Aspen Group Reports Revenue of $17.1 million for Second Quarter Fiscal 2023
Aspen Group (ASPU) reported its fiscal Q2 2023 financial results, revealing a 60% gross margin, up from 51% year-over-year, and a net loss reduced to $(2.3) million from $(2.9) million. The company's revenue fell by 10% to $17.1 million, while adjusted EBITDA improved to $0.5 million compared to $(0.7) million year-over-year. Positive operating cash flow totaled $1 million, driven by cost reductions from the restructuring plan. Active student enrollment decreased by 23% to 10,957 as marketing expenditures were curtailed.
- Gross margin increased to 60% from 51% year-over-year.
- Net loss narrowed to $(2.3) million, a 20% improvement from the previous year.
- Adjusted EBITDA turned positive at $0.5 million compared to $(0.7) million last year.
- Positive operating cash flow of $1 million, a turnaround from $(1.0) million.
- Revenue declined 10% to $17.1 million from $18.9 million.
- New student enrollments plummeted 46% year-over-year to 1,290.
- Active student body decreased 23% to 10,957.
- Restructuring plan increases year-over-year gross margin to
60% from51% , and narrows net loss to$(2.3) million from$(2.9) million - Adjusted EBITDA of
$0.5 million versus$(0.7) million in prior year quarter - Positive operating cash flow of
$1.0 million versus$(1.0) million in prior year quarter
NEW YORK, Dec. 13, 2022 (GLOBE NEWSWIRE) -- Aspen Group, Inc. (Nasdaq: ASPU) (“AGI” or the “Company”), an education technology holding company, today announced financial results for its second quarter fiscal year 2023 ended October 31, 2022.
Second Quarter Fiscal Year 2023 Summary Results
Three Months Ended October 31, | Six Months Ended October 31, | ||||||||||||||||||
2022 | 2021 | 2022 | 2021 | ||||||||||||||||
$ in millions, except per share data | |||||||||||||||||||
Revenue | $ | 17.1 | $ | 18.9 | $ | 36.0 | $ | 38.4 | |||||||||||
Gross Profit1 | $ | 10.2 | $ | 9.7 | $ | 18.4 | $ | 20.1 | |||||||||||
Gross Margin (%)1 | 60 | % | 51 | % | 51 | % | 52 | % | |||||||||||
Net Income (Loss) | $ | (2.3 | ) | $ | (2.9 | ) | $ | (6.0 | ) | $ | (3.7 | ) | |||||||
Earnings (Loss) per Share | $ | (0.09 | ) | $ | (0.11 | ) | $ | (0.24 | ) | $ | (0.15 | ) | |||||||
EBITDA2 | $ | (0.6 | ) | $ | (1.9 | ) | $ | (2.8 | ) | $ | (1.8 | ) | |||||||
Adjusted EBITDA2 | $ | 0.5 | $ | (0.7 | ) | $ | (0.6 | ) | $ | (0.2 | ) |
_______________________
1 GAAP gross profit calculation includes marketing and promotional costs, instructional costs and services, and amortization expense of
2 Non-GAAP financial measures. See reconciliations of GAAP to non-GAAP financial measures under "Non-GAAP–Financial Measures" starting on page 5.
“We are encouraged by our second quarter results which reflect the impact of reduced marketing and general and administrative spend as part of our restructuring initiative that we launched in the prior quarter,” said Michael Mathews, Chairman, and CEO of AGI. “Gross margin improved by 900 basis points on lower revenue, and we narrowed our net loss and delivered positive adjusted EBITDA. USU’s revenue grew
“The restructuring initiated in the first quarter of fiscal year 2023 reduced cash used in operations in the second quarter by
Mr. Mathews concluded, “As previously stated, we engaged Lampert Capital Advisors to assist with securing an accounts receivable (AR) financing agreement. After conducting due diligence on our accounts receivable, Lampert has begun outreach to prospective lenders.”
