Chronicle Journal: Finance

Gaia Reports Second Quarter 2021 Results

BOULDER, Colo., Aug. 02, 2021 (GLOBE NEWSWIRE) -- Gaia, Inc. (NASDAQ: GAIA), a conscious media and community company, reported financial results for the second quarter ended June 30, 2021.

Highlights

  • 20% increase in revenues from the year-ago quarter
  • Fourth sequential quarter of positive earnings and cash flow
  • Improved EBITDA margin to 20%

“The second quarter of 2021 represented another solid quarter of execution on our plan to generate net income and cash flows while driving revenue and member growth,” said Paul Tarell, Gaia’s CFO. “We are looking forward to the second half of the year, when our event lineup at GaiaSphere will be in full swing, which will allow us to promote our $299 premium subscription tier to current and prospective members.”

Second Quarter 2021 Financial Results

Revenues in the second quarter increased 20% to $19.4 million from $16.2 million in the year-ago quarter. This was primarily due to growth in members and an increase in average revenue per member. Paying members increased to 770,200 as of June 30, 2021.

Gross profit in the second quarter increased 20% to $16.9 million compared to $14.1 million in the year-ago quarter. Gross margin was flat at 87.1%.

Total operating expenses improved to $16.2 million, or 84% of revenues in the second quarter of 2021, compared to $16.3 million, or 101% of revenues, in the year-ago quarter. The significant reduction as a percentage of revenues is due to continued efficiency improvements in fixed operating expenses and the reduction of customer acquisition costs as a percentage of revenue to 40% from 52% in the year-ago quarter.

Net income improved by $3.1 million in the second quarter to $0.6 million or $0.03 per share, from a net loss of $2.5 million or $(0.13) per share in the year ago quarter. As a percentage of revenues, this represents an 18% improvement between periods.

EBITDA improved to $3.9 million, or 20% of revenues, compared to $0.8 million, or 5% of revenues in the year-ago quarter.

Cash flows from operations improved to $4.3 million during the second quarter of 2021 from $1.9 million in the year-ago quarter, an improvement of 126%. Gaia’s cash balance as of June 30, 2021 was $13.7 million, an increase of $1.1 million since December 31, 2020.

Conference Call

Date: Monday, August 2, 2021
Time: 4:30 p.m. Eastern time (2:30 p.m. Mountain time)
Toll-free dial-in number: 1-800-437-2398
International dial-in number: 1-323-289-6576
Conference ID: 2686835

Please call the conference telephone number 5-10 minutes prior to the start time. An operator will register your name and organization. If you have any difficulty connecting with the conference call, please contact Gateway Investor Relations at (949) 574-3860.

The conference call will be broadcast live and available for replay here and via ir.gaia.com.

A telephonic replay of the conference call will be available after 7:30 p.m. Eastern time on the same day through August 16, 2021.

Toll-free replay number: 1-844-512-2921
International replay number: 1-412-317-6671
Replay ID: 2686835

About Gaia

Gaia is a member-supported global video streaming service and community that produces and curates conscious media through four primary channels—Seeking Truth, Transformation, Alternative Healing and Yoga—to its members in 185 countries. Gaia’s library includes approximately 8,000 titles, over 80% of which is exclusive to Gaia, and approximately 80% of the views are generated by content produced or owned by Gaia. Gaia is available on Apple TV, iOS, Android, Roku, Chromecast, and sold through Amazon Prime Video and Comcast Xfinity. For more information about Gaia, visit www.gaia.com.

