Slide 1: FY10 Results Presentation
For personal use only FY10 RESULTS PRESENTATION
Slide 2: Agenda
AGENDA For personal use only 1. Business Overview 2. Strategy 3 3. Financial Summary 4. Property Portfolio 5 5. Funds Management 6. Outlook and Guidance Appendices 2 Aspen Group – 2010 FY Results
Slide 3: Business Overview
Business Overview For personal use only FY10 Operating EPS and DPS guidance g idance met 6.04 cps and 4.2 cps S Strong i cash operating h fl flows $31m ‐ up from $15m Asset A values l stabilised bili d “New look” executive team with a clear strategy Right platform to pursue solid earnings growth
Slide 4: Strategy
STRATEGY For personal use only Investment property portfolio provides continued source of recurring profits Look to increase quality of portfolio through recycling assets Focus on maintaining gearing within the target range of 25‐35% Leverage in‐house capabilities to expand in our core fund manageme
Slide 5: Financial Summary
For personal use only Financial Summaryy “FY10 Earnings & Distribution guidance met”
Slide 6: FY10 Results Overview
FY10 RESULTS OVERVIEW For personal use only Statutory profit after tax of $12.5m up from FY09 loss of ($64.5m) Operating profit before tax up 23% to $29.9m Operating EPS of 6.04cps and distributions of 4.2cps Net rental income from investment properties up 14% Funds management income down 34% given
Slide 7: FY10 Contribution by Segment
FINANCIAL SUMMARY FY10 Contribution by Segment For personal use only Revenue By Segment EBIT By Segment * Property Portfolio Funds Management *Based on operating EBIT by segment less Financial & Other Income proportionate share of Group overheads “Increase in Funds Management development activity wi
Slide 8: FY10 Income Contribution by Segment
FINANCIAL SUMMARY FY10 Income Contribution by Segment For personal use only $M FY06 FY07 FY08 FY09 FY10 “Solid earnings growth curtailed over the last 2 years due to a substantial drop in transactional fee income and equity profits” 8 Aspen Group – 2010 FY Results
Slide 9: Balance Sheet
FINANCIAL SUMMARY Balance Sheet For personal use only 30 June 10 30 June 09 Mvt Assets $m $m $m Current Assets Cash and Other 38.7 52.7 Non‐Current Investment Properties 379.2 368.6 Equity Investments 83.1 59.8 23.3 Inventories & assets held for sale 39.5 35.0 Loans to associates 73.0 67.7 Other 33.
Slide 10: Cashflow Summary
FINANCIAL SUMMARY Cashflow Summary For personal use only FY10 FY09 Mvt Note $m $m $m Cashflow from operating activities 31.1 15.0 16.1 1 Key cashflows from investing activities Payments for redevelopment works (15.7) (7.7) ‐8.0 Improvements to investment properties (6.0) (27.2) 21.2 Proceeds from sa
Slide 11: Summary of Group Debt Position
FINANCIAL SUMMARY Summary of Group Debt Position For personal use only 30 June 2010 30 June 2009 Core Debt Maturity (Nab) February 2012 February 2012 D Drawn D Debt bt $225 3 $225.3m $191 5 $191.5m Gearing (Target 25‐35%) 34% 30% Look through gearing 39% 40% Weighted Ave Cost of Debt 8.32% 7.24% Ear
Slide 12: Property Portfolio
For personal use only Property p y Portfolio “Strong tenancy profile and weighted towards resources based states of WA & SA”
Slide 13: Investment Property Portfolio Overview
INVESTMENT PROPERTY PORTFOLIO Overview For personal use only 14% uplift in net rental income on FY09 9% YOY net rental income growth Cap rates stabilised at 9.4% (9.4% 31 Dec 09) 100% of portfolio independently valued in FY10 resulting in a $3.7 million (or 1%) impairment to book value Solid leasing
Slide 14: Office Portfolio
