EXHIBIT 99.1

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FOR IMMEDIATE RELEASE:  December 10, 2019



Aspen Group Reports Record Revenue of $12.1 Million in the Second Quarter Fiscal Year 2020, Accelerating to 49% Growth Year-over-Year


Net Loss Improves to ($0.6) Million as All Three Business Units Deliver Profitability on a Net Income Basis


Company EBITDA Positive (a non-GAAP financial measure), Delivering $0.5 Million or 4% margin



NEW YORK, NY –December 10, 2019 - Aspen Group, Inc. (Nasdaq: ASPU)( “the Company or AGI”), an education technology holding company, today announced financial results for its 2020 fiscal second quarter ended October 31, 2019.


Second Quarter and Year-to-Date Fiscal Year 2020 Summary


  

Three months ended

Six months ended

($ in millions)

October 31, 2019

October 31, 2018

% Change B/(W)

October 31, 2019

October 31, 2018

% Change

B/(W)

Revenue

$12.1

$8.1

49%

$22.4

$15.3

47%

GAAP Gross profit

$7.6

$4.1

87%

$13.4

$7.4

81%

      GAAP Gross margin (%)

63%

50%

1,300 bps

60%

48%

1,200 bps

Operating Income (Loss)

($0.3)

($2.5)

87%

($2.0)

($5.3)

63%

Net Income (Loss)

($0.6)

($2.5)

 74%

($2.7)

($5.3)

49%

Cash Used in Operations

($0.3)

($2.1)

84%

($2.0)

($5.5)

63%

EBITDA (Loss)*

$0.5

($1.9)

>100%

$(0.5)

($4.2)

88%

Adjusted EBITDA (Loss)*

$1.4

($1.3)

>100%

$1.3

($3.1)

>100%


Second Quarter Performance Highlights

·

Revenue accelerated to 49% growth, while marketing expenses declined by 11% year-over-year, driving a gross margin improvement of 1,300 basis points or 63%

·

Focused marketing expenditure resulted in record enrollment growth in highest lifetime value (LTV) degree programs

·

Bookings rose 92% to $31.3 million lifting average revenue per enrollment (ARPU) by 35% to $14,125

·

Aspen University Online and Pre-Licensure BSN units, as well as United States University, all delivered net income due to improved operating efficiencies and lower enrollment costs

·

Cash used in operations declined $1.8 million or 84% year-over-year to $0.3 million


Michael Mathews, Chairman and CEO of AGI, commented, Our strong momentum in Fiscal 2020 accelerated during the second quarter with revenue increasing 49% year-over-year, while operating expense increased only 22% year-over-year due to diligent expense management and improved operating leverage. This resulted in a significant reduction in our net loss and generated positive EBITDA in the quarter. By targeting our marketing spend on degree programs with the highest lifetime value (LTV), we had record bookings in the quarter increasing by 92%, as well as record average revenue per enrollment or ARPU increasing by 35%. This is the first quarter since acquiring United States University in December 2017 and launching our Pre-Licensure BSN nursing program in July 2018 that all three business units, Aspen University Online and Pre-Licensure BSN, as well as United States University, produced net income in the quarter. We remain committed to our goals of sustainable long-term growth, improving profitability of our universities and improvement in cash flow from operations. Given the strong performance in the first half of fiscal year 2020, we now expect annual revenue growth to meet or exceed 41% for the full fiscal year. Our improving financial performance will continue to support our Pre-Licensure BSN expansion strategy, an important long-term growth and profitability catalyst for the Company.”


*See “Non-GAAP Financial Measures” at page 3.



1



 


Fiscal 2020 Second Quarter Financial and Operational Results (versus Fiscal 2019 Second Quarter):

·

New student enrollments increased 42% to quarterly record of 2,217

o

Aspen University (AU) new student enrollments increased 41% to 1,823

o

United States University (USU) new student enrollments increased 45% to 394

·

Weighted average cost of enrollment declined 25% driven by reduced lead costs and higher conversion rates

·

Bookings increased 92% to $31.3 million due to strong growth in highest LTV degree programs

·

Average revenue per enrollment (ARPU) increased 35% over the prior year to $14,125

