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Gaiam Inc. Reports Operating Results (10-Q)

November 08, 2010 | About:
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10qk

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Gaiam Inc. (GAIA) filed Quarterly Report for the period ended 2010-09-30.

Gaiam Inc. has a market cap of $173.23 million; its shares were traded at around $7.45 with a P/E ratio of 41.39 and P/S ratio of 0.62. The dividend yield of Gaiam Inc. stocks is 2.01%.GAIA is in the portfolios of Columbia Wanger of Columbia Wanger Asset Management, Chuck Royce of Royce& Associates, Jim Simons of Renaissance Technologies LLC.

Highlight of Business Operations:

Net revenue. Net revenue decreased $2.1 million, or 2.8%, to $72.3 million during the third quarter of 2010 from $74.4 million during the third quarter of 2009. Net revenue in our business segment increased $0.5 million, or 2.5%, to $21.0 million during the third quarter of 2010 from $20.5 million during the third quarter of 2009, primarily reflecting increased store within store presentations, our continued success as media category manager and the consolidation of a new business, partially offset by a modest weakening in the consumer environment. Net revenue in our direct to consumer segment decreased $4.3 million to $26.7 million during the third quarter of 2010 from $31.0 million during the third quarter of 2009. This 13.8% decrease in the direct to consumer segment net revenue primarily reflects our decisions to further reduce catalog circulation by 16%, decrease media spend for our direct response television by 17% and close unprofitable businesses. Net revenue in our solar segment increased $1.7 million, or 7.2%, to $24.6 million during the third quarter of 2010 from $23.0 million during the third quarter of 2009, due to organic growth.

Net income attributable to Gaiam, Inc. As a result of the above factors, net income attributable to Gaiam, Inc. was $0.9 million during the third quarter of 2010 compared to $0.4 million during the third quarter of 2009. Net income per share attributable to Gaiam, Inc. common shareholders was $0.04 per share during the third quarter of 2010 compared to $0.02 per share during the third quarter of 2009.

Net revenue. Net revenue increased $0.1 million, or 0.1%, to $190.9 million during the nine months ended September 30, 2010 from $190.8 million during the nine months ended September 30, 2009. Net revenue in our business segment increased $1.5 million, or 2.5%, to $61.5 million during the nine months ended September 30, 2010 from $60.0 million during the nine months ended September 30, 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. Net revenue in our direct to consumer segment decreased $13.4 million to $72.3 million during the nine months ended September 30, 2010 from $85.7 million during the nine months ended September 30, 2009. This 15.6% decrease in the direct to consumer segment net revenue primarily reflects our decision to reduce catalog circulation, reduce media spend for our direct response television and close unprofitable businesses. Net revenue in our solar segment increased $12.0 million, or 26.4%, to $57.2 million during the nine months ended September 30, 2010 from $45.2 million during the nine months ended September 30, 2009, due to organic growth.

Net income (loss) attributable to Gaiam, Inc. As a result of the above factors, net income attributable to Gaiam, Inc. was $0.1 million during the nine months ended September 30, 2010 compared to a net loss of $3.7 million during the nine months ended September 30, 2009. Net income per share attributable to Gaiam, Inc. common shareholders was $0.00 per share during the nine months ended September 30, 2010 compared to a net loss of $0.16 per share during the nine months ended September 30, 2009.

Investing activities. Our investing activities used net cash of $6.8 million and $5.6 million during the nine months ended September 30, 2010 and 2009, respectively. The net cash used in investing activities during the nine months ended September 30, 2010 was used primarily to acquire licensing rights for the Discovery Channels media catalog and other media content for $4.9 million and property and equipment to maintain normal operations for $1.9 million. The net cash used in investing activities during the nine months ended September 30, 2009 was used primarily to acquire property and equipment for $3.4 million, of which $1.5 million was acquired to maintain normal operations, and for media productions of $2.2 million.

Financing activities. Our financing activities used net cash of $2.7 million and $2.9 million during the nine months ended September 30, 2010 and 2009, respectively. Our net cash used in financing activities during the nine months ended September 30, 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 nine months ended September 30, 2009 was used primarily to repurchase 932,000 shares of our Class A common stock.

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