Air Methods higher as earnings trickle out; PG&E higher as new director named

By James McCandless

San Antonio, April 23 – Oil and oil services names were much of the focus of the distressed space on Tuesday.

Air Methods Corp.’s notes were gaining as the private company appeared to please stakeholders with its earnings report.

Sector peer Bristow Group Inc.’s issues were also higher despite expectations that it will file for bankruptcy next month.

Meanwhile, despite oil futures continuing to rise, California Resources Corp.’s paper was lower and Ensco Rowan plc’s notes were mixed while Alta Mesa Resources, Inc.’s issues were rising.

Elsewhere, PG&E Corp.’s paper was higher after striking a deal with a major shareholder to appoint a new board member.

In health care, Teva Pharmaceutical Industries Ltd.’s notes pushed up as it stopped research on a cluster headache drug.

Shipping name Navios Maritime Holdings Inc.’s issues moved higher during the day.

Real estate investment trust CBL & Associates Properties, Inc.’s paper was on the negative side of activity.

Air Methods up

In the energy services space, Air Methods’ notes were gaining, traders said.

The 8% notes due 2025 gained 1 point to close at 61 bid.

On Tuesday, the Englewood, Colo.-based helicopter company issued its earnings report, though results were not made immediately made available to the public by the privately held company.

“It looks like they made stakeholders happy,” a trader said. “This sector has gotten destroyed recently. If they’re going to recover, they have to diversify and start to focus on emergency medical services. This part of the oil business has been decimated recently.”

The company announced on Monday that it would shutter four medical helicopter bases in Oklahoma that had served area hospitals.

Bristow higher

Elsewhere in the sector, Bristow’s issues were similarly higher, market sources said.

The 6¼% notes due 2022 picked up 2 points to close at 20¼ bid.

The Houston-based offshore transporter’s issues have been on an upward trend despite an expectation that it will file for bankruptcy early next month.

Earlier in the year, the company obtained default waivers from creditors in order to extend due dates.

Last week, it announced a strategic alternatives review and its intention to forego a $12.5 million interest payment on the 6¼% notes.

“Those waivers run out in May and it’s all but certain that they’ll file then,” a trader said.

Oil names mixed

Despite the continued rise of oil futures, popular distressed energy tranches varied in direction, traders said.

Los Angeles-based independent oil and gas producer California Resources’ paper went negative.

The 6% paper due 2024 fell 1¼ points to close at 70½ bid. The 8% paper due 2022 lost 1¾ points to close at 83¼ bid.

London-based contract driller Ensco’s notes finished mixed.

The 7¾% notes due 2026 added 3½ points to close at 88½ bid. The 5.2% notes due 2025 shaved off ¼ point to close at 81¾ bid.

Houston-based producer Alta Mesa’s issues rose.

The 7 7/8% notes due 2024 improved by 1¼ points to close at 37¼ bid.

West Texas Intermediate crude oil futures for June delivery saw a 75-cent improvement to close the session at $66.30 per barrel.

North Sea Brent crude futures for June delivery were similarly better, ending the day at $74.51 per barrel after a 47-cent gain.

PG&E gains

Utility name PG&E’s paper was moving higher, market sources said.

The 4.3% paper due 2045 rose 1¼ points to close at 89½ bid.

Late Monday, news broke that the San Francisco-based electric utility announced that it had struck a deal with large investor BlueMountain Capital Management to replace an existing board member with Fred Buckman, a utilities executive. The company also hired Christopher Hart as an independent safety advisor.

The company has recently been at odds with the activist investor over its bankruptcy filing and has now withdrawn the nominee slate of directors with which it wanted to replace members of the board.

A shareholder meeting to solidify replacement board members has been pushed back to June to finalize the lineup.

Teva improves

In the health care space, Teva’s notes were seen improving on Tuesday, traders said.

The 4.1% notes due 2046 added ½ point to close at 72½ bid. The 3.15% notes due 2026 edged up ¼ point to close at 84 bid.

The Petach Tivka, Israel-based generic pharmaceuticals name announced on Tuesday that it had halted development on a cluster headache medication after researchers became concerned that it would not meet goals set in late-stage trials.

Last week, the Food and Drug Administration approved the company’s new nasal spray meant to treat opioid overdose.

Navios better

In shipping, Navios Maritime’s issues were moving better, market sources said.

The 7 3/8% notes due 2022 picked up 2 points to close at 58¾ bid.

“Nothing was in the news about it today,” a trader said. “But it’s seen some more trading recently.”

Last week, the company’s structure saw more attention after it announced the $103.2 million sale and leaseback transaction for three MR2 product tankers and two LR1 product tankers.

CBL negative

Elsewhere, CBL’s paper was being pushed downward, traders said.

The 5¼% paper due 2023 slipped 1½ points to close at 74 bid. The 4.6% paper due 2024 dropped 1½ points to close at 67½ bid.

The Chattanooga, Tenn.-based real estate investment trust has been under pressure as the retail sector continues to trend negative.

“Most of its tenants are retailers and it’s a bad time to have any part of that,” a trader said.

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