Slide 1: Aspen Group 2007 Annual Results
For personal use only Aspen Group 2007 Annual Results “Creating wealth through intelligent property investment” 1 “Creating wealth through intelligent property investing” Annual Results 2007
Slide 2: Contents
Contents For personal use only 1. Corporate Structure 2. Highlights 3. Financial Summary 4. Property Portfolio 5. Funds Management 6. Summary 7. Appendix 1 – Property Portfolio 2 “Creating wealth through intelligent property investing” Annual Results 2007
Slide 3: Corporate Structure Overview
1. Corporate Structure Overview For personal use only Investment Funds Equity Property Management Investments % Revenue 56% 44% Included in funds management ¾ Portfolio of diversified ¾ Driving DPU and EPU Growth ¾ Co-invests in funds property assets ¾ Efficient use of capital – Strategic stakes ¾ C
Slide 4: Contents
Contents For personal use only 1. Corporate Structure 2. Highlights 590 540 APZ S&P 200 Prop 490 3. Financial Summary 440 390 340 4. Property Portfolio 290 240 190 140 5. Funds Management 90 Dec-02 Jun-03 Dec-03 Jun-04 Dec-04 Jun-05 Dec-05 Jun-06 Dec-06 Jun-07 6. Summary 7. Appendix 1 – Property Por
Slide 5: Highlights: Year in Review
2. Highlights Year in Review For personal use only ¾ 18% growth in property portfolio on $46.1m of revaluations ¾ Underlying EPS increased 22% ¾ DPS increased 28% ¾ Underlying EPS 23% above DPS ¾ Acquisition and successful syndication of three residential land estates ¾ Significant growth in existin
Slide 6: Financial Performance
2. Highlights Financial Performance For personal use only FY FY % 2007 2006 Change Net Profit After Tax 73.82 34.49 Å 114% Underlying Net Profit* ($’m) 33.49 18.47 Å 81% Underlying EPS* (cents) 15.62 12.81 Å 22% DPS (cents) 12.75 10.00 Å 28% Underlying Earnings above 2.87 2.81 Å 2% Distribution (cen
Slide 7: Financial Position
2. Highlights Financial Position For personal use only FY FY % 2007 2006 Change Gross Assets Under Management ($’m) 1,224 620 Å 97% Investment Property (Revaluations) ($’m) 336 284 Å 18% Gearing 31% 47% Æ 16% NTA (cents) 132 101 Å 31% 7 “Creating wealth through intelligent property investing” Annual
Slide 8: Security Price Performance
2. Highlights Security Price Performance For personal use only Aspen continues to outperform ASX/S&P 200 Property Index Total Returns 590 540 APZ S&P 200 Prop 490 440 390 340 290 240 190 140 90 Dec-02 Jun-03 Dec-03 Jun-04 Dec-04 Jun-05 Dec-05 Jun-06 Dec-06 Jun-07 8 “Creating wealth through intellige
Slide 9: Acquisitions in FY07
2. Highlights Acquisitions in FY07 For personal use only 12 acquisitions for $463.9 million $m ¾ Aspen Living Fern Bay, NSW – 882 lots (on completion value of $260m) $76.6 West Swan, WA - 1152 lots (on completion value of $364m) $36.0 Whitsunday Shores, QLD – 669 lots (on completion value of $
Slide 10: Aspen Group – Track Record
2. Highlights Aspen Group – Track Record For personal use only Aspen continues to drive earnings and distribution growth FY04 (¢) FY05 (¢) FY06 (¢) FY07 (¢) 3YR CAGR EPS* 8.4 +4.2% 8.75 +46.4% 12.81 +21.9% 15.62 23.0% DPS 7.25 +15.2% 8.35 +19.8% 10 +27.5% 12.75 20.7% NTA 70 +15.7% 81 +25.2% 101.4 +3
Slide 11: Contents: EPS/DPS Growth Profile
Contents For personal use only 1. Corporate Structure EPS/ DPS Growth Profile 16 15.6 15.5 2. Highlights 4 Year EPS CAGR 20.5% 14 12.8 12.8 3. Financial Summary 12 4 Year DPS C e n t s P e r S e c u rit y CAGR 22.8% 10.0 10 8.8 8.4 8.4 4. Property Portfolio 8 7.4 7.3 5.6 6 5. Funds Management 4 FY03
Slide 12: Financial Performance
3. Financial Summary Financial Performance For personal use only FY07 ($M) FY06 ($M) Change % Income Rental income 31.63 20.41 Funds management - Establishment 14.57 9.49 Funds management - Recurring 9.83 6.08 Property revaluations 46.10 24.99 Total Income 102.13 58.48 75% Å Expenses Direct property
Slide 13: Reconciliation of Net Profit After Tax to Underlying Earnings
3. Financial Summary Financial Performance For personal use only Reconciliation of Net Profit After Tax to Underlying Earnings FY07 ($M) FY06 ($M) Change % Profit per Accounts 73.82 34.49 Less Swap revaluations (2.04) (2.48) Property revaluations (net of tax) *(39.95) (14.25) Plus Share option expen