INVESTMENT PROPERTY PORTFOLIO Office Portfolio For personal use only Septimus Roe Square (WA) Key Metrics 30 June 31 Dec 2010 2009 Retained and expanded six tenants Renewed leases at $475‐$485sqm vs $400‐$470sqm per Book value $233.2m $235.5m valuation Net Lettable Area 59,763 sqm 59,676 sqm Occupan
Slide 15: Industrial Portfolio
INVESTMENT PROPERTY PORTFOLIO Industrial Portfolio For personal use only Browns Road, Noble Park (Vic) Key Metrics 30 June 2010 31 Dec 2009 Terms agreed on further 35,000sqm of new leases and lease renewals in competitive market Book Value $81.8m $82.8m Increased occupancy from 65% (HY) to 100% Gros
Slide 16: Accommodation Village
INVESTMENT PROPERTY PORTFOLIO Accommodation Village For personal use only Aspen Karratha Village Key Metrics 30 June 2010 31 Dec 2009 Asset 100% leased to Woodside 11% uplift in net operating income (FY10 Value $44.0m $41.1m annualised) Occupancy 100% 100% 7% uplift on independent valuation WALE 3.5
Slide 17: Investment Property Strategies and Outlook
INVESTMENT PROPERTY PORTFOLIO Strategies and Outlook For personal use only Investment properties forecast to deliver more standard rental growth in FY11 FY 11 rental growth of 3.5%. Upside performance on closing out vacancies at Septimus Roe and Currie St Continued focus on active asset management i
Slide 18: Direct Development Portfolio Strategies and Outlook
DIRECT DEVELOPMENT PORTFOLIO Strategies and Outlook For personal use only Key Strategies & Outlook Portfolio comprises non‐core land assets valued at $39.4m Review of portfolio identified limited ability to achieve necessary scale in the short to medium medium‐term term Strategic decision to maximis
Slide 19: Funds Management
For personal use only Funds Management g “Development activity has gathered pace & set to deliver growth in FY11”
Slide 20: Funds Management Summary
FUNDS MANAGEMENT Funds Management Summary For personal use only Aspen Aspen Aspen ADF No.1 Living Parks Diversified Residential Development Tourism and Core Sector Estates Projects Accommodation Income 30 June 2010 Position Asset Value $315m $233m $271m $126m $14.3m $41.3m $15.7m $11.7m Aspen Equity
Slide 21: Funds Management Key Strategies
FUNDS MANAGEMENT Key Strategies For personal use only f Maintain and improve Fund performances Ensure budgeted performance is achieved across all Funds to meet investor expectations Achieve appropriate capital mix/gearing level for each Fund to reduce earnings risk f Expand distribution networks
Slide 22: Aspen Living FY10 Overview
FUNDS MANAGEMENT Aspen Living FY10 Overview For personal use only FY10 FY09 Assets under Management $315m $328m Lot settlements (Number) 751 34 Lot settlements (Gross Realisable Value) $18 5m1 $18.5m $9 0m $9.0m Total contribution to pre tax operating profit2 $6.8m $2.9m Aspen’s equity interest in S
Slide 23: Aspen Living - Outlook
FUNDS MANAGEMENT Aspen Living - Outlook For personal use only Key Metrics FY11 (f) FY10 (a) Lot settlements 393* 75 Average lot prices $200k‐$268k $200k‐$246k Gross Margin (pre interest) 23% 20% Gross Margin (after interest) 14% 10% Key Strategies & Outlook Stock Analysis FY11 (f) Undersupply is dri
Slide 24: ADF No.1 – FY10 Overview
FUNDS MANAGEMENT ADF No.1 – FY10 Overview For personal use only FY10 FY09 Assets under Management $233m $313m Total contribution to pre tax operating profit1 $2.8m $11.3m A Aspen’s ’ equity i iinterest iin FFund d 47% 43% ¹ Includes management fees + Aspen’s equity share of profits + interest income
Slide 25: ADF No.1 - Outlook
FUNDS MANAGEMENT ADF No.1 - Outlook For personal use only Key Metrics FY11(f) FY10 Assets under Management $183m $233m Revenues $49m $33m Key Strategies & Outlook Tower 8 – construction to commence 1H FY11 with fees recognised over the construction period once sold Construction expected to commence
