Weatherford notes mixed on ratings downgrade; L Brands issues lower as holiday shopping wraps up

By James McCandless

San Antonio, Dec. 26 – A short Christmas Eve session saw a broad decline in distressed trading.

Weatherford International plc’s notes were mixed after the company received a ratings downgrade.

Denbury Resources Inc.’s issues continued to drop as the company works to justify a potential merger to stakeholders.

Despite oil losses, California Resources Corp.’s paper traded up while Ensco plc’s and Sanchez Energy Corp.’s notes fell.

Elsewhere, in retail, L Brands, Inc.’s issues were declining as the brunt of the holiday shopping season passes.

J.C. Penney Co., Inc.’s paper also fell while Revlon Inc.’s notes were mixed.

Altice SA and Intelsat SA’s issues were negative in the telecom space.

Weatherford mixed

Weatherford’s notes were mixed in a short session, traders said.

The 4½% notes due 2022 lost 3 points to close at 52 bid. The 9 7/8% notes due 2024 picked up ¼ point to close at 60¼ bid.

On Monday, S&P Global Ratings downgraded the Baar, Switzerland-based oilfield services provider.

The agency lowered the company’s issuer credit rating, secured term loan rating, senior unsecured guaranteed revolving credit facility rating and senior unsecured notes rating.

A negative outlook was affirmed.

The company recently received a delisting warning from the New York Stock Exchange.

Elsewhere in oil, Denbury’s issues extended a decline.

The 63/8% notes due 2021 fell 1½ points to close at 71½ bid. The 5½% notes due 2022 shed 2 points to close at 68½ bid.

On Friday, the 6 3/8% notes lost 1 point and the 5½% notes dropped 1¼ points.

The Plano, Texas-based independent producer filed an S-4 document with the Securities and Exchange Commission on Friday, outlining its argument to shareholders on why they should approve a proposed $1.7 billion acquisition of Penn Virginia.

Another decline in oil futures led to a mostly negative day for distressed oil names.

An exception was Los Angeles-based producer California Resources as its 8% paper due 2022 gained 2 points to close at 68¼ bid.

London-based contract driller Ensco’s notes followed the negative trend.

The 7.2% notes due 2027 shaved off 5½ points to close at 71 bid. The 4½% notes due 2024 traded down 1¾ points to close at 62 bid.

Houston-based peer Sanchez Energy’s 6 1/8% notes due 2023 lost 1 point to close at 15 bid.

In a short session, West Texas Intermediate crude oil futures lost $3.06 to close at $42.53 per barrel.

North Sea Brent crude followed suit, moving lower by $3.35, ending the day at $50.47.

“Last week, I thought we found the bottom,” a trader said. “But with the bumpiness we’re seeing across the market, I wouldn’t get your hopes up.”

L Brands down

In retail, L Brands’ paper was negative, market sources said.

The 6¾% paper due 2036 dropped 2½ points to close at 81 bid. The 6 7/8% paper due 2035 fell 1 point to close at 82¾ bid.

The Columbus, Ohio-based retailer, among others in the sector, are under the market’s magnifying glass as the bulk of holiday shopping comes to a close.

While the company’s notes saw higher trading after reports of increasing November sales, the latter half of the month saw them under pressure after the company sold one of its brands to a private equity firm for an undisclosed amount.

Meanwhile, Plano, Texas-based department store chain J.C. Penney’s 7.4% notes due 2037 gave back ½ point to close at 33½ bid.

Despite the sector’s negativity, New York City-based cosmetics producer Revlon’s issues were positive.

The 5¾% notes due 2021 rose ½ point to close at 75½ bid. The 6¼% notes due 2024, while rising as high as 51½ bid, settled back to their Friday level of 49¾ bid, according to Trace data.

Altice drops

Altice’s paper was leading a decline in the telecom space, traders said.

The 7¾% paper due 2022 fell ¼ point to close at 89½ bid.

The Amsterdam-based telecom name has been under pressure as it works to climb out of debt and increase revenues, which have recently started to increase in certain markets.

Elsewhere, Luxembourg-based satellite operator Intelsat’s notes were also trending downward.

Intelsat Jackson Holdings SA’s 5½% notes due 2023 fell ¼ point to close at 85½ bid. Intelsat (Luxembourg) SA’s 8 1/8% notes due 2023 lost 1 point to close at 73 bid.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.