Fairfax India Holdings Reports Significant Financial Injuries
Financial Overview of Fairfax India Holdings Corporation
Fairfax India Holdings Corporation recently disclosed its financial performance for the year ended 2024, revealing a notable loss. This investment holding company, formed with a mission to ensure capital appreciation while preserving its assets, has faced challenges due to market fluctuations and foreign currency translations. The financial results indicate a net loss of $41.2 million, translating to a loss of $0.30 per diluted share, in stark contrast to the previous year, where it reported a net income of $371.8 million.
At the close of 2024, the company’s book value per share experienced a reduction of 4.1%, closing at $20.96, compared to $21.85 in the prior year. This decline is primarily attributed to unrealized foreign currency translation losses stemming from a stronger U.S. dollar relative to the Indian rupee.
Key Financial Highlights for 2024
The fiscal year saw Fairfax India experiencing some financial successes despite the overall loss. Here are the notable highlights:
Investment Gains
The company reported net realized gains on investments amounting to $218.9 million. This reflects gains significantly from sales of NSE, totaling $167.3 million, and partial sales of CSB Bank, accumulating to $43 million. Furthermore, excluding reversals of prior period unrealized gains, the company recorded a net change in unrealized gains on investments of $55.1 million.
Income Sources
Fairfax India generated an interest and dividend income of $61.5 million. This income mainly arose from significant dividends received from Seven Islands, amounting to $29.9 million, along with $4.4 million from Saurashtra, and an additional $16.3 million earned on government bonds.
Strategic Investments
The company engaged in various strategic investments throughout the year. On October 11, 2024, it finalized a notable investment into Global Aluminium Private Limited for $82.7 million. Moreover, an agreement was signed on December 3, 2024, to acquire an additional 10% equity interest in BIAL, with a phased payment structure totaling $255 million.
Financial Health and Cash Reserves
Despite the challenges, Fairfax India Holdings Corporation demonstrated resilience. At the end of the fiscal year 2024, the company exhibited strong financial health with cash and marketable securities totaling $214.4 million. This is complemented by an undrawn revolving credit facility amounting to $175 million, which ensures liquidity for future investments.
During 2024, Fairfax India actively repurchased its shares under its normal course issuer bid, acquiring and canceling 559,047 subordinate voting shares at an average price of $15.07 per share.
Shareholder Information
The weighted average common shares outstanding during the fourth quarter stood at approximately 135 million, which slightly decreased from around 135.5 million in the previous year. As of December 31, 2024, there were 104,839,462 subordinate voting shares and 30 million multiple voting shares outstanding.
Contact Information
For inquiries, shareholders can reach out to:
John Varnell, Vice President, Corporate Affairs, Fairfax India Holdings
95 Wellington Street West, Suite 800, Toronto, Ontario
Telephone: 416-367-4755
Frequently Asked Questions
What were Fairfax India Holdings' net earnings for 2024?
Fairfax India Holdings reported a net loss of $41.2 million for the fiscal year 2024.
How did foreign exchange impacts affect financial results?
The company's financial results were impacted by unrealized foreign currency translation losses as the U.S. dollar appreciated against the Indian rupee.
What were the key areas of investment gains?
Notable investment gains included realized profits on sales of NSE and CSB Bank, along with gains from various other fundamental investments.
How much cash reserves does Fairfax India Holdings have?
The company holds cash and marketable securities totaling $214.4 million as of December 31, 2024.
Who is the contact person for shareholder inquiries?
John Varnell, Vice President, Corporate Affairs, is the point of contact for shareholder inquiries.
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