VOLTA FINANCE - JUNE MONTHLY REPORT>
VOLTA FINANCE - JUNE MONTHLY REPORT
(Thomson Reuters ONE) - NOT FOR RELEASE, DISTRIBUTION OR PUBLICATION, IN WHOLE OR IN PART, INOR INTO THE UNITED STATES*****Guernsey, 17 July 2009 - Volta Finance Limited (the "Company" or"Volta Finance" or "Volta") has published its June monthly report.The full report is attached to this release and is available on VoltaFinance Limited's financial website (www.voltafinance.com).Gross Asset Value+---------------------------------------------------------+| | At 30.06.09 | At 29.05.09 ||-----------------------------+-------------+-------------|| Gross Asset Value (GAV / ??¬) | 56,239,370 | 56,092,778 ||-----------------------------+-------------+-------------|| GAV per share (?) | 1.86 | 1.86 |+---------------------------------------------------------+As of the end of June 2009, the Gross Asset Value (the "GAV") ofVolta Finance Limited (the "Company", "Volta Finance" or "Volta") was?56.2m against ?56.1m at the end of May 2009 leaving the value at?1.86 per share unchanged,The June mark-to-market variations* of Volta Finance's asset classeshave been: +0.3% for ABS investments, +3.2% for CDO investments and+12.4% for Corporate Credit investments. The GAV is also affected bythe month end price at which intra-month purchased assets are markedand by fees paid during the month.Volta's assets have generated the equivalent of ?0.4m of cash flows(non-Euro amounts converted into Euro using end-of-month crosscurrency rates), bringing the total cash generated for the currentsemi-annual period that began on 1st February 2009 to ?7.5m, comparedwith ?11.5m for the same 5-month period in 2008.In June, the Company purchased two CDO mezzanine debt assets for atotal of ?0.8m.On June 23, during its last quarterly Board meeting, the Companyvalidated the reduction of some structural fixed costs such as theboard remuneration together with initially fixed fees of some of itsproviders. More details will be given in the annual report coveringthe annual period ending on 31 July 2009.MARKET ENVIRONMENTIn June, after two very positive months for most of credit and equitymarkets, the credit markets have been torn between the pursuit of theglobal recovery in economic sentiments and the reminder from realeconomic statistics that the economic situation is stilldeteriorating, albeit at a lower pace than few months ago.The 5y European iTraxx index (series 11) as well as the 5y iTraxxEuropean Crossover Index (series 11) modestly tightened respectivelyfrom 121 bps to 112 bps and from 725 bps to 713 bps from the end ofMay to the end of June 2009. During the same period of time,according to the CSFB Leverage Loan Index, the average price for USliquid first lien loans increased for the sixth consecutive month,from 73.58% to 76.47%.**VOLTA FINANCE PORTFOLIOIn June, the Company bought two mezzanine debt tranches of EuropeanCDO: ?2m of nominal of the Serie II tranche of Leveraged FinanceCapital II CLO issued in August 2003 and managed by BNP Paribas(initially and still rated AA- by S&P and AA3 by Moody's) as well as?1.5m of nominal of the Serie III of ADAGIO III CLO issued in July2006 and managed by AXA IMP (initially and still rated A by S&P andA2 by Moody's, with a negative outlook from moody's since 4th march2009).As regards the Company's Corporate Credit holdings, Jazz III maysuffer in July the default of CIT Group Inc that is considered bymost of market participants as highly probable (the exposure to CITGroup Inc is 0.65% of the underlying portfolios). Combined with thedeterioration, during the previous months, of the Weighted AverageRisk Factor (WARF) of JAZZ III underlying portfolios, this default,if occurred, would trigger a significant downward revision ofexpected cash flows for the two Jazz III investments. These positionsbeing priced at 5% of par since the last coupon payment at the end ofMarch and representing 0.9% of the GAV, it shouldn't however have amaterial impact on the GAV of Volta.The other Corporate Credit asset, ARIA III, representing 13.1% of theend of June GAV, is not exposed to CIT Group and its ability to paycash flows in the future hasn't significantly changed since the lastinterim report. Meanwhile, being like Jazz III a first loss positionit remains sensitive to any credit event that could occur.As regard the Company's residual and mezzanine debt of CLOsexposures, defaults and downgrades in underlying portfolios continuedto occur but the prices of loans, especially the lower-rated ones,tended to increase a bit further on average, consequently the numberof residual tranches suffering at least a partial diversion of cashflows remains stable and all the 10 mezzanine debt tranches held byVolta, representing 9.9% of the end of month GAV, continue toperform, in term of cash flows, in line with the assumptions at thetime of their purchase. However, it should be noticed that oneposition, the ?2.5m nominal position in the Class E debt of EuroGalaxy CLO B.V. representing 0.1% of the end of month GAV, suffered asignificant deterioration of its over-collateralization tests due tothe occurrence of several defaults in the last months. This positioncould suffer, if defaults continue to occur in its underlying loansportfolio at a significant pace, a diversion of its coupon payment inthe coming months or quarters and could have to be impaired at alater stage. This asset being priced at 3% of par at the end of June,a further deterioration of its situation shouldn't have a significantimpact on Volta's GAV.The depressed economic environment and the ongoing wave of downgradesand defaults are expected to continue having a negative impact on theexpected cash flows of most of the Company's CLO residual holdings,even if the rebound in loan prices allowed some CLO managers to cleanup some positions and to improve their OC tests. A furthersignificant deterioration of these parameters could also impact thepayments of the mezzanine debt tranches.As regards the Company's ABS investments, no particular event hasaffected the six UK non-conforming residual holdings. PromiseMobility, a residual position in a very diversified portfolio ofsmall and medium German companies remains one of the largest singleexposure of Volta, representing 12.9% of the GAV as of the end ofJune. At the time of writing this report this deal continues tobehave, in terms of credit events, in line with or better than whatwas expected at the time of purchase despite the particular difficulteconomic environment for German small and medium enterprises.At the end of June, the Company held the equivalent of ?26.2m of cash(?0.87 per share). Most of the cash held by the Company will be usedfor investing as well as paying operating expenses and dividends.The Company is considering that opportunities could be seized incurrent market environment in several structured credit sectors.Mezzanine tranches of CLO and of European ABS or senior tranches ofCorporate Credit portfolio could be considered as the main area forsuch investments. Investments will be realised depending on the paceat which market opportunities could be seized.