Fiscal Q2 2023 Financial and Operational Results (compared to Fiscal Q2 2022)
Revenue decreased by
Three Months Ended October 31, | |||||||||||||
2022 | $ Change | % Change | 2021 | ||||||||||
AU | $ | 10,341,903 | $ | (2,416,948 | ) | (19)% | $ | 12,758,851 | |||||
USU | 6,732,644 | 551,284 | 6,181,360 | ||||||||||
Revenue | $ | 17,074,547 | $ | (1,865,664 | ) | (10)% | $ | 18,940,211 |
AU revenue decreased by
USU revenue increased
GAAP gross profit increased
Gross margin was
During Fiscal Q2 2023, AU instructional costs and services represented
The following tables present the Company’s net (loss) income, both per subsidiary and total:
Three Months Ended October 31, 2022 | |||||||||||||||
Consolidated | AGI Corporate | AU | USU | ||||||||||||
Net (loss) income | $ | (2,293,640 | ) | $ | (5,150,209 | ) | $ | 1,067,885 | $ | 1,788,684 | |||||
Net loss per share | $ | (0.09 | ) |
Three Months Ended October 31, 2021 | |||||||||||||||
Consolidated | AGI Corporate | AU | USU | ||||||||||||
Net (loss) income | $ | (2,852,258 | ) | $ | (5,059,164 | ) | $ | 1,329,813 | $ | 877,093 | |||||
Net loss per share | $ | (0.11 | ) |
Net loss decreased
The following tables present the Company’s Non-GAAP measures, both per subsidiary and total. See reconciliations of GAAP to non-GAAP financial measures under “Non-GAAP–Financial Measures” starting on page 5.
Three Months Ended October 31, 2022 | |||||||
Consolidated | AGI Corporate | AU | USU | ||||
EBITDA | |||||||
EBITDA Margin | (4)% | NM | |||||
Adjusted EBITDA | |||||||
Adjusted EBITDA Margin | NM |
Three Months Ended October 31, 2021 | |||||||
Consolidated | AGI Corporate | AU | USU | ||||
EBITDA | |||||||
EBITDA Margin | (10)% | NM | |||||
Adjusted EBITDA | |||||||
Adjusted EBITDA Margin | (4)% | NM |
Operating Metrics
New Student Enrollments
New student enrollments decreased
Five quarters of new student enrollments are shown below:
New Student Quarterly Enrollments | ||||||||||||||
Q2'22 | Q3'22 | Q4'22 | Q1'23 | Q2'23 | ||||||||||
Aspen University | 1,750 | 1,301 | 1,010 | 868 | 784 | |||||||||
USU | 630 | 481 | 525 | 447 | 506 | |||||||||
Total | 2,380 | 1,782 | 1,535 | 1,315 | 1,290 |
New student enrollments, bookings and ARPU for Q2’23 versus Q2’22 are shown below (rounding differences may occur):
Second Quarter Bookings1 and Average Revenue Per Enrollment (ARPU)1 | |||||||||||||||||
Q2'22 Enrollments | Q2'22 Bookings 1 | Q2'23 Enrollments | Q2'23 Bookings 1 | Percent Change Total Bookings & ARPU 1 | |||||||||||||
Aspen University | 1,750 | $ | 26,134,500 | 784 | $ | 8,450,250 | |||||||||||
USU | 630 | $ | 11,226,600 | 506 | $ | 9,016,920 | |||||||||||
Total | 2,380 | $ | 37,361,100 | 1,290 | $ | 17,467,170 | (53 | ) | % | ||||||||
ARPU | $ | 15,698 | $ | 13,540 | (14 | ) | % |
_____________________
1 “Bookings” are defined by multiplying Lifetime Value (LTV) by new student enrollments for each operating unit. “Average Revenue Per Enrollment” (ARPU) is defined by dividing total Bookings by total new student enrollments for each operating unit.
