Gaiam, Inc reported that net revenue for the first quarter ended March 31 decreased 12.0 percent to $54.8 million from $62.2 million recorded in the same quarter last year.
Management said the decrease in net revenue was primarily attributable to a $7.7 million sales decline resulting from the company’s previously disclosed plans to lower direct response television advertising spend, as well as unusually low in-stock levels at the company’s largest retail customer as a result of the retailer’s replenishment delays and reduced sales to Borders resulting from its reorganization.
These factors were partially offset by positive comparables in the company’s catalog and internet businesses and solar segment.
The companys net loss for the quarter was $941,000, or 4 cents per diluted share, compared to a net loss of $319,000, or 1 penny per diluted share, in the year-ago period.
Gross margins were 47.2 percent of sales in the quarter, contracting 460 basis points from the year-ago period.
Management said the change in gross margin primarily resulted from decreased revenues in the higher margin direct response television business and increased revenues in the lower margin solar segment. Excluding the solar segment, gross profit as a percentage of net revenue was 55.7 percent of sales in the first quarter of 2011.
