ASPEN GROUP — Earnings Release 2024

Aug 14, 2024

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Aspen Group Limited ABN 50 004 160 927

Suite 21, 285A Crown Street Surry Hills NSW 2010

Telephone: 02 9151 7500 Email: homemail@aspengroup.com.au

ASX ANNOUNCEMENT 15 August 2024

Aspen Group FY24 Results

Continued Strong Growth Across the Platform

Aspen Group (ASX: APZ) is pleased to announce strong FY24 results and an upgrade to underlying earnings and distribution guidance for FY25.

The quality and scale of Aspen continues to improve through disciplined acquisitions & disposals and costeffective refurbishment & development. Net asset value, earnings and distributions increased materially and we maintained competitive rents and sales prices for our customers which reduces risk and increases growth prospects. Risks were mitigated further by maintaining a measured exposure to development, tight controls on inventories and a strong balance sheet.

Highlights

• § Aspen’s average rents have increased significantly yet remain highly competitive and attractive to customers:

• ü Total portfolio rent[1] increased 15% to $317pw per dwelling/site

• ü Residential rent increased 20% to $348pw per dwelling – current market rent[2 ] is 12% higher

• ü Lifestyle rent increased 16% per land site – current average land rent (excluding ancillary services) of $187pw is 21% below the rent at which CRA caps out[3]

• § Property NOI margin increased 2ppt to 50% mainly through improved operational management and structural improvements in our portfolio

• § Record production, sales and average prices for new development:

• ü Lifestyle development profit doubled with sales volume increasing 64% and average sales price increasing 14% to $418k – still well below local median house prices and some competing villages

• ü Developed stages of Residential land essentially sold out with average sales price increasing 13% to $200k - allows new homes to be developed cheaper than local existing house prices

• ü Development Profit margin on target at 30% and ROIC[4] was 21%

• ü Significant growth outlook with low-cost pipeline of 1,152 approved sites already on balance sheet equating to 12x FY24 sales

• ü Risks mitigated – entire development assets represent only c.7% of total assets, spread across 9 active projects diversified by geography, regulation, customers, and builders

• § Continued recycling of capital from Residential properties with relatively high rents at c.3% yield into properties with lower rents more suited to Aspen’s customer base with higher expected returns

• § Strong balance sheet maintained – gearing[5] of 26% and interest cover ratio[6] of 3.7x

FY24 Financial Summary

Total Comprehensive Income before tax[7] $69.9m - up 12% on pcp

38.2 cents per security

19% ROE[8]

Statutory Net Profit $48.4m

(excludes $5.6m increase in value of Darwin FSR (classified as PP&E) and includes $15.8m deferred tax expense)

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Net Asset Value (excluding DTL[9] )

Up 11% (22.2 cents) to $2.23 per security

Underlying Operating Earnings[11]

Up 15% to 13.81 cents per security

from 30 June 2023

Earnings Creation

Value Creation

Increases in Property NOI comfortably offset assumed WACR[10] increase of 30bps to 6.8%

Average value per dwelling/site only $108k

Strong balance sheet – 26% gearing and 3.7x ICR

Net Rental Income up 27% to $30.8m Development Profit up 39% to $8.7m EBITDA up 31% to $32.2m

Net finance expense up 88% to $6.9m Underlying Operating Earnings up 21% to $25.3m (% are compared to FY23)

Cash Creation

Net operating cashflow[12] $22.1m

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Distributions

8.50 cents per security

(89% tax deferred / 62% payout ratio)

Positive Outlook and Upgrade to FY25 Earnings[11] and Distribution Guidance

We expect continued strong performance and are pleased to announce an upgrade to FY25 guidance:

• § Underlying Operating EBITDA of $40m – up 24% on FY24

• § Underlying EPS of 15.2 cents – up 10% on FY24

• § DPS of 10.0 cents – up 18% on FY24

Please refer to Aspen’s FY24 Financial Report and Results Presentation released on ASX today for further information including assumptions underlying the FY25 guidance.

Announcement authorised by the Board of Aspen Group Limited.

END

For further information, please contact: John Carter David Dixon Joint Chief Executive Officer Joint Chief Executive Officer Phone: (+61) 2 9151 7586 Phone: (+61) 2 9151 7584 Email: johnc@aspengroup.com.au Email: davidd@aspengroup.com.au

1. Rent includes a small amount of ancillary revenues at some of our properties

2. Market rent is an estimate based on rents currently being achieved on new leases and lease renewals at Aspen’s properties

3. CRA – Commonwealth Rent Assistance - the cap is the rent at which the maximum amount of CRA subsidy is paid to an eligible couple on the age pension

4. ROIC - Return on Invested Capital equals development profit divided by the carrying value of development inventory plus spare land in lifestyle properties classified as investment property

5. Gearing = financial debt less cash / total assets less cash less retirement village resident loans and deferred revenue

6. ICR – Interest Cover Ratio as defined in Aspen’s debt covenant

7. Pre expense provision of $15.8m (8.6cps) for tax that would be payable by Aspen Group Limited if it sold all its assets at 30 June 2024 book value

8. ROE – Return on Equity = Comprehensive Income before tax per security divided by starting Net Asset Value per security 9. DTL – Deferred Tax Liability provision of $10.6m (5.3cps) for tax that would be payable by Aspen Group Limited if it sold all its assets at 30 June 2024 book value (Trust entity accounts do not provide for tax liabilities)

9. WACR – Weighted Average Capitalisation Rate

10. Underlying Operating Earnings is a non-IFRS measure that is determined to present, in the opinion of the directors, the operating activities of Aspen in a way that appropriately reflects Aspen’s underlying operating performance – refer to financial report for full definition

11. Operating cashflow includes dividends received, and interest and tax paid

Disclaimer

This announcement has been prepared by Aspen Group Limited on behalf of Aspen Group Limited and Aspen Property Trust (“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 anything in it shall form the basis of any contract or commitment. Prospective investors should make their own independent evaluation of an investment in Aspen. Nothing in this announcement constitutes investment, legal, tax or other advice. The information in this announcement does not take into account your investment objectives, financial situation or particular needs. The information does not purport to constitute all of the information that a potential investor may require in making an investment decision.

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

This announcement contains forward looking information. Indications of, and guidance on, future earnings, distributions and financial position and performance are forward looking statements. Forward looking statements are based on Aspen’s current intentions, plans, expectations, assumptions, and beliefs about future events and are subject to risks, uncertainties and other factors which could cause actual results to differ materially. Aspen and its related bodies corporate and their respective directors, officers, employees, agents, and advisers do not give any assurance or guarantee that the occurrence of any forward-looking information, view or intention referred to in this announcement will actually occur as contemplated. All references to dollar amounts are in Australian currency.

This announcement has been prepared for publication in Australia and may not be released to the US wire services or distributed in the United States. This announcement does not constitute an offer of securities for sale in the United States or any other jurisdiction. Any securities described in this address may not be offered or sold in the United States absent registration under the US Securities Act of 1933 or an exemption from registration.

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Koala Shores Holiday Park, NSW