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Gaiam Inc. Reports Operating Results (10-Q)

August 09, 2010 | About:

10qk

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Gaiam Inc. (GAIA) filed Quarterly Report for the period ended 2010-06-30.

Gaiam Inc. has a market cap of $125.4 million; its shares were traded at around $5.41 with a P/E ratio of 33.81 and P/S ratio of 0.45. The dividend yield of Gaiam Inc. stocks is 2.77%.GAIA is in the portfolios of Columbia Wanger of Columbia Wanger Asset Management, Jim Simons of Renaissance Technologies LLC.

Highlight of Business Operations:

Net revenue. Net revenue decreased $4.0 million, or 6.7%, to $56.4 million during the second quarter of 2010 from $60.5 million during the second quarter of 2009. Net revenue in our business segment decreased $2.9 million, or 13.8%, to $17.9 million during the second quarter of 2010 from $20.7 million during the second quarter of 2009, primarily reflecting a modest weakening in the consumer environment and the timing of some orders from retailers, partially offset by increased store within store presentations and our continued success as media category manager. Net revenue in our direct to consumer segment decreased $6.0 million to $21.0 million during the second quarter of 2010 from $27.0 million during the second quarter of 2009. This 22.2% decrease in the direct to consumer segment net revenue primarily reflects our decisions to further reduce catalog circulation by 17%, decrease media spend for our direct response television by 24% and close unprofitable businesses. Net revenue in our solar segment increased $4.8 million, or 37.9%, to $17.5 million during the second quarter of 2010 from $12.7 million during the second quarter of 2009, primarily due to organic growth.

Net loss attributable to Gaiam, Inc. As a result of the above factors, net loss attributable to Gaiam, Inc. was $0.5 million during the second quarter of 2010 compared to $1.0 million during the second quarter of 2009. Net loss per share attributable to Gaiam, Inc. common shareholders was $0.02 per share during the second quarter of 2010 compared to $0.04 per share during the second quarter of 2009.

Net revenue. Net revenue increased $2.2 million, or 1.9%, to $118.6 million during the first half of 2010 from $116.4 million during the first half of 2009. Net revenue in our business segment increased $1.0 million, or 2.5%, to $40.5 million during the first half of 2010 from $39.5 million during the first half of 2009, primarily reflecting improvement in our domestic business, including increased store within store presentations, our continued success as media category manager and the addition of several new media and accessory brands, partially offset by a modest weakening in the consumer environment and the timing of some orders from retailers. Net revenue in our direct to consumer segment decreased $9.1 million to $45.6 million during the first half of 2010 from $54.7 million during the first half of 2009. This 16.6% decrease in the direct to consumer segment net revenue primarily reflects our decision to reduce catalog circulation by 20%, reduce media spend for our direct response television by 13.7% and close unprofitable businesses. Net revenue in our solar segment increased $10.3 million, or 46.3%, to $32.5 million during the first half of 2010 from $22.2 million during the first half of 2009, primarily due to organic growth.

Operating activities. Our operating activities provided net cash of $1.8 million and 17.1 million during the first halves of 2010 and 2009, respectively. Our net cash provided by operating activities during the first half of 2010 was primarily attributable to decreased accounts receivable of $11.2 million, noncash adjustments of $3.5 million, seasonally reduced inventory of $2.0 million and other current assets of $0.6 million, partially offset by decreased accounts payable of $8.5 million, reduced accrued liabilities of $4.7 million, increased deferred advertising costs of $1.5 million and our net loss of $0.8 million. Accounts receivable did not decline as much as in the comparable half of last year because a higher percentage of our sales during the first half of 2010 were to large retailer accounts which are on longer pay cycles. The reduction in accounts payable reflects payments for inventory purchases of holiday and fitness season shipments. Our net cash provided by operating activities during the first half of 2009 was primarily attributable to decreased accounts receivable and inventory of $12.1 million and $12.5 million, respectively, and refunded income taxes of $3.2 million, partially offset by decreased accounts payable and accrued liabilities of $6.7 million and net loss of $5.2 million.

Investing activities. Our investing activities used net cash of $4.4 million and $3.4 million during the first halves of 2010 and 2009, respectively. The net cash used in investing activities during the first half of 2010 was used primarily to acquire licensing rights for the Discovery Channels media catalog and other media content for $3.2 million and property and equipment to maintain normal operations for $1.2 million. The net cash used in investing activities during the first half of 2009 was used primarily to acquire property and equipment for $2.4 million, of which $0.8 million was acquired to maintain normal operations, and for media productions of $1.0 million.

Financing activities. Our financing activities used net cash of $2.7 million and $2.9 million during the first halves of 2010 and 2009, respectively. Our net cash used in financing activities during the first half of 2010 was the result of dividend payments of $3.5 million or $0.15 per share, partially offset by cash provided by stock option exercise issuances and their related tax benefits of $0.8 million. Our net cash used in financing activities during the first half of 2009 was used primarily to repurchase 932,000 shares of our Class A common stock.

Read the The complete Report

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