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Edited Transcript of ASPU.OB earnings conference call or presentation 10-Mar-20 8:30pm GMT

Q3 2020 Aspen Group Inc Earnings Call

DENVER Mar 27, 2020 (Thomson StreetEvents) -- Edited Transcript of Aspen Group Inc earnings conference call or presentation Tuesday, March 10, 2020 at 8:30:00pm GMT

TEXT version of Transcript

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Corporate Participants

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* Frank J. Cotroneo

Aspen Group, Inc. - CFO & Director

* Michael D. Mathews

Aspen Group, Inc. - Chairman of the Board & CEO

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Conference Call Participants

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* Austin William Moldow

Canaccord Genuity Corp., Research Division - Associate

* Darren Aftahi

Roth Capital Partners, LLC, Research Division - MD & Senior Research Analyst

* Eric Martinuzzi

Lake Street Capital Markets, LLC, Research Division - Head of Research & Senior Research Analyst

* Michael Fawzy Malouf

Craig-Hallum Capital Group LLC, Research Division - Partner, Senior Research Analyst & Head of Boston Team

* Michael John Grondahl

Northland Capital Markets, Research Division - Head of Equity Research & Senior Research Analyst

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Presentation

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Operator [1]

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Good afternoon. Welcome to Aspen Group's Fiscal Year 2020 Third Quarter Earnings Call. Please note that the company's remarks made during this call, including answers to questions, include forward-looking statements, which are subject to various risks and uncertainties.

These include statements relating to the growth of future student enrollments, bookings and ARPU, fiscal 2020 revenue growth, the expansion of the highest LTV programs, expected G&A, trends including fiscal 2020 adjusted EBITDA, gross margins, expected campus expansion, campus capital expenditures and campus operating metrics, and generating cash from operations.

Actual results may differ materially from the results predicted, and reported results should not be considered as an indication of future performance.

A discussion of risks and uncertainties related to Aspen's business is contained in its prospectus supplement dated January 17, 2020, its Form 10-K for the year ended April 30, 2019, and its third quarter 10-Q filed with the Securities and Exchange Commission and in the press release issued this afternoon. Aspen Group disclaims any obligation to update any forward-looking statement as a result of future developments.

Also, I'd like to remind you that during the course of this conference call, the company will discuss EBITDA and adjusted EBITDA, which are non-GAAP financial measures, in talking about the company's performance. Reconciliation to the most directly comparable GAAP financial measures are provided in the tables in the press release issued by the company today.

There will be a transcript of this conference call available for 1 year at the company's website. Please note that earnings slides are available on Aspen Group's website, aspu.com, in the Presentations page under Company Info.

Now I will turn the call over to Michael Matthews, Aspen Group's Chairman and Chief Executive Officer.

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Michael D. Mathews, Aspen Group, Inc. - Chairman of the Board & CEO [2]

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Good afternoon. This has been another record revenue quarter for Aspen Group and I'm extremely pleased with how my team is performing. I want to acknowledge their hard work and dedication to our mission to make college affordable again. That dedication is ultimately what produces strong financial results like we're reporting today. Thank you to all the Aspen University, United States University and AGI employees.

Okay. Let's begin today with an overview of the solid results for this quarter and the factors which drove our growth. Then I will discuss our road map for future growth.

Before we go over the quarterly results, I'd like to connect a few dots. First, I'd like to point out that since we began offering our monthly payment plan back in March of 2014, Aspen Group averaged over 50% annual growth in the 5 fiscal years thereafter. We achieved this by pursuing a plan to build a nursing education platform that could meet today's need for affordable nursing degrees.

Subsequently, in 2017, we acquired United States University featuring their master level Family Nurse Practitioner degree program. And in 2018, we launched our hybrid 3-year online/on-campus pre-licensure Bachelor of Science in Nursing program. These 2 strategic steps gave us a comprehensive offering of nursing degree programs, increased our addressable market and added new programs that brought significantly higher lifetime value degrees into our portfolio.

Most recently, our strategy has been to focus our marketing spend on increasing enrollment in our high LTV nursing programs. As demonstrated in the third quarter results, it's clear that our strategy of prioritizing marketing dollars to grow enrollment in high LTV nursing program is working, as evidenced by another quarter of exceptional revenue growth and a 72% increase in bookings.

