Volta Finance Limited : Net Asset Value(s) as at 31 August 2020
Volta Finance Limited (VTA / VTAS) – August 2020 monthly report
NOT FOR RELEASE, DISTRIBUTION OR PUBLICATION, IN WHOLE OR PART, IN OR INTO THE UNITED STATES
Guernsey, 10 September 2020
AXA IM has published the Volta Finance Limited (the “Company” or “Volta Finance” or “Volta”) monthly report for August. The full report is attached to this release and will be available on Volta’s website shortly (www.voltafinance.com).
PERFORMANCE and PORTFOLIO ACTIVITY
In August, the monthly performance of Volta is +1.9%. The performance may have been even higher but for USD weakness which had a negative impact close to -0.6%. The USD depreciated against EUR by 1.3% during the month while, after adjusting for hedging, Volta has a USD exposure of approximately 47%.
The monthly asset class performances** were in local currency: +0.3% for Bank Balance Sheet transactions, +3.5% for CLO Equity tranches; +2.9% for CLO Debt; +5.9% for Cash Corporate Credit deals (this bucket comprises funds that have a one-month delay in publishing their NAV); and +0.3% for ABS.
Now that all Q3 payments to our CLO equity positions have been made, we can confirm that all Volta’s equity positions received their coupon payments with one minor exception – a very old position that breached its Interest Diversion test now that all the AAA and most of the AA tranches amortized.
For comparison, Wells Fargo reported*** that 24% of USD CLOs were suffering a breach of the Interest Diversion test at the end of July, leading to a diversion of cash flow from the equity position.
Equally encouraging, the August trustee reports show that for most of our positions, CLO managers were able to improve cushions on reinvestment tests and OC tests. We expect all our positions to receive their full payment in October (except for the very old one noted above). Payments in October are expected to be higher than in July as the technical reductions that led to lower cash flows in Q3 will partially reverse as there will be no further negative impact from interest rate declines and we will receive full payments on the European loans that elected in Q2 to switch to a 6-month Euribor basis.
In August, Volta received the equivalent of €1m in terms of Interest or Coupons from its assets. On a 6-month rolling basis, Volta received the equivalent of €17.0m as at the end of August. It is still representing a 16% annualised yield based on the end of August NAV.
Looking further into the future, our view is still that although default rates in both loan markets (US and Europe) are expected to increase, we expect them to increase slowly. In such a context, full payment of cash flows to our CLO Equity positions is expected to stay the norm. Although the COVID crisis had an economic impact that is roughly twice more severe than the consequences of the Sub-prime crisis and the GFC, the impact on CLO equity and CLO debt is expected to be much more reduced, thanks to a delay in default occurrences.
We observed, in August, a significant tightening in USD CLO senior tranche spreads (Europe was lagging). Our view is that it was the first sign of what we expect on a more long term basis: CLO senior tranches are gaining traction amongst investors and even if it is too early to figure out when it might happen, we are more and more confident that at some point in time we might have the opportunity to refinance or reset some of Volta positions to benefit from a better arbitrage in favor of our CLO equity positions. USD CLO AAA tranches were issued at Libor+130/135bps spread before the COVID crisis and we are now almost back to these levels.
Regarding the CLO warehouse held by Volta, we entered discussions with the arranging bank to transform this position into an actual CLO, targeting pricing by the end of September.
As at the end of August 2020, Volta’s NAV was €212.1m or €5.80 per share.
The month-end available cash position was €8.9m leaving some room for investments.
*It should be noted that approximately 10.6% 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 note. The most recently available fund NAV or quoted price was for 4.6% as at 31 July 2020 and 6.0% as at 30 June 2020.
** “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.
*** ”CLO: This Week Down in the OC” – Wells Fargo Research, August 2020
For the Investment Manager
AXA Investment Managers Paris
+33 (0) 1 44 45 84 47
Company Secretary and Administrator
BNP Paribas Securities Services S.C.A, Guernsey Branch
+44 (0) 1481 750 853
Cenkos Securities plc
+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 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 753 investment professionals and €801 billion in assets under management as of the end of April 2020.
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.
One Liberty Plaza - 165 Broadway
NY 10006 New York
GlobeNewswire is one of the world's largest newswire distribution networks, specializing in the delivery of corporate press releases financial disclosures and multimedia content to the media, investment community, individual investors and the general public.
Subscribe to releases from GlobeNewswire
Subscribe to all the latest releases from GlobeNewswire by registering your e-mail address below. You can unsubscribe at any time.