·

Total student enrollment grew 35% over the prior year to 10,718

·

Total nursing student body increased to 8,904 from 6,206 students, or 83% versus 78% of total student enrollment


AGI delivered 2,217 new student enrollments for the second fiscal quarter ended October 31, 2019 (Q2 2020), a 42% increase year-over-year. Aspen University accounted for 1,823 new student enrollments (including 190 Doctoral enrollments and 437 Pre-licensure BSN AZ campus enrollments). United States University (“USU”) accounted for 394 new student enrollments (primarily MSN-Family Nurse Practitioner (“FNP”) enrollments). Enrollment growth at Aspen University was highlighted by the Doctoral unit, which increased by 43% year-over-year, and the Pre-Licensure BSN unit, which increased 58% on a sequential basis. The sequential acceleration of growth in the Pre-Licensure BSN unit is a result of a full quarter of enrollments across both campuses that are now open in Phoenix, AZ.


Below is a comparison of enrollments and bookings** from Q2 2020 to the quarter ended October 31, 2018 (Q2 2019).  The Company’s total enrollments rose 42% year-over-year, while bookings increased 92% year-over-year to $31.3 million from $16.3 million. This translates to a 35% increase in average revenue per user (ARPU)** year-over-year, from $10,434 to $14,125, driven by the Company’s focused marketing spending on the highest LTV degree programs during the quarter.


 

 

Lifetime Value (LTV)

 

 

Q2'2019

 

 

Q2'2019

 

 

Q2'2020

 

 

Q2'2020

 

 

% Change

 

 

 

Per Enrollment

 

 

Bookings**

 

 

Enrollments

 

 

Bookings**

 

 

Enrollments

 

 

Bookings

 

AU Online (Nursing + Other) Unit

 

$

7,350

 

 

$

8,114,400

 

 

 

1,104

 

 

$

8,790,600

 

 

 

1,196

 

 

 

8

%

AU (Doctoral) Unit

 

$

12,600

 

 

$

1,675,800

 

 

 

133

 

 

$

2,394,000

 

 

 

190

 

 

 

43

%

AU (Pre-Licensure BSN) Unit

 

$

30,000

 

 

$

1,710,000

 

 

 

57

 

 

$

13,110,000

 

 

 

437

 

 

 

666

%

USU (FNP + Other) Unit

 

$

17,820

 

 

$

4,829,220

 

 

 

271

 

 

$

7,021,080

 

 

 

394

 

 

 

45

%

Total

 

 

 

 

 

$

16,329,420

 

 

 

1,565

 

 

$

31,315,680

 

 

 

2,217

 

 

 

 

 

ARPU

 

 

 

 

 

$

10,434

 

 

 

 

 

 

$

14,125

 

 

 

 

 

 

 

 

 


**“Bookings” are defined by multiplying LTV by new student enrollments for each operating unit. “Average Revenue Per

User or (ARPU)” is defined by dividing total bookings by total enrollments.


AGI’s overall active student body (including both Aspen University and USU) grew 35% year-over-year from 7,950 to 10,718 students as of October 31, 2019, and students seeking nursing degrees were 8,904 or 83% of total students at both universities.

Aspen University’s total active degree-seeking student body grew 27% year-over-year from 7,107 to 9,016. Aspen’s School of Nursing grew 34% year-over-year, from 5,466 to 7,299 active students, which includes 1,051 active students in the BSN Pre-Licensure program in Phoenix, AZ. Specifically, Aspen’s BSN Pre-Licensure program active student body grew sequentially by 57%, from 670 to 1,051 students, as a result of now having two campuses open in Phoenix, AZ. Aspen University students paying tuition and fees through a monthly payment method grew by 17% year-over-year, from 5,074 to 5,927. Those 5,927 students paying through a monthly payment method represent 66% of Aspen University’s total active student body.

USU’s total active student body grew year-over-year from 843 to 1,702, or 102%, and up sequentially by 14%. USU’s MSN-FNP active student body grew sequentially from 1,294 to 1,463 for an increase of 13%. USU’s MSN-FNP program now represents 86% of USU’s active student body. USU students paying tuition and fees through a monthly payment method grew to 1,101 students representing 65% of USU’s total active student body in Q2 2020.