Slide 14: Financial Position
3. Financial Summary Financial Position 30 Jun 07 30 Jun 06 Change % For personal use only Assets Current Loans to Fund Mgt Vehicles 56.5 m 29.8 m 90% Å Other current assets 30.7 m 10.6 m 189% Å Non Current Investment Properties 335.8 m 284.3 m 18% Å Equity Investments 93.3 m 24.0 m 288% Å Inventori
Slide 15: Capital and Debt
3. Financial Summary Capital and Debt For personal use only Capital Structure 30 Jun 07 Stapled Securities on Issue 247.1 million Unlisted Options on Issue 0.2 million Market Cap (at $2.56 closing price, 29 June 2007) $632 million Total Securityholders Circa 3,600 Institutional 66% Retail 34% Debt P
Slide 16: Contents
Contents For personal use only 1. Corporate Structure 2. Highlights 3. Financial Summary 4. Property Portfolio 5. Funds Management 6. Summary 7. Appendix 1 – Property Portfolio 16 “Creating wealth through intelligent property investing” Annual Results 2007
Slide 17: Property Portfolio Overview
4. Property Portfolio Overview For personal use only ¾ Strong revaluation performance in FY07 – 18% increase ¾ Secure lease expiry profile of 4.65 years ¾ St Kilda Rd. tenant risk (Hewlett Packard) eliminated with 10 yr L’Oreal lease ¾ Occupancy rate 96% across portfolio ¾ Sound sector and geographi
Slide 18: Property Portfolio Summary
4. Property Portfolio Summary For personal use only Book Value Location Sector Occupancy A$ millions Septimus Roe Square Perth, WA Office 76.6 100% Alcoa Office Complex Booragoon, WA Office 22.9 100% 564 St. Kilda Road Melbourne, VIC Office 27.6 100% 33 York Street Sydney, NSW Office 3.2 100% Elders
Slide 19: Leasing Profile
4. Property Portfolio Leasing Profile For personal use only Lease expiry profile by financial year 30% 25% Lease % of 20% Key Tenants Expiry Income Elders 2012 16% 15% DIMIA 2015 7% 10% Alcoa 2014 6% L’Oreal 2018 5% 5% Centrelink 2011 5% Total 39% 0% 2008 2010 2012 2014 2016 2018 2020 19 “Creating w
Slide 20: Diversification
4. Property Portfolio Diversification For personal use only 20 “Creating wealth through intelligent property investing” Annual Results 2007
Slide 21: Contents
Contents For personal use only 1. Corporate Structure 2. Highlights 3. Financial Summary 4. Property Portfolio 5. Funds Management 6. Summary 7. Appendix 1 – Property Portfolio 21 “Creating wealth through intelligent property investing” Annual Results 2007
Slide 22: Funds Management Overview
5. Funds Management Overview For personal use only ¾ Leverages Aspen’s core property management expertise ¾ Provides investment opportunities not really available to investors ¾ Important source of EPS/DPS growth with efficient use of Aspen’s capital ¾ Unlisted open ended Funds provide a natural gro
Slide 23: Contribution to Income and Asset Growth
5. Funds Management Contribution to Income and Asset Growth For personal use only Funds Management Income Funds Management Asset Size 30 1000 25 24.4 882.9 20 750 15.6 $m 15 $m 500 10 333.2 250 5 4.0 81.6 0 0 2005 2006 2007 2005 2006 2007 Financial Year Financial Year 23 “Creating wealth through int
Slide 24: Divisions
5. Funds Management Divisions For personal use only Aspen Aspen Aspen Aspen Aspen Aspen Branding Parks Diversified Living Developments Villages Communities Development Affordable Retirement Sector Resort Park Core Income Syndicated Land Fund Series Living/Retirement Aged Care Asset value $163 millio
Slide 25: Distribution Channels
5. Funds Management Distribution Channels For personal use only Funds raised by Aspen Managed Funds Cumulative 220 200 180 ¾ Head of Distribution appointed November 160 2006 Retail 140 Wholesale ¾ BDM’s increased to 5 120 #039;M ¾ Direct and in-house sales 100 80 ¾ Proven capacity in retail and wholesa
Slide 26: New Initiatives
5. Funds Management New Initiatives For personal use only Wholesale versions of Aspen Parks and Aspen Diversified ¾ Designed to be platform friendly ¾ Targeting personal superannuation investors and model portfolios ¾ Growing popularity of Aspen Parks with financial planners as a portfolio diversifi
