Adient notes drop after earnings release; PG&E issues mixed amid new headlines

By James McCandless

San Antonio, Feb. 7 – Thursday’s session in the distressed space saw weakness across the spectrum.

Adient plc’s notes dropped after the company released disappointing earnings and revenues in the first quarter.

Elsewhere, PG&E’s issues closed mixed amid a new round of negative headlines.

Meanwhile, CommScope Technologies LLC’s paper continued to climb as its parent company priced a $3.75 billion three-tranche offering.

In the energy space, Hi-Crush Partners LP’s notes moved lower a day after the company issued its lackluster Q4 report.

Leaking oil futures led to similar declines in EP Energy Corp., Alta Mesa Resources, Inc. and California Resources Corp.’s issues.

In telecom, Frontier Communications Corp. and Intelsat SA’s paper declined.

Adient drops

Adient’s notes fell in the Thursday session, traders said.

The 4 7/8% notes due 2026 declined 3¼ points to close at 71½ bid.

Early Thursday, the Dublin-based automotive seating manufacturer released its first-quarter earnings report.

The company showed a 31 cents per share profit, missing analyst predictions of 48 cents per share.

It also posted lagging revenues of $4.16 billion.

Guidance for the rest of the fiscal year suggest that the company expects sales to weaken.

“What’s really dragging them is the cash flow situation,” a trader said. “There’s not much to point to suggest that a turnaround is coming soon.”

PG&E mixed

Elsewhere, in utilities, PG&E’s issues were mixed, market sources said.

The 6.05% notes due 2034 added ¾ point to close at 87¾ bid. The 4¾% notes due 2044 held level at 79¾ bid.

On Wednesday, news broke that the San Francisco-based electric utility’s updated mitigation plan, filed with California regulators, would potentially cut power to as many as 5.4 million customers to mitigate risks in wildfire conditions.

The company also said that it would spend over $2 billion in wildfire prevention efforts.

CommScope climbs

Meanwhile, CommScope’s paper continued a positive trend, traders said.

The 5% paper due 2027 picked up ¾ point to close at 86¼ bid.

On Thursday, The Ashburn, Va.-based wireless engineering solutions name’s paper continued on its positive trend as parent company CommScope Inc. priced a $3.75 billion three-tranche deal of high yield notes.

Hi-Crush off

Oil and gas name Hi-Crush’s notes were lower, market sources said.

The 9½% notes due 2026 shed 1¼ points to close at 76¼ bid.

The Houston-based energy logistics company released its fourth-quarter earnings report on Tuesday, disappointing on earnings.

It reported an 8 cents per share loss, lower than the expected 6 cents per share loss.

On Thursday, news broke that high levels of frac sand mining has led to oversaturation in the market.

Now expected to sell at a diminished $30 per ton, frac sand is one of the company’s core segments.

Oil names lose

A sharp decrease in oil futures saw similar movements in distressed oil names, traders said.

Houston-based independent oil and gas producer EP Energy’s issues were headed lower.

The 8% notes due 2024 fell 2 points to close at 77 bid. The 8% notes due 2025 shed 2 points to close at 49½ bid.

Houston-based sector peer Alta Mesa’s paper ended the trading day worse off.

The 7 7/8% paper due 2025 fell 5 points to close at 61½ bid.

Los Angeles-based producer California Resources’ notes followed the negative trend.

The 6% notes due 2024 gave back 1½ points to close at 68 bid. The 8% notes due 2022 lost 2½ points to close at 79½ bid.

Thursday trading saw West Texas Intermediate crude oil futures for March delivery drop $1.37, closing at $52.64 per barrel.

North Sea Brent crude futures ended at $61.63 per barrel after a similar fall of $1.06.

Telecom down

Heavily traded names in the telecom sector also experienced weakness, market sources said.

Norwalk, Conn.-based wireline telecom name Frontier’s issues dropped.

The 7 5/8% notes due 2024 leaked ½ point to close at 54¼ bid. The 10½% notes due 2022 lost 2½ points to close at 68 bid. The 11% notes due 2025 were lower by 1¾ points to close at 61¼ bid.

Luxembourg-based satellite operator Intelsat’s paper also experienced turbulence.

Intelsat Jackson Holdings SA’s 5½% paper due 2023 fell ¼ point to close at 91 bid. Intelsat (Luxembourg) SA’s 8 1/8% paper due lost ¾ point to close at 85¼ 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.