Revenues increased 49% to $12,085,965 for the fiscal quarter ended October 31, 2019 as compared to $8,095,344 in Q2 2019. USU accounted for approximately 27% and Aspen University’s Pre-Licensure BSN program accounted for approximately 12% of overall Company revenues.


Gross profit increased to $7,638,195 or 63% gross margin for Q2 2020 versus $4,083,951 or 50% gross margin in Q2 2019. Aspen University gross profit represented 65% of Aspen University revenues for Q2 2020, while USU gross profit equaled 67% of USU revenues for Q2 2020. Aspen University instructional costs and services represented 16% of Aspen University revenues for Q2 2020, while USU instructional costs and services equaled 23% of USU revenues for Q2 2020. Aspen University marketing and promotional costs represented 16% of Aspen University revenues for Q2 2020, while USU marketing and promotional costs equaled 11% of USU revenues for Q2 2020.




2



 


Net loss applicable to shareholders was ($638,168) or diluted net loss per share of ($0.03). Aspen University generated $1.8 million of net income for Q2 2020, and USU generated $151,359 of net income in Q2 2020. AGI corporate incurred $2.6 million of expenses for Q2 2020.


EBITDA, a non-GAAP financial measure, was $460,919 or 4% as compared to an EBITDA loss of ($1,899,814) or (23%) in Q2 2019. Adjusted EBITDA, a non-GAAP financial measure, was $1,360,808 or 11% as compared to an Adjusted EBITDA loss of ($1,304,543) or (16%) in Q2 2019.


Aspen University generated EBITDA of $2.1 million or 24% margin and Adjusted EBITDA of $2.6 million or 26% margin for Q2 2020. Note that Aspen’s pre-licensure BSN program accounted for $537,983 of the $2.1 million EBITDA generated at Aspen University, operating at an EBITDA margin of 35% -- becoming the highest margin unit of the Company. USU generated EBITDA of $455,391 or 14% margin and $519,818 of Adjusted EBITDA or 16% margin Q2 2020. AGI corporate contributed $1.7 million of expenses toward the $1,360,808 Adjusted EBITDA result for Q2 2020.


The Company used cash of $0.3 million in operations in Q2 2020, as compared to using $2.1 million in Q2 2019, an improvement of 84% year-over-year.


Conference Call:


Aspen Group, Inc. will host a conference call to discuss its fiscal year 2020 second quarter financial results and business outlook on Tuesday, December 10th, 2019, at 4:30 p.m. (ET).   Aspen will issue a press release reporting results after the market closes on that day. The conference call can be accessed by dialing toll-free (844) 452-6823 (U.S.) or (731) 256-5216 (international), passcode 3788764. Subsequent to the call, a transcript of the audiocast will be available from the Company’s website at ir.aspen.edu. There will also be a seven day dial-in replay which can be accessed by dialing toll-free (855) 859-2056 or (404) 537-3406 (international), passcode 3788764.


Non-GAAP – Financial Measures:


This press release includes both financial measures in accordance with the Generally Accepted Accounting Principles, or GAAP, as well as non-GAAP financial measures. Generally, a non-GAAP financial measure is a numerical measure of a company’s performance, financial position or cash flows that either excludes or includes amounts that are not normally included or excluded in the most directly comparable measure calculated and presented in accordance with GAAP. Non-GAAP financial measures should be viewed as supplemental to, and should not be considered as alternatives to net income (loss), operating income (loss), and cash flow from operating activities, liquidity or any other financial measures. They may not be indicative of the historical operating results of AGI nor are they intended to be predictive of potential future results. Investors should not consider non-GAAP financial measures in isolation or as substitutes for performance measures calculated in accordance with GAAP.


Our management uses and relies on Adjusted EBITDA and EBITDA, each of which are non-GAAP financial measures. We believe that both management and shareholders benefit from referring to these non-GAAP financial measures in planning, forecasting and analyzing future periods. Our management uses these non-GAAP financial measures in evaluating its financial and operational decision making and as a means to evaluate period-to-period comparisons.  Our management recognizes that the non-GAAP financial measures have inherent limitations because of the excluded items described below.