Total Active Student Body
AGI's active degree-seeking student body, including AU and USU, declined
Five quarters of total active student body is shown below:
Total Active Student Body by Quarter | ||||||||||||||
Q2'22 | Q3'22 | Q4'22 | Q1'23 | Q2'23 | ||||||||||
Aspen University | 11,184 | 10,736 | 10,225 | 9,133 | 7,973 | |||||||||
USU | 3,134 | 2,988 | 3,109 | 2,915 | 2,984 | |||||||||
Total | 14,318 | 13,724 | 13,334 | 12,048 | 10,957 |
Nursing Students
Students seeking nursing degrees were 9,392, or
Nursing Student Body by Quarter | ||||||||||||||
Q2'22 | Q3'22 | Q4'22 | Q1'23 | Q2'23 | ||||||||||
Aspen University | 9,531 | 9,116 | 8,632 | 7,686 | 6,640 | |||||||||
USU | 2,911 | 2,773 | 2,890 | 2,708 | 2,752 | |||||||||
Total | 12,442 | 11,889 | 11,522 | 10,394 | 9,392 |
Liquidity
At October 31, 2022, the Company had unrestricted cash of
In a subsequent event following the close of the quarter on October 31, 2022, the surety bond firm recently agreed to return to the Company
Cash flow used in operations for the six months ended October 31, 2022 was
Conference Call
Aspen Group, Inc. will host a conference call to discuss its second quarter fiscal year 2023 results on Tuesday, December 13, 2022, at 4:30 pm ET. Aspen Group, Inc. will issue a press release reporting results after the market closes on that day. The conference call can be accessed by dialing toll-free (877) 704-4453 (U.S.) or (201) 389-0920 (International), passcode 13734314.
Subsequent to the call, a transcript of the audio cast will be available from the Company’s website at www.aspu.com. A dial-in replay will be available starting at 7:30 pm ET on December 13, 2022 through 11:59 pm ET on December 20, 2022, which can be accessed by dialing toll-free (844) 512-2921 (U.S.) or (412) 317-6671 (International), passcode 13734314.
For additional information on the financial statements and performance, please refer to the Aspen Group, Inc. Form 10-Q for the second quarter of fiscal year 2023 and Q2 2023 Financial Results Presentation published on the Company’s website at www.aspu.com, on the Presentations page under Company Info.
Non-GAAP – Financial Measures
This press release includes both financial measures in accordance with 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 EBITDA, Adjusted EBITDA and Adjusted EBITDA Margin, which are non-GAAP financial measures. We believe that management, analysts, and shareholders benefit from referring to the following non-GAAP financial measures to evaluate and assess our core operating results from period-to-period after removing the impact of items that affect comparability. Our management recognizes that the non-GAAP financial measures have inherent limitations because of the excluded items described below.
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 rules of the Securities and Exchange Commission (the “SEC”).
AGI defines Adjusted EBITDA as EBITDA excluding: (1) bad debt expense; (2) stock-based compensation; and (3) non-recurring charges.
