GlobeNewswire Inc | Aug 2, 2021 04:05PM EDT

August 02, 2021

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, Gaias 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%. Gaias 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, 2021Time: 4:30 p.m. Eastern time (2:30 p.m. Mountain time)Toll-free dial-in number: 1-800-437-2398International dial-in number: 1-323-289-6576Conference 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: 1-844-512-2921International replay number: 1-412-317-6671Replay ID: 2686835

About Gaia

Gaia is a member-supported global video streaming service and community that produces and curates conscious media through four primary channelsSeeking Truth, Transformation, Alternative Healing and Yogato its members in 185 countries. Gaias 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 TarellChief Financial OfficerGaia, Inc.Investors@gaia.com

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

GAIA, INC.Condensed Consolidated Statements of Operations

For the Three Months For the Six Months Ended Ended June30, June30,(in thousands, except per 2021 2020 2021 2020 share data) (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 1,501 1,873 2,997 3,290 administrationTotal operating expenses 16,239 16,290 32,273 32,165 Income (loss) from 695 (2,220 ) 1,119 (5,485 )operationsInterest and other expense, (52 ) (305 ) (118 ) (551 )netIncome (loss) before income 643 (2,525 ) 1,001 (6,036 )taxesProvision 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 For the Six Months Ended June30, Ended June30,(in thousands) 2021 2020 2021 2020 (unaudited) (unaudited) Net cashprovided by (used in):Operating $ 4,252 $ 1,858 $ 9,440 $ 3,864 activitiesInvesting (4,205 ) (3,480 ) (8,979 ) (7,081 )activitiesFinancing 647 61 673 181 activitiesNet change in $ 694 $ (1,561 ) $ 1,134 $ (3,036 )cash

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

For the Three Months For the Six Months Ended June30, Ended June30,(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 3,232 3,053 6,331 6,022 expenseEBITDA 3,927 833 7,450 537 Share-based compensation 90 1,063 703 1,528 expenseAdjusted 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

June30, December31, (in thousands, except share and per share 2021 2020 data) (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, 29,317 28,500 netGoodwill 17,289 17,289 Total assets $ 114,144 $ 110,017 LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Accounts payable, accrued and other $ 8,695 $ 8,947 liabilitiesDeferred 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