For personal use only Presentation · 2012-02-23 · 5.4%. 10.8%: Funds Management Total. 949: 9.18. 7.71: 152.54. 12.0%: 9.0%. 1H2012 Contribution by Segment. Aspen Group – 1H2012

2012 Half Year Results Presentation

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1. Performance Overview

2. Financial Summary

3. Property Portfolio

4. Funds Management

5. Outlook and Guidance

6. Appendices

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Performance Overview

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PERFORMANCE OVERVIEW

Aspen Group – 1H2012 Results

Financial Highlights

− Operating profit after tax of $18.6 million, up 13.5%

− Statutory profit to $13.7 million, up 77.8%

− Operating EPS 3.16 cents per security, up 8.0%

− ICR of 3.8 times

− NTA $0.68

Performance Highlights− Telstra Super JV settled and financing secured on ATO Building

− ATO Building now 71% complete and on budget

− Non-core asset sales continued

− Property portfolio uplift of $16.7 million

− Increase in funds management fee income of 17.3% to $7.4 million

− Strong retail equity inflows – up 44% on prior corresponding period

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− Investment Property portfolio EBITDA down 13% on 1H2011 - sale of two properties in second half of FY11

− Funds Management EBITDA up 19% to $9.18m – stronger 2nd half expected especially Aspen Living

AUM$m

EBITDA1H12 1H11 $m $m

Ave FundsEmployed

$m

ROC1H12

%

ROC1H11

%

Investment Property 323 15.04 17.36 372.51 8.1% 8.3%

Funds Management

Aspen Living Residential Land 298 3.74 2.94 74.13 10.1% 8.7%

Aspen Parks Accomodation Parks 290 3.23 2.55 18.88 34.3% 31.2%

ADF No 1 Diverse Development 239 1.61 0.44 37.11 8.7% 1.6%

Aspen Diversified 1 Core Income 122 0.60 1.78 22.42 5.4% 10.8%

Funds Management Total 949 9.18 7.71 152.54 12.0% 9.0%

1H2012 Contribution by Segment

Aspen Group – 1H2012 ResultsNote 1. Aspen Diversified consolidated from 31 October 2011 so funds management income for part period only

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► Group

− Continued focus on non-core asset sales to enhance liquidity

− Looking to reduce financing costs

► Property Portfolio

− Maximise expected strong reversionary rents, particularly WA assets

− Capture strong rental upside through lease up of the Woolstores site to be rebranded the “Spearwood Industrial Estate”

► Funds Management

− Continue growth in retail funds business

− Looking to extend reach further into wholesale funds sector

− Capital management and development execution within ADF remains key focus

− Strong AUM growth expected in Aspen Parks

− Asset sales within Aspen Diversified Fund

Strategic Messages

Aspen Group – 1H2012 Results6

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Financial Summary

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FINANCIAL SUMMARY


1H2012 $m

1H2011 $m

Underlying Net Profit Before Tax 16.6 15.6

Changes in fair value of assets 12.6 (11.2)

Changes to group structure 0.6 -

Impact of ADF put option (17.8) -

Financial instruments marked to market (3.2) 1.2

Other (2.0) (0.4)

Statutory Net Profit Before Tax 6.8 5.2

1H2012 Financial Results Summary

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FINANCIAL SUMMARY

Income Statement (underlying earnings )


1H2012$m

1H2011$m

Income from operations Rental income 21.6 27.1

Funds management 13.2 10.7

Other income 3.8 1.4

Total Income 38.6 39.1

Expenses Direct property expenses (7.1) (8.7)

Employment (5.5) (5.7)

Administrative and other expenses (3.4) (2.5)

Total Expenses (16.0) (16.9)

Share of profit of associates (0.1) 0.7

Financial expenses (5.9) (7.3)

Profit Before Tax 16.6 15.6

Income tax benefit 2.0 0.8

Profit after Tax from Operating Earnings 18.6 16.4

Operating EPS 3.16 cents 2.93 cents

Distributions 2.10 cents 2.10 cents

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FINANCIAL SUMMARY

Funds Management Performance


Diversified Property Fund ($m)

1H2012 1H2011

Revenue 1.00 2.15

Operating EBITDA 0.60 1.78

Aspen Parks Property Fund ($m)

1H2012 1H2011

Revenue 4.33 3.57


Aspen Living ($m) 1H2012 1H2011

Revenue 5.05 4.25


Aspen Development Fund ($m)

1H2012 1H2011

Revenue 2.71 1.42


► Aspen Diversified – lower contribution resulting from consolidation at 31 October 2011