I'm very pleased that we delivered this level of growth with only a 9% increase in our marketing spend year-over-year. Each marketing dollar spent in the third quarter returned a 15.1x and a 16.2x marketing efficiency ratio in the quarter for Aspen University and United States University, respectively.

This is an extremely efficient business model. Keep in mind that each year, our third quarter enrollment is sequentially lower than the second quarter, which is our strongest back-to-school seasonal enrollment quarter, and that this past Q2 was an extraordinarily strong record enrollment quarter. That said, I'm very pleased with our third quarter enrollment growth of 28% year-over-year to 1,746 new students.

In the third quarter, Aspen University accounted for 1,371 new student enrollments, delivering overall growth of 23% year-over-year, primarily due to a full quarter of enrollments in our pre-licensure BSN programs at both of our Phoenix campuses.

United States University or USU accounted for 375 new student enrollments, primarily due to FNP enrollment growth, for a 49% increase in overall enrollments year-over-year.

As I mentioned earlier, our marketing efficiency ratios also remained very high this quarter. Every dollar we spent in marketing on Aspen University delivered over $15 in revenue. For USU, we received over $16 in revenue for every marketing dollar spent. These results reflect the value of our proprietary EdTech platform and the sophistication of our corporate marketing staff.

In fiscal Q3 2020, bookings meaningfully increased from $15.5 million to $26.5 million, delivering an average revenue per enrollment or ARPU increase of 34% from $11,352 to $15,199. The bookings increase, coupled with low enrollment cost, is the primary driver of the gross margin improvement of 700 basis points year-over-year to 57% in the third quarter.

Internally, our units continue to focus on operational improvements that, combined with lower enrollment costs, resulted in another quarter of positive net income for all 3 of our business units, Aspen University Online, Aspen's pre-licensure BSN and United States University. These results underscore the performance of our EdTech platform in lowering enrollment costs and contributing to the key competitive advantages of lower tuition rates, financial flexibility and better outcomes for our students which, in turn, is powering our growth.

I can't emphasize enough that our EdTech platform is driving value for all our stakeholders. Our students achieve better outcomes, they take down less debt, they enjoyed financial flexibility and tuition payment options. Our business is driving material improvements to our financial performance as evidenced by our adjusted EBITDA margin improved by 15 margin points year-over-year. Our employees report high job satisfaction and increased opportunity for career growth, and our shareholders are seeing improving shareholder value based on our high-performing differentiated business model.

Longer term, our road map is to build out new capacity for our highest LTV degree programs. To fuel our future growth, we strengthened our balance sheet in January with a $16 million equity raise and restructured our debt to lower our interest expense and add the convert feature. Those transactions allowed us to end the quarter with a record $26 million of liquidity.

For the past year, we have successfully demonstrated that we can grow these high LTV programs with an extremely effective marketing spend. Recent financing initiatives will allow us to continue investing in new BSN pre-licensure campuses, which is a potential $100 million revenue opportunity in the next 5 years. We recently announced the locations of our 2 new campuses for our pre-licensure BSN program in Florida and Texas, both of which will be enrolling students later this calendar year.

We intend to have 12 campuses operational by 2024. We also intend to build out exam rooms in each metro location where we have a BSN pre-licensure presence in order to allow for USU's MSN-FNP weekend immersions in each metro, which will be a catalyst for future enrollment growth in its highly sought after degree.

We continue to invest in our future to deliver long-term growth, creating profitability and improvement in cash flow from operations. Given the strong performance in the first 9 months of fiscal year 2020, we now expect annual revenue growth to meet or exceed 42% for the full fiscal year based on anticipated year-over-year enrollment growth of approximately 30%, bookings is forecast to exceed 54% to over $102 million, and we're forecasting ARPU to increase to at least 18% to a full year average over $13,440.

Now I'll turn the call over to Frank to review our financial results for Q3 and to provide an update on our liquidity.

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Frank J. Cotroneo, Aspen Group, Inc. - CFO & Director [3]

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Thank you, Mike, and good afternoon, everyone. I'm going to begin by reviewing our financial results for the 2020 fiscal third quarter and then provide some insight into this quarter's performance and some commentary regarding our expectations for the coming quarters.