The following table presents a reconciliation of net loss to EBITDA and Adjusted EBITDA and of net income (loss) margin to the Adjusted EBITDA margin:
Three Months Ended October 31, | Six Months Ended October 31, | ||||||||||||||||||
2022 | 2021 | 2022 | 2021 | ||||||||||||||||
Net loss | $ | (2,293,640 | ) | $ | (2,852,258 | ) | $ | (6,008,611 | ) | $ | (3,723,146 | ) | |||||||
Interest expense, net | 708,705 | 138,064 | 1,289,285 | 170,196 | |||||||||||||||
Taxes | 46,501 | 5,900 | 76,822 | 156,910 | |||||||||||||||
Depreciation and amortization | 935,070 | 817,234 | 1,856,178 | 1,596,643 | |||||||||||||||
EBITDA | (603,364 | ) | (1,891,060 | ) | (2,786,326 | ) | (1,799,397 | ) | |||||||||||
Bad debt expense | 450,000 | 350,000 | 800,000 | 700,000 | |||||||||||||||
Stock-based compensation | 458,336 | 722,158 | 504,666 | 1,264,870 | |||||||||||||||
Non-recurring charges - Severance | — | — | 125,000 | 19,665 | |||||||||||||||
Non-recurring charges (income) - Other | 232,367 | 103,754 | 717,299 | (394,366 | ) | ||||||||||||||
Adjusted EBITDA | $ | 537,339 | $ | (715,148 | ) | $ | (639,361 | ) | $ | (209,228 | ) | ||||||||
Net loss Margin | (13 | ) | % | (15 | ) | % | (17 | ) | % | (10 | ) | % | |||||||
Adjusted EBITDA Margin | 3 | % | (4 | ) | % | (2 | ) | % | (1 | ) | % |
The following tables present a reconciliation of net income (loss) to EBITDA and Adjusted EBITDA and of net income (loss) margin to the Adjusted EBITDA margin by business unit:
Three Months Ended October 31, 2022 | ||||||||||||||||||||
Consolidated | AGI Corporate | AU | USU | |||||||||||||||||
Net income (loss) | $ | (2,293,640 | ) | $ | (5,150,209 | ) | $ | 1,067,885 | $ | 1,788,684 | ||||||||||
Interest expense, net | 708,705 | 710,237 | (1,239 | ) | (293 | ) | ||||||||||||||
Taxes | 46,501 | 8,350 | 27,776 | 10,375 | ||||||||||||||||
Depreciation and amortization | 935,070 | 68,860 | 757,770 | 108,440 | ||||||||||||||||
EBITDA | (603,364 | ) | (4,362,762 | ) | 1,852,192 | 1,907,206 | ||||||||||||||
Bad debt expense | 450,000 | — | 225,000 | 225,000 | ||||||||||||||||
Stock-based compensation | 458,336 | 404,391 | 37,338 | 16,607 | ||||||||||||||||
Non-recurring charges - Other | 232,367 | 232,367 | — | — | ||||||||||||||||
Adjusted EBITDA | $ | 537,339 | $ | (3,726,004 | ) | $ | 2,114,530 | $ | 2,148,813 | |||||||||||
Net income (loss) Margin | (13 | ) | % | NM | 10 | % | 27 | % | ||||||||||||
Adjusted EBITDA Margin | 3 | % | NM | 20 | % | 32 | % |
_____________________
NM – Not meaningful
Three Months Ended October 31, 2021 | ||||||||||||||||||
Consolidated | AGI Corporate | AU | USU | |||||||||||||||
Net income (loss) | $ | (2,852,258 | ) | $ | (5,059,164 | ) | $ | 1,329,813 | $ | 877,093 | ||||||||
Interest expense, net | 138,064 | 139,239 | (739 | ) | (436 | ) | ||||||||||||
Taxes | 5,900 | 1,249 | 3,400 | 1,251 | ||||||||||||||
Depreciation and amortization | 817,234 | 38,141 | 681,107 | 97,986 | ||||||||||||||
EBITDA | (1,891,060 | ) | (4,880,535 | ) | 2,013,581 | 975,894 | ||||||||||||
Bad debt expense | 350,000 | — | 250,000 | 100,000 | ||||||||||||||
Stock-based compensation | 722,158 | 672,967 | 23,298 | 25,893 | ||||||||||||||
Non-recurring charges - Other | 103,754 | 58,325 | 45,429 | — | ||||||||||||||
Adjusted EBITDA | $ | (715,148 | ) | $ | (4,149,243 | ) | $ | 2,332,308 | $ | 1,101,787 | ||||||||
Net income (loss) Margin | (15 | ) | % | NM | 10 | % | 14 | % | ||||||||||
Adjusted EBITDA Margin | (4 | ) | % | NM | 18 | % | 18 | % |
Definitions
Lifetime Value ("LTV") – is calculated as the weighted average total amount of tuition and fees paid by every new student that enrolls in the Company’s universities, after giving effect to attrition.