* "Mark-to-market variation" is calculated as the Dietz-performanceof the assets in each bucket, taking into account the MtM of theassets at month-end, payments received from the assets over theperiod, and ignoring changes in cross currency rates Nevertheless,some residual currency effects could impact the aggregate value ofthe portfolio when aggregating each bucket.** Index data source: Markit, Bloomberg(Full monthly report in attachment or on www.voltafinance.com)*****ABOUT VOLTA FINANCE LIMITEDVolta Finance Limited is incorporated in Guernsey under the Companies(Guernsey) Laws, 1994 to 1996 (as amended) and listed on EuronextAmsterdam. Its investment objectives are to preserve capital and toprovide a stable stream of income to its shareholders throughdividends. For this purpose, it pursues a multi-asset investmentstrategy targeting various underlying assets. Volta Finance's basicapproach to its underlying assets is through vehicles andarrangements that provide leveraged exposure. The exposure to thoseunderlying assets is gained through direct and indirect investment infive principal asset classes: corporate credits, CDOs, ABS, leveragedloans, and infrastructure assets.Volta Finance has appointed AXA Investment Managers Paris, aninvestment management company with a division specialised instructured credit, for the investment management of all its assets.ABOUT AXA INVESTMENT MANAGERSAXA Investment Managers (AXA IM) is a multi-expert asset managementcompany within the AXA Group, a global leader in financial protectionand wealth management. AXA IM is one of the largest European-basedasset managers with ?485 billion in assets under management as of theend of December 2008. AXA IM employs approximately 2,900 peoplearound the world and operates out of 21 countries.CONTACTSCompany SecretaryMourant Guernsey Limitedvolta.finance(at)mourant.com+44 (0) 1481 715601Portfolio AdministratorDeutsche Bankvoltaadmin(at)list.db.comFor the Investment ManagerAXA Investment Managers ParisSerge Demayserge.demay(at)axa-im.com+33 (0) 1 44 45 84 47*****This press release is for information only and does not constitute aninvitation or inducement to acquire shares in Volta Finance. Itscirculation may be prohibited in certain jurisdictions and norecipient may circulate copies of this document in breach of suchlimitations or restrictions.This press release is not an offer of securities for sale in theUnited States. Securities may not be offered or sold in the UnitedStates absent registration with the United States Securities andExchange Commission or an exemption from registration under the U.S.Securities Act of 1933, as amended (the "Securities Act"). VoltaFinance has not registered, and does not intend to register, anyportion of any offering of its securities in the United States or toconduct a public offering of any securities in the United States.*****This document is being distributed by Volta Finance Limited in theUnited Kingdom only to investment professionals falling withinarticle 19(5) of the Financial Services and Market Act 2000(Financial Promotion) Order 2005 (the "Order") or high net worthcompanies and other persons to whom it may lawfully be communicated,falling within article 49(2)(A) to (E) of the Order ("Relevantpersons"). The shares are only available to, and any invitation,offer or agreement to subscribe, purchase or otherwise acquire theshares will be engaged only with, relevant persons. Any person who isnot a relevant person should not act or rely on this document or anyof its contents. Past performance cannot be relied on as a guide tofuture performance.*****This press release contains statements that are, or may deemed to be,"forward-looking statements". These forward-looking statements can beidentified by the use of forward-looking terminology, including theterms "believes", "anticipated", "expects", "intends", "is/areexpected", "may", "will" or "should". They include the statementsregarding the level of the dividend, the current market context andits impact on the long-term return of Volta's investments. By theirnature, forward-looking statements involve risks and uncertaintiesand readers are cautioned that any such forward-looking statementsare not guarantees of future performance. Volta Finance's actualresults, portfolio composition and performance may differ materiallyfrom the impression created by the forward-looking statements. VoltaFinance does not undertake any obligation to publicly update orrevise forward-looking statements.Any target information is based on certain assumptions as to futureevents which may not prove to be realised. Due to the uncertaintysurrounding these future events, the targets are not intended to beand should not be regarded as profits or earnings or any other typeof forecasts. There can be no assurance that any of these targetswill be achieved. In addition, no assurance can be given that theinvestment objective will be achieved.*****http://hugin.info/137695/R/1329614/313990.pdfThis announcement was originally distributed by Hugin. The issuer is solely responsible for the content of this announcement.
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" alt="REC ASA - Primary insider transaction>">Datum: 17.07.2009 - 19:39 Uhr
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