Gaia Reports Third Quarter 2021 Results
Revenues up 17% with 20% EBITDA Margin
BOULDER, Colo., Nov. 01, 2021 (GLOBE NEWSWIRE) -- Gaia, Inc. (NASDAQ: GAIA), a conscious media and community company, reported financial results for the third quarter ended September 30, 2021.
Highlights
- 22% revenue growth year to date
- Q3 EBITDA of $4.0 million, with EBITDA margin of 20%
- Fifth straight quarter of positive earnings and cash flow
“The third quarter of 2021 marks another quarter of disciplined execution against our plan to generate net income and cash flows while driving revenue and member growth,” said Paul Tarell, Gaia’s CFO. “Now that we are consistently generating positive net income and cash flows from operations, we are focused on growing both average revenue per member and the overall member base. Early traction in our efforts to promote our $299 premium subscription tier to current and prospective members has been promising.”
Third Quarter 2021 Financial Results
Revenues increased 17% to $20.4 million from $17.5 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 790,500 as of September 30, 2021.
Gross profit in the third quarter increased to $17.8 million compared to $15.3 million in the year-ago quarter. Gross margin was flat at 87.1%.
Total operating expenses were $17.1 million or 84% of revenues compared to $14.9 million or 85% of revenues in the year-ago quarter. This reflects the stabilization of Gaia’s cost structure since turning profitable in the third quarter of 2020. EBITDA improved to $4.0 million, reflecting an EBITDA margin of 20%.
Net income increased to $0.6 million or $0.03 per share compared to $0.2 million or $0.01 per share in the year ago quarter, excluding the $6.1 million gain on the sale of a portion of Gaia’s corporate campus in September 2020. Including the gain, net income in the third quarter of 2020 was $6.3 million or $0.32 per share.
Cash flows from operations improved 55% to $5.1 million from $3.3 million in the year-ago quarter. Gaia’s cash balance as of September 30, 2021, was $14.4 million, an increase of $1.8 million since December 31, 2020.
Year to Date 2021 Financial Results
Revenues for the nine months ended September 30, 2021 increased 22% to $58.7 million from $48.2 million.
Gross profit for the nine months ended September 30, 2021 increased to $51.2 million compared to $42.0 million. Gross margin improved 10 basis points to 87.1%.
Total operating expenses were $49.3 million or 84% of revenues for the nine months ended September 30, 2021 compared to $47.1 million or 98% of revenues in the prior period. EBITDA improved to $11.5 million, which reflects a 72% flow through of the incremental revenues generated in the current period compared to the prior period.
Net income increased to $1.6 million or $0.08 per share for the nine months ended September 30, 2021 compared to $0.2 million or $0.01 per share in the prior period.
Cash flows from operations improved 103% to $14.5 million during the nine months ended September 30, 2021 compared to $7.2 million in the prior period.
Conference Call
Date: Monday, November 1, 2021
Time: 4:30 p.m. Eastern time (2:30 p.m. Mountain time)
Toll-free dial-in number: 1-866-248-8441
International dial-in number: 1-323-289-6576
Conference ID: 6551369
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 November 15, 2021.
Toll-free replay number: 1-844-512-2921
International replay number: 1-412-317-6671
Replay ID: 6551369
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 September 30, | For the Nine Months Ended September 30, | |||||||||||||||
| (in thousands, except per share data) | 2021 | 2020 | 2021 | 2020 | ||||||||||||
| (unaudited) | (unaudited) | |||||||||||||||
| Revenues, net | $ | 20,405 | $ | 17,537 | $ | 58,744 | $ | 48,201 | ||||||||
| Cost of revenues | 2,626 | 2,264 | 7,573 | 6,248 | ||||||||||||
| Gross profit | 17,779 | 15,273 | 51,171 | 41,953 | ||||||||||||
| Gross profit margin | 87.1 | % | 87.1 | % | 87.1 | % | 87.0 | % | ||||||||
| Expenses: | ||||||||||||||||
| Selling and operating | 15,544 | 13,479 | 44,820 | 42,354 | ||||||||||||
| Corporate, general and administration | 1,509 | 1,426 | 4,506 | 4,716 | ||||||||||||
| Total operating expenses | 17,053 | 14,905 | 49,326 | 47,070 | ||||||||||||
| Income (loss) from operations | 726 | 368 | 1,845 | (5,117 | ) | |||||||||||
| Interest and other income (expense), net | (79 | ) | 5,946 | (197 | ) | 5,395 | ||||||||||
| Income before income taxes | 647 | 6,314 | 1,648 | 278 | ||||||||||||
| Provision for income taxes | — | — | — | 69 | ||||||||||||
| Net income | $ | 647 | $ | 6,314 | $ | 1,648 | $ | 209 | ||||||||
| Earnings per share: | ||||||||||||||||
| Basic | $ | 0.03 | $ | 0.33 | $ | 0.09 | $ | 0.01 | ||||||||
| Diluted | $ | 0.03 | $ | 0.32 | $ | 0.08 | $ | 0.01 | ||||||||
| Weighted-average shares outstanding: | ||||||||||||||||
| Basic | 19,318 | 19,183 | 19,262 | 18,834 | ||||||||||||
| Diluted | 19,812 | 19,737 | 19,787 | 19,442 | ||||||||||||
| EBITDA* | $ | 4,036 | $ | 3,372 | $ | 11,486 | $ | 3,909 | ||||||||
* See definition and reconciliation below.
