and exchanged its controlling interest in these subsidiaries for a non-voting revenues interest and a non-voting profits interest in EULAV Asset Management Trust, a Delaware business statutory trust ("EAM" or "EAM Trust"), the successor to EAM LLC and the sole member of EULAV Securities LLC ("ES"), the successor to ESI, (the "Restructuring Transaction"). Pursuant to the EAM Declaration of Trust dated as of December 23, 2010 (the "EAM Trust Agreement"), VLI granted EAM the right to use the Value Line name for all existing Value Line Funds and agreed to supply, without charge or expense, the Value Line Proprietary Ranking System information to EAM for use in managing the Value Line Funds.

Use of Estimates:

The preparation of financial statements in conformity with U.S. generally accepted accounting principles ("GAAP") requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results may differ from those estimates.

Principles of Consolidation:

The Company follows the guidance in the Financial Accounting Standards Board's ("FASB") Topic 810 “Consolidation” to determine if it should consolidate its investment in a variable interest entity ("VIE"). A VIE is a legal entity in which either (i) equity investors do not have sufficient equity investment at risk to enable the entity to finance its activities independently or (ii) the equity holders at risk lack the obligation to absorb losses, the right to receive residual returns or the right to make decisions about the entity’s activities that most significantly affect the entity's economic performance. A holder of a variable interest in a VIE is required to consolidate the entity if it is determined that it has a controlling financial interest in the VIE and is therefore the primary beneficiary. The determination of a controlling financial interest in a VIE is based on a qualitative assessment to identify the variable interest holder, if any, that has (i) the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance, and (ii) either the obligation to absorb losses of the entity or the right to receive benefits from the entity that could potentially be significant to the VIE. The accounting guidance requires the Company to perform an ongoing assessment of whether the Company is the primary beneficiary of a VIE and the Company has determined it is not the primary beneficiary of a VIE (see Note 5).

In accordance with FASB's Topic 810, the assets, liabilities, and results of operations of subsidiaries in which the Company has a controlling interest have been consolidated. All significant intercompany accounts and transactions have been eliminated in consolidation. On December 23, 2010, the Company completed the Restructuring Transaction and deconsolidated the related affiliates in accordance with FASB's Topic 810. As part of the Restructuring Transaction, the Company received a significant non-voting revenues interest (excluding distribution revenues) and a significant non-voting profits interest in the new entity, EULAV Asset Management, a Delaware statutory trust (“EAM” or “EAM Trust”). The Company relied on the guidance in FASB's ASC Topics 323 and 810 in its determination not to consolidate its investment in EAM and to account for such investment under the equity method of accounting. The Company reports the amount it receives for its non-voting revenues and non-voting profits interests as a separate line item below operating income in the Consolidated Statements of Income.

Revenue Recognition:

Depending upon the product, subscription fulfillment for Value Line periodicals and related publications is available in print or digitally, via internet access. The length of a subscription varies by product and offer received by the subscriber. Generally, subscriptions are offered as annual subscriptions with the majority of subscriptions paid in advance. Subscription revenues, net of discounts, are recognized ratably on a straight line basis when the product is served to the client over the life of the subscription. Accordingly, the amount of subscription fees to be earned by fulfilling subscriptions after the date of the balance sheets are shown as unearned revenue within current and long-term liabilities.

Copyright fees are derived from providing certain Value Line trademarks and the Value Line Proprietary Ranking System results to third parties under written agreements for use in selecting securities for third party marketed products, including unit investment trusts, annuities and exchange traded funds ("ETFs"). The Company earns asset-based copyright fees upon delivery of the product to the customer as specified in the individual agreements. Revenue is recognized monthly and received either quarterly or in advance over the term of the agreement and, because it is asset-based, will fluctuate as the market value of the underlying portfolio increases or decreases in value.

EAM earns investment management fees from the Value Line Funds. The management fees and average daily net assets for the Value Line Funds are calculated by State Street Bank, which serves as the fund accountant, fund administrator, and custodian of the Value Line Funds.

The Value Line Funds are open-end management companies registered under the Investment Company Act of 1940 (the "1940 Act"). Shareholder transactions for the Value Line Funds are processed each business day by the third party transfer agent of the Funds. Shares can be redeemed without advance notice upon request of the shareowners each day that the New York Stock Exchange is open.

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Investment in Unconsolidated Entities:

The Company accounts for its investment in its unconsolidated entity, EAM, using the equity method of accounting in accordance with FASB’s ASC 323. The equity method is an appropriate means of recognizing increases or decreases measured by GAAP in the economic resources underlying the investments. Under the equity method, an investor recognizes its share of the earnings or losses of an investee in the periods for which they are reported by the investee in its financial statements rather than in the period in which an investee declares a dividend or distribution. An investor adjusts the carrying amount of an investment for its share of the earnings or losses recognized by the investee.

The Company’s “interests” in EAM, the investment adviser to and the sole member of the distributor of the Value Line Funds, consist of a "non-voting revenues interest" and a "non-voting profits interest" in EAM as defined in the EAM Trust Agreement. The non-voting revenues interest entitles the Company to receive a range of 41% to 55%, based on the amount of EAM’s adjusted gross revenues, excluding EULAV Securities' distribution revenues (“Revenues Interest”). The non-voting profits interest entitles the Company to receive 50% of EAM's profits, subject to certain limited adjustments as defined in the EAM Trust Agreement (“Profits Interest”). The Revenues Interest and at least 90% of the Profits Interest are to be distributed each quarter to all interest holders of EAM, including Value Line. Subsequent to the Restructuring Date, the Company's Revenues Interest in EAM excludes participation in the service and distribution fees of EAM's subsidiary EULAV Securities. The Company reflects its non-voting revenues and non-voting profits interests in EAM as non-operating income under the equity method of accounting subsequent to the Restructuring Transaction. Although the Company does not have control over the operating and financial policies of EAM, pursuant to the EAM Trust Agreement, the Company has a contractual right to receive its share of EAM's revenues and profits.

Recent Accounting Pronouncements:

In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842)”. This ASU requires that, for leases longer than one year, a lessee recognize in the statements of financial position a right-of-use asset, representing the right to use the underlying asset for the lease term, and a lease liability, representing the liability to make lease payments. It also requires that for finance leases, a lessee recognize interest expense on the lease liability, separately from the amortization of the right-of-use asset in the statements of earnings, while for operating leases, such amounts should be recognized as a combined expense. The Company adopted this ASU in May 2019 under a modified retrospective approach (see Note 9).

In August 2016, the FASB issued Accounting Standards Update No. 2016-15, Classification of Certain Cash Receipts and Cash Payments (a consensus of the Emerging Issues Task Force) (“ASU 2016-15”), effective for public business entities for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. The amendments in ASU 2016-15 address eight specific cash flow issues and apply to all entities that are required to present a statement of cash flows under ASC Topic 230, Statement of Cash Flows. The Company has adopted ASU 2016-15 in the first quarter of fiscal 2019.

The FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606)”, which requires an entity to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which it expects to be entitled in exchange for those goods or services. In addition, ASU No. 2014-09 requires disclosures of the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. ASU No. 2014-09 supersedes most existing U.S. GAAP revenue recognition principles, and it permits the use of either the retrospective or cumulative effect transition method. ASU No. 2014-09 is effective for annual reporting periods beginning after December 15, 2017, including interim periods within those annual periods. The Company has adopted ASU No. 2014-09 in the first quarter of fiscal 2019, which does not have a material impact on the Company's consolidated condensed financial statements and related disclosures.

In November 2016, the FASB issued ASU No. 2016-18, "Statement of Cash Flows (Topic 230): Restricted Cash (a consensus of the FASB Emerging Issues Task Force)", effective for annual reporting periods beginning after December 15, 2017, including interim periods within those annual periods. This ASU requires that the reconciliation of the beginning-of-period and end-of-period amounts shown in the statement of cash flows include cash, cash equivalents and amounts generally described as restricted cash or restricted cash equivalents. The Company has adopted ASU No. 2016-18 in the first quarter of fiscal 2019, which does not have a material impact on the Company's consolidated condensed financial statements and related disclosures.

On June 21, 2018, the United States Supreme Court reversed the 1992 ruling in Quill, which protected firms delivering items by common carrier into a state where it had no physical presence from having to collect sales tax in such state. The Company has integrated the effects of the various state laws into its operations and continues to do so.

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Valuation of Securities:

The Company's securities classified as cash equivalents and available-for-sale consist of shares of money market funds that invest primarily in short-term U.S. Government securities and investments in equities including ETFs and are valued in accordance with the requirements of the Fair Value Measurements Topic of the FASB's ASC 820. The securities classified as available-for-sale reflected in the Consolidated Balance Sheets are valued at market and unrealized gains and losses, net of applicable taxes, are reported as a separate component of shareholders' equity. Realized gains and losses on sales of the securities classified as available-for-sale are recorded in earnings as of the trade date and are determined on the identified cost method.

The Company classifies its securities available-for-sale as current assets to properly reflect its liquidity and to recognize the fact that it has liquid assets available-for-sale should the need arise.

Market valuations of securities listed on a securities exchange and ETF shares are based on the closing sales prices on the last business day of each month. The market value of the Company's fixed maturity U.S. Government debt securities is determined utilizing publicly quoted market prices. Cash equivalents consist of investments in money market funds that invest primarily in U.S. Government securities valued in accordance with rule 2a-7 under the 1940 Act.

The Fair Value Measurements Topic of FASB's ASC defines fair value as the price that the Company would receive upon selling an investment in a timely transaction to an independent buyer in the principal or most advantageous market for the investment. The Fair Value Measurements Topic established a three-tier hierarchy to maximize the use of observable market data and minimize the use of unobservable inputs and to establish classification of fair value measurements for disclosure purposes. Inputs refer broadly to the information that market participants would use in pricing the asset or liability, including assumptions about risk. Examples of risks include those inherent in a particular valuation technique used to measure fair value such as the risk inherent in the inputs to the valuation technique. Inputs are classified as observable or unobservable. Observable inputs are inputs that reflect the assumptions market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of the reporting entity. Unobservable inputs are inputs that reflect the reporting entity’s own assumptions about the factors market participants would use in pricing the asset or liability developed based on the best information available in the circumstances.

The three-tier hierarchy of inputs is summarized in the three broad levels listed below.

Level 1 – quoted prices in active markets for identical investments

Level 2 – other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, credit risk, etc.)

Level 3 – significant unobservable inputs (including the Company’s own assumptions in determining the fair value of investments)

The following summarizes the levels of fair value measurements of the Company’s investments:

|  |  | As of April 30, 2020 |
($ in thousands) |  | Level 1 |  |  | Level 2 |  |  | Level 3 |  |  | Total |
Cash equivalents |  | $ | 2,115 |  |  | $ | - |  |  | $ | - |  |  | $ | 2,115 |
Securities available-for-sale |  |  | 29,204 |  |  |  | - |  |  |  | - |  |  |  | 29,204 |
|  | $ | 31,319 |  |  | $ | - |  |  | $ | - |  |  | $ | 31,319 |

|  |  | As of April 30, 2019 |
($ in thousands) |  | Level 1 |  |  | Level 2 |  |  | Level 3 |  |  | Total |
Cash equivalents |  | $ | 5,617 |  |  | $ | - |  |  | $ | - |  |  | $ | 5,617 |
Securities available-for-sale |  |  | 21,828 |  |  |  | - |  |  |  | - |  |  |  | 21,828 |
|  | $ | 27,445 |  |  | $ | - |  |  | $ | - |  |  | $ | 27,445 |

The Company had no other financial instruments such as futures, forwards and swap contracts. For the periods ended April 30, 2020 and April 30, 2019, there were no Level 2 nor Level 3 investments. The Company does not have any liabilities subject to fair value measurement.

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Advertising expenses:

The Company expenses advertising costs as incurred.

Income Taxes:

The Company computes its income tax provision in accordance with the Income Tax Topic of the FASB's ASC. 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. The Company adopted the provisions of ASU 2015-17, Income taxes (Topic 740) during the first quarter of fiscal 2018 and now classifies all deferred taxes as long-term liabilities on the Consolidated Balance Sheets.

The Income Tax Topic of the FASB's ASC establishes for all entities, a minimum threshold for financial statement recognition of the benefit of positions taken in filing tax returns (including whether an entity is taxable in a particular jurisdiction), and requires certain expanded tax disclosures. As of April 30, 2020, management has reviewed the tax positions for the years still subject to tax audit under the statute of limitations, evaluated the implications, and determined that there is no material impact to the Company's financial statements.

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 period. Any shares that are reacquired during the period are weighted for the portion of the period that they are outstanding. The Company does not have any potentially dilutive common shares from outstanding stock options, warrants, restricted stock, or restricted stock units.

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, 2020 and April 30, 2019, cash equivalents included $2,115,000 and $5,617,000, respectively, for amounts invested in money market mutual funds that invest in short-term U.S. government securities.

Note 2 - Supplementary Cash Flow Information:

Reconciliation of Cash, Cash Equivalents, and Restricted Cash:

The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the Consolidated Statement of Cash Flows that sum to the total of the same such amounts shown in the Consolidated Statement of Cash Flows.

|  | Fiscal Years Ended April 30, |
($ in thousands) |  | 2020 |  |  | 2019 |  |  | 2018 |
Cash and cash equivalents |  | $ | 4,954 |  |  | $ | 6,493 |  |  | $ | 5,941 |
Restricted cash |  | $ | 469 |  |  | $ | 469 |  |  | $ | 469 |
Total cash, cash equivalents, and restricted cash shown in the Consolidated Statement of Cash Flows |  | $ | 5,423 |  |  | $ | 6,962 |  |  | $ | 6,410 |

Income Tax Payments:

The Company made income tax payments as follows:

|  | Fiscal Years Ended April 30, |
($ in thousands) |  | 2020 |  |  | 2019 |  |  | 2018 |
State and local income tax payments |  | $ | 1,105 |  |  | $ | 387 |  |  | $ | 307 |
Federal income tax payments to the Parent |  | $ | 3,325 |  |  | $ | 2,700 |  |  | $ | 3,975 |

See Note 3 - Related Party Transactions for tax amounts associated with Arnold Bernhard and Co., Inc. (“AB&Co.” or the "Parent").

