PNI Digital (TSX: PN) is reporting a significant jump in revenues in the second quarter of 2014 as the Vancouver-based company prepares to be acquired by Staples, Inc. (Nasdaq: SPLS) in a $74-million deal.
Revenues grew to $5.2 million during the quarter, PNI announced May 14.
That’s a 26% increase compared with the same period a year ago when revenues were at $4 million.
The company attributed the growth to an increase in fees due to greater print revenue, better exchange rates and renegotiated contract terms.
PNI specializes in software allowing retailers to offer personalized products such as photo albums, business cards, stationery and invitations through mobile kiosks and apps.
Despite the bump in revenue, the company reported a net loss of $7.4 million compared with a net loss of $1.7 million during the same period a year prior.
CEO Kyle Hall said in a statement most of the loss came from a $5.8-million legal settlement with Bloom Stationers following a dispute over a service agreement.
He said the settlement “was essential to advancing our agreement with Staples."
PNI and Staples announced May 5 the office supply retailer was acquiring the tech company’s shares for $1.70 each — 32% above its May 2 closing price of $1.29.
Hall told Business In Vancouver earlier this month that PNI will function as a subsidiary to Staples and the Vancouver management team is expected to stay with the company.
Furthermore, the company expects to hire more staff throughout the year as a result of the deal.
PNI currently employs about 165 worldwide, while 150 are based on the West Coast.
Shareholders still have to approve the arrangement at a special meeting set for July.
