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GAIA Gaia

Filed: 5 May 21, 4:15pm

Exhibit 99.1

 

Gaia Reports First Quarter 2020 Results

Positive Adjusted EBITDA and Cash Flow from Operations

BOULDER, CO, April 27, 2020 — Gaia, Inc. (NASDAQ: GAIA), a conscious media and community company, reported financial results for the first quarter ended March 31, 2020.

First Quarter 2020 Highlights vs. Same Year-Ago Quarter

 

16% increase in revenues to $14.5 million.

 

Generated positive Adjusted EBITDA, an improvement of $4.1 million.

 

Generated $2.0 million in cash flow from operations, an improvement of $4.7 million.

 

“For the second quarter in a row, we generated positive Adjusted EBITDA and cash flow from operations,” said Paul Tarell, Gaia’s CFO. “We remain on track to be free cash flow positive beginning in July, which has been further supported by an uptick in new member growth as a result of the stay-at-home orders that began in mid-March and have continued through April.”

First Quarter 2020 Financial Results

Revenues in the first quarter increased 16% to $14.5 million from $12.5 million in the year-ago quarter. This was primarily due to growth in paying members and an increase in average revenue per member. Paying members increased to 605,100 as of March 31, 2020, which includes the impact of finalizing and implementing price increases in the first quarter. As of April 27th, Gaia has surpassed 625,000 paying members.

Gross profit in the first quarter increased 16% to $12.6 million compared to $10.9 million in the year-ago quarter. Gross margin declined slightly to 86.9% versus 87.2% in the year-ago quarter primarily due to increased amortization for content released in 2019 but was unchanged from the fourth quarter of 2019.

Total operating expenses in the first quarter declined 8% to $15.9 million from $17.3 million in the year-ago quarter, primarily due to reductions in marketing spend. Customer acquisition costs as a percentage of revenue decreased to 52% in the first quarter of 2020 from 69% in the year-ago quarter.

Net loss in the first quarter improved significantly to $3.6 million, or $(0.19) per share, compared to a net loss of $6.7 million, or $(0.38) per share, in the year-ago quarter.

Adjusted EBITDA also improved significantly to $0.2 million compared to $(3.9) million in the year-ago quarter.

Gaia generated cash from operations of $2.0 million in the first quarter of 2020 compared to cash used of $2.7 million in the year ago quarter, an improvement of $4.7 million.

Gaia’s cash conversion cycle has continued to improve, with overall cash used during the quarter of $1.5 million compared to a use of $7.7 million in the year ago quarter.

As of March 31, 2020, Gaia had $10.0 million in cash compared to $11.5 million as of December 31, 2019.


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Conference Call

The company will hold a conference call today at 4:30 p.m. Eastern time to discuss its first quarter 2020 results.

Date: Monday, April 27, 2020

Time: 4:30 p.m. Eastern time (2:30 p.m. Mountain time)

Toll-free dial-in number: (855) 327-6837

International dial-in number: (631) 891-4304

Conference ID: 10009485

 

Please call the conference telephone number five 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 the investor relations section of the Company’s website at www.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 May 11, 2020.

 

Toll-free replay number: (844) 512-2921

International replay number: (412) 317-6671

Replay ID: 9392365

About Gaia

Gaia is a global video streaming service and community that provides curated conscious media in four primary channels—Seeking Truth, Transformation, Alternative Healing and Yoga—to its subscribers in 185 countries with approximately 8,000 titles. Over 90% of its library is exclusive to Gaia, and approximately 80% of the views are generated by content produced or owned by Gaia. For more information about Gaia, visit www.gaia.com.

Forward-Looking Statements

This press release includes forward-looking statements relating to matters that are not historical facts. Forward-looking statements may be identified by the use of words such as “expect,” “believe,” “will,” or comparable terminology or by discussions of strategy. While Gaia believes its assumptions and expectations underlying forward-looking statements are reasonable, there can be no assurance that actual results will not be materially different. Risks and uncertainties that could cause materially different results include, among others, operating losses, general economic conditions, competition, changing consumer preferences, acquisitions, new initiatives we undertake, costs of acquiring new subscribers, subscriber retention rates, and other risks and uncertainties included in Gaia’s filings with the Securities and Exchange Commission. Gaia assumes no duty to update any forward-looking statements.


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Contacts

Paul Tarell

Gaia, Inc.

(303) 222-3330

Paul.Tarell@gaia.com

 

Cody Slach

Gateway Investor Relations

(949) 574-3860

GAIA@gatewayir.com

 


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GAIA, INC.