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Note 3 - Related Party Transactions:

Investment Management (overview):

On December 23, 2010, the Company deconsolidated its asset management and mutual fund distribution businesses and its interest in these businesses was restructured as a non-voting revenues and non-voting profits interests in EAM. Accordingly, the Company no longer reports this operation as a separate business segment, although it still maintains a significant interest in the cash flows generated by this business and will receive non-voting revenues and non-voting profits interests going forward, as discussed below.

Total assets in the Value Line Funds managed and/or distributed by EAM at April 30, 2020, were $3.58 billion, which is $485 million, or 15.7%, above total assets of $3.09 billion in the Value Line Funds managed and/or distributed by EAM at April 30, 2019.

The Company’s non-voting revenues and non-voting profits interests in EAM entitle it to receive quarterly distributions in a range of 41% to 55% of EAM’s revenues (excluding distribution revenues) from EAM’s mutual fund and separate account business and 50% of the residual profits of EAM (subject to temporary increase in certain limited circumstances). The Voting Profits Interest Holders will receive the other 50% of residual profits of EAM. Distribution is not less than 90% of EAM’s profits payable each fiscal quarter under the provisions of the EAM Trust Agreement. Value Line’s percent share of EAM’s revenues is calculated each fiscal quarter. The applicable recent non-voting revenues interest percentage for the fourth quarter of fiscal 2020 was 51.51%.

The non-voting revenues and 90% of the Company's non-voting profits interests due from EAM to the Company are payable each fiscal quarter under the provisions of the EAM Trust Agreement. The distributable amounts earned through the balance sheet date, which is included in the Investment in EAM Trust on the Consolidated Balance Sheets, and not yet paid, were $2,949,000 and $2,420,000 at April 30, 2020 and April 30, 2019, respectively.

EAM Trust - VLI's non-voting revenues and non-voting profits interests:

The Company holds non-voting revenues and non-voting profits interests in EAM which entitle the Company to receive from EAM an amount ranging from 41% to 55% of EAM's investment management fee revenues from its mutual fund and separate accounts business. EAM currently has no separately managed account clients. The Company recorded income from its non-voting revenues interest and its non-voting profits interests in EAM as follows:

|  | Fiscal Years Ended April 30, |
($ in thousands) |  | 2020 |  |  | 2019 |  |  | 2018 |
Non-voting revenues interest in EAM |  | $ | 11,184 |  |  | $ | 8,260 |  |  | $ | 8,040 |
Non-voting profits interest in EAM |  |  | 1,166 |  |  |  | 1,049 |  |  |  | 746 |
|  | $ | 12,350 |  |  | $ | 9,309 |  |  | $ | 8,786 |

Transactions with Parent:

During the fiscal years ended April 30, 2020 and April 30, 2019, the Company was reimbursed $388,000 and $384,000, respectively for payments it made on behalf of and for services it provided to AB&Co. There were no receivables due from the Parent at April 30, 2020 or April 30, 2019.

The Company is a party to a tax-sharing arrangement with the Parent which allocates the tax liabilities of the two Companies between them. For the years ended April 30, 2020, 2019, and 2018, the Company made payments to the Parent for federal income tax amounting to $3,325,000, $2,700,000 and $3,975,000, respectively.

From time to time, the Parent has purchased additional shares of common stock of the Company in the market when and as the Parent has determined it to be appropriate. The Parent may make additional purchases of common stock of the Company from time to time in the future. As of April 30, 2020, the Parent owned 89.78% of the outstanding shares of common stock of the Company.

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Note 4 - Investments:

Securities Available-for-Sale:

Investments held by the Company and its subsidiaries are classified as securities available-for-sale in accordance with FASB's ASC 320, Investments - Debt and Equity Securities. All of the Company's securities classified as available-for-sale were readily marketable or had a maturity of twelve months or less and are classified as current assets on the Consolidated Balance Sheets.

Equity Securities:

Equity securities classified as available-for-sale on the Consolidated Balance Sheets, consist of ETFs held for dividend yield that attempt to replicate the performance of certain equity indexes and ETFs that hold preferred shares primarily of financial institutions.

As of April 30, 2020 and April 30, 2019, the aggregate cost of the equity securities classified as available-for-sale, which consist of investments in the SPDR Series Trust S&P Dividend ETF (SDY), First Trust Value Line Dividend Index ETF (FVD), PowerShares Financial Preferred ETF (PGF), Select Utilities Select Sector SPDR ETF (XLU), First Trust Value Line 100 ETF (FVL), ProShares Trust S&P 500 Dividend Aristocrats ETF (NOBL), SPDR S&P 500 ETF (SPY) and iShares Select Dividend ETF (DVY) and equity securities portfolio under EAM management held at Charles Schwab was $12,877,000 and $8,541,000, respectively, and the fair value was $14,125,000 and $10,622,000, respectively.

Proceeds from sales of equity securities classified as available-for-sale during the twelve months ended April 30, 2020 were $4,387,000 and the related capital losses of $581,000 were reclassified from Accumulated Other Comprehensive Income in the Consolidated Balance Sheet to the Consolidated Statement of Income. There were no gains or losses on sales of equity securities classified as available-for-sale during fiscal 2019 or fiscal 2018. Capital gain distributions of $152,000 were reclassified from Accumulated Other Comprehensive Income in the Consolidated Balance Sheet to the Consolidated Statement of Income during the twelve months ended April 30, 2018. There were no capital gain distributions in fiscal 2020 and 2019. The decrease in gross unrealized gains on equity securities classified as available-for-sale of $833,000, net of deferred tax benefit of $112,000 was included in Shareholders' Equity at April 30, 2020. The increase in gross unrealized gains on equity securities classified as available-for-sale of $1,087,000, net of deferred taxes of $228,000 was included in Shareholders' Equity at April 30, 2019. As of April 30,2020 and April 30, 2019, accumulated other comprehensive income included net unrealized gains of $1,248,000 and $2,081,000, net of deferred taxes of $325,000 and $437,000, respectively.