► Aspen Parks continued strong operational performance contributing higher performance fee and equity profits

► Aspen Living revenue in line with 1H2011 driven by increased interest income. Higher volume of lot settlements expected in second half to drive improved fee contribution

► ADF No. 1 – positively impacted by management fees on ATO Building construction

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FINANCIAL SUMMARY

31 Dec 2011$m

30 June 2011$m

Total assets 716.1 597.8

Total Liabilities 306.9 207.4

Net Assets 409.2 390.4

NTA 1 $0.68 $0.67

Gearing 35% 28%

Look-through Gearing 35% 34%

Interest Cover Ratio 3.8x 3.4x

Summary Balance Sheet and Cash Flow

Note 1. excludes non dilutive employee share options

11 Aspen Group – 1H2012 Results

31 Dec 2011$m

31 Dec 2010$m

Cashflow from operations 13.1 10.3

Cashflow from investing activities (13.3) (2.7)

Cashflow from financing (4.2) (4.9)

Net Cash movement (4.4) 2.7

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Capital Management Initiatives


► Secured 50% equity participation for development of ATO building ($34m).

► Secured debt funding for development of ATO building ($117.6m)

► Sale of Alcoa building for $28.3m with settlement to occur in late FY12

► Initiated sales program of non-core assets

► Extending debt facilities within Funds

FINANCIAL SUMMARY

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Property Portfolio

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PROPERTY PORTFOLIO

Excluding impact of Heaton Street, Rocklea vacancy, 4.8% like for like growth in balance of portfolio (or 1.7% including)

Independent valuations up $16.7m (7.6%) on June 2011

Sale of Alcoa Building for $28.25m. Settlement due on 1 May 2012 with $3m deferred

High quality tenancy profile of government and major corporate tenants

Investment Property Overview


Direct Property ($m) 1H2012 1H2011

Revenue 24.16 29.07


Key Metrics Dec 2011 June 2011

Portfolio Total ($m) 323 327

Weighted Ave Cap Rate (%)

9.28% 9.47%

Occupancy (%) 93% 93%

WALE (years) 1.95 2.30

WALE - post ATO completion (years)

4.80 5.00

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PROPERTY PORTFOLIO

ATO Building, Adelaide SA – under construction

Septimus Roe – Book Value (BV) $96 million

− Occupancy now at 92%

− Net market rents now $525 sqm vs passing of $440 sqm

Aspen Karratha Village – BV $52 million

− Going through market review 2nd quarter 2012, with uplift expected

ATO Building (50% with Telstra Super) – BV $91.851

− 71% complete (66% at Dec 2011) and on target for scheduled completion on 31 October 2012

− Starting NOI of $7.16m from November 2012

− 99% leased with WALE of 14.4 years

− Potential for valuation uplift on Practical Completion

Key Property Update

15 1 On completion value

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PROPERTY PORTFOLIO


Entire complex sub-leased to AWH expiring June 2012

Leasing campaign started for expected June expiry -strong demand shown

Strong rental upside on cessation of lease

Warehouse GLA 99k sqm

Hardstand GLA 100k sqm

Shortage of industrial land and warehousing in WA

Strong demand from resource sector

Key Property Update – Spearwood Industrial Estate – BV $58m

Spearwood Industrial Estate, Spearwood WA

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PROPERTY PORTFOLIO

Key Property Update – Spearwood Industrial Estate

Existing Lease Metrics Achievable Market Rates

Rent Annual Rent Rent Annual Rentsqm $ / sqm $m $ / sqm $m

Warehouse A 39,484 47.53 1.88 60 2.37 Lease Area 1 21,697 - 15 0.32Warehouse B 59,320 47.53 2.82 55 3.26 Lease Area 2 22,597 - 20 0.45Lease Area 4 47,712 - 20 0.95 Warehouse c + Off 3,534 - 80 0.28 Lease Area 3 5,349 - 20 0.11

199,693 4.70 7.7417

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PROPERTY PORTFOLIO

Portfolio to benefit from overweight position in buoyant WA market

Perth office vacancy fell to 3.3% from 7.8% in 6 months to January 2012 1

Active asset management strategy:

− Capitalise on strong office demand for Septimus Roe leasing.