AGI defines Adjusted EBITDA as earnings (or loss) from continuing operations before the items in the table below. It is important to note that there were zero non-recurring charges for the fiscal quarter ended October 31, 2019 compared to $118,872 in the fiscal quarter ended October 31, 2018. Adjusted EBITDA is an important measure of our operating performance because it allows management, investors and analysts to evaluate and assess our core operating results from period-to-period after removing the impact of items of a non-operational nature that affect comparability.


We have included a reconciliation of our non-GAAP financial measures to the most comparable financial measures calculated in accordance with GAAP. We believe that providing the non-GAAP financial measures, together with the reconciliation to GAAP, helps investors make comparisons between AGI and other companies. In making any comparisons to other companies, investors need to be aware that companies use different non-GAAP measures to evaluate their financial performance. Investors should pay close attention to the specific definition being used and to the reconciliation between such measure and the corresponding GAAP measure provided by each company under applicable SEC rules.




3



 


The following table presents a reconciliation of net loss allocable to common shareholders to Adjusted EBITDA:



 

 

 

 

 

Quarter Ended

October 31,

 

 

 

 

 

 

2019

 

 

2018

 

Net loss

 

 

 

 

 

$

(638,168

)

 

$

(2,475,078

)

Interest expense, net of interest income

 

 

 

 

 

 

426,694

 

 

 

41,922

 

Taxes

 

 

 

 

 

 

44,168

 

 

 

9,276

 

Depreciation & amortization

 

 

 

 

 

 

628,225

 

 

 

524,067

 

EBITDA (loss)

 

 

 

 

 

 

460,919

 

 

 

(1,899,813

)

Bad debt expense

 

 

 

 

 

 

407,759

 

 

 

171,084

 

Non-recurring charges

 

 

 

 

 

 

 

 

 

118,872

 

Stock-based compensation

 

 

 

 

 

 

492,130

 

 

 

305,315

 

Adjusted EBITDA (Loss)

 

 

 

 

 

$

1,360,808

 

 

$

(1,304,542

)


About Aspen Group, Inc.:


Aspen Group, Inc. is an education technology holding company that leverages its infrastructure and expertise to allow its two universities, Aspen University and United States University, to deliver on the vision of making college affordable again.


Forward-Looking Statements:


This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 our annual revenue growth, Pre-Licensure BSN expansion, and forecasted LTV and bookings. The words “believe,” “may,” “estimate,” “continue,” “anticipate,” “intend,” “should,” “plan,” “could,” “target,” “potential,” “is likely,” “will,” “expect” and similar expressions, as they relate to us, are intended to identify forward-looking statements. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy and financial needs. Important factors that could cause actual results to differ from those in the forward-looking statements include the continued high demand for nurses, the continued effectiveness of our marketing efforts, unanticipated delays in opening new campuses, failure to continue to obtain enrollments at low acquisition costs and keeping instructional costs down, potential student attrition and national and local economic factors. Other risks are included in our filings with the SEC including our Form 10-K for the year ended April 30, 2019 and Form 10-Q for the three months ended July 31, 2019. Any forward-looking statement made by us herein speaks only as of the date on which it is made. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. We undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by law.


Investor Relations Contact:


Kim Rogers
Managing Director
Hayden IR
385-831-7337 
Kim@HaydenIR.com
















4



 


ASPEN GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS


 

October 31, 2019

 

April 30, 2019

 

(Unaudited)

 

 

Assets

 

 

 

Current assets:

 

 

 

Cash

$

6,472,417

 

$

9,519,352

Restricted cash

454,288

 

448,400

Accounts receivable, net of allowance of $1,892,318 and $1,247,031, respectively

12,813,517

 

10,656,470

Prepaid expenses

788,929

 

410,745

Other receivables

312

 

2,145

Other current assets

172,507

 

Total current assets

20,701,970

 

21,037,112

 

 

 

 

Property and equipment:

 

 

 

Call center equipment

270,010

 

193,774

Computer and office equipment

345,241

 

327,621

Furniture and fixtures

1,484,930

 

1,381,271

Software

5,178,944

 

4,314,198

 

7,279,125

 

6,216,864

Less accumulated depreciation and amortization

(2,296,365)

 

(1,825,524)

Total property and equipment, net

4,982,760

 

4,391,340

Goodwill

5,011,432

 

5,011,432

Intangible assets, net

7,991,667

 