The carrying value and fair value of securities available-for-sale at April 30, 2020 were as follows:

($ in thousands) |  | Cost |  |  | Gross Unrealized Gains |  |  | Gross Unrealized Losses |  |  | Fair Value |
ETFs - equities |  | $ | 12,877 |  |  | $ | 1,317 |  |  | $ | (69 | ) |  | $ | 14,125 |

The carrying value and fair value of securities available-for-sale at April 30, 2019 were as follows:

($ in thousands) |  | Cost |  |  | Gross Unrealized Holding Gains |  |  | Fair Value |
ETFs - equities |  | $ | 8,541 |  |  | $ | 2,081 |  |  | $ | 10,622 |

Government Debt Securities (Fixed Income Securities):

Fixed income securities consist of certificates of deposits and securities issued by federal, state and local governments within the United States.

Proceeds from maturities and sales of government debt securities classified as available-for-sale during the twelve months ended April 30, 2020 and April 30, 2019, were $8,663,000 and $8,346,000, respectively. As of April 30, 2020 and April 30, 2019, accumulated other comprehensive income included unrealized gains of $177,000 and $43,000, net of deferred taxes of $46,000 and $9,000, respectively.

The aggregate cost and fair value at April 30, 2020 of fixed income securities classified as available-for-sale were as follows:

|  | Amortized |  |  | Gross Unrealized |  |  |  |  |
($ in thousands) |  | Historical Cost |  |  | Holding Gains |  |  | Fair Value |
Maturity |  |  |  |  |  |  |  |  |  |  |  |
Due within 1 year |  | $ | 14,652 |  |  | $ | 177 |  |  | $ | 14,829 |
Due 1 year through 5 years |  |  | 250 |  |  |  | - |  |  |  | 250 |
Total investment in government debt securities |  | $ | 14,902 |  |  | $ | 177 |  |  | $ | 15,079 |

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The increase in gross unrealized gains of $134,000 on fixed income securities classified as available-for-sale net of deferred income taxes of $37,000, was included in Accumulated Other Comprehensive Income on the Consolidated Balance Sheet as of April 30, 2020.

The aggregate cost and fair value at April 30, 2019 of fixed income securities classified as available-for-sale were as follows:

|  | Amortized |  |  | Gross Unrealized |  |  |  |  |
($ in thousands) |  | Historical Cost |  |  | Holding Gains |  |  | Fair Value |
Maturity |  |  |  |  |  |  |  |  |  |  |  |
Due within 1 year |  | $ | 6,913 |  |  | $ | 33 |  |  | $ | 6,946 |
Due 1 year through 5 years |  |  | 4,250 |  |  |  | 10 |  |  |  | 4,260 |
Total investment in government debt securities |  | $ | 11,163 |  |  | $ | 43 |  |  | $ | 11,206 |

The increase in gross unrealized gains of $46,000 on fixed income securities classified as available-for-sale net of deferred income taxes of $10,000, was included in Accumulated Other Comprehensive Income on the Consolidated Balance Sheet as of April 30, 2019.

The average yield on the Government debt securities classified as available-for-sale at April 30, 2020 and April 30, 2019 was 2.27% and 2.09%, respectively.

Income from Securities Transactions:

Income from securities transactions was comprised of the following:

|  |  | Fiscal Years Ended April 30, |
($ in thousands) |  | 2020 |  |  | 2019 |  |  | 2018 |
Dividend income |  | $ | 352 |  |  | $ | 257 |  |  | $ | 226 |
Interest income |  |  | 279 |  |  |  | 201 |  |  |  | 103 |
Capital gain distributions from ETFs (1) |  |  | - |  |  |  | - |  |  |  | 152 |
Realized loss on sale of securities (2) |  |  | (581 | ) |  |  | - |  |  |  | - |
Other |  |  | (6 | ) |  |  | 46 |  |  |  | 59 |
Total income from securities transactions, net |  | $ | 44 |  |  | $ | 504 |  |  | $ | 540 |

(1) Capital gain distributions of $152,000 were reclassified from Accumulated Other Comprehensive Income in the Consolidated Balance Sheets to the Consolidated Statements of Income in fiscal 2018.

(2) Realized losses of $581,000 were reclassified from Accumulated Other Comprehensive Income in the Consolidated Balance Sheets to the Consolidated Statements of Income in fiscal 2020.

The changes in the value of equity and fixed income securities investments are recorded in Other Comprehensive Income in the Consolidated Financial Statements. Realized gains and losses are recorded on the trade date in the Consolidated Statements of Income when securities are sold, mature or are redeemed. As of April 30, 2020, the changes in gross unrealized gains of $699,000, net of deferred tax benefit of $76,000, were recorded in Accumulated Other Comprehensive Income in the Consolidated Balance Sheets. As of April 30, 2019, the changes in gross unrealized gains of $1,133,000, net of deferred tax expense of $238,000 were recorded in Accumulated Other Comprehensive Income in the Consolidated Balance Sheets.

Investment in Unconsolidated Entities:

Equity Method Investment:

As of April 30, 2020 and April 30, 2019, the Company's investment in EAM Trust, on the Consolidated Balance Sheets was $59,165,000 and $58,625,000, respectively.

The value of VLI’s investment in EAM at April 30, 2020 and April 30, 2019 reflects the fair value of contributed capital of $55,805,000 at inception, which included $5,820,000 of cash and liquid securities in excess of working capital requirements contributed to EAM’s capital account by VLI, plus VLI's share of non-voting revenues and non-voting profits from EAM less distributions, made quarterly to VLI by EAM, during the period subsequent to its initial investment through the dates of the Consolidated Balance Sheets.

It is anticipated that EAM will have sufficient liquidity and earn enough profit to conduct its current and future operations so the management of EAM will not need additional funding.

The Company monitors its Investment in EAM Trust for impairment to determine whether an event or change in circumstances has occurred that may have a significant adverse effect on the fair value of the investment. Impairment indicators include, but are not limited to the following: (a) a significant deterioration in the earnings performance, asset quality, or business prospects of the investee, (b) a significant adverse change in the regulatory, economic, or technological environment of the investee, (c) a significant adverse change in the general market condition of the industry in which the investee operates, or (d) factors that raise significant concerns about the investee’s ability to continue as a going concern such as negative cash flows, working capital deficiencies, or noncompliance with statutory capital and regulatory requirements. EAM did not record any impairment losses for its assets during the fiscal years 2020 or 2019.

