Volta Finance Ld Volta Finance Limited - Net Asset Value As At 31 January 2021

 
TIDMVTA 
 
 
   Volta Finance Limited (VTA / VTAS) -- January 2021 monthly report 
 
   NOT FOR RELEASE, DISTRIBUTION OR PUBLICATION, IN WHOLE OR PART, IN OR 
INTO THE UNITED STATES 
 
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   Guernsey, 9 February 2021 
 
   AXA IM has published the Volta Finance Limited (the "Company" or "Volta 
Finance" or "Volta") monthly report for January. The full report is 
attached to this release and will be available on Volta's website 
shortly ( 
https://www.globenewswire.com/Tracker?data=KPDbZVGficfU4j_-6rEGMZMBrkc67wrikHa6F-s9bgHazKlw4L47IdsZxHALvhPGd2lXy22wqLv_623LKrMqiT__p0BuOQT40EhGlaymrAg= 
www.voltafinance.com). 
 
   PERFORMANCE and PORTFOLIO ACTIVITY 
 
   In line with the second half of 2020, 2021 is starting well for Volta 
with a January performance at +3.9%. Although most equity markets were 
hesitating between the positive but limited progress in terms of 
vaccination and the resurgence of the Covid-19 pandemic with its new 
variants, CLO markets were continuing to perform well based on more 
optimistic market views. 
 
   For example, in December, Moody's upgraded 38 US CLO debt tranches and 
put on watch for potential upgrade 188 more. Fitch announced in January 
that it may consider positive revisions in the coming weeks or months 
following an overall review of the consequences of the Covid-19 crisis. 
Around year-end, new forecasts for default rates for the US and European 
loan markets were published and they were again revised downward. 
Although we are conscious that this default cycle is far from over (we 
still expect defaults in relation to the pandemic to spread at least to 
the end of 2022), default rates can be expected to be in the area of 3 
to 4% per year. This level is clearly manageable for CLO managers. In 
the US, for the third consecutive month, we saw a decrease of the 
trailing 12-month default rate measure to 3.4% (2.1% in Europe). 
 
   As a consequence, Volta's January performance was driven by its CLO 
buckets. The monthly asset class performances** were in euro: +-1.2% for 
Bank Balance Sheet transactions, +5.9% for CLO equity tranches; +4.1% 
for CLO Debt; +0.7% for Cash Corporate Credit deals (this bucket 
comprises funds that have a one-month delay in publishing their NAV); 
and +0.8% for ABS. 
 
   For months we have been highlighting that one consequence of the spread 
compression on CLO debt is to open the door for CLO refinancing and 
reset to reduce the average cost of debt that constitutes the embedded 
leverage for CLO equity positions. As of the end of January 2021, the 
total cost of debt for CLOs is at its lowest level for the last 2 years 
and, for Volta, we have started the process of refinancing or resetting 
some CLOs where we control the equity tranche. Combining US and European 
CLO markets, January 2021 was the most active January month in recent 
memory for CLO Refi and Reset activity and we expect the full year to 
remain very active. 
 
   In terms of cash flows, January was a solid month for Volta. Interest 
and coupons received totaled the equivalent of EUR7.6m. On a 6-month 
rolling basis, Volta received the equivalent of EUR20.4m to the end of 
January, representing a 16.1% annualised cash flow yield, based on the 
end January NAV (even taking into account the increase in NAV). We 
expect this income to increase in the coming months. 
 
   In January we purchased two recently issued European CLO equity 
positions in the secondary market for a total of EUR6.8m. On average and 
under standard assumptions, the projected yield of these purchases was 
close to 10.5 (not including potential upside in the case of 
Refi/Reset). 
 
   This combination of advantageous factors for our CLO Equity positions, 
which account now for a total of 65% of the NAV, alongside the 
likelihood of further spread compression in CLO Debt and other positions 
means that the outlook for 2021 and beyond is favorable for Volta. 
There will, no doubt, be ongoing bouts of volatility in markets but we 
are optimistic that the NAV should reach EUR7.00 per share at some point 
in 2021 and then to EUR7.50 per share in the medium term. This, combined 
with an estimate dividend close to 8% of NAV represents an attractive 
return stream especially when considering the discount to the NAV at 
which the shares are still trading. 
 
   As at the end of January 2021, Volta's NAV was EUR253.5m or EUR6.93 per 
share. 
 
   The month-end available cash position was EUR10.3m. 
 
   *It should be noted that approximately 3.0% 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 1.9% as at 31 December 2020 and 1.1% as at 30 September 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. 
 
   CONTACTS 
 
   For the Investment Manager 
 
   AXA Investment Managers Paris 
 
   Serge Demay 
 
   https://www.globenewswire.com/Tracker?data=_OekVSkaOMagHH6Exv3p32tbDlG7fUSo9zaE1KAdexXSCnUNafcdKLu8ScrJbR7UlYp53PbZs6cVHaRzVnZQfNJhcWVFToDHn-QpD_Za7sw= 
[e-mail] 
 
   [phone] 
 
   Company Secretary and Administrator 
 
   BNP Paribas Securities Services S.C.A, Guernsey Branch 
 
   https://www.globenewswire.com/Tracker?data=Yq_pDcNTMXAzaadr3FbvAojTazJKV_l668QNYPej94oX2RQaQbZuf0Filpc4DMgKi7bWmjhA7qoAp-Y2JgCbliTC4QKqVin-ugOBZXHlkjTeanxs9aEd5keDlh3NZi7X7V0eoinhnEhSWelm4skdj_W2KI2LHgcfFkz6qk8HsjuprcHxVdLCnnUb-VsS8DUBl42ArgHbAxRlOQElvD4uij8BZ7An6hHwzcZc1lRB9O-CPDzlP2-N68ZlBkAq7d68E2MCiOv_G1ORNDKHcbqDBh8vk866bzEHVAmReQjhLcDjXkR2xKB-fXtHzJbVtpmmQjWLVD_T-ScySuNVh2dE2wOyobzYwxBRGceSXdqVvsx8ssgQX-ETEar4KDhCCDuO 
[e-mail] 
 
   [phone] 
 
   Corporate Broker 
 
   Cenkos Securities plc 
 
   Andrew Worne 
 
   Daniel Balabanoff 
 
   Rob Naylor 
 
   [phone] 
 
   ***** 
 
   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. 
 
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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 753 investment professionals and EUR801 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. 
 
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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. 
 
   ***** 
 
   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. 
 
   ***** 
 
   Attachment 
 
 
   -- Volta - Monthly Report - January 2021 
      https://ml-eu.globenewswire.com/Resource/Download/2c70ce3d-bfad-447f-8510-3ac38d7623cc 
 
 
 
 
 
 
 

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February 09, 2021 12:00 ET (17:00 GMT)

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