Aspen Group, Inc. · OTC:ASPU
Aspen — Investor Presentation (August 2019)
31 slides from Aspen's investor presentation, Aug 8, 2019
Slide 1: Investor Presentation August 8, 2019
Investor Presentation August 8, 2019 Nasdaq : ASPU 1
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 regarding continued growth in nursing opportunities, expected increas
Slide 3: Aspen Group, Inc. education technology holding company
Aspen Group, Inc. is an education technology holding company that leverages its infrastructure and expertise to allow its two universities, Aspen University and United States University, to deliver on the vision of making college affordable again . 3
Slide 4: Aspen Group, Inc. – History
Aspen Group, Inc. – History 2011 – 2012 2014 2017 2018 4 Michael Mathews appointed CEO of Aspen University; AGI is formed and begins trading on OTCQB (ASPU) Aspen University announces t he breakthrough Monthly Payment Plan (MPP) Aspen University grows its online post - licensure Nursing school from
Slide 5: Disruptive Business Model Making College Affordable with Outstanding Student Outcomes
5 Disruptive Business Model Making College Affordable with Outstanding Student Outcomes
Slide 6: ASPU's monthly payment plans are a revolutionary concept in for-profit education
ASPU’s monthly payment plans are a revolutionary concept in for - profit education 6 Degree Program Monthly Payment ($) # of Months (tuition)* Tuition ($) RN to BSN (AU, USU) 250 (AU) or 47 (USU) 9,750 (AU) or 11,700 (USU) MSN (AU, USU) 325 (AU) or /40 (USU) 11,700 (AU) or 12,350/13,000 (
Slide 7: 68% of ASPU's active students pay monthly, for a total contractual value >$50mm
68% of ASPU’s active students pay monthly, for a total contractual v alue >$50mm 7 5,168 5,588 5,861 6,162 6,633 7,274 7,950 8,354 8,932 9,752 - 2,000 4,000 6,000 8,000 10,000 12,000 July '18 October '18 January '19 April '19 July '19 Total Monthly Payment Students* Monthy Paying Students - Aspen U
Slide 8: Aspen's low cost of enrollment is driven by its in-house internet advertising and CRM system
Aspen’s low cost of enrollment is driven by its in - house internet advertising and CRM system 8 The durability of this competitive advantage can be seen in the industry - leading conversion rate The traditional marketing approach of an online educator has been to purchase leads from third party pro
Slide 9: Student outcomes are key to our success
Student outcomes are key to our success 9 Upon completing their studies, % of alumni that responded they achieved the goals they had when they started the course or program 97% Student Satisfaction Compared to the national average of 60% of students who began a bachelor’s degree at a 4 - year instit
Slide 10: Targeting the High Growth Nursing Profession
Targeting the High Growth Nursing Profession 10
Slide 11: The aging population is fueling strong demand for nurses
The aging population is fueling strong demand for nurses 11 The Bureau of Labor Statistics (BLS) estimated in 2016 that the demand for RNs will grow by 15% over the next decade to ~3.4mm; this situation is exacerbated by the high percentage of RNs who are approaching retirement age (>30% over 50) A
Slide 12: Highly educated nurses are in demand – with salaries to match
Highly educated nurses are in demand – with salaries to match 12 Degree Avg. Salary*** Purpose # Students* Associate $67,463 Minimum qualification required to become an RN n/a Pre - Licensure BSN $77,249 Undergraduate degree for those with no experience 201,517 RN to BSN $77,249 Designed for RNs to
Slide 13: Higher salaries and demonstrated ROI incentivize higher graduation rates
Higher salaries and demonstrated ROI incentivize higher graduation rates 13 Degree Program Program Cost ($) Salary Uplift ($)* Payback ( yrs ) RN to BSN 9,750 9,786 1.00 MSN 11,700 16,260 0.72 DNP 18,900 21,577 0.88 MSN - FNP (USU) 27,000 27,361 0.98 These short payback periods demonstrate how by co
Slide 14: Nursing students represent 82% of ASPU's total student body
Nursing students represent 82% of ASPU’s total student body* 14 4,863 5,466 5,718 6,164 6,595 6,590 7,107 7,393 7,784 8,261 582 740 868 1,049 1,407 684 843 961 1,148 1,491 - 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 9,000 July '18 October '18 January '19 April '19 July '19 AU and USU Active St
Slide 15: With two new nursing programs, ASPU expanded TAM to more than $4bn
With the addition of two new nursing programs, ASPU dramatically expanded TAM to more than $4bn 15 Launched CCNE Accredited Degree Program Market Size ($) 2011 Q4 2013 2012 Q4 2014 Master of Science in Nursing (MSN) Bachelor of Science in Nursing (RN to BSN) 478mm 2017 In Progress Doctor of Nursing