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The components of EAM’s investment management operations, provided to the Company by EAM, were as follows:

|  | Fiscal Years Ended April 30, |
($ in thousands) |  | 2020 |  |  | 2019 |  |  | 2018 |
Investment management fees earned from the Value Line Funds, net of waivers shown below |  | $ | 21,985 |  |  | $ | 16,715 |  |  | $ | 15,988 |
12b-1 fees and other fees, net of waivers shown below |  | $ | 8,436 |  |  | $ | 6,811 |  |  | $ | 6,455 |
Other income |  | $ | (156 | ) |  | $ | 273 |  |  | $ | 171 |
Investment management fee waivers and reimbursements |  | $ | 302 |  |  | $ | 421 |  |  | $ | 487 |
12b-1 fee waivers |  | $ | 667 |  |  | $ | 654 |  |  | $ | 754 |
Value Line’s non-voting revenues interest |  | $ | 11,184 |  |  | $ | 8,260 |  |  | $ | 8,040 |
EAM's net income (1) |  | $ | 2,332 |  |  | $ | 2,098 |  |  | $ | 1,492 |

(1) Represents EAM's net income, after giving effect to Value Line’s non-voting revenues interest, but before distributions to voting profits interest holders and to the Company in respect of its 50% non-voting profits interest.

|  | Fiscal Years Ended April 30, |
($ in thousands) |  | 2020 |  |  | 2019 |
EAM's total assets |  | $ | 61,335 |  |  | $ | 60,683 |
EAM's total liabilities (1) |  |  | (4,192 | ) |  |  | (3,547 | )
EAM's total equity |  | $ | 57,143 |  |  | $ | 57,136 |

(1) At April 30, 2020 and 2019, EAM's total liabilities included a payable to VLI for its accrued non-voting revenues and non-voting profits interests of $2,949,000 and $2,420,000, respectively.

Note 5 - Variable Interest Entity:

The Company retained a non-voting revenues interest and a 50% non-voting profits interest in EAM, which was formed, as a result of the Restructuring Transaction on December 23, 2010, to carry on the asset management and mutual fund distribution businesses formerly conducted by the Company. EAM is considered to be a VIE in relation to the Company. The Company makes its determination for consolidation of EAM as a VIE based on a qualitative assessment of the purpose and design of EAM, the terms and characteristics of the variable interests in EAM, and the risks EAM is designed to originate and pass through to holders of variable interests. Other than EAM, the Company does not have an interest in any other VIEs.

The Company has determined that it does not have a controlling financial interest in EAM because it does not have the power to direct the activities of EAM that most significantly impact its economic performance. Value Line does not hold any voting stock of EAM and it does not have any involvement in the day-to-day activities or operations of EAM. Although the EAM Trust Agreement provides Value Line with certain consent rights and contains certain restrictive covenants related to the activities of EAM, these are considered to be protective rights and therefore Value Line does not maintain control over EAM.

In addition, although EAM is expected to be profitable, there is a risk that it could operate at a loss. While all of the profit interest shareholders in EAM are subject to variability based on EAM’s operations risk, Value Line’s non-voting revenues interest in EAM is a preferred interest in the revenues of EAM, rather than a profits interest in EAM, and Value Line accordingly believes it is subject to proportionately less risk than other holders of the profits interests.

The Company has not provided any explicit or implicit financial or other support to EAM other than what was contractually agreed to in the EAM Trust Agreement. Value Line has no obligation to fund EAM in the future and, as a result, has no exposure to loss beyond its initial investment and any undistributed revenues and profits interests retained in EAM. The following table presents the total assets of EAM, the maximum exposure to loss due to involvement with EAM, as well as the value of the assets and liabilities the Company has recorded on its Consolidated Balance Sheets for its interest in EAM.

|  |  |  |  |  | Value Line |
($ in thousands) |  | VIE Assets |  |  | Investment in EAM Trust (1) |  |  | Liabilities |  |  | Maximum Exposure to Loss |
As of April 30, 2020 |  | $ | 61,335 |  |  | $ | 59,165 |  |  | $ | - |  |  | $ | 59,165 |
As of April 30, 2019 |  | $ | 60,683 |  |  | $ | 58,625 |  |  | $ | - |  |  | $ | 58,625 |

(1) Reported within Long-Term Assets on Consolidated Balance Sheets.

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Note 6 - 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, net, on the Consolidated Balance Sheets was comprised of the following:

|  | As of April 30, |
($ in thousands) |  | 2020 |  |  | 2019 |
Building and leasehold improvements |  | $ | 1,013 |  |  | $ | 1,013 |
Operating lease - right-of-use asset |  |  | 8,550 |  |  |  | - |
Furniture and equipment |  |  | 4,047 |  |  |  | 4,042 |
|  |  | 13,610 |  |  |  | 5,055 |
Accumulated depreciation and amortization |  |  | (4,110 | ) |  |  | (3,909 | )
Total property and equipment, net |  | $ | 9,500 |  |  | $ | 1,146 |

Note 7 - Federal, State and Local Income Taxes:

In accordance with the requirements of the Income Tax Topic of the FASB's ASC, the Company's provision for income taxes includes the following:

|  | Fiscal Years Ended April 30, |
($ in thousands) |  | 2020 |  |  | 2019 |  |  | 2018 |
Current tax expense: |  |  |  |  |  |  |  |  |  |  |  |
Federal |  | $ | 4,201 |  |  | $ | 2,964 |  |  | $ | 3,853 |
State and local |  |  | 1,353 |  |  |  | 600 |  |  |  | 365 |
Current tax expense |  |  | 5,554 |  |  |  | 3,564 |  |  |  | 4,218 |
Deferred tax expense (benefit): |  |  |  |  |  |  |  |  |  |  |  |
Federal |  |  | 1 |  |  |  | (650 | ) |  |  | (7,021 | )
State and local |  |  | 266 |  |  |  | 1,162 |  |  |  | (37 | )
Deferred tax expense (benefit): |  |  | 267 |  |  |  | 512 |  |  |  | (7,058 | )
Income tax provision |  | $ | 5,821 |  |  | $ | 4,076 |  |  | $ | (2,840 | )

On December 22, 2017 H.R. 1, originally known as the Tax Cuts and Jobs Act (the "Tax Act"), was enacted. The Tax Act lowered the U.S. federal income tax rate ("Federal Tax Rate") from 35% to 21% effective January 1, 2018. Accordingly, the Company computes Federal income tax expense using the Federal Tax Rate of 21% in fiscal year 2020 and each year thereafter. The Company computed Federal income tax expense for the twelve months ended April 30, 2019 using the Federal Tax Rate of 21%, and computed its income tax expense for the twelve months ended April 30, 2018 using a blended Federal Income tax rate of 30.33%.

The overall effective income tax rates, as a percentage of pre-tax ordinary income for the twelve months ended April 30, 2020, April 30, 2019 and April 30, 2018 were 27.09%, 26.81% and (23.87%), respectively. The increase in the effective tax rate during the twelve months ended April 30, 2020 is primarily a result of an increase in the state and local income taxes to 6.30% as a result of changes in state and local tax legislation and the effect of the lowering of the NYC tax allocation factor on deferred taxes in fiscal 2019. The Company's annualized overall effective tax rate fluctuates due to a number of factors, in addition to changes in tax law, including but not limited to an increase or decrease in the ratio of items that do not have tax consequences to pre-tax income, the Company's geographic profit mix between tax jurisdictions, taxation method adopted by each locality, new interpretations of existing tax laws and rulings and settlements with tax authorities.