Total revenues for the third quarter were $12.5 million, up 48% versus the year ago period. As Mike indicated, our strong revenue growth was driven by new student enrollments, which increased 28% to third quarter record of 1,746. Of total new student enrollment, Aspen University was up 23% and United States University was up 49%. Strong growth in our higher LTV programs drove bookings growth of 72% to $26.5 million.

Aspen University had third quarter enrollments of 1,371, up from 1,112 in the year ago period. Bookings for this business unit was $19.9 million versus $11 million in the year ago period. AU was a significant contributor to our total bookings growth of 72% and is expected to drive continued growth in bookings in the coming years.

USU had Q3 enrollments of 375 students versus 251 in the year ago period, an increase of 49%. USU bookings were $6.7 million this quarter, up from $4.5 million in fiscal or an increase of 49% from the third quarter of 2019.

Aspen Group's gross margins for the third quarter improved to 57%, up from 50% in the prior year period. The 700 basis point year-over-year improvement in gross margins was primarily driven by our marketing expenses only increasing 9% year-over-year. From a unit perspective, Aspen University's gross margin was 58% in the third quarter versus 45% in the prior year period. United States University's gross margin was 60% in the third quarter, up from 45% in the year ago period. This gross margin increase reflects the effects of higher lifetime value programs growing as a percentage of our overall revenue, led by the pre-licensure BSN and the FNP programs. We expect this trend to continue as we roll out our campus strategy in the coming years.

Overall total instructional costs and services for the third quarter were $2.6 million or 21% of revenue versus $1.8 million or 21% as a percentage of revenue a year ago. Instructional costs for Aspen University represented 19% of AU's revenues versus 18% in the year ago period, while instructional costs for USU in the current quarter represented 25% of USU revenue versus 30% in the year ago period.

Total marketing and promotional costs for the third quarter were $2.5 million or 20% of total revenue, an improvement over the prior year period, which was $2.3 million and 27% of total revenue. Marketing and promotional expenses increased approximately $500,000 over the sequential quarter and approximately $200,000 over the same quarter a year ago.

This was an affirmative decision to increase our investment in growing our student pipeline in our doctoral program and pre-licensure and FNP, our 2 highest LTV and fastest-growing programs.

Marketing and promotional costs for Aspen University represented 20% of Aspen University revenues, down from 25% in fiscal third quarter 2019. USU's marketing and promotional costs were 15% of USU's revenues, down from 25% in fiscal third quarter last year.

This performance demonstrates the continued value creation of our EdTech program to enroll more students into higher LTV programs at a lower overall cost, thus increasing the efficiency of our marketing spend and contributing to our trajectory towards sustained profitability and cash flow generation.

General and administrative costs for the quarter were approximately $8.6 million compared to $6.3 million during the comparable prior year quarter, an increase of $2.3 million or 37%. The recurring general and administrative costs for the quarter of $7.8 million increased 26% year-over-year, therefore tracking to our long-term goal that G&A will grow at approximately half the rate of revenue.

Total nonrecurring expense for the current third quarter is $1 million. The nonrecurring costs are composed of $544,000 of CFO transition costs, $283,000 of other G&A, and $182,000 of accelerated amortization of financing costs from previous financing activities. This $1 million is compared to $83,000 for the year ago quarter for other G&A cash items. Of the $1 million of nonrecurring costs, $354,000 are cash and $656,000 are noncash.

From a total company bottom line perspective, the total loss for the third quarter was $2,281,000 compared to a loss of $2,356,000 in the prior year quarter. For this third quarter, excluding the nonrecurring costs previously discussed, the recurring net loss for the third quarter would have been $1.3 million or $0.07 per basic share compared to $2.3 million or $0.12 per basic share in the prior year quarter. Excluding nonrecurring costs, this is an improvement of $1 million or $0.05 per basic share versus the year ago quarter.

From a unit perspective, Aspen University's net income for the quarter was $1.3 million versus $400,000 in the prior year quarter. USU's net income was $40,000 versus a net loss of $900,000 in the fiscal third quarter 2019. Both universities' improved performance reflects strong enrollment growth, fueled by our EdTech platform and its ability to bring students into our higher LTV programs and an increasingly efficient marketing spend per student.

