Have
your say
DESPITE a difficult year, Aspen Group ‒ which operates a chain of 23
holiday and accommodation parks ‒ is confident about the future.
It recorded a statutory loss of $81.8m for the year but chairman Frank
Zipfinger believes hard work has provided a "sound basis" to move the
group forward.
"In the past two months we have seen benefits of having a stronger balance
sheet," he said.
Speaking at the company's annual general meeting, he said the board was
"acutely aware" that returns to shareholders in recent years had been
"unacceptable".
"Securityholders will recall that we set out at the beginning of the year
with the primary goal of simplifying and focusing the business to
concentrate on the 'value-for-money' accommodation sector," he said.
"This is an industry in which Aspen Group has an existing presence through
management of and an equity interest in the Aspen Parks Property Fund and
also ownership of the Aspen Karratha Village property."
He said achieving the goal had required disposing of non-core commercial
property, divesting a myriad of non-core residential and development
assets and reducing debts.
But for one exception, this strategy had been achieved.
In June this year, the Aspen Group had cash holdings, net of debt, of $18
million with a simplified funding structure.
Gearing was cut to zero, down from 34 percent the year before.
"To give you a perspective of how far we have come, two years ago this
business had debt of $281 million, with a complex financing arrangement of
eight debt facilities and an unsustainable overhead structure," Mr
Zipfinger said, adding that the issues had now been successfully
addressed.
"Nonetheless, it is disappointing to reflect that we recorded a statutory
loss of $82 million for the 2014 financial year, mainly in the first half
after taking impairments and losses on assets sold or held for sale.
"However, our operating results were sound, up 32 percent from the
previous year to $14.7 million and we made distributions totalling 11.5
cents per security this year."
The group recognised that as it headed into 2015 the transition of the
business would require a further review of its remuneration strategy.
"Particular focus will be on the long term incentive hurdles to ensure
they are appropriate for the business model and even further aligned with
the interest of our securityholders," Mr Zipfinger added.