The overall change in the effective Federal tax rate during the twelve months ended April 30, 2019 and April 30, 2018 is primarily a result of the reduced Federal Tax Rate. As mentioned above, in fiscal 2018 the U.S. statutory federal corporate income tax rate was reduced from 35% to 21%, which resulted in a tax benefit of 54.51% of pre-tax income for the twelve months ended April 30, 2018, primarily attributable to the effect on the long-term deferred tax liability. The Company re-calculated its net deferred tax assets and liabilities using the Federal Tax Rate under the Tax Act and allocated it directly to both current and deferred income tax expenses from continuing operations. In addition, due to evolving state tax legislation, the Company's state and local effective income tax rate, net of Federal income tax benefit, increased from 0.7% of pretax income for the twelve months ended April 30, 2018, to 6.02% of pretax income for the twelve months ended April 30, 2019.

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Deferred income taxes, a liability, 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 long-term deferred tax liability are as follows:

|  | Fiscal Years Ended April 30, |
($ in thousands) |  | 2020 |  |  | 2019 |
Federal tax liability (benefit): |  |  |  |  |  |  |  |
Deferred gain on deconsolidation of EAM |  | $ | 10,669 |  |  | $ | 10,669 |
Deferred non-cash post-employment compensation |  |  | (372 | ) |  |  | (372 | )
Depreciation and amortization |  |  | 108 |  |  |  | 130 |
Unrealized gain on securities held for sale |  |  | 299 |  |  |  | 446 |
Right of Use Asset |  |  | (182 | ) |  |  | - |
Deferred charges |  |  | (166 | ) |  |  | (354 | )
Other |  |  | (207 | ) |  |  | (279 | )
Total federal tax liability |  |  | 10,149 |  |  |  | 10,240 |
State and local tax liabilities (benefits): |  |  |  |  |  |  |  |
Deferred gain on deconsolidation of EAM |  |  | 2,564 |  |  |  | 2,530 |
Deferred non-cash post-employment compensation |  |  | (88 | ) |  |  | (74 | )
Depreciation and amortization |  |  | 44 |  |  |  | 40 |
Unrealized gain on securities held for sale |  |  | 72 |  |  |  | 106 |
Other |  |  | 110 |  |  |  | (218 | )
Total state and local tax liabilities |  |  | 2,702 |  |  |  | 2,384 |
Deferred tax liability, long-term |  | $ | 12,851 |  |  | $ | 12,624 |

The tax effect of temporary differences giving rise to the Company's long-term deferred tax liability is primarily a result of the federal, state and local taxes related to the $50,805,000 gain from deconsolidation of the Company's asset management and mutual fund distribution subsidiaries, partially offset by the long-term tax benefit related to the non-cash post-employment compensation of $1,770,000 granted to VLI's former employee.

The Company uses the effective income tax rate determined to provide for income taxes on a year-to-date basis and reflects the tax effect of any tax law changes and certain other discrete events in the period in which they occur.

The provision for income taxes differs from the amount of income tax determined by applying the applicable U.S. statutory income tax rate to pre-tax income as a result of the following:

|  | Fiscal Years Ended April 30, |
|  | 2020 |  |  | 2019 |  |  | 2018 |
U.S. statutory federal tax rate |  |  | 21.00 | % |  |  | 21.00 | % |  |  | 30.33 | %
Increase (decrease) in tax rate from: |  |  |  |  |  |  |  |  |  |  |  |
Effect on deferred tax liabilities from federal tax rate reduction to 21% |  |  | - |  |  |  | - |  |  |  | (54.51 | )%
State and local income taxes, net of federal income tax benefit |  |  | 6.30 | % |  |  | 6.02 | % |  |  | 0.70 | %
Effect of dividends received deductions |  |  | (0.24 | )% |  |  | (0.24 | )% |  |  | (0.49 | )%
Other, net |  |  | 0.03 | % |  |  | 0.03 | % |  |  | 0.10 | %
Effective income tax rate |  |  | 27.09 | % |  |  | 26.81 | % |  |  | (23.87 | )%

The Company believes that, as of April 30, 2020, there were no material uncertain tax positions that would require disclosure under GAAP.

The Company is included in the consolidated federal income tax return of the Parent. The Company has a tax sharing agreement which requires it to make tax payments to the Parent equal to the Company's liability/(benefit) as if it filed a separate return. Beginning with the fiscal year ended April 30, 2017, the Company files combined income tax returns with the Parent on a unitary basis in certain states as a result of changes in state tax regulations.

The Company’s federal income tax returns (included in the Parent’s consolidated returns) and state and city tax returns for fiscal years ended 2017 through 2019, are subject to examination by the tax authorities, generally for three years after they are filed with the tax authorities. The Company is presently engaged in a New York City tax audit for the fiscal years ended April 30, 2017 through 2019 and does not expect it to have a material effect on the financial statements.

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Note 8 - 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 on the salaries of eligible employees and the amount of consolidated net operating income as defined in the Plan. For the fiscal years ended April 30, 2020, 2019 and 2018, the estimated profit sharing plan contribution, which is included as an expense in salaries and employee benefits in the Consolidated Statements of Income, was $870,000, $592,000 and $496,000, respectively.

Note 9 - Lease Commitments:

On November 30, 2016, Value Line, Inc., received consent from the landlord at 551 Fifth Avenue, New York, NY to the terms of a new sublease agreement between Value Line, Inc. and ABM Industries, Incorporated (“ABM” or the “Sublandlord”) commencing on December 1, 2016. Pursuant to the agreement Value Line leased from ABM 24,726 square feet of office space located on the second and third floors at 551 Fifth Avenue, New York, NY (“Building” or “Premises”) beginning on December 1, 2016 and ending on November 29, 2027. Base rent under the sublease agreement is $1,126,000 per annum during the first year with an annual increase in base rent of 2.25% scheduled for each subsequent year, payable in equal monthly installments on the first day of each month, subject to customary concessions in the Company’s favor and pass-through of certain increases in utility costs and real estate taxes over the base year. The Company provided a security deposit represented by a letter of credit in the amount of $469,000 in October 2016, which is scheduled to be reduced to $305,000 on September 30, 2021 and fully refunded after the sublease ends. This Building became the Company’s new corporate office facility. The Company is required to pay for certain operating expenses associated with the Premises as well as utilities supplied to the Premises. The sublease terms provide for a significant decrease (23% initially) in the Company’s annual rental expenditure taking into account free rent for the first six months of the sublease. Sublandlord provided Value Line a work allowance of $417,000 which accompanied with the six months free rent worth $563,000 was applied against the Company’s obligation to pay rent at our NYC headquarters, delaying the actual rent payments until November 2017.

On February 29, 2016, the Company’s subsidiary VLDC and Seagis Property Group LP (the “Landlord”) entered into a lease agreement, pursuant to which VLDC has leased 24,110 square feet of warehouse and appurtenant office space located at 205 Chubb Ave., Lyndhurst, NJ (“Warehouse”) beginning on May 1, 2016 and ending on April 30, 2024 (“Lease”). Base rent under the Lease is $192,880 per annum payable in equal monthly installments on the first day of each month, in advance during fiscal 2017 and will gradually increase to $237,218 in fiscal 2024, subject to customary increases based on operating costs and real estate taxes. The Company provided a security deposit in cash in the amount of $32,146, which will be fully refunded after the lease term expires. The lease is a net lease requiring the Company to pay for certain operating expenses associated with the Warehouse as well as utilities supplied to the Warehouse.