For AGI, excluding nonrecurring items discussed earlier, G&A expenses were $2 million in the quarter versus $1.5 million in the year ago quarter. The year-over-year increase in corporate expenses is primarily due to corporate staff increases in finance, accounting and marketing as well as higher noncash stock comp expense.

With regard to our liquidity position, cash used in operations for the quarter was approximately $1.8 million versus $1.9 million in the year ago period and $300,000 in the prior quarter. Recall last quarter, the company received approximately $500,000 of financial aid funds just days before the end of the quarter, which we didn't benefit from this quarter.

Excluding nonrecurring items in the current quarter, the cash used in operations this quarter was $1.45 million. Therefore, the average cash used in operations for the third quarter and the second quarter, our last 2 quarters, is $900,000, a 47% reduction from the $1.7 million used in the first quarter and approximately a $1 million reduction or a 53% reduction in cash used in operations for the third quarter a year ago. This performance reflects our continued improvement on our path towards positive cash from operations.

Adjusted EBITDA for the quarter was a positive $222,000. This was approximately $450,000 less than originally planned. This reflects our decision to increase our marketing expenditures this quarter by over $500,000 to continue to invest in building our pipeline of students for our higher lifetime value programs, including Doctoral, pre-licensure BSN and Family Nurse Practitioner. We expect to continue our strategy to increase our investment in these programs in the coming quarters.

Aspen Group ended the quarter with approximately $21 million in cash. Together with our unused revolver of $5 million, we ended the quarter with approximately $26 million of liquidity resources. With respect to our share count, the weighted average number of common basic shares outstanding at the end of the quarter was 19,420,987 versus 18,398,095 in the year ago quarter. This increase does not yet reflect the full effect of the shares sold in the equity raise, which closed on January 22, 2020. The company issued 2,415,000 shares and currently has 21,710,408 outstanding shares at January 31, 2020. These shares will have a full effect on EPS in the coming fourth quarter.

That concludes our prepared remarks. I'll now turn the call back to the operator for questions. Thank you very much.

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Questions and Answers

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Operator [1]

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(Operator Instructions) And our first question comes from the line of Darren Aftahi with Roth Capital.

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Darren Aftahi, Roth Capital Partners, LLC, Research Division - MD & Senior Research Analyst [2]

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Congrats on the quarter. Can we talk a little bit about some of your newer campuses on the pre-licensure side? I know when you open the second or about to open the second of Phoenix campus, HonorHealth, to kind of build the pipeline. I'm just kind of curious if that's already occurred. One. And then two, what kind of marketing you're kind of doing at this early stage here? And I've got a couple of follow-ups.

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Michael D. Mathews, Aspen Group, Inc. - Chairman of the Board & CEO [3]

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Yes. Good afternoon, Darren. It's Mike Matthews. I apologize. Are you asking about HonorHealth or are you asking about our next campus opening, which is Tampa?

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Darren Aftahi, Roth Capital Partners, LLC, Research Division - MD & Senior Research Analyst [4]

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I'm actually asking about Tampa and then Austin kind of behind that.

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Michael D. Mathews, Aspen Group, Inc. - Chairman of the Board & CEO [5]

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Okay. Yes. So we are in the middle of the regulatory review process with the regulatory bodies in the State of Florida, both the Department of Education as well as the nursing board. And we expect to -- the final meeting of the board of nursing and Department of Education is in late April, which I plan to attend. And subsequent to that meeting, assuming we receive approval within the following week or 2, we will commence immediately with our marketing program. And so we're looking at -- we're targeting the month of May to begin marketing for our initial semester start, which is the first week of August.

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Darren Aftahi, Roth Capital Partners, LLC, Research Division - MD & Senior Research Analyst [6]

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Great. And then -- and we kind of think about that business and I know it's new, but although we think the Tampa market -- and then follow-up, your cost of enrollment, although I know you've rolled up into kind of all of Aspen on the pre-licensure side, it seems like it's still relatively low. What are kind of your expectations on cost of enrollment in these newer markets? And should we think about those figures potentially being at par, higher or lower? Just trying to get a sense for how we should kind of model this going forward with these new pre-licensure campuses.

