Aspen Group, Inc. · OTC:ASPU
Aspen — Investor Presentation (March 2020)
24 slides from Aspen's investor presentation, Mar 16, 2020
Slide 1: Creating Value by Transforming the College Education Experience
CREATING VALUE BY TRANSFORMING THE COLLEGE EDUCATION EXPERIENCE Michael Mathews Chairman & Chief Executive Officer March 2020 Nasdaq: ASPU
Slide 2: Safe Harbor Statement
SAFE HARBOR STATEMENT Certain statements in this presentation and responses to various questions include forward - looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements relating to the growth of future student enrollmen ts, bookings and A
Slide 3: Aspen Group Is an Education Technology Company Making College Affordable Again
ASPEN GROUP IS AN EDUCATION TECHNOLOGY COMPANY WITH MISSION OF MAKING COLLEGE AFFORDABLE AGAIN Focused on high LTV nursing programs to drive revenue growth and margin improvement EdTech platform drives low Customer Acquisition Cost (CAC) that enables lower tuition rates and monthly payment plans , w
Slide 4: Evolving Our Business to Drive Growth
2014 Launches Monthly Payment Plans for online degree programs Shifts entire marketing focus to post - licensure online nursing degrees for existing RNs 2018 Launches Bachelor of Science in Nursing pre - licensure program (PL - BSN) in Phoenix, AZ PL - BSN delivers the largest TAM, lowest Customer A
Slide 5: Trends Fueling Strong Demand for Nurses
TRENDS FUELING STRONG DEMAND FOR NURSES The Bureau of Labor Statistics (BLS) estimated in 2016 that demand for RNs will grow by 15% over the next decade to ~3.4 million High percentage of RNs approaching retirement age (>30% over 50) also impacts future demand BLS cites core reasons fueling the nurs
Slide 6: Acceptance Rates in Pre-Licensure Degree Programs Not Meeting High Demand
ACCEPTANCE RATES IN PRE - LICENSURE DEGREE PROGRAMS NOT MEETING HIGH DEMAND U.S. nursing schools only accept 70% of applicants creating wait lists up to 2 - 3 years at public and private institutions AACN estimates there are over 190,000 applicants annually Nursing applicants are turned away due to
Slide 7: Nursing - Fastest Growing ASPU Student Body
NURSING - FASTEST GROWING ASPU STUDENT BODY 8,354 6,586 11,033 9,240 Total Enrollment Nursing Students Q3 FY 2019 Q3 FY 2020 +40% +32% ASPU offers affordable nursing degrees from bachelor to doctorate, including highly sought - after MSN - FNP and pre - licensure BSN programs Nursing Student Growth
Slide 8: EdTech Platform Lowers Enrollment Costs and Improves Student Outcomes
EDTECH PLATFORM LOWER ENROLLMENT COSTS AND IMPROVES STUDENT OUTCOMES Vertically - integrated lead acquisition platform Acquires highly qualified leads Automated real - time tracking of instructor activity and student participation across all courses CRM prioritizes outreach to prospects with highest
Slide 9: EdTech Platform Drives Better Student Outcomes
EDTECH PLATFORM DRIVES BETTER STUDENT OUTCOMES STUDENT SATISFACTION Aspen University alumni that felt they achieved the goals they set when they started the course or program MONTHLY PAYMENT MODEL Aspen University alumni that graduated without financial aid* 92 % 84 % As compared to the 60% national
Slide 10: EdTech Platform Delivers Significant Savings for ASPU Nursing Students
EDTECH PLATFORM DELIVERS SIGNIFICANT SAVINGS FOR ASPU NURSING STUDENTS Salary uplift and expanded career options with a payback of one year or less motivates student to enroll in ASPU programs and graduate Aspen Group, Inc. Competitive Degree Offerings DEGREE PROGRAM ASPEN / USU AVERAGE* SAVINGS CHA
Slide 11: Transforming College Financing Through Monthly Payment Plans
TRANSFORMING THE COLLEGE FINANCING EXPERIENCE THROUGH MONTHLY PAYMENT PLANS Aspen is transforming the college education experience for students looking to pursue higher paying careers that require advanced skills AFFORDABLE Lower tuition costs than comparable campus and online programs DEBT MINIMIZA
Slide 12: Monthly Payment Plan Provides Recurring Cash
