Press Releases

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  

 


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Source: Gaia, Inc.