− Strong rental upside opportunity with high resource and logistics interest in leasing Spearwood Industrial Estate from 1 July 2012

− Reduced capital expenditure requirements in FY12 and FY13 due to targeted asset disposals

Active portfolio management strategy to continue

Investment Property Outlook

Sector Diversification (post ATO Building completion) 2

Note 1 Source: Property Council of Australia Office Market Report Dec 2011Note 2 Direct Portfolio excludes Ballina NSW community assets Aspen Group – 1H2012 Results

61%

26%

13%Commercial

Industrial

Other

Geographical Diversification (post ATO Building completion) 2

WA, 62%

VIC, 7%

QLD, 2%

SA, 29%

WA

VIC

QLD

SA

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Funds Management

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BT Wrap39.6%

Asgard17.5%

Netwealth20.7%

Macquarie11.7%

Colonial First State

4.2%

AMP3.9%

Other2.4%

FUNDS MANAGEMENT

Key Highlights► Strong equity retail inflows with Aspen Parks

inflows up 44%

► Further expansion of financial advisor networks

► Continued diversified support from advisers through major platforms

Outlook► Expectation of further interest rate cuts to

favour unlisted property sector

► Strong growth from existing funds, particularly Aspen Parks and Living

► Progress new fund offerings

► Pursue partnership opportunities with institutional / wholesale investors

Aspen Parks equity inflows FY07 to 1H2012 and Forecast FY12

0

5

10

15

20

25

30

35

40

45

FY07 FY08 FY09 FY10 FY11 FY12

$M Forecast Actual


Aspen Parks Wholesale Fund – Platform Supporters

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FUNDS MANAGEMENT

► Portfolio valuation increased $5.6m (4.8%) on June 2011

► Total income for 1H2012 in line with forecast

► Castle Hill – added Seconds World tenancy to increase centre occupancy to 97%

Aspen Diversified Property Fund – 1H2012 Overview

Outlook► Unitholders meeting by June 2012 to

consider strategy for winding up Fund or extension of term

► Continued active asset management strategy to lease and trade assets where conditions permit


Key Metrics Dec 2011 June 2011

Weighted Ave Cap Rate (%)

9.18% 9.27%

Occupancy (%) 96% 91%

WALE (years) 5.47 4.80

72-96 Station St, Nunawading, VIC

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FUNDS MANAGEMENT

Strong 1H2012 trading performance driven by growth in revenue from mining properties

Tourist Parks revenues remained steady

Positive ongoing operating cash flows allowed for further debt reduction

Gearing reduced from 44.4% (June 2011) to 39.7%

Distribution rate of 10.7c for FY12 maintained

Aspen Parks Property Fund – 1H2012 Overview

OutlookStrategic focus on acquisition and development opportunities in short to medium term

Progress planning and development opportunities within portfolio


-

2

4

6

8

10

12

14

16

18

Mining Resorts Tourism

$M

Aspen Parks income segment analysis

1H2011 1H2012

-

2

4

6

8

10

12

14

Mining Resorts Tourism

$M

Aspen Parks profit segment analysis

1H2011 1H2012

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FUNDS MANAGEMENT

1H2012 1H2011

Lot settlements (Number) 55 161

Lot settlements (Gross Realisable Value) $13.9m $36.0m

Achieved 55 lot settlements for GRV of $13.9m

New lots sale contracts secured for FY12 (104 lots at $25.4m)

Settlements down on budget (83 lots) due to inventory lag and clearance delays

Residential market in 1st half of FY12 performed as expected with improved enquiry and sales levels post RBA interest rate reductions.

St Leonards continue to lead sales with 98 sales representing GRV of $27.7m

ADLL & STLE successfully refinanced for additional two years

80% of syndicates with debt facilities until 2013

Aspen Living - 1H2012 Overview


0

50

100

150

200

250

300

FY09 FY10 FY11 FY12

Aspen Living - Lots settled FY09 to FY12 forecast

Actual Forecast

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FUNDS MANAGEMENT

Market conditions remain challenging for remainder FY12, however mitigated through:─ Stock priced competitively with other estates and established market

─ Continue to maximise sales through strong builder relationships

─ Smaller lot product released for Enclave, St Leonards and Fern Bay

─ Conservative sales forecasts in regional assets, particularly Whitsunday Shores

Total forecast settlements of 272 lots in FY12 for GRV $71.9m

69% presales and settlements to date underpin FY12 result (GRV $50.6m)

