Edison Investment Research - CVC Credit Partners European Opportunities (GBP) (CCPG) CVC Income Growth - Equity-like return potential on senior secured debt

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Edison Investment Research

Pedro Fonseca

CVC Income & Growth - Equity-like return potential on senior secured debt

FY22 was the first year since its inception that CVC Income & Growth (CVC IG) saw a negative NAV total return (TR). Its euro and sterling share classes produced NAV total negative returns of c 8.3% and 6.8%, respectively, which compares with 3.3% and 1.9% negative TRs by the Credit Suisse Western European Leveraged Loan Index (CS WELLI) in euro and sterling terms, respectively. This was primarily the result of downward mark-to-market valuation adjustments (resulting in unrealised losses for CVC IG), driven by price declines in the European loan market amid higher risk aversion. Meanwhile, defaults in the European loan market remained low at 0.4% in 2022, based on the Morningstar European Leveraged Loan Index (with no defaults in CVC IG’s portfolio). Subsequently, European loan markets rebounded strongly in January and February 2023, leading to 6.7% and 6.9% returns for CVC IG’s euro and sterling share classes, respectively (therefore allowing CVC IG to almost fully recoup the 2022 loss).

24/03/2023 1 EN

Underlying

CVC Credit Partners European Opportunities (GBP)

CVC Credit Partners European Opportunities is a closed-ended investment company limited by shares. Co. invests predominantly in companies domiciled, or with material operations, in Western Europe across various industries. Co.'s investments are focused on senior secured obligations of such companies but investments are also made across the capital structure of such borrowers.

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JE00B9MRHZ51 London Stock Exchange Jersey

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Edison Investment Research

Edison is an investment research and advisory company, with offices in North America, Europe, the Middle East and AsiaPac. The heart of Edison is our world renowned equity research platform and deep multi-sector expertise. At Edison Investment Research, our research is widely read by international investors, advisors and stakeholders. Edison Advisors leverages our core research platform to provide differentiated services including investor relations and strategic consulting.

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Analysts

Pedro Fonseca

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CVC Income & Growth - Equity-like return potential on senior secured debt

CVC Income & Growth - Uncertainty creates opportunity

CVC Credit Partners European Opportunities - Floating rate advantage in 2022

Sylvania Platinum - Annual guidance maintained, despite strike

1Spatial - Investing in the transformational SaaS opportunity

Datatec - FY24 underlying EPS more than doubles y-o-y

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