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Michael D. Mathews, Aspen Group, Inc. - Chairman of the Board & CEO [7]

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Yes, sure. So we're internally modeling the cost of enrollment to be slightly higher in our new metros, both Tampa as well as Austin. And the simple reason for that is that we have the benefit of our partnership with HonorHealth, where they've been able to deliver to us hundreds of pre-licensure students, both existing employees as well as other folks that they've been able to send to us for a pre-licensure enrollment. So we won't receive that benefit of that great partnership with HonorHealth and the fact that they've been very good about giving us the pipeline of leads. But -- so we're in the $200 to $300 range for the first 1.5 years of the pre-licensure business. And there's no reason to believe that our cost enrollment will be anywhere -- they'll continue to be south of $500, that's what we're modeling.

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Darren Aftahi, Roth Capital Partners, LLC, Research Division - MD & Senior Research Analyst [8]

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That's great. And then I'll just ask because I feel that somebody will. But should the COVID-19 issue kind of manifests itself, what potential kind of impact would that have on your business, if any? And is that going to factor into your next quarter's guidance?

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Michael D. Mathews, Aspen Group, Inc. - Chairman of the Board & CEO [9]

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Yes. So I mean, let me talk a little bit about where we are with that. So first, thankfully, we have a very close relationship with HonorHealth in Phoenix. And we received updates regularly as this is the only metro in which we have an operating campus business today, of course, Phoenix. Our business is less at risk than other universities for 2 reasons: one, our students are all commuters as none of our students live on campus; and number two, we have a small group of students that come in only 3 times per week for a half-day for lectures and clinicals. We absolutely will continue to monitor the situation of Phoenix Metro very closely. And we do have a series of plans in place should there be any effect in our 2 campus locations. And for example, we are looking at the possibility of doing clinical rotations in a telehealth environment as one example. So we have some creative solutions should we have to, at any point in time, look for alternative clinicals for our students.

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Operator [10]

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And our next question comes from the line of Austin Moldow with Canaccord.

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Austin William Moldow, Canaccord Genuity Corp., Research Division - Associate [11]

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Given the modest marketing growth year-over-year, but actually having accelerated that more than you originally thought, what's the current outlook for marketing growth over the next year?

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Michael D. Mathews, Aspen Group, Inc. - Chairman of the Board & CEO [12]

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Yes. Great question, Austin. Good afternoon. Let me just go back and just talk about a couple of quarters ago, as you guys, I'm sure, remember, we were able to deliver enrollment growth in the over 30 percentile enrollments year-over-year, and our marketing spend was an unbelievable minus 11% year-over-year. We can't sustain that kind of enrollment growth, unless we start to significantly increase our marketing spend. So as you saw, this quarter, we made a business decision to grow our marketing spend sequentially by $0.5 million. And as Frank pointed out, that is the difference in terms of our -- your consensus estimate on our EPS relative to what we delivered, excluding nonrecurring costs. We're going to continue to increase our spend rate as the fiscal year -- as this new fiscal year begins. Right now, I would say that we'll probably increase marketing spend on a sequential basis from Q3 to Q4 by another approximately $300,000.

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Austin William Moldow, Canaccord Genuity Corp., Research Division - Associate [13]

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Great. That's really helpful. And shifting to the new campuses. Can you talk about the capacity you have with your pre-licensure, given the amount of students you have in prereqs and the number of clinical seats you expect to be available for them in the near future?

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Michael D. Mathews, Aspen Group, Inc. - Chairman of the Board & CEO [14]

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Yes. So yes, I'll begin with our Phoenix Metro. Back of the envelope, we expect to enroll no more than approximately 1,500 students in any given time in our prereq, our first year prereq phase. From a maturation point of view, our final 2-year core program we currently enroll, on average, 30 students per semester, and of course, we have 6 semesters per year in each of our 2 campuses, so we have 12 semester starts per annum in Phoenix currently. We -- when we hit maturity with each of our campuses, of which, again, we have 2, the maturity will be somewhere in the vicinity of 750 students in each campus in the core program. So over time, we would look to have, in the Phoenix Metro, a total of approximately 1,500 students across both campuses in our core -- 2-year core program. And again, we would probably have no more than around 1,500 on an aggregate basis that basically creates the waterfall for those 30 per semester.

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Operator [15]

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Our next question comes from the line of Eric Martinuzzi with Lake Street.

