Aspen Group Limited · ASX:APZ
Aspen — FY2009 Earnings Presentation
39 slides from Aspen's earnings presentation, Aug 31, 2009
Slide 1: Aspen Group Annual Results 2009
For personal use only Aspen Group Annual Results 2009
Slide 2: Agenda
Agenda For personal use only Key Messages Aspen Overview 1. Summary of Group Results 2. Financial Summary 3. Capital Management 4. Property Portfolio 5. Funds Management 6. Outlook Questions Appendix A – Operating Profit & Loss Appendix B – Balance Sheet Appendix C – Investment Property Portfolio 2
Slide 3: Annual Results Overview: Key Messages
Annual Results Overview Key Messages For personal use only 100% of headstock assets independently valued over Confidence in our last 6 months asset values Cap rate (ex Karratha) up 220 points to 10.02% 89% of AUM independently valued over last 6 months Balance sheet strengthened Long term debt / Gea
Slide 4: Aspen Overview: Corporate Structure
Aspen Overview Corporate Structure For personal use only Direct Property Funds Equity Portfolio Management Investments & Loans • 11 Investment properties • 8 Equity investments - $60M Assets Managed - $369M • 6 Divisions - $1B • Loans to associates - $88M • Inventories - $35M • Portfolio of diversif
Slide 5: Aspen Overview: $1.4 Billion of AUM
Aspen Overview $1.4 Billion of AUM For personal use only 5
Slide 6: 1. Summary of Group Results
1. Summary of Group Results For personal use only Satisfactory operating profit given difficult market conditions Strong operating performance from investment properties Funds management income subdued given fewer transactions in funds Balance sheet well positioned post equity raising Gearing reduce
Slide 7: 2. Financial Summary
For personal use only 2. Financial Summary
Slide 8: Financial Summary Overview
2. Financial Summary Overview For personal use only FY09 FY08 Financial Performance Total revenue $70.2m $77.3m Operating profit after tax $33.2m $43.8m Statutory profit / (loss) after tax ($64.7m) $70.8m Operating earnings per security 11.91 c 18.06 c Interest Cover (EBITDA / Interest expense) 2.8
Slide 9: Reconciliation of Operating Profit to Headline Result
2. Financial Summary Financial Performance for Full Year For personal use only Reconciliation of Operating Profit to Headline Result FY09 FY08 ($M) ($M) Operating Net Profit 33.2 43.8 Swap revaluations (8.3) 1.4 Property revaluations (25.3) 29.6 Share option expense (5.5) (3.5) Fair value of equity
Slide 10: Income Breakdown
2. Financial Summary Income Breakdown For personal use only Revenue and Other Income - by source 90 80 70 60 50 $ million 40 30 20 10 0 Rental income from Recurring Management Non-recurring Financial & other income T OT AL REVENUE & investment properties Fees T ransactional Fees OT HER INCOME FY08 F
Slide 11: Fee Summary
2. Financial Summary Fee Summary For personal use only 11
Slide 12: Up to date independent valuations
2. Financial Summary Up to date independent valuations For personal use only Independent valuations adopted in last 6 months on 89% of property assets (all property assets independently valued over the last 12 months) % of property Date of assets Business Unit independent independently valuation val
Slide 13: APZ 24 Month Security Price vs NTA
2. Financial Summary 24 month Security Price vs NTA For personal use only APZ - 24 Month Security Price vs NTA 3.00 2.50 2.00 NTA $ per SS Security 1.50 Price 1.00 0.50 0.00 Jun-07 Sep-07 Dec-07 Mar-08 Jun-08 Sep-08 Dec-08 Mar-09 Jun-09 Note: NTA diluted by $0.42 following June 2009 equity raising 1
Slide 14: 3. Capital Management
For personal use only 3. Capital Management
Slide 15: Capital Management Overview
3. Capital Management Overview For personal use only Senior debt maturing in 2012 All debt facilities remain fully compliant with banking covenants June 09 equity raising reduced debt by $73 million and gearing to 30% Look through gearing reduced to 40% (expected to fall to 37% post settlement of eq
Slide 16: Summary of Facilities
3. Capital Management Summary of Facilities For personal use only Facility Facility Limit Purpose Maturity Covenants NAB Core Facility $213m Long Term Feb 2012 LVR 69% to maturity Core Facility NAB Karratha $22.5m Karratha Dec 2013 LVR as per Core Facility Village Facility Amortising @ $250k / month
Slide 17: Debt profile
3. Capital Management Debt profile For personal use only Gearing 30% Senior Debt Hedged (on drawn amount) 65% Weighted average cost of debt 7.24% Senior Debt Facility Expiry Feb 2012 Look-through gearing 40%¹ Net interest cover covenant 1.5 times Forecast FY10 Interest Cover² +2.5 times Forecast FY1
Slide 18: Capital Structure
3. Capital Management Capital Structure For personal use only Issued Capital Profile Stapled Securities on Issue 579.9 million Market Cap (at $0.40 closing price, 28 August 2009) $232 million Total Security holders Circa 4,900 Member of the S&P ASX 300 Index 18
Slide 19: 4. Property Portfolio
For personal use only 4. Property Portfolio
Slide 20: Property Portfolio Overview
4. Property Portfolio Overview For personal use only 32% uplift in rental revenues Karratha and St Kilda leases contributed 25% of this increase 100% of portfolio independently valued between Jan - Mar 09 with 43% independently valued again in August 09 Weighted average capitalisation rate up 220 po
Slide 21: Strong Tenancy Profile
