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Annual Results

CVC Credit Partners European Opps NAV down

11 February 2015 07:33

The net asset value of CVC Credit Partners European Opportunities' euro and sterling ordinary shares fell slightly in the year to the end of December.

The NAV of the euro and sterling shares stood at £1.0247 and £1.0287 respectively - down from £1.0293 and £1.0305 at the end of 2013.

Chairman Richard Michael Boléat said: "The 2014 calendar year, which is also the company's fiscal year, may be treated as the company's first full year of normalised operations, given that the company's capital was in the process of being committed to investments during the post-IPO ramp-up period to 31 December 2013.

"Observers of the company's target asset class will have noted 2014 as being a year characterised by an excess of demand over supply of risk assets, which had the effect of driving loan and bond yields towards post-2008 historic lows in the first half of 2014, notwithstanding the modest risk pricing adjustments which took place towards the end of 2014.

"Yields in European high yield bonds remain tight, as do default rates. The Company's capital is predominantly committed to the European corporate sector, and thus the ECB's asset quality review ("AQR") combined with ECB President Draghi's QE policy initiatives, are likely to have a significant influence on the Company's opportunity set during 2015.

"Real eurozone interest rates at or below zero are expected to remain a feature of the European macro environment for the foreseeable future, particularly given the deflationary consequences of recent energy price adjustments, whilst the AQR has the potential to provide new corporate financing opportunities at attractive prices. The continuing ability of investors to invest the capital required to absorb potential AQR driven transactions is likely to determine whether risk pricing returns to long term averages or remains at or around current levels.

"Given the tight risk pricing markets which characterised 2014, the fact that the Company paid its maiden normalised dividend of 2.5pps/cps in July 2014 and was able to declare a dividend of an equivalent amount on 29 January 2015 for the second half of 2014 is very pleasing. The current gross yield of the company's underlying investment portfolio, before fees and expenses, stands at 6.2% and this supports a positive dividend outlook for 2015. The Investment Vehicle Manager continues to rotate the underlying asset portfolio into higher yielding primary and selective secondary assets as is sensible and as market conditions permit."

Story provided by StockMarketWire.com

Related Company: CCPG

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