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Eric Martinuzzi, Lake Street Capital Markets, LLC, Research Division - Head of Research & Senior Research Analyst [16]

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I was wondering why the Aspen University side, why the ARPU declined sequentially?

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Michael D. Mathews, Aspen Group, Inc. - Chairman of the Board & CEO [17]

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Good afternoon, Eric. What is this? I'd have to pull the ARPU. What was the ARPU from last quarter for Aspen University? I don't believe we presented it that way. This is the first quarter that we've presented the ARPU for Aspen University because we collapsed each of the 3 units together. So I don't think there is a comparative. I don't know where you would get a comparative.

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Eric Martinuzzi, Lake Street Capital Markets, LLC, Research Division - Head of Research & Senior Research Analyst [18]

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I'm just looking at the press release from last quarter, the Q2 breakout. You've got, essentially, if you take the bookings number and you back off USU, you come up with the $24.3 million of bookings and then sum up the -- whatever.

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Michael D. Mathews, Aspen Group, Inc. - Chairman of the Board & CEO [19]

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I mean, the simple math would tell you that because the enrollments were significantly higher last quarter, and if the enrollments were primary -- there's a strong weighting towards the pre-licensure program, which is the highest LTV of $30,000 per student, then that would dictate a higher ARPU. I don't have numbers in front of me, but that would be your answer.

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Eric Martinuzzi, Lake Street Capital Markets, LLC, Research Division - Head of Research & Senior Research Analyst [20]

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Okay. Well, let me reask the question. The -- it would seem then that we had the enrollment growth skewed towards the legacy BSN completion program. Is there a seasonal element that will explain that?

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Michael D. Mathews, Aspen Group, Inc. - Chairman of the Board & CEO [21]

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Yes. No, exactly, exactly. So the 2 variables that would equal the ARPU formula quarter-over-quarter would be much higher enrollments overall in the previous quarter and a higher percentage of pre-licensure in that second quarter. So those 2 factors would alter the ARPU. So yes, you're correct.

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Eric Martinuzzi, Lake Street Capital Markets, LLC, Research Division - Head of Research & Senior Research Analyst [22]

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Right. You just explained the question I asked. I'm asking you to explain why that was the case because we've had...

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Michael D. Mathews, Aspen Group, Inc. - Chairman of the Board & CEO [23]

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I did give you the answer. The answer is that we had a higher percentage of pre-licensure students in terms of the total enrollments in Q2 versus Q3, that's what affected the difference in the ARPU. That's the answer.

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Eric Martinuzzi, Lake Street Capital Markets, LLC, Research Division - Head of Research & Senior Research Analyst [24]

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Okay. Why did we choose to amp up the marketing mid-quarter? In other words, as you gave guidance last quarter, it wasn't on the table. And then mid-quarter, you changed your mind.

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Michael D. Mathews, Aspen Group, Inc. - Chairman of the Board & CEO [25]

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Well, I mean, we are on the doorstep of, obviously, looking at doing an equity raise, and we are pretty confident we were going to be able to get that done. And we felt like we've had a year's worth of flat marketing spending, and it was about time that we started to get more aggressive. I think if you look at our marketing efficiency ratio versus any other company in our space or, frankly, in the business-to-consumer sector in total, we probably have one of the best ratios that exist. So we're not doing our shareholders justice if we don't start to significantly increase our marketing spend.

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Eric Martinuzzi, Lake Street Capital Markets, LLC, Research Division - Head of Research & Senior Research Analyst [26]

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Okay. And then as far as the profit outlook for the fourth quarter, what's the expectation from an adjusted EBITDA perspective?

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Michael D. Mathews, Aspen Group, Inc. - Chairman of the Board & CEO [27]

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Well, the only guidance we provided today is we expect the top line to meet or exceed 42% for the fiscal year. We're not providing any bottom line guidance at this time. I know we have said previously publicly that the company expects to remain adjusted EBITDA positive, and I would reiterate that point.

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Operator [28]

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And our next question comes from the line of Mike Malouf with Craig-Hallum.

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Michael Fawzy Malouf, Craig-Hallum Capital Group LLC, Research Division - Partner, Senior Research Analyst & Head of Boston Team [29]

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Well done on the quarter. If I could focus just a little bit more on the coronavirus. A couple of questions. I know you talked very helpful with regards to what's going on in Phoenix. What about with San Diego? What kind of impact would that have on the USU side?

