18.03.2024 18:15:07 - dpa-AFX: GNW-Adhoc: Volta Finance Limited - Net Asset Value as at 29 February 2024
Volta Finance Limited (VTA / VTAS) - February 2024 monthly report
NOT FOR RELEASE, DISTRIBUTION, OR PUBLICATION, IN WHOLE OR PART, IN OR INTO THE
UNITED STATES
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Guernsey, March 18(th), 2024
AXA IM has published the Volta Finance Limited (the "Company" or "Volta Finance"
or "Volta") monthly report for February 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 is pleased to report another positive performance in February at
+1.0%, reflecting the price appreciation of the fund's underlying portfolios
through the month. For comparison, US High Yield returned +0.31% and European
High Yield returned +0.35% over the same period.
The strong sentiment from January fed through February as major Credit indices
like iTrax Xover hit 2yrs tights at +300bps. European loans were slightly down
from 97.00px to 96.80px, although still significantly up year-to-date (96.00px
as of Dec 2023). On the US side, loans recorded a 20 cents gain and reached
96.45px, their highest level since mid-2022. The momentum was evidently
supported by a strong Q4 2023 US earnings season - proving once more the
resilience of the US economic activity. Bonds yields continued to trend higher
amid ongoing evidence of sticky core inflation and central banks' hinting at
potentially delaying rate cuts.
In terms of CLO issuance, the US and European primary markets have fully
reopened. Issuance volumes have surged by +48% in the U.S., reaching $33.66
billion, and by +12% in Europe, totalling EUR5.84 billion compared to year-to-date
figures for 2023. This impacted secondary as volumes of activity reduced in
favor of the primary market and as spreads moved inside of primary (50bps for
instance on CLO BB tranches).
Strategy in February was to take advantage of the strong momentum in both the
Primary CLO market and Loans. We converted one of our US CLO warehouse
investment into a New Issue US CLO transaction, from which we purchased an CLO
Equity position ($7.93m invested) in the early days of February. Also, we
continued to rotate from vintaged CLO debt tranches that had passed their
reinvestment period into New Issue transactions as we purchased $6m of fresh US
BBs and sold c.$5m of US CLO BB. Last but not least, we were able to participate
in another US CLO Equity (c. $4.3m consideration) with upside scenarios in the
16-18% IRR range.
From the perspective of cashflow generation, over the last 6-month period Volta
received 21.6% annualized cash flow compared to NAV (EUR27.5m of interests and
coupons), a level that is largely stable since early 2023. We expect
distributions to be broadly stable at the April distribution date.
In terms of relative value, we currently see more value in equity over BB/B. We
appreciate the high cash-on-cash nature of CLO equity and its shorter duration
profile. Our preferred route for CLO equity is in the primary market, where we
can select the right manager and source sizes to target mid-teens returns. We
also opportunistically explore the secondary market to optimize our fund.
Volta's underlying sub asset classes monthly performances** were as follow:
+1.2% for Bank Balance Sheet transactions, +1.7% for CLO Equity tranches, +1.6%
for CLO Debt tranches and -14.3% for Cash Corporate Credit and ABS.
As of end of February 2024, Volta's NAV was EUR254.7m, i.e. EUR6.96 per share.
*It should be noted that approximately 5.47% 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 5.22% as at 31 January 2024 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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