Syndication of 300 small lot subdivision in Byford to commence 2nd half FY12

Remaining FY12 Settlements

2H2012 Contracts on hand

2H2012 New sales to be achieved

Contracts on hand for FY13

Dunsborough 19 6 13 7

Fern Bay 99 47 52 -

St Leonards 84 77 7 21

Whitsunday Shores 15 4 11 -

Enclave at St Leonards - - - 54

TOTAL 217 134 83 82

Aspen Living - Outlook


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FUNDS MANAGEMENT

ATO Building works on budget. Now 71% complete

Mariner Apartments in Geraldton occupancy 90%

1H2012 Medical Suites sales – settled 3 suites for $1.6m

19 settlements at Byford for $3.8m

Progression of Byford dust buffer planning which enables 70 lots unlocked

ADF No. 1 – 1H2012 Overview

OutlookCapital management challenges impacting returns

ATO Building 92% complete at 30 June 2012

Progress residential, office and entertainment precinct planning in Adelaide

Secure planning approvals on Upper Swan transport depot

Potential 1,600 sqm expansion of Norwest Hospital


Electra House redevelopment site, Adelaide

Byford on the Scarp, WA

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Outlook and Guidance

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OUTLOOK & GUIDANCE

OutlookContinuing stable rental income with potential for asset growth

Funds Management growth through:

─ Aspen Living – Improved 2H2012 with 69% of full year forecast settlements presold

─ ADF No. 1– ATO Building on schedule and forecast to be 92% complete as at 30 June 2012

─ Aspen Parks – Continued earnings performance with significant upside opportunities through acquisitions or identified development projects within existing portfolio.

Focus on execution of non-core asset disposals and loan recoupment

Guidance

On track to meet FY12 operating profit before tax to $35.75m, representing a post tax 6.43 cents per security


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Appendices

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Contents

1. Corporate Structure2. Organisation Structure3. Balance Sheet4. Cashflow Summary5. Summary of Investment Properties6. Funds Management - Assets Under Management7. Aspen Living Pipeline8. Additional Fund Metrics

APPENDICES


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Property Portfolio$394 AUM

Funds Management$1.0B AUM

APPENDIX 1

Corporate Structure

Aspen Group (APZ) Stapled Securities

Rental income Funds management fees, equity profits, interest revenue

Fund Sector StructureEquity /% Owned Loans AUM

Aspen Parks Tourist & Accom Parks

Unlisted Retail Fund

$18.8m14% Nil $290m

Aspen Living Residential

5 UnlistedCompanies(Wholesale /Retail Investors)

$8.7mW. Ave

31%$80.3m $298m

Aspen DevelopmentFund No. 1

Commercial & Residential Developments

Unlisted Company(Wholesale Investors)

$22.8m47% $16.3m $239m

AspenDiversified 1

Core Income Unlisted Retail Fund

$15.9m53% $14.6m $122m

Asset AUM

Investment Portfolio $323m

Non core property $25m

Assets held for sale $46m

Aspen Group – 1H2012 ResultsNote 1. Aspen Diversified has been consolidated effective 31 October 2011, however shown within Funds Management business for illustrative purposes30

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APPENDIX 2

Gavin Hawkins

Managing Director

Brett FullartonCFO

Eric LeeCompany Secretary

Philip BarkerHead of Funds Management

Lino BroleseCEO

Aspen Parks

Chris Lewis Head of

Residential

Jeff HollowayHead Of

Commercial Development

Jamie Smith Head of

Commercial Property

Organisational Structure

Shared Services


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APPENDIX 3

31 Dec 11$m

30 June 11$m

Current Assets Cash and other 74.3 43.9

Subsidiary assets held for sale 122.1 -

Non-Current Investment Properties 323.4 327.4

Equity Investments 37.1 81.0

Inventories 24.9 23.5

Loans to associates 82.3 81.2

Other 52.0 40.8

Total Assets 716.1 597.8

Current Liabilities Borrowings 18.5 20.6

Subsidiary liabilities held for sale 76.8 -

Other 44.6 32.0

Non-Current Borrowings 167.0 154.8

Total Liabilities 306.9 207.4

Net Assets 409.2 390.4

NTA 1 $0.68 $0.67

Note 1 excludes non dilutive employee share options

Balance Sheet


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APPENDIX 4

1H2012$m

1H2011$m

Mvt$m

Note

Cashflow from operating activities 13.1 10.2 2.9 1

Key cashflows from investing activities

Acquisition of property, plant and equipment (0.4) - (0.4)

Development / improvement of investment properties (26.9) (5.7) (21.2) 2

Net movement in funds management equity investments (0.3) - (0.3)

Acquisition of subsidiary, net of cash acquired (5.5) - (5.5)

Proceeds from sale of investments 17.7 - 17.7 3

Proceeds from sale of investment properties - 3.1 (3.1)

Proceeds from sale of inventories 2.1 - 2.1 Key cashflows from financing activities

Net movement in loans to Funds (7.0) (16.2) 9.24

Net movement in borrowings 10.1 15.3 (5.2)Distributions (7.2) (7.5) 0.3Other movements (0.1) 3.5 (3.6)Net movements in cash (4.4) 2.7 (7.1)