In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842)”. This ASU requires that, for leases longer than one year, a lessee recognizes in the statements of financial position a right-of-use asset, representing the right to use the underlying asset for the lease term, and a lease liability, representing the liability to make lease payments. It also requires that for finance leases, a lessee recognizes interest expense on the lease liability, separately from the amortization of the right-of-use asset in the statements of earnings, while for operating leases, such amounts should be recognized as a combined expense. The firm adopted this ASU in May 2019 under a modified retrospective approach.

The Company adopted ASU 2016-02 using a modified retrospective transition approach as of the Effective Date as permitted by the amendments in ASU 2018-11, which provides an alternative modified retrospective transition method. As a result, the Company was not required to adjust its comparative period financial information for effects of the standard or make the new required lease disclosures for periods before the date of adoption (i.e. May 1, 2019). The Company has elected to employ the transitionary relief offered by the FASB and, therefore, has not reassessed (1) whether existing or expired contracts contain a lease, (2) lease classification for existing or expired leases or (3) the accounting for initial direct costs that were previously capitalized.

The Company leases office space in New York, NY and a warehouse and appurtenant office space in Lyndhurst, NJ. The Company has evaluated these leases and determined that they are operating leases under the definitions of the guidance of ASU 2016-02.

The right-of-use asset is initially measured at cost, which comprises the initial amount of the net present value of the lease liability adjusted for lease payments made at or before the lease commencement date, plus any initial direct costs incurred less any lease incentives received. For operating leases, the right-of-use asset is subsequently measured throughout the lease term at the carrying amount of the net present value of the lease liability, plus initial direct costs, plus (minus) any prepaid (accrued) lease payments, less the unamortized balance of lease incentives received.

On May 1, 2019, the Company recorded a right-of-use asset in the amount of $9,575,000, which represents the lease liability of $10,340,000 adjusted for previously recorded unamortized lease incentives in the amount of $765,000. The right-of-use asset will be amortized over the remaining lease term in the amount equal to the difference between the calculated straight-line expense of the total lease payments less the monthly interest calculated on the remaining lease liability. As of April 30, 2020, the Company had a long-term lease asset of $8,550,000 recorded in property and equipment in its consolidated balance sheets.

The Company recognizes lease expense, calculated as the remaining cost of the lease allocated over the remaining lease term on a straight-line basis. Lease expense are presented as part of continuing operations in the consolidated condensed statements of income. For the twelve months ended April 30, 2020, the Company recognized $1,499,000 in lease expense.

For the twelve months ended April 30, 2020, the Company paid $1,400,000 in rent relating to the leases. As a payment arising from an operating lease, the $1,400,000 will be classified within operating activities in the consolidated statements of cash flows.

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The Company’s leases generally do not provide an implicit interest rate, and therefore the Company estimated an incremental borrowing rate, or IBR, as of the commencement date, to determine the present value of its operating lease liabilities. The IBR is defined under ASC 842 as the rate of interest that the Company would have to pay to borrow on a collateralized basis over a similar term for an amount equal to the lease payments in a similar economic environment. The following table reconciles the undiscounted future minimum lease payments to the total operating lease liabilities recognized on the consolidated balance sheet as of April 30, 2020:

Fiscal years ended April 30, |  | (in thousands) |
2021 |  |  | 1,432 |
2022 |  |  | 1,506 |
2023 |  |  | 1,597 |
2024 |  |  | 1,634 |
2025 |  |  | 1,429 |
Thereafter |  |  | 3,838 |
Total undiscounted future minimum lease payments |  |  | 11,436 |
Less: difference between undiscounted lease payments & the present value of future lease payments |  |  | 2,019 |
Total operating lease liabilities |  | $ | 9,417 |

For the fiscal years ended April 30, 2020, 2019 and 2018, rental expenses were $1,499,000, $1,278,000 and $1,246,000, respectively.

Note 10 - Disclosure of Credit Risk of Financial Instruments with Off-Balance Sheet Risk:

Other than EAM and the Value Line Funds as explained in Note 3 - Related Party Transactions, a single customer accounted for a significant portion of the Company's sales in fiscal 2020, 2019 or 2018, and its accounts receivable as of April 30, 2020 or 2019. During the twelve months ended April 30, 2020, 2019 and 2018, 31.4%, 20.5% and 17.7%, respectively, of total publishing revenues were derived from a single customer as explained in Note 17 - Concentration.

Note 11 - Comprehensive Income:

The FASB's ASC Comprehensive Income topic 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 otherwise would not be recognized in the calculation of net income.

As of April 30, 2020 and April 30, 2019, the Company held equity securities consisting primarily of ETFs with high relative dividend yields that are classified as securities available-for-sale on the Consolidated Balance Sheets. As of April 30, 2020 and April 30, 2019 the Company also held fixed income securities consisting of certificates of deposits and securities issued by federal, state, and local governments within the United States that are classified as securities available-for-sale on the Consolidated Balance Sheets. The change in valuation of these securities, net of deferred income taxes, has been recorded in accumulated other comprehensive income in the Company's Consolidated Balance Sheets.

The components of comprehensive income that are included in the Consolidated Statement of Changes in Shareholders' Equity for the twelve months ending April 30, 2020 are as follows:

|  | Fiscal Year Ended April 30, 2020 |
($ in thousands) |  | Amount Before Tax |  |  | Tax (Expense) / Benefit |  |  | Amount Net of Tax |
Change in unrealized gains on securities |  | $ | (1,280 | ) |  | $ | 227 |  |  | $ | (1,053 | )
Add: Losses realized in net income |  |  | 581 |  |  |  | (151 | ) |  |  | 430 |
|  | $ | (699 | ) |  | $ | 76 |  |  | $ | (623 | )

The components of comprehensive income that are included in the Consolidated Statement of Changes in Shareholders' Equity for the twelve months ending April 30, 2019 are as follows:

|  | Fiscal Year Ended April 30, 2019 |
($ in thousands) |  | Amount Before Tax |  |  | Tax (Expense) / Benefit |  |  | Amount Net of Tax |
Change in unrealized gains on securities |  | $ | 1,133 |  |  | $ | (238 | ) |  | $ | 895 |
|  | $ | 1,133 |  |  | $ | (238 | ) |  | $ | 895 |

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The components of comprehensive income that are included in the Consolidated Statement of Changes in Shareholders' Equity for the twelve months ending April 30, 2018 are as follows:

|  | Fiscal Year Ended April 30, 2018 |
($ in thousands) |  | Amount Before Tax |  |  | Tax (Expense) / Benefit |  |  | Amount Net of Tax |
Change in unrealized gains on securities |  | $ | 437 |  |  | $ | 8 |  |  | $ | 445 |
Less: Gains realized in net income |  |  | (152 | ) |  |  | 32 |  |  |  | (120 | )
|  | $ | 285 |  |  | $ | 40 |  |  | $ | 325 |

Note 12 - Accounting for the Costs of Computer Software Developed for Internal Use:

The Company has 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 requires companies to capitalize as long-lived assets many of the costs associated with developing or purchasing software for internal use and amortize those costs over the software's estimated useful life in a systematic and rational manner. Such costs, when incurred, are capitalized and amortized over the expected useful life of the asset, normally 3 to 5 years.

