Fairfax Africa Holdings Corporation

First Quarter Financial Results

NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES

(Note: All dollar amounts in this news release are expressed in U.S. dollars except as otherwise noted. The financial results are prepared using the recognition and measurement requirements of International Financial Reporting Standards, except as otherwise noted, and are unaudited.)

TORONTO, April 30, 2020 (GLOBE NEWSWIRE) -- Fairfax Africa Holdings Corporation (TSX: FAH.U) announces a net loss of $121.8 million in the first quarter of 2020 ($2.05 net loss per diluted share), compared to a net loss of $21.5 million in the first quarter of 2019 ($0.35 net loss per diluted share), reflecting increased net unrealized losses on investments and net foreign exchange losses in the quarter.

Highlights in the first quarter of 2020 included the following:

• Net loss of $121.8 million included a net change in unrealized losses on investments of $68.6 million, principally from decreases in the market price of the company's investment in Atlas Mara common shares ($36.3 million), as well as the fair value of the company's indirect equity interest in AGH ($18.8 million), and net foreign exchange losses of $52.5 million reflecting a weakening of the South African rand relative to the U.S. dollar. The net loss in the first quarter of 2020 reflected negative market reactions to the COVID-19 pandemic and related government interventions, combined with a simultaneous shock to global energy markets.
• On February 28, 2020 Fairfax Africa invested an additional $3.1 million (49.3 million South African rand) in GroCapital Holdings. Upon completion of this transaction, the company had invested aggregate cash consideration of $17.6 million (253.7 million South African rand) and at March 31, 2020 the fair value of the company's equity interest in GroCapital was $10.0 million (179.2 million South African rand).
• On March 30, 2020 the company entered into a secured lending arrangement with Atlas Mara pursuant to which Fairfax Africa agreed to provide up to $40.0 million of financing. The facility will earn interest at a rate of 10% per annum and will mature on March 31, 2021. At March 31, 2020 the facility was undrawn by Atlas Mara. Subsequently on April 2, 2020 $20.5 million was advanced to Atlas Mara under the facility.
• During the first quarter of 2020 the company purchased for cancellation 463,506 subordinate voting shares under the terms of the normal course issuer bid at a cost of $1.9 million (approximately $3.99 per subordinate voting share).
• During this period of uncertainty, Fairfax Africa remains in strong financial health, with sufficient undeployed cash and marketable securities.
• At March 31, 2020 common shareholders' equity was $395.2 million, or book value per share of $6.69, compared to $518.8 million, or book value per share of $8.72, at December 31, 2019, a decrease of 23.3% primarily related to the net loss in the first quarter of 2020.

There were 59.4 million and 62.0 million weighted average shares outstanding during the first quarters of 2020 and 2019 respectively. At March 31, 2020 there were 29,032,975 subordinate voting shares and 30,000,000 multiple voting shares outstanding.