Bookings – is defined by multiplying LTV by new student enrollments for each operating unit.
Average Revenue per Enrollment ("ARPU") – is defined by dividing total bookings by total enrollments.
Adjusted EBITDA Margin – is defined as Adjusted EBITDA divided by revenue. We believe Adjusted EBITDA margin is useful for management, analysts and investors as this measure allows for a more meaningful comparison between our performance and that of our competitors. Adjusted EBITDA margin has certain limitations in that it does not take into account the impact to our consolidated statement of operations of certain expenses.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 including the expected impact of our efforts to reduce expenses, our ability to generate positive operating cash flow in the second half of fiscal 2023, continued strong demand for the MSN-FNP program, and our plans and efforts to locate and close an accounts receivable facility, and liquidity. 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 management’s ability to navigate the challenges we face due to adverse regulatory developments and our ability to prepare and execute a viable business strategy following those events, the continued demand of nursing students for our programs, student attrition, national and local economic factors, competition from nursing schools in local markets, the competitive impact from the trend of major non-profit universities using online education and consolidation among our competitors, and the myriad of risks which may affect our ability to close an accounts receivable financing ranging from locating a willing lender to contractual difficulties including covenants which prevent us from closing a facility. Other risks are included in our filings with the SEC including our Form 10-K for the year ended April 30, 2022. 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.
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.
Investor Relations Contact
Kim Rogers
Managing Director
Hayden IR
385-831-7337
Kim@HaydenIR.com
GAAP Financial Statements
ASPEN GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
October 31, 2022 | April 30, 2022 | ||||||
(Unaudited) | |||||||
Assets | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 2,306,480 | $ | 6,482,750 | |||
Restricted cash | 6,423,525 | 6,433,397 | |||||
Accounts receivable, net of allowance of | 22,391,574 | 24,359,241 | |||||
Prepaid expenses | 1,600,945 | 1,358,635 | |||||
Other current assets | 775,524 | 748,568 | |||||
Total current assets | 33,498,048 | 39,382,591 | |||||
Property and equipment: | |||||||
Computer equipment and hardware | 1,573,046 | 1,516,475 | |||||
Furniture and fixtures | 2,219,245 | 2,193,261 | |||||
Leasehold improvements | 7,613,240 | 7,179,896 | |||||
Instructional equipment | 756,568 | 715,652 | |||||
Software | 10,990,705 | 10,285,096 | |||||
Construction in progress | — | 2,100 | |||||
23,152,804 | 21,892,480 | ||||||
Less: accumulated depreciation and amortization | (10,206,811 | ) | (8,395,001 | ) | |||
Total property and equipment, net | 12,945,993 | 13,497,479 | |||||
Goodwill | 5,011,432 | 5,011,432 | |||||
Intangible assets, net | 7,900,000 | 7,900,000 | |||||
Courseware, net | 278,208 | 274,047 | |||||
Long-term contractual accounts receivable | 16,335,657 | 11,406,525 | |||||
Deferred financing costs | 331,423 | 369,902 | |||||
Operating lease right-of-use assets, net | 14,271,481 | 12,645,950 | |||||
Deposits and other assets | 536,517 | 578,125 | |||||
