Volta Finance Limited (VTA / VTAS) - January 2024 monthly report
NOT FOR RELEASE, DISTRIBUTION, OR PUBLICATION, IN WHOLE OR PART, IN OR INTO THE
UNITED STATES
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Guernsey, February 16(th), 2024
AXA IM has published the Volta Finance Limited (the "Company" or "Volta Finance"
or "Volta") monthly report for January 2024. The full report is attached to this
release and will be available on Volta's website shortly (www.voltafinance.com
(http://www.voltafinance.com)).
PERFORMANCE and PORTFOLIO ACTIVITY
Volta Finance started the year on a positive note as the fund achieved a
performance of +2.8% in January 2024. This was the extension of Volta's strong
momentum as the fund recorded its seventh positive month in a row. The
performance since July-end 2023 consequently reached double digits, at +11.1%.
CLOs delivered solid returns in January and outperformed traditional credit
markets, especially US Corporates (+0.16%, ICE BofA Corp Index) and US High
Yield (+0.04%, ICE BofA HY Index). While imminent rate cuts were priced-in,
markets were caught off-guard by strong data releases and the subsequent
uncertainty regarding central banks' next move. Floaters such as CLOs fully
benefited from the repricing of the rates curve, capturing more income on their
floating leg while credit margins tightened due to the increased demand for the
asset class given the superior risk/reward profile of CLOs compared to
traditional credits.
Looking at CLO Equity, we closely monitor loan dynamics and particularly the
current repricing action taking place both in the US and Europe. In fact, the
proportion of loans trading above par topped at 40% in early January before
tipping down to 13% at month-end in the US market / 17% in the European market.
This should lead to more loan repricing activity for the months to come and thus
we are now seeing the loans' weighted average spread within CLO underlying
portfolios being at their top.
Still, in terms of cashflows, January 2024 was a good month for Volta: it
received the equivalent of EUR11.5m of interests and coupons (in line with the
previous quarter). Over the last 6-month period, Volta received EUR27.2m of
interests and coupons, ie a 21.6% annualized cash flow to NAV. This compares
well with the 21.6% annualized cash flow to NAV measured as of January 2023
where the NAV per share was standing at 6.16.
In terms of management, we used the January's strength to keep on rotating from
a post-reinvestment period CLO debt tranche into a new-issue transaction: as
expressed in earlier communications, we favor clean collateral pool of assets as
the full impact of the aggressive rate hikes over the past two years sinks in.
Also, we kept on investing in our 2 US CLO warehouses recognizing that CLO debt
tranches tightening is improving CLO Equity arbitrage and that one of our CLO
managers is scrutinizing to make the CLO take-out.
Volta's underlying sub asset classes monthly performances** were as follow:
+0.9% for Bank Balance Sheet transactions, +2.2% for CLO Equity tranches, +4.8%
for CLO Debt tranches and -1.2% for Cash Corporate Credit and ABS.
As of end of January 2024, Volta's NAV was EUR251.9m, i.e. EUR6.89 per share.
*It should be noted that approximately 0.68% of Volta's GAV comprises
investments for which the relevant NAVs as at the month-end date are normally
available only after Volta's NAV has already been published. Volta's policy is
to publish its NAV on as timely a basis as possible to provide shareholders with
Volta's appropriately up-to-date NAV information. Consequently, such investments
are valued using the most recently available NAV for each fund or quoted price
for such subordinated notes. The most recently available fund NAV or quoted
price was 0.42% as at 29 December 2023 and 0.25% as at 30 September 2023.
** "performances" of asset classes are calculated as the Dietz-performance of
the assets in each bucket, taking into account the Mark-to-Market of the assets
at period ends, payments received from the assets over the period, and ignoring
changes in cross-currency rates. Nevertheless, some residual currency effects
could impact the aggregate value of the portfolio when aggregating each bucket.
CONTACTS
For the Investment Manager
AXA Investment Managers Paris
François Touati
francois.touati@axa-im.com (mailto:serge.demay@axa-im.com)
+33 (0) 1 44 45 80 22
Olivier Pons
Olivier.pons@axa-im.com (mailto:Olivier.pons@axa-im.com)
+33 (0) 1 44 45 87 30
Company Secretary and Administrator
BNP Paribas S.A, Guernsey Branch
guernsey.bp2s.volta.cosec@bnpparibas.com
(https://www.globenewswire.com/Tracker?data=8TYqe1zzDqrQV8m8k-
fbuFfCPWcNVqXrTTQMy3Vw8CpoBFOGhqpPpexeVMzzK3ctUViX81WWkeuOxG9NHYG9jpMG8R0hD_N6-
LtgNWE1arDUTmA3IXFWi7YN-Tx87SohQjtqLRvKjC0Xt9Uez6CGwy7YMZBDTJNaoPfIdb0fq48=)
+44 (0) 1481 750 853
Corporate Broker
Cenkos Securities plc
Andrew Worne
Daniel Balabanoff
+44 (0) 20 7397 8900
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ABOUT VOLTA FINANCE LIMITED
Volta Finance Limited is incorporated in Guernsey under The Companies (Guernsey)
Law, 2008 (as amended) and listed on Euronext Amsterdam and the London Stock
Exchange's Main Market for listed securities. Volta's home member state for the
purposes of the EU Transparency Directive is the Netherlands. As such, Volta is
subject to regulation and supervision by the AFM, being the regulator for
financial markets in the Netherlands.