Company Contact:
Paul Tarell
Chief Financial Officer
Gaia, Inc.
Investors@gaia.com

Investor Relations:
Gateway Investor Relations
Cody Slach
(949) 574-3860
GAIA@gatewayir.com


GAIA, INC.
Condensed Consolidated Statements of Operations

  For the Three Months Ended
June 30,
  For the Six Months Ended
June 30,
 
(in thousands, except per share data) 2021  2020  2021  2020 
  (unaudited)  (unaudited) 
Revenues, net $19,443  $16,153  $38,339  $30,664 
Cost of revenues  2,509   2,083   4,947   3,984 
Gross profit  16,934   14,070   33,392   26,680 
Gross profit margin  87.1%  87.1%  87.1%  87.0%
Expenses:                
Selling and operating  14,738   14,417   29,276   28,875 
Corporate, general and administration  1,501   1,873   2,997   3,290 
Total operating expenses  16,239   16,290   32,273   32,165 
Income (loss) from operations  695   (2,220)  1,119   (5,485)
Interest and other expense, net  (52)  (305)  (118)  (551)
Income (loss) before income taxes  643   (2,525)  1,001   (6,036)
Provision for income taxes           69 
Net income (loss) $643  $(2,525) $1,001  $(6,105)
                 
Earnings per share:                
Basic $0.03  $(0.13) $0.05  $(0.33)
Diluted $0.03  $(0.13) $0.05  $(0.33)
Weighted-average shares outstanding:                
Basic  19,268   18,837   19,235   18,660 
Diluted  19,810   18,837   19,786   18,660 
                 
EBITDA* $3,927  $833  $7,450  $537 

* See definition and reconciliation below.

GAIA, INC.
Summary of Cash Flows

  For the Three Months
Ended June 30,
  For the Six Months
Ended June 30,
 
(in thousands) 2021  2020  2021  2020 
  (unaudited)  (unaudited) 
Net cash provided by (used in):                
Operating activities $4,252  $1,858  $9,440  $3,864 
Investing activities  (4,205)  (3,480)  (8,979)  (7,081)
Financing activities  647   61   673   181 
Net change in cash $694  $(1,561) $1,134  $(3,036)


Reconciliation of Net Income (Loss) to EBITDA and Adjusted EBITDA

  For the Three Months
Ended June 30,
  For the Six Months
Ended June 30,
 
(in thousands) 2021  2020  2021  2020 
  (unaudited)  (unaudited) 
Net income (loss) $643  $(2,525) $1,001  $(6,105)
Interest expense, net  52   305   118   551 
Provision for income taxes           69 
Depreciation and amortization expense  3,232   3,053   6,331   6,022 
EBITDA  3,927   833   7,450   537 
Share-based compensation expense  90   1,063   703   1,528 
Adjusted EBITDA $4,017  $1,896  $8,153  $2,065 

EBITDA represents net income (loss) before interest expense, provision for income taxes, other income, depreciation and amortization. Adjusted EBITDA is defined as EBITDA further adjusted to remove share-based compensation expense. EBITDA and Adjusted EBITDA do not represent net income, as that term is defined under GAAP, and should not be considered as an alternative to net income (loss) as an indicator of our operating performance.

Additionally, EBITDA and Adjusted EBITDA are not intended to be measures of free cash flow available for management or discretionary use as such measures do not consider certain cash requirements such as capital expenditures, tax payments and debt service requirements. EBITDA and Adjusted EBITDA as presented herein are not necessarily comparable to similarly titled measures.


GAIA, INC.
Condensed Consolidated Balance Sheets

  June 30,  December 31, 
(in thousands, except share and per share data) 2021  2020 
  (unaudited)     
ASSETS        
Current assets:        
Cash $13,739  $12,605 
Accounts receivable  2,828   2,024 
Prepaid expenses and other current assets  1,659   1,746 
Total current assets  18,226   16,375 
Media library, software and equipment, net  41,062   39,231 
Right-of-use lease asset, net  8,250   8,622 
Real estate, investment, and other assets, net  29,317   28,500 
Goodwill  17,289   17,289 
Total assets $114,144  $110,017 
LIABILITIES AND SHAREHOLDERS' EQUITY        
Current liabilities:        
Accounts payable, accrued and other liabilities $8,695  $8,947 
Deferred revenue  14,724   12,376 
Total current liabilities  23,419   21,323 
Long-term mortgage, net  6,181   6,250 
Long-term lease liability  7,596   7,952 
Deferred taxes  257   257 
Total liabilities  37,453   35,782 
Total shareholders' equity  76,691   74,235 
Total liabilities and shareholders' equity $114,144  $110,017 

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