8,541,667

Courseware, net

135,446

 

161,930

Accounts receivable, secured - net of allowance of $625,963 and $625,963, respectively

45,329

 

45,329

Long term contractual accounts receivable

5,490,733

 

3,085,243

Debt issue cost, net

250,569

 

300,824

Right of use lease asset

7,953,283

 

Deposits and other assets

324,950

 

629,626

 

 

 

 

Total assets

$

52,888,139

 

$

43,204,503

(Continued)




5



 


ASPEN GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS (CONTINUED)


 

October 31, 2019

 

April 30, 2019

 

(Unaudited)

 

 

Liabilities and Stockholders’ Equity

 

 

 

Current liabilities:

 

 

 

Accounts payable

$

1,187,748

 

$

1,699,221

Accrued expenses

739,661

 

651,418

Deferred revenue

5,509,861

 

2,456,865

Refunds due students

1,902,211

 

1,174,501

Deferred rent, current portion

 

47,436

Convertible note payable

50,000

 

50,000

    Senior secured loan payable, net of discount of $218,030 at October 31, 2019

9,781,970

 

Operating lease obligations, current portion

1,509,429

 

Other current liabilities

28,605

 

270,786

Total current liabilities

20,709,485

 

6,350,227

 

 

 

 

Senior secured loan payable, net of discount of $353,328 at April 30, 2019

 

9,646,672

Operating lease obligations

6,443,854

 

Deferred rent

767,710

 

746,176

Total liabilities

27,921,049

 

16,743,075

 

 

 

 

Commitments and contingencies

 

 

 

 

 

 

 

Stockholders’ equity:

 

 

 

Preferred stock, $0.001 par value; 1,000,000 shares authorized,

 

 

 

0 issued and outstanding at October 31, 2019 and April 30, 2019

 

Common stock, $0.001 par value; 40,000,000 shares authorized

 

 

 

19,142,316 issued and 19,125,649 outstanding at October 31, 2019

 

 

 

18,665,551 issued and 18,648,884 outstanding at April 30, 2019

19,142

 

18,666

Additional paid-in capital

69,781,363

 

68,562,727

Treasury stock (16,667 shares)

(70,000)

 

(70,000)

Accumulated deficit

(44,763,415)

 

(42,049,965)

Total stockholders’ equity

24,967,090

 

26,461,428

 

 

 

 

Total liabilities and stockholders’ equity

$

52,888,139

 

$

43,204,503




6



 


ASPEN GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)


 

Three Months Ended
October 31,

 

Six Months Ended
October 31,

 

2019

 

2018

 

2019

 

2018

Revenues

$

12,085,965

 

$

8,095,344

 

$

22,443,947

 

$

15,316,649

 

 

 

 

 

 

 

 

Operating expenses

 

 

 

 

 

 

 

Cost of revenues (exclusive of depreciation and amortization shown separately below)

4,188,056

 

3,835,515

 

8,541,114

 

7,587,907

General and administrative

7,601,459

 

6,210,411

 

14,638,609

 

12,034,543

Depreciation and amortization

628,225

 

524,067

 

1,234,799

 

1,022,172

Total operating expenses

12,417,740

 

10,569,993

 

24,414,522

 

20,644,622

 

 

 

 

 

 

 

 

Operating loss

(331,775)

 

(2,474,649)

 

(1,970,575)

 

(5,327,973)

 

 

 

 

 

 

 

 

Other income (expense)

 

 

 

 

 

 

 

Other income

132,567

 

41,493

 

155,369

 

97,894

Interest expense

(428,960)

 

(41,922)

 

(852,649)

 

(82,275)

Total other income/(expense), net

(296,393)

 

(429)

 

(697,280)

 

15,619

 

 

 

 

 

 

 

 

Loss before income taxes

(628,168)

 

(2,475,078)

 

(2,667,855)

 

(5,312,354)

 

 

 

 

 

 

 

 

Income tax expense

10,000

 

 

45,595

 

 

 

 

 

 

 

 

 

Net loss

$

(638,168)

 

$

(2,475,078)

 

$

(2,713,450)

 

$

(5,312,354)

 

 

 

 

 

 

 

 

Net loss per share allocable to common stockholders - basic and diluted

$

(0.03)