Volta's Investment objectives are to preserve its capital across the credit
cycle and to provide a stable stream of income to its Shareholders through
dividends that it expects to distribute on a quarterly basis. The Company
currently seeks to achieve its investment objectives by pursuing exposure
predominantly to CLO's and similar asset classes. A more diversified investment
strategy across structured finance assets may be pursued opportunistically. The
Company has appointed AXA Investment Managers Paris an investment management
company with a division specialised in structured credit, for the investment
management of all its assets.
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ABOUT AXA INVESTMENT MANAGERS
AXA Investment Managers (AXA IM) is a multi-expert asset management company
within the AXA Group, a global leader in financial protection and wealth
management. AXA IM is one of the largest European-based asset managers with
2,600 professionals and EUR824 billion in assets under management as of the end of
June 2023.
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This press release is published by AXA Investment Managers Paris ("AXA IM"), in
its capacity as alternative investment fund manager (within the meaning of
Directive 2011/61/EU, the "AIFM Directive") of Volta Finance Limited (the "Volta
Finance") whose portfolio is managed by AXA IM.
This press release is for information only and does not constitute an invitation
or inducement to acquire shares in Volta Finance. Its circulation may be
prohibited in certain jurisdictions and no recipient may circulate copies of
this document in breach of such limitations or restrictions. This document is
not an offer for sale of the securities referred to herein in the United States
or to persons who are "U.S. persons" for purposes of Regulation S under the U.S.
Securities Act of 1933, as amended (the "Securities Act"), or otherwise in
circumstances where such offer would be restricted by applicable law. Such
securities may not be sold in the United States absent registration or an
exemption from registration from the Securities Act. Volta Finance does not
intend to register any portion of the offer of such securities in the United
States or to conduct a public offering of such securities in the United States.
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This communication is only being distributed to and is only directed at (i)
persons who are outside the United Kingdom or (ii) investment professionals
falling within Article 19(5) of the Financial Services and Markets Act 2000
(Financial Promotion) Order 2005 (the "Order") or (iii) high net worth
companies, and other persons to whom it may lawfully be communicated, falling
within Article 49(2)(a) to (d) of the Order (all such persons together being
referred to as "relevant persons"). The securities referred to herein are only
available to, and any invitation, offer or agreement to subscribe, purchase or
otherwise acquire such securities will be engaged in only with, relevant
persons. Any person who is not a relevant person should not act or rely on this
document or any of its contents. Past performance cannot be relied on as a guide
to future performance.
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This press release contains statements that are, or may deemed to be, "forward-
looking statements". These forward-looking statements can be identified by the
use of forward-looking terminology, including the terms "believes",
"anticipated", "expects", "intends", "is/are expected", "may", "will" or
"should". They include the statements regarding the level of the dividend, the
current market context and its impact on the long-term return of Volta Finance's
investments. By their nature, forward-looking statements involve risks and
uncertainties and readers are cautioned that any such forward-looking statements
are not guarantees of future performance. Volta Finance's actual results,
portfolio composition and performance may differ materially from the impression
created by the forward-looking statements. AXA IM does not undertake any
obligation to publicly update or revise forward-looking statements.
Any target information is based on certain assumptions as to future events which
may not prove to be realised. Due to the uncertainty surrounding these future
events, the targets are not intended to be and should not be regarded as profits
or earnings or any other type of forecasts. There can be no assurance that any
of these targets will be achieved. In addition, no assurance can be given that
the investment objective will be achieved.
The figures provided that relate to past months or years and past performance
cannot be relied on as a guide to future performance or construed as a reliable
indicator as to future performance. Throughout this review, the citation of
specific trades or strategies is intended to illustrate some of the investment
methodologies and philosophies of Volta Finance, as implemented by AXA IM. The
historical success or AXA IM's belief in the future success, of any of these
trades or strategies is not indicative of, and has no bearing on, future
results.
The valuation of financial assets can vary significantly from the prices that
the AXA IM could obtain if it sought to liquidate the positions on behalf of the
Volta Finance due to market conditions and general economic environment. Such
valuations do not constitute a fairness or similar opinion and should not be
regarded as such.
Editor: AXA INVESTMENT MANAGERS PARIS, a company incorporated under the laws of
France, having its registered office located at Tour Majunga, 6, Place de la
Pyramide - 92800 Puteaux. AXA IMP is authorized by the Autorité des Marchés
Financiers under registration number GP92008 as an alternative investment fund
manager within the meaning of the AIFM Directive.
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