Slide 27: Aspen Parks Property Fund: Strategy
5. Funds Management Aspen Parks Property Fund For personal use only Strategy ¾ Strategic land holds - Parks generally in excellent locations with potential for capital appreciation ¾ Potential to develop excess land and generate capital upside ¾ Fragmented industry providing asset growth potential ¾
Slide 28: Aspen Parks Property Fund
5. Funds Management Aspen Parks Property Fund For personal use only Coral Bay Monkey Mia Wallamba Coogee River 28 “Creating wealth through intelligent property investing” Annual Results 2007
Slide 29: Aspen Parks Property Fund
5. Funds Management Aspen Parks Property Fund For personal use only 29 “Creating wealth through intelligent property investing” Annual Results 2007
Slide 30: Aspen Parks Property Fund
5. Funds Management Aspen Parks Property Fund For personal use only 30 “Creating wealth through intelligent property investing” Annual Results 2007
Slide 31: Aspen Diversified Property Fund: Strategy
5. Funds Management Aspen Diversified Property Fund For personal use only Strategy ¾ Leverages Aspen’s core commercial property expertise ¾ Target properties in the $5 – $30 million range (too large for individual investors but too small for LPTs, institutional investors) ¾ Competitive distribution
Slide 32: Aspen Diversified Property Fund Properties
5. Funds Management Aspen Diversified Property Fund For personal use only Property Location Use Acquisition Date Book Value Springvale Road Mulgrave, VIC Industrial Jun 2007 $20.0m Homemaker City Castle Hill NSW Retail Feb 2006 $28.0m Holeproof Complex Nunawading VIC Industrial Dec 2005 $28.0m Mount
Slide 33: Aspen Diversified Property Fund
5. Funds Management Aspen Diversified Property Fund For personal use only 33 “Creating wealth through intelligent property investing” Annual Results 2007
Slide 34: Aspen Living
5. Funds Management Aspen Living For personal use only Aspen Aspen Fern Bay West Swan Seaside Dunsborough Whitsunday Total Estate Lakes Shores Village Number of Lots 1,190 669 960 882 3,701 Remaining Gross Realisable 422 198 302 268 1,190 Value ($’m) Location Bowen Perth Stockton Dunsborough WA QLD
Slide 35: Aspen Living: Strategy
5. Funds Management Aspen Living For personal use only Strategy ¾ Leverages Aspen’s expertise in residential subdivision to provide attractive returns to investors and long term recurring funds management income for Aspen. ¾ Aim to acquire advanced developments which are revenue generating at purcha
Slide 36: Aspen Living
5. Funds Management Aspen Living For personal use only Aspen Dunsborough Lakes 36 “Creating wealth through intelligent property investing” Annual Results 2007
Slide 37: Aspen Living: Fern Bay, Seaside Village, Whitsunday Shores
5. Funds Management Aspen Living For personal use only Fern Bay Seaside Village Whitsunday Shores 37 “Creating wealth through intelligent property investing” Annual Results 2007
Slide 38: Aspen Development Fund No1
5. Funds Management Aspen Developments For personal use only Aspen Development Fund No1 Background ¾ Acquisition of the Caversham Property Group (property division of Futuris) ¾ Settled May 2007 ¾ Off market transaction ¾ First in series of proposed development funds Key Elements of Futuris Transact
Slide 39: Aspen Development Fund No.1 Portfolio Breakdown
5. Funds Management Aspen Developments For personal use only Aspen Development Fund No.1 Portfolio Breakdown Estimated Key Location Value Projects Residential Subdivisions $64.4 million - Byford By The Scarp WA - Chittering Valley WA - Geraldton WA Commercial Construction $71.5 million - City Centra
Slide 40: Aspen Developments
5. Funds Management Aspen Developments For personal use only 40 “Creating wealth through intelligent property investing” Annual Results 2007
Slide 41: Campbelltown Private Hospital
5. Funds Management Aspen Developments For personal use only Campbelltown Private Hospital 41 “Creating wealth through intelligent property investing” Annual Results 2007
Slide 42: Campbelltown Retirement Village