Slide 16: Aspen University entered the >$3bn BSN Pre-Licensure campus business in July 2018
16 Aspen University entered the >$3bn BSN Pre - Licensure campus business in July 2018
Slide 17: By offering a hybrid BSN P-L degree, Aspen has created an affordable offering in a >$3bn market
By offering a hybrid BSN P - L degree, Aspen has created an affordable offering in a >$3bn market 17 The AACN has estimated that there are 190,000 qualified entry level nursing students in the United States annually; however, there is only capacity amongst US nursing schools to accept 70% of worthy
Slide 18: Hybrid BSN P-L program delivers $30,000 LTV per enrollment
Hybrid BSN P - L program d elivers $30,000 LTV per enrollment 18 670 active students in program as of 7/31/19 Estimating 90%+ grad rate among final two - year clinical students, and a 2/3’s matriculation rate among first - year prereq students) Assuming each campus 3 - years out has 600 active stude
Slide 19: Aspen has ample opportunity to invest in its business at very attractive ROIs
Aspen has ample opportunity to invest in its business at very attractive ROIs 19 RN to BSN / MSN Doctoral MSN - FNP (USU) Revenue / Enrollment* 7,350 12,600 17,820 Marketing Cost / Enrollment* (1,231) (1,987) (1,078) Enrollment Advisor* Instructional Costs** Contributio
Slide 20: FY'18 v. FY'19 — Enrollments Increased 36%, Total Bookings Increased 90%
FY’18 v. FY’19 — Enrollments Increased 36%, While Total Bookings* Increased 90% 20 4,254 5,802 - 1,000 2,000 3,000 4,000 5,000 6,000 7,000 FY'2018 FY'2019 Total Enrollments $34,807,500 $66,091,350 $- $10,000,000 $20,000,000 $30,000,000 $40,000,000 $50,000,000 $60,000,000 $70,000,000 FY'2018 FY'2019
Slide 21: FY'18 v. FY'19 — ARPU Increased 9%
FY’18 v. FY’19 — Average Revenue Per User (ARPU) Increased 39% Y/O/Y, from $8,182 to $11,391 21 Lifetime Value (LTV) FY'2018 FY'2018 FY'2019 FY'2019 Per Enrollment Enrollments Bookings* Enrollments Bookings* AU Online (Nursing + Other) Unit $ 7,350 3,858 $ 28,356,300 3,825 $ 28,113,750 AU (Doctoral)
Slide 22: Q1 FY'2020: Enrollments Rise 46% and Bookings Increase 83%
Q1 FY’2020: Enrollments Rise 46% and Bookings Increase 83% Y/O/Y, ARPU Increases to $13,919 22 Lifetime Value (LTV) Q1 FY'2020 Q1 FY'2020 Per Enrollment Enrollments Bookings* AU Online (Nursing + Other) Unit $ 7,350 941 $ 6,916,350 AU (Doctoral) Unit $ 12,600 198 $ 2,494,800 AU (Pre - Licensure BSN)
Slide 23: ASPU fiscal Q4 highlights: 20% sequential growth and positive Adjusted EBITDA
ASPU fiscal Q4 highlights: 20% sequential growth and return to delivering positive Adjusted EBITDA 23 Sequential Financial Results Q3 FY’2019 Q4 FY’2019 Revenue $ 8.5 million $ 10.2 million Net (Loss)/Income $ (2.4) million $ (1.6) million EBITDA $ (1.7) million $ (0.7) million Adjusted EBITDA $ (1.
Slide 24: Proven Management Team
Proven Management Team 24 • Former CEO of Interclick ( Nasdaq : ICLK, 2007 - 2011), sold to Yahoo! in 2011 for $270mm • Former Operating Exec of CKS Partners ( Nasdaq : CKSG, 1994 - 1998), sold to USWeb in 1998 for $344mm Michael Mathews Dr. Cheri St . Arnauld Chairman & Chief Executive Officer • Fo
Slide 25: Equity Snapshot
Equity Snapshot 25 As of 8/6/19 Ticker on Nasdaq : ASPU Share Price: $4.09 52 Week Range: $3.58 - $ 8.20 Market Cap: $76 Million Shares Outstanding: 18.6 Million Mgmt & BOD Ownership:
Slide 26: Appendix
GROUP INC. Appendix 25
Slide 27: Q4 Fiscal Year 2019 Financial Results
Q4 Fiscal Year 2019 Financial Results 27
Slide 28: Q4 Fiscal Year 2019 Results
Q4 Fiscal Year 2019 Results 28 For the Quarter Ended April 30, 2019 Revenues $ 10,214,143 Operating expenses Cost of revenues 4,312,332 General and administrative 6,669,767 Depreciation and amortization 592,634 11,550,238 Operating loss from operations (1,360,590) Other income (expense): Other incom
Slide 29: Net (Loss)/Income, Adjusted EBITDA and EPS
Net (Loss)/Income, Adjusted EBITDA and EPS 29 Consolidated AGI AU USU Net (Loss)/Income $ (1,609,923) $ (2.21M) $ 1.11M $(0.51M) Adjusted EBITDA $ 72,933 $ (1.61M) $ 1.77M $(0.09M) Net Loss Per Share ($0.09)
Slide 30: Subsidiary KPIs — Q4 FY'19
Subsidiary KPIs — Q4 FY’19 Ratios 30 Consolidated AU USU Revenues $10,214,143 +41 YOY Ratios as a Percentage of Total AGI Revenue Ratios as a Percentage of AU Revenue Ratios as a Percentage of USU Revenue Instructional costs $1,974,846 19.3 17.5 25.5 Marketing costs $2,337,486 22.9 1.4
Slide 31: Net Loss to Adjusted EBITDA Reconciliation (Q4 FY'19)
Net Loss to Adjusted EBITDA Reconciliation (Q4 FY’19) 31 Net Loss ($1,609,923) Interest Expense 285,437 Taxes _ Depreciation & Amortization 592,634 EBITDA (731,852) Bad Debt Expense 373,942 Stock - Based Compensation 324,256 Non - recurring Charges 106,589 Adjusted EBITDA (Loss) $72,933