Aspen Group, Inc. · OTC:ASPU
Aspen — Q4 FY2020 Earnings Presentation
23 slides from Aspen's earnings presentation, Jul 7, 2020
Slide 1: Fourth Quarter Fiscal Year 2020 Earnings Slides
Fourth Quarter Fiscal Year 2020 Earnings Slides Michael Mathews, Chairman & Chief Executive Officer CREATING VALUE BY Frank J. Cotroneo, Chief Financial Officer TRANSFORMING THE COLLEGE Robert Alessi, Chief Accounting Officer July 7, 2020 EDUCATION EXPERIENCE 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 enrollments, bookings and ARPU
Slide 3: Key Takeaways for FY'20 Financial Results
KEY TAKEAWAYS FOR FY’20 FINANCIAL RESULTS • Enrollment growth in high LTV programs drove highly profitable FY’20 revenue growth • Combined with increased marketing efficiency ratio, gross margin rose by 800 bps • Along with moderate G&A growth, net income loss in FY’20 narrowed significantly • 34% o
Slide 4: Fourth Quarter Fiscal Year 2020 Operating Metrics
Aspen Group Inc. Fourth Quarter Fiscal Year 2020 Operating Metrics
Slide 5: Fourth Quarter Fiscal Year 2020 Highlights
Fourth Quarter Fiscal Year 2020 (Q4 FY’20) Highlights Positive EBITDA and Record Q4 FY’20 Adjusted EBITDA of $1.4 Million or 10% Margin Quarterly results for Q4 FY2020 versus Q4 FY2019 • Quarterly revenue grew by 38% to $14.1 million, and increased $1.5 million sequentially • Aspen BSN pre-licensure
Slide 6: AGI Active Student Body Grows to 11,444
AGI Active Student Body Grows to 11,444 Nursing Students Represent 85% of Total Student Body AU and USU Active Student Body* and Nursing Students by University AU and USU Active Student Body 9,487 9,274 9,016 8,261 7,784 7,862 7,562 7,299 6,595 6,164 1,678 1,759 1,848 1,957 1,407 1,491 1,605 1,702 1
Slide 7: Q4 FY'20 Marketing Efficiency Ratio Improvement
Q4 FY’20 Marketing Efficiency Ratio (MER)* Improvement Driven by 10% Decline in Cost of Enrollment Fourth quarter weighted average customer acquisition cost (CAC) fell by 10% year-over-year from $1,462 to $1,315 Marketing Efficiency Ratio MER % Enrollments CAC1 LTV2 Q4’20 MER Q4’19 MER Change Aspen
Slide 8: Q4 FY'20 High LTV Enrollment Drove 36% Bookings Growth
Q4 FY’20 High LTV ENROLLMENT DROVE 36% BOOKINGS GROWTH LIFTING ARPU BY 19% Q4 FY’20 ENROLLMENT Q4 FY’20 ARPU Q4 FY’20 Bookings* (in millions) 1,776 $14,973 1,560 $26.6 1,344 1,243 $19.6 $18.9 +19% $13.9 +36% +14% $12,558 +36% +8% +36% $7.7 432 $5.6 317 +38% Aspen USU Total Aspen USU Total Q4 FY2019
Slide 9: Full Year Fiscal Year 2020 Operating Metrics
Aspen Group Inc. Full Year Fiscal Year 2020 Operating Metrics
Slide 10: Fiscal Year 2020 Highlights
Fiscal Year 2020 (FY’20) Highlights Record FY’20 Adjusted EBITDA of $2.7 million or 6% margin Results for full year FY2020 versus full year FY2019 • FY’20 revenue increased by $15.0 million or 44% to $49.1 million • Annual bookings rose over 68% to $111.3 million, lifting ARPU by 19% to $14,973 • GA
Slide 11: FY'20 Bookings Growth and Increased ARPU
FY’20 BOOKINGS GROWTH AND INCREASED ARPU FUELED BY GROWTH IN HIGH LTV PROGRAM ENROLLMENTS Total Enrollments ARPU Total Bookings* (in millions) $14,514 7,668 $111.3 $11,391 5,802 +32% +27% +68% $66.1 FY2019 FY2020 FY2019 FY2020 FY2019 FY2020 *Bookings are defined by multiplying LTV by new student enr
Slide 12: Acceleration of Gross Profit Contribution
Acceleration of Gross Profit Contribution Gross Profit Rising Faster than Revenue FY 2 0 2 0 $49,061,080 • YoY Revenue increased by $15 million FY 2 0 1 9 or 44% $34,025,418 REVENUE +44% • YoY GAAP Gross Profit increased by YOY $28,848,786 $11.5 million or 67% $17,299,195 GROSS • Therefore 77% of re