Latest releases from GlobeNewswire
The MILLA Group Selects the Leddar Pixell From LeddarTech for the MILLA POD Autonomous Shuttle25.11.2020 06:11:00 CET | Press release
QUEBEC CITY, Nov. 25, 2020 (GLOBE NEWSWIRE) -- LeddarTech®, a global leader in Level 1-5 ADAS and AD sensing technology, is proud to have been selected by the MILLA Group as the supplier for their cocoon LiDAR sensor. The MILLA Group has selected the award-winning Leddar™ Pixell as the front-end LiDAR for their MILLA POD autonomous shuttle. The Leddar Pixell is the most robust solid-state LiDAR on the market. This sensor provides a 180-degree horizontal field of view (FoV) and can offer 360-degree coverage of a vehicle when four modules are used. The Leddar Pixell offers best-in-class shock and vibration resistance meeting ISO 16750-3 requirements and complies with the SAE J1455 standard for heavy dust intrusion, positioning the Leddar Pixell for use in the industrial vehicle markets requiring robustness and durability. Also, the Leddar Pixell is IP67 certified and provides an MTBF of more than 148,000 hours, which is equivalent to ten times that of scanning solutions. The Leddar Pixel
Golar LNG Partners LP: Q3 2020 results presentation24.11.2020 16:11:33 CET | Press release
Golar LNG Partners LP 3rd Quarter 2020 results will be released before the NASDAQ opens on Monday, November 30, 2020. In connection with this a webcast presentation will be held at 4:30 P.M (London Time) on Monday, November 30, 2020. The presentation will be available to download from the Investor Relations section at www.golarlngpartners.com Due to ongoing high levels of demand for their services, our platform providers highly recommended that participants join the conference call via the listen-only live webcast link provided. Sell-side analysts interested in raising a question during the Q&A session that will immediately follow the presentation should access the event via the conference call dial-in information below. Call handling may take longer than usual. You should therefore dial in 10-15 minutes prior to the start time. Information on how to ask questions will be given at the beginning of the Q&A session. There will be a limit of two questions per participant. a. Listen-only l
FORSVARET OG DFDS INDGÅR NY AFTALE24.11.2020 15:30:13 CET | pressemeddelelse
Investor news DFDS og Joint Movement and Transportation Organisation (JMTO), som leverer strategisk transport i forbindelse med danske militære opgaver, har i dag indgået en ny aftale.I alt syv fragtfærger (ro-ro) stilles ifølge aftalen til rådighed for søtransport af militært materiel og udstyr i forbindelse med NATO-beredskabet, deltagelse i militære øvelser og operationer samt humanitære kriser. Aftalen, der er indgået efter et offentligt udbud af opgaven, erstatter en tidligere aftale mellem forsvaret og DFDS, og løber i seks år. I det daglige vil færgerne være indsat på DFDS’ ruter og blive stillet til rådighed for militæret, når og i det omfang forsvaret anmoder om det. Aftalen er desuden knyttet til ARK-projektet, et dansk-tysk samarbejde, der sikrer dansk og tysk forsvar adgang til og rådighed over kapacitet til søtransport i henhold til nationernes egne forpligtelser over for NATO. Kontakt Torben Carlsen, CEO +45 33 42 3201 Karina Deacon, CFO +45 33 42 3342 Søren Brøndholt Nie
DFDS A/S: DANISH DEFENCE AND DFDS ENTER INTO NEW AGREEMENT24.11.2020 15:30:13 CET | Press release
Investor news Today, DFDS and the Joint Movement and Transport Organisation (JMTO), which provides strategic transport for Danish military missions, have entered into a new agreement. According to the agreement, a total of seven freight ferries (ro-ro) will be made available for the maritime transport of military materiel and equipment in connection with NATO preparedness, participation in military exercises and operations, and humanitarian crises. The agreement, concluded after the task went out to public tender, replaces an earlier agreement between the Danish Defence and DFDS, and runs for six years. On a day-to-day basis, the ferries will be deployed on DFDS’ routes, and will be made available to the military when and to the extent requested by the Danish Defence. The agreement is also linked to the ARK project, a Danish-German cooperation project, which ensures access to and availability of maritime transport capacity for Danish and German defences in accordance with the nations’
Cypress Development Reports Further Positive Metallurgical Results from Clayton Valley Lithium Project in Nevada24.11.2020 14:00:00 CET | Press release
VANCOUVER, British Columbia, Nov. 24, 2020 (GLOBE NEWSWIRE) -- Cypress Development Corp. (TSX-V:CYP) (OTCQB:CYDVF) (Frankfurt:C1Z1) (“Cypress” or “the Company”) reports the completion of additional metallurgical testing following the positive Prefeasibility Study (PFS) published on the Company’s 100%-owned Clayton Valley Lithium Project in Nevada, USA. The testing was conducted at Continental Metallurgical Services in Montana and NORAM Engineering in British Columbia, in preparation for the Company’s pilot plant program as outlined in the PFS. Highlights Testing resulted in 80.2% extraction of lithium when a sodium chloride solution was used instead of distilled water in leaching claystone under Cypress’ sulfuric acid leach process. Lithium in the resulting leach solution was successfully concentrated at levels comparable to the PFS with limited interference by chlorides and other minerals present. The ability to tolerate high chloride levels in the process is significant because it al
RevoluGROUP Canada Inc. RevoluSEND Extends Remittance Reach with Thunes24.11.2020 14:00:00 CET | Press release
VANCOUVER, British Columbia, Nov. 24, 2020 (GLOBE NEWSWIRE) -- RevoluGROUP Canada Inc. (TSX-V: REVO), (Frankfurt:IJA2) (the "Company") is pleased to announce that RevoluPAY EP S.L. has signed a Definitive Agreement ("DA") with Thunes on November 23rd, 2020. The DA, approved between RevoluPAY CEO Alfredo Manresa and Adrien Antoni, Director of Thunes, permits, with immediate effect, RevoluPAY® family remittances at over 9,000 collection partner agencies offered by www.thunes.com in +100 countries. The parties have agreed upon delivery commissions payable to Thunes, independent of the amount sent and per individual beneficiary delivery and origination via RevoluPAY. The Scope of The Thunes Accord Today's agreement with Thunes expands the reach of the Company's remittance vertical RevoluSEND into supplementary countries, adding 38 nations previously unavailable, most notably crucial high volume remittance markets (Denoted Bold). The addition of Brazil, Chile, and Haiti in South America. As