Whiting Petroleum’s loss widens, bonds slip; MEG firms despite swinging into the red; First Quantum up

By Stephanie N. Rotondo

Seattle, July 28 – Earnings continued to be the main driver of distressed bonds during Thursday’s trading session.

In the oil and gas arena, Whiting Petroleum Corp. reported its earnings late Wednesday. The results showed a wider loss due to depressed crude oil prices.

Come Thursday, the bonds were busy, but lower.

MEG Energy Corp., a Canadian oilsands producer, then released its latest quarterly figures early Thursday. Like Whiting, the company also reported a wider loss due to declining oil prices.

However, its bonds traded up on the day.

In the mining space, First Quantum Minerals Ltd. swung to a profit year over year. That helped its debt trade up.

Elsewhere, Intelsat SA paper continued its upward move after reporting earnings that beat analysts’ expectations on Wednesday.

A trader said the 7¼% notes due 2020 ticked up 1½ points to 72, while the 7½% notes due 2021 added half a point to close at 70.

At another desk, the 6 5/8% notes due 2022 linked to Intelsat Jackson Holdings SA were seen rising a point to 69 bid.

For the quarter, Intelsat posted earnings per share of 98 cents on revenue of $542 million.

Analysts polled by Thomson Reuters had predicted EPS of 34 cents on revenue of $537.3 million.

Additionally, Intelsat reaffirmed its 2016 guidance, placing revenue between $2.14 billion and $2.2 billion.

Whiting weaker post-earnings

A trader said there was “a fair amount of activity” in the 5¾% notes due 2021 after the Denver-based oil and gas producer reported a much wider loss for the second quarter.

He saw the bonds sliding over half a point to 84½.

For the quarter, Whiting reported a net loss of $301 million, or $1.33 per share. That compared to a loss of $149.3 million, or 73 cents per share, the year before.

On an adjusted basis, the company posted a loss of 70 cents per share. Analysts polled by Thomson Reuters had predicted a loss of 46 cents per share.

Production declined 22% during the quarter to 12.2 million barrels of oil equivalent.

MEG up despite numbers

Also in the oil and gas arena, MEG Energy saw its quarterly results swing to a loss versus a profit the year before.

However, the company’s debt managed to gain ground.

A trader said the 6½% notes due 2021 rose a point to 75. Another market source pegged the 7% notes due 2024 at 74¾, a gain of nearly a point on the day.

MEG posted a net loss of C$146 million, or C$0.65 per share. That compared to a profit of C$63 million, or C$0.28 per share, the previous year.

Revenue declined 7.6% to C$513 million.

First Quantum gains

First Quantum Minerals swung to a profit for the second quarter of 2016, according to its latest earnings release.

The news resulted in some upward momentum for the 7% notes due 2021, a trader said. He placed the issue at 88 1/8, up over half a point.

Net income for the quarter came to $141 million, or 18 cents per share. On an adjusted basis, EPS was 5 cents per share.

The Vancouver, B.C.-based company also reported revenue of $659 million.

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