4. Property Portfolio Strong Tenancy Profile For personal use only Government and major corporates account for 70% of total portfolio income Government tenants contribute 23% of income Major corporates contribute 47% of income including: Woodside (Karratha Village, WA) 21.1% Elders (Elders Woolstore
Slide 22: Investment Properties
4. Property Portfolio Investment Properties For personal use only 2H09 Change to New Cap Rate Prior Cap Rate Property: Book Value Jun-09 Dec-08 Valuation ($m) (%) (%) (%) Septimus Roe, WA 82.0* -6.8% 11.00 11.00 Alcoa Office Complex, WA 29.0 7.4% 9.25 8.50 Elders Woolstores, WA 56.0 -3.5% 11.00 11.0
Slide 23: Leasing Profile
4. Property Portfolio Leasing Profile For personal use only Key Tenant Expiry Financial % of Tenant Lease Expiry Profile by Financial Year Year Income (% of rental income) Centrelink 2011 4% 0% 5% 10% 15% 20% 25% 30% 35% 40% Elders* 2012 13% 2010 Minister for Works 2014 5% 2011 Woodside ** 2014 21%
Slide 24: 5. Funds Management
For personal use only 5. Funds Management
Slide 25: Funds Management Overview
5. Funds Management Overview For personal use only Fee income contributed 27% of total income in a difficult market Total fees down 46% on prior period due to lower development activity and nil acquisitions in Funds Recurring funds management fees based on AUM increased 10% due to maturing asset bas
Slide 26: Funds Management Divisions
5. Funds Management Divisions For personal use only Aspen Aspen Aspen Aspen Aspen Aspen Branding Parks Diversified Living Developments Villages Communities Modular Product Tourism and Development Fund Retirement Sector Core Income Residential Estates Affordable Accommodation Series Aged Care Accommo
Slide 27: Aspen Parks Property Fund
5. Funds Management Aspen Parks Property Fund For personal use only Jun 09 Jun 08 Assets under Management $249m $265m Recurring contribution to pre tax operating profit ¹ $6.0m $6.5m Aspen’s equity interest in Fund 17 % 16 % ¹ Recurring contribution = recurring fees + Aspen’s equity share of profits
Slide 28: Aspen Diversified Property Fund
5. Funds Management Aspen Diversified Property Fund For personal use only Jun 09 Jun 08 Assets under Management $139m $190m Recurring contribution to pre tax operating profit ¹ $1.9m $3.3m Aspen’s equity interest in Fund 36% 36% ¹ Recurring contribution = recurring fees + Aspen’s equity share of pro
Slide 29: Aspen Living
5. Funds Management Aspen Living For personal use only Jun 09 Jun 08 Assets under Management $328m $307m Recurring contribution to pre tax operating profit ¹ $0.8m $5.8m Aspen’s equity interest in syndicates (weighted ave) 23% 23% ¹ Recurring contribution = recurring fees + Aspen’s equity share of p
Slide 30: Aspen Developments
5. Funds Management Aspen Developments For personal use only Jun 09 Jun 08 Assets under Management $313m $245m Recurring contribution to pre tax operating profit ¹ $7.9m $11.2m Aspen’s equity interest in syndicate 43% 43% ¹ Recurring contribution = recurring fees + Aspen’s equity share of profits Co
Slide 31: 6. Outlook
For personal use only 6. Outlook
Slide 32: Outlook
6. Outlook For personal use only Entering FY10 with sound balance sheet, lower gearing and strong income profile Current economic climate providing market opportunities for selective acquisitions - potential upside to the Group’s earnings forecast Landmark resource projects such as Gorgon expected t
Slide 33: Questions
For personal use only Questions
Slide 34: Appendix A: Operating Profit and Loss
Appendix A Operating Profit and Loss For personal use only FY09 ($m) FY08 ($m) Change % Income from operations Rental income 43.0 32.6 32% Funds management 19.2 35.7 -46% Other income 8.0 10.2 -22% Total income 70.2 78.5 -11% Expenses Direct property expenses (12.4) (9.6) 29% Administrative and othe
Slide 35: Appendix B: Balance Sheet
Appendix B Balance Sheet For personal use only 30 June 09 31 Dec 08 Key Changes Assets $m $m $m Current Assets Cash and Other 52.7 61.2 Non Current Investment Properties 368.6 407.7 (39.1)¹ Equity Investments 59.8 53.8 Inventories 35.0 24.5 Other 104.7 93.3 Total Assets 620.8 640.5 Current Liabiliti
Slide 36: Appendix C: Investment Property Portfolio
Appendix C Investment Property Portfolio For personal use only Septimus Roe Square Alcoa Office Building St Kilda Road Adelaide Terrace, Perth, WA Booragoon, WA Melbourne, VIC Location WA Location WA Location VIC NLA (sqm) 17,548 sqm NLA (sqm) 7,645 sqm NLA (sqm) 8,385 sqm Description Located in the
Slide 37: Appendix C: Investment Property Portfolio
Appendix C Investment Property Portfolio For personal use only Elders Woolstores 33 York Street Karratha Village Fremantle, WA Sydney, NSW Karratha, WA Location WA Location NSW Location NT NLA (sqm) 103,798 sqm NLA (sqm) 544 sqm NLA (sqm) n/a Description A major industrial holding Description Level
Slide 38: Appendix C: Investment Property Portfolio
Appendix C Investment Property Portfolio For personal use only 55 Currie Street Noble Park Rocklea Adelaide, SA Melbourne, VIC Brisbane, QLD Location SA Location VIC Location QLD NLA (sqm) 25,727 sqm NLA (sqm) 43,511 sqm NLA (sqm) 14,524 sqm Description A 12 level office building located in Descript
Slide 39: Disclaimer
Disclaimer For personal use only This presentation has been prepared by Aspen Group (“Aspen”) and should not be considered in any way to be an offer, invitation, solicitation or recommendation with respect to the subscription for, purchase or sale of any security, and neither this document nor anyth