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Michael D. Mathews, Aspen Group, Inc. - Chairman of the Board & CEO [30]

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Yes. I mean, it's really the same situation. The only times that we have students in the campus would be when we implement our weekend immersions. And so if something happens in San Diego that would cause us to have to alter our plan, we would also look at some telehealth approaches in order to -- from a clinical perspective. And so for example, we did get 5 students at USU in the last 48 hours that have advised us that they can't do their clinical, their FNP clinicals, and we're working very diligently to look at some telehealth alternatives for them during this interim time frame. So again, we do have alternatives as to how to handle our clinicals. And again, weekend emersion is something that we could always move them to Phoenix or another metro if necessary for weekend immersions.

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Michael Fawzy Malouf, Craig-Hallum Capital Group LLC, Research Division - Partner, Senior Research Analyst & Head of Boston Team [31]

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Okay, great. And then when you're expanding the USU program because of the other campuses, can you give us a sense of timing that will allow you to expand the clinical immersion program to these other campuses? What...

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Michael D. Mathews, Aspen Group, Inc. - Chairman of the Board & CEO [32]

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Yes. Great question. Okay. Yes. So yes, Mike, what we're planning to do is we're going to make -- actually our Phoenix Metro is going to be our first location, where we're going to be able to do weekend immersions outside of San Diego. We are in the final stages of completing a lease within our current campus footprint in one of our buildings on the ground floor. We're looking to lease approximately 5,000 square feet to implement FNP immersions in our Phoenix campus. And we're looking to have that available by midyear. Secondly, we'll be ready to implement weekend immersions in Tampa as early as the first week of August when we launch our pre-licensure program. And then as you're probably aware, Austin is more like November in terms of when the campus is going to be available.

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Michael Fawzy Malouf, Craig-Hallum Capital Group LLC, Research Division - Partner, Senior Research Analyst & Head of Boston Team [33]

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Got it. Okay. Great. And then just a final question. When you're talking about the pre-licensure program, 1,500 students at maturity, what would roughly be the weighted average of your revenue per your student at that point?

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Michael D. Mathews, Aspen Group, Inc. - Chairman of the Board & CEO [34]

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Well, we publicly said that our weighted average LTV per student is about $30,000. And that assumes that if we have 1,500 pre-licensure students that matriculated a rate of, say, 65%, combined with our core students that we're currently forecasting to graduate in the 90 to 93 percentile range, that's how you back into that sort of $30,000 LTV number.

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Operator [35]

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(Operator Instructions) Our next question comes from the line of Mike Grondahl with Northland Securities.

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Michael John Grondahl, Northland Capital Markets, Research Division - Head of Equity Research & Senior Research Analyst [36]

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Just on the Aspen Doctoral program or the USU FNP program, anything new there to kind of call out or update us on?

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Michael D. Mathews, Aspen Group, Inc. - Chairman of the Board & CEO [37]

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Well, the Aspen Doctoral program is growing very nicely. We -- our enrollments are up year-over-year by approximately 50%. We've recently increased the call center for our Doctoral group from -- we previously had 8 or 9 people, and we're now at 15, and we're expecting to grow over the next couple of quarters, close to 20 people. So yes, so we expect that to be -- to continue to grow quite rapidly.

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Michael John Grondahl, Northland Capital Markets, Research Division - Head of Equity Research & Senior Research Analyst [38]

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Got it. And did you guys call out how many enrollment advisers you had at the end of the January quarter?

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Michael D. Mathews, Aspen Group, Inc. - Chairman of the Board & CEO [39]

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We did not. But we're in the -- about 100-person range at this point, approximately. And that [is in respect to] both universities.

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Operator [40]

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And I'm showing no further questions at this time. So with that, I'll turn the call back over to Chairman and CEO, Michael Matthews, for any further remarks.

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Michael D. Mathews, Aspen Group, Inc. - Chairman of the Board & CEO [41]

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Thank you, everyone, for joining our third quarter fiscal call today and looking forward to talking to you in a couple of months when we do our fourth quarter year-end call. Good afternoon.

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Operator [42]

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Ladies and gentlemen, thank you for participating in today's conference. This does conclude the program, and you may now disconnect.