 

$

(0.13)

 

$

(0.14)

 

$

(0.29)

 

 

 

 

 

 

 

 

Weighted average number of common stock outstanding - basic and diluted

18,985,371

 

18,335,413

 

18,859,344

 

18,326,621




7



 


ASPEN GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

Three Months Ended October 31, 2019 and 2018

(Unaudited)



 

Common Stock

 

Additional
Paid-In
Capital

 

Treasury
Stock

 

Accumulated
Deficit

 

Total
Stockholders’
Equity

 

Shares

 

Amount

 

 

 

 

Balance at July 31, 2019

18,913,527

 

$

18,914

 

$

69,146,123

 

$

(70,000)

 

$

(44,125,247)

 

$

24,969,790

 

 

 

 

 

 

 

 

 

 

 

 

Stock-based compensation

 

 

391,067

 

 

 

391,067

Common stock issued for cashless stock options exercised

80,313

 

80

 

(80)

 

 

 

Common stock issued for stock options exercised for cash

90,950

 

90

 

192,432

 

 

 

192,522

Common stock issued for cashless warrant exercise

57,526

 

58

 

(58)

 

 

 

Amortization of warrant based cost

 

 

9,125

 

 

 

9,125

Amortization of restricted stock issued for services

 

 

42,754

 

 

 

42,754

Net loss

 

 

 

 

(638,168)

 

(638,168)

Balance at October 31, 2019

19,142,316

 

$

19,142

 

$

69,781,363

 

$

(70,000)

 

$

(44,763,415)

 

$

24,967,090

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common Stock

 

Additional
Paid-In
Capital

 

Treasury
Stock

 

Accumulated
Deficit

 

Total
Stockholders’
Equity

 

Shares

 

Amount

 

 

 

 

Balance at July 31, 2018

18,341,440

 

$

18,341

 

$

66,744,959

 

$

(70,000)

 

$

(35,609,024)

 

$

31,084,276

 

 

 

 

 

 

 

 

 

 

 

 

Stock-based compensation

 

 

305,315

 

 

 

305,315

Common stock issued for cashless stock options exercised

25,534

 

26

 

(26)

 

 

 

Common stock issued for stock options exercised for cash

24,118

 

24

 

52,261

 

 

 

52,285

Net loss

 

 

 

 

(2,475,078)

 

(2,475,078)

Balance at October 31, 2018

18,391,092

 

$

18,391

 

$

67,102,509

 

$

(70,000)

 

$

(38,084,102)

 

$

28,966,798








8



 


ASPEN GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (CONTINUED)

Six Months Ended October 31, 2019 and 2018

(Unaudited)



 

Common Stock

 

Additional
Paid-In
Capital

 

Treasury
Stock

 

Accumulated
Deficit

 

Total
Stockholders’
Equity

 

Shares

 

Amount

 

 

 

 

Balance at April 30, 2019

18,665,551

 

$

18,666

 

$

68,562,727

 

$

(70,000)

 

$

(42,049,965)

 

$

26,461,428

 

 

 

 

 

 

 

 

 

 

 

 

Stock-based compensation

 

 

889,484

 

 

 

889,484

Common stock issued for cashless stock options exercised

182,207

 

182

 

(182)

 

 

 

Common stock issued for stock options exercised for cash

112,826

 

113

 

237,600

 

 

 

237,713

Common stock issued for cashless warrant exercise

76,929

 

77

 

(77)

 

 

 

Amortization of warrant based cost

 

 

18,565

 

 

 

18,565

Amortization of restricted stock issued for services

 

 

73,350

 

 

 

73,350

Restricted Stock Issued for Services, subject to vesting

104,803

 

104

 

(104)

 

 

 

Net loss

 

 

 

 

(2,713,450)

 

(2,713,450)

Balance at October 31, 2019

19,142,316

 

$

19,142

 

$

69,781,363

 

$

(70,000)

 

$

(44,763,415)

 

$

24,967,090

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common Stock

 

Additional
Paid-In
Capital

 

Treasury
Stock

 

Accumulated
Deficit

 

Total
Stockholders’
Equity

 

Shares

 

Amount

 

 

 

 

Balance at April 30, 2018

18,333,521

 