Slide 13: G&A YOY Increase at 41% the Rate of Revenue Growth
G&A YOY Increase at 41% the Rate of Revenue Growth G&A Growth versus Revenue Growth (in 000’s) $49,061 • YoY Revenue increased by $15.0 million or $34,025 44% $30,330 • YoY G&A increased by $6.2 million or 26% $24,134 • G&A as a percent of revenue improved REVENUE from 71% to 62% GROWTH OF $15.0 • F
Slide 14: Q4 Fiscal Year 2020 Financial Results
Q4 Fiscal Year 2020 Financial Results
Slide 15: Q4 FY'20 Income Statement
Q4 FY’20 Income Statement Three Months Ended Change from Prior Year (FY’19) April 30, 2020 Dollar ($) Percent (%) Revenues $14,079,193 $3,865,051 38% Operating expenses Cost of revenues $5,431,182 $1,118,851 26% General and administrative $7,716,277 $1,420,452 23% Bad debt expense $780,005 $406,063
Slide 16: Q4 FY'20 Net Income, Adjusted EBITDA and EPS by Subsidiary
Q4 FY’20 Net (Loss)/Income, Adjusted EBITDA and EPS for Consolidated and Subsidiaries Consolidated AGI AU USU Net Profit/(Loss) $(664,563) $(3,208,902) $1,949,227 $595,112 Adjusted EBITDA $1,369,233 $(2,420,727) $3,101,183 $688,777 Net Profit/(Loss) Per Share, basic & diluted $(0.03) $(0.15) $0.09 $
Slide 17: Subsidiary KPIs—Q4 FY'20 Ratios
Subsidiary KPIs—Q4 FY’20 Ratios Consolidated AU USU Revenues $14,079,193 $9,988,306 $4,090,886 Ratios as a Ratios as a Ratios as a Percentage of Percentage of Percentage of Total AGI Revenue AU Revenue USU Revenue Instructional costs 19% 18% 21% Marketing costs 19% 18% 16% Depreciation and Amortizat
Slide 18: Q4 FY'20 Net Loss to Adjusted EBITDA Reconciliation
Q4 FY’20 Adjusted EBITDA and EBITDA Positive Q4 FY’20 Net Loss to Adjusted EBITDA Reconciliation Three Months Ended Change from Prior Year April 30, 2020 Dollar Percent Net Loss $(664,563) $945,360 -59% Interest expense $393,471 $108,034 38% Taxes $(10,688) $(10,688) NM Depreciation and Amortization
Slide 19: Full Year Fiscal Year 2020 Financial Results
Full Year Fiscal Year 2020 Financial Results
Slide 20: Full Year FY'20 Income Statement
Full Year FY’20 Income Statement Twelve Months Ended Change from Prior Year (FY’19) April 30, 2020 April 30, 2019 Dollar ($) Percent (%) Revenues $49,061,080 $34,025,418 $15,035,662 44% Operating expenses Cost of revenues 19,135,302 15,977,218 3,158,084 20% General and administrative 30,329,520 24,1
Slide 21: Full Year FY'20 Net Income, Adjusted EBITDA and EPS by Subsidiary
Full Year FY’20 Net (Loss)/Income, Adjusted EBITDA and EPS for Consolidated and Subsidiaries Consolidated AGI AU USU Net Profit/(Loss) $(5,659,065) $(11,984,182) $5,957,645 $367,472 Adjusted EBITDA $2,707,560 $(7,802,739) $9,067,803 $1,442,496 Net Profit/(Loss) Per Share, basic & diluted $(0.29) $(0
Slide 22: Subsidiary KPIs — Full Year FY'20 Ratios
Subsidiary KPIs — Full Year FY’20 Ratios Consolidated AU USU Revenues $49,061,080 $35,648,490 $13,412,589 Ratios as a Ratios as a Ratios as a Percentage of Percentage of Percentage of Total AGI Revenue AU Revenue USU Revenue Instructional costs 20% 18% 24% Marketing costs 19% 18% 14% Depreciation an
Slide 23: Full Year FY'20 Net Loss to Adjusted EBITDA Reconciliation
Full Year FY’20 Net Loss to Adjusted EBITDA Reconciliation Twelve Months Ended Change from Prior Year April 30, 2020 Dollar Percent Net Loss $(5,659,065) $3,619,152 -39% Interest expense $1,818,078 $1,376,117 311% Taxes $51,820 $42,544 459% Depreciation and Amortization $2,203,461 $33,363 2% EBITDA