Condensed Consolidated Statements of Operations

 

 

For the Three Months Ended March 31,

 

(in thousands, except per share data)

 

2020

 

 

2019

 

 

 

(unaudited)

 

Revenues, net

 

$

14,511

 

 

$

12,467

 

Cost of revenues

 

 

1,901

 

 

 

1,600

 

Gross profit

 

 

12,610

 

 

 

10,867

 

Expenses:

 

 

 

 

 

 

 

 

Selling and operating

 

 

14,458

 

 

 

15,722

 

Corporate, general and administration

 

 

1,417

 

 

 

1,593

 

Total operating expenses

 

 

15,875

 

 

 

17,315

 

Loss from operations

 

 

(3,265

)

 

 

(6,448

)

Interest and other income (expense), net

 

 

(246

)

 

 

37

 

Loss before income taxes

 

 

(3,511

)

 

 

(6,411

)

Income tax expense

 

 

69

 

 

 

 

Loss from continuing operations

 

 

(3,580

)

 

 

(6,411

)

Loss from discontinued operations

 

 

 

 

 

(315

)

Net loss

 

$

(3,580

)

 

$

(6,726

)

Loss per share-basic and diluted:

 

 

 

 

 

 

 

 

Continuing operations

 

$

(0.19

)

 

$

(0.36

)

Discontinued operations

 

 

-

 

 

 

(0.02

)

Basic and diluted net loss per share

 

$

(0.19

)

 

$

(0.38

)

Weighted-average shares outstanding:

 

 

 

 

 

 

 

 

Basic and diluted

 

 

18,482

 

 

 

17,890

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA*

 

$

169

 

 

$

(3,949

)

 

* See definition and reconciliation on following page.

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GAIA, INC.

Summary of Cash Flows

 

 

For the Three Months Ended March 31,

 

(in thousands)

 

2020

 

 

2019

 

 

 

(unaudited)

 

Net cash provided by (used in):

 

 

 

 

 

 

 

 

Operating activities - continuing operations

 

$

2,006

 

 

$

(2,760

)

Operating activities - discontinued operations

 

 

 

 

 

19

 

Operating activities

 

 

2,006

 

 

 

(2,741

)

Investing activities

 

 

(3,601

)

 

 

(4,924

)

Financing activities

 

 

120

 

 

 

 

Net change in cash

 

$

(1,475

)

 

$

(7,665

)

Reconciliation of Loss from Continuing Operations to EBITDA and Adjusted EBITDA

 

 

For the Three Months Ended March 31,

 

(in thousands)

 

2020

 

 

2019

 

 

 

(unaudited)

 

Loss from continuing operations

 

$

(3,580

)

 

$

(6,726

)

Interest expense (income), net

 

 

246

 

 

 

(37

)

Provision for (benefit from) income taxes

 

 

69

 

 

 

 

Depreciation and amortization expense

 

 

2,969

 

 

 

2,220

 

EBITDA

 

 

(296

)

 

 

(4,543

)

Share-based compensation expense

 

 

465

 

 

 

594

 

Adjusted EBITDA

 

$

169

 

 

$

(3,949

)

EBITDA represents net loss before interest expense, provision for income taxes, 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.

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GAIA, INC.

Condensed Consolidated Balance Sheets

 

 

March 31,

 

 

December 31,

 

(in thousands, except share and per share data)

 

2020

 

 

2019

 

 

 

(unaudited)

 

 

 

 

 

ASSETS

 

 

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

 

 

Cash

 

$

10,019

 

 

$

11,494

 

Accounts receivable

 

 

1,944

 

 

 

2,310

 

Prepaid expenses and other current assets

 

 

2,046

 

 

 

2,443

 

Total current assets

 

 

14,009

 

 

 

16,247

 

Building and land, net

 

 

22,493

 

 

 

22,681

 

Media library, software and equipment, net

 

 

37,924

 

 

 

36,921

 

Goodwill

 

 

17,289

 

 

 

17,289

 

Investments and other assets

 

 

13,148

 

 

 

13,034

 

Total assets

 

$

104,863

 

 

$

106,172

 

LIABILITIES AND EQUITY

 

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

 

 

Accounts payable, accrued and other liabilities

 

$

11,274

 

 

$

10,594

 

Deferred revenue

 

 

10,677

 

 

 

8,025

 

Total current liabilities

 

 

21,951

 

 

 

18,619

 

Long-term debt

 

 

16,717

 

 

 

18,433

 

Deferred taxes

 

 

276

 

 

 

206

 

Total liabilities

 

 

38,944

 

 

 

37,258

 

Total equity

 

 

65,919

 

 

 

68,914

 

Total liabilities and equity

 

$

104,863

 

 

$

106,172

 

 

 

 

 

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