Antero notes active as Q2 results released; United Airlines mixed after furlough warning

By James McCandless

San Antonio, July 30 – Energy and travel names took center stage in distressed debt trading on Thursday.

Antero Resources Corp.’s notes varied in direction after the release of the company’s second-quarter earnings results.

Sector peer Valaris plc’s issues saw mixed results after warning that a debt restructuring through a bankruptcy filing is imminent.

Declining oil futures were met with similar movements by Whiting Petroleum Corp.’s paper while SM Energy Co.’s notes differed in direction.

Meanwhile, United Airlines Holdings, Inc.’s issues moved on separate tracks after warning of more potential layoffs.

Air carrier American Airlines Group Inc.’s paper declined.

Connected commerce name Diebold Nixdorf, Inc.’s notes improved after the company outperformed on Q2 earnings.

Elsewhere, REIT CBL & Associates Properties, Inc.’s issues fell after announcing the extension of its forbearance agreements.

Mall owner Washington Prime Group, Inc.’s paper tracked upward.

Antero varies

Antero Resources’ notes varied in direction as the session ended, traders said.

The 5 1/8% senior notes due 2022 held level to close at 80 bid. The 5 5/8% senior notes due 2023 shaved off ½ point to close at 70½ bid.

The Denver-based independent oil and gas producer’s structure was in focus after releasing its second-quarter earnings results after the close on Wednesday.

The company reported a loss per share of 37 cents, weaker than the 15 cents per share loss predicted by analysts.

Revenues were also underwhelming at $484.91 million.

As part of its earnings presentation, Antero said that it would focus on keeping output flat and saving on costs amid continuing uncertainty in the energy markets.

The quarter’s drilling and completion capital spending came in at $180 million, the lowest since 2013.

“For now, they seem to be one of the few E&P’s keeping their head above water,” a trader said.

Valaris notes mixed

Sector peer Valaris’ issues saw mixed results, market sources said.

The 5.2% senior notes due 2025 were docked 1 point to close at 4 bid. The 5¾% senior notes due 2044 grabbed ¼ point to close at 6½ bid.

In a Thursday filing with the Securities and Exchange Commission, the London-based contract driller said that it would likely implement a debt restructuring process through an imminent Chapter 11 bankruptcy filing.

The company also said that it would likely not be able to comply with some of the requirements of its credit agreements, such as maintaining a debt-to-capitalization ratio equal or less than 60%.

Oil trends downward

West Texas Intermediate crude oil futures for September delivery dived $1.35 to finish at $39.92 per barrel.

North Sea Brent crude oil futures for October delivery concluded the session at $42.94 per barrel after an 81 cent drop.

Denver-based producer Whiting Petroleum’s paper followed the trend.

The 6¼% senior paper due 2023 gave up 1 point to close at 18 bid. The 6 5/8% senior notes due 2026 lost ½ point to close at 18¼ bid.

SM Energy, another Denver-based E&P, saw its notes differ in direction.

The 6 5/8% senior notes due 2027 rose ½ point to close at 50¾ bid. The 6 1/8% senior notes due 2022 drifted ¾ point to close at 74¼ bid.

United Airlines drifts

Meanwhile, United Airlines’ issues moved on separate tracks, market sources said.

The 5% senior notes due 2024 dipped 1 point to close at 84 bid. The 4¼% senior notes due 2022 improved 1 point to close at 89 bid.

During the Thursday session, reports indicated that the Chicago-based airline has told its pilots that more furloughs than expected may be needed through this year and in 2021.

The company previously announced that it would issue furloughs for 2,250 pilots by the end of the year and another 1,650 in 2021.

Earlier in the month, the company said that potential furlough notices would be sent to tens of thousands of U.S. frontline workers.

In its recent Q2 earnings report, United showed a loss of $9.31 per share and revenues of $1.48 billion.

Fort Worth-based air carrier American Airlines’ paper declined.

The 5% senior notes due 2022 lost ½ point to close at 58 bid.

Diebold improves

ATM name Diebold’s notes marked the day with an improvement, traders said.

The 8½% senior notes due 2024 added 1½ points to close at 91 bid.

The North Canton, Ohio-based connected commerce solutions provider’s structure garnered more attention after releasing Q2 results before the Thursday open.

The company reported a profit of 38 cents per share, better than the analyst consensus of a 1 cent per share profit.

Revenues also outpaced predictions at $890.5 million.

Earlier in July, Diebold issued $1.1 billion of senior secured notes and extended its senior secured revolving credit facility.

CBL notes lower

Elsewhere, property name CBL’s issues fell as the day concluded, market sources said.

The 5¼% senior notes due 2023 were pushed down 1½ points to close at 22¾ bid. The 4.6% senior notes due 2024 fell 2 points to close at 22¼ bid.

The Chattanooga, Tenn.-based real estate investment trust’s majority owned subsidiary CBL & Associates LP further amended each of the forbearance agreements with holders of its 5¼% senior notes due 2023, holders of its 5.95% senior notes due 2026 and lenders of its credit agreement dated Jan. 30, Prospect News reported.

The forbearance period on the bank loans was extended to Aug. 5 while the notes’ forbearance period was stretched to Aug. 3.

The forbearances were triggered after electing to not make the 2023 notes interest payment and 2026 notes interest payment.

Meanwhile, Columbus, Ohio-based mall owner Washington Prime’s paper tracked upward.

The 6.45% senior notes due 2024 tacked on ¾ point to close at 39 bid.

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