NOT FOR RELEASE, DISTRIBUTION OR PUBLICATION, IN WHOLE OR IN PART, IN OR INTO THE UNITED STATES
Guernsey, 20 August 2014 - Volta Finance Limited (the "Company" or "Volta Finance" or "Volta") has published its monthly report. The full report is attached to this release and is available on Volta Finance Limited's financial website (www.voltafinance.com).
Gross Asset Value
| || At 31.07.14 || At 30.06.14 |
| Gross Asset Value (GAV / € million) || 274.0 || 270.3 |
| GAV per share (€) || 7.51 || 7.41 |
At the end of July 2014, the Gross Asset Value* (the "GAV") of Volta Finance Limited (the "Company", "Volta Finance" or "Volta") was €274.0 m or €7.51 per share, an increase of €0.10 per share from the end of June 2014.
This brings the performance for the first 7 months of 2014 to +6.1% including the April dividend payment.
We take the opportunity of this report to again remind investors that, since March 2014, we have changed the way the GAV (Gross Asset Value) is computed to get closer to a NAV (Net Asset Value) measure by deducting from the valuation of our assets the accrued management and incentive fees on a monthly basis. We felt it would be a better measure of Volta's intrinsic value to the extent fees could be predicted, rather than to deduct management fees on a semi-annual basis and take the corresponding hit on valuation twice a year. At the end of July, the accrued amount of fees represented €1.5m.
The July mark-to-market variations* of Volta's asset classes have been: -0.1% for Synthetic Corporate Credit deals, +0.7% for CLO Equity tranches; +0.0% for CLO Debt tranches, -0.2% for Cash Corporate Credit deals and +2.0% for ABS. The positive performance of Volta in July is mostly due to the depreciation of the Euro against USD and GBP as credit markets were roughly weak.
Volta's assets generated the equivalent of €3.1m cash flows in July 2014 (non-Euro amounts converted to Euro using end-of-month cross currency rates and excluding principal payments from debt assets) bringing the total cash generated during the last six months to €15.0m.
In July, Volta invested in one transaction, a USD BB tranche of CLO from the primary market for the equivalent of €4m and sold one position, an old BB tranche of CLO for the equivalent of €3.6m. Under reasonable and standard assumptions, the projected IRR of the purchase was close to 8.3%, 6% for the sale. In July we received principal payment from one old European CLO (Tara Hill) : the original BBB tranche was fully paid as well as part of the original BB, resulting in a total principal payment of €2.8m.
At the end of July, Volta held €18.1m in cash including €0.3m posted in relation to its currency hedge positions. Taking into account unsettled commitment (the remaining USD10m committed of the warehouse transaction), Volta has approximately €8m available to invest.
In July 2014, credit markets spread widened both in Europe and in the US : the 5 year iTraxx European Main index and 5 year iTraxx European Crossover Index (series 21) spreads went respectively from 62 and 242 bps at the end of June 2014 to 65 and 264 bps at the end of July 2014. In the US, in the same vein, the 5y CDX main index (series 22) widened from 59 to 64 bps. According to the CSFB Leverage Loan Index, the average price for US liquid first lien loans went down from 99.08% at the end of June 2014 to 98.65% at the end of July 2014. In Europe, the price of the S&P European Leveraged Loan Index was unchanged at 95.12%. **
VOLTA FINANCE PORTFOLIO
In July 2014, no particular event materially impacted any of Volta's assets.
We continue seeing opportunities in several structured credit sectors including mezzanine or equity tranches of CLOs, RMBS tranches as well as tranches of Cash or Synthetic Corporate Credit portfolios.
* "Mark-to-market variation" is calculated as the Dietz-performance of the assets in each bucket, taking into account the Mark-to-Market of the assets at month-end, 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.
** Index data source: Markit, Bloomberg.
(Full monthly report in attachment or on www.voltafinance.com)
ABOUT VOLTA FINANCE LIMITED
Volta Finance Limited is incorporated in Guernsey under the Companies (Guernsey) Law, 2008 (as amended) and listed on NYSE Euronext Amsterdam. Its investment objectives are to preserve capital and to provide a stable stream of income to its shareholders through dividends. For this purpose, it pursues a multi-asset investment strategy targeting various underlying 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; automobile loans. Volta Finance Limited's basic approach to its underlying assets is through vehicles and arrangements that provide leveraged exposure to some of those underlying assets.
Volta Finance Limited 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 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 €553 billion in assets under management as of the end of December 2012. AXA IM employs approximately 2,450 people around the world and operates out of 21 countries.
Sanne Group (Guernsey) Limited
+44 (0) 1481 739810
For the Investment Manager
AXA Investment Managers Paris
+33 (0) 1 44 45 84 47
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. The company 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'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. Volta Finance 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.
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The issuer of this announcement warrants that they are solely responsible for the content, accuracy and originality of the information contained therein.
Source: Volta Finance Limited via Globenewswire