HAMILTON, Ontario, March 04, 2024 (GLOBE NEWSWIRE) -- Ackroo Inc. (TSX-V: AKR; OTC: AKRFF) (the "Company"), a gift card, loyalty marketing, payments and point-of-sale technology consolidator and services provider, is pleased to provide an update on their recent acquisition of Simpliconnect. On January 1st 2024, Ackroo acquired all of the assets related to Simpliconnect, a US based loyalty marketing provider focused on the convenience and petroleum merchant segment. The Company wishes to provide investors with an update on their progress integrating, operating and optimizing that business.
The Company has managed to streamline operations from a vendor management, client pricing, support and employee standpoint resulting in operational efficiencies and profitability. Ackroo is also building product parity between the Simpliconnect platform and their Ackroo Anywhere platform and has already begun migrating clients over to Ackroo's core marketing product. This work, both product parity and migration, is expected to be completed by the end of April 2024 which will allow acquired merchants to begin benefiting from the ongoing advancements within the Ackroo platform while also allow current and prospective Ackroo merchants the ability to take advantage of the many features and integrations added via the Simpliconnect product parity work. Once complete the legacy platform will be decommissioned driving greater focus for sales and marketing, saving Ackroo hosting costs, and allowing engineering and support staff to be re-directed to focus on supporting the core Ackroo platform and the recent acquisition of GiftFly.
The Company has also achieved financial gain from the acquisition in its first year of contribution, delivering $1,234,108 of annual revenue and adding $202,698 of net income representing a strong 16% profit margin. As of January 1st, 2024, through continued normalization, Ackroo is now generating a 60% + profit margin from this business which they expect will continue through migration and beyond.
From a return on invested capital standpoint, the final consideration from Ackroo was just under $1,800,000 CAD plus 5,625,000 shares after an amendment was made in the spring of 2023, with Ackroo expecting to see the cash investment paid back within 39 months of closing based on the past and current margins being generated. Over the last year, the Company has also bought back 6,068,681 shares via a Normal Course Issuer Bid at an average price of $0.087 per share effectively cancelling out the shares issued to Simpliconnect earlier in the year. At $0.087 a share the 5,625,000 shares cost Ackroo approximately $489,375 which equates to about 8 months of future earnings from this business for a total expected payback time of about 47 months. This falls within the Company's payback model and positions Ackroo for another successful accretive acquisition.
"We are very happy with the continued progress we have made integrating and optimizing the Simpliconnect business," said Steve Levely, CEO of Ackroo. "The Simpliconnect business was a bit more complex than we originally thought from both a technical and operational standpoint. Ackroo being very self-serve technology focused versus Simpliconnect being more services support focused created early support challenges. The Simpliconnect engineering team was also outsourced versus Ackroo's in-house development team so managing those outsourced relationships and gaining internal control created initial challenges. While normalization and migration is expected to take 16 months versus our 12 month model, there were plenty of great wins for the business operationally, technically and certainly financially that we are ultimately very happy at this stage. This acquisition is pushing our technology forward, is helping us expand further into the US market, helping reinforce our specialization in areas like convenience and petroleum, and financially contributing to our growing earnings. All very positive things for Ackroo and our investors."
The Company cautions that figures for revenue have not been audited and are based upon calculations prepared by management. Actual results may differ from those reported in this release once these figures have been audited. The Company expects to complete its 2023 audit in April to confirm revenue figures, along with other financial results.
About Ackroo
As an industry consolidator, Ackroo acquires, integrates and manages gift card, loyalty marketing, payment and point-of-sale solutions used by merchants of all sizes. Ackroo's self-serve, data driven, cloud-based marketing platform helps merchants in-store and online process and manage loyalty, gift card and promotional transactions at the point of sale. Ackroo's acquisition of payment ISO's affords Ackroo the ability to resell payment processing solutions to their growing merchant base through some of the world's largest payment technology and service providers. As a third revenue stream, Ackroo has acquired certain custom software products including hybrid management and point-of-sale solutions that help manage and optimize the general operations for niche industry's including automotive dealers and more. All solutions are focused on helping to consolidate, simplify and improve the merchant marketing, payments and point-of sale ecosystem for their clients. Ackroo is headquartered in Hamilton, Ontario, Canada. For more information, visit: www.ackroo.com.
For further information, please contact:
| Steve Levely Chief Executive Officer | Ackroo Tel: 416-360-5619 x730 Email: slevely@ackroo.com |
The TSX Venture Exchange has neither approved nor disapproved the contents of this press release. Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Forward Looking Statements
This release contains forecasts and forward-looking statements that are not guarantees of future performance and activities and are subject to risks and uncertainties. The Company has based these forward-looking statements on assumptions and assessments made by its management in light of their experience and their perception of historical trends, current conditions, expected future developments and other factors they believe to be appropriate. Important factors that could cause actual results, developments and business decisions to differ materially from those anticipated in these forward-looking statements include, but are not limited to: the Company's ability to raise enough capital to support the Company's go forward plans; the overall global economic environment; the impact of competition and new technologies; general market, political and economic conditions in the countries in which the Company operates; projected capital expenditures and liquidity; changes in the Company's strategy; government regulations and approvals; changes in customers' budgeting priorities; plus other factors that may arise. Any forward-looking statements in this press release are made as of the date hereof, and the Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
