Volta Finance Limited - Net Asset Value as at 30 November 2021
Volta Finance Limited
(VTA / VTAS)
– November
2021
monthly report
NOT FOR RELEASE, DISTRIBUTION,
OR PUBLICATION, IN WHOLE OR PART, IN OR INTO THE UNITED
STATES
***** Guernsey, 10 December 2021
AXA IM has published the Volta Finance Limited
(the “Company” or “Volta Finance” or “Volta”) monthly report for
November. The full report is attached to this release and will be
available on Volta’s website shortly (www.voltafinance.com).
PERFORMANCE and
PORTFOLIO ACTIVITY
November’s performance was positive at +1.0%.
The year-to-date total return of the Company is 17.5%. Once again
this month, the performance of Volta’s portfolio bore little
correlation to wider markets: loan cash flows remained resilient
and no meaningful news arose to alter the expectation that defaults
will remain low and cash flows strong.
The new Omicron Covid variant had a much wider
impact on broad equity market valuation but did not seem to
significantly influence the solid outlook for loans in 2022 and
2023. There remain billions available to refinance debt (including
loans) and the maturity wall of loan markets, both in the US and in
Europe, appears to be moving from 2025/2026 to 2028/2029 as a
result. Consequently, we anticipate several years with relatively
low default rates (as at the end of November, last-12-month default
rates are respectively 0.3% and 0.8% in the US and Europe).
For Volta, we remain significantly exposed to
CLO Equity positions (2/3rds of our assets) to benefit from the
large cash flows such positions are paying so far and are expected
to continue paying. In 2021 we succeeded in reshaping most of our
CLO equity positions by refinancing or resetting the long-term
leverage that supports the CLO Equity position arbitrage. All other
things being equal, we can expect to receive higher and longer-term
cash flows from such CLO Equity positions.
November is generally a relatively low-volume
month in terms of CLO interests and coupons with the equivalent of
€1.2m being received. On a 6-month rolling basis to the end of
November, Volta received the equivalent of €25.9m, representing a
19.1% annualised cash flow yield, based on the end of the month
NAV.
In November, we purchased some BB and B tranches
of CLOs, we took the opportunity of a CLO reset to add to an
existing CLO Equity position at a very competitive price (81.5% of
par) and we opened a new European CLO Warehouse for a total of
€15.7m equivalent.
Turning to the detailed asset classes, the
monthly performances** were: +0.8% for Bank Balance Sheet
transactions, +0.7% for CLO equity tranches; -0.1% for CLO debt;
+0.3% for Cash Corporate Credit and ABS (together representing 3.0%
of NAV). The long USD exposure contributed positively to the
monthly performance by 0.7%.
As at the end of November Volta is fully
invested and CLO Debt/Equity/Warehouses are representing 90% of the
assets. Month after month we are gradually transitioning Volta
towards being a pure CLO vehicle and this process will continue
with the remaining residual non-CLO assets during 2022.
As at the end of November 2021, Volta’s NAV was
€270.6m or €7.40 per share.
*It should be noted that approximately 9.2% 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 3.2% as at 31
October 2021, 0.7% as at 30 September 2021, and 5.3% as at 31 July
2021.
** “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 ManagerAXA
Investment Managers ParisSerge Demayserge.demay@axa-im.com+33 (0) 1
44 45 84 47
Company Secretary and
AdministratorBNP Paribas Securities Services S.C.A,
Guernsey Branchguernsey.bp2s.volta.cosec@bnpparibas.com +44
(0) 1481 750 853
Corporate BrokerCenkos Securities plcAndrew
WorneDaniel Balabanoff+44 (0) 20 7397 8900
***** 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
capital across the credit cycle and to provide a stable stream of
income to its shareholders through dividends. Volta seeks to attain
its investment objectives predominantly through diversified
investments in structured finance assets. The assets that the
Company may invest in either directly or indirectly include, but
are not limited to: corporate credits; sovereign and
quasi-sovereign debt; residential mortgage loans; and, automobile
loans. The Company’s approach to investment is through vehicles and
arrangements that essentially provide leveraged exposure to
portfolios of such underlying assets. 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.
*****
ABOUT AXA INVESTMENT
MANAGERSAXA 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 767 investment
professionals and €866 billion in assets under management as of the
end of June 2021.
*****
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.
*****
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.
*****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.
*****
- Volta - November Monthly Report
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