GAIA, INC.
Summary of Cash Flows
| For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||||
| (in thousands) | 2021 | 2020 | 2021 | 2020 | ||||||||||||
| (unaudited) | (unaudited) | |||||||||||||||
| Net cash provided by (used in): | ||||||||||||||||
| Operating activities | $ | 5,146 | $ | 3,333 | $ | 14,586 | $ | 7,197 | ||||||||
| Investing activities | (4,376 | ) | 9,862 | (13,355 | ) | 2,781 | ||||||||||
| Financing activities | (81 | ) | (12,932 | ) | 592 | (12,751 | ) | |||||||||
| Net change in cash | $ | 689 | $ | 263 | $ | 1,823 | $ | (2,773 | ) | |||||||
Reconciliation of Net Income to EBITDA and Adjusted EBITDA
| For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||||
| (in thousands) | 2021 | 2020 | 2021 | 2020 | ||||||||||||
| (unaudited) | (unaudited) | |||||||||||||||
| Net income | $ | 647 | $ | 6,314 | $ | 1,648 | $ | 209 | ||||||||
| Interest expense, net | 79 | 179 | 197 | 730 | ||||||||||||
| Provision for income taxes | — | — | — | 69 | ||||||||||||
| Gain on sale of real estate | — | (6,125 | ) | — | (6,125 | ) | ||||||||||
| Depreciation and amortization expense | 3,310 | 3,004 | 9,641 | 9,026 | ||||||||||||
| EBITDA | 4,036 | 3,372 | 11,486 | 3,909 | ||||||||||||
| Share-based compensation expense | 533 | 336 | 1,236 | 1,864 | ||||||||||||
| Adjusted EBITDA | $ | 4,569 | $ | 3,708 | $ | 12,722 | $ | 5,773 | ||||||||
EBITDA represents net income 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 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
| September 30, | December 31, | |||||||
| (in thousands, except share and per share data) | 2021 | 2020 | ||||||
| (unaudited) | ||||||||
| ASSETS | ||||||||
| Current assets: | ||||||||
| Cash | $ | 14,428 | $ | 12,605 | ||||
| Accounts receivable | 2,589 | 2,024 | ||||||
| Prepaid expenses and other current assets | 1,863 | 1,746 | ||||||
| Total current assets | 18,880 | 16,375 | ||||||
| Media library, software and equipment, net | 42,246 | 39,231 | ||||||
| Right-of-use lease asset, net | 8,061 | 8,622 | ||||||
| Real estate, investment, and other assets, net | 29,199 | 28,500 | ||||||
| Goodwill | 17,289 | 17,289 | ||||||
| Total assets | $ | 115,675 | $ | 110,017 | ||||
| LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||
| Current liabilities: | ||||||||
| Accounts payable, accrued and other liabilities | $ | 9,855 | $ | 8,947 | ||||
| Deferred revenue | 14,130 | 12,376 | ||||||
| Total current liabilities | 23,985 | 21,323 | ||||||
| Long-term mortgage, net | 6,146 | 6,250 | ||||||
| Long-term lease liability | 7,416 | 7,952 | ||||||
| Deferred taxes | 257 | 257 | ||||||
| Total liabilities | 37,804 | 35,782 | ||||||
| Total shareholders' equity | 77,871 | 74,235 | ||||||
| Total liabilities and shareholders' equity | $ | 115,675 | $ | 110,017 | ||||
Released November 1, 2021