Following on from AXA IM’s published Volta Finance Ltd (LON:VTA) monthly report for July, DirectorsTalk caught up with Andrew Worne of Cenkos Securities Plc who highlighted to us that despite all the prevailing factors, the cash generation is very strong:
“As a result, in July, Volta received “only” the equivalent of €3.9m from its CLO Equity positions, relative to €5.7m in April. The decline is almost evenly split between the two technical effects so that October cash flows are expected to be roughly €1m higher. On a 6-month basis, Volta received the equivalent of €17.7m as at the end of July. Nonetheless, this represents a solid 17% annualised yield based on the end of July NAV, despite the previously mentioned technical impacts. And likely to remain so.
We reiterate our view that going forward, as long as there is no second wave requiring significant lockdowns of the economy, full cash flow payments should be the norm for Volta’s portfolio as CLO managers are regaining some cushion on the OC tests.”
Volta Finance Limited is a closed-ended limited liability company registered in Guernsey under the Companies Law, 2008 with registered number 45747. The registered office of the Company is BNP Paribas House, St Julians Avenue, St Peter Port, GY1 1WA, Channel Islands.