$

18,334

 

$

66,557,005

 

$

(70,000)

 

$

(32,771,748)

 

$

33,733,591

 

 

 

 

 

 

 

 

 

 

 

 

Stock-based compensation

 

 

515,291

 

 

 

515,291

Common stock issued for cashless stock options exercised

30,764

 

31

 

(31)

 

 

 

Common stock issued for stock options exercised for cash

26,807

 

26

 

60,076

 

 

 

60,102

Purchase of treasury stock, net of broker fees

 

 

 

(7,370,000)

 

 

(7,370,000)

Re-sale of treasury stock, net of broker fees

 

 

 

7,370,000

 

 

7,370,000

Fees associated with equity raise

 

 

(29,832)

 

 

 

(29,832)

Net loss

 

 

 

 

(5,312,354)

 

(5,312,354)

Balance at October 31, 2018

18,391,092

 

$

18,391

 

$

67,102,509

 

$

(70,000)

 

$

(38,084,102)

 

$

28,966,798




9



 


ASPEN GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)


 

Six Months Ended
October 31,

 

2019

 

2018

Cash flows from operating activities:

 

 

 

Net loss

$

(2,713,450)

 

$

(5,312,354)

Adjustments to reconcile net loss to net cash used in operating activities:

 

 

 

Bad debt expense

648,658

 

292,889

Depreciation and amortization

1,234,799

 

1,022,172

Stock-based compensation

889,484

 

515,291

Warrants issued for services

18,565

 

Loss on asset disposition

3,918

 

Amortization of debt discounts

135,298

 

Amortization of debt issue costs

50,255

 

Amortization of prepaid shares for services

 

8,285

Non-cash payments to investor relations firm

73,350

 

Changes in operating assets and liabilities:

 

 

 

Accounts receivable

(5,211,195)

 

(4,028,143)

Prepaid expenses

(378,184)

 

(238,951)

Other receivables

1,833

 

179,196

Other current assets

(172,507)

 

Other assets

304,676

 

(20,846)

Accounts payable

(511,473)

 

(601,225)

Accrued expenses

88,243

 

72,737

Deferred rent

(25,902)

 

453,880

Refunds due students

727,710

 

366,098

Deferred revenue

3,052,996

 

1,631,170

Other liabilities

(242,181)

 

172,378

Net cash used in operating activities

(2,025,107)

 

(5,487,423)

 

 

 

 

Cash flows from investing activities:

 

 

 

Purchases of courseware and accreditation

(9,575)

 

(85,821)

Purchases of property and equipment

(1,244,078)

 

(1,345,777)

Net cash used in investing activities

(1,253,653)

 

(1,431,598)

 

 

 

 

Cash flows from financing activities:

 

 

 

Disbursements for equity offering costs

 

(29,832)

Proceeds of stock options exercised and warrants exercised

237,713

 

60,102

Purchase of treasury stock, net of broker fees

 

(7,370,000)

Re-sale of treasury stock, net of broker fees

 

7,370,000

Net cash provided by financing activities

237,713

 

30,270

 

 

 

 

Net (decrease) in cash and cash equivalents

(3,041,047)

 

(6,888,751)

Cash, restricted cash, and cash equivalents at beginning of period

9,967,752

 

14,803,065

Cash and cash equivalents at end of period

$

6,926,705

 

$

7,914,314

 

 

 

 

Supplemental disclosure cash flow information

 

 

 

Cash paid for interest

$

652,121

 

$

Cash paid for income taxes

$

49,595

 

$

 

 

 

 

Supplemental disclosure of non-cash investing and financing activities

 

 

 

Common stock issued for services

$

178,447

 

$

Right-of-use lease asset offset against operating lease obligations

$

7,469,167

 

$



10



 


ASPEN GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)

(Unaudited)

The following table provides a reconciliation of cash and restricted cash reported within the unaudited consolidated balance sheets that sum to the same such amounts shown in the unaudited consolidated statements of cash flows:

 

 

 

 

 

Six Months Ended
October 31,

 

2019

 

2018

Cash

$

6,472,417

 

$

7,723,808

Restricted cash

454,288

 

190,506

Total cash and restricted cash

$

6,926,705

 

$

7,914,314




11