The Company did not incur and did not capitalize expenditures related to third party programmers' costs or to the development of software for internal use during the twelve months ended April 30, 2020.

During the twelve months ended April 30, 2019 the Company capitalized $111,000 related to the third party programmers' costs. The Company did not incur and did not capitalize expenditures related to the development of software for internal use during the twelve months ended April 30, 2019 or April 30, 2018. Total amortization expenses for the years ended April 30, 2020, 2019 and 2018 were $65,000, $131,000 and $848,000, respectively.

Note 13 - Treasury Stock and Repurchase Program:

On April 17, 2020, the Company's Board of Directors approved a share repurchase program authorizing the repurchase of shares of the Company’s common stock up to an aggregate purchase price of $2,000,000. The repurchases may be made from time to time on the open market at prevailing market prices, in negotiated transactions off the market, in block purchases or otherwise. The repurchase program may be suspended or discontinued at any time at the Company’s discretion and has no set expiration date.

Treasury stock, at cost, consists of the following:

($ in thousands except for cost per share) |  | Shares |  |  | Cost Assigned |  |  | Average Cost per Share |  |  | Aggregate Purchase Price Remaining Under the Program |
Balance as of April 30, 2017 (1), (2) |  |  | 288,335 |  |  | $ | 3,781 |  |  | $ | 13.11 |  |  | $ | 609 |
Purchases effected in open market (2) |  |  | 20,045 |  |  | $ | 354 |  |  | $ | 17.67 |  |  | $ | - |
Balance as of April 30, 2018 |  |  | 308,380 |  |  | $ | 4,135 |  |  | $ | 13.41 |  |  | $ | 255 |
Purchases effected in open market (2) (3) |  |  | 28,059 |  |  | $ | 608 |  |  | $ | 21.68 |  |  | $ | - |
Balance as of April 30, 2019 |  |  | 336,439 |  |  | $ | 4,743 |  |  | $ | 14.10 |  |  | $ | 1,438 |
Purchases effected in open market (2) (3) |  |  | 46,840 |  |  | $ | 1,214 |  |  | $ | 25.91 |  |  | $ | - |
Balance as of April 30, 2020 |  |  | 383,279 |  |  | $ | 5,957 |  |  | $ | 15.54 |  |  | $ | 2,000 |

(1) Included 85,219 shares with a total average cost of $1,036,000 that were acquired during the former repurchase program, which was authorized in January 2011 and expired in January 2012; 18,400 shares were acquired prior to the repurchase program authorized in January 2011.

(2) Were acquired during the $3 million repurchase program authorized in September 2012.

(3) Were acquired during the $2 million repurchase program authorized in October 2018.

Note 14 - Copyright Fees:

During the twelve months ended April 30, 2020, copyright fees of $12,671,000 were 70.4% above fiscal 2019. During the twelve months ended April 30, 2019, copyright fees of $7,437,000 were 16.8% above fiscal 2018. As of April 30, 2020, total third party sponsored assets were $8.6 billion, as compared to $6.1 billion in assets at April 30, 2019.

Note 15 - Restricted Cash and Deposits:

Restricted Money Market Investment in the noncurrent assets on the Consolidated Balance Sheets at April 30, 2020 and April 30, 2019, includes $469,000, which represents cash invested in a bank money market fund securing a letter of credit ("LOC") in the amount of $469,000 issued to the sublandlord as a security deposit for the Company's new leased corporate office facility.

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Note 16 - Concentration:

During the twelve months ended April 30, 2020, 31.4% of total publishing revenues of $40,299,000 were derived from a single customer. During the twelve months ended April 30, 2019, 20.5% of total publishing revenues of $36,257,000 were derived from a single customer.

Note 17 - Concentration of Credit Risk:

Financial instruments that potentially subject the Company to concentration of credit risk consist principally of cash deposits. Accounts at each institution are insured by the Federal Deposit Insurance Corporation (“FDIC”) up to $250,000. At April 30, 2020 and 2019, the Company had $5,202,000 and $1,597,000, respectively, in excess of the FDIC insured limit. Management has concluded the excess does not represent a material risk, based on the creditworthiness of the counter parties.

Note 18 - Business Segments:

The Publishing business segment, the Company's only reportable segment subsequent to December 23, 2010, produces investment periodicals and related publications (retail and institutional) in both print and digital form, and includes Value Line copyrights and Value Line Proprietary Ranking System results and other proprietary information.

As more fully described in Note 1 - Organization and Summary of Significant Accounting Policies, the Company deconsolidated its investment management business on December 23, 2010 and therefore no longer reports the investment management operation as a separate business unit. Although VLI continues to receive significant cash flows from these operations through its non-controlling investment in EAM, it no longer considers this to be a reportable business segment due to its lack of control over the operating and financial policies of EAM.

Note 19 - Paycheck Protection Program Loan:

The Company recently executed a note and received loan (the "PPP Loan") from JP Morgan Chase Bank under the Paycheck Protection Program ("PPP") which was established under the Coronavirus Aid, Relief, and Economic Security Act (the "CARES Act") and is administered by the U.S. Small Business Administration. In April 2020, the Company received the PPP Loan of $2,331,365. The proceeds from the PPP Loan will be used in accordance with the terms of the CARES Act program, as described further below.

The term of the PPP Loan is two years. The interest rate on the PPP Loan is 1.00%, which shall be deferred for the first six months of the term of the loan. Pursuant to the terms of the CARES Act, the proceeds of the PPP Loan may be used for payroll costs, mortgage interest, rent or utility costs. The promissory note evidencing the PPP Loan contains customary events of default relating to, among other things, payment defaults, breach of representations and warranties, or provisions of the promissory note. The occurrence of an event of default may result in a claim for the immediate repayment of all amounts outstanding under such PPP Loan, collection of all amounts owing from the respective Borrower, filing suit and obtaining judgment against the respective Borrower.

Under the terms of the CARES Act, Borrower can apply for and be granted forgiveness for all or a portion of the PPP Loan. Such forgiveness will be determined, subject to limitations, based on the use of loan proceeds in accordance with the terms of the CARES Act, as described above, during a period not to exceed a twenty-four week period after loan origination and the maintenance or achievement of certain employee levels. No assurance is provided that Borrower will obtain forgiveness under any relevant PPP Loan in whole or in part.

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