1. Increase in operating cashflow $2.9m / 28%2. Includes development of ATO Building3. Sale of 50% Franklin Street Property Trust 4. Includes repayment of loans from Aspen Diversified Fund and Franklin Street Property Trust

Cash flow Summary


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APPENDIX 5

PropertyLatest

Independent Valuation

Date

Book Value($m)

1H2012 Change in Valuation

($m)

Cap Rate(%)

WALE(yrs)

Occupancy(%)

Septimus Roe, WA Oct 11 96.0 9.0 8.75 2.57 92

Spearwood Industrial Estate, WA June 11 58.0 - 9.75 0.42 100

Karratha Village, WA Oct 11 52.0 8.0 19.00 2.00 100

Noble Park, VIC Dec 11 22.1 1.1 10.00 2.62 100

51 Heaton Street, Rocklea, NSW Dec 11 8.1 (1.4) 10.25 - Nil

ATO Building, SA 1 n/a 54.1 - n/a n/a n/a

Sovereign Gardens, Ballina, NSW 2 n/a 33.0 - n/a n/a n/a

Total / Averages 323.4 16.7 9.28 # 1.95 ## 93

# Weighted Ave Cap Rate (ex Karratha) ## WALE upon completion of ATO building in October 2012 is 4.8 years1 ATO Building currently under construction. Balance represents Aspen 50% interest in the book value of work completed.2 Relates to community village asset

Summary of Investment Properties


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APPENDIX 6

Aspen LivingResidential

5 Assets (AUM $298M)

Aspen ParksTourism &

Accommodation25 Assets (AUM $290M)

ADF No.1Developments14 Assets (AUM

$239M)

Aspen DiversifiedCore Income

9 Assets (AUM $122M)

Funds Management - Assets Under Management


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APPENDIX 7

Jan 2006

Jan 2007

14

10

5

12

1

2006 2008 2010 2012 2014 2016 2018 2020 2022 2024 2026

Dunsborough Lakes

Seaside Fernbay

St Leonards Estate

Whitsunday Shores Estate

Enclave at St Leonards

Feb2026

Oct2016

Apr 2022

Oct2020

960 lots GRV $286mil

881 lots GRV $262mil

1,376 lotsGRV

$398mil

Jun2013

181 lotsGRV

$40.7 mil

`

855 lotsGRV

$275mil

Aspen Living - Pipeline


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APPENDIX 8

Aspen Fund Lender Maturity Total Assets Debt Facility

Aspen Dunsborough Lakes 1 Nab FY14 $79m $31m

Aspen Whitsunday Shores 1 Nab FY13 $46m $6m

Fern Bay Seaside Village 1 Bankwest FY12 $81m $28m

St Leonard's Estate 1 Nab FY14 $78m $30m

Enclave at St Leonard's Estate 1 Police & Nurses FY13 $15m $7m

ADF No 1. Ltd Nab/ Bankwest FY13 $239m $85m

Aspen Parks St George FY15 $290m $140m

Aspen Diversified Nab FY15 $122m $75m

1. Fall into Aspen Living portfolio

Additional Fund Metrics


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DISCLAIMER

This presentation has been prepared by Aspen Group (“Aspen”) and should not be considered inany way to be an offer, invitation, solicitation or recommendation with respect to thesubscription for, purchase or sale of any security, and neither this document nor anything in itshall form the basis of any contract or commitment. Prospective investors should make theirown independent evaluation of an investment in Aspen. Nothing in this presentation constitutesinvestment, legal, tax or other advice. The information in this presentation does not take intoaccount your investment objectives, financial situation or particular needs. The informationdoes not purport to constitute all of the information that a potential investor may require inmaking an investment decision.

Aspen has prepared this presentation based on information available to it. No representationor warranty, express or implied, is made as to the fairness, accuracy, completeness orcorrectness of the information, opinions and conclusions contained in this presentation. To themaximum extent permitted by law, none of Aspen , its directors, employees or agents, nor anyother person accepts any liability, including, without limitation, any liability arising from faultor negligence on the part of any of them or any other person, for any loss arising from the useof this presentation or its contents or otherwise arising in connection with it.

All references to dollar amounts are in Australian currency unless otherwise stated.For

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For personal use only Presentation · 2012-02-23 · 5.4%. 10.8%: Funds Management Total. 949: 9.18. 7.71: 152.54. 12.0%: 9.0%. 1H2012 Contribution by Segment. Aspen Group – 1H2012

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