5. Funds Management Aspen Developments For personal use only Campbelltown Retirement Village 42 “Creating wealth through intelligent property investing” Annual Results 2007
Slide 43: Aspen Villages: Strategy
5. Funds Management Aspen Villages For personal use only Strategy ¾ Management of the development of residential accommodation villages ¾ Acquisition of sites through development land controlled by Aspen (eg. Aspen Parks and Aspen Living) but will also acquire sites from third parties ¾ Baby boomers
Slide 44: Aspen Communities: Strategy
5. Funds Management Aspen Communities For personal use only Strategy ¾ Launched August 2007 to manage the development of retirement and aged care facilities ¾ 200-300 home villages on 7-12ha land ¾ Utilise development expertise of Aspen Developments (formerly Caversham Property) ¾ Capitalise on stro
Slide 45: Contents
Contents For personal use only 1. Corporate Structure 2. Highlights 3. Financial Summary 4. Property Portfolio 5. Funds Management 6. Summary 7. Appendix 1 – Property Portfolio 45 “Creating wealth through intelligent property investing” Annual Results 2007
Slide 46: Personnel
6. Summary Personnel For personal use only BOARD OF DIRECTORS Reg Gillard Non-executive Chairman Terry Budge Non-executive Director Angelo Del Borrello Managing Director Seng Fai Chan Non-executive Director Gavin Hawkins Executive Director Finance Matthew McCann Non-executive Director (appointed Aug
Slide 47: DPS and EPS Track Record
6. Summary DPS and EPS Track Record For personal use only EPS/ DPS Growth Profile 16 15.6 15.5 4 Year EPS Earnings and distribution growth has CAGR 20.5% 14 been driven by: 12.8 12.8 ¾ Growth in the funds management business 12 4 Year DPS C e n t s P e r S e c u rit y ¾ Expansion of syndicated land
Slide 48: Strong Asset Growth
6. Summary Strong Asset Growth For personal use only Assets Under Management ($m) 1,400 ¾ Strong pipeline of acquisitions for funds 1,200 ¾ Extensive networks to source deal 1,000 flow ¾ Proven ability to develop unique funds 800 ¾ Strong team of professionals 600 ¾ Proven capital raising track reco
Slide 49: Outlook
6. Summary Outlook For personal use only ¾ Strong balance sheet will enable further asset acquisition opportunities for investment portfolio ¾ Growth from new and existing funds management initiatives ¾ Focus on earnings growth through astute investment selection (not just growth for growth's sake)
Slide 50: 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
Slide 51: Appendix Property Portfolio: Office
Appendix 1 Property Portfolio Office For personal use only St. Kilda Rd, Melbourne Septimus Roe Square, Perth Building Area 8,470 sqm plus 173 car parking bays Building Area 16,883 sqm plus 126 car bays Tenants 38 tenants including BankWest, Tenants L’Oreal Subway, Dome Cafe, Sun, State Police Conne
Slide 52: Office Update
Appendix 1 Property Portfolio Office Update For personal use only Currie Street ¾ Re-valued by $10m to $77m as a result of yield compression in the Adelaide commercial market and increased leasing activity in the building ¾ Take up of vacant area by existing tenants Septimus Roe Square ¾ Strong Pert
Slide 53: Appendix Property Portfolio: Industrial
Appendix 1 Property Portfolio Industrial For personal use only Elders Woolstores, Fremantle Noble Park. Melbourne Rocklea, Brisbane Building Area 100,800 sqm Building Area 42,747 sqm plus 400 parking bays Building Area 14,555 sqm plus 150 car bays Tenant Elders Limited (subsidiary of Futuris Limited
Slide 54: Industrial Update
Appendix 1 Property Portfolio Industrial Update For personal use only Elders Woolstores ¾ Revaluation by $12.5 m to $57.5m due to: ¾ Yield compression in WA industrial property market due to supply shortage ¾ Substantial increase in surrounding land values and redevelopment activity of both light in
Slide 55: Appendix Property Portfolio: Retail
Appendix 1 Property Portfolio Retail For personal use only Garden Town, Toowoomba Building Area Tenants 12.434sqm plus 750 car bays Super IGA Supermarket, two sub-major ¾ Tenant re-mix opportunities to be pursued and multiple speciality tenancies Occupancy 86% ¾ Food court redevelopment planned Book