Total assets | $ | 91,108,759 | $ | 91,066,051 |
ASPEN GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS (CONTINUED)
October 31, 2022 | April 30, 2022 | ||||||
(Unaudited) | |||||||
Liabilities and Stockholders’ Equity | |||||||
Liabilities: | |||||||
Current liabilities: | |||||||
Accounts payable | $ | 2,814,399 | $ | 1,893,287 | |||
Accrued expenses | 3,147,485 | 2,821,432 | |||||
Deferred revenue | 8,772,017 | 5,889,911 | |||||
Due to students | 3,165,651 | 4,063,811 | |||||
Operating lease obligations, current portion | 2,204,342 | 2,036,570 | |||||
Other current liabilities | 554,946 | 130,262 | |||||
Total current liabilities | 20,658,840 | 16,835,273 | |||||
Long-term debt, net | 14,904,556 | 14,875,735 | |||||
Operating lease obligations, less current portion | 18,455,549 | 16,809,319 | |||||
Total liabilities | 54,018,945 | 48,520,327 | |||||
Commitments and contingencies | |||||||
Stockholders’ equity: | |||||||
Preferred stock, | — | — | |||||
Common stock, | 25,461 | 25,358 | |||||
Additional paid-in capital | 112,634,162 | 112,081,564 | |||||
Treasury stock (155,486 at both October 31, 2022 and April 30, 2022) | (1,817,414 | ) | (1,817,414 | ) | |||
Accumulated deficit | (73,752,395 | ) | (67,743,784 | ) | |||
Total stockholders’ equity | 37,089,814 | 42,545,724 | |||||
Total liabilities and stockholders’ equity | $ | 91,108,759 | $ | 91,066,051 |
ASPEN GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended October 31, | Six Months Ended October 31, | ||||||||||||||
2022 | 2021 | 2022 | 2021 | ||||||||||||
Revenue | $ | 17,074,547 | $ | 18,940,211 | $ | 35,968,460 | $ | 38,371,206 | |||||||
Operating expenses: | |||||||||||||||
Cost of revenue (exclusive of depreciation and amortization shown separately below) | 6,347,008 | 8,789,201 | 16,552,559 | 17,382,769 | |||||||||||
General and administrative | 10,883,118 | 11,641,312 | 21,415,138 | 22,587,789 | |||||||||||
Bad debt expense | 450,000 | 350,000 | 800,000 | 700,000 | |||||||||||
Depreciation and amortization | 935,070 | 817,234 | 1,856,178 | 1,596,643 | |||||||||||
Total operating expenses | 18,615,196 | 21,597,747 | 40,623,875 | 42,267,201 | |||||||||||
Operating loss | (1,540,649 | ) | (2,657,536 | ) | (4,655,415 | ) | (3,895,995 | ) | |||||||
Other income (expense): | |||||||||||||||
Interest expense | (710,372 | ) | (139,502 | ) | (1,291,665 | ) | (173,041 | ) | |||||||
Other income (expense), net | 3,882 | (49,320 | ) | 15,291 | 502,800 | ||||||||||
Total other (expense) income, net | (706,490 | ) | (188,822 | ) | (1,276,374 | ) | 329,759 | ||||||||
Loss before income taxes | (2,247,139 | ) | (2,846,358 | ) | (5,931,789 | ) | (3,566,236 | ) | |||||||
Income tax expense | 46,501 | 5,900 | 76,822 | 156,910 | |||||||||||
Net loss | $ | (2,293,640 | ) | $ | (2,852,258 | ) | $ | (6,008,611 | ) | $ | (3,723,146 | ) | |||
Net loss per share - basic and diluted | $ | (0.09 | ) | $ | (0.11 | ) | $ | (0.24 | ) | $ | (0.15 | ) | |||
Weighted average number of common stock outstanding - basic and diluted | 25,282,947 | 24,957,046 | 25,242,833 | 24,935,793 |
ASPEN GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Six Months Ended October 31, | |||||||
2022 | 2021 | ||||||
Cash flows from operating activities: | |||||||
Net loss | $ | (6,008,611 | ) | $ | (3,723,146 | ) | |
Adjustments to reconcile net loss to net cash used in operating activities: | |||||||
Bad debt expense | 800,000 | 700,000 | |||||
Depreciation and amortization | 1,856,178 | 1,596,643 | |||||
