Hertz notes off on Q2 results, financing news; Occidental declines after earnings

By James McCandless

San Antonio, Aug. 11 – As the distressed debt session came to a close, travel and energy names saw most of the attention on Tuesday.

Hertz Global Holdings, Inc.’s notes drifted lower after reporting second-quarter results and announcing a search for debtor-in-possession financing.

Meanwhile, in oil and gas, Occidental Petroleum Corp.’s issues lost ground after reporting earnings, highlighted by a $6.6 billion write-down.

Sector peer Antero Resources Corp.’s notes gained after announcing the start of a three-series tender offer.

As oil futures were under pressure, Whiting Petroleum Corp.’s and Valaris plc’s issues varied in direction.

Mall owner Washington Prime Group, Inc.’s paper was active but ultimately unchanged after reporting its earnings.

Property name CBL & Associates Properties, Inc.’s notes were under pressure.

Elsewhere, telecom name GTT Communications, Inc.’s issues slipped after reporting that it would delay the filing of its 10-Q.

Business software provider Exela Technologies, Inc.’s paper rose despite reporting a quarterly loss.

Hertz lower

Hertz’s notes were seen drifting lower throughout the session, traders said.

The 6¼% senior notes due 2022 were docked 1 point to close at 37 bid. The 5½% senior notes due 2024 shaved off ¾ point to close at 37¼ bid.

After the close on Monday, the Estero, Fla.-based car rental company reported earnings results for the second quarter.

The company showed a loss per share of $3.51, wider than the $2.33 loss that was expected by analysts.

Revenues also fell short of expectations at $832 million.

In a Monday filing with the Securities and Exchange Commission, Hertz said that it is now seeking DIP financing for its Chapter 11 bankruptcy process.

The move comes after the company attempted to raise additional capital by selling $500 million in common stock, which was nixed after the SEC began inquiries.

Before the offering was terminated, $29 million was raised.

Occidental loses

Meanwhile, in oil and gas, Occidental Petroleum’s issues lost ground, market sources said.

The 2.9% senior notes due 2024 lost ¼ point to close at 94½ bid. The 2.7% senior notes due 2022 gave up ½ point to close at 97 bid.

The Houston-based independent oil and gas producer released a negative second-quarter earnings report after the Monday close.

The company showed a loss of $1.76 per share, worse off than the consensus predictions.

Revenues were also weak at $2.93 billion.

Also, the company reported a write-down of $6.6 billion for the quarter.

“They may be losing money, but they are too big for a restructure,” a trader said.

Antero gains

Sector peer Antero Resources’ paper gained as the session concluded, traders said.

The 5 1/8% senior notes due 2022 jumped up 8¼ points to close at 90¼ bid. The 5 5/8% senior paper due 2023 added 2½ points to close at 76¼ bid.

On Tuesday, the Denver-based oil and gas producer launched cash tender offers to purchase any and all of its $500,202,000 of 5 3/8% senior notes due 2021 and up to the Dutch auction cap of its $756.03 million of its 2022 notes and its $705,641,000 of its 2023 notes, Prospect News reported.

The any-and-all offer is scheduled to expire at 5 p.m. ET on Aug. 17.

Holders of the 2021 notes accepted for purchase will receive the consideration of $980 for each $1,000 principal amount of the notes.

Oil names vary

As oil futures were under pressure, distressed energy names varied in direction, market sources said.

West Texas Intermediate crude oil futures for September delivery were pushed down 33 cents to cap the day at $41.61 per barrel.

North Sea Brent crude oil futures for October delivery finished at $44.50 per barrel after a 49 cent loss.

Denver-based E&P Whiting Petroleum’s notes were mixed.

The 6¼% senior notes due 2023 declined by ½ point to close at 18 bid. The 6 5/8% senior notes due gained ¼ point to close at 18¾ bid.

London-based contract driller Valaris’ issues diverged.

The 5.2% senior notes due 2025 shot up ½ point to close at 5½ bid. The 7¾% senior notes due 2026 shed ½ point to close at 5½ bid.

Washington Prime flat

Mall owner Washington Prime’s paper was active but ultimately unchanged, traders said.

The 6.45% senior notes, while pushing up into the 40 context during the day, ended up closing level at 38½ bid.

After the end of Monday activity, the Columbus, Ohio-based real estate investment trust posted second-quarter results.

The company reported a 1 cent per share profit, weaker than the 12 cents per share profit that analysts had predicted.

Revenues were under expectations at $98.76 million.

Rents collected by the company were pegged at 71.3% for July.

Concurrently, Washington Prime also said it had received lender consents to modify its existing $1.3 billion credit facilities, including an immediate waiver of some financial covenants.

Chattanooga, Tenn.-based property name CBL’s notes were under pressure.

The 5¼% senior notes due 2023 were pushed down ½ point to close at 22¼ bid. The 4.6% senior notes due 2024 lost ½ point to close at 22½ bid.

GTT slips

Elsewhere, telecom name GTT’s issues were seen slipping, market sources said.

The 7 7/8% senior notes due 2024 dropped 4½ points to close at 48 bid.

During the Tuesday session, the McLean, Va.-based cloud networking company announced that it would delay the filing of its quarterly report for Q2.

In a filing with the SEC, the company said that it had found “certain issues related to the recording and reporting of Cost of Telecommunications Services and related internal controls.”

GTT did not provide a new date for the filing and does not expect to meet an Aug. 17 extension.

Exela notes up

Business software name Exela’s paper was on the rise, traders said.

The 10% notes due 2023 picked up 4¼ points to close at 29¼ bid.

The Irving, Tex.-based business software solutions company also released its numbers for the second quarter, putting out the report late Monday.

Exela reported a 34 cents per share loss.

Last month, Exela completed a $12.3 million sale of its records storage business, which is part of its ongoing initiative to divest in non-core assets.

© 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.