MONTHLY PAYMENT PLAN PROVIDES RECURRING CASH 65% of active student body pay monthly Monthly recurring cash of over $1.6 million* Monthly payments are interest free and paid over a fixed period 5,861 6,162 6,633 7,028 7,125 Q3 2019 Q4 2019 Q1 2020 Q2 2020 Q3 2020 Students Paying Monthly Tuition by Qu
Slide 13: Focusing Spending and Investment to Generate Maximum Long-Term Returns
Focusing our spending and investment to generate maximum long - term returns OPENING NEW PRE - LICENSURE BSN CAMPUSES (WITH MSN - FNP WEEKEND IMMERSIONS) Our Pre - licensure BSN and MSN - FNP programs deliver the highest LTVs of all our nursing programs LEVERAGE EDTECH PLATFORM FOR HIGHLY EFFICIENT
Slide 14: Efficient Marketing Spend Delivers Attractive ROI
EFFICIENT MARKETING SPEND DELIVERS ATTRACTIVE ROI Each marketing dollar spent returned 15X revenue on average, exceeding traditional online education sector returns and on - par with a SaaS model profile. 1 Based on 6 - month rolling weighted average CAC for each university’s enrollments 2 Lifetime
Slide 15: Pre-Licensure BSN Campuses - $100 Million Opportunity
Aspen University's Pre - licensure BSN program carries the highest LTV of all our nursing programs Targeting 12 campuses nationally by 2024 Opening new campuses in Texas and Florida in CY 2020 PRE - LICENSURE BSN CAMPUSES - $100 MILLION OPPORTUNITY ~1500 active students by year three per campus Expe
Slide 16: Fiscal Year 2020 Key Metrics
FISCAL YEAR 2020 KEY METRICS Increasing enrollments in highest LTV programs while managing costs to achieve positive Adjusted EBITDA Year - over - year enrollment growth of ~30% Bookings forecasted to exceed 54% to over $102 million Annual revenue growth to meet or exceed 42% Adjusted EBITDA positiv
Slide 17: Aspen Group Key Investment Takeaways
ASPEN GROUP KEY INVESTMENT TAKEAWAYS Targeting high - growth nursing education sector with a comprehensive degree offering EdTech platform provides key competitive advantages of lower tuition costs, flexible financing options and better student outcomes Focused marketing spend on highest LTV nursing
Slide 18: Operating Metrics and Financial Results Third Quarter FY 2020 Appendix
OPERATING METRICS AND FINANCIAL RESULTS THIRD QUARTER FY 2020 APPENDIX
Slide 19: Strong Bookings Growth and Increased ARPU
STRONG BOOKINGS GROWTH AND INCREASED ARPU FUELED BY HIGH LTV PROGRAM ENROLLMENTS *“Bookings” are defined by multiplying LTV by new student enrollments for each operating unit. 1,363 1,746 Q3 FY2019 Q3 FY2020 Total Enrollment +28% $11,352 $15,199 Q3 FY2019 Q3 FY2020 ARPU +34% $15.5 $26.5 Q3 FY2019 Q3
Slide 20: Equity Snapshot
EQUITY SNAPSHOT AS OF 03/11/2020 NASDAQ TICKER: ASPU SHARE PRICE: $6.34 52 WEEK RANGE: $3.58 - $10.27 MARKET CAP: $137 Million SHARES OUTSTANDING: 21.6 Million MANAGEMENT & DIRECTOR OWNERSHIP: 17%
Slide 21: Q3 FY'20 Income Statement
Q3 FY’20 Income Statement For the Quarter Ended January 31, 2020 Revenues $ 12,537,940 Operating expenses Cost of revenues 5,163,007 General and administrative 8,627,588 Depreciation and amortization 475,393 Total operating expenses 14,265,988 Operating loss from operations (1,728,048) Other income
Slide 22: Q3 FY'20 Net Loss, Adjusted EBITDA and EPS by Subsidiary
Q3 FY’20 Net (Loss)/Income, Adjusted EBITDA and EPS for Consolidated and Subsidiaries Consolidated AGI AU USU Net (Loss)/Income $ (2,281,052) $ (3,604,910) $ 1,283,830 $40,028 Adjusted EBITDA $ 222,415 $ (1,894,480) $ 1,868,821 $248,074 Net Profit/(Loss) Per Basic Share ($0.12) ($0.19) $0.07 $0.00
Slide 23: Subsidiary KPIs - Q3 FY'20
Subsidiary KPIs — Q3 FY’20 Ratios Consolidated AU USU Revenues $12,537,940 +48 YOY $9,112,663 $3,425,277 Ratios as a Percentage of Total AGI Revenue Ratios as a Percentage of AU Revenue Ratios as a Percentage of USU Revenue Instructional costs $2,623,252 20.9 19.4% 25.0 Marketing costs $2,539,
Slide 24: Q3 FY'20 Net Loss to Adjusted EBITDA Reconciliation
Q3 FY’20 Net Loss to Adjusted EBITDA Reconciliation Net Loss ($2,281,052) Interest income, net 570,020 Taxes 98,173 Depreciation and Amortization 475,393 EBITDA (loss) ( $1,137,466) Bad Debt Expense 2,547 Stock - Based Compensation 347,210 Non - recurring Charges 1,010,124 Adjusted EBITDA $222,415