Stock-based compensation | 504,666 | 1,264,870 | |||||
Amortization of warrant-based cost | 14,000 | 27,583 | |||||
Amortization of deferred financing costs | 269,133 | 19,643 | |||||
Amortization of debt discounts | 59,000 | 18,056 | |||||
Common stock issued for services | 24,500 | — | |||||
Loss on asset disposition | — | 36,442 | |||||
Non-cash lease benefit | (229,809 | ) | (63,099 | ) | |||
Tenant improvement allowances received from landlords | 418,280 | 816,591 | |||||
Changes in operating assets and liabilities: | |||||||
Accounts receivable | (3,761,463 | ) | (7,699,220 | ) | |||
Prepaid expenses | (242,310 | ) | (520,685 | ) | |||
Other current assets | (26,956 | ) | 47,901 | ||||
Accounts receivable, other | — | 45,329 | |||||
Deposits and other assets | 41,608 | (15,357 | ) | ||||
Accounts payable | 921,112 | 636,136 | |||||
Accrued expenses | 326,053 | (268,088 | ) | ||||
Due to students | (898,160 | ) | 472,159 | ||||
Deferred revenue | 2,882,106 | 3,366,227 | |||||
Other current liabilities | 424,685 | (211,918 | ) | ||||
Net cash used in operating activities | (2,625,988 | ) | (3,453,933 | ) | |||
Cash flows from investing activities: | |||||||
Purchases of courseware and accreditation | (48,532 | ) | (149,751 | ) | |||
Disbursements for reimbursable leasehold improvements | (418,280 | ) | (816,591 | ) | |||
Purchases of property and equipment | (842,044 | ) | (1,883,310 | ) | |||
Net cash used in investing activities | (1,308,856 | ) | (2,849,652 | ) | |||
Cash flows from financing activities: | |||||||
Proceeds from sale of common stock, net of underwriter costs | 9,535 | — | |||||
Payment of commitment fee for 2022 Credit Facility | (200,000 | ) | — | ||||
Payments of deferred financing costs | (60,833 | ) | — | ||||
Borrowings under the 2018 Credit Facility | — | 5,000,000 | |||||
Proceeds from stock options exercised | — | 56,034 | |||||
Net cash (used in) provided by financing activities | (251,298 | ) | 5,056,034 |
ASPEN GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)
(Unaudited)
Six Months Ended October 31, | |||||||
2022 | 2021 | ||||||
Net decrease in cash, cash equivalents and restricted cash | $ | (4,186,142 | ) | $ | (1,247,551 | ) | |
Cash, cash equivalents and restricted cash at beginning of period | 12,916,147 | 13,666,079 | |||||
Cash, cash equivalents and restricted cash at end of period | $ | 8,730,005 | $ | 12,418,528 | |||
Supplemental disclosure cash flow information: | |||||||
Cash paid for interest | $ | 802,167 | $ | 98,904 | |||
Cash paid for income taxes | $ | 22,522 | $ | 157,552 | |||
Supplemental disclosure of non-cash investing and financing activities: | |||||||
Warrants issued as part of the 2018 Credit Facility amendment | $ | — | $ | 137,500 |
The following table provides a reconciliation of cash and cash equivalents and restricted cash reported within the accompanying consolidated balance sheet to the total amounts shown in the accompanying unaudited consolidated statements of cash flows:
October 31, | |||||||
2022 | 2021 | ||||||
Cash and cash equivalents | $ | 2,306,480 | $ | 10,985,131 | |||
Restricted cash | 6,423,525 | 1,433,397 | |||||
Total cash, cash equivalents and restricted cash | $ | 8,730,005 | $ | 12,418,528 |
FAQ
What are Aspen Group's Q2 2023 financial results?
How did Aspen Group's gross margin change in Q2 2023?
Was there any improvement in Aspen Group's net loss for Q2 2023?
What was the impact of restructuring on Aspen Group's financials?