Slide 26: Aspen Parks Property Fund – FY10 Overview
FUNDS MANAGEMENT Aspen Parks Property Fund – FY10 Overview For personal use only Jun 10 Jun 09 Assets under Management $271m $269m Total contribution to pre tax operating profit1 $7.5m $7.2m A ’ equity Aspen’s it iinterest t t iin FFund d 13% 17% ¹ Includes management fees + Aspen’s equity share of
Slide 27: Aspen Parks Property Fund - Outlook
FUNDS MANAGEMENT Aspen Parks Property Fund - Outlook For personal use only Keyy Metrics FY11(f) () FY10 Assets under Management $282m $271m Revenue $80.0m $72.6m EBITDA $27.9m $25.0m Key Strategies & Outlook Focus on organic development/acquisition opportunities ‐ $22m of developments/acquisitions b
Slide 28: Aspen Parks – Identified Development Programme
FUNDS MANAGEMENT Aspen Parks – Identified Development Programme For personal use only Aspen Group to project management the following proposed developments: BALMORAL (WA) Proposed 300 cabin accommodation village similar to Aspen Karratha Village Project cost estimate of $56m Seeking 10 year lease wi
Slide 29: Aspen Diversified Property Fund
FUNDS MANAGEMENT Aspen Diversified Property Fund For personal use only FY11(f) FY10 FY09 Assets under Management $121m $126m $156m Total contribution to pre tax operating profit1 $3.7m $4.5m $4.7m A Aspen’s ’ equity i iinterest iin FFund d 36% 36% 36% ¹ Includes management fees + Aspen’s equity shar
Slide 30: Outlook and Guidance
For personal use only Outlook a Outloo and d Gu Guidance da ce
Slide 31: APZ Value Proposition Metrics
APZ VALUE PROPOSITION METRICS For personal use only Yield at current security Cents per security Peer Group Averages* price ($0.47) Operating EPS FY10 6.0 12.8% 8.7% Distribution (70% payout ratio) 42 4.2 8 9% 8.9% 6 6% 6.6% Discount to NTA * 32% 9% * Comprising: ABP; CHC; IIF; GMG; CMW; PPC Sustain
Slide 32: Outlook & Guidance
OUTLOOK & GUIDANCE For personal use only Outlook Continuing stable rental income with limited risk More efficient and disciplined overhead cost structure to remain Early signs of funding becoming more available Funds Management growth through: Aspen Living – rebounding residential sector with good
Slide 33: Appendices
For personal use only Appendices Aspen Group – 2010 FY 33
Slide 34: Corporate Structure
APPENDIX 1 Corporate Structure For personal use only Aspen Group ASX: APZ ‐Funds management fee income Rental Income ‐ Investment income ‐ Interest income Property Portfolio Funds Management c$1 billion of assets under management under the following brands: Aspen Living Aspen Parks Investment Proper
Slide 35: Organisational Structure
APPENDIX 2 Organisational Structure For personal use only “Experienced and streamlined Senior Executive Team” Gavin Hawkins Managing Director Philip Barker Lino Brolese Jeff Holloway Jamie Smith Diniz Cardoso Chris Lewis Simon Martin General Manager Head Of Head of Company CEO Head of CFO Funds Comm
Slide 36: Income Statement (operating earnings)
APPENDIX 3 Income Statement (operating earnings*) For personal use only FY10 FY09 Change $m $m (%) Income from operations Rental income 51.3 43.0 19 Direct development 0.8 ‐ ‐ Funds management 12 6 12.6 19 2 19.2 (34) Other income 7.8 8.0 (2) Total Income 72.5 70.2 3 Expenses Direct property expense
Slide 37: Reconciliation of Operating Profit to Headline Profit
APPENDIX 4 R Reconciliation ili i off O Operating i P Profit fi to H Headline dli P Profit fi For personal use only FY10 2H10 1H10 FY09 Note ($M) ($M) ($M) ($M) Operating Net Profit 33.6 18.0 15.6 33.2 Swap revaluations (1 2) (1.2) (1 8) (1.8) 06 0.6 (8 3) (8.3) Property revaluations (6.1) (3.9) (2.
Slide 38: Summary of Group Debt Facilities
APPENDIX 5 Summary of Group Debt Facilities For personal use only Aspen Group Facility Purpose Maturity Hedging ICR LVR Covenants Facilities Limit (interest) NAB Core Long Term Core ICR 1.5x $213m Feb‐12 Facility Facility LVR 69% to maturity 71% 2.0x* 59% As per core facility NAB Karratha $19.5m Kar
Slide 39: Summary of Investment Properties
APPENDIX 6 Summary of Investment Properties For personal use only Latest Independent 2H10 Change to Valuation Book Value Book Value Cap Rate WALE Occupancy Property Date ($m) (%) (%) (yrs) (%) Septimus Roe, WA Dec 09 87.0 (0.2) 9.25 2.54 90 Alcoa Office Complex, Complex WA Dec 09 28 0 28.0 ‐ 9 00 9.
Slide 40: Key Metrics – Investment Property Portfolio
APPENDIX 7 Key Metrics – Investment Property Portfolio For personal use only Portfolio Geographic Diversification Portfolio Sector Diversification Tenancy Profile By Value By Value By Value “Key metrics support sustainability of recurring income streams” 40 Aspen Group – 2010 FY Results
Slide 41: Lease Profile - Investment Property Portfolio
APPENDIX 8 Lease Profile - Investment Property Portfolio For personal use only 30 June 2010 WALE 3.1 yrs Occupancy 95% Lease Expiry Financial % of Year Income Centrelink FY11 5.13% AWH* FY12 11.6% Minister for Works FY14 6.9% Woodside** FY14 21.0% Alcoa Australia FY14 2.7% “Actively engaged with cur
Slide 42: c$1.0 billion of assets under management
APPENDIX 9 c$1.0 billion of assets under management For personal use only Aspen Living ADF No.1 Residential Developments 4 Assets (AUM $315M) $ 14 Assets (AUM $233M) $ Aspen Parks Aspen Diversified Tourism & Core Income Accommodation 9 Assets (AUM $126M) 25 Assets (AUM $271M) 42 Aspen Group – 2010 F
Slide 43: Aspen Living - Pipeline
APPENDIX 10 Aspen Living - Pipeline For personal use only Development timeframe by Estate (Lots remaining and GRV) Dunsborough Lakes 1,045 lots GRV $450m 797 lots Seaside Fernbay GRV $255m 1,063 lots St Leonards Estate GRV $322m $ Whitsunday Shores 838 lots Estate GRV $297m All estates are well esta
Slide 44: ADF No.1 - Forecast Development Timetable
APPENDIX 11 ADF No.1 - Forecast Development Timetable For personal use only FY11 FY12 FY13 FY14 FY15 GRV Project Sector $m Byford on the Scarp Residential Land Subdivision 84 Chittering Rural Residential Land Subdivision 42 Upper Swan Subdivision Land Bank 43 Mariner Apartments 50% interest Tourist
Slide 45: Additional Fund Metrics
APPENDIX 12 Additional Fund Metrics For personal use only Aspen Fund Bank Maturity Total Assets Drawn Debt Gearing** Gearing Hedging Aspen Dunsborough Lakes* Nab FY11 $91m $40m 44% 50% Aspen Whitsunday Shores* Nab FY12 $51m $6m 12% ‐ Fern Bay Seaside Village* Bankwest FY12 $83m $33m 40% 70% St Leona
Slide 46: Disclaimer
DISCLAIMER For personal use only This presentation Thi i has h been b preparedd by b Aspen A G Group (“A (“Aspen”) ”) and d should h ld not beb considered id d ini any way to be an offer, invitation, solicitation or recommendation with respect to the subscription for, purchase or sale of any securit