Mr. Tony Rautava reports

PENDER GROWTH FUND PROVIDES FINANCIAL HIGHLIGHTS AND COMPANY UPDATES

Pender Growth Fund Inc. has released its financial and operational results for the year ended Dec. 31, 2023.

Financial highlights:

• Net income was $1,029,528 for the year ended Dec. 31, 2023 (Dec. 31, 2022 -- net loss of $127,838,962), primarily the result of positive investment performance during the year.
• Net income per Class C common share for the year ended Dec. 31, 2023, was 14 cents (Dec. 31, 2022 -- net loss per share of $16.85).
• The company's total shareholders' equity decreased by $353,077 from Dec. 31, 2022 ($70.2-million), to $69.9-million as at Dec. 31, 2023, primarily due to share repurchases of $1,382,605 under the company's normal course issuer bid (NCIB), offset by positive investment performance of $1,029,528 during the year.
• Shareholders' equity per share was $9.48 as at Dec. 31, 2023 (Dec. 31, 2022 -- $9.28).
• Shares outstanding were 7,368,229 as at Dec. 31, 2023, a decrease from Dec. 31, 2022 (7,569,929), as a result of share repurchases under the NCIB, which was renewed on Feb. 15, 2024.
• At Dec. 31, 2023, 77.1 per cent of the investment portfolio was made up of public companies and 22.9 per cent of private companies.
• Management expense ratio (MER) before performance fees was 2.31 per cent for the year ended Dec. 31, 2023, up 0.41 per cent compared with 1.90 per cent in 2022.

The company's portfolio is materially concentrated in the shares of one publicly listed portfolio company, Copperleaf Technologies Inc. As at Dec. 31, 2023, the company held 6,889,883 shares of Copperleaf with a value of $41,614,893, which was 59.5 per cent of the company's total shareholders' equity of $69,886,178 (Dec. 31, 2022 -- 6,762,065 shares with a value of $38,814,252, which was 55.3 per cent of the company's total shareholders' equity). There can be no assurance that the company will be able to realize the value of this investment. As at Dec. 31, 2023, the shares of Copperleaf are all held directly by the company, following the amalgamation with Pender Private Investments Inc. (PPI) discussed in the Pender Private Investments section.

Portfolio highlights

With the rate of inflation continuing to slow, central banks led by the U.S. Federal Reserve are taking the opportunity to signal a pivot in interest rate policy with the next rate move likely to be lower. There is still potential for volatility as the market was quick to adjust to these revised expectations, potentially setting the stage for disappointment if inflation remains sticky and rate cuts do not materialize to the degree expected. The company thinks these macro variables will likely remain in focus. It will continue to monitor these macro events and assess their impacts on the company and its portfolio companies with the goal to help the businesses it owns have the durability and balance sheet strength to weather a variety of economic environments.

Pender Growth Fund believes that the company continues to be well positioned today to pursue its investment objectives and it continues to find attractive investments opportunities as valuations in microcap and small-cap stocks in North America remain attractive despite the recent rally this year.

Investment results may be affected by future developments and new information that may emerge about inflation and the impact of central bank measures on the economy, the state of M&A (merger and acquisition) markets, geopolitical and other global events, factors that are beyond the company's control.

While macro events have driven investor sentiment, Pender Growth Fund has remained focused on its bottom-up fundamental research to identify companies that can thrive in a wide range of economic scenarios. The company believes that this environment provides compelling opportunities for long-term-focused investors and that the company is well positioned to continue to pursue its investment objectives.

In 2023, as always, Pender Growth Fund worked closely with its private portfolio companies and certain of its public portfolio companies.

Significant equity investments and recent developments

Pender Private Investments

On Dec. 31, 2023, the company completed an amalgamation of PPI, formerly the Working Opportunity Fund (EVCC) Ltd. (WOF), which was acquired by the company in May, 2021.

Copperleaf Technologies

At Dec. 31, 2023, the company held 9.3 per cent of Copperleaf's issued and outstanding shares. The value of the company's holdings of Copperleaf was $41.6-million at Dec. 31, 2023, which was 59.5 per cent of the company's total shareholders' equity.

Other highlights

Pender Growth Fund continued to acquire shares of the company in the market under its NCIB because the company believes the shares are trading at a discount to their intrinsic value. On Feb. 15, 2024, the company launched a new NCIB, under which the company may purchase a maximum of 630,188 shares, or 10 per cent of the company's public float on launch date, during the one-year period ending Feb. 14, 2025.

Pender Growth Fund encourages you to refer to the company's MD&A (management's discussion and analysis) and annual audited financial statements for the year ended Dec. 31, 2023, and other disclosures available under the company's profile on SEDAR+ for additional information.

About Pender Growth Fund Inc.

Pender Growth Fund is an investment firm. Its investment objective is to achieve long-term capital growth. The company utilizes its small-capital base and long-term horizon to invest in unique situations, primarily small-cap, special situations and illiquid public and private companies. The firm invests in public and private companies based primarily in Canada and the United States, principally in the technology sector. It trades on the TSX Venture Exchange under the symbol PTF and posts its NAV (net asset value) on its website, generally within five business days of each month-end.

We seek Safe Harbor.