Kanata’s Ackroo (TSX-V: AKR), a provider of customer loyalty technology to retailers, said higher stock-based compensation for employees drove the company deeper into the red in the firm’s third quarter.
Ackroo, which sells cloud-based gift cards and loyalty platforms, said on Monday that it lost $488,645 in the three months ending Sept. 30. That compares to a loss of $284,382 during the same period a year earlier.
The main culprit, the company said in a report to investors, is a move to grant options to employees and advisors in lieu of greater monetary compensation. It’s part of an effort to preserve cash and reduce operating expenses, the company stated.
Ackroo had $12,890 in cash on hand as of Sept. 30, down from $151,694 a year earlier. The company said the sharp decrease stemmed from paying down debt.
The company has made a series of acquisitions this year as it purchased the technology and related customer contracts of other firms in the industry.
This helped to increase its quarterly revenues by eight per cent to $560,564.
Ackroo CEO Steve Levely said the three-month period was “an exciting quarter.”
"We (continued) to grow our revenues and our customer base (as) we expanded the breadth of our offering with product enhancements,” he said in a statement. “Ackroo (is) poised for a great close to the year."
The company makes money through three primary services: a one‐time setup fee to deploy its technology and train customers; monthly recurring fees to process, support and further develop the product; and one‐time fees, such as charges to merchants for each purchased gift card.
The company’s share price was unchanged at 20 cents on the TSX Venture Exchange on Monday morning.