CVC Credit Partners reports another strong year – CVC Credit Partners European Opportunities posted a positive set of numbers for the year to 31 December 2017 . The NAV total return per share for GBP share class (CCPG) and EUR share class (CCPE) increased by 9.69% and 8.84% respectively over the period. This is within the total return target of 8% to 12% set by the Company, after a similar performance in 2016. For the same period, the Credit Suisse Western European HY Index hedged to Euro returned 6.28% and the Credit Suisse Western ELLI hedged to Euro returned 3.30%.
As at the end of December 2017, floating rate instruments comprised 87.6% of the portfolio. The current gross yield of the asset pool at year-end was 5.8%.
The quality (investment grade) core income segment of the portfolio delivered 2.5% to gross portfolio performance. The high yielding credit opportunities segment of the portfolio delivered a gross 20% return, which equates to a 8.9% gross portfolio performance contribution based on a 44% average allocation of the portfolio.
The manager commented that the combination of quality (investment grade) corporate bonds providing stable yield exposure alongside the higher yielding credit opportunities strategy provides a balanced portfolio risk profile in differing market environments.
Looking towards 2018 – managers’ outlook:
The managers believe that the market anticipates that the global recovery will be on-going for an extended period. There also appears to be scope for the strengthening to broaden further across Europe and emerging markets. Macroeconomic risks across these regions have receded and there is upside potential if productivity picks up alongside trade and investment.
In the US, where the cycle is more mature, the managers believe that leading indicators remain strong and point to solid corporate earnings in 2018. Central banks will remain pivotal, where tapering in Europe, rate normalisation in the US and a 0% rate fix in Japan should help support market sentiment.
CCPG : CVC Credit Partners reports another strong